“We need to understand that we have a fiscal emergency.”
–John Rustad
Normally, a B.C. government can dine out on a new provincial budget for at least a month, teasing out the many programs, services and pots of money to maximum political effect. This week, not 24 hours after Premier David Eby dropped his new spending plan in the legislature, the first question he faced was: So, what’s next?
The evaporation of B.C.’s budget the moment it came into contact with the real world on Tuesday was a sign both of the fast-moving U.S. tariff situation, and the lack of new programs and services in the fiscal plan.
Without any tariff-related programs, Eby was quizzed Wednesday on the province’s plans for removing inter-provincial trade barriers (“I’ll have more to say about that very shortly”), provincial non-tariff retaliation (“we are working internally to make sure we have all the legislative authorities required to respond and retaliate to the Americans”) and support programs for those who might lose their jobs and businesses (“we’re in early conversations with the federal government about where these gaps need to be filled”).
“These tariffs that are threatening the livelihoods of Canadians and Americans cannot be allowed to stand,” Eby told journalists.
And yet, so far they are.
BC is vulnerable, says Opposition leader
The stand-pat nature of the new budget, combined with another record $10.9 billion deficit, highlight B.C.’s vulnerabilities in responding to U.S. President Donald Trump, said Opposition BC Conservative leader John Rustad.
“British Columbia is in an incredibly vulnerable situation,” Rustad said Wednesday. “We depend so much on the Americans for electricity we consume, for the gasoline that we use, for the food that we need, for healthcare services, there’s so many things we require Americans for. It puts us in a very difficult and weak position. Matter of fact, I don’t think I’ve ever seen British Columbia and Canada in weaker positions.”
For B.C.’s interior and north, forecasted declines in agriculture and forestry, on top of the tariffs, made for difficult budget reading, said BC Conservative Prince George-Mackenzie MLA, Kiel Giddens.
“For northern B.C. all we’re seeing is a managed decline of some of our resource sectors,” said Giddens.
“Whether that’s out in Kitimat at the smelter, or whether that’s a pulp mill in Prince George, or the oil and gas sector up in the northeast, across the north we’re more vulnerable than the rest of the province because we actually rely on these export-driven industries for our livelihoods.”
“All we’re seeing is a managed decline of some of our resource sectors.”
Kiel Giddens
“That’s the biggest thing when we talk about the north, it is that export base of the province that is going to be impacted by this. So there is a lot of angst. And I think people were looking for some sort of a signal that we were going to shift course and get a lot more done.”
More than 7,300 jobs were lost in the agriculture sector by the end of 2024, according to the budget, raising concerns about the viability of farming and ranching, said Giddens.
“Those cattle ranchers and farmers, the government’s message to them is we are projecting job losses and we’re not going to say anything in the budget either, we’re just going to have the numbers,” he said. “That’s pretty concerning.”
No transportation spending in north
There’s also little in the capital plan for the north, said Giddens. “There was nothing north of Prince George that is included in the transportation capital budget, nothing on Highway 16, nothing on Highway 97,” he said.
“That’s a pretty critical economic corridor.”
Giddens cited lack of progress on replacing the Taylor Bridge, between Dawson Creek and Fort St. John, which the government is still studying but was promised in the Conservative election platform. No money was allocated in the budget.
On the flip side, Giddens said he was pleased to see the much-needed University Hospital of Northern B.C.’s new patient care tower in the budget for 2031, with its dedicated cardiac unit, after years of promises.
Accelerate LNG, reform forestry, scrap carbon tax, says Opposition
The record $10.9 billion deficit projection for 2025-26 was alarming, and combined with last year’s more than $9 billion deficit, along with two additional future years of projected deficits, has put British Columbia in the wrong position to respond to the Trump tariffs, said Rustad.
“We need to understand that we have a fiscal emergency,” Rustad said Wednesday.
“We introduced a budget yesterday with an $11 billion deficit, leaving ourselves vulnerable, not having the flexibility to be able to do things. We need to get our spending under control. We need to be able to make sure that we can invest into our economy and get things happening.”
Rustad called for acceleration of LNG projects, the re-opening of overseas trade offices closed by the NDP, new provincial port security, a crackdown on fentanyl and reforms to the forestry sector — none of which were in the provincial budget.
B.C.’s rapidly-rising deficit and debt raise serious questions about the NDP’s ability to afford its election promise to scrap the consumer component of the carbon tax.
The carbon tax is set to rise another $15/tonne on April 1, in line with federal increases, at which point it will be responsible for 21 cents per litre on the cost of gasoline, almost 26 cents per litre on diesel and 472 cents per gigajoule of natural gas.
The increase will add $665 million in additional revenue, to a total of $3 billion for the carbon tax in 2025-26. The government has been unable to say how much of that is from the consumer carbon tax that would be cancelled, versus the remaining polluter-based industrial tax. Regardless, the loss of revenue would be significant for a government already posting record losses.
“We are competing against Americans, we’re competing against other countries in the world that do not have a carbon tax,” said Rustad, who nonetheless urged government to follow through on its removal.
“It inherently is a job killer. We need to get rid of these sorts of things so that we can strengthen our economy and realize our full potential.”