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Blair Lekstrom, B.C. Minister of Transportation, wants to rein in BC Ferries fares, which he says are rising at an unsustainable rate. (The Canadian Press/Jonathan Hayward)

Blair Lekstrom, B.C. Minister of Transportation, wants to rein in BC Ferries fares, which he says are rising at an unsustainable rate.

(The Canadian Press/Jonathan Hayward)

Energy Minister expected to rein in hydro rates Add to ...

B.C. Energy Minister Rich Coleman is expected to announce his plans to bring BC Hydro rates under control this week as part of his government's new agenda to rein in soaring household costs.

And Blair Lekstrom, the Minister of Transportation, is taking a run at BC Ferries' fares, which he says are rising at an unsustainable rate.

The twin reviews are part of Premier Christy Clark's promise to look at the total tax burden on families.

But the one tax hike that she's shown no interest in reviewing is one of the most controversial: The carbon tax is set to jump on July 1, bringing prices at the pumps up another 1.1 cents a litre.

Finance Minister Kevin Falcon suggested a freeze on the carbon tax when he was seeking the party leadership. But that isn't on the table, said the minister in charge of Ms. Clark's so-called family-first agenda, Mary McNeil. "We haven't had that discussion."

It's a reflection of the fine line Ms. Clark is walking. The new Premier has promised a rethink of the host of taxes and fees piled on to B.C. families by public institutions.

While the Liberal government has long relied on bragging about its low personal income-tax rates, Ms. Clark has taken a broader, less flattering view. She points instead to the BC Progress Board assessment that puts the province in the middle of the pack, compared with the rest of Canada. The board looks at the consolidated tax burden of the provincial and local governments on a per-capita basis. By that measure, B.C. ranks fifth among the provinces for individual taxpayers.

Ms. Clark has raised expectations that families will be able to count on a break from a populist premier who has set her sights on an early election.

But at the same time, Ms. Clark has also committed to eliminating the deficit, and the present budget does not afford her significant manoeuvring room. So higher subsidies for BC Ferries, for example, are not an easy solution.

Ms. McNeil, the Minister for Children and Families, said putting a "families first" lens on government action doesn't mean taxpayers can count on a freeze on rates. "We do have some issues here, it is tough on families. Do we need to do as much as we were planning or can we scale it back and do it over a longer term? That's the kind of realistic discussion we have to have."

BC Hydro has proposed rate increases of roughly 50 per cent over the next five years. A rate hike that was supposed to take effect April 1 has been put on hold pending Mr. Coleman's review.

Jock Finlayson, chief economist for the Business Council of B.C., said hydro-rate increases will be tough to suppress - although he applauds any effort to try.

He said he understands why Ms. Clark would be taken aback at the proposed rate hikes. "This is a huge jump in an essential consumption item for businesses and households," he said. "She's reflecting a common-sense reaction."

But he said BC Hydro does need to invest in its crumbling infrastructure. "It would be a huge mistake to think as a result of this review the cost of power is going to stop rising." The province needs to look at some of the policies it has imposed on BC Hydro - such as conservation and self-sufficiency targets - in order to give Hydro, and its ratepayers, some breathing room.

Mr. Lekstrom, meanwhile, has 90 days to craft a plan to address ferry-fare increases that were tentatively approved by the ferries commissioner last week, with ticket prices rising by 18 per cent on the major routes over the next four years, higher still on the money-losing minor routes.

"I don't think anyone can continue to afford to continue to travel if the rate increases continue at this pace," he said. "This isn't about taking on BC Ferries. There are some cost challenges and the public is looking to government, saying, 'We want you to fix this' and I'm not going to sidestep that."

Editor's note: The B.C. carbon tax on gasoline as of July 1, 2011 will total 5.56 cents per litre - an increase of 1.11 cents. Incorrect information appeared in an earlier version of this story. This version has been corrected.





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