New forecast expects provincial deficit to be $5.6B

The provincial government released its Q2 fiscal update on Tuesday, calling for a smaller deficit than previously forecast. The difference is due to bringing in more revenue from personal and corporate income taxes as well as $358 million in federal funding for wildfire recovery.

BC’s Second Quarterly Report now projects a $5.6-billion operating deficit this year, and an improved debt-to-GDP ratio of 17%.

Next week, BC’s Minister of Finance is scheduled to meet with the Economic Forecast Council to discuss next year’s budget, which will be released on Feb. 22. Traditionally, the minister addresses members of the Greater Victoria Chamber of Commerce shortly after budget day.

Among other highlights in the Q2 report were:

• Housing starts up 11.8% year-to-date with forecasts for 2023 and 2024 above the historical average
• Employment is up 1.4% year-to-date, including a net increase of 15,430 private sector and self-employed jobs.
• Net migration to BC in the first half of 2023 is up 25.1% compared to the same period in 2022.