Taxpayer-supported debt decreased, and B.C. has the lowest debt-to-GDP ratio in the country
DESPITE global uncertainty, B.C. ended fiscal 2022-23 with a surplus and higher-than-expected revenue that the Province put to work helping people and communities with higher costs and growing needs.
“Inflation has been impacting people around the world, and many people here in B.C. are dealing with higher costs,” said Katrine Conroy, Minister of Finance, on Wednesday. “That’s why we chose to make smart investments that make a meaningful difference for people now and for the long term. We provided support for every community, took action to improve critical services, lowered costs for people, and we were able to significantly reduce the provincial debt.”
Public Accounts show B.C. ended the year with a $704-million surplus and no operating debt, as higher economic growth and healthy employment levels led to higher-than-expected revenue from income taxes and natural resources.
Many big corporations and high-income earners fared well through the COVID-19 pandemic and economic recovery. That increased income tax revenue was an opportunity to take action to defend people against the impacts of rising global inflation, through actions like providing affordability credits to 2.5 million people, boosting the BC Family Benefit, protecting rental housing and keeping ferry fares low.
Government also used additional revenue to strengthen services and build for the future, delivering new grants to growing communities to build the infrastructure they need, improving access to 911 services and investing more in cancer research to improve care for people.
“We’ve seen time and again that when we invest in people and the services they count on to build a good life here, it makes our economy stronger and more resilient,” said Conroy. “There are those who think that the best way to respond to global pressures is to pull back supports and cut services. We know that when we support and invest in people our economy and our province are strengthened.”
Total provincial debt decreased and the operating debt was eliminated. Taxpayer-supported debt decreased, and B.C. has the lowest debt-to-GDP ratio in the country. This puts B.C. in a stronger position to continue to invest in people.
The Province said that Public Accounts for the previous fiscal year are an important part of ensuring transparency and accountability within government’s finances. The next report on provincial finances will be the first quarterly report for 2023-24 in September.
To access Public Accounts online, visit: https://www2.gov.bc.ca/gov/
Public Accounts 2022-23
The B.C. government releases Public Accounts every summer to provide people with an accounting of provincial revenues and expenses from the previous fiscal year.
Budget 2022 prioritized government investments in areas needed to build a stronger B.C. and make life better for people, including investments to fight climate change and protect people and communities from climate-related disasters, helping with the cost of living by reducing child care costs, investing to grow an inclusive and sustainable economy, and continuing to strengthen the public services people rely on.
Budget 2022 estimated a deficit of $5.46 billion. The actual operating result was a surplus of $704 million.
Fiscal year-end revenues were $12.98 billion higher than the budget due to increased revenues in almost all categories as economic recovery improved.
Expenses were $7.8 billion higher than budget, including $2.7 billion in supplementary estimates spending.
Increased Revenue – $12.98 billion
* Personal and corporate income tax returns increased by $8.9 billion due to higher-than-expected revenues from big corporations and high-income earners, strong economic growth and employment.
* Natural resource revenues, primarily driven by natural gas prices, increased by $2.8 billion.
* Federal contributions increased by $1.2 billion, primarily from increased social and health transfers due to population growth.
* Net other miscellaneous revenues increased by $698 million.
* Revenue from commercial Crowns decreased as ICBC saw higher claim costs and declines in investment income. BC Hydro ended the year with positive, but lower than forecast net income as it supported people and businesses with affordability credits.
Increased Investments – $7.8 billion
* $2.7 billion in supplementary estimates:
* $75 million to accelerate existing reconciliation agreements with First Nations;
* $150 million for the BC Cancer Foundation;
* $100 million for a watershed security fund;
* $1 billion for the Growing Communities Fund;
* $450 million for Critical Community Infrastructure funding;
* $160 million for food security initiatives;
* $150 million for local, Indigenous and remote communities to get ready for Next Generation 911 services;
* $85 million for highway and community cellular connectivity;
* $45 million for public libraries; and
* $500 million to support BC Ferries fare affordability.
* $1.5 billion to help people with the cost of living:
* Increased Climate Action Tax Credit and BC Affordability Credits in October 2022, January 2023 and April 2023.
* $1.23 billion to protect renters by helping non-profit housing organizations purchase and preserve affordable and low-cost units and to expand shelter programs so that more people can access essential supports.
* $2.37 billion for other expenses, including $1.5 billion for new collective agreements for public sector workers, over $500 million for wildfire and emergency response costs and $375 million for refundable tax credits for people related to the 2021 tax year.
* The Province invested $6.76 billion in building hospitals, schools, public transit, roads and other infrastructure people depend on, $753 million more than the previous year.
Economic and Fiscal Highlights
* Provincial GDP grew by 3.6% in 2022, tied for fourth highest among provinces and equal to the national average. This was above the 2.8% forecast in Budget 2023.
* B.C.’s unemployment rate for 2022 was near record lows at 4.6%, supported by the continued recovery and population growth.
* Employment increased 3.2% in 2022; above the 2.8% forecast in Budget 2022.
* Total Provincial debt decreased year-over-year by $1.2 billion, and the operating debt incurred during the pandemic was eliminated.
* Taxpayer-supported debt decreased by $2.4 billion. Taxpayer supported debt-to-GDP ratio is 15.4%, the lowest in the country.
* B.C.’s credit ratings remain the highest in the country across the four agencies: Moody’s: Aaa; Standard and Poor’s: AA; Fitch: AA+; DBSR Morningstar: AA (high).
Public sector executive compensation for 2022-23
This is the 16th year the Ministry of Finance has disclosed the total compensation paid to senior management employees working in key decision-making positions throughout B.C.’s public sector. The annual disclosure reflects the compensation decisions made prior to March 31 for the fiscal year of 2022-23.
Public sector executives lead in the planning and delivering of services that support communities in every corner of the province as they help deliver funding and services in health, housing, child care and infrastructure. Total compensation reflects their responsibilities for improving public services, and contributing to making life more affordable while the Province is building a strong, inclusive, sustainable economy.
B.C. is a national leader in its reporting standards for executive compensation, which includes base salary, benefits (both taxable and non-taxable), perquisites, employer-paid pension contributions, allowances, including vehicle, retirement, long-service or any other payments such as merit/incentive-based pay, as well as an explanation of the compensation paid.
Disclosure statements can be found on the websites of the employers, as well as the Public Sector Employers’ Council Secretariat: https://www2.gov.bc.ca/gov/