Finance minister Colin Hansen painted a grim picture of the provincial economy Wednesday afternoon, at a rare August cabinet meeting held just two weeks before the release of the B.C. budget.

Hansen told reporters that over the last three months, corporate and personal tax revenue has dropped by $1 billion. Resource revenues and other taxes were also down, Hansen said, by $1.2 billion.

"We are going into a budget two weeks today that is going to be a very, very difficult one," he said. "We are desperately trying to maintain the critical services in health care, education and social services."

The government has come under fire recently for a string of deficit-induced policy decisions - including cancelled surgeries, delayed MRI exams, the closing of Tourism B.C., and the implementation of the Harmonized Sales Tax.

Hansen says cuts are necessary because things are worse than anyone ever predicted.

"We're simply not going to be able to afford to do everything that we would have liked to have done," Hansen said.

University of Victoria political science professor Dennis Pilon says British Columbians are angry - but that doesn't necessarily mean there will be consequences for those in power.

"The government is pretty secure. It's got a long time before it has to go back to the electorate," Pilon said.

"There's really not very much the public can do except jump up and down and be mad."

The budget is being unveiled on September 1, and with revenue down - and costs, including $400 million in forest fire services, up - British Columbians should brace themselves for bad news to come.

With a report from CTV British Columbia's Jim Beatty