BC books a $13.8-billion deficit after gas-royalty correction lands

PENTICTON — Finance Minister Josie Osborne’s first quarterly report as Minister of Finance brought more bad news for British Columbia taxpayers..The Ministry of Finance posted the First Quarterly Report at 12:30 p.m. Monday. It books a $13.8-billion deficit for 2026-27, showing government spending far outpacing revenue gains and pushing the deficit well beyond what was budgeted in February.Osborne, a former Tofino mayor and marine biologist who inherited the portfolio August 14 after Brenda Bailey took medical leave, used the written release to talk less about the provincial government's finances and more about tariffs and “a stronger, more self-reliant economy.”“We know that U.S. tariffs and global instability are creating uncertainty for workers and communities across BC,” she said.“But BC is adapting, our exports are growing and we are reaching markets around the world.”.The numbers themselves tell a different story, however, with most of the province's financial woes appearing self-created.Natural gas royalties are down $531 million this year, from $1.297 billion in Budget 2026 to $766 million. The report says the correction of calculation errors in the February price forecast accounts for about $300 million of that cut. The rest is a lower private-sector price outlook and “the proposed new royalty framework’s latest design assumptions.”On September 1, Energy Minister Adrian Dix called the miss “a serious mistake, but it was a human error.” He said staff treated Canadian-dollar prices as US dollars and converted them again. Premier David Eby said that morning he was “not pleased by this situation.” On August 25 the same premier told reporters he was “not familiar with any error in the budget related to oil and gas revenues.”.Spending doles out even more damage to this year’s deficit. Statutory fire-management costs rise $614 million on top of a $236-million voted appropriation, for a combined fire forecast of $850 million. Refundable tax credits rise $458 million on higher claims for the capital-gains refund, the renter’s tax credit and production-services credits.Conservative finance critic Gavin Dew said the government is collecting more tax and still cannot hold the line. “This update shows they have both a spending problem and a math problem,” he said in a Monday statement.Dew said he was as concerned about Eby’s account of the royalty file as about the books. “The NDP can clean up their $1.5 billion forecasting error, but that doesn’t fix David Eby’s apparent lie about what he knew and when,” he said.Conservative Leader Kerry-Lynne Findlay, who previously worked as the Minister of Revenue under former Conservative Prime Minister Stephen Harper, said the update shows the NDP “continuing to spend beyond its means and pile debt onto future generations.”Through June 30 the operating deficit was $461 million, $402 million inside the first-quarter plan. The full-year forecast is still $450 million worse than February. Last year closed at a $7.7-billion deficit. Those result had help from a one-time tobacco settlement that is not coming back..The Eby government presented the quarter as “demonstrating the resilience of BC’s economy.” Dew, Findlay and the Canadian Taxpayers Federation are urging taxpayers to look past the spin."This update took a bad budget and made it even worse," said Carson Binda, BC director for the Canadian Taxpayers Federation. "The new numbers show that Premier David Eby has the budgeting skills of a college frat house.""The government found hundreds of millions extra and is still blowing past its budget," Binda further said in a statement released Monday afternoon. "BC doesn't have a revenue problem, we have a problem with a government that spends money faster than it makes it."The bulk of that spending increase is tied to compensation. Service delivery agency spending — covering health authorities, school districts, universities and colleges — is forecast $1.5 billion over budget, and the report attributes the increase directly to higher salaries and benefits paid out under the province's Balanced Measures Mandate. Health authorities and hospital societies account for the largest share, at $693 million over budget, followed by school districts at $328 million and post-secondary institutions at $222 million."Taxpayers can't afford the provincial government to be overspending by a billion dollars this year," Binda said. "High spending is driving up the deficit which means big interest bills for families."

BC books a $13.8-billion deficit after gas-royalty correction lands

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