Report B: FISCAL REVIEW AND OUTLOOK
MAIN EXPENDITURE ASSUMPTIONS AND RISKS
|Expenditure Area||Key Assumptions||Risks|
|K to 12 Education Programs $4,329 million||Zero enrollment growth in K to 12 for 1999/00 (compares to a 0.2% decline
Funds class size reduction in K to 3.
|Higher or lower enrollment growth. A $10 million contingency buffer is included in the ministry vote for unexpected enrollment growth or other pressures.|
|Acute and Continuing Care $4,295 million||Funds all signed collective agreements.
$15 million to hire additional nurses.
Incorporates base overspending in 1998/99.
Funds BC's share of operating costs for the new national blood agency.
Provides funding for waiting lists and for utilization increases.
|Arbitration results for collective agreement issues in the health sector
could impose additional costs.
Higher or lower utilization rates are variables beyond the control of government.
|Medical Services Plan $1,869 million||Funds medical and supplementary benefit services (e.g. chiropractic and optometry) based on expected changes to provincial demographics, consistent with the economic forecast.||An agreement between the government and the provincial medical association has not yet been reached. Some funding has been provided in the budget. Final costs could be higher or lower than assumed.|
|Post Secondary Education Programs $1,555 million||Funds 2,900 new post secondary seats.
Provides compensation to institutions for the continuation of the tuition freeze.
Provides incremental operating funds for Technical University of BC.
Funds 1999/00 wage costs.
|Student Financial Assistance $127 million (included in Post Secondary Education Programs above)||Provides for a cost of living increase of 1.1% and a utilization increase of 5.0% in 1999/00. The budget is increased 6.5%.|
|Income Assistance (IA) and Related Programs $1,308 million||The 1998/99 IA caseload reduction was 12,000 cases or 6.6%. The 1999/00 budget is slightly lower than last year and provides for a 4.5% decline in cases.||Deterioration of the provincial economy is a risk to the IA budget. However, recent strong employment growth provides a buffer.|
|Services for Children and Families $540 million||Improved use of care delivery protocols to reduce the growth of apprehensions and voluntary care agreements.||There is a correlation between the state of the provincial economy and demand for children and families services.|
|Pharmacare $542 million||Funds 1998/99 shortfall and provides for increased utilization,
population, drug costs and some new drugs.
The total budget increase is $64 million or 13.4% in 1999/00.
|Cost, volume and utilization of prescriptions are not controlled by government.|
|Direct Forest Fire Fighting $36 million||This provision is sufficient funding for a "moderate" fire year.||Wetter/dryer weather than normal, particularly in the Interior, will reduce/increase costs.|
|Ministry of Attorney General Statutory Services $50 million||Provides;
||An unusual number or severity of natural disasters such as forest fires
or floods is a risk.
Higher-than-assumed volumes or costs per case for Criminal Injuries Compensation Act and Crown Proceeding Act settlements also represent a risk.
|Debt Servicing (government direct operating debt) $940 million||Long term and short term borrowing rates average 6.1% and 5.2% respectively for the fiscal year.||For an increase/decrease of 0.5 percentage points in interest rates, debt service costs for direct operating debt will increase/decrease $25 million. When other taxpayer-supported debt is included, the effect is $50 million.|
|Contingencies and New Programs $110 million||Provision for uncertain or unforeseen issues arising over the year for
which no other budget provision currently exists.
Provision for start up of new programs under development.
|Unforeseen pressures in ministry programs may exceed available appropriations.|
|Copyright © 1999: Queens Printer, Victoria, British Columbia, Canada|