The NDP government’s 2024 budget features record operating deficits and surging debt loads. The document includes no mention of any plan to return to fiscal balance—or even to narrow the deficit. It moves B.C. decisively towards structural operating deficits, compounding future debt-management challenges and risking B.C.’s reputation as a fiscally top-tier jurisdiction with an excellent credit rating.
The eye-watering deficit flows from the government’s plan to deliver sizable spending increases as revenue growth slows. The government’s spending trajectory also “bakes in” and adds to record spending increases in earlier budgets, when the government opted to spend massive “windfall” revenues from supercharged resource revenues and a large but temporary lift to corporate income tax collections.
Budget 2024 also outlines a large $4 billion increase in taxpayer-supported capital spending from 2023-24, boosting capital outlays to $14.1 billion in 2024-25. The following year sees a further jump in taxpayer-supported capital investment to $15.1 billion before it eases back to $14.1 billion in fiscal 2026-27.
Ongoing deficits and steadily escalating debt servicing costs are not sustainable. At some point the province will have to restrain spending. It is worth noting that the spending trajectory in Budget 2024 has per-capita expenditures on health, education and social services flatlining or even declining slightly beyond 2024-25. That scenario strikes us as far-fetched given the current government’s track record and policy inclinations.