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B.C. is flush, it’s time for more robust investment in the common good




Canadian Centre for Policy Alternatives

Can B.C. afford to make major new public investments to address crises in housing, climate change, health care, child care and toxic drugs, among others?

The simple answer is yes, can we ever.

A new report from the Canadian Centre for Policy Alternatives’ national office shows that despite dire predictions that the pandemic would be a big blow to provincial finances across the country, most provinces today have enough funds to pay for the important programs and investments that Canadians need to survive and thrive.

A close look at the most-recent figures from B.C.’s Ministry of Finance confirm that big action to address social and environmental crises is well within our power in this province. In fact, the extent of B.C.’s fiscal and economic latitude goes beyond that discussed in the national report.

First, there are huge pools of largely unallocated “fiscal padding” built into the BC government’s budget, amounting to $5.8 billion, $7.4 billion and $7 billion each year over the next three years, totalling $20 billion. This swamps the $5.1 billion in deficits projected cumulatively in that time.

These forms of fiscal padding tend to fly below the radar and are rarely reflected in headlines about BC’s fiscal situation. They have long been part of BC budgets—and long been problematic—but they have recently ballooned to multibillion dollar levels each year.

For example, in the current budget year, fiscal padding includes a $2.8 billion general contingency fund, $2 billion contingency for pandemic-related issues and $1 billion forecast allowance. In the following year’s budget plan, there is a $3.4 billion general contingency fund, $2 billion for unspecified “future priorities”, $1 billion forecast allowance and a $1 billion pandemic contingency fund.

The budget also adds an additional layer of padding by assuming a level of economic growth lower than private sector economic forecasters are projecting, which lowers revenue estimates.

This pessimistic skew in the budget numbers is why you often hear about “surprise” outperformance of budget projections at year-end. In 2021/22, the provincial government originally projected a $10 billion deficit, but by year-end this had turned into a $1.3 billion surplus. For 2022/23, the government originally projected a $5.5 billion deficit, but in its fall fiscal update only six months later it revised this projection to a $700 million surplus.

To be fair, the pandemic has created plenty of uncertainty, but this practice of budget lowballing is not new. The same pattern has played out in all but a handful of the past 20 BC budgets, with the year-end results turning out rosier than the pessimistic budget-day projections.

In fact, the only exceptions to this pattern were the year of the global financial crisis, the time when B.C. unexpectedly had to pay back the feds after eliminating the HST, and a small downward revision in 2019/20 at the very beginning of the COVID-19 pandemic.

Budget lowballing of this kind creates a systematic bias against public spending in BC, distorting democratic debate about the true range of our budgetary and public policy options.

If the goal is to prioritize avoiding deficits above all else, this practice would have some logic to it. But that’s an unwise priority. Whether or not the provincial government runs a balanced budget in a given year is not of any real economic significance. For healthy fiscal management, more relevant long-run measures include the debt-to-GDP ratio (debt relative to the annual income of the economy) and debt service costs (interest payments relative to the size of the budget).

Rather than consistent budget lowballing, BC should set realistic budget projections, recognizing there will be year-to-year fluctuations in both directions. Some years this may mean a larger deficit than expected, sometimes a smaller one, and sometimes a surplus.

More transparent and realistic budgeting would deliver important benefits. First, it would allow us to plan and make policy decisions that are more democratic based on an accurate picture of the resources available. Second, it would dial back the bias against public spending at a time when there is a huge backlog of critical public investments that need to be made.

Skewing the numbers to avoid fiscal deficits at all costs has meant neglecting mounting social and environmental “deficits”, which has helped create some of the big crises we face today. These deficits in social and environmental investment have been particularly severe for the past two decades since the social spending cuts of the Gordon Campbell government.

Beyond the year-to-year budget balance, another measure of our capacity to “go big” to meet these big challenges is public spending as a share of our total annual economic output.

Over the past two decades, BC’s provincial government operating spending has declined substantially as a share of GDP, from 21.5 per cent in 1999/00 to a projected 19.4 per cent in 2022/23. In fact, the most recent budget plans for this to decrease further to 18.6 per cent by 2024/25.

Notably, this picture of the decline is conservative because these figures assume that all of the contingency funds put aside for the upcoming fiscal years will be spent in full. If the contingencies aren’t spent, the projected spending levels for these years would be even lower.

To put this in perspective in terms of raw dollars, if B.C. returned to the spending levels of 1999/00 (as a share of GDP), we would have another $10 billion available to spend on important priorities in the current fiscal year alone (additional to the huge contingency funds discussed above). This figure would rise even further over the next two years.

If we want to increase public spending to tackle big challenges, we have the economic capacity.

How specifically could B.C. fund increased public spending and investment? Borrowing can play an important role and makes sense particularly when funding highly productive social and physical infrastructure investments. Indeed, some public investments—like a major build out of middle-class rental housing—can largely pay for themselves in a direct way.

Increased public spending can also be funded with more robust taxes on the rich, landowners, and corporations, with the dual benefits of raising revenue and reducing extreme inequality.

Even credit rating agencies—often very conservative institutions—recognize that raising additional tax revenue is well within BC’s capacity. For example, Moody’s notes that: “British Columbia’s level of taxation is at the lower end of the Canadian provinces, presenting the province the flexibility to raise taxes… while still remaining competitive with other jurisdictions.”

Besides being a moral necessity, tackling big social and environmental challenges comes with significant economic benefits. One area where this is now being recognized at the federal and provincial levels is the need for universal child care, but it’s also true across a range of policy areas. The flip side of the coin is that inadequate levels of public investment come at an economic cost. Shortchanging the public sector is economically and fiscally irresponsible.

If social and economic well-being each point to the need for increased public investment, what’s holding us back? Part of the story comes down to power. The status quo works well for the wealthy, who exert disproportionate influence in politics and sometimes block needed action.

Last year when economists, health experts and public opinion aligned in calling on the B.C. government to implement a minimum right to 10 paid sick days for workers, big business lobby groups were able to push the government to water down its policy to only five days (even as the pandemic was shining a bright light on the need for workers to be able to stay home when sick).

Another example is taxes on the wealthy. Despite enormous public backing for an annual wealth tax on the super rich at the federal level (nearly 9 in 10 voicing support in polling including 83% of Conservative voters), this policy has been nowhere to be seen, even though it would raise significant revenue and help tamp down the troubling rise in extreme inequality.

We live in an incredibly rich society, but too much of our prosperity flows to the wealthiest few, and too little of it is invested in addressing urgent challenges. This disconnect points to the need to build people power through labour organizing, direct working-class representation in politics, and innovations in our democratic system, among other strategies.

Building people power is no small task, but the fact that we have ample economic and fiscal capacity to invest in the common good should be heartening to organizers and bold politicians alike. Meeting this moment of crisis is within our grasp if organized people can overcome the power of organized money, as they have many times in the past.

Alex Hemingway is a senior economist and public finance analyst at the Canadian Centre for Policy Alternatives, BC Office.

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Investment regulator imposed $14M in enforcement penalties in latest fiscal year



TORONTO — Canada’s investment product regulator says it imposed more than $14 million in fines and other financial enforcements in its last fiscal year.

The Canadian Investment Regulatory Organization (CIRO) says the total also includes imposed costs and the forced return of ill-gotten profits.

The regulator says it also ordered suspensions and permanent prohibitions in a significant proportion of proceedings against individuals.

Enforcement efforts included a $2 million fine against Fortrade Canada for recommending a high-risk product to unsophisticated retail clients, and a $1.7 million fine and permanent ban on securities-related business against Paul Walker for a range of misconduct including soliciting more than $1.5 million in investments for an outside business activity.

CIRO was created at the start of 2023 through a combination of the Investment Industry Regulatory Organization of Canada and the Mutual Fund Dealers Association of Canada.

The new self-regulatory organization says it is focused on harmonizing its regulatory approach to create more consistency and timeliness with enforcement action.

This report by The Canadian Press was first published July 16, 2024.

The Canadian Press



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Conditions on Simandou investment now satisfied



LONDON, July 15, 2024–(BUSINESS WIRE)–All conditions have now been satisfied for Rio Tinto’s investment to develop the Simandou high-grade iron ore deposit in Guinea, including the completion of necessary Guinean and Chinese regulatory approvals. The transaction is expected to complete during the week of 15 July 2024.

Along with the recent approval by the Board of Simfer1, this allows Simfer to invest in and fund its share of co-developed rail and port infrastructure being progressed in partnership with Winning Consortium Simandou2 (WCS), Baowu and the Republic of Guinea.

More than 600 kilometres of new multi-use trans-Guinean railway together with port facilities will allow the export of up to 120 million tonnes per year of mined iron ore by Simfer and WCS from their respective Simandou mining concessions in the southeast of the country3. Together, this will be the largest greenfield integrated mine and infrastructure investment in Africa.

Rio Tinto Executive Committee lead for Guinea and Copper Chief Executive Bold Baatar said: “We thank the Government of Guinea, Chinalco, Baowu and WCS for their partnership in reaching this milestone towards developing the world class Simandou project.

“Simandou will deliver a significant new source of high-grade iron ore that will strengthen Rio Tinto’s portfolio for the decarbonisation of the steel industry, along with trans-Guinean rail and port infrastructure that can make a significant contribution to the country’s economic development.”

Under the terms of the transaction, Simfer will acquire a participation in the WCS project companies constructing rail and port infrastructure, commit to perform a portion of the construction works itself and commit to funding its share of the overall co-developed infrastructure cost, in an aggregate amount of approximately $6.5 billion (Rio Tinto share approximately $3.5 billion)4.

Chalco Iron Ore Holdings Ltd (CIOH) has now paid its share of capital expenditures incurred or required by Simfer to progress critical works up to completion. A first payment of approximately $410 million, for expenditures until the end of 2023, was made on 28 June 2024, and a second payment of approximately $575 million, for 2024 expenditures, was made on 11 July 2024. These amounts settle all expenditures incurred up to date.

The co-developed infrastructure capacity and associated cost will be shared equally between Simfer, which will develop, own and operate a 60 million tonne per year5 mine in blocks 3 and 4 of the Simandou Project, and WCS, which is developing blocks 1 and 2.

Under the co-development arrangement, Simfer and WCS will deliver separate infrastructure scopes to leverage expertise. Simfer will construct the approximately 70 kilometre Simfer spur rail line and a 60 million tonne per year transhipment vessel (TSV) port, while WCS will construct the dual track approximately 536 kilometre main rail line, the approximately 16 kilometre WCS spur rail line and a 60 million tonne per year barge port.

Once complete, all co-developed infrastructure and rolling stock will be transferred to and operated by the Compagnie du Transguinéen (CTG) joint venture, in which Simfer and WCS each hold a 42.5% equity stake and the Guinean State a 15% equity stake6.

First production from the Simfer mine is expected in 2025, ramping up over 30 months to an annualised capacity of 60 million tonnes per year5 (27 million tonnes Rio Tinto share). The mine will initially deliver a single fines product before transitioning to a dual fines product of blast furnace and direct reduction ready ore.

Simfer’s capital funding requirement for the Simandou project as a whole is estimated to be approximately $11.6 billion, of which Rio Tinto’s share is approximately $6.2 billion, broken down as follows.

US dollars in billions (nominal terms) Simfer


  Rio Tinto
Mine and TSVs, owned and operated by Simfer
Development of an initial 60Mt/a mine at Simandou South (blocks 3 & 4), to be constructed by Simfer $5.1 $2.7
Co-developed infrastructure, owned and operated by CTG once complete
Simfer scope (funded 100% by Simfer during construction)

Rail: a 70 km rail-spur from Simfer mine to the mainline, including rolling stock
Port: construction of a 60Mt/a TSV port

$3.5 $1.9
WCS scope (funded 34% by Simfer during construction)

Port and rail infrastructure including an approximately 552 km trans-Guinean heavy haul rail system, comprised of a 536 km mainline and a 16 km WCS rail spur

$3.0 $1.6
Total capital expenditure (nominal terms) $11.6 $6.27

Rio Tinto’s share of expected capital investment remaining to be spent from 1 January 2024 is to be $5.7 billion. Rio Tinto’s expected funding requirements for 2024 and 2025 are included in its share of capital investment guidance for this period, with project funding expected to extend beyond this timeframe.

Further details on the Simandou project can be found in the 2023 Investor Seminar presentation at

As Chinalco, Baowu, China Rail Construction Corporation and China Harbour Engineering Company are Chinese state-owned entities, and given Chinalco indirectly holds 11.2% of shares in the Rio Tinto Group, they, and WCS, may be considered to be associates of a related party of Rio Tinto for the purpose of the UK Listing Rules. Rio Tinto’s funding commitment pursuant to the infrastructure co-development arrangement (Rio Tinto share $3.5bn) is a smaller related party transaction for the purposes of Listing Rule 11.1.10R and this announcement is, therefore, made in accordance with Listing Rule 11.1.10R(2)(c).

1 Approval has been granted by the Board of Simfer Jersey Limited, a joint venture between the Rio Tinto Group (53%) and Chalco Iron Ore Holdings Ltd (CIOH) (47%), a Chinalco-led joint venture of leading Chinese SOEs (Chinalco (75%), Baowu (20%), China Rail Construction Corporation (2.5%) and China Harbour Engineering Company (2.5%)). Simfer Infraco Guinée S.A.U. will deliver Simfer Jersey’s scope of the co-developed rail and port infrastructure, and is, on the date of this notice, a wholly-owned indirect subsidiary of Simfer Jersey Limited, but will be co-owned by the Guinean State (15%) after closing of the co-development arrangements. Simfer S.A. is the holder of the mining concession covering Simandou Blocks 3 & 4, and is owned by the Guinean State (15%) and Simfer Jersey Limited (85%).
2 WCS is the holder of Simandou North Blocks 1 & 2 (with the Government of Guinea holding a 15% interest in the mining vehicle and WCS holding 85%) and associated infrastructure. WCS was originally held by WCS Holdings, a consortium of Singaporean company, Winning International Group (50%) and Weiqiao Aluminium (part of the China Hongqiao Group) (50%). On 19 June 2024, Baowu Resources completed the acquisition of a 49% share of WCS mine and infrastructure projects with WCS Holdings holding the remaining 51%. In the case of the mine, Baowu also has an option to increase to 51% during operations. After Closing, Simfer will hold 34% of the shares in the WCS infrastructure entities during construction with WCS holding the remaining 66%.
3 WCS holds the mining concession for Blocks 1 and 2, while Simfer S.A. holds the mining concession for blocks 3 and 4. Simfer and WCS will independently develop their mines.
4 A true-up mechanism will apply between Simfer and WCS to equalise most of their costs of constructing the co-developed rail and port infrastructure. The figures shown here are pre-equalisation.
5 The estimated annualised capacity of approximately 60 million dry tonnes per annum iron ore for the Simandou life of mine schedule was previously reported in a release to the Australian Securities Exchange dated 6 December 2023 titled “Simandou iron ore project update“. Rio Tinto confirms that all material assumptions underpinning that production target continue to apply and have not materially changed.
6 Ownership of the rail and port infrastructure will transfer from CTG to the Guinean State after a 35 year Operations Period, with Simfer retaining access rights on a non-discriminatory basis and at least equivalent to all Third Party Users.
7 By the end of 2023, Rio Tinto spent $0.5 billion (Rio Tinto share) to progress critical path works. Rio Tinto’s share of expected capital investment remaining to be spent from 1 January 2024 was $5.7 billion.

This announcement is authorised for release to the market by Andy Hodges, Rio Tinto’s Group Company Secretary.

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Rio Tinto plc
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Category: Simandou



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BlackRock Pulls Ad Featuring Trump Rally Shooter Thomas Matthew Crooks



A screengrab of Thomas Crooks from the BlackRock ad that aired in 2022.

Thomas Matthew Crooks, the 20-year-old who shot at former president Donald Trump at a rally in Pennsylvania, had briefly appeared in a 2022 advertisement for BlackRock Inc, the world’s largest money manager.

The ad, filmed at the Bethel Park High School in Pennsylvania, featured Crooks and several other unpaid students in the background, said the investment giant in a statement. Crooks graduated from the school in 2022.

BlackRock said it has pulled the ad but the video will be available to authorities. The ad, however, is being widely shared by social media users.

“The assassination attempt on former President Trump is abhorrent. We’re thankful former President Trump wasn’t seriously injured, and thinking about all the innocent bystanders and victims of this awful act, especially the person who was killed,” the company added in its statement.

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BlackRock, whose earnings figures are expected today, has faced scrutiny after shooting incidents since some of its index funds own shares in gunmakers.

Trump Assassination Attempt

Trump survived an assassination attempt on Saturday after a gunman opened fire at him at a rally in Pennsylvania ahead of the Presidential elections. The attack left him with a bloodied face as the former president said the bullet pierced his “upper part of right ear”.

Latest and Breaking News on NDTV

A bystander died in the attack while shielding his family and Crooks – a registered Republican – was shot dead by a Secret Service sniper.

Trump, whose Republican candidature will be finalised today, shared a message of unity after the attack and said Americans must not allow “evil to win”. “It was God alone who prevented the unthinkable from happening,” he said on social media.

Biden, too, appealed to the nation to “lower the political temperature” in a rare Oval Office address. “Politics must never be a literal battlefield, God forbid a killing field,” he said.

The US markets are expecting Trump trades to gain momentum after the attack. It has already been pinning hopes for the return of Republicans, especially after Biden’s poor performance in last month’s debate. Those trades are likely to take deeper hold as the attack sparks a wave of sympathy and support for Trump.


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