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With a federal election campaign in full swing, and the daily tariff debacle, it is easy to lose sight of how the BC NDP recently tabled the largest deficit in B.C. history and are sinking the economy.
The NDP has virtually doubled the provincial debt in the nearly 10 years it has been in power. It means each of us owes about $20,000. You’d think this might be a big deal, but few barely noticed. Ditto our credit rating, which was dropped again on Thursday. Fourth time in as many years. This will have a significant impact on our cost of borrowing. It means more money going to interest, instead of back to taxpayers or to services. Negligible media coverage that was gone by the end of the day.
As a result, we have a big challenge, and it is twofold.
First, this is not a deficit designed to encourage growth, kickstart the economy or put money back in the pockets of hard-working British Columbians—while troublesome long-term, that might have been palatable, at least to some. No, this is a fully structural deficit, meaning that as a province we are simply spending $10 billion per year more than we have, and we plan to keep spending. (The government forecasts $10.2 billion the year after and then $9.9 billion the year after that).
Essentially this is the governmental equivalent of spending more on avocado toast than you make in your first job. When millennials do it, we all roll our eyes, and when our kids do it, we sigh. Why are we OK with our government doing it?
Second, we’ve become comfortable spending more than we earn. As any hard-working taxpayer will tell you, when you live on your credit cards and something goes wrong, you’re up the proverbial creek without a paddle. Actually, you had a paddle but had to sell it to make the minimum payment on your credit card. Our provincial debt is nothing short of breathtaking—and then along came tariffs. Creek. No paddle. Worse still, no plan.
Meanwhile our economy continues to flounder with only a trickle of the NDP’s highly touted election promises being delivered. Unemployment is rising steadily, our forestry industry is in imminent threat of complete collapse, and we still can’t work out how to activate our natural resource sector.
Here we are, so what do we do?
First, we need to put taxpayer dollars back into the hands of the British Columbians who have already paid them. By that, I mean that government needs to adopt a “Buy B.C.” mandate for itself, all our Crown corporations, agencies, health authorities and universities—effective immediately, even if it costs a little more. Require these agencies of government to apply for an exception if they want to bypass a source in B.C.
Second, fast-track natural resource permits. Take a page out of Saskatchewan Premier Scott Moe’s playbook when he said that “any application for a pipeline to cross Saskatchewan is hereby approved.” We have billion-dollar projects that have been stifled for decades. Hit go. Be environmentally responsible and work collaboratively with Indigenous communities. But hit go.
Third, freeze government spending at 2023-24 levels. It’s not fair that the government can spend more of your money while you have less and less of it. Remember there’s no such thing as government money. It’s money that taxpayers gave the government, or money that the government has borrowed and that taxpayers will ultimately have to pay back in the future.
Fourth, allow businesses to claim the PST as a tax credit, exactly as they do with the GST. Not only will this stimulate and reward their spending, but it will be another incentive for developers to build desperately needed housing.
Last, let’s embark on tax reform: Five per cent on income under $135,000, 15 per cent for income over $135,000. Everyone pays something. Everyone pays a little less. High income earners continue to disproportionately contribute. B.C.’s combined federal-provincial top rate is currently 53.5 per cent—higher than six provinces and all 50 U.S. states. In addition, B.C. maintains seven separate personal income tax brackets.
It’s time for B.C. to stop the avocado toast diet if it doesn’t have the dough to pay for it.
Full disclosure: I was the Conservative Party of BC candidate in West Vancouver-Sea to Sky last fall (unsuccessfully, and even though my mother says I was the runner-up, that’s just code for “I lost”).
Yuri Fulmer is chair and CEO of Fulmer and Company, based in Vancouver.
