Finance Minister Katrine Conroy tables the budget as Premier David Eby looks on from the legislative assembly at the legislature in Victoria, on Feb. 22.CHAD HIPOLITO/The Canadian Press
Many in B.C. are still processing the shocking implosion of BC United, the province’s governing party for much of the early 2000s under its old name, the BC Liberals.
Badly trailing in the polls for months, United Leader Kevin Falcon put an end to his party’s election campaign last week, urging both his candidates and public backers to throw their support behind the Conservative Party of BC. Most in the BCU, including sitting MLAs and candidates chosen to run in October’s provincial election, were blindsided by the move.
The beneficiary of all this is John Rustad, the Conservative Party Leader. His party is effectively tied with the NDP according to a raft of polling heading into the fall vote. This is shocking given that many people don’t know Mr. Rustad or much of what he stands for.
He certainly is surfing a wave of enthusiasm created by federal Conservative Leader Pierre Poilievre. Undiscerning voters likely think that when you vote for the B.C. Conservatives you’re getting a provincial version of the federal party.
This isn’t true. And the NDP will make every effort to ensure British Columbians know Mr. Rustad is a climate-change skeptic whose party is littered with folks, including candidates, with some bizarre, dare I say deeply disturbing, views on a range of topics. We likely haven’t seen the best of what NDP research has dredged up on some Conservative candidates. That is being saved for the campaign trail.
All that said, it’s not like the Conservatives don’t have ammunition of their own. And if you were looking at NDP weak spots, you couldn’t find a better place to start than the province’s burgeoning debt.
The province’s Finance Minister, Katrine Conroy, recently released the audited financial statements for the fiscal year ending March 31, 2024. The document might as well have been printed in red ink.
According to the statement, the province recorded a deficit of $5.035-billion, which was about $800-million more than had been projected when the 2023 budget was tabled last year. Ms. Conroy trotted out a string of excuses for the growing debt and deficit: wildfires, hiring nurses, floods. Ignored was the fact the treasury collected an additional $2-billion more in revenue than was expected in the past fiscal year, which was more than enough to cover most of the emergency spending.
The fact is, the NDP love spending money. Check that: NDP Premier David Eby’s government loves spending money.
It was not this way under former premier John Horgan and his finance minister Carole James. They understood implicitly that the traditional knock against the NDP is that it’s a party of spendthrifts, and poor stewards of the treasury. To stay in power, Mr. Horgan understood he had to combat that perception by making balanced budgets a priority – which he did until the pandemic hit.
Mr. Eby was gifted a projected budget surplus of $5.7-billion by Mr. Horgan when he departed government in November, 2022. Instead of using it to pay off debt, he decided to spend most of it. Ms. Conroy’s budget update certainly indicates that there is no intent by her party to change course and become more fiscally responsible.
The updated forecast for total taxpayer-supported debt for 2023-24 is $71.863-billion. Under the NDP plan, it will rise to $126.499-billion in three years. The province’s debt-to-GDP ratio is 17.6 per cent for 2023-24 and is projected to rise to 27.5 per cent by 2026-27. Not a balanced budget in sight.
When Mr. Horgan took power in 2017, the province had one of the lowest debt-to-GDP percentages in the country at 14.4 per cent. That seems like a lifetime ago now.
Mr. Eby seems unconcerned by what the credit rating agencies think. Earlier this year, S&P lowered B.C.’s rating to AA- from AA and gave the province a negative outlook. Moody’s Investors Service also downgraded B.C.’s economic outlook, highlighting the dire debt situation. Noted economist Trevor Tombe has also called out the province’s finances, saying in a report released earlier this year that B.C.’s debt is “accumulating at a pace that cannot be sustained.” He said the province’s fiscal future was bleaker than Newfoundland and Labrador’s.
Mr. Rustad’s party might be an unknown quantity to many, but there is one thing that the Conservative brand has always stood for: strong fiscal management. The public doesn’t like hearing they need to tighten their belts and live within their means while the government is doing exactly the opposite.
In what most believe will be a close election, the Conservatives have been handed a winning issue. If the NDP loses because of it, they’ll only have themselves to blame.