The impact of global economic instability has resulted in an $804-million decline in provincial revenues for 2008/2009. The decrease in projected revenues reflects weakening economic growth and a decline in commodity prices.

The Province’s second quarterly financial report shows an estimated surplus of $450 million in the 2008/09 provincial budget, down from the estimated $1 billion projected in the last quarterly report, said Finance Minister Colin Hansen. The surplus remains $400 million ahead of what was projected when this years’ budget was introduced. The second quarterly report also includes a $500 million forecast allowance in the
event of further deterioration to government’s fiscal position.

The report notes that recent private-sector estimates now project B.C.’s annual real GDP growth will be 1.4 per cent in 2008 and 1.3 per cent in 2009. “Although growth forecasts for B.C. are lower than previously
forecast, the overall growth outlook for B.C. in 2008 and 2009 at this time is projected to be more optimistic than Canada as a whole,” said Hansen. “The weaker economic outlook clearly means lower revenues going
forward, in excess of $3 billion over the three years of the current fiscal plan.”

The Second Quarterly Report 2008/09 is available online at: