3 Min Read
VICTORIA, British Columbia (Reuters) - British Columbia on Tuesday projected a budget surplus of C$264 million in fiscal 2016-17, the province's fourth consecutive balanced budget under the ruling Liberals, and unveiled measures to boost affordability in Vancouver's hot housing market.
The surplus is projected at C$287 million in 2017-18 and C$373 million in 2018-19, the government said. The revised surplus for 2015-16 is now seen at C$377 million, up from a previous projection of C$265 million.
The government attributed the stronger-than-expected performance to growth in retail sales, housing starts and employment, but warned that low commodity prices and slowing external demand will weigh on exports into the next year.
Finance Minister Michael de Jong also announced new measures aimed at tackling red hot real estate markets, mainly in the Vancouver area, including adding a higher tier to the property transfer tax and plans to collect citizenship data from home buyers.
The budget also included extra money for vulnerable youth and people with disabilities, more funding to support small towns' economies and cuts to medical premiums for lower-income persons.
De Jong's tone was muted on the nascent liquefied natural gas industry, as the government that pledged it would have three LNG terminals operating by 2020 is forced to come to grips with delays to projects proposed by major players like Malaysia's Petronas [PETR.UL] and Royal Dutch Shell.
"Though we have seen important and substantive progress in the development of an LNG industry in B.C, we have not included LNG projects in our projections at this time," said de Jong in his budget speech.
Despite not having a single natural gas export plant under construction, the province said it would launch a promised LNG Prosperity Fund, funneling C$100 million from the 2015-16 surplus into the account.
The fund - geared at reducing the provincial debt, investing in key services like healthcare and education, and saving for the future - is supposed to be funded by LNG taxes and royalties.
British Columbia, which has an AAA credit rating, said total debt is forecast to reach C$67.7 billion in 2016-17, C$69.9 billion in 2017-18, and C$71.9 billion in 2018-19. The debt-to-GDP ratio, which peaked at 17.9 percent in 2013-14, is expected to fall to 16.3 percent in 2018-19.
Editing by Alan Crosby and Sandra Maler