Finance Minister Carole James at the B.C. legislature, Nov. 26, 2019. (Tom Fletcher/Black Press)

Consumer spending ‘cautious,’ B.C. finance minister says

Carole James sees housing sales pick up, resources in decline

The B.C. government continues to reduce its expected surplus this year, as consumer spending cools off and revenue from forest products and other resources declines.

Finance Minister Carole James released the province’s second quarter financial results Tuesday, showing $133 million reduction in expected forest revenues for the year ending next March. Coal, electricity and oil and gas revenues have also seen a reduction in revenue forecasts, with natural resource revenues in general down $235 million from the first quarter estimate.

Income tax revenue forecasts are up, based on B.C.’s continued strong population and employment growth, but consumer spending is slowing down. James said that is due to economic concerns, both in B.C. and globally.

Retail sales grew by only 0.6 per cent during the first six months of the 2019-20 fiscal year, continuing a slowdown from 9.3 per cent growth in 2017 and two per cent last year. The slowdown is primarily “a decline in housing-related spending and new vehicle sales,” James said.

Average home sale prices fell by 3.3 per cent up to October 2019, after a slight increase in 2018. Housing starts are up so far in 2019, with 45,112 starts so far in 2019 compared to 40,857 in 2018.

RELATED: ICBC improving, still not out of the red, minister says

RELATED: Population, low mortgage rates drive housing recovery

Revenue forecasts for the B.C. Lottery Corp. and Liquor Distribution Branch are down from the September forecast, with lower casino revenues and sluggish sales for legal marijuana in B.C. James said there is some improvement in sales from B.C. Cannabis and private retail stores, but it is too soon to say if the province will break even on cannabis sales in the current year.

“B.C. Liquor Distribution Branch net income forecast has declined $18 million due to the delayed rollout of private and public cannabis stores and lower than anticipated demand,” the second quarter report states.

James said other cost-saving measures are in the works for ICBC, which saw billion-dollar losses the last two years before a cap on “pain and suffering” awards and diversion of smaller injury claims from court took effect in April. The budget continues to carry a $500 contingency fund to cover ICBC losses this year, as higher premiums and a new risk-based rate system come into effect.

Overall, the province now projects a surplus of $148 million, down from $179 million in the September update.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Waterfront Gallery ends 2019 with Christmas themed members show

Over 70 artists are on display for the Christmas exhibiton at Davis Road School

Paul Manly votes against first Liberal confidence vote ‘based on principle’

Manly was the only opposition party member outside the Conservative party to vote against Bill C-2

ILWU Local 508 organized toy drive to support families impacted by WFP strike

The toy drive raised over $2,500 in cash, over $1,000 in gift cards, and a big pile of toys

Local family invites the community to enjoy their Christmas light display

Kelly, Carrie, and Vincent Giesbrecht spent the last month decorating their home for the holidays

The Russell Troupe finds a comfort zone in Chemainus

Family gathering with two parents and five kids a common scene around town

‘Not a decision I came to lightly:’ Scheer to resign as Conservative leader

Decision comes after weeks of Conservative infighting following the October election

‘British Columbians are paying too much’: Eby directs ICBC to delay rate application

Attorney General David Eby calls for delay in order to see how two reforms play out

VIDEO: Octopus, bald eagle battle after bird ‘bites off more than it can chew’ in B.C. waters

B.C. crew films fight between the two feisty animals in Quatsino off north Vancouver Island

Couple who bought $120k banana duct-taped to wall say artwork will be ‘iconic’

Pair compared it to Warhol’s ‘Campbell’s Soup Cans,’ which was initially ‘met with mockery’

Race to replace Andrew Scheer could be a crowded one

Many familiar faces, such as Maxime Bernier, Jason Kenney, Doug Ford and Kevin O’Leary, have said no

UPDATE: University student dies, another injured in car crash in Nanaimo

Students part of Vancouver Island University’s automotive program

Owner surrenders dogs chained up outside among scrap metal, garbage to BC SPCA

Shepherd-breed dogs were living in ‘deplorable conditions.’

B.C. plane crash victim identified; witnesses describe ‘explosion’

He was a flight instructor, charter pilot and owned an airstrip before leaving Alberta

Most Read