Despite strong financial results in the first three quarters of 2019-20, unforeseen changes due to the pandemic, including declines in tax revenues, ICBC losses affected the province’s financial results.
“While the first three quarters of 2019-20 reflected a modest surplus and steady economic growth, COVID-19 led to lower tax revenues and losses at ICBC in the fourth quarter,” said Carole James, Minister of Finance.
“Despite the impacts of COVID-19, I am encouraged that B.C. continues to show positive signs, including improving employment numbers, robust capital spending, and the best debt affordability in Canada.”
The fiscal year ended with a deficit of $321 million, which is $595 million lower than the surplus projected in Budget 2019, mainly due to:
* costs related to B.C.’s initial COVID-19 response, such as public health measures;
* lower taxation revenue due to COVID-19; and
* a $298-million ICBC investment loss due to market conditions from COVID-19.
“The final quarter of the fiscal year brought many challenges,” James said.
“B.C. isn’t alone in facing these challenges, but we are in a strong position to weather them. The investments we made in 2019-20, such as eliminating MSP premiums and investing in child care and housing, will make life more affordable and support people through COVID-19 as the Province develops a strong economic recovery plan.”
The Public Accounts show the Province’s commitment to put people first through $3.4 billion in increased investments in health, community supports, education, and social services, and a historic $4.8 billion in capital spending for hospitals, schools, and highways.
In addition, the province remains in good financial standing with affordable debt levels at the end of the fiscal year and continues to lead the country as the only “AAA” accredited province.
Provincial gross domestic product (GDP) for 2019 grew by 2.8%, above the national average of 1.7%.
BC also maintained the lowest unemployment rate out of all the provinces in Canada during 2019 with a mark of 4.7%.