Record revenue from B.C.’s real estate sector has helped the provincial government balance its budget yet again, though it may be the last time the housing sector delivers such a surprise cash windfall to the provincial treasury.
The property transfer tax accounted for more than $2.1 billion in revenue for the 2017/18 fiscal year ending March 31, according to government’s public accounts released Tuesday.
That’s $266 million more than government was expecting. It also includes extra revenue generated after Feb. 21 when government expanded the foreign buyer tax to 20 per cent and increased property transfer taxes on homes valued at more than $3 million.
Home sale taxes have proven a major cash cow for the government in recent years during B.C.’s red hot real estate market. The property transfer tax reached a record amount of revenue in Tuesday’s public accounts, and has grown 128 per cent since 2014.
The extra money was a factor in allowing Finance Minister Carole James to eek out a $301 million surplus in the year-end financial figures on a $51.7 billion budget.
But James acknowledged a softening housing market, as well as the NDP’s planned speculation tax, was driving down sales, prices and the property transfer tax revenue that the province has relied upon in the past.
“We want the market to moderate, we’ve been very clear about that,” she said. “We think that’s important not only for families and affordability but for our economy.
“Do I expect that there may be some change in the money that’s coming in? Yes I do.”
New figures on the slowdown will be released in September as part of the quarterly update to the current year’s 2018/19 budget.
Home sales in Metro Vancouver in July were at their lowest level in 18 years, and some realtors believe a significant decline in prices is quietly occurring in the market.
“Obviously we’re coming off the boil from the housing real estate boom,” said Jock Finlayson, executive vice-president for the Business Council of B.C.
“That’s clearly an area where the slowdown is very much in evidence in the Lower Mainland, and to some extent in the province, in sales activity. It’s going to pinch the government’s revenues for sure. Some of that I think they factored in their budget in February. The question is whether what’s happening now is a bigger downtown than what was predicted in the budget.”
James said she’s concerned the previous Liberal government relied too heavily on housing profits as its economic plan. However, her own budget for the current 2018/19 fiscal year also predicts a slight growth in property transfer tax revenue, to $2.2 billion.
“It concerns me that we don’t have a long-term stable plan for economic growth in British Columbia if we’re simply relying on money coming in on a speculative market,” said James. “That’s then causing problems for families, individuals, tenants, homeowners, businesses, recruitment and retention.”
The year-end financial figures showed a $1.3-billion loss by the Insurance Corp. of B.C., which the NDP has attempted to plug by instituting a cap on pain and suffering claims for minor injuries and an overhaul of insurance penalties for bad drivers.
James said the government also made a $950-million “adjustment” to its finances to address concerns independent Auditor General Carol Bellringer made about B.C. Hydro’s use of deferral accounts that push off expenses into future years. Hydro has $4.5 billion in deferral accounts remaining even after the change. The dispute with the auditor over Hydro’s finances delayed the release of public accounts by more than a month.
James blamed the Liberals for years of siphoning away dividends from Hydro, and said her government was trying to reduce the liability Hydro faces by addressing some of the problems now as it conducts a review of Hydro’s operations.
Liberal MLA Tracy Redies, a former B.C. Hydro board member, defended the use of deferral accounts. “This seems to be another contrived way of the NDP trying to make the previous government look bad,” she said. “I think it’s really wrong because deferral accounting is the standard practice used by utilities across North America.”
Other factors in the annual surplus included increased revenue from federal transfers, natural resources, liquor sales and other tax measures like the provincial sales tax.
Spending pressures were last year’s record wildfire costs of more than $560 million, as well more than $3 billion in new NDP spending on health care, education and social services.
The government absorbed $3.5 billion in debt from cancelling the tolls on the Port Mann Bridge, forcing the bridge to become a taxpayer-supported liability. Nonetheless, government actually decreased total provincial debt by $918 million and reduced its debt-to-GDP ratio to 15.6 per cent.
“Generally, B.C. is in reasonable shape,” said Finlayson. He said there remains “underlying fragility to the province’s finances” because it is at the peak of a larger economic cycle that may lead to a downturn and even a North American recession in the next two to three years.
Source: Vancouver Sun
Saudi medical trainees allowed to stay in Canada, for now
More than 1,000 Saudi Arabian medical graduates will be allowed to stay in Canada to complete their training, a much-needed reprieve for teaching hospitals that were unsure how they would handle the sudden and significant loss of staff.
Thousands of other Saudi students studying at Canadian universities will, however, still have to leave the country.
The 1,053 Saudi medical residents and fellows in Canada received an e-mail late Monday afternoon from the Saudi Ministry of Education “indicating that they may continue in their positions until an alternative assignment is arranged,” said Andrew Padmos, chief executive of the Royal College of Physicians and Surgeons of Canada.
The kingdom initially told the medical trainees to leave Canada by Aug. 31 because of a diplomatic dispute that erupted after Foreign Affairs Minister Chrystia Freeland publicly called on Saudi Arabia to release jailed human-rights activists. Last week, the deadline was extended to Sept. 22.
Residency and trainee programs begin every year on July 1, and those in the programs must complete at least six months to be eligible to write exams.
While Monday’s e-mail stipulates that the Saudi medical graduates are to remain in Canada only until they can find alternative arrangements in another country, in reality many of them will likely be able to complete their training here, said Paul-Émile Cloutier, president and CEO of HealthCareCAN, which represents hospitals across the country. For instance, some residents and fellows are entering their last year of training. For others, it could take several years before they can find a training spot in a foreign city, which means they will end up finishing in Canada.
The development is good news for the Saudi medical graduates as well as the Canadian hospitals that rely on their service, Mr. Cloutier said. For decades, Canada has had a program under which the kingdom pays substantial sums to allow Saudi medical graduates to train at Canadian teaching hospitals. The doctors-in-training gain valuable experience and provide care to patients in Canada.
Ordering the trainees out of Canada would have jeopardized their future careers and forced hospitals to look for ways to fill the gaps left by their sudden departure, Mr. Cloutier said.“The hospitals that have many of these trainees will continue as is. You don’t have to scramble,” he said.
Dr. Padmos said the biggest beneficiaries are the trainees themselves, who risked having their careers derailed.“Saudi officials are showing support for their own trainees. I don’t think this implies they are retreating in any way,” Dr. Padmos said. “I also believe this move creates an opportunity for the two sides to settle their differences,” he added.
But some of the Saudi Arabian medical graduates have already left Canada. It’s unclear what will happen in those cases, Mr. Cloutier said. It’s also unclear whether Saudi residents and fellows scheduled to start programs in Canada this year will be able to, he added.
Source: Globe and Mail
Conservatives ask Bernier for proof he doesn’t have list of party members from leadership
electionThe Conservative party’s lawyers are warning Maxime Bernier not to access a party membership list he obtained during last year’s leadership vote, according to a letter obtained by the National Post.
The Quebec MP said last week he was quitting caucus and forming a new political party, little more than a year after he narrowly lost the Conservative leadership election to rival Andrew Scheer. Bernier made the announcement in Ottawa on Thursday as Tories gathered in Halifax for a policy convention.
“This letter was ultimately about safeguarding the privacy and personal information of Canadians from unauthorized access,” said a source familiar with the reasons for sending the letter. “People have submitted their contact information to the Conservative party to receive information from the Conservative party, and no one else.”
Asked whether the party was worried about Bernier attempting to use the list to identify defectors, the source said the letter was intended to safeguard against “even the possibility of this list being used for a reason other than a Conservative party leadership candidate communicating to Conservative members.”
Arthur Hamilton, a lawyer for the party, sent the letter by email and by overnight courier to Bernier’s constituency office on Monday. Hamilton asked Bernier to immediately confirm “that you have neither accessed nor utilized any lists you or your designate possessed as at the point of your announcement.”
A source familiar with Bernier’s operation said Tuesday that right after the leadership campaign, contact information provided on the official list was deleted from the database Bernier was using to track potential donors — and that a letter from Bernier’s lawyer containing proof of that would be sent to the party this week.
About 30,000 people are still in Bernier’s database, the source said, all of whom signed up for the “Mad Max Club” through his website. After choosing a name, writing the party’s constitution and getting set up with lawyers and Elections Canada, Bernier could make an announcement with further details by the third or fourth week of September.
Bernier had long ago committed to getting rid of the list at the end of the leadership race. To enter the contest in April 2016, he signed a declaration agreeing to only use membership information “for the purpose of campaigning for the leadership election and not for any other purpose.”
But he has already violated the declaration. Bernier agreed then that he would take no steps to “oppose the elected leader in any way,” and signed off on a sentence saying he wouldn’t run against the Conservatives in 2019: “I will not seek the nomination of another political party, or run as an independent candidate, and will not endorse, campaign for or publicly support any opposing candidate or political party, in the next federal election.”
Quitting caucus, calling the party “morally and intellectually corrupt” and announcing he would start his own party last Thursday clearly contravene that agreement.
It’s unclear, however, whether the party could, or would even consider, taking action to punish Bernier. Compliance deposits of $50,000 had been retained for the purposes of the leadership election, but they have since been returned to the candidates, party spokesman Cory Hann said.
Source: National Post
