BC Budget 2015 – “Balanced Budget 2015”
BC Budget 2015 – “Balanced Budget 2015” 1. Economic outlook Indicators of B.C.’s economic performance in 2014 reveal increased domestic activity relative to the same period of 2013, including growth in key areas such as exports, retail sales and housing starts. The government forecasts the B.C. economy to grow by 2.3% in 2015, 2.4% in 2016 and 2.3% in 2017. Downside risks to B.C.’s economic outlook include the potential for a slowdown in domestic and U.S. activity, ongoing fragility in Europe, and slower than anticipated Asian demand, particularly in China. Additional risks include a fluctuating Canadian dollar and weak inflation, in part due to lower oil prices. 2. Three-year fiscal plan Budget Estimate 2015/16 Plan 2016/17 Plan 2017/18 Revenue ………………………………………… 45,772 Expense …………….....…....………………..…(44,793) Surplus (deficit) before forecast allowance ………… 979 Forecast allowance ……………………………… (100) Surplus (deficit) ........................………………………… 879 46,365 (45,831) 534 (250) 284 47,646 (46,920) 726 (350) 376 48,617 (47,868) 749 (350) 399 Capital spending: Taxpayer-supported capital spending …………3,637 Self-supported capital spending ……………… 2,604 6,241 3,731 2,518 6,249 3,726 2,527 6,253 3,199 2,944 6,143 Provincial Debt: Taxpayer-supported debt …………………… 42,302 Self-supported debt ………………………… 21,428 Total debt (including forecast allowance) ………… 63,830 43,182 22,528 65,960 44,126 23,769 68,245 44,7339 25,321 70,404 Taxpayer-supported debt-to-GDP ratio ……………… 17.7% Taxpayer-supported debt-to-revenue ratio 95.8% 17.4% 95.4% 17.1% 95.1% 16.6% 94.7% Economic Forecast: 2014 Real GDP growth ......................................... 2.2% Nominal GDP growth .................................... 3.9% 2015 2016 2017 2.3% 3.8% 2.4% 4.3% 2.3% 4.3% ($ millions) BCRPA - 2015 BC Provincial Budget Summary Updated Forecast 2014/15 Page 1 of 14 Risks to the Fiscal Plan The main risks to the government’s fiscal plan include: risks to the BC economic outlook, largely due to the continued uncertainty surrounding global economic activity; assumptions underlying revenue, including Crown corporation income forecasts, such as economic factors, commodity prices and weather conditions; potential changes to federal government allocations for health and social transfers and costsharing agreements, as well as impacts on the provincial income tax bases arising from federal government tax policy changes; utilization rates for government services such as health care, children and family services, and income assistance; and the outcome of litigation, arbitrations, and negotiations with third parties, including the appeal of the BC Supreme Court decision on the teachers’ contract issue. 3. Budget Highlights 1. Health Care The annual budget for the Ministry of Health will increase by a further $491 million in 2015/16. BC still leads the nation in important health outcomes while maintaining control over cost escalation. BC continues to be only one of three provinces with healthcare costs under $4,000 annually per capita, while again ranking best in terms of Life Expectancy, Cancer Mortality, and Mortality related to Diseases of the Heart and second best for Infant Mortality. 2. Supporting Economic Development Budget 2015 provides $31 million over three years to support mining and the ongoing development of a liquefied natural gas (LNG) industry in British Columbia. 3. Benefitting the Environment Overall, Budget 2015 provides $47 million over three years for initiatives benefiting the environment. The Water Sustainability Act modernizes British Columbia’s water laws, regulates groundwater use and strengthens provincial water management in light of growing demands for water and a changing climate. Budget 2015 provides $22 million over three years for an incentive program for the cement industry to produce cement in a cleaner manner. Budget 2015 directs all revenues from freshwater fishing licenses to the Freshwater Fisheries Society for conservation activities. This will provide $10 million over three years in incremental funding to the society. BCRPA - 2015 BC Provincial Budget Summary Page 2 of 14 In addition, Budget 2015 reintroduces the Clean Energy Vehicle Incentive Program and a fuelling/charging infrastructure program which will provide British Columbians incentives when considering the variety of clean and green choices for their transportation needs. Additional energy efficiency and conservation initiatives will also be implemented. 4. Supporting Families Budget 2015 provides an additional $150 million over the next three years to support families and individuals most in need. In Budget 2015 government’s contribution to Community Living British Columbia will increase by $106 million over the next three years. Effective September 1, 2015 government will no longer deduct child support payments from income and disability assistance calculations. Income and disability assistance clients will be able to keep every dollar they receive in child support payments over and above what they receive in income and disability assistance. Budget 2015 provides net additional funding of $20 million for individuals and families in need of income assistance to address caseload growth in disability income assistance, supplementary assistance and program delivery costs, partially offset by an anticipated reduction in temporary income assistance caseloads. 5. Policing and Community Safety In Budget 2015, government will invest an additional $15 million over the next three years to fund increased RCMP costs in support of government’s continued commitment to a strong provincial police force to keep communities safe. 6. Strategic Investments to Non-Government Partners Budget 2015 is accelerating $107 million of grants and other payments to local governments, public libraries, and other non-government agencies into 2014/15, so as to provide more funding certainty to those entities. 7. Capital Spending Current and planned capital investments in Budget 2015 include: A new Clayton North Secondary School in Surrey Replacement of Oak Bay High School in Victoria. The new school includes a theatre, as well as a Neighbourhood Learning Centre with a daycare and programs provided in partnership with Oak Bay Parks and Recreation. A seismic upgrade to Lord Strathcona Elementary Current and planned investments in the post-secondary sector include: Renewal and expansion of Camosun College’s Interurban Campus Trades Facilities in Victoria BCRPA - 2015 BC Provincial Budget Summary Page 3 of 14 Expansion and renovation of the existing Trades Campus at Okanagan College in Kelowna A new campus for Emily Carr University at Great Northern Way in Vancouver Support for research infrastructure through the British Columbia Knowledge Development Fund, with external funding leveraged from the federal Canada Foundation for Innovation and non-provincial government partners. Key capital investments in the health sector include: Redevelopment of Children’s and Women’s Hospital including the new Teck Acute Care Centre Construction of two new hospitals (one located in Courtenay/Comox and one in Campbell River) new clinical services building for Royal Inland Hospital in Kamloops Construction of the new Joseph and Rosalie Segal Family Health Centre Budget 2015 includes continued investments in government’s transportation investment plan. Highway rehabilitation Side road improvement program Natural gas road upgrade program Highway 1 (Kamloops to Alberta border) George Massey Tunnel replacement project Okanagan Valley corridor Cariboo connector program Major highway corridors and roads Other transportation programs Transit infrastructure Port Mann Bridge/Highway 1 project 4. Tsilhquot’in Nation On June 26, 2014, the Supreme Court of Canada (SCC) awarded Aboriginal title to the Tsilhqot’in Nation for over 1,700 square kilometres of land in the Cariboo-Chilcotin region. The unanimous ruling is the first in Canada to recognize Aboriginal title. The SCC’s interpretation of Aboriginal title has given the Tsilhqot’in the right to control the land within their title area. This decision has clarified the nature of Aboriginal title, including the First Nations’ ‘ownership’ rights within title areas. The Province is working in partnership with the Tsilhqot’in on a framework for reconciliation following the decision. In the past four years, government has signed more than 200 revenue-sharing agreements with First Nations. In the last few months, they have also signed 11 pipeline benefit agreements with 19 First Nations related to LNG development. BCRPA - 2015 BC Provincial Budget Summary Page 4 of 14 5. A Pan-Canadian “Renminibi-Hub” China is now the second largest economy in the world and the largest trading nation. As well, China’s currency – the Renminbi – is now the fifth-largest global -currency in terms of value of payments. When businesses trade internationally, the currencies involved must be converted to execute the transactions. Traditionally, the RMB has not been easily or freely convertible to other currencies. For Canadian businesses trading with China, currency conversions have generally been made into US dollars, and then from US dollars into RMB – doubling exchange rate commission costs. In November 2013, British Columbia was the first foreign government to issue a bond denominated in China’s Renminbi. The bond issues raise the Province’s profile in Asia Pacific financial markets, recognize the internationalization of the RMB, and enhance the trade linkages and relationships between BC and China. On November 8, 2014, a memorandum of understanding between the Bank of Canada and the People’s Bank of China was signed, which will establish Canada as North America’s first offshore RMB hub. The government intends to coordinate and actively work to promote the use of the hub by the business community over the coming year. 6. Tax Measures BC Tax Reduction Credit Effective for the 2015 tax year, the BC tax reduction credit is increased from $412 to $432 and the credit phase-out threshold will rise from $18,327 to $19,000, increasing the amount of income an individual can earn before they start paying provincial income tax, benefiting about 500,000 taxpayers. Children’s Fitness Equipment Credit Effective for the 2015 tax year, a new non-refundable children’s fitness equipment credit is introduced. Parents can already claim the BC children’s fitness credit in respect of registration fees paid for a child’s participation in an eligible program of physical activity. With this budget, a parent can now claim an additional credit in respect of fitness equipment purchased for the child. The new credit is calculated as 50 per cent of the existing BC children’s fitness credit amount claimed. Parents are not required to keep receipts for equipment purchases. The credit provides a benefit of up to $12.65 per child. BC Education Coaching Tax Credit Effective for the 2015 tax year, a new non-refundable BC education coaching tax credit is introduced. The tax credit is available to teachers and teaching assistants who carry out at least ten hours of extracurricular coaching activity in the tax year. The credit amount is $500, providing a tax benefit of up to $25.30 per eligible taxpayer. The credit is available for the 2015, 2016 and 2017 tax years, at which time the credit will be reviewed. Medical Services Plan Premiums Effective January 1, 2016 MSP premium rates will increase by about four per cent or by $3.00 per month to a total of $75.00 for single persons, $5.50 per month to a total of $136.00 for two person families and $6.00 per month to a total of $150.00 for families of three or more persons. BCRPA - 2015 BC Provincial Budget Summary Page 5 of 14 Maximum Tax Rate for Municipal and Regional District Tax Program The Municipal and Regional District Tax Program imposes tax on the purchase of accommodation in designated accommodation areas to raise revenue for municipalities, regional districts and eligible entities primarily for local tourism marketing, programs and projects. The maximum tax rate on the purchase of accommodation under the Municipal and Regional District Tax Program that may be imposed in a designated accommodation area is increased from two per cent to three per cent of the purchase price of accommodation. Municipalities, regional districts and eligible entities will be required to request the government increase the tax rate in their designated accommodation area and details of the application requirements will be made available later in 2015. 7. Expense by Ministry Updated Forecast 2014/15 Budget Estimate 2015/16 Plan 2016/17 Plan 2017/18 Community, Sport and Cultural Development ………… 221 Environment ………………………………………………… 134 Health……………………………………………………… 16,928 Transportation and Infrastructure ………………………… 812 228 150 17,444 814 259 149 17,934 814 264 148 18,471 816 ($ millions) 8. Highlights of Ministry Service Plans* 1. 2. 3. 4. Ministry of Community, Sport and Cultural Development Ministry of Environment and the Environmental Assessment Office Ministry of Health Ministry of Transportation and Infrastructure *these are abbreviated extracts of each Ministry’s 2015/16–2017/18 Service Plans chosen for their relevance to BCRPA members and the parks, recreation and culture sector. 1. Ministry of Community, Sport and Cultural Development Goal 1: Communities and regions are effectively governed. Strategies Enable local governments to maintain core human resource capacity by providing stable, predictable and timely funding to small and medium sized local governments through the administration of Small Community and Regional District Grants. Facilitate infrastructure funding to enable local governments to provide services to residents and create the conditions needed for economic growth. Goal 2: Communities and regions are vibrant and sustainable. Objective 2.2: Communities have effective water and waste management. BCRPA - 2015 BC Provincial Budget Summary Page 6 of 14 Strategies Provide targeted funding to local governments to help them achieve provincial water and waste management objectives. Provide tools and resources to local governments to assist them in conserving and protecting water resources. Encourage local governments to use liquid and solid waste as a resource and maximize the recovery value. Promote the use of the best, lowest life-cycle cost approaches for local government infrastructure projects. Objective 2.3: Local governments are implementing strategies to improve community sustainability. Strategies Update ministry infrastructure funding programs to encourage local governments to innovate, integrate and prioritize those projects that deliver environmental, economic and/or social benefits. Provide guidance, advice and tools to help local governments meet their commitments under the British Columbia Climate Action Charter. In partnership with the Federal Government and the Union of British Columbia Municipalities, continue to implement the Federal Gas Tax Transfer Fund that came into effect on April 1, 2014. Provide tools and resources for local governments to integrate land use planning and management decisions with transportation, infrastructure and financial planning and decision-making. Promote the effective development, adoption and implementation of Regional Growth Strategies by providing advice throughout the process and assistance for resolving disputes. In partnership with the Ministry of Transportation and Infrastructure, the New Building Canada- Small Communities Fund Program, a joint federal/provincial infrastructure funding program, was launched and will assist communities in implementing priority infrastructure projects that support sustainable service delivery. Goal 3: Communities are culturally rich and foster sustainable jobs, economic growth and a vibrant social fabric. Objective 3.1: Creative people, places, and experiences exist throughout B.C. Strategies Work to ensure that B.C.’s cultural assets are maximized to drive tourism opportunities. BCRPA - 2015 BC Provincial Budget Summary Page 7 of 14 Identify opportunities to grow B.C.’s creative economy and creative workforce. Raise awareness within B.C. of the importance of a creative environment and how it [helps create a strong foundation for our communities and] contributes to innovation and economic growth. Support opportunities for youth to be engaged in civic life and their communities. Objective 3.2: The next generation of skilled workers are creative, collaborative and innovative thinkers. Strategies Build on existing expertise in the creative sector and fund projects that support new, innovative approaches to youth engagement in the arts through BC Creative Futures, a strategy for sustainable, long-term success in the province’s creative sector. Prepare our children and youth to excel in the knowledge-based economy through training skilled workers who will be creative, collaborative and innovative thinkers in alignment with the B.C. Skills for Jobs Blueprint. Objective 3.3: British Columbia’s arts and culture sector is vibrant, resilient and recognized for artistic excellence. Strategies Foster artistic excellence in all art forms and practices. Strengthen engagement in the arts. Support the richness of Aboriginal artists and communities in British Columbia. Develop the artistic and adaptive capacity of the arts and culture sector in British Columbia. Engage audiences and artists reflective of the diverse demographics of the province. Goal 4: The provincial sport sector is robust and supports increased participation and athletic achievement. Objective 4.1: Individuals have more opportunities to participate in sport in order to be more physically active, healthier and achieve their personal goals. Strategies Promote opportunities for British Columbians to participate and achieve personal goals in organized sport by supporting programs, services and organizations (e.g. provincial and multi-sport organizations). Provide support to initiatives that reduce geographic, financial and other barriers to participation in physical activity and sport excellence (e.g. Accessibility 2024’s inclusive communities initiatives). BCRPA - 2015 BC Provincial Budget Summary Page 8 of 14 Improve health and educational outcomes for children through school-based and community sport. Increase coach and leadership development opportunities and support organizations and programs that promote safe experiences and skill development in sport. Work with the provincial sport sector to streamline administrative services to create savings available for reinvestment into community programming. Objective 4.2: Athletes have more opportunities to achieve excellence in sport to inspire greater participation in their home communities. Strategies Support B.C.’s elite athletes at all levels in their pursuit of excellence, in national and international level events. Help B.C. athletes excel by providing resources to athletes at various points in their development (e.g. provincial and regional coaching, sport science expertise). Objective 4.3: Major events support sport, economic and community development. Strategies Work with the Ministry of Jobs, Tourism and Skills Training to implement a new 5-year sport-hosting strategy to attract more marquee events to British Columbia. Invest in major hosting opportunities, such as the BC Games, the 2015 FIFA Women’s World Cup of Soccer, the 2016 Wheelchair Rugby World Championships, the 2016 Women’s Fastpitch Championships and the 2016 World Women’s Hockey Championships. Support a wide range of regional sport events province-wide through the Hosting BC program that bring significant social and economic benefits to communities across B.C. Monitor the outcomes of showcasing provincial northern job opportunities during 2015 Canada Winter Games (February 2015) to assess how major sport, arts and culture events may be an efficient and effective promotional tool to help create awareness, attract jobs, new business and tourists to British Columbia. 2. Ministry of Environment and the Environmental Assessment Office Goal 1: Effective, long-term action on climate change Objective 1.1: Maintain B.C.’s global leadership on climate change Strategies The Ministry leads these efforts by: BCRPA - 2015 BC Provincial Budget Summary Page 9 of 14 Coordinating cross-government policy work that supports communities, families, businesses, and local governments to save energy and reduce greenhouse gas emissions; Goal 2: Clean and safe water, land and air Objective 2.2: Reduced contamination from toxins and waste Strategies Ministry work in this area includes: Regulation of liquid waste discharges (sewage and industrial waste); Requiring that local governments have solid waste management plans, and promoting recycling, including organics recycling, and general waste prevention; Objective 2.3: Enhanced protection and stewardship of our air Strategies Ministry work in this are includes: Promoting clean technology standards for industrial air emissions; Establishing air quality objectives for B.C.’s regions; Working with other governments to establish a national air quality management system. Objective 2.4: Effective management of environmental risks Strategies The Province has put a significant emphasis on ensuring responsible resource development. As part of this goal, the Ministry is working toward defining world-leading spill response requirements for the province before accepting the transportation of additional heavy-oil through B.C. and along its coast. Work is under way developing new provincial policies, collaborating with the federal government in areas under its jurisdiction, and reviewing major heavy-oil pipeline proposals to ensure world-leading prevention and spill response is included. The Ministry actively investigates possible non-compliance with standards and regulations. In addition to charges and possible penalties, organizations and individuals in non-compliance are publicly reported in the Ministry’s Quarterly Environmental Enforcement Summaries. Goal 3: Healthy and diverse native species and ecosystems BCRPA - 2015 BC Provincial Budget Summary Page 10 of 14 Objective 3.1: Well-managed and publicly available information is used to conserve, maintain and enhance native species and ecosystems Strategies The Ministry uses its expertise to contribute to environmental stewardship by: Facilitating community initiatives to protect and restore native species and ecosystems; Implementing research programs that support conservation; Developing species at risk programs, strategies and recovery plans (e.g. work on the boreal caribou population and promoting a streamlined federal Species at Risk Act); Collaborating with partners to prevent the spread of invasive species; and, Supporting the government’s Cumulative Effects Framework and Environmental Mitigation and Offsetting Policy, which provide opportunities for government and industry to first consider where development is most appropriate, and then reduce the impacts of those developments that do go forward. Objective 3.2: Protect and manage natural values in B.C.’s parks and protected areas while optimizing outdoor recreation and economic opportunities Strategies The Ministry collaborates with First Nations and communities in protected area planning and management to protect natural, cultural, and recreational assets. To strengthen its parks and protected area system, the Ministry promotes volunteer, sponsorship, partnership and donation opportunities. It also works closely with partners, communities, and First Nations to optimize stewardship, recreational pursuits, and local economic opportunities. Goal 4: British Columbians share responsibility for the environment and the sustainable use of natural resources Objective 4.1: British Columbians are engaged in environmental stewardship initiatives and are provided with the information they need to make sound environmental choices Strategies The Ministry works with communities to deliver Bear Smart, a program that is a clear example of shared environmental responsibility. It works with stewardship organizations to promote outdoor activities that foster a connection to the natural environment. And it also helps British Columbians make smart choices for the environment by providing timely, easily accessible BCRPA - 2015 BC Provincial Budget Summary Page 11 of 14 online information and scientific data on the state of the environment, including @LiveSmartBCca, @EnvReportBC, Environmental Reporting BC, BCAirQuality.ca and LivingWaterSmart.ca. Objective 4.2: Sustainable use of British Columbia’s environmental resources Strategies The Ministry supports communities engaged in multi-stakeholder air and water management, fosters collaborative approaches to sustainable natural resource management, and protects the province’s natural resources from damaging and fraudulent activities. 3. Ministry of Health Goal 1: Support the health and well-being of British Columbians. Objective 1.1: Targeted and effective primary disease prevention and health promotion. Strategies Work with health authorities and other partners to continue implementation of Promote, Protect, Prevent: Our Health Begins Here. BC’s Guiding Framework for Public Health, the provincial framework for supporting the overall health and well-being of British Columbians and a sustainable public health system. Work with health authorities, physicians and other partners to implement the Healthy Families BC Policy Framework, improving the health of British Columbians by supporting communities, schools, workplaces and health care settings in promoting healthy lifestyles and creating healthy environments. Goal 2: Deliver a system of responsive and effective health care services across British Columbia. Objective 2.3: Sustainable and effective health services in rural and remote areas of the province, including First Nations communities. Strategies Develop local community plans for rural and remote communities to create environments that foster healthy behaviours to improve the health of the population. BCRPA - 2015 BC Provincial Budget Summary Page 12 of 14 4. Ministry of Transportation and Infrastructure Goal 1: Improved infrastructure drives economic growth. Objective 1.2: Identify and select priority improvement projects. Strategies Identify key safety and mobility improvements to enhance the movement of people and goods; Develop, evaluate, prioritize and build business cases for improvement options; and Amalgamate projects into an integrated investment strategy. Objective 1.5: Leverage available federal funding and administer costsharing programs to support and sustain B.C.’s infrastructure. Strategies Take a leadership position in partnership with other Provincial Ministries to support local government’s priority infrastructure projects. Goal 2: B.C.’s transportation sector is globally competitive. Objective 2.1: Develop Canada’s Pacific Gateway. Strategies Implement The Pacific Gateway Transportation Strategy 2012–2020: Moving Goods and People; and Undertake transportation trade network development and integration in conjunction with the Pacific Gateway Alliance, the private sector, other levels of government and First Nations to build capacity for long term growth. Goal 3: Reduce greenhouse gas emissions from the transportation sector. Objective 3.1: Increase transit use, cycling and other alternative modes of personal transportation. Strategies In partnership with other levels of government and with stakeholders, support provision of rapid transit and frequent bus service to make transit an attractive option; Invest in public transit infrastructure, where supported by strong business cases; Improve High Occupancy Vehicle (HOV) and transit priority measures; BCRPA - 2015 BC Provincial Budget Summary Page 13 of 14 Encourage compact and mixed land-use around transit stations and along transit corridors through policy and funding agreements; and Invest in an integrated cycling and walking network. Goal 4: B.C.’s highway system is safe and reliable. Objective 4.3: Improve highway safety and reliability. Strategies Monitor highway safety and improve high-risk locations in consultation with local and regional authorities and stakeholders; Maximize highway safety and reliability through both safety-focused enhancements and low-cost improvements, such as signs, lighting, and lane markings; Objective 4.4: Provide effective road safety enforcement, education and programs for the commercial transport industry. Strategies Establish and enforce regulations to enhance vehicle safety in B.C. and to ensure public safety; Participate with other jurisdictions on initiatives to coordinate and harmonize programs, policies and standards for commercial vehicles; Ensure information systems provide quality and timely commercial vehicle safety data for compliance and enforcement; and Build on existing technologies and policies to promote safety and improve efficiency for the commercial transport industry. BCRPA - 2015 BC Provincial Budget Summary Page 14 of 14
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