This year's budget brings relief to a small number of families with the least and the most, but likely won't help the majority of parents trying to keep pace with the increasing cost of living in British Columbia, critics say.
The budget made good on the Liberals' commitment to ending a two-year tax hike for those making more than $150,000 and shut down a controversial clawback from single mothers on income assistance, but did little to help middle-class and working families fight rising fees for power, higher education and health care.
After sharp and emotional criticism from advocacy groups such as ACORN B.C. over the past year, some of the province's poorest parents – single mothers on welfare – will now be able to keep the child-support payments from their former partners starting Sept. 1.
Each month a single parent with one child is eligible for $945 in income assistance or $1,242 in disability payments. Under the old policy, those cheques are reduced by the amount of any child support received by a former partner.
Surrey mother Chrystal Tabobandung, 36, says abolition of the policy "would make life so much easier."
The rent at her social housing unit is tied to her income and that meant whenever she received sporadic child support, her rent went up by several hundred dollars – even though those payments were clawed back by the government, leaving her with a welfare cheque of just $45 a month.
If she receives both social assistance and child support, Ms. Tabobandung says she will be able to buy some new clothes for her child and maybe pay for some extracurricular activities.
"I can't put him in a basketball club with all his other friends he goes to school with every summer – I can't do that for him," Ms. Tabobandung said. "I should be able to take his child-support payments and say 'yes, you have that opportunity.'"
The policy change will return about $13-million over the next year to about 5,400 children in 3,200 families, Finance Ministry officials said.
The budget also lets people earn several hundred dollars more before they pay tax on any income more than roughly $19,000.
Irene Lanzinger, president of the B.C. Federation of Labour, praised the elimination of the clawback, but said the budget doesn't help the more than 120,000 people earning minimum wage in the province.
"We have lots of families working at low wages and really struggling, there's no raise to the minimum wage, no child-care plan and no poverty reduction plan," Ms. Lanzinger said.
Finance Minister Mike de Jong said the government is sticking to its principles in eliminating the tax hike for top earners on Jan. 1, which will save those taxpayers "with a little more to give" about $200 each and cost the province about $51-million this fiscal year.
"We take pride in the fact that for people earning $122,000 and less, they pay the lowest provincial income tax anywhere in Canada," Mr. de Jong said.
Jock Finlayson, an economist and executive vice-president of the Business Council of B.C., said the government phasing out the 2-per cent tax hike won't have a major impact on the economy, but could help lure more entrepreneurs and professionals to the province. He added that as a matter of "political philosophy," B.C. and Alberta tax their richest earners considerably less than the other provinces, noting "it's up to the voters to decide what they want."
He said B.C.'s overall income tax rates are "fairly low" and families are more likely to worry about job opportunities than how much they pay the government in taxes.
NDP finance critic Carole James said under the new budget middle-class families will be hit by rising medical premiums (4 per cent), BC Hydro rates (6 per cent), and ICBC premiums (between 3.7 and 6.7 per cent).
Mr. De Jong bristled at the suggestion that middle-class families were poorly served by the budget, noting that families benefit most when the government keeps income taxes low and balances its books.
The Liberals have also budgeted $3-million to help parents claim an extra $250 on top of an existing provincial arts and sports credit to go toward equipment such as soccer cleats and hockey pads.
Mr. de Jong said that compared with when the Liberals first came to office in 2001, a family of four earning $70,000 now pays $2,027 a year less in provincial income taxes.
Editor's note: A previous version of this article incorrectly identified Jock Finlayson as president of the Business Council of B.C. In fact, he is the executive vice-president.