2014 Legislative Session: Second Session, 40th Parliament
HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

official report of

Debates of the Legislative Assembly

(hansard)

Tuesday, February 18, 2014

Afternoon Sitting

Volume 5, Number 8

ISSN 0709-1281 (Print)
ISSN 1499-2175 (Online)

TUESDAY, FEBRUARY 18, 2014

The House met at 1:35 p.m.

[Madame Speaker in the chair.]

Routine Business

Madame Speaker: Hon. Members, good afternoon. On behalf of everyone present, I would like to take this opportunity to welcome all the guests to the people's House of British Columbia.

Orders of the Day

Hon. M. de Jong: I move that this House at its next sitting resolve itself for this session into a committee to consider the supply to be granted to Her Majesty.

Motion approved.

Presentation of Estimates

ESTIMATES OF SUMS REQUIRED
FOR THE SERVICE OF THE PROVINCE

Hon. M. de Jong presented a message from Her Honour the Lieutenant-Governor: Estimates of Sums Required for the Service of the Province for the fiscal year ending March 31, 2015, and a supplement to the estimates for the fiscal year ending March 31, 2015, recommending the same to the Legislative Assembly.

Hon. M. de Jong moved that the said message and the estimates accompanying the same be referred to the Committee of Supply.

Motion approved.

Hon. M. de Jong: Madame Speaker, I move, seconded by the hon. Premier of British Columbia, that the Speaker do now leave the chair for the House to go into Committee of Supply.

Budget Debate

Hon. M. de Jong: The budget I am tabling today projects spending for the fiscal year ahead in the amount of $44.416 billion, with the details laid out in the fiscal plan and estimates that I have just tabled.

I actually thought about leaving it at that. Alas, convention and the gathering of this assembly in the presence of so many honoured guests would seem to demand a slightly more expansive recitation of this year's budgetary blueprint.

I embark upon that task with a measure of enthusiasm and pride, for there is a story that emerges from the charts, the graphs and the relentlessly clinical and unemotional tables of fiscal documentation that is very much worth telling. It's a remarkable story that British Columbians themselves have written, and it contains all the elements of a bestseller about life on the high seas of economic exploration — struggle and perseverance, suspense and ultimate success.

A decade ago aboard the good ship British Columbia, we found ourselves slicing confidently through relatively tranquil fiscal seas, navigating on the basis of sound, free enterprise–based public policy. The question was not whether the economy would grow but by how much; not whether the private sector would create jobs but how many; not whether we would have a budgetary surplus but how big a surplus. We spoke of the golden decade and, along with much of the world, presumptively contemplated a glittering horizon where the golden sun of prosperity would never set.

Then it all changed. As 2008 turned into 2009, the storm clouds gathered and burst with a ferociousness unseen for generations. The economic seas boiled. Ports of call no longer bustled with the same sounds of endless growth and expansion.

Most of the western world plunged into the worst economic recession of our time. Credit and capital disappeared. Businesses around the world, some centuries old, collapsed. Budget surpluses turned into budget deficits. Certainty was replaced by uncertainty, and people and families suffered.

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In British Columbia we were not granted immunity. As a trading province, the impact of the recession upon our traditional markets like the U.S. was immediate, and the consequences for B.C. businesses and their employees was profound — though, I must observe, less dramatic than it would have been if we hadn't taken steps with the private sector to begin the process of significantly diversifying our international trade portfolio. More on that in a moment.

But here is where we have distinguished ourselves as British Columbians from so many other jurisdictions. Our collective response to the challenges that have confronted us since the cataclysmic events of '08-09 will, I believe, leave a lasting, positive legacy and define for decades who we are as British Columbians.

While others have avoided or postponed the difficult decisions needed to ensure long-term strength and economic stability, British Columbians gave this government a very specific mandate and very specific instructions. Put simply, in preparing for the voyages that lie ahead, British Columbians have insisted that we demonstrate through our budgets that all of the costs associated with operating our ship of state today are being paid for today. British Columbians reject the notion of asking future generations to assume responsibility for budget deficits
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that result from a lack of fiscal discipline.

This government has heard what British Columbians have said, and the strength of our agreement with the straightforward proposition that government should not spend more than what they receive from the taxpayers is revealed in the fact that today, on behalf of the government, I am able to table a second successive balanced budget. In fact, the three-year fiscal plan I am presenting today actually projects surpluses totalling $841 million over the three years of the plan.

That doesn't mean it's all clear sailing. It doesn't mean everything here on out is going to be easy. In fact, to continue meeting our targets, we will have to rely on some more of that old-fashioned discipline that got us here in the first place. At the same time, with a balanced budget we do have a little more leeway to advance some key priorities — things like job growth, skills training and education, helping families build for the future and providing additional resources for those folks and families most in need.

Most certainly, we will continue to face significant challenges — some of which we know and some of which have yet to reveal themselves. But while other jurisdictions across North America lament their ongoing fiscal vulnerability and sail nervously through unpredictable seas in search of a safe harbour, we in B.C. can say with a measure of pride and quiet confidence: "We are that safe harbour."

Now to the numbers. As I did last June before laying out the numbers for the year ahead, I'd like to update members on where we are today. In that regard, Madame Speaker, I am obliged to you and my colleagues on the opposition benches for consenting to the use of some graphics, on the same terms as was the case last summer.

[Slide presentation begins.]

As I reflect back one year ago to the initial presentation of Budget 2013, I am obliged to concede to the House that I recall detecting a certain degree of skepticism — particularly from the opposition, as unusual as that might be — regarding our economic and fiscal projections. Now, some of that skepticism may have been understandable. We were in the final quarter of fiscal year 2012-13, and we were still wrestling with an operating deficit in excess of $1 billion. But we had a realistic and achievable plan to eliminate that gap, which we laid out in detail, and most importantly, we had the discipline to stick to it.

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Today I'm very pleased to report to the House that we are on track to meet our targets and end the current fiscal year with a surplus of $175 million.

Now, as you can see, that fact will grant us membership in a very exclusive club: provinces with a balanced budget. In fact, depending on what happens in Saskatchewan, it could end up being a fairly lonely club of one, but we wish them well. They, too, balance on a razor's edge.

Budgets are built on the back of economic forecasts — hardly an exact science — but I will say that officials within the Finance Ministry deserve credit and recognition for the skill they have demonstrated in peering into the economic crystal ball. For budgetary purposes, as members will see on the graph, we are projecting economic growth of 2 percent in 2014, 2.3 percent the following year and 2.5 percent in 2016.

These numbers are lower than the corresponding outlook provided by the B.C. Economic Forecast Council. Its 13 members, leading economists from several of Canada's major banks and private research institutions, meet with government every year before the budget to give us their best advice. None of this information, happily, will come as a surprise to the opposition Finance critic. He was there, and I thank him for taking the time to attend.

In fact, for the second year in a row, the process of securing advice from the Economic Forecast Council was conducted in a full public session. Though it was hardly a standing-room-only crowd, I expect that in the years ahead interest will grow, particularly given the specific linkage that has now been created between the work of the Economic Forecast Council and recently ratified public sector contracts.

Along with a more conservative forecast for economic growth, we have included two additional layers of prudence into this budget. First is a forecast allowance — a cushion, if you will — to guard against revenue volatility. That forecast allowance is $200 million in 2014-2015, $225 million in the following year and $325 million in the third year. Secondly, the fiscal plan includes contingencies of $1.275 billion over the three years, which includes notional allocations for public sector wage increases.

How reliable are the forecasts? Well, there are always fluctuations and always the unforeseen, but on the revenue side, I would submit that the methodology we employed this past year served us well, and we're using the same approach this year.

Going forward, over the term of our new three-year fiscal plan, we are projecting revenues to grow by an average of 2.6 percent per year and spending to grow by an average of 2.2 percent per year.

The graph is the answer to the fundamental question — keeping the revenue line above the expense line. That's the secret to a balanced budget. The end result, as members can see on the chart above, factoring in all other parts of the budget, will be projected surpluses of $184 million in 2014-15, $206 million in 2015-2016 and $451 million in '16-17.

Our preoccupation with fiscal responsibility reveals itself in several ways, although apparently not, as some had hoped, in shorter budget speeches. For example, contracts and wages for the hard-working women and men who serve our citizens in the public sector represent the
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single largest share, more than 57 percent of total provincial spending. On that topic, I want to again pay tribute to all of the parties who have worked diligently over the past four years in challenging, very challenging, fiscal environments and found creative ways to keep public services affordable.

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In this fiscal plan we're able to offer modest funded increases for longer-term agreements, with a potential growth dividend starting next year. Under this framework, people working in the public sector will share in the benefits of any economic growth above and beyond the projections of the Economic Forecast Council.

The message here is a relatively simple one. If we do better as a province, the folks on the front line delivering public services will also do better. That's good for the entire province because, at the end of the day, we are all in this together.

The results to date have been encouraging. Four negotiations representing six agreements have already been ratified.

For those still engaged in the negotiations, there may be at times a temptation to seek more than can be accommodated within the existing mandate and this budget. Let me say this, simply, in reply. Negotiations are always tough. That's the nature of the exercise. The government will continue to be guided by its belief that all of our public sector employees should be treated fairly and with respect.

That same notion applies to the hard-working taxpayers of B.C. who ultimately fund these agreements. Implicit in demands that extend beyond the mandate is the expectation that either the government will seek more from the citizens through tax increases, which we won't do, or that moneys will be taken from elsewhere in the fiscal plan in a way that would negatively impact services and programs in those areas. That, too, is something that we are hesitant to do.

I encourage employers and unions to seek agreements early in the mandate, since changes in economic conditions and the province's finance can rapidly affect the affordability of new agreements.

In pursuing further improvements to our management of the public's hard-earned tax dollars, we intend to act upon the recommendations of the Auditor General to change how cash is managed by schools, universities, colleges and health authorities. We call it the SUCH sector.

Discussions with these agencies are currently underway, with the objective of lowering overall borrowing requirements and saving millions of dollars in interest costs. Operating funding levels are not impacted — only the process of managing the substantial past accumulation of cash in the SUCH sector.

These and other savings options have arisen from our ongoing core review process, which continues and which we expect will reduce government spending by a total of $50 million in 2014-15 without compromising basic levels of service to the public.

Because we continue to maintain this kind of discipline, British Columbia also continues to enjoy the benefits of membership in another exclusive club — those jurisdictions with the highest possible credit rating, triple-A. Now, that's important because it is directly tied to our borrowing costs. Simply put, we get a better rate because we represent a lower risk. That translates into more money available for program spending.

Ontario has to pay 9.3 cents out of every dollar of revenue on interest. That's more than double what B.C. pays, at four cents for every revenue dollar. If we had Ontario's debt-servicing obligations, our debt-servicing costs would be about $2.2 billion more — that's $2.2 billion no longer available for public services in the province — and we would not be talking now, as a province, about the potential to reduce our debt and ultimately become debt-free.

You know, some people dismiss the idea of paying down our debt as being unachievable or even unwise. To them, I simply say: "Balancing the budget wasn't easy, but we've proven that it can be done. Paying down our debt will not be easy, but it, too, can be done — with discipline, with perseverance."

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To those who aren't persuaded by the argument that says the greatest gift we can leave our children and grandchildren is a debt-free future, I pose this question. Can you imagine the enhancements to education, health care and social services we could make with the more than $2.5 billion we presently spend on servicing our debt?

Our primary focus as a government has been and remains to work with the private sector to promote job creation. The benefits of employment to individuals, families and communities extend far beyond the monetary calculations. Since the recession we have set ambitious targets for job growth in B.C. Frankly, we haven't yet achieved those targets.

To be sure, strengthening the economy, stimulating growth and working with the private sector to generate new employment opportunities are all long-term initiatives. But no one ever achieved anything worthwhile by making excuses, and this government doesn't intend to make excuses. We believe that we can do better, and we intend to prove it. In partnership with the private sector, we will redouble our efforts to realize the objectives we set out in the jobs plan to attract investment, expand trade, foster growth and generate employment.

B.C. has led the way in Canada in reducing our dependence on a single market in the U.S. It hasn't happened by accident. It's happened through a series of government-industry partnerships and a decade of concerted efforts to build the British Columbia brand over-
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seas. We have established an ongoing and visible presence in key emerging markets through strategically planned trade missions, and we have focused squarely on two objectives: develop new markets for B.C. goods and services, and attract international investment into B.C.

We continue to see results. In fact, our exports to China have risen by over 600 percent in the past ten years. Thanks to efforts like our Dream Home Canada project in Shanghai, softwood lumber sales to China last year were well over $1 billion.

Even the manner in which we pursue our borrowing needs can be used to enhance overall economic growth. Three months ago B.C. became the first foreign government to issue bonds into the Chinese renminbi dim sum market.

The bond issue received an exceptional reception from investors around the world. The issue was quickly oversubscribed and raised more than $420 million. It also caught the attention of the international markets, raising the profile of British Columbia, particularly in Asia.

The Premier and the Trade Minister's mission to China shortly thereafter further enhanced our presence and continued to build relationships that can pay important dividends to B.C. and to Canada.

Chinese financial institutions, now the largest in the world, are actively pursuing the establishment of their Canadian and even North American headquarters right here in B.C., providing yet another source of foreign direct investment, not to mention the potential for economic growth and job creation.

Jobs in the finance sector aren't confined to large multinational banks. B.C. is home to one of Canada's longest-established, fastest-growing credit union movements. Recent shifts in federal taxation policy have had a disproportionate impact on these institutions. They approached the province on behalf of their members, and we are responding, sheltering them from the impact of a negative federal income tax change for another three years.

Recognizing the importance of the film and television industry, we are taking steps to ensure that Vancouver Island is seen as an attractive production option. We are extending the distant location tax credit to the capital region for any productions with principal photography beginning after today.

Consistent with the plan we put forward in the last election, we will also leverage the federal industrial and regional benefits program to attract global aerospace and defence contractors to B.C. We will invest $5 million over five years in partnership with the Aerospace Industries Association of Canada, Pacific division, to grow the province's world-leading aerospace sector and help attract additional global aerospace defence contractors to B.C.

Of course, any conversation about the future of B.C. must take into account the huge potential represented by liquefied natural gas — LNG There are some skeptics out there who question whether this industry is real and whether it will proceed in B.C.

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I can tell this House with confidence that this opportunity is very real. Even most critics are starting to acknowledge the growing body of evidence.

Seven companies already have their National Energy Board export licences. Three more are in the application process. Two LNG projects have entered into an agreement with the province to pursue Crown land tenure for proposed development, and Kitimat LNG recently awarded an engineering procurement and construction contract for a possible plant at Bish Cove.

With this budget, we are providing additional funding of $29 million to the Ministries of Aboriginal Relations, Environment, Forests and Natural Gas Development to support the development of B.C.'s LNG industry. We will continue working closely with First Nations and communities to make sure that development aligns with theirs and the province's needs and priorities. That will require a tax regime to help ensure that the people who own the resource, the people of British Columbia, derive their fair share of benefits.

To this end, I am announcing today the government's intention to introduce legislation later this year setting out an LNG income tax regime. We are proposing a two-tier tax levied on net income from liquefication of natural gas at LNG facilities in British Columbia. We are proposing a tier 1 tax rate of up to 1½ percent that would apply at the commencement of production and a tier 2 rate of up to 7 percent that would apply once capital investment costs in the LNG facility have been deducted.

The rates will be finalized in the legislation we intend to introduce in the fall and will ultimately be determined by our ongoing analysis of global economic and market conditions, with a view to ensuring that B.C. remains competitive for investors and that British Columbians derive a fair return for the sale of the resource that they own.

You will note that we haven't booked any revenue from an LNG income tax in the current three-year fiscal plan. That's because the tax dollars won't start flowing in until the first plant starts production. But this is important. Other equally tangible benefits will begin to flow much sooner.

Even now, proponents are getting to work on site preparation. Employment is occurring. Land deals are taking place. As companies advance their projects, we will start to see dramatic results with hundreds of millions of new investment dollars, thousands of construction jobs, growth in local and regional economies, and higher government revenues and additional spinoff benefits.

After ten years of production, estimates are that a single LNG plant could generate in excess of $1.4 billion in LNG income tax alone. Those are numbers for just one plant. We have a number of proponents already engaged
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in the process, and I expect that skeptics are going to find it harder and harder over the coming years to deny that this is happening.

LNG is a brand-new industry that promises to open up new opportunities, especially for young people building careers and planning their futures. That's why the government is putting so much effort into working with employers, educators and communities to make sure British Columbians are first in line for the jobs of the future.

Our skills training plan, developed through a series of regional workforce tables and direct consultations, is built around four key areas of action, one of which is to invest and improve our training facilities. We're doing that at two levels — in high schools and in higher education.

For example, the new NorKam trades centre of excellence in Kamloops, scheduled for completion later this year, will offer courses in areas such as mining exploration, industrial skills and construction trades training. The new Alberni District Secondary School, opened in 2012, offers training options from heavy-duty mechanics and metal fabrication to culinary arts and hairdressing.

Those are just a couple of examples. In total, this new budget includes $1.5 billion in capital funding for school replacement and upgrading projects.

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It also includes $2.3 billion in capital spending by post-secondary institutions, supporting projects such as new trades-training facilities at Camosun College in Victoria, supporting an additional 370 students in the maritime, metal and mechanical trades by 2016; new facilities at Okanagan College, Kelowna, which will more than double the size of the current trades-training complex, again by 2016; and a new campus for the Emily Carr University of Art and Design. These investments help ensure that B.C. students have access to the programs they want, to help them build the skills they need.

To help ensure that they're able to afford that education, we're also moving forward with a program announced in last year's budget to help parents save. The B.C. training and education savings grant is a one-time payment for every child in British Columbia born in 2007 or later, whose family has a registered education savings plan in the child's name. In the year since we announced the grant, the number of B.C. families with RESPs has increased by 10 percent. That's an encouraging sign.

By the end of the coming fiscal year our intention is to work with the federal government to begin making payments worth $1,200 per child to as many as 40,000 eligible families every single year. Coupled with available federal support and with a very modest contribution from the family, the power of compounding interest over time will turn that one-time grant into, potentially, the opportunity of a lifetime.

It means that a student will be virtually guaranteed access to the training opportunity of his or her choice after high school. It means the financial impediment that for too long has held too many back will essentially disappear. It means that the story of the young professional hampered for years by the burden of student debt will become a lot less common here in British Columbia.

With this budget, we are also introducing legislation to implement the B.C. early childhood tax benefit. Starting in April 2015, the benefit will provide $146 million annually to approximately 180,000 families in B.C. They will receive up to $55 a month for each child under the age of six. Now, some might say that's not a lot. But for young families starting out, every extra dollar counts.

The tax credit isn't just a stand-alone benefit. It's part of the comprehensive early-years strategy announced in Budget 2013 to help parents balance the demands of work and family and to help set children up for lifelong success. The strategy includes new child care spaces, higher-quality services and a new early-years office to coordinate and provide better access to early childhood development services.

With this budget, we are also investing another $33 million over three years to help make the dream of home ownership more attainable. Effective tomorrow, February 19, the threshold for the first-time-buyer exemption from the property transfer tax will increase from $425,000 to $475,000. We estimate that will benefit about 1,700 additional first-time buyers annually, saving them up to $7,500.

There is a cost to government for these initiatives — of course there is — but these are the kinds of modest, targeted investments that not only make life easier for families; they also provide an additional measure of stimulus to local economies.

Along with creating a positive climate for economic growth and giving families more tools to build for the future, with this budget we're also making significant new investments in supports for those individuals and families most in need. Because of their circumstances, they may not be well positioned to benefit from new investment and economic growth. Now that we have room in the budget, we're putting more resources into the programs and services that so many families rely upon.

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First, we are providing incremental funding of $243 million over three years to Community Living B.C. to maintain services for adults with developmental disabilities and their families. With medical advances and an aging population, more people are living, happily, and living longer, happily, some of them with disabilities, and that's reflected in the growing demand for Community Living B.C. services in particular.

We're also providing an additional $15 million over three years to the Ministry of Children and Family Development to better support children and youth with special needs. This is in addition to the $70 million announced in Budget 2013 for the early-years strategy in
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2014-15 and '15-16.

We're making these investments now because we know from research and experience that children who get a good, healthy start in life tend to have fewer problems later on. That's why we continue to invest in programs like healthy families B.C. that promote nutrition and physical activity, helping children learn and adopt healthy habits that will last a lifetime. It's why this budget provides funding for the B.C. school fruit and vegetable nutritional program, which now includes milk, providing fresh, healthy foods to elementary schools across B.C. free of charge.

These programs are attracting attention from across the country because they work and because they represent a great investment, helping to ensure that the next generation has an even better quality of life than what we enjoy today. But the benefits of preventative health care reveal themselves in the longer term, and even with this emphasis on prevention, health care costs continue to increase.

Budget 2014 invests an additional $2.5 billion over three years in health care, but to keep health care services sustainable, we're asking those who can afford it to pay a little more. As signalled in previous budgets, Medical Services Plan premiums will increase by about 4 percent, effective January 1, 2015. That works out to $5.50 a month for a family of three or more. We'll also enhance our premium assistance program, which lowers or eliminates MSP premium costs for about one million lower-income British Columbians.

Now, for smokers, who continue to utilize a product that science, medical officials and common sense tell us will adversely affect their health and add to health care costs, I have some bad news. The price of cigarettes is going up. Effective April 1 the tax on tobacco will increase by 32 cents per pack. That is over and above the increase announced in last week's federal budget of 40 cents per pack, giving smokers even more financial incentive to quit.

We're seeing good results from B.C.'s smoking cessation program. We have the lowest smoking rate in Canada at 14.5 percent. But we know there's still more work to be done to help reduce cancer rates from tobacco and from other known causes.

To that end, the government is making a commitment in today's budget to provide specified funding for cancer research and prevention, and we will be working with the Canadian Cancer Society and other research partners to develop and implement a number of innovative cancer prevention initiatives that will reinforce British Columbia as a world leader in cancer research and cancer prevention.

Are there more ideas out there, more opportunities to spend? Yes, there always are, and sadly, the history of many governments has been to succumb to the temptation in circumstances where taxpayers can't afford it. That's bad leadership, plain and simple. It compromises future choices, and we're not prepared to do that.

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Instead, we are setting out a realistic, achievable three-year plan to keep British Columbia on course for the future we envisage, the future our citizens and our children deserve. It is, after all, the people of British Columbia whose hard work and perseverance have built our province. It's the people of B.C. whose values are reflected in this second balanced budget in a row.

As some have pointed out, I woke up this morning and was alive to the fact that 20 years ago I woke up for the first time as a newly elected MLA. Over the past two decades, from the unique vantage point afforded those of us fortunate enough to serve in this assembly, I have marvelled at the energy and the ingenuity of British Columbians.

It's that drive, that unrelenting optimism, that will propel us forward to establish more new markets and trading partners; to expand skills-training opportunities across B.C.; to attract new economic development, including an entire new industry in LNG; to work in partnership with the private sector to create thousands of new jobs in the years ahead. It's all there on the horizon, in our sights.

Our job as government is making sure that we stay the course. We do that by controlling spending, encouraging economic growth and working with the private sector to stimulate job creation — in other words, by sticking to our plan that is rooted in the commonsense proposition that guides families across B.C.: don't spend more money than you have. It may not be glitzy or chock full of goodies, but it's the right plan for British Columbia.

So it's all hands on deck. Together we built a solid ship that is the envy of so many, crewed by roughly 4.6 million British Columbians. With a steady hand on the tiller and under the banner of our second successive balanced budget, let us sail forward with pride and confidence into a future of growth, opportunity and prosperity.

[Slide presentation concludes.]

M. Farnworth: It's a pleasure to rise and respond to Budget 2014. This year's budget has two major components: families pay more and families will get less, as this budget ignores the issues facing average British Columbians and the families that make up this province. In fact, even their own promise from last week's throne speech are being ignored. As Harold Wilson once said, a week is a long time in politics, and this budget proves it.

Instead of a renewed investment in skills training, the budget proposes that secondary education will face cuts over the next three years, and skills training itself is flatlined. There also doesn't appear to be any new money to accommodate the government's commitment, made last week, around a violence-free B.C.

This budget makes no allowance for this government's
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reckless decision to play politics with our children's education. This year's health budget does not keep up with the pressures on the system and will force health authorities to make even more difficult decisions that will impact health services for patients across this province.

Meanwhile, families will pay even more for medical service premiums, ferry fares, home heating, hydro, tuition and basic car insurance. But before we get to exactly how much more families will pay, let's discuss how we got here.

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The simple fact is that this visionless budget is built on the backs of B.C. families as a result of this government's mismanagement and neglect.

Mismanagement of hydro, where this government gave sweetheart deals to their private-power friends that forced the province to buy power that we don't need at exorbitant rates and sell at peak periods for far less.

Despite these massive problems at B.C. Hydro and rates for British Columbians that will be jacked up by 20 percent over the next three years, the government is going to raid Hydro for $580 million — roughly $40 million more than last year.

They've mismanaged and neglected our forest industry, which has seen more than 70 mills close and the loss of over 30,000 forestry jobs.

In recent years we have been watching this government scramble to try and fix a massive backlog of mining permits as a result of constant reorganization of the natural resource ministries and thinning of key staff in those ministries. We've seen this government bungle countless projects, leading to well over $3.5 billion in cost overruns — staggering.

This government has absolutely failed to deliver on promised jobs. We all know now that B.C. is last in private sector job growth since the Premier made her original promise in September 2011.

In fact, one of the most shocking details in this budget is that the documents admit that the unemployment rate in this province will increase for each of the next two years. If that's not a damning indictment of this government's jobs plan, I don't know what is. This is despite the millions of taxpayer dollars spent on wasteful government ads before the election that made claims about job growth that were just not true.

British Columbians are looking for more than talk and expensive advertisements. They want to see real job creation, and it just isn't here. It's no wonder that thousands more people have, as the Premier would say in her own words, fled B.C. for other provinces in the last two years — again, a symbol of failure.

This budget is already showing signs of more mismanagement. While this government talks about LNG development opportunities, they're neglecting other critical areas of our economy. They're ignoring tourism, small business, forestry and technology.

They have already missed their targets on the LNG file. The LNG taxation framework promised to the public by the end of the last calendar year is late and still incomplete. This government's promise to have "at least one LNG pipeline and terminal in operation in Kitimat by 2015" has failed, and there are zero dollars in revenue in today's three-year forecast.

Judging from today's lack of LNG revenue, the Premier's promise to magically wipe away $70 billion worth of debts in 15 years is surely a fantasy. While this government campaigned on the issue of debt, what they didn't tell us was that they meant record-high debt as soon as the election was over. Debt-spree B.C. continues.

The budget shows that debt will climb to $68.9 billion, a $7.1 billion increase over the three-year plan. So here we are. This government has tabled a have-not budget that has nothing new to offer British Columbians; in fact, it takes away.

This budget cuts skills-training promises that the government made only a week ago in the throne speech. In fact, they've cut the post-secondary budget by $105 million over the next three years. There's no new money for skills training — flatlined, just like the jobs plan.

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They seem to have dropped their violence-free B.C. promise from only a week ago as well.

We already know about massive cuts to B.C. Ferries and how they're going to impact businesses and our coastal economy.

There's still no comprehensive plan to tackle child poverty, despite B.C. having the worst record for nearly a decade. While this budget shows that families will get less, it also shows that families will pay more. This budget makes…. Hard-working people are going to see themselves paying over $900 in fee and rate hikes after the three-year forecast of hidden taxes has taken effect.

Then there's another $32 increase for every round trip a family makes on B.C. Ferries. That's on top of the decade of massive and frequent ferry fare increases that have taken us beyond the tipping point, by this government's own admission.

Hydro rates are going to go up by an average of $207 for the average customer. Medical service premiums — up another $215 for families. Future ICBC rate hikes will add to this total.

Revenue from tuition is going up by $60 million this year, meaning students will find it even more difficult to get the necessary education for a good-paying job.

In the two years since the Premier took office, we've watched the gap between personal and corporate taxes widen by $1½ billion. We don't think that's fair on this side of the House. This government's budget relies entirely on nickel-and-diming away family budgets, already stretched thin from this government's previous budgets.

So when this government asks you to put yet another notch in your belt that has been tightened year after year,
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remember that it's because of their mismanagement and their misplaced priorities. If you can't afford shoes and need to resole old ones, remember that it's because of this government's failure to deliver on jobs, that it's their record on stagnant wages and a failure to implement a comprehensive economic plan with measurable targets.

If this budget were an Olympic event, I don't see gold. I don't see silver. I don't even see bronze. I see a failure to make the qualifying round.

I'll have more to say about this budget and the province's mounting debt at the next sitting, at which I reserve my right to continue.

M. Farnworth moved adjournment of debate.

Motion approved.

Introduction and
First Reading of Bills

BILL 8 — BUDGET MEASURES
IMPLEMENTATION ACT, 2014

Hon. M. de Jong presented a message from Her Honour the Lieutenant-Governor: a bill intituled Budget Measures Implementation Act, 2014.

Hon. M. de Jong: I move first reading of Bill 8.

Motion approved.

Hon. M. de Jong: Bill 8 consists of two parts. Part 1 has four provisions that will enable government's management of the 2014-15 budget. Part 2 amends 15 statutes in order to implement many of the tax measures in the '14-15 budget.

In part 1 the Public Service Benefit Plan Act and the Public Sector Pension Plans Act are amended to establish statutory appropriations for expenses resulting from unforeseen changes in the actuarial valuations of the long-term disability fund and the public sector pensions.

The balance in the First Nations clean energy business fund special account is increased by $1 million to provide additional resources for this initiative.

[1430]

Finally, at the request of its trustees, part 1 validates in legislation the Gwaii Forest Charitable Trust, established under agreement with the trustees in 2007, in order to ensure that the trust can continue to carry out its purposes.

In part 2 the Income Tax Act is amended to implement the B.C. early childhood tax benefit as announced in the June update 2013. Effective April 1, 2015, families will receive a maximum benefit of $55 per month for each child under the age of six.

Individuals and businesses also are supported through amendments to extend the B.C. mining flow-through share tax credit to the end of 2014 and to extend the scientific research and development tax credit for an additional three years.

As well, the Income Tax Act is amended to provide relief to credit unions from changes to corporate income tax policy announced by the federal government.

The Tobacco Tax Act is amended to increase the tax rate by 32 cents per pack, effective April 1, 2014.

The Provincial Sales Tax Act is amended to clarify the purchase price of accommodation that is purchased with meals and services for a single price, to clarify when the multi-jurisdictional exit tax is payable and to make a number of technical amendments to the PST for clarity and certainty, including related amendments to the B.C. Provincial Sales Tax Transitional Provisions and Amendments Act, 2013; the Special Accounts Appropriation and Control Act; the Sustainable Environment Fund Act; and the Transportation Act.

In part 2 the Carbon Tax Act and the Motor Fuel Tax Act are amended to clarify collector appointments and vendor penalties in order to facilitate vendor compliance with collector obligations. These changes also will clarify the assessment of interest consistent with similar provisions in the B.C. Provincial Sales Tax Act.

The Land Tax Deferment Act is amended to allow a property tax deferment agreement to continue when the property becomes subject to an easement. The Property Transfer Tax Act is amended to increase the fair market value threshold for eligible residential property under the first-time-homebuyers program. That increase will be effective for registrations made on or after February 19, 2014.

The Ports Property Tax Act is amended to extend the municipal tax rate caps and new improvement designations past 2018 and to extend provisions for compensation to municipalities.

The University Act and the Regent College Act are amended to ensure that property tax exemptions continue to operate as they have in the past.

Finally, the School Act is amended to eliminate the school property tax credit for class 5 properties as announced in June update 2013.

I move that Bill 8 be placed on the orders of the day for consideration by the House at the next sitting after today.

Bill 8, Budget Measures Implementation Act, 2014, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Tabling Documents

Hon. M. de Jong: I have the pleasure to rise to table the Budget and Fiscal Plan 2014/15–2016/17, which fulfils the requirements of section 7 of the Budget Transparency
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and Accountability Act. The budget and fiscal plan also contains the carbon tax plan required under section 3 of the Carbon Tax Act and other documents required under section 4 of the same act.

I also table, on behalf of the ministers responsible, the government's overall strategic plan and service plans as required under the Budget Transparency and Accountability Act. The service plan documents are presented in two binders.

The first binder contains service plans for the Office of the Premier and 18 ministries. The second binder contains service plans for 28 Crown corporations. The second binder also includes a list of organizations that are exempted from the service plan requirements under section 13 of the Budget Transparency and Accountability Act. Two organizations have been added to the list this year: the Provincial Capital Commission and Pacific Carbon Trust. These organizations will be wound up during 2014-15.

Finally, Madame Speaker, I ask leave to table to the House the PowerPoint presentation included in my budget speech.

Leave granted.

Hon. M. de Jong moved adjournment of the House.

Motion approved.

Madame Speaker: This House, at its rising, stands adjourned until 1:30 p.m. tomorrow.

The House adjourned at 2:34 p.m.

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