BC NDP’s First Full Budget: C +

I like it … or at least much of it …  especially moves in the right direction in addressing the needs of more BC individuals/families economically in the middle income range.

And I say that …knowing full well that, among the NDP government’s first full budget, are a number of new programs/spending that won’t benefit me personally…

Like $1 Billion for expanded licensed day care; increased child care benefits up to $1,250 a month per child; funding to provide $350 a month cut in the cost of a child care space.   It’s about time … and a necessary move .. as young parents struggle to raise families in BC’s inflated housing market.

And speaking of housing … the Budget also made a few good moves to try to get a grip on our housing crisis: raising the foreign homebuyers’ tax to $20,000; introducing a speculation tax; and; boosting the property transfer tax on homes worth over $3 million to five per cent from three.  Flipping homes …or leaving them empty … hopefully won’t be as attractive anymore.

And, almost anticipating how off-shore  speculator buyers will just buy up properties outside the Lower Mainland, the government is expanding the transfer tax  to include homes in the Victoria-area, the Fraser Valley, the central Okanagan and the Nanaimo area. A good move for those hoping to get into that market without having to outbid so many foreign “investor” speculators.

Also drawing a lot of attention, a pledge  to build 114,000 new housing units over a decade for  families, seniors, and students.  Not enough in my view … and realizing there is a limit to how much public money can be spent on this…I would have also liked to have seen new incentives …write-offs, tax rebates, expedited processing deals with municipalities … for the private sector to build more NEW rental units.

In the meantime,  a lot of renters can’t wait: they’re hurting now …  a two-year rent FREEZE could still be done outside the budget on OLD rental housing, since it would have no direct cost to the government and would make up for the overly generous rent increases landlords have been allowed to impose year after year for the paste decade.

Some renters will also see a $930 per year increase to the rental income assistance program…. but MOST don’t qualify … so where is that $400 renter rebate promised before last year’s election????  The government should have done better for renters suffering NOW.

And then there’s MSP.

Yes, the government cut MSDP premiums in half last month, BUT now says it won’t get rid of the remaining terribly unfair tax until 2020. That’s too long to wait … especially since the government plans to have employers pay a new health premium tax beginning in 2019.

Getting BOTH the public AND employers pay MSP in 2019 is double-dipping …a cash grab that adds literally insult to injury!

Businesses, of course, won’t like several provisions of this NDP Budget: especially companies that will have to pay BOTH Medical Services Plan premiums and the new payroll health tax simultaneously.  I agree with them …. DOUBLE taxation for the same purpose IS excessive.

Add to that the fact that  businesses also face an increase on the carbon tax to $35 per tonne and an increase to the minimum wage to $15 an hour by 2021 … and the hints are already being heard: BC could again scare away jobs and industries … to Alberta or even Washington state!

And that would play right into the hands of Liberals … if the NDP’s ambitious spending plans fail; to come up with enough job growth and economic expansion to pay for it all.

Harv Oberfeld

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15 Responses to BC NDP’s First Full Budget: C +

  1. Gene the Bean says:

    Agreed.
    Steps in the right direction.
    I have full confidence and I’m sure everyone does that there is not a couple of Billion Dollar$ stashed away in a slush fund like the slimy BC Liberals liked to do.
    Wow. People with a moral conscious in government – what a change.

    Off topic- reading a number of op-Ed’s from major US newspapers this morning. Many say that if the anti assault rifle youth movement continues to pick up traction, the GOP is going to get slaughtered in 2018 mid terms. Many draw parallels to Vietnam War when the politicians didn’t care about mostly black young men dying every day, they were more concerned about their own jobs instead. The public finally revolted…. those that don’t learn from history are doomed to repeat it.

  2. harry lawson says:

    Harvey,

    This budget was nothing more then a vote for us budget. Deliverables several years to a decade away. More smoke and mirrors. Should the government fall there is their platform even if it is years down the road

    This budget failed the average renter. It has failed future renters. We need affordable rental stock. There was nothing to address that except for social and student housing.

    By not putting the foreign buyers tax province wide you nay just cause house price inflation in the non taxed area

  3. Peter w says:

    You must have given the BC Liberals an F the past few budget’s.

    (Response; Read my past blogs on the Liberals (and the NDP) … sometimes critical , sometimes in agreement …depends on the topic/issue. h.o)

  4. SG says:

    Unfortunately the foreign homeowners speculation tax will also affect Albertans buying vacation properties in some select parts of BC.
    https://www.theglobeandmail.com/news/british-columbia/canadians-with-bc-vacation-homes-to-be-hit-with-new-tax/article38061593/

    (Response: It shouldn’t matter whether buyers come from China or Alberta: If they buy BC property to use it, enjoy it or hold it for speculative purposes… but pay income taxes elsewhere …nothing wrong with rules to limit their impact. I pay higher taxes as an “outsider” in Florida than do locals …but have no problem with that. h.o)

  5. Rocker Rich says:

    Now if we could get an arsenic-free way to mine precious metals, maybe a new Klondike Gold Rush would help pay for these and future budget promises.

    Taxes on even the moderately wealthy must inevitably rise. But the key for the NDP or any political party is to encourage small businesses, especially in nascent sectors like alternative energy, to boost employment and the tax base. Easier said than done.

    Also, any Canadian political leader must pray that the US continues to keep recessions as long-ago bad memories. As history proves, an American recession squashes us like a bug.

  6. e.a.f. says:

    Harvey, that billion on child care benefits every one of us in this province whether they have children or not; even if their friends and family don’t have children.

    Children are the future of this country. If they get a good start in life, they will be less likely to mug you, when they’re older. Think of it as an investment in your personal safety as you age.

    The $400 renters “rebate” isn’t worth much in the grand scheme of things. Yes, it would help those who need an extra $400, but if you put all that money into one pot, you get a better bang for your buck. who knows it might even provide more affordable housing for some family with kids. that kid, who now goes to a decent day care and his parents can both go to work, thus providing him with a better standard of living and the employers of this province with more workers, who won’t be so concerned about where their kid is.

    Some rent freezes, child care, increase in min. wage, the money the feds send each month for families with children close to the poverty line, less MSP premiums, who knows some families might be able to live what we once considered a working class family life style.

    Yes, there will be grumbling the seniors didn’t get much attention, etc. but really, we’re at the end game. When was the last time you got mugged by a middle class senior?

    have to agree with Gene the Bean’s not on topic.

  7. Diverdarren says:

    Harvey, it’s the budget I’d expect to see from the NDP. Still short on fulfilling promises. 10$/day childcare, 400$ renters stipend.

    It’s the transfer of MSP costs onto the business that will probably lead to unintended consequences. If I had to suddenly cover the medical costs of my workers I’d
    1. Not expand over the 500k threshold. If I could avoid it.

    2. If the company was over the 500k and non unionized I’d be looking at wage freezes and rollbacks.

    3. If the company was union I’d look for 0-0-1 and 1.5% wage increases. That would balance my new government mandated cost.

    Rising costs and stagnant wages. Sounds like a NDP budget that will get the Liberals smiling for the next election.

  8. 13 says:

    The first budget would seem to be a leg up for daycare operators. It remains to be seen how this will help those in need of affordable day care. Will their be a means test or will the morally bankrupt greedy tax payers get the same treatment as the unfortunate single moms and the hard working families earning minimum wage and trying to pay rent in Vancouver.
    It seems that the tinkering around the edges of housing is high on taxation and short on enforcement. The greens , bless them seem to think that crashing the housing market is the answer (exciting to the max) but thankfully Carole James and co. seem to realize the devastation that a burst market would cause.
    We were told to wait for the budget and now we have to wait for the details on these huge and expensive programs.
    Small and even not so small businesses will be paying some new and exciting taxes on top of significant wage increases .
    Seems like the devil may be in the details. I think Ill wait and see how our economy reacts to these new and exciting changes.
    Also sort of off topic, well not really. Seems Mr Horgan has decided to bypass the drama and go straight to court to fight the Kinder Morgan Pipeline expansion. We will need to wait for the outcome and then balance the court costs against the final outcome. More exciting opportunities.

  9. D. M. Johnston says:

    The budget had to please Horgan’s base and the Greens and he pulled it off.

    I would think next year’s budget will be interesting.

    I also find interesting that the NDP have remained mute on the Mayor’s Council’s 10 year plan’s big projects; the Broadway subway FastFerry style fiasco; and Surrey’s road building project, masquerading as a light rail project. Combined, the cost exceeds $5.5 billion!

    The Pattulo is getting replaced, hopefully before a big wind storm blows it down and silence on the the Liberals great gift to the Port Authority a $5 billion bridge replacing the Massey Tunnel.

    I would call this a conservative budget.

  10. e.a.f. says:

    D.M. Johnston, #9, makes a very interesting comment regarding “muteness” in the budget– $5.5. b. make SNC Lavalin rich project.

    she called this a “conservative budget” AND she is quite correct, its a conservative budget and $5.5 B the mayors want to spend is anything but. The NDP’s budget will raise some “taxes”, however, where the money is going acceptable to most. Who can argue with child care, when last year we had a dead child in an unregulated child care center. Taking the MSP into line with the rest of Canada, some may not like it but the rest of Canada is doing it and not “ruining” their economy.

    Child care may even make some employer’s happy. Some of their workers may come back.

    The $5.5 billion the mayors want to spend smacks of B.C. Lieberal fun and games. Replacing the Pattulo bridge makes sense, to many, although I personally have a lot of confidence in that old bridge.

    Harvey, its interesting how little comment there is regarding the budget, thus far. either no one cares, or they can’t find too much to complain about.

    While Eby closes loop holes on money laundering, casinos, etc. the budget is going to make some people very happy and others not so much, but in the end, Eby may be able to close enough loop holes to bring in some extra cash or at least put a stop to the “game playing” in our province. Either way, we the people who live here pretty much full time, will benefit. It may slow the market, because flippers, foreign “investors/money launderers” will be taken out of the market slowly. No huge crash.

    They didn’t decide to bale out ICBC, that will be done over the years.

    B.C. Hydro, that will be interesting. Not so much in the budget about that, but the debt load is huge. Perhaps that is why the budget is “conservative”. of course we haven’t seen what Mr. Eby is up to yet regarding the fun and games there.

    In my opinion, Mr. Eby is going to be the most interesting person to watch in B.C. politics. If he cleans up the “corruption”, we may become more financially stable. Some may argue we already are, but if there is as much corruption going on as I believe their is, then we aren’t that stable. Yes, I include what went on at B.C. Hydro as “corruption”. Budgets don’t always deal with that sort of stuff, but it does have an impact on the amount of money a government has to spend on other things. IF the debt at B.C. Hydro is $60B plus, then that is money which can’t be spent on other things, because at some point it has to be paid back.

    (Response: I think the lack of responses is because there has already been so much said about it in so many places by so many. I find the strongest and most numerous responses I get are when I touch on a topic that is not being covered much or at all elsewhere or that hits a raw nerve, not previously exposed. ho.)

  11. Keith says:

    Pretty much agree on your take on the budget Harvey. I’m a bit troubled with upping the carbon tax. Unlike the lower mainland and the Island, most of B.C. and the folks that live there have longer colder winters and no alternative forms of transport, thus take on an unfair burden. At some point in the near future I would like to see demonstrated tangible results of the benefits of a carbon tax, not just “ hey everyone, it’s going up again”.

    In regards to the housing issues, and maybe this is already happening but we don’t know, coordination with the feds. and the Quebec connection in the dodgy ownership and purchases of properties. Focusing on the money is only one part of a bigger problem. Something for David Eby to look at.?

    We all have different takes on the first NDP budget and will have on future budgets, however, if they can get to a place where we can all have confidence in what they say about the true nature of B.C. finances that would be a big improvement on what preceded them.

    (Response: I agree…people can handle the truth: what most hate and resent is being lied to. Hopefully after a bad start (Horgan lied about election funding/donations and helped himself to major public funds soon after being elected) … the NDP will deliver the true picture of finances in real time …not suddenly find hundreds of millions to buy votes just before the next election,. h.o)

  12. Island Lookout says:

    VARIOUS INFLUENCES TO FLATTEN MANY BC DREAMS…SHORTLY

    This NDP budget is a disaster in the making especially for those who recently purchased real estate.

    While some social programs such as day care initiatives (institutional unionized babysitting) will be popular the housing “crisis”, is all of its forms, is the big dog here.

    For example, the various taxes and imposts announced all add up to way too much government interference in the private sector and our lives in general.

    THE major effect will be a flight of capital from BC and a “boycott” of capital inflows.

    What caused the theme of this budget was the 2008-9 world economic meltdown.

    Major central banks dropped interest rates to pretty much zero to restart growth.

    That’s happening and now rates are heading higher, relentlessly so as it will soon be evident.

    That means higher mortgage rates.

    Couple that with new property-related taxes, and other imposts by municipalties, and you get the picture.

    Business will take it on the neck, cutting jobs and reducing economic activity as a result.

    Then there is next Tuesday’s federal budget which hints at higher taxes for “successful” Canadian business people especially doctors and lawyers.

    These are the one percenters and they face very worrisome futures through higher taxation. How will that affect BC real estate?

    And look at the effects of that lower US tax rate. Does that mean some US businesses located in BC will move back south to a lower tax environment?

    It happened in Alberta very recently when a sunflower seed packaging plant closed down and 50 Albertans lost their jobs. The American owners just up and left. Period.

    And today there is a report that Canadian January manufacturing and home sales stats are down 14.5 per cent last month over a previous similar time frame. In other words our national economy is starting to cool.

    Then there’s NAFTA and the TPP. What’ll be happening there?

    The NDP has served only to endanger our economic futures.

    Like their NDP predecessors this crowd ALSO can’t run a peanut stand.

  13. 13 says:

    Isl. Lookout. The NDP could so run a peanut stand.
    They would require a warehouse staffed by BCGEU workers, all with FULL pensions and benefits. Then the peanut stand would need to be staffed by more BCGEU workers to unload the peanuts from the BCGEU drivers when the government trucks delivered the peanuts. The stands and warehouse facilities would be union built and state of the art.
    You will sleep better knowing that the BCGEU represents over 75,000 workers ( before the peanut stand, before the babysitting, before the government run marijuana sales and distribution and warehousing) . These 75,000 and growing members are against workplace bullies and are running ads telling us how they will stop work place bullying in BC. They dont explain how they will stop bullies in non BCGEU environments but rest assured they will all retire with excellent benefit plans that tax payers will fund forever. Thank God we wont be bullied. Can you lend me $50 for a bag of peanuts

  14. 13 says:

    Isl Lookout. Do you ever wonder why government after government after government seem to forget about seniors?
    Do you think it has anything do do with the fact that all 3 levels of government workers and all elected officials have indexed pension plans?

  15. Gene the Bean says:

    13-just pointing out the obvious.

    Grace us with your extended lifetime of wisdom as to who on the scene would be better than what we have…..

    tRump?
    Putin, who is changing the rules to be president for life.
    Xi of China, who is doing the same thing.
    The religious nut bar that currently leads the Cons?
    The socialist leader of the NDP who was more elected due to what he is than who he is?
    Christy?
    Gordo?

    Pick one. Who would be better for Canada right now?

    Or just continue griping and yelling at kids to get off your lawn….

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