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Province's economic view: surplus down, spending up

Five-day session to include tax relief measures

The provincial government plans to increase spending on a broad range of programs, despite a dramatic decline in the expected surplus, Finance Minister Colin Hansen said yesterday.

"I'm very confident that in February, when I bring the budget down, you will still see more dollars spent on healthcare, education and social services in the next year, and the year after, than we're seeing this year," Hansen said in an interview.

B.C. will still post a surplus this year, but it won't be anywhere close to the $1.8 billion projected just months ago, Hansen said.

The economic crisis sweeping the planet has eroded provincial revenues by hundreds of millions and led to a significant decline in the surplus forecast in September, he said.

Hansen declined to provide a more precise figure but said he hopes to release a financial update Monday during a brief fall sitting of the legislature.

That session gets underway in Victoria this morning with the government expected to table legislation in support of Premier Gordon Campbell's plan for weathering the global crisis.

Government house leader Mike de Jong said the bills will provide income tax relief for individuals and businesses while ensuring unlimited deposit insurance for credit unions.

"We're pleased to be back and bring a specific package of legislation that will provide families with some much needed assistance and relief," de Jong said.

Hansen suggested that the measures proposed so far may not be the last of the government's attempts to stimulate the economy during this fiscal period. "As we can confirm [the] additional revenues to the province, we will be finding ways that we can re-inject those dollars back into the economy for the benefit of all British Columbians," he said.

"This is not the year for us to run up big surpluses."

The session is slated to run five days, but neither the government nor Opposition would commit to that time frame.

De Jong said the timing hinges on whether NDP Leader Carole James follows through on early indications that she supported the premier's package.

"I'm hesitant about predicting what her and the Opposition's response to the legislation will be," he said. "It wouldn't be the first time she said one thing and did something very different."

James said she'll wait to see what the bills say before promising her party's support.

"It's hard to know what direction we'll be able to go, whether we'll be able to introduce amendments, what we're looking at for these five days," she said. "As we all know, the government should have called us back weeks ago, and now they're calling us back for five days. We'll use the opportunity to really make sure that we're holding the government's feet to the fire."

The NDP comes into the session riding high after two by-election victories on the Lower Mainland, major wins by left-leaning politicians in last week's municipal elections, and polls showing the Opposition either leading or within striking distance of the governing Liberals.

The upbeat NDP caucus gave its two newest MLAs -- Jenn McGinn (Vancouver-Fairview) and Spencer Herbert (Vancouver-Burrard) -- a standing ovation at a meeting yesterday.

"We're coming into this session feeling very strong and very good and are going to keep the hard work up that has taken us here," James said.

De Jong, however, said he learned long ago not to put too much stock in public opinion polls. "In a time of economic uncertainty, people know who they'd rather have tending the store, and that's Premier Campbell and the B.C. Liberal government that helped get B.C. to where we are today."