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Tough sell for B.C. budget featuring tax hike, record deficit and construction delays

Click to play video: 'Cuts expected in today’s provincial budget'
Cuts expected in today’s provincial budget
WATCH: Cuts expected in today's provincial budget

British Columbia’s finance minister has started to sell her “tough” budget, but at least one business leader says Brenda Bailey should have made deeper cuts because of the “scary” deficit numbers.

Brenda Bailey told about 200 people at a Greater Victoria Chamber of Commerce event that the budget “lands in the middle” of those who say government should be making “big cuts” to health care, education and public safety and those who don’t want government to stop building.

But the chamber’s chief executive John Wilson said after Bailey’s appearance that the business community would have liked to have seen further cuts because the deficit, which is predicted to soar to a record $13.3 billion next fiscal year, needs to be “reined in very quickly.”

Bailey told the chamber that her budget will reduce the deficit “responsibly,” while “safeguarding” the core public services of health care and education.

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The finance minister says the government cannot cut its way out of the deficit, but it is instead making structural changes to the public sector and by slowing the construction of capital projects.

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She says government has made some small tax changes, and plans to raise additional revenue by “maximizing” BC’s natural resources through LNG projects, while “doubling down on mining,” especially in the area of ​​critical minerals.

The budget released Tuesday has drawn criticism from all sides with its soaring debt and deficit, public sector cuts, and construction delays for care homes, student housing and a cancer center.

Bailey said the budget is “serious work for serious times.”

It raises the base income tax rate by 0.54 per cent — the first increase in 26 years.

The government also plans to cut 15,000 full-time public sector jobs over the next three years.

BC Federation of Labor secretary-treasurer Hermender Singh Kailley is calling for transparency to ensure the cuts won’t affect front-line service delivery.

BC General Employees’ Union president Paul Finch says they wanted to see “strategic investment” in services that keep costs down but instead saw more cuts to the public workforce.

Finch says the province has broken a promise that keeping costs down could be achieved by “rightsizing” the ratio of management to front-line service workers, and it will be challenging to build an economy on a “weakened public foundation.”

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Bailey acknowledged the critics during her chamber appearance on Wednesday.

“I know this is a tough budget,” she says. “I firmly believe, though, that British Columbia is the place to be. We have everything to make sure that we can become self-reliant, that we can sell to the world.”

She rejected the suggestion that government could have raised additional revenues by taxing the very wealthy, including large corporations.

Government opted against that, because it would not have worked, she says.

“Jurisdictions that have attempted that have, unfortunately, seen flight of capital,” she said. “That’s not something that we are interested in seeing.”

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