The last budget before the provincial government goes into full election mode is balanced, although just barely, and addresses a couple of hot-button issues without throwing a lot of money around.
Medical Services Plan premiums are changing for most of us; whether you win or lose will depend on your income and the number of children in your household.
Premiums will be based on the number of adults in the household, so the rate for a couple is going to be the same as the rate for two single adults. The old discount for couples will disappear.
B.C. Finance Minister Mike de Jong says MSP premiums will rise by four per cent 鈥� which is not true for everyone. The increase will be much greater for some people.
A senior couple earning $51,000 a year pays $136 in premiums. That will rise to $156, an increase of 14.7 per cent.
It has been estimated that more than a million people will pay more, but two million people 鈥� more than 40 per cent of the population 鈥� will not pay premiums. Children will be exempted, and premium assistance will be increased.
De Jong has dismissed calls to get rid of the premiums by rolling health-care costs into general income taxes. He argues that doing that would result in a hidden tax, and would add 鈥渢o the illusion that health care is free.鈥�
That鈥檚 a stretch. The premiums cover less than 14 per cent of the $19-billion health-care budget.
The budget also takes on the overheated housing market on the Lower Mainland with a measure that will be felt across the province.
The property transfer tax has been removed on new houses valued up to $750,000. At the other end of the price range, the tax will increase to three per cent from two per cent on the portion of market value over $2 million.
As de Jong sees it, the goal is to make it easier for families to get into the market, and to spur construction of new homes.
As part of its effort to deal with high house prices, the province will require homebuyers to declare their citizenship and country of residence if they are not 91原创 citizens or permanent residents. Concerns have been raised that foreign buyers are fuelling house prices, and that many foreign-owned residences that sit empty for much of the year are driving up prices by eating into supply.
In time, we will have hard facts in a debate that has lacked them. What will the next step be? We won鈥檛 know what should be done, if anything, until the statistics are compiled. Note, however, that the government used to collect this information, but gave it up as pointless in 1998.
Out of the $47.5 billion in the budget, the government made the odd decision to deposit $100 million into a new B.C. Prosperity Fund. It is more a declaration of good intentions than a meaningful investment in the province鈥檚 future. That $100 million is too small to make a difference.
What is the point of taking money that could be used for debt repayment, and parking it in a fund for future debt repayment?
Although the budget is balanced, the province鈥檚 total debt will rise from $65.3 billion forecast for this year to $71.9 billion in 2018/19. That鈥檚 an increase of $6.6 billion. One reason for the increase is a planned $12 billion in infrastructure spending, with $8.2 billion of that to be borrowed.
The optimistic budget does not have a lot of wiggle room, so the government needs to count on a healthy economy, locally and globally, for it to succeed.
