B.C.’s has unveiled a “coasting” budget lacking building blocks for increased productivity at a time when its large export industries are becoming less competitive, says the Business Council of B.C.
Eroding competitiveness is taking place amid an uncertain global economy. Businesses are further challenged by factors such as escalating regulatory costs and rising taxes domestically, B.C.’s carbon pricing tax system and previous increases to the corporate income tax rate.
“We must up our game on productivity,” said Greg D’Avignon, president and chief executive of the Business Council, which consists of 250 large companies, post-secondary institutions and industry organizations.
The latest budget does little to encourage private sector investment and job creation, he said.
“Strong public services require a productive and innovative economy, and on this Budget 2020 disappoints,” D’Avignon said.
It’s time to raise the “alarm bells,” as energy, mining, forestry and manufacturing industries struggle within a high-cost environment, said Jock Finlayson, Business Council executive vice-president and chief policy officer.
“We’ve got a lot of issues around competitive position, scaling up our companies, trying to make our businesses more productive and government isn’t really focused on that in this budget,” Finlayson said.
“They are continuing with their priorities which are reconciliation, climate-environment and social justice,” he said, adding those matters are all important to the province. “But what’s really been missing is the economic development piece.”
B.C. does not address developing a productive economy, Finlayson said.
“It’s not that they can do it on their own. But we are continuing to fall behind on that. Canada is too. But we are more worried about B.C. so that’s a challenge.
“We need government to be more mindful of that and try and focus on helping these companies succeed and creating an environment where more want to invest here. We don’t see that.”
Finlayson is calling on B.C. to strive to be a leader in innovation. “This includes using digital and other technologies to modernize and speed up regulatory decision-making in all areas of public policy.”
The situation is “kind of exasperating because they are three years into their term,” Finlayson said.
In the first budget, the NDP government had a “lot of pent-up demand to deal with issues after 16 years of the previous government being in power, but we still haven’t seen the elaboration of a credible economic agenda.”
Policy makers should be paying more attention to negative economic signals, such as softening in retail sales, job growth, exports and manufacturing shipments, he said.
The Business Council also raised concerns about the potential impact from the novel coronavirus, saying the risk to the provincial and federal economies is rising. “The impacts from the virus are expected to spread over the course of the first and second quarters of 2020 as exports and supply chains are disrupted and travel and tourism take a hit.”
In Greater Victoria, tourism is worth about $2 billion annually.