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MLAs react to “cautious” B.C. budget

Local MLAs Donna Barnett and Bob Simpson weigh in on 2013 provincial budget.

Weighing in on the 2013 B.C. budget presented by Finance Minister Kevin Falcon on Feb. 21, local MLAs agree finance minister Kevin Falcon is being “cautious,” but each interpret that caution from different angles.

Cariboo-Chilcotin MLA Donna Barnett said the budget was what she expected.

“It is one that is fiscally prudent and controls government spending while still looking after the health care and educational needs of our citizens. We all know we are in a time if we’re not prudent, what will happen down the road,” Barnett told the Tribune Tuesday. “Take a look at Greece, take a look at your European countries, take a look at Ontario, it’s in a mess, too.”

The B.C. government is restricting spending increases and keeping its small business income tax alive to meet its balanced budget target before the 2013 election.

Falcon presented his first budget, with a deficit of $969 million for the fiscal year starting April 1, as B.C. pays to end the harmonized sales tax. His three-year plan predicts a $154 million surplus in 2013-14 and $250 million surplus the following year.

To do that, the budget aims to hold government spending growth down to two per cent for three years, with most of it going to health and education. That leaves most other ministries with little or no increase for inflation, a restriction that is expected to reduce overall B.C. government staff from about 27,000 this year to 25,000 by 2014-15.

Falcon also reversed course on business taxes. The government has been promising for years that it would eliminate the small business income tax this spring, after lowering it to the current 2.5 per cent. Now it will continue at 2.5 per cent until B.C.’s financial picture improves.

The last scheduled carbon tax increase will go ahead in July, from 5.56 cents on a litre of gasoline to 6.67 cents. The budget holds that level while a review of the carbon tax program looks at the rate and offsetting income tax cuts.

Barnett said she’s pleased about the government’s plan to freeze the carbon tax and do a complete review.

“That’s been one of the issues in my riding that’s been loud and clear so I hope I’ll get an opportunity to participate in the carbon tax task force and I would like all my constituents to send me e-mails or whatever on the carbon tax. To me that’s a very big issue,” Barnett said.

Issues around permitting, assistance for predator control and help with the forestry industry are being addressed, Barnett said.

“Basically those are the same issues we’ve had forever and a day.”

Applauding some of the budget items as things that will help citizens, she honed in on the new home owner buyer’s bonus, the home renovation tax credit for seniors, and the arts and sports tax credit for children.

“I say it’s time for all of us to come to the table, stand tall, do the right thing, as Minister Falcon has done with this budget, take the hard road, but the high road and be fiscally responsible,” Barnett added.

While the Independent MLA for Cariboo North said at first blush Falcon’s budget is one for the times, the next few weeks will be spent looking at the budget line by line.

“I don’t blame the government for being nervous for looking at what’s happening over in Europe and the States and the possibility of the China bubble bursting,” Bob Simpson said Tuesday.

Referring to the Drummond Austerity Report for Ontario, Simpson said Falcon’s right to insist that it’s important for government to have that fiscal constraint lens on what it’s doing so it isn’t going down the path of other governments.

“Having said that, what the government is offering is not a new paradigm, as the minister tried to paint it. It’s still that paradigm of deregulation of reducing taxes and reducing the size of government,” Simpson suggested.

Countering Barnett’s suggestion that the budget helps families, Simpson said it goes after households by increasing MSP premiums again.

Falcon is also considering a one per cent increase in the general corporate tax rate to 11 per cent, but not for another year depending on financial conditions.

“I think that’s just wrong,” Simpson says. “I think our natural resources should come at a premium and part of that could be a one or two per cent lift in corporate taxes because people want to come here and get access to our minerals, oil and gas, and other natural resources.”

The budget also reveals a plan to sell B.C.’s liquor distribution system and warehouses to a private operator.  Falcon called the move “an opportunity to get out of a business we don’t have to be in,” as well as a way to raise money.

The government’s intention to liquidate government assets also raises alarms for Simpson.

“One person chimed in that they’re going to be selling the cutlery and china to pay the rent.”

At first glance Simpson said he doesn’t see money being allocated to the Ministry of Forests to take care of the forests, or education because “holding the line” on education or any budget is a cut because of inflation.

Simpson also is intrigued with the carbon tax review. If the government is going to look at its impact on the agricultural sector as a whole sector then it’s an important adjustment, he says.

“The minister’s correct in saying the reversion back to the PST compounded by the carbon tax is hurting our agriculture sector,” Simpson said, adding if it is the case, then the adjustment is welcome news for the region.

“He (Falcon) seems to think of the agriculture sector as the greenhouse sector in the Lower Mainland and if that’s all they’re going to do then I think that’s not fair. If they’re going to do something in agriculture they need to do it across the board.”

— With files from Tom Fletcher



Monica Lamb-Yorski

About the Author: Monica Lamb-Yorski

A B.C. gal, I was born in Alert Bay, raised in Nelson, graduated from the University of Winnipeg, and wrote my first-ever article for the Prince Rupert Daily News.
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