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February 19, 2008

As required by Section 7(d) of the Budget Transparency and Accountability Act (BTAA), I am confirming that the Budget and Fiscal Plan contains the following elements:

  • The fiscal and economic forecasts for 2008/09 and future years, which are detailed in Part 2 and Part 4.
  • All material economic, demographic, taxation, accounting policy and other assumptions underlying the 2008/09 economic, revenue, expenditure, surplus and debt forecasts are also disclosed. In particular:
    • The status quo policy is assumed for federal government transfer revenues. No revenues or expenditures have been included in this budget either for the recently legislated federal Community Development Trust, or for the transfer of labour market programs from the federal government which was still being finalized when the budget went to press. These will be included in future fiscal updates as detailed agreements are complete and accounting treatments confirmed. While both initiatives will result in increased revenue and expenditure, the net impact on the three-year fiscal plan is expected to be small;
    • Similarly, no assumptions have been made regarding measures that may be included in the federal budget expected to be tabled on February 26, 2008; and
    • Many of the wage agreements reached in the last round of public sector negotiations expire by the end of the 2009/10. In 2010/11, Ministry of Health funding growth is maintained at the same rate as for the previous year to accommodate wage increases in that sector; an increased contingency vote allocation has been provided for other sectors.
  • The report on the advice received from the Minister’s Economic Forecast Council on the economic growth outlook for British Columbia, including the range of forecasts for 2008 and 2009.
  • The major areas of risk to the plan known at this time are disclosed in the risks section in Part 2, and in the material assumptions tables in the Appendix.

Government continues to work towards providing funding information to health authorities and post-secondary institutions sufficiently early in the fiscal year for them to develop board approved plans for the budget; however, this was not possible for Budget 2008. As a result, the financial forecasts for school districts, universities, colleges and health authorities (the SUCH sector) have all been developed by the Ministries of Health, Advanced Education and Education on an aggregate basis for their respective sectors. Individual organizational plans for health authorities and post-secondary institutions will be developed over the coming months and reflected in the updated fiscal plan in the first Quarterly Report.

The accounting policies followed in the Budget and Fiscal Plan comply, in all material respects, with generally accepted accounting principles (GAAP) for senior governments.

As required under section 7(e) of the BTAA, the forecast allowance, which is an adjustment to the most likely forecast of the 2008/09 surplus, is also disclosed. The 2008/09 to 2010/11 forecast allowances help to mitigate against revenue risks arising from a worse-than-expected economic slowdown in the US and in particular its housing sector, unexpected costs such as natural disasters, changes in key commodity prices or out-year funding pressures.

I would like to recognize staff in government ministries and agencies for their contribution to this document. I would like to especially acknowledge staff in the Ministry of Finance, whose professionalism, commitment and expertise were essential to the completion of this budget.

Chris Trumpy
Deputy Minister and
Secretary to Treasury Board

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