B.C. boasts of eliminating operating debt, but braces for 'ongoing risk' from ICBC
Finance Minister Carole James shares the second quarterly report on Monday, Nov. 26.
Published Monday, November 26, 2018 12:58PM PST
For the first time in more than four decades, the province is operating debt-free despite some financial challenges.
“We’re on a fiscally robust, positive course,” Finance Minister Carole James said Monday. “Our growth is strong and it’s stable. Our cumulative surplus across the fiscal plan has improved substantially despite lower real estate revenue and losses of ICBC.”
The second quarter outlook for 2018/2019 forecasts an operating surplus of $1.35 billion, which is $681 million more than what was projected in the first quarterly report.
The report found the rosy outlook is due to improved 2017 personal and corporate income tax revenues.
But the province is also predicting the property transfer tax revenues to drop by another $150 million and is anticipating another year of high Crown corporation losses.
The Insurance Corporation of British Columbia said it currently has posted a loss of $582 million in the first two quarters and is projected to lose $890 million at the end of the fiscal year.
Last fiscal year, ICBC had a posted net loss of $1.3 billion.
“ICBC continues to pose a risk to B.C.’s financial health,” James said. “These kinds of losses are the result of the last government completely ignoring the challenges at ICBC, but we are going to correct them.”
James said there is continued uncertainty with global trade and the cooling housing market.
To compensate for those risks, the province is increasing the forecast allowance by $600 million.