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Budget surplus means B.C. on track to provide universal child care, but ICBC still losing money

Last Updated Jul 18, 2019 at 7:05 pm PDT

Finance Minister Carole James shares a laugh with a colleague before delivering the budget speech from the legislative assembly at Legislature in Victoria, B.C., on February 20, 2018. THE CANADIAN PRESS/Chad Hipolito
Summary

the operating debt has been eliminated for the first time in more than 40 years

Increased revenues due mainly to higher corporate, personal taxes along with the new speculation and employer health tax

Province says this will free up funding to build more affordable housing and make universal child care a reality

VICTORIA (NEWS 1130) — The latest Public Accounts report from the provincial government shows the operating debt has been eliminated for the first time in more than 40 years –which should help free up funding to build more affordable housing and make universal child care a reality.

Increased revenues of almost $3 billion–collected mainly from higher corporate and personal taxes along with the new speculation and employer health tax–helped create a $1.5-billion surplus.

Minister of Finance Carole James says ending 2018 with that operating surplus makes ten-dollar-a-day child care accessible to more families.

“It’s a long term plan. We have right now a number of, as you may know, a number of prototypes around ten-dollar a day child care that we will be evaluating and monitoring, so we can make sure that we’re doing this right and in a way that meets the benefits of the economy and meets the benefits of family and children and gives them the best start.”

She says increased revenues from taxation mean the NDP government’s still on track to make universal child care a province-wide reality by 2027.

“Well, remember it’s a ten year plan, so we are taking our time to make sure that it’s a made in BC model, that it’s done right to be able to make sure the quality is there. To make sure we have the child care providers in place…. I can’t tell you the number of parents who have approached me to talk about the difference it’s made in their lives. In some cases $350 a month off their child care bill and some cases much, much more than that.”

ICBC still in the red

She admits the Insurance Corporation of BC is still in trouble.

“The actual loss was $1.15 billion over this past year. They are continued to expect to run a loss this year in 2019-20 and then expected to see a turn-around in the year after, but again, I think we’re monitoring that very closely. It continues to be a large risk in the budget and it continues to be one that I’m paying very close attention to and I know the Attorney General is as well.”

James says work to make public car insurance more affordable for good drivers includes transferring ICBC’s pension and investment portfolio to another Crown corporation over the next few months.

“BC Investment Corporation has a great reputation around investing. ICBC’s numbers were very good around their investments, but it’s not their primary business.”

During a news conference in Victoria, James was asked if that means any jobs will be lost.

“We’re talking to each of the employees, so we’re providing support there. About 18 people in those positions and we’re providing support to look at who has the ability to be able to move in.”

James went on to say “no” when asked if she knows anything about possible plans to move ICBC’s head office out of North Vancouver.

Meanwhile, she doesn’t seem concerned about losing more than $300-million in tax revenue from real estate sales –thanks to BC’s hot market finally cooling down.

“Yes, we have anticipated a drop in the property transfer tax, but to build a budget and to build an economy on speculation in the real estate market on money laundering isn’t a longterm sustainable plan for British Columbians, so that’s part of the reason we’re investing in education, in child care and making sure that we have people who are able to get back into the workforce and that families have opportunities here because we believe that’ll create the longterm sustainable growth that we need, rather than a kind of speculative market that had, I believe, a crash coming when you look at those kinds of prices and when you look at the kinds of escalation you were seeing.”

James says “The previous government put maximizing property transfer tax revenue first, while owning and renting a home became further out of reach for too many people. We’re working to build a sustainable economy that works for people in the long run. We don’t believe in short-term gains at the expense of future generations. I’ll be watching housing trends closely and I’m pleased by the moderation we’re seeing in the market so far.”

Liberals say emphasis on surplus is misleading

The Opposition’s response to the release of the Public Accounts is to point out the finance minister failed to mention a promise made more than two years ago to give every renter a $400 rebate and get rid of portables at schools in Surrey.

Finance Co-Critic Shirley Bond says the forestry sector is in crisis and small business owners are being taxed into closing up shop.

“John Horgan’s 19 new or increased taxes are having a devastating impact on British Columbians, while their government refuses to lay out an economic or jobs plan. The NDP government’s primary source of revenue continues to the pockets of taxpayers.”

Despite BC Liberal claims the province is at risk of losing its Triple A status, numbers released Thursday by the Ministry of Finance show the B.C. economy grew an estimated 2.4% and has the strongest employment growth in Canada–posting the lowest unemployment rate of 4.7% in 2018 (marking a drop from 5.1% in 2017).

When asked if British Columbians should expect a break on taxes, James says she needs to be ready for a global economic slowdown.

“If that impacts British Columbia, again, we need to make sure that we’re building that prudence in, but in fact, we did just that in supplementary estimates.”

Thursday also marks the disclosure of salaries for any government-funded CEO’s collecting a base salary of at least $125-thousand –which is required under the Public Sector Employers Act.

The highest paid executives in B.C.’s public sector in 2018-19:

1. Thomas Bechard, president and CEO, Powerex
Salary: $358,800
Holdback/bonus: $540,000
Benefits: $19,348
Pension: $17,512
All other compensation: $2,839
Total compensation 2018-19: $938,499
Total compensation 2017-18: $898,258

2. Santa J. Ono, president and vice-chancellor, University of British Columbia
Salary: $470,000
Holdback/bonus: $0
Benefits: $11,931
Pension: $46,050
All other compensation: $73,791
Total compensation 2018-19: $601,772
Total compensation 2017-18: $595,848

3. Chris O’Riley, president and COO, BC Hydro
Salary: $365,190
Holdback/bonus: $34,223
Benefits: $29,273
Pension: $78,516
All other compensation: $47,698
Total compensation 2018-19: $554,900
Total compensation 2017-18: $529,184

4. Brenda Leong, chair, BC Securities Commission
Salary: $439,764
Holdback/bonus: $0
Benefits: $12,754
Pension: $43,317
All other compensation: $7,013
Total compensation 2018-19: $502,848
Total compensation 2017-18: $639,702

5. Ken Cretney, president and CEO, BC Pavilion Corporation
Salary: $247,797
Holdback/bonus: $173,872
Benefits: $13,254
Pension: $24,408
All other compensation: $13,620
Total compensation 2018-19: $472,951
Total compensation 2017-18: $372,453

6. Nicolas Jimenez, president and CEO, ICBC
Salary: $381,601
Holdback/bonus: $0
Benefits: $17,443
Pension: $67,257
All other compensation: $2,482
Total compensation 2018-19: $468,783
Total compensation 2017-18: $382,132

7. Andrew Szeri, vice-president academic and provost, University of British Columbia
Salary: $395,698
Holdback/bonus: $0
Benefits: $8,312
Pension: $38,620
All other compensation: $1,785
Total compensation 2018-19: $444,415
Total compensation 2017-18: $326,124

8. Andrew Petter, president, Simon Fraser University
Salary: $328,870
Holdback/bonus: $33,000
Benefits: $9,986
Pension: $32,468
All other compensation: $35,586
Total compensation 2018-19: $439,910
Total compensation 2017-18: $439,460

9. James Cassels, president and vice chancellor, University of Victoria
Salary: $378,388
Holdback/bonus: $0
Benefits: $7,318
Pension: $47,138
All other compensation: $135
Total compensation 2018-19: $432,979
Total compensation 2017-18: $423,215

10. Mark Poweska, executive vice-president, operations, BC Hydro
Salary: $285,667
Holdback/bonus: $54,303
Benefits: $20,484
Pension: $61,418
All other compensation: $874
Total compensation 2018-19: $422,746
Total compensation 2017-18: $405,720

Note: Total compensation includes base salary, holdback or bonus, statutory and health benefits and pension contributions, as well as other allowances and/or payments, which may include vacation payout, sick leave payout, vehicle allowance, paid parking, severance/salary continuance, retirement allowance, professional fees and administrative leave.

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