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Economy

Fiscal update shows B.C. well-positioned amid economic uncertainty

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British Columbia remains well-positioned to continue supporting people and navigating emerging global economic headwinds with an improved second-quarter fiscal update.

Consistent with other jurisdictions, the Second Quarterly Report confirms a fast economic recovery has led to stronger-than-expected revenues in B.C.

The Province’s operating surplus is $5.7 billion, an improvement of $5 billion over the First Quarterly Report. The change was primarily driven by a significant update from the Canada Revenue Agency (CRA) for 2021 personal and corporate income tax results.

“The Second Quarterly Report shows that we have experienced a faster economic recovery than private- or public-sector economists initially forecasted,” said Selina Robinson, Minister of Finance. “The changes we’re seeing are primarily due to updated income tax revenue data from the Canada Revenue Agency here in B.C. and across the country – far beyond what was forecasted when we built our budget.”

B.C. continues to introduce new cost-of-living measures, including the new BC Affordability Credit announced by Premier David Eby last week. The total cost-of-living measures rolled out since the summer cost approximately $2 billion:

  • $395 million for ICBC rebates delivered in summer 2022
  • $64 million for the School Affordability Fund in fall 2022
  • $1 billion for Climate Action Tax Credit and BC Affordability Credit increases in October 2022 and January 2023
  • $320 million for a one-time BC Hydro bill credit for BC Hydro customers this winter
  • $100 million for enhanced BC Family Benefit payments from January to March 2023

In addition, families will begin saving up to $550 per month in child care costs starting in December 2022.

“We’re in a strong position to continue using the resources we have to deliver results on the issues that matter the most to people: housing; public safety; health care; climate change; and building a sustainable economy,” Robinson said. “No matter what is on the horizon, our government will continue to be here to support people in B.C.”

In the coming weeks, and as part of the budget process, the minister of finance will meet with members of the Economic Forecast Council and the ESG Advisory Council to discuss issues affecting the province’s economy and future forecasts. The Third Quarterly Report, including an economic forecast, will be released with Budget 2023 on Feb. 28.

Quick Facts:

  • The CRA provides provinces and territories with point-in-time data for personal and corporate income tax revenues.
    • Information for the 2021 tax year starts becoming available after tax returns are filed in the spring and summer of 2022, and final assessments are completed in March 2023.
    • The increased revenue data for personal and corporate income taxes in the Second Quarter reflect these updates from the CRA.
  • Year-to-date to October 2022, employment is up 3.4%, with the unemployment rate near historic lows at 4.2%.
  • Revenues have risen to $81.1 billion, while expenses have decreased to $75.1 billion since the First Quarterly Report.
    • Updated cost estimates for labour negotiations decreased by $1.1 billion in 2022-23, with higher costs in the next two years.
  • The taxpayer-supported debt-to-GDP ratio is projected to improve to 15.8%, from the 17% forecast in the First Quarterly Report and the interest bite for taxpayer-supported debt is the lowest it has been for more than 30 years at 2.3 cents per dollar of revenue.
  • Contingencies for pandemic and recovery, and flood recovery, in 2022-23 remain unchanged from budget, at $2 billion and $400 million respectively.

Learn More:

To read B.C.’s Second Quarterly Report, visit:
https://www2.gov.bc.ca/gov/content/governments/finances/reports/quarterly-reports

The minister’s PowerPoint presentation is available at: https://news.gov.bc.ca/files/Q2_2022-23_presentation.pdf

For information about new and existing support measures for B.C. residents, visit:
https://strongerbc.gov.bc.ca/cost-of-living/

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Economy

Mark Carney to lead Liberal economic task force ahead of next election

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NANAIMO, B.C. – Former Bank of Canada governor Mark Carney will chair a Liberal task force on economic growth, the party announced Monday as Liberal MPs meet to strategize for the upcoming election year.

Long touted as a possible leadership successor to Prime Minister Justin Trudeau, Carney was already scheduled to address caucus as part of the retreat in Nanaimo, B.C., this week.

The Liberals say he will help shape the party’s policies for the next election, and will report to Trudeau and the Liberal platform committee.

“As chair of the Leader’s Task Force on Economic Growth, Mark’s unique ideas and perspectives will play a vital role in shaping the next steps in our plan to continue to grow our economy and strengthen the middle class, and to urgently seize new opportunities for Canadian jobs and prosperity in a fast-changing world,” Trudeau said in a statement Monday.

Trudeau is expected to address Liberal members of Parliament later this week. It will be the first time he faces them as a group since MPs left Ottawa in the spring.

Still stinging from a devastating byelection loss earlier this summer, the caucus is now also reeling from news that its national campaign director has resigned and the party can no longer count on the NDP to stave off an early election.

Last week, NDP Leader Jagmeet Singh ended his agreement with Trudeau to have the New Democrats support the government on key votes in exchange for movement on priorities such as dental care.

All of this comes as the Liberals remain well behind the Conservatives in the polls despite efforts to refocus on issues like housing and affordability.

Some Liberal MPs hope to hear more about how Trudeau plans to win Canadians back when he addresses his team this week.

Carney appears to be part of that plan, attempting to bring some economic heft to a government that has struggled to resonate with voters who are struggling with inflation and soaring housing costs.

Trudeau said several weeks ago that he has long tried to coax Carney to join his government. The economist and former investment banker spent five years as the governor of the Bank of Canada during the last Conservative government before hopping across the pond to head up the Bank of England for seven years.

Carney is just one of a host of names suggested as possible successors to Trudeau, who has insisted he will lead the party into the next election despite simmering calls for him to step aside.

Those calls reached a new intensity earlier this summer when the Conservatives won a longtime Liberal stronghold in a major byelection upset in Toronto—St. Paul’s.

But Trudeau held fast to his decision to stay and rejected calls to convene his entire caucus over the summer to respond to their concerns about their collective prospects.

The prime minister has spoken with Liberal MPs one-on-one over the last few months and attended several regional meetings ahead of the Nanaimo retreat, including Ontario and Quebec, which together account for 70 per cent of the caucus.

While several Liberals who don’t feel comfortable speaking publicly say the meetings were positive, the party leader has mainly held to his message that he is simply focused on “delivering for Canadians.”

Conservative House leader Andrew Scheer was in Nanaimo ahead of the meeting to express his scorn for the Liberal strategy session, and for Carney’s involvement.

“It doesn’t matter what happens in this retreat, doesn’t matter what kinds of (communications) exercise they go through, or what kind of speculation they all entertain about who might lead them in the next election,” said Scheer, who called a small press conference on the Nanaimo harbourfront Monday.

“It’s the same failed Liberal policies causing the same hardships for Canadians.”

He said Carney and Trudeau are “basically the same people,” and that Carney has supported Liberal policies, including the carbon tax.

The three-day retreat is expected to include breakout meetings for the Indigenous, rural and women’s caucuses before the full group convenes later this week.

This report by The Canadian Press was first published Sept. 9, 2024.

The Canadian Press. All rights reserved.

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Economy

S&P/TSX composite down more than 200 points, U.S. stock markets also fall

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TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.

The S&P/TSX composite index was down 239.24 points at 22,749.04.

In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.

The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.

The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.

The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.

This report by The Canadian Press was first published Sept. 6, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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Economy

Here’s a quick glance at unemployment rates for August, by province

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OTTAWA – Canada’s national unemployment rate was 6.6 per cent in August. Here are the jobless rates last month by province (numbers from the previous month in brackets):

_ Newfoundland and Labrador 10.4 per cent (9.6)

_ Prince Edward Island 8.2 per cent (8.9)

_ Nova Scotia 6.7 per cent (7.0)

_ New Brunswick 6.5 per cent (7.2)

_ Quebec 5.7 per cent (5.7)

_ Ontario 7.1 per cent (6.7)

_ Manitoba 5.8 per cent (5.7)

_ Saskatchewan 5.4 per cent (5.4)

_ Alberta 7.7 per cent (7.1)

_ British Columbia 5.8 per cent (5.5)

This report by The Canadian Press was first published Sept. 6, 2024.

The Canadian Press. All rights reserved.

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