British Columbia’s Descent into Debt

Ben Eisen; Joel Emes

Less than a decade ago, the public finances of British Columbaâs provincial government were amongst the soundest in Canada.
Since then, much has changed. Following the election in 2017, the provincial government substantially increased spending, began to regularly run budget deficits, and oversaw a rapid expansion in public debt. British Columbiaâs debt burden is now approaching that of more highly indebted provinces.
British Columbia's Descent into Debt examines how this trend could affect British Columbiaâs standing for public debt amongst the provinces if its government continues the current path. The study examines the governmentâs current fiscal plan that runs to 2026/27 to assess the provinceâs likely debt position relative to other provinces by that date.
We also extend these projections three years to 2029/30, showing how British Columbiaâs debt position will likely compare to other provinces in five years if the province continues to accumulate debt at the same pace as projected in the current fiscal plans.
If the provinces continue on their current path, British Columbia will be amongst the most indebted in Canada in five years. We project that net debtâa measure that adjusts for financial resourcesâwould reach $36,909 per person in 2029/30, which represents 40.4% of provincial GDP.
If these developments come to pass, British Columbia would be more indebted using either metric than either Ontario or Quebec, a remarkable reversal in a short period of time.