The B.C. government has posted a $1.8-billion deficit for the 2011/12 fiscal year, in part because of a $1.6-billion repayment to the federal government for axing the HST.
The deficit came in $915 million higher than forecast because of the HST repayment to Ottawa, but excluding that one-time repayment, the province would have posted a deficit of $241 million, according to figures released by the Finance Ministry on Wednesday.
The ministry says the provincial economy grew 2.9 per cent in 2011, according to preliminary data from Statistics Canada, making B.C. third among provinces and better than the national average rate of 2.6 per cent.
"While once again results were better than expected, B.C. remains in a period of great economic uncertainty with continued fluctuation in commodity prices and potential economic impacts from the ongoing European debt crisis," the ministry said in a statement.
"British Columbia stands out globally as a safe harbour for investment because our government continues to keep spending and debt under control. The huge debt and deficits facing European governments clearly shows the perils of the tax-borrow-and-spend mentality," Minister of Finance Kevin Falcon said in a written release.
"Through prudent fiscal management, British Columbia is on track to eliminate the deficit and return to a balanced budget by 2013/14."