Message from the Minister and
The first year of the Government's renewed mandate saw the Ministry of Finance continue its record of sound fiscal management, balanced budgets, and strengthening British Columbia's economy.
A strong economy and responsible fiscal management provide British Columbians the opportunity to act on our shared priorities. This is evident in new budget funding for seniors and children; new investments in schools, hospitals and roads; and new reductions to keep taxes fair and competitive.
British Columbia's fiscal plan supports the Five Great Goals with additional funding to generate better education outcomes, nurture a healthier population, support people in need, and ensure we continue to enjoy a clean, sustainable environment. It also backs a new and flexible approach to negotiating public sector contracts, an approach that has seen unprecedented success.
British Columbia continues to lead in timely and transparent financial reporting that meets the rigorous standards of Generally Accepted Accounting Principles. This is the second consecutive year that the Public Accounts received an unqualified review from the Auditor General.
The Province's strong fiscal management and transparency are among the reasons Standard and Poor's improved British Columbia's credit rating for the second time in 18 months, raising it to AA+ from AA. The upgrade cited the robust performance of British Columbia's economy, larger-than-expected budget surpluses, and the Province's low and declining debt to gross domestic product (GDP) ratio.
The Province continues to ensure debt remains affordable while investing in key infrastructure projects to support our growing economy and population. British Columbia invested $3 billion in schools, post-secondary and health care facilities, and transportation infrastructure and other capital projects in 2005/06. At the same time, B.C.'s taxpayer supported debt to GDP ratio declined from 18.2 per cent to 16.2 per cent.
A fair and competitive tax regime also contributes to the Province's robust economy. Over the past year, the budget supported tax reductions targeted to low and modest income earners and enhanced Medical Services Plan premium assistance. It also introduced measures to enhance economic competitiveness and support job creation, including a reduced corporate income tax rate.
The new $6 billion negotiating framework contributed to the successful negotiation of all contracts that were set to expire on or before March 31st. At March 31st, more than 55 agreements are in place covering more than 230,000 union and non-union public sector employees. The success of this initiative rests with the dedicated negotiators from both sides of the table. They were creative and flexible in reaching agreements that meet the needs of employers and employees, and will serve to improve public programs and services.
Effective, accurate and timely public communication is essential to keep British Columbians informed about government priorities and programs. The Province fosters dialogue on public priorities, and ensures British Columbia's powerful story is told here, across the country and around the world.
On behalf of British Columbians, I thank all ministry staff for their dedication and hard work of the past year. They produced two budgets, helped meet or exceed ministry and government goals, and contributed to the overall success of B.C.'s high-quality public services.
The 2005/06 Ministry of Finance Annual Service Plan Report compares the actual results to the expected results identified in the ministry's 2005/06 – 2007/08 Service Plan Update. I am accountable for those results as reported.
Honourable Carole Taylor
Minister of Finance
June 30, 2006