What is NDP Premier David Eby’s government thinking with this new budget?
In the lead up to its release, Finance Minister Brenda Bailey suggested she would become “the least popular person in the province,” due to plans for a “tough budget.”
Which implied a major attempt to rein in B.C.’s deficit.
In fact, the budget brought in a new record expected deficit of $13.3 billion for next year, with only gradual reductions in deficit spending in the coming years.
Bailey was right, but not for the reasons she suggested. Almost everyone is upset – the budget pulls back on spending in areas like building new seniors care homes, while nickel and diming people by expanding the PST and making seniors’ property tax deferrals much more costly.
In other words, there’s something to annoy almost everyone, but not the radical action that would balance the books.
So why take this route? I have a few ideas about what they might have been thinking.
• Underpromise, overdeliver
This is a classic government budget tactic. The NDP government’s forecasts for economic activity are fairly conservative – if B.C.’s economy does better than expected, the government collects more taxes and suffers fewer costs, and maybe the deficit is only $12 or $11 billion next year.
That’s still not great, though.
• Mark Carney will save us?
A big chunk of B.C.’s economic destiny is tied to Canada’s overall policies. It’s possible that our banker prime minister will manage to revamp the national economy, even in the face of U.S. tariffs and disruption, and that this will benefit B.C.’s finances.
Carney’s plans for major national initiatives may also free up cash from Ottawa for projects that would have been previously fully or largely funded by Victoria – creating jobs and growth.
We’ll see.
• More cuts in 2027?
Let’s say neither of the above plans come to fruition – with the next provincial election in the fall of 2028, the Eby government still has a couple years left to take a chainsaw to the budget.
Conventional political wisdom argues against this – you’re supposed to do all the unpopular-but-necessary things in the first year of your mandate, not right before you go to the polls.
• Chickening out
It’s possible that the NDP leadership just couldn’t bring themselves to do mass layoffs and/or big hike taxes. I suspect there were draft budget plans that were much more aggressive. But the real pain it would have dealt to British Columbians was too much for the premier and cabinet.
• Trust the Conservative gong show
The last and most cynical possibility – although the NDP is unpopular, and this budget will do little to fix that, Eby may simply believe the opposition will remain less popular through to the next election in 2028. The B.C. Conservatives have been plagued by infighting, and they’re divided between those pushing hard on the NDP’s weak points versus those fighting culture war issues that don’t resonate with median voters.
So while this budget matters, electorally it will only matter as much as the opposition can offer a better alternative.