Kootenay West MLA and Finance Minister Katrine Conroy reported last week that BC finished 2022-23 with a $704 million surplus, although it was tempered by qualifications from the auditor general, who found “three significant errors that have not been corrected.” We spoke with Conroy, who took over the portfolio last year, shortly after she delivered the annual public accounts.
What were the highlights?
We had a $704 million surplus thanks to higher economic growth and healthy employment levels that led to higher-than-expected revenue. We were able to continue to support people last year, which is what we hoped to do. We’ve proven you can invest in people and not make cuts to services and still have a strong economy.
I’m wondering about the forecasting. Originally you expected a $5.5 billion deficit, then it went to a $6 billion surplus, then a smaller surplus. What are we to make of that?
Part of that comes from the tax returns we get from CRA. It’s hard to forecast when you’re looking at two years behind almost as to what’s going to come. There was substantially more income from higher-income earners and corporations. They did very, very well. We were getting the income from that. That wasn’t expected. Our economic forecaster as well as private sector forecasters were all in the same ballpark. It didn’t quite come to that number, it actually came to a much better number.
Is it like throwing darts though? What causes such dramatic shifts in the amount of money you think you might have?
It’s not quite like throwing darts. You also have to look at the global economy. The pandemic created difficulties for forecasters. It made it really tough because there were so many ups and downs within those few years. Forecasters thought during the pandemic people would go to ground and wouldn’t be spending much. But that didn’t happen. People were renovating their homes and fixing their yards because they were home. That created an economic benefit people hadn’t expected … But we are facing some substantial challenges. The wildfire situation in the interior is difficult. Global inflation is going to create issues as well as higher interest rates.
What is your philosophy if you show a surplus? Does that give you license to spend it or do you sit on it or a bit of both?
We have to be prudent. I’m a prudent person in the sense that you want to make sure you can support people but at the same time you have some funds you can put on your deficit. The fact we paid off our operating debt this year is significant. That was accrued during the pandemic. But we were also able to put money on the debt and support people significantly. We did many things toward the end of the year. Every municipality got some funding from us, a base amount of $500,000 and then more based on their needs and population. Every community and regional district got funds to invest in infrastructure. A lot of them did things to support housing, because that’s the big issue across the province.