Closing the gap must be BC's top priority, CCPA says

(Vancouver) Addressing inequality in BC should be the top priority for the 2001 Budget, the CCPA will tell the BC Legislature's Select Standing Committee on Finance and Government Services at 4:45pm today. The Committee is in Vancouver to hear submissions from the public about how the government should deal with its projected surplus.

The CCPA notes that stronger growth this year (and into 2001) is good news for workers and businesses, as well as the government's fiscal situation. The brief recommends planning for a third consecutive balanced budget for the 2001/02 fiscal year.

"But even within a balanced budget framework, the 2001 Budget provides an opportunity for the government to make a number of policy choices that could capture the imagination of British Columbians, and make a qualitative difference in people's lives," said CCPA Research Economist Marc Lee.

The CCPA estimates that provincial revenues will increase by $1.3 billion next year, but flatly rejects using this "room to move" for tax cuts. Instead, the brief recommends a number of measures to address inequality in the province:

The creation of an investment fund, out of the current year's surplus, to support new initiatives in depressed urban areas;

• Raising income assistance rates by 10%, and reforming BC Benefits;

• Accelerating the construction of new social housing;

• Extending public child care;

• Reducing class sizes in the public education system;

• Implementing a first-year free tuition policy, in addition to maintaining the tuition freeze; and,

• Addressing stress points in the public health care system, including hiring more nurses, and embarking on much-needed health care reforms in areas such as community and continuing care.

On the revenue side, three areas of revenue neutral tax reform are recommended:

• Enhancing the progressivity of the tax system through the introduction of targeted low income tax credits, offset by the creation of a new tax bracket for those earning more than $150,000;

• Rolling MSP premiums into the income tax system, and,

"Greening" the tax system through study and implementation of various "tax shifting" incentives to encourage environmentally-friendly behaviour.