B.C. business groups are calling out the significant shortfalls in the B.C. Budget 2023, released on February 28.

The 2023 budget, the first for new Premier David Eby, features spending for important infrastructure, social and community initiatives but comes at the expense of addressing increasing cost pressures facing businesses and the province’s competitiveness.

The budget provides “little support to businesses who are struggling with the cost of doing business,” said Fiona Famulak, president and CEO of the BC Chamber of Commerce. “In order to have healthy communities, we need to ensure we have healthy businesses.”

Government has allocated $8.7 billion more in operating funding and will run deficits totalling $11 billion over the course of the fiscal plan. Capital spending on critical infrastructure, such as schools, transit, roads and hospitals, will reach a record $37.5 billion while the provincial debt is forecast to be $99.5 billion at the end of 2025/26.

“Of particular concern to small- and medium-sized businesses is the increase to the carbon tax of $15 per tonne per year through 2030 with little to offset the costs they will incur,” said Famulak. “This is going to impact our supply chains and raise costs of producing goods in British Columbia.”

There were some positive measures that include:

• $77 million towards increased investments to address delays in permitting approval in the natural resource sectors.
• Increased supports to address significant societal issues that have a direct impact on business, including housing, homelessness and mental health.
• $58 million directed towards speeding up foreign credential recognition for qualified professionals.

“This budget was an opportunity for government to help businesses navigate through and beyond a very difficult past few years. A step such as adjusting the Employer Health Tax threshold would have demonstrated that government is willing to address the challenges that many of our members face,” said Famulak. “Unfortunately, that opportunity was missed.”

The Greater Vancouver Board of Trade shared similar sentiments, issuing a letter grade of C- for the 2023-24 provincial budget.

“Our members had hoped for measures to offset the rising costs of doing business but found no relief in Budget 2023,” said Bridgitte Anderson, president and CEO of the Greater Vancouver Board of Trade. “Unfortunately, the budget is essentially silent on an economic strategy to attract investment, and increase our innovation capacity and competitive advantage. With a slowing economy and a growing population, we need a strong private sector and competitive investment conditions to increase prosperity across the province.”

Both organizations expressed optimism for the new Future Ready Plan, which will provide support to address critical labour force challenges.

The Business Council of B.C. (BCBC) also pointed out the budget’s significant shortfalls when it comes to addressing challenges facing businesses. The budget contains no substantive measures aimed at driving long-term economic growth, improving business investment conditions, boosting productivity, or reducing business costs.

“The bottom line is that Budget 2023 significantly expands the role, reach and cost of the public sector in the economy while offering little new to support the prosperity of businesses or families in British Columbia,” said Ken Peacock, BCBC’s chief economist.

The British Columbia Construction Association called the lack of commitment to address prompt payment legislation a major failure because non-payment and late payments are “out of control, right alongside skyrocketing interest rates, cost of materials, and cost of labour.”

“The single biggest thing B.C.’s government can do for its 25,000 small and medium construction businesses is provide prompt payment legislation so that they will be reliably paid for the public and private projects they are called to build. No amount of infrastructure investment will succeed if we don’t reduce the pressures on B.C.’s builders,” said the association.

Cheryl Mah is managing editor of Construction Business.