Global inflation has brought new challenges for people. Budget 2023 launches new and expanded measures to help people with their expenses and new investments to build a stronger, more secure future for everyone.

Putting money back into people’s pockets

The rising global cost of living has squeezed household budgets. The Province responded and has already rolled out almost $2.4 billion in supports since summer 2022:

• three BC affordability credits in October, January and April;
• higher BC Family Benefit amounts for January, February and March;
• a $100 credit for people’s power bills;
• ICBC rebates for drivers; and
• enhanced School Affordability Fund to help parents and kids with back-to-school costs.

These one-time supports build on years of investments to reduce child care costs and create new affordable, quality, inclusive child care that families can depend on. Thousands of B.C. families are benefiting from lower child care fees through the Affordable Child Care Benefit, the $10 a Day ChildCareBC program and the Child Care Fee Reduction Initiative, which saves families up to $900 in savings per child per month.

Budget 2023 builds on these investments with an additional $4.5 billion in new spending and credits over three years to help people with the effects of rising costs and to establish stable, sustainable support.

• Budget 2023 invests $214 million over three years to expand existing school food programs and increase capacity to address student hunger in all districts. The program will help school-age children reliably access nutritious food in partnership with the Feed BC program, so that kids can eat healthy, local food and focus on learning.
• Starting April 1, 2023, B.C. will be the first jurisdiction in Canada to make prescription contraception free to all residents.
  • Budget 2023 dedicates $119 million over three years to remove this cost and give people more choices about their own sexual and reproductive health.
  • The program will fully cover prescription contraception options, including most oral hormone pills, contraceptive injections, copper and hormonal intrauterine devices, subdermal implants and Plan B (also known as the morning-after pill).
  • For a person who pays $25 a month for hormonal pills, free prescription contraception could save them as much as $10,000 over their lifetime.
• Families with children will see a 10% increase to the monthly BC Family Benefit starting in July 2023. At the same time, single parents will receive as much as $500 annual top-up to help make ends meet.
  • For a two-parent family with two children, this amounts to as much as an additional $250 per year to help buy food, pay bills and enrol kids in extracurricular activities.
• For a single parent with one child, this amounts to an additional $650 per year or almost $12,000 in extra support over 18 years.
• A new income-tested renter’s tax credit will provide as much as $400 annually to renters starting in 2024, giving the most support to households with moderate and low incomes.
  • With one in three B.C. households renting their home and facing increasing costs in a tight rental market, the income-tested renter’s tax credit is expected to reach more than 80% of renter households, including people who receive income and disability assistance or support from the Rental Assistance Program (RAP) or Shelter Aid for Elderly Renters (SAFER).
  • Households that make less than $60,000 per year will be able to claim the full credit amount, while households that earn as much as $80,000 per year will receive a partial amount.
  • Starting with 2023 tax returns next year, the credit is expected to collectively put more than $300 million back in B.C. renters’ pockets per year.
• To help people with the costs of a changing climate and increases to the carbon tax across the country, the BC Climate Action Tax Credit will increase along with the carbon tax.
  • Last year, a two-parent family that received the full amount could have received $500 through the Climate Action Tax Credit. As of July 2023, the same family could receive almost $900 per year.
  • A single person that received the full $193.50 credit amount last year will now receive $447 per year.
  • As the carbon tax rate increases, the annual amounts paid through the Climate Action Tax Credit will also increase each year.
  • A significant majority of British Columbians are projected to receive more through the enhanced credit than they pay in increased carbon tax costs by 2030.
  • With the goal of reaching 80% of all B.C. households by 2030, the income ceiling for the Climate Action Tax Credit will also increase annually.
• For British Columbians with the lowest incomes, the Climate Action Tax Credit can more than offset their personal cost of the carbon tax.
• People looking for extra support and flexibility as they pursue higher education will be able to access more money through student loans and improved repayment terms.
  • Starting in August 2023, student loan maximums will double, providing students with a total of $220 per week and $280 per week for students with dependents.
  • Beginning Aug. 1, 2023, new repayment terms will align with the federal Repayment Assistance Program so that students and graduates who make less than $40,000 a year won’t have to make any payments on their outstanding loans.
  • For people making more than $40,000, their student loan payments will be 10% of their annual household income, rather than 20%.
  • With B.C. student loans interest-free since 2019, people pursuing an education in B.C. will have access to more flexible supports and options so that they can continue to study and succeed.

Boosting systems of support

For people who receive income or disability assistance, the rising cost of living has added additional pressure to day-to-day life. Budget 2023 recognizes the added strain of the effects of global inflation and dedicates $558 million to enhancing and expanding supports for people who need it most.

• For the first time since 2007, the shelter rate, which is a core part of the income and disability assistance rate, will increase by $125 per month with increased payments, starting July 2023. The increase will help approximately 160,000 people, including 33,000 children, throughout B.C.
  • On top of that, people receiving income and disability assistance who rent will be able to claim the new renter’s tax credit, which can provide as much as $400 annually.
• For people who have emergent or specific needs, such as medical transportation or dietary restrictions, increases to supplements will also make it easier to access and use individualized supports.
• People will be able to keep more of the money they earn from wages without having assistance payments reduced. Earnings exemption will increase by $100 per month for people who receive income assistance and $1,200 per year for people who receive disability assistance.

For many people who assist and care for children in care, extended family members or people with support needs, current prices have created new pressures when providing nurturing and quality care. During the next three years, $264 million will go toward increasing financial supports, including care-provider rates by as much as 47%, so that foster families and caregivers have the support they need to continue this work.

Coming out of the COVID-19 pandemic, new pressures in B.C.’s housing and rental markets have made it even more difficult for people and families to find homes in the communities in which they live, work, learn and play. Budget 2023 makes targeted investments to get people into homes they can afford and lays the groundwork for a refreshed housing plan.

Where we were

In 2018, housing prices were being driven up by rampant speculation and years of under investment in creating new homes. Homes for B.C.: A 30-point Plan for Housing Affordability in British Columbia set out the first phase of the Province’s actions to address housing affordability. With an initial investment of $7 billion over 10 years to build new homes – the biggest housing investment in B.C. history – the plan also included measures to moderate an overheated housing market, crack down on tax fraud and close loopholes, prevent speculation and provide security for renters and homeowners.

Since the plan’s launch, the Province has funded more than 40,000 affordable new homes, and B.C. has seen record housing starts and thousands of empty homes return to the rental market, thanks in part to the Speculation and Vacancy Tax.

A refreshed housing strategy

Building on the Homes for B.C. plan, B.C.’s refreshed housing plan will be released in spring 2023 to respond to new pressures in the housing market. The plan will outline the next steps to ensure B.C. has attainable housing and everyone has a place to call home.

Budget 2023 supports the refreshed housing plan with $4.2 billion in operating and capital funding over the next three years to build thousands of new homes for renters, people with middle incomes, Indigenous people, and students, as well as funding for new transit-oriented development and more complex care and supportive housing.

Building and unlocking more homes

With a growing population, B.C. needs more homes to address the pressures of the housing and rental market today and have an affordable housing supply for the future. Budget 2023 makes significant investments to help put more shovels in the ground and get more affordable, attainable homes built throughout the province.

• Almost $1.7 billion in operating and capital funding over the fiscal plan will create thousands of homes through the BC Builds and Building BC programs, which includes targeted investments in the Indigenous Housing Fund and the Community Housing Fund.
  • As part of B.C.’s work to create more affordable housing near major transit corridors, this funding includes $394 million to help buy land for thousands of new homes near future transit development projects.
  • Under the Rapid Housing Initiative, a federal-provincial cost-shared program, $66 million will help people in B.C. who have urgent housing needs.
• An additional $575 million over three years will support the construction of thousands of new student housing spaces, including in high-demand areas in the Lower Mainland, southern Vancouver Island and Thompson Okanagan.

Unlocking homes and supporting people

Budget 2023 sets out new actions to create strong supports for people and address the issues that matter.

• A new income-tested renter’s tax credit will put as much as $400 annually back into the pockets of thousands of renters with moderate and low incomes, starting next year when people file their 2023 income taxes. It is expected to reach more than 80% of renter households.
• More than $7 million over the fiscal plan will help support the BC Rent Bank to provide crucial financial support to prevent eviction and homelessness.
• More than $15 million over three years will increase staffing and capacity at the Residential Tenancy Branch so disputes can be resolved more quickly.

Many homeowners recognize the challenges in B.C.’s housing market and want to be a part of the solution. As part of Budget 2023, new investments will support work to reduce rezoning restrictions, enable more multi-unit homes, and create pilot projects with financial incentives for homeowners to build secondary suites.

Through Budget 2023, the Province is also introducing a new property transfer tax incentive to encourage the construction of new purpose-built rentals.

Taking action to address homelessness and encampments

With the combined crises of housing affordability, drug toxicity and the COVID-19 pandemic worsening homelessness, Budget 2023 takes action to help people and communities with new and expanded responses to address homelessness and encampments. This includes strategies to prioritize cultural safety, Indigenous and community partnerships, and the inclusion of people with diverse identities and needs.

• As much as $640 million in additional funding over three years for the Supportive Housing Fund will help build and operate more supportive housing for people experiencing or at risk of homelessness.
• A further $169 million over the fiscal plan will create additional new complex-care housing units, as well as $97 million in operating funding that will support complex-care services, such as enhanced health, mental-health and substance-use services for people who need additional support beyond traditional supportive housing.
• More than $228 million over three years will help create regional multidisciplinary teams to support rapid response for communities dealing with substantive encampments in their area.
• Approximately $44 million over three years will help expand access to temporary modular supportive housing and provide more on-site support for people living in encampments, such as fire prevention, safety and sanitation while housing gets built.
• An additional $109 million over the fiscal plan will help expand shelter and low-income assistance programs, so that more people can access these essential supports.
• For people housed in temporary leased spaces as part of the Province’s pandemic response, as much as $182 million over the fiscal plan will help provide continuing support, including finding more permanent housing solutions.

The challenges of the past several years have reinforced the importance of staying safe and healthy, no matter where you live in B.C. Budget 2023 makes strategic investments to ensure people can continue to access the services and care they need, when they need it, and can feel safe and secure in their communities.

Boosting B.C.’s health-care system

It’s important that government investments reflect the value that thousands of doctors, nurses, technicians, health-care workers and support staff bring to B.C. communities every day.

Budget 2023 takes the next steps to strengthen British Columbia’s health- and mental-health-care system with $6.4 billion in new investments over three years.

• As people grow older and more people move to B.C., Budget 2023 commits $2.6 billion to help with growing demand and increasing costs. As part of that investment, $270 million will go toward the BC Cancer Care Plan to expand and enhance cancer care services in communities throughout the province, in addition to the $150 million going to the BC Cancer Foundation through supplementary estimates.
• B.C.’s health workforce strategy, launched in September 2022, will be bolstered by $995 million over three years to help recruit and retain staff, redesign and rebalance workloads, embed reconciliation and cultural safety, and expand training and education seats for a full range of health-care professionals.
• B.C.’s new payment model for family doctors puts physicians and their patients front and centre. Budget 2023 provides more than $1 billion to help implement the new model and ensure that doctors are better recognized for the primary care they provide and their essential role as a gateway to the broader health-care system.
• To support the ongoing management and health response to COVID-19, Budget 2023 provides $875 million to continue B.C.’s COVID-19 response.

Within the health-care system, it’s essential that people who struggle with mental-health, addiction or substance use can find and stay connected to the care they need. As part of the $6.4-billion investment, Budget 2023 sets out more than $1 billion in new funding over the fiscal plan, which includes $867 million in operating funding and $169 million in capital investments.

• For people struggling with substance-use disorder, more than $586 million will add treatment and recovery beds throughout B.C., develop and roll out a new model of seamless care to support people through their entire recovery journey, create wraparound supports, expand Indigenous treatment centres, and develop new recovery communities to support people and their recovery through the long term.
• The Province will expand on the Red Fish Healing Centre model of care to other regions of the province, so that more people can receive care for complex mental-health and substance-use issues closer to home.
• Budget 2023 accelerates the Province’s response to the illicit drug toxicity crisis across the full continuum of care with an additional $184 million to support:
  • enhanced prevention and early intervention services for child, youth and young adults;
  • safe prescription alternatives to the toxic drug supply to save lives;
  • expanding two mobile response programs: Car Programs, which bring together police and health workers, and Peer Assisted Care Teams (PACTs), which are led by civilians; and
  • planning to create culturally safe PACTs led by Indigenous people.
• Through B.C.’s new housing investments and the refreshed housing plan, Budget 2023 dedicates $169 million over three years in capital funding to help create additional complex-care beds to support people with complex mental-health and substance-use issues, including those who are homeless or whose needs are not met by existing supportive housing. As part of health-care investments, Budget 2023 provides $97 million in operating funding to provide people staying at complex-care facilities with health-focused supports and services.

To ensure health-care centres and hospitals can continue to provide the best care possible for British Columbians, Budget 2023 dedicates $11.2 billion over three years as part of the largest-ever capital investment for new health-care infrastructure. Major projects that have been approved include:

• the new St. Paul’s Hospital, with capacity for 548 in-patient beds when open in 2027, and projected budget of approximately $2.2 billion;
• the new Surrey Hospital and cancer care centre to help meet the needs of a growing and aging population in 2027, with a projected budget of more than $1.7 billion;
• the Cowichan and District Hospital Replacement Project to open in 2027 with a budget of more than $1.4 billion;
• phases 2 and 3 of the Royal Columbian Hospital redevelopment and expansion of the acute-care tower, emergency department and operating rooms, with the acute-care tower opening in 2025 with a budget of approximately $1.2 billion;
• the redevelopment of Richmond Hospital to replace the acute-care tower and expand capacity for an anticipated 2031 opening with a projected budget of more than $860 million;
• the replacement of the Mills Memorial Hospital in Terrace will add inpatient beds and expand a regional mental-health rehabilitation and recovery program for 2026 with a projected budget of $633 million;
• the replacement of the Dawson Creek and District Hospital will include more inpatient beds and an expansion of the emergency department, surgical and operating space and ambulatory care services for an anticipated 2027 opening with a projected budget of $378 million.

Building safe and healthy communities and improving access to justice

Budget 2023 funds new and expanded enforcement and intervention services to keep people and communities safe. Safe and healthy communities are supported by new health and mental-health investments, including treatment services, safe supply, complex-care housing and new integrated community response teams.

Across the fiscal plan, Budget 2023 sets out $462 million to help build safe communities, improve access to justice and to create connected, cohesive support for people with mental-health and addictions challenges. Many of the initiatives funded through Budget 2023 were announced as part of B.C.’s Safer Communities Action Plan in November 2022.

• For communities served by provincial police services, a $230-million boost will help hire another 256 RCMP officers to enhance enforcement and crime prevention capacity, particularly for rural, remote and Indigenous communities. This will help provide supports for police to focus on violent crimes and other pressing public safety issues.
• Approximately $87 million in new funding is supporting the launch of two new enforcement programs: the new Repeat Violent Offending Intervention Initiative, and the new Special Investigation & Targeted Enforcement (SITE) program to help reduce repeat offending, improve criminal justice response and speed up information-sharing among justice partners.
• To continue to modernize policing in B.C., Budget 2023 sets out $25 million for consultation and public engagement to inform new policing and police oversight legislation.
• Approximately $21 million will support cannabis licensing operations, including the cannabis licensing system, streamlining service delivery, and strengthening compliance and enforcement.

In January 2023, British Columbia became the first province to decriminalize simple possession of small amounts of illicit drugs for personal use. To move forward on decriminalization, Budget 2023 provides $19 million over three years to help reduce stigma and evaluate the implementation.

Knowing that B.C.’s legal system will support and serve everyone is an important part of creating a safe, secure province. Complementing B.C.’s investments to build safer communities with services that support and represent the diverse makeup of the province, an additional $80 million over three years will be dedicated to improving access to justice.

• In partnership with the BC First Nations Justice Council, 10 new Indigenous Justice Centres will open over the next two years to provide free and culturally safe places that provide legal help, early resolution programs, support and representation for Indigenous Peoples. Supported by $44 million over the plan, the network of Indigenous Justice Centres will expand to 15 locations and one virtual centre, supporting the important work of addressing the overrepresentation of Indigenous people in the criminal justice system.
• With an additional $13.5 million over three years, the BC Human Rights Tribunal will get a significant boost to core funding to improve processes at the tribunal and the Community Legal Assistance Society will help more disadvantaged people access free legal services.
• Approximately $16 million over the fiscal plan will help with virtual and after-hours bail hearings to expedite court hearings. Virtual bail allows accused people to attend bail hearings in their home communities instead travelling to a bigger city where they are disconnected from family and community supports.
• Additional investments in justice include a base-budget boost of $2 million per year for the Independent Investigations Office, which investigates incidents of death or serious harm that may have involved a police officer.

With almost $1.4 billion in new operating and capital funding over the fiscal plan, Budget 2023 sets the groundwork for a greener, more sustainable future powered by good-paying jobs, holistic management of natural resources, healthy and active communities, reducing emissions, responding to a changing climate and partnerships with Indigenous Peoples.

Skills for the jobs of the future

B.C.’s people are the key to building a strong, sustainable economy. With more than one million job openings anticipated over the coming decade, Future Ready is B.C.’s plan to ensure everyone has the opportunity to learn new skills and secure good-paying jobs that will support them and their communities, and to respond to the biggest challenge heard from businesses – the need for people.

Budget 2023 lays out $480 million over three years to support Future Ready’s work to break down barriers to post-secondary training, so more people can get the training they need for in-demand careers and employers can access the talent they need.

The Future Ready plan includes initiatives, such as:

• a new grant for short-term skills training, which will help people get the relevant skills and training they need to succeed in good-paying, high-demand jobs;
• new funding to assist small and medium-sized businesses in finding and implementing practical solutions to current labour market challenges and prepare for a changing economy;
• more opportunities for Indigenous Peoples, including funding to support Indigenous-led programs, such as a new Guardian training program that will be co-developed with Indigenous Peoples; and
• creating thousands of new training seats for in-demand fields to help build up a workforce ready and able to meet the demands of the future.

An additional $58 million over three years will help expand supports for newcomers and speed up foreign credential recognition for professionals, such as health-care or child care workers.

Future Ready will help maximize workforce participation throughout B.C. by offering supports, programs and access to targeted training that is affordable, accessible and recognizes the needs of individual learners. It is focused on opening economic opportunities, including for people who are underrepresented or face barriers in the workforce, such as Indigenous, Black and people of colour (IBPOC), women, people with disabilities, 2SLGBTQ+ people, immigrants, people with multiple barriers, youth and former youth in care.

The full Future Ready plan will be released in spring 2023.

Clean, sustainable economic development

B.C. is fortunate to have many natural resources that shape the province’s landscape, grow a strong economy and support vibrant, diverse communities. It’s essential that these resources are managed and cared for in collaboration with Indigenous Peoples to create a sustainable economy that will continue to benefit and support people in B.C. for generations to come.

Budget 2023 invests more than $250 million over three years to protect, maintain and care for B.C.’s abundant natural resources, including:

• $21 million to partner with First Nations on eight more Forest Landscape Planning projects to protect more old growth, while providing greater certainty on where sustainable harvesting can occur;
• $77 million to speed up natural-resource permitting and begin modernizing B.C.’s permitting service-delivery model, which will help reduce backlogs, move projects forward, and continue to advance electrification and connectivity in remote, rural and Indigenous communities;
• $6 million over three years for a new critical minerals strategy to leverage B.C.’s natural-resource advantages and continue to assess the critical mineral value chain potential;
• $101 million in operating and capital funding over the fiscal plan to help preserve and enhance outdoor recreational opportunities in BC Parks and outdoor recreation sites and trails; and
• $49 million in operating and capital funding over three years to maintain and upgrade forest service roads.

These investments build on the BC Manufacturing Jobs Fund, which was recently doubled to $180 million, and helps support innovation projects around the province, such as helping mills move away from old growth logs and toward higher-value products, such as mass timber.

B.C. has one of the strongest climate plans in North America. Budget 2023 continues to build on the cornerstones of the CleanBC Roadmap to 2030 to reduce emissions and build a sustainable economy for the future.

• Building on past investments, Budget 2023 commits $100 million over the next three years for building active transportation networks – the single largest investment in active transportation in B.C. history. Whether people walk, cycle or take transit, this new funding will expand different modes of transportation that work best for different B.C. communities.
• Approximately $40 million will move forward B.C.’s transition to a zero-emission economy through the CleanBC Go Electric Commercial Vehicle Pilot Program to help B.C.-based businesses, non-profit organizations and eligible public entities make the switch to zero- emission vehicles, including medium- and heavy-duty trucks.
• These new investments in Budget 2023 add to previous CleanBC investments of more than $3.5 billion since 2019.

A new carbon tax framework for industry

Carbon pricing is an important part of the CleanBC Roadmap to 2030, which is B.C.’s plan to cut emissions and build a sustainable, low-carbon future that benefits everyone. B.C. has been working closely with the federal government and industry to develop a new made-in-B.C. carbon-pricing framework for industry to help reduce emissions, while staying affordable and competitive, and aligning with the federal benchmark.

Budget 2023 outlines the path ahead and the current industry carbon-pricing system will remain in place for a transition year. Starting April 1, 2024, the new industry carbon-pricing system will replace the existing system. More details about the new carbon pricing framework, including performance benchmarks for industry, will be available later this spring. The Province will continue to work with industry throughout 2023 to ensure effective implementation of the new system.

Starting April 1, 2023, the carbon tax will increase by $15 per tonne each year until it reaches $170 in 2030. As the carbon tax increases, B.C.’s Climate Action Tax Credit will also go up to help offset rising costs for the people most affected. By 2030, it is expected a significant majority of British Columbians will receive more through the enhanced credit than they pay in carbon tax costs.

Climate resilient communities

Budget 2023 includes more than $1.1 billion over the next three years to fight climate change by building more climate-resilient communities. For communities still affected by climate-related disasters, Budget 2023 makes smart investments to help communities build back stronger and help people seize the opportunities of a low-carbon future.

• The plan includes $750 million committed in Budget 2022 to help communities affected by extreme climate-related disasters, such as wildfires and the November 2021 floods.
• Through Budget 2023, the Province is allocating an additional $300 million in capital funding over the fiscal plan to support the repair or replacement of provincial infrastructure damaged by climate emergencies.
• B.C. has created a new Ministry of Emergency Management and Climate Readiness to enhance the Province’s capacity to respond to emergencies and help communities plan and prepare for a changing climate.
  • Budget 2023 provides $85 million over three years to increase emergency-management capacity in the province and provide new investments in disaster risk assessment, preparedness and mitigation.
  • Funding will help the Province, First Nations and local governments work together to make communities more resilient.
• Through a federal-provincial cost-share arrangement, the BC Wildfire Service will receive $64 million over the next five years for firefighting equipment. This builds on the B.C. government’s decision in Budget 2022 to expand wildfire prevention and move to staffing B.C.’s wildfire service year round.

Budget 2023 addresses people’s challenges today, while working to build a strong, sustainable future for everyone. The budget continues government’s prudent approach to fiscal planning, while prioritizing the issues that matter most: helping people with costs, tackling the housing crisis, strengthening health and mental-health services, supporting safe, healthy communities and building a sustainable economy that works for everyone.

Budget outlook

Budget 2023’s three-year fiscal plan presents declining deficits:

• $4.2 billion in 2023-24
• $3.8 billion in 2024-25
• $3 billion in 2025-26

The B.C. government has included layers of prudence to account for potential lower-than-expected revenues and unforeseen expenses or emergencies. Budget 2023 includes a forecast allowance of $700 million in 2023-24, as well as $500 million in each of 2024-25 and 2025-26.

Government has put aside contingencies of $2.3 billion in 2023-24, $2.2 billion in 2024-25 and $1.2 billion in 2025-26 for climate and emergency response, CleanBC and other spending uncertainties for new and existing programs. Additional contingencies include $1 billion in 2023-24 for pandemic recovery, as well as $2.2 billion in 2023-24, $2.6 billion in 2024-25, and $2.7 billion in 2025-26 for the costs of the Shared Recovery Mandate, as well as a further $800 million in 2025-26 for future cost pressures.

The 2022 Shared Recovery Mandate provides wage increases and inflation protection for B.C. public-sector workers to help protect and improve the services people rely on, such as health care and education. It is estimated to cost $10.8 billion over the three-year mandate term (2022-23 to 2024-25) with ongoing annual costs of $5.4 billion. Budget 2023 provides more than $15 billion over three years (including contingencies funding) to support agreements under the Shared Recovery Mandate from the beginning of the mandate in 2022.

Economic outlook

The province’s economy expanded by an estimated 2.8% in 2022, and growth is expected to slow to 0.4% in 2023. Slower near-term economic growth is being seen across jurisdictions and reflects a slower global economy, as well as the combined effects of higher prices and raised interest rates throughout Canada. Real gross domestic product (GDP) is expected to grow by 1.5% in 2024 and range between 2.2% and 2.4% annually over the medium term (2025 to 2027).

Budget 2023 projections are prudent in the near-term and align with the average outlook provided by the independent 13-member Economic Forecast Council.

Revenue outlook

Total government revenue is forecast at $77.7 billion in 2023-24, $79.7 billion in 2024-25 and $82.2 billion in 2025-26. The gradual increase in revenue is driven by a growing tax base due to strong population growth and supported by nominal GDP, while partly offset by lower natural resource revenues, including lower commodity price and flat forestry revenues.

Revenue for 2023-24 is expected to be somewhat lower than 2022-23 because of unexpected higher-than-projected income-tax revenues from Canada Revenue Agency for the 2021 tax year.

Expense outlook

Expenses over the three-year fiscal plan are forecast at $81.2 billion in 2023-24, $83 billion in 2024-25 and $84.8 billion in 2025-26 to help support the programs and services people rely on, as well as strategic investments in health care, mental health, housing, public safety and helping people with rising costs.

Capital spending

Taxpayer-supported capital spending over the fiscal plan is projected to be $37.5 billion and includes investments to sustain and expand provincial infrastructure, including housing, hospitals, schools, post-secondary facilities, transit, roads and bridges.

Debt affordability

B.C.’s taxpayer-supported debt is projected to be $63.7 billion at the end of 2022-23, approximately $9.8 billion less than projected at Budget 2022. This improvement is attributed to better-than- expected operating results in 2022-23, which was driven by fast economic recovery in some sectors, and higher-than-projected income-tax revenues.

The taxpayer-supported debt-to-GDP ratio, a key metric used by credit rating agencies, is expected to be approximately 18.9% in 2023-24 and remain below 25% over the fiscal plan. This relatively low debt-to-GDP ratio among Canadian provinces signals that provincial debt is manageable and sustainable, and means B.C. continues to have capacity to borrow and refinance in the future.

The interest bite, which represents the taxpayer-supported interest costs as a percentage of provincial government revenue, remains historically low at less than three cents per dollar in 2023-24.

Putting the surplus to work for people

At this time, updated Third Quarterly Report forecasts for the 2022-23 fiscal year show a projected surplus of $3.6 billion, lower than Second Quarterly Report projections. The change is because

of $2.7 billion in new spending through supplementary estimates, as well as new spending that includes the Rental Protection Fund ($500 million) and a third BC Affordability Credit to help people with cost-of-living pressures ($500 million). Revenue improvements since the second quarter offset some of the spending.

The current year’s surplus allows the Province to reinvest in the services and supports people need – now and for the long term. The surplus projection is expected to continue to shift as revenue forecasts are updated and the Province continues to put the surplus to work for people.

Final numbers will be released through Public Accounts. Unspent funds remaining at the end of the fiscal year will be used to pay down provincial debt to create more fiscal capacity for future spending and programs.

Initiatives funded through supplementary estimates include:

• $1 billion for the Growing Communities Fund;
• $500 million to support BC Ferries fare affordability;
• $450 million for Critical Community Infrastructure funding;
• $160 million for food security initiatives;
• $150 million for the BC Cancer Foundation;
• $150 million for local, Indigenous and remote communities to get ready for Next Generation 911 services;
• $100 million for a watershed security fund;
• $75 million to accelerate existing reconciliation agreements with First Nations; and
• $45 million for public libraries to support accessibility, inclusion and reconciliation, and respond to rising costs and growing demand for services. This includes opportunities for libraries to improve access to books and digital collections, programs, technology and operating hours.