If British Columbia was a Business, It would be Bankrupt

On Wednesday February 16th, 2011 BC Finance Minister Colin Hansen announced British Columbia’s Provincial budget. The most interesting fact I take out about reading the budget that BC budget is running on deficit.

Current Provincial debt stands at about $53 billion and in two years time, it could reach $60 billion.

If a CEO or Manager decides to run a business like the way BC Provincial Government running the Province, they would have been fired long time ago and probably the business would go out business too.

There is no plan in the budget, to reduce the deficit of $53 billion.

Of the $41.92 billion total spending, $17.48 billion or 41.7% of the total budget will be spent on Health Care (no wonder employees in the health care industry make a good living). In the coming years, with the aging population, this share of health care spending will only go up. We are already hearing about not enough bed and service level in the hospitals. This will be a nightmare situation in few years. Downtown’s St. Paul hospital came out with their demand for $610 million for the renovation of their property. By the time, they get the funds and start work; the budget could easily reach $1 billion.

So, what will happen in the coming years to BC budget? They must work on reducing the deficit or become a state like California.

The deficit can only be reduced by increasing the Tax or spending cuts. One of these must happen in coming years if BC wants to keep a good credit score. The alternative will be is what is happening in USA right now. Do you want to see your Province drowning in debt? Or do you want to pay higher taxes to bring the Province’s deficit down?