BC SOLUTIONS BUDGET 2006 - Budgeting for Women's Equality - FEBRUARY 2006

 
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BC SOLUTIONS BUDGET 2006
Budgeting for Women’s Equality

             FEBRUARY 2006
BC SOLUTIONS BUDGET 2006: Budgeting for Women’s Equality

February 2006

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compassionate, yet realistic, approach to fiscal policy is possible. They demonstrate that good public policy
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Contents
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

Introduction: Gendered Budgets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Women and BC’s Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
        It’s About Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
        Men and Women in the Labour Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
        Trends in the “Official” Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

Women and the BC Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
        Public Sector Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
        Education and Training . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
        Care Work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
        Deregulation of Employment Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
        Social Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
        Legal Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

BC Budget and Fiscal Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

Priorities for Budget 2006 and Beyond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
        Advocacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
        Early Learning and Child Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
        Anti-Poverty Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
        Affordable Housing Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
        Enhancing BC’s Education System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
        Health Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
        Women’s Support Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
        Responding to the Pine Beetle Crisis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34

Solutions Budget Three-year Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39

Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40
Summary

BC Finance Minister Carole Taylor is in the fortunate position of deciding
how to allocate billions of dollars in available surpluses over the coming years.
Indeed, available surpluses are substantially larger than the government has
officially acknowledged. This is good news, because despite a strong economy
and low unemployment, not all British Columbians are benefiting from good
times and the province has many pressing and unmet needs. Many of those
left behind are women, in particular women with children.
    In this year’s BC Solutions Budget we set out a budget for women’s equality, rejecting tax cuts and debt
reduction in favour of enhancing public services in a manner that improves women’s ability to enjoy a
healthy standard of living, to make real choices about their personal and family lives, and to participate
fully in society.

Women and the Economy
When we look at the total work (paid and unpaid) of a society, women perform, on average, slightly
more work than men. But almost two-thirds of the work done by women is not counted at all in conven-
tional economic statistics. Unpaid work, including caring for children and elders, preparation of meals,
and cleaning – all of which is vital to our economy and society – is invisible and uncounted, its contri-
bution to our well-being taken for granted in discussions of public policy.
    This fundamental inequity spills over into the paid labour market, where women still come away
with less, even after adjusting for hours worked, education and experience. Women are less likely to be

4      Canadian Centre for Policy Alternatives – BC Office
in “good jobs,” are more likely to be in part-time, temporary or other precarious employment, and tend
to have lower wages than men even when they are working on a full-time, full-year basis. Women are
more likely to be poor and represent the majority of people on social assistance.
   An important reason for this is that the caring work done by women poses challenges to their ability
to participate in the labour market on equal terms. Families with sufficiently high incomes can purchase
some or all of these household services (cleaners, cooks, dining out, live-in caregivers, etc.). But, of course,
many families cannot do this, and the need for unpaid work does not go away.
   Public sector choices can also have effects at the household level. When tax cuts precipitate spending
cuts, it is often the case that high-income families receive a windfall that more than enables them to
pay privately to replace lost services. But low-income families will lose more in services than they receive
in tax cuts, while still needing to deal with additional care work.

Women and the BC Budget
The broad-based cuts to the provincial budget between 2002 and 2004 are a clear demonstration of the
relationship between budgets and equality for women. For example:
         •   Job losses in the public sector were a double blow to women – who make up the majority
             of public sector workers and who also rely disproportionately on those public services.
         •   Cuts to income assistance benefits and eligibility affect women disproportionately, in
             particular single mothers.
         •   Provincial policies have made it harder for women to get higher education, a well-known
             path to equality in the labour market.
         •   Cuts to women’s centres and legal aid undermined important supports needed by women
             to leave abusive relationships and retain custody of their children.
   In the face of large surpluses, the provincial government needs to restore funding in these areas, and
focus on creating an overall anti-poverty strategy, increasing access to high quality child care, and ensuring
that all British Columbians have equitable access to services.
   One area that merits increased attention is the need for advocacy at various levels. Everyone needs
an advocate at some point, such as when confronting our complex legal system. We believe that the
concept of advocacy should be expanded and extended to people on social assistance, seniors, people
navigating the health system, people with disabilities and mental health challenges, recent immigrants,
and to workers (particularly immigrant and precarious workers).
   Special mention must be made of the unique advocacy role played by women’s centres throughout
the province. These centres often serve as a hub for many advocacy functions, particularly in smaller
communities where the local women’s centre may be the first and only place a woman can go when
needing help to flee abuse, navigate the legal system, maintain custody of a child, fight for social assistance,
or confront an unfair employer. These centres urgently require restored and increased public support.
   We also recommend new and restored public bodies with a mandate to defend human rights and
advocate for equality. We call for the creation of a Women’s Advocate, to be engaged in the collection
of data, tracking what is happening in specific communities, setting benchmarks, and issuing reports
that hold the government accountable. Women’s interests would also be served by the re-establishment
of the BC Human Rights Commission, as well as by a full Ministry of Women’s Equality to speak to these
issues at the Cabinet table and throughout the provincial bureaucracy.

                                                       BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   5
Solutions Budget Framework
For several years running, the BC government has greatly underestimated its available revenues at budget
time, resulting in much lower than expected deficits or higher than expected surpluses at year-end. In
fact, the past four BC budgets have understated the province’s budget position by a combined $7.9 billion.
Low-balling budget estimates not only precludes public debate – leading to a de facto policy of debt reduction
– it also erodes public confidence in the reliability of government forecasts, as has been the case federally.
    Based on Ministry of Finance forecasts of economic growth over the next two years, we estimate
surpluses of $2.8 billion in 2006/07 and $3.9 billion in 2007/08. We call on the government to reject
calls for further tax cuts or debt reduction as the best use of coming surpluses.
    Our framework of social reinvestment is designed to meet BC’s pressing needs and to avert continued
reduction of the public sector. By simply using available surpluses over the coming years, the provincial
government could take meaningful steps to make BC a more just and equitable place to live. Spending
all available revenues would enable BC to:
           •     Implement an early learning and child care program for children aged two to five, and a
                 before-and-after-school care program up to age 12. This amounts to $1.5 billion in new
                 operating funding by 2008/09, and includes pay increases for early childhood educators.
                 We also allocate $600 million over three years for capital costs to build 135,000 spaces (half
                 full-time and half part-time).
           •     Provide an additional $500 million per year increase to K–12 and post-secondary education
                 in BC (an increase of $1.5 billion above 2005/06 levels by 2008/09).
           •     Fight poverty by immediately raising income assistance benefits. Total benefits for the poor
                 would rise by a total of 50% by 2008/09. This measure would cost about $500 million above
                 current levels.

    Underestimates of BC Budget Position

                                                                                                                    Projected surplus
                                                                                                                    (deficit) at
                                                                                                                    Budget time

                                                                                                                    Final surplus
                                                                                                                    (deficit)

    Note: Final figures are before accounting adjustments. 2005/06 is not final but is most recent Ministry estimate based on
    Second Quarterly Update.
    Sources: Ministry of Finance budget documents, various years.

6        Canadian Centre for Policy Alternatives – BC Office
•    Address the crisis at the Ministry for Children and Families by increasing the budget 30%
              by 2008/09. Increased funding for MCFD must include more money for family supports,
              so that poor and Aboriginal women can see a reduction of the apprehension of their children.
         •    Reinstate a Child, Youth and Family Advocate and create a new Women’s Advocate as
              independent, arms-length public bodies. In addition, we re-establish the BC Human Rights
              Commission and a full Ministry of Women’s Equality.
         •    Increase funding for women’s centres and other support programs, including legal aid, through
              a 15% increase in funds for protection of persons and property in 2006/07.
         •    Fund progressive health care reforms, including wait list reduction strategies and
              community care services. We increase the health care budget by 15% over three years, plus
              an additional $200 million per year in capital spending for new long-term care facilities.
         •    Create 2,000 new units of social housing per year.
         •    Provide $120 million in new annual funding to fight the pine beetle epidemic.
   These expenditures are ultimately conservative in that they accept the tax cuts and downsizing of
government since 2001. By returning revenues (relative to GDP) to levels in 2000/01 or 2001/02, much
more could be achieved, such as a much more substantial reduction in K–12 class sizes, further expansion
of early learning and child care, elimination of post-secondary tuition fees, and an acceleration of public
transit projects.
   This Solutions Budget illustrates what we can do if we work together. It is possible to address pressing
problems in our society and economy. The size of forecast revenues tells us that funds are available to
do so; the real challenge is the political will. These types of changes will enhance opportunities available
to women, and will boost participation in the community, while creating a stronger foundation for our
children and taking better care of our elders. Moving in this direction, we all benefit – men, women,
children, communities, society and the economy.

                                                     BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   7
Introduction:
Gendered Budgets
Each year, the CCPA does something a little different with the BC Solutions
Budget (our annual alternative provincial budget). This year, the BC
Solutions Budget takes its inspiration from “gendered budget” initiatives
that have emerged over the past decade. Many countries, North and South,
have taken to looking at their budgets through the lens of gender,
recognizing that budgets have different effects on women and men. These
initiatives have been done by NGOs and governments, and have been
promoted by United Nations bodies.
    The spirit of gendered budgets reflects the CCPA’s own experience, starting with the first Alternative
Federal Budget in 1995, and with our Solutions Budgets at the provincial level. In a background paper for
the 1998 AFB, Isabella Bakker and Diane Elson outlined the concept of gendered budgets with a brief
look at the Canadian context. They began by noting that:
      The budget, on the face of it, appears to be a gender-neutral policy instrument. It is set out in terms
      of financial aggregates – totals and subtotals of expenditure and revenue, and the resulting budget
      surplus or deficit. As usually presented, there is no particular mention of women, but no particular
      mention of men, either.
      However, this appearance of gender-neutrality is more accurately described as gender-blindness. The
      way in which the federal government’s budget is usually formulated ignores the different, socially
      determined roles, responsibilities and capabilities of men and women. These differences are generally

8      Canadian Centre for Policy Alternatives – BC Office
structured in such a way as to leave women in an unequal position in relation to the men in their
      community, with less economic, social and political power, but greater responsibilities for caring for
      those who need the care of others.
   While Bakker and Elson’s paper signalled a new era of gendered budgets, the development of an actual
alternative budget through a gendered lens in the Canadian context has been elusive. Until now.
   It would, of course, be impossible to right every wrong in one provincial budget. Our objective with
this Solutions Budget is to outline steps, over the next three years, the provincial government can take
toward a more just and equitable British Columbia. Budgets are about the choices we make together as
a society. We believe that budgets should play a role in expanding opportunities for women and girls,
and that in doing so we all benefit – men, families, communities, society and the economy.
   There are many reasons women would want to have a more supportive budget as a counterweight
to centuries of historical inertia with regard to an economy, and resulting budgets, designed principally
with men in mind. Budgets have a role to play in levelling the playing field for women, politically, econom-
ically and socially. Budgets should also be sensitive to the differences among women due to age, citizenship,
class, ethnicity and other aspects that traditionally disadvantage people.
   When we look at the total work (paid and unpaid) of a society, women perform, on average, about
the same amount of work as men.1 But almost two-thirds of the work done by women is not counted
at all in conventional economic statistics. Unpaid work, including caring for children and elders,
preparation of meals, and cleaning – all of which is vital to our economy and society – is invisible and
uncounted, its contribution to our well-being taken for granted in discussions of public policy. This
fundamental inequity spills over into the paid labour market, where women still come away with less,
even after adjusting for hours worked, education and experience.
   While some things have changed for the better over the past decades in terms of attitudes and oppor-
tunities for women, full equality is not yet within grasp. In federal Parliament and provincial legisla-
tures, where budgets are tabled and approved, the relative absence of women is notable: federally, only
64 of 308 seats in the recent 2006 election were won by women (21%); in BC, 18 of 79 seats are held
by women (23%). No wonder that issues such as violence against women have all but disappeared off
the legislative agenda. Or that child care seems to be a top priority only at election time.
   This year, we ask how social and economic policy can better meet the needs of women in BC, in
particular women with children. While conservatives still think of women as homemakers in families
with one male breadwinner, the reality for women in the 21st century is much different. The prevalence
of the single earner family is shrinking, accounting for under 10% of families in BC in 2002. In two-
parent families with children, only one in six mothers (18%) did not have paid work (nationally, based
on the 2001 Census). This is in part a reflection of the cost of living and what is needed to get by. Women’s
contributions to household incomes are also a source of stability through times that have a greater degree
of risk and uncertainty. In addition, they reflect women’s desire to participate actively and equally in
all areas of society. Thus, social and economic policy must recognize this reality and provide supports
that facilitate women’s participation in the labour market, that free up time, and give real choices and
opportunities.
   The challenge is more acute for single-parent families, about 16% of families with children. Of these
families, the vast majority – more than four in five – are led by women. This group has the highest rates
of poverty for any demographic group, so they are an obvious focal point for action. Education and full-
time work greatly reduce low-income rates among lone mothers. But full-time work is not a panacea,
especially for the youngest and least educated, as employment earnings are offset by the costs of trans-
portation and other work-related costs, as well as the loss of certain government benefits, and poor women
have great difficulty finding and affording reliable and safe child care.

                                                        BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   9
As the CCPA has noted in a number of recent studies (see sidebar on Resources), the provincial
government’s spending cuts over the last four years have disproportionately harmed women (who make
up the majority of public sector workers and who are more reliant on public services). The tax cuts, on
the other hand, have disproportionately benefited men (who tend to have higher incomes and thus
benefited more from upper-income tax cuts). Thus, this Solutions Budget focuses on undoing the damage
from spending cuts and instead enhancing public services in a manner that improves women’s ability
to enjoy a healthy standard of living, to make choices about their personal and family lives, and to
participate fully in society.
     We revisit these issues in the next sections, looking at how provincial policies have affected women’s
equality and economic security, and suggesting ways in which we can move forward – together.
     Social policy for the 21st century needs to take seriously the real lives of women and the challenges
they face. It must consider the different experiences of women and men in the labour market and in
the household. It must stare poverty in the face, and design strategies to eliminate the disproportionate
poverty of particular groups of women, such as single mothers and Aboriginal women. We also need to
think about how social policy interacts with women and men over the course of a lifecycle and how
good policies can enhance the opportunities and choices available to all of us.

  Resources for Further Reading
  This Solutions Budget draws on a number of research reports from the CCPA over the past few years.
  Some of the key reports, from a gender equity perspective include:
        Women’s Employment in BC: Effects of Government Downsizing and Employment Policy Changes
           2001–2004, by Sylvia Fuller and Lindsay Stephens.
        Legal Aid Denied: Women and the Cuts to Legal Services in BC, by Alison Brewin and Lindsay
            Stephens.
        The Pains of Privatization: How Contracting Out Hurts Health Support Workers, Their Families, and
            Health Care, by Jane Stinson, Nancy Pollak and Marcy Cohen.
        A Return to Wage Discrimination: Pay Equity Losses Through the Privatization of Health Care, by
            Marjorie Griffin Cohen and Marcy Cohen.
        The Case for Pay Equity: Submission to the BC Task Force on Pay Equity, by Sylvia Fuller.
        The Road to Equity: Training Women and First Nations on the Vancouver Island Highway – A Model for
            Large-Scale Construction Projects, by Marjorie Griffin Cohen and Kate Braid.
        Gender Budget Initiatives: Why They Matter for Canada, by Isabella Bakker, Technical Paper #1,
            Alternative Federal Budget 2006.
        Making Early Childhood Development a Priority: Lessons from Vancouver, by Clyde Hertzman.
        A Bad Time to be Poor: An Analysis of BC’s New Welfare Policies, by Seth Klein and Andrea Long.
  These documents can be downloaded free from the CCPA website at www.policyalternatives.ca.
  We also rely on research work done by women’s NGOs including:
        British Columbia Moves Backwards on Women’s Equality, submission of the BC CEDAW (Convention
              on the Elimination of All Forms of Discrimination Against Women) Group to the UN
              Committee on the Elimination of Discrimination Against Women on the occasion of the
              Committee’s Review of Canada’s 5th Report, January 2003.
        Canada’s Commitment to Equality: A Gender Analysis of the Last Ten Federal Budgets (1995–2004), by
            Armine Yalnizyan for the Canadian Feminist Alliance for International Action (FAFIA).

10      Canadian Centre for Policy Alternatives – BC Office
Women and BC’s Economy

Before we consider how budgets can better meet the needs of women
and their families, we must take a step back and look at the economy
in a broader context. Typically, the economy is framed in terms of
employment in the labour market and economic output in terms of Gross
Domestic Product (GDP). The GDP accounts sum up the incomes and
expenditures from activities in the private and public sectors.
   Feminist economists have pressed for an expansion of what we consider to be the economy, to include
unpaid household and community care activities. This third domain is interdependent with economic
activities in the public and private sectors. To get to a gendered budget we need to carefully think about
how these sectors interact with each other. When we are told that we need to make sacrifices in the
name of the economy, it is helpful to have a firmer grasp on what we really mean by “economy.”
   In this section, we outline the household economy by looking at time and work. We then look to
how this spills over onto the paid labour market. Finally, we look at some broader economic factors that
shape our budgetary framework.

It’s About Time
For several years, researchers at Statistics Canada have measured what Canadians do with their time.2
There are three broad categories for our time, averaged across the whole population aged 15 and over.
First, we spend over ten hours a day sleeping, eating and doing other personal activities. Second, we
spend a bit less than eight hours a day working, including all paid and unpaid work. And third, what
is left over, just under six hours a day, is left for leisure and everything else.

                                                     BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   11
Time-use statistics provide an interesting perspective on the relationship between paid and unpaid
         labour. On average, Canadians spend slightly more time engaged in a variety of unpaid work (24.1 hours
         per week) than they do in paid employment (21.7 hours per week). Unpaid work accounts for 28% of
         people’s waking hours. Of the total unpaid work, the vast majority (94%) is in the household, with the
         remainder in volunteer and civic activity outside the household.
              The catch is that work done in the home (and any volunteer work as well) is not counted in conven-
         tional economic statistics, the GDP accounts.3 But the value of unpaid work is tremendous: equivalent
         to between one-third and one-half of GDP, depending on the estimation technique used. The lower estimate
         of one-third of GDP is conservative in that it is estimated based on what it would cost to purchase those
         services at a typical housekeeper’s wage rate.
              In terms of total productive time commitments (paid and unpaid), men and women are putting in
         about the same number of hours. Women actually work about one hour per week more than men (46.4
                                                      hours versus 45.2 hours), but only 37% of women’s productive time
                                                      is paid work, and is thus captured in conventional economic statistics.
Women actually work about one                         The opposite situation applies for men; almost two-thirds of their time
hour per week more than men,                          is in the market and one-third is unpaid.
                                                          Viewed over a period of decades, the share of unpaid work done
but only 37% of women’s
                                                      by women has changed very little going back to 1961. But over the
productive time is paid work, and                     same period, the labour force participation of women has doubled.
is thus captured in conventional                      Put these together and the result is major time stress for both sexes
                                                      and all age groups, with working mothers being the most time-stressed
economic statistics. The opposite                     demographic group of all. One consequence of increased pressures on
situation applies for men; almost                     time is a decline in voluntary work, according to work done by GPI
                                                      Atlantic (an East Coast group developing a Genuine Progress
two-thirds of their time is in the
                                                      Indicator), who also point out that when paid and unpaid labour are
market and one-third is unpaid.                       considered together, we are working longer hours on average than we
                                                      did in 1900.
              Families with sufficiently high incomes can purchase some or all of these household services (cleaners,
         cooks, dining out, live-in caregivers, etc.), in which case they are counted in the GDP accounts.4 These
         families can convert their time spent in unpaid work into time for paid work or leisure. But, of course,
         many families cannot do this, and the need for unpaid work does not go away.
              When public services are cut, there is often an unacknowledged effect at the household level, as caring
         work still needs to be done by someone. These hidden time costs affect individuals and society in ways
         not widely recognized – in stress, fatigue, and in the time taken away from other possibilities, including
         education and civic/community involvement. Alternatively, caring work for children or seniors does not
         get done relative to the time and attention required. When tax cuts precipitate spending cuts, it is often
         the case that high-income families receive a windfall that more than enables them to pay privately to
         replace lost services. But low-income families will lose more in services than they received in tax cuts,
         while still needing to deal with additional care work.
              Women’s relatively lower access to the paid labour market also affects equality in the household, and
         the choices women can make. This is particularly important when women are in violent or abusive rela-
         tionships. Women without an income (and without the experience and education required to get a good
         job) are more likely to be stuck in bad situations. For women, leaving a male spouse or partner is a
         financially risky proposition, especially if a woman has young children. The death of a spouse or divorce
         can also be a direct link to poverty. Studies of income mobility (or changes in incomes over time) find
         that women’s likelihood of falling into poverty is much greater following certain life events, such as the
         birth of a child, the death of a spouse, or divorce.

         12      Canadian Centre for Policy Alternatives – BC Office
Men and Women in the Labour Market
The issue of unpaid work has profound implications for paid work in the labour market. Women have
experienced steadily increasing labour force participation rates over the past fifty years, and have increased
their average education levels and unionization rates as well. The two-income household is now much
more commonplace, and many women actively pursue “careers” instead of passively taking “jobs” to
provide a secondary income to the household.
   The caring work done by women poses challenges to their ability to participate in the labour market
on equal terms. Women in their childbearing years may be less likely to get a job due to perceptions
that they will have children and be away from the job for long periods of time – even if they never plan
to have children they are subject to “statistical discrimination.” Women who are not available to work
unscheduled or overtime hours because of child care responsibilities are often seen to be not sufficiently
ambitious.
   As noted above, women carry the bulk of the load in terms of raising children and caring for elders,
which means they will be in the paid labour force less than men over the course of a working life. This
can negatively affect women’s ability to have a career path, and they may be passed up for jobs and
promotion opportunities. Moreover, a woman who stays at home to raise children faces a greater likelihood
of poverty in old age, as she will have accumulated less in Canada Pension Plan premiums, an important
pillar of income security for seniors. And there is no guarantee that family pension income (or any type
of income, for that matter) will be shared equally in the household.
   Thus, despite the gains made by women over the past half-century, there are still major inequities
in how the labour market treats women. Women are less likely to be in “good jobs,” are more likely to
be in part-time, temporary or other precarious employment, and tend to have lower wages than men
even when they are working on a full-time, full-year basis. As Sylvia Fuller and Lindsay Stevens noted
in a 2004 CCPA report on women’s employment in BC:
      No matter how you define earnings (e.g. annual income vs. hourly wages, mean vs. median), a gap
      between women and men’s wages persists, even among men and women in the same occupations,
      and with the same educational credentials. In Canada, the average woman earns only 81.6% of
      what the average man earns. Lower paid jobs and gendered barriers to full labour market participa-
      tion (such as women’s disproportionate responsibility for unpaid domestic labour) limit many women’s
      ability to earn enough to raise them above the poverty line, and women are more likely than men to
      be poor. Overall, 19% of women in Canada earn wages below the Low Income Cut Off (LICO) compared
      with 16% of men, and women are also more likely than men to be persistently below the LICO.
   This relationship between society’s important caring work and the paid labour market has many impli-
cations for women’s economic security, present and future. The situation is relatively worse for women
who are women of colour, Aboriginal, recent immigrants, or disabled, in terms of higher unemployment,
greater incidence of poverty, lower wages and poorer quality jobs.

                                                     BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   13
Trends in the “Official” Economy
         Before moving on to a review of how the BC budget affects women, it is worth pausing to review what
         is happening in BC’s “official” economy at the start of 2006.
               On the surface, the economy is booming, with the best job market in a generation. But if we peer
         beneath the surface, there are some troubling findings: real wage growth has stagnated; the share of total
         income going to labour (in the form of wages, salaries and commissions) has declined substantially; and
         productivity, the holy grail of economic policy, has failed to grow at all.
               What does this mean? BC is experiencing a strong cyclical upturn in the business cycle, driven mainly
         by low interest rates, strong international demand and high commodity prices. In forestry and energy,
         global forces are providing a good tailwind to the BC economy. And, like other parts of North America,
         real estate and residential construction are red hot.
                                                           But thus far, there has not been a structural improvement in BC’s
                                                       economic fortunes. Tax cuts and deregulation, both federal and
On the surface, the economy is                         provincial, have not worked their promised magic to boost investment
booming, with the best job                             and productivity.
                                                           The good news is a job performance not seen in decades. The unem-
market in a generation. But if we                      ployment rate averaged 5.9% in 2005, and 5.0% for the last quarter
peer beneath the surface, there                        of 2005. Total employment as a share of the population (a better
                                                       indicator) has grown from 59.0% during the 2001 downturn to 61.7%
are some troubling findings: real
                                                       in 2005. About half of the total increase in employment in 2004 and
wage growth has stagnated; the                         2005 can be attributed to the residential construction sector.
share of total income going to                             Economically, a tight labour market should be synonymous with
                                                       growing wages, due to greater competition among employers for a
labour has declined substantially;
                                                       dwindling supply of workers. But average weekly wages in real terms
and productivity has failed to                         declined 1.6% in 2004, after slight gains in 2002 and 2003. The outlook
grow at all.                                           for 2005 is not much better, with nominal wage gains essentially offset
                                                       by inflation.
                                                           More disturbing is the change in shares of total income going to
         labour (wages, salaries and commissions) and capital (profits). In just a few years, we have seen a spectacular
         shift of income from workers to owners. In 2004, total labour income amounted to exactly half (50.0%)
         of provincial GDP, down from 53.2% in 2000 (this latter figure is slightly below the historical average
         going back to 1961, the first year covered by the BC economic accounts). In fact, labour’s share in 2004
         was the lowest since the early 1960s.
               This decline is almost exactly offset by near-record profits. Pre-tax profits in BC jumped a whopping
         39% in 2004, building on a 13% gain the year before. As a percentage of GDP, corporate pre-tax profits
         in BC amounted to 11.1% in 2004. Going back to 1961, profits have exceeded this level only once, in
         1979. Back in 2000, profits were 8.1% of GDP, slightly higher than the historical average. Thus, as of
         2004, capital now captures 3% more of GDP income, while labour receives 3% less (as compared to 2000).
               This shift is a major departure from historical norms. And this is before accounting for the corporate
         tax cuts in recent years. Federally and provincially, business lobbies have successfully pressed for reductions
         in corporate income and capital taxes. Moreover, personal income taxes have been reduced for those
         with the highest incomes (the top marginal tax rate), and in taxes on investment-related gains, such as
         income from dividends or capital gains. These changes have served to reinforce rising income inequality
         trends rooted in the labour market.

         14       Canadian Centre for Policy Alternatives – BC Office
The stated reason for these tax cuts was to promote a better business climate that would enhance
new investment and spur productivity and competitiveness. Business has also pushed for deregulation
as a means of reducing costs, with similar arguments about economic benefits.
   All of this might not be such a bad thing if businesses were using their swelling profits to re-invest
in the BC economy. Yet, according to a productivity database maintained by the Centre for the Study
of Living Standards, in 2004 BC generated about $36 for every hour of work put in, an amount essentially
unchanged since 2002 after we take into account inflation, and up only slightly from 2001. Another
view is from the provincial statistics agency, BC Stats. By its count, the data show a slight downward
trend in productivity over this timeframe.
   Looking forward, the economy remains vulnerable on a number of fronts. First, a continued rise in
interest rates would negatively affect many people because household debt levels are very high relative
to income. BC’s personal savings rate has been negative since 1997, and the trend worsened in 2004 to
–8% of personal income. One factor is that households are already being squeezed by the impact of high
oil and gas prices.
   As is the historical case, BC’s economy rises and falls with shifts in international demand. The
combination of higher interest rates, high oil prices, a cooling housing market and major structural
imbalances in the US economy could spell trouble for BC in 2006, especially if they serve to dampen
global demand for BC exports. But there is much uncertainty about how these dynamics will play out.
Most forecasters expect a continuation of economic growth in line with trends over the past few years.
   Overall then, the BC economy is currently strong. Our challenge is to ensure that the gains of economic
growth are fairly shared – that women benefit equally with men, and that none are left behind – and
that wise investments are made today for the future while windfall resource revenues and profits are
high.

                                                  BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   15
Women and
the BC Budget
There are a number of ways that budgets impact women differently from
men. Policies and budgetary allocations that help those with lower
incomes disproportionately help women and their families. There are
funding supports for specific programs and services for women, such as
women’s centres and anti-violence services. Other general programs, such
as child care, have a particularly significant impact for women, because
they enhance their choices and opportunities. There is also the nature
of public sector employment, and programs or legislation to promote
equality in employment.
     The broad-based cuts to the provincial budget between 2002 and 2004 are a clear demonstration of
the relationship between budgets and equality for women. In this section, we review the impacts of
provincial budget cuts in a number of areas of importance to women: the loss of jobs in the public sector,
the erosion of employment standards, cuts to public services, and cuts to income support programs. This
section draws heavily on original analyses by Sylvia Fuller and Lindsay Stephens in Women’s Employment
in BC and Allison Brewin and Lindsay Stephens in Legal Aid Denied, both released by the CCPA in 2004.

16      Canadian Centre for Policy Alternatives – BC Office
Public Sector Employment
Due to BC’s spending cuts between 2002 and 2004, over 20,000 public sector jobs were either cut or
contracted out at much lower wages. Nearly three-quarters of these jobs were held by women. The female-
dominated sectors of health support services, education, and the direct public service have been partic-
ularly hard hit.
   Job losses in the public sector were a double blow to women – the public sector is an important source
of secure, equitably paid employment within the broader labour market, and women also rely dispro-
portionately on public services. Overall wages for women in the public sector (in 2002) were higher than
in the private sector. Women in the public sector averaged $23.65 per hour, compared to just $15.11
per hour for women in the private sector. In other words, female private sector workers’ hourly wages
were less than two-thirds of their public-sector counterparts.
   This is not because the public sector overpays workers in general. Rather, it is because the public sector
does not underpay women. Wages earned by men and women with comparable jobs, experience and
education are not statistically different in the public sector. But women in the private sector are system-
atically paid less than their male counterparts.
   Many public sector workers who retained their jobs have faced wage freezes and rollbacks, in several
cases through contracts imposed unilaterally by the government. Some of the greatest damage on this
front was in the health care sector. At a time when other health care professionals were receiving wage
increases, a variety of health support work was contracted out (leading to dramatic pay cuts), while others
were forced to accept a 15% wage cut. This has led to greatly reduced morale and it is likely that produc-
tivity losses have offset any cost savings to the government.

Education and Training
Education and training are crucial paths to economic well-being. Workers with more education earn higher
wages generally, and the gender wage gap between men and women is also smaller among more highly-
educated workers. BC women with less than eight years of education earn only 63% of what men at the
same educational level earn, whereas women with a Bachelor’s degree earn 85% of their male counter-
parts’ income, and for women with graduate degrees earnings rise to 95% of men’s.
   Recent changes make access to post-secondary education especially problematic for students with fewer
financial resources. Non-repayable student grants were eliminated. During the three years that tuition
fees were deregulated (as of 2005/06, tuition fee increases are limited to the rate of inflation), fees doubled
at BC’s colleges and universities. These changes disproportionately impact women because their lower
earnings make it harder to pay fees up front and to repay higher loan levels after graduation.
   In the past single women with children could remain on income assistance and take out a student
loan to cover their tuition fees and books. The provincial government has made full-time students ineligible
for income assistance (with the exception of people with disabilities). This reflects a shift in focus to
job-readiness training for immediate work placement. By closing the door to more meaningful education
and training opportunities, the government has made it considerably harder for vulnerable women, and
in particular single women with children, to secure stable, well-paid employment, and to escape and
remain out of poverty.

                                                     BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   17
Care Work
Because women perform the majority of unpaid “care work,” such as child care and elder care, provincial
government cuts in these areas increase many women’s work burden, which in turn affects their ability
to participate in the labour market. Women who undertake unpaid caregiving are more likely than men
to change their work patterns (work part-time, change jobs, reduce their hours, turn down career oppor-
tunities, etc.) in order to accommodate family responsibilities.
     Subsidies to support child care for low-income parents were cut in 2002. Though they were later restored
in stages, and even increased last year, much damage was done. The number of low-income children in
the regulated child care system dropped, and many centres in low-income neighbourhoods were forced
to close. Overall, there are licensed child care spaces to accommodate only 14% of BC children.
     Just as women tend to be primarily responsible for child care, so too do they assume a dispropor-
tionate burden for the care of other dependent family members, such as the sick, disabled, and elderly.
Recent health care restructuring in BC has reduced the availability of hospital and long-term care beds
as well as home care services. This has shifted what was paid work in the health care system (performed
mainly by women) to unpaid care work by women in the home.

Deregulation of Employment Standards
Changes made to the Employment Standards Act in 2002 have reduced legal protections for workers. These
minimum standards are especially important for women because they are over-represented in low-paid
and precarious jobs. Women make up the majority of minimum- and low-wage workers in BC. They are
more likely to hold part-time and temporary jobs and to work in small, difficult-to-unionize private sector
workplaces that tend to pay low wages and where minimum employment standards are especially
important.
     Changes to employment standards include:
          •     The minimum shift length was reduced from four to two hours;
          •     A $6 per hour “training wage” was introduced for the first 500 hours of work (a cap which
                may be difficult for individual workers to enforce);
          •     Those who have not worked 15 of the last 30 calendar days before a statutory holiday are
                no longer entitled to these holidays;
          •     The introduction of “averaging agreements” allows employers to avoid limits on hours of
                work in any given day or week without having to pay overtime, provided hours in the overall
                period average 40 hours per week or less; and
          •     Pregnancy leave must now be taken in consecutive weeks, making it difficult for women
                who experience complications early in pregnancy to schedule needed time off.
     Farm workers are now excluded altogether from regulations related to hours of work, overtime and
statutory holiday pay. In BC, 62% of harvesting labourers are women, and 78% are immigrants. This
change is especially disturbing in combination with the deregulation of child labour.
     Unionized workers are now excluded from provisions on hours of work, overtime, statutory holidays,
vacations and termination of employment. This change makes it harder for unions to negotiate wages
and working conditions that go beyond the minimum standards, particularly in low-wage sectors. Since
unions generally help to narrow the wage gap, measures that weaken the strength of unions may have
a negative effect on the gender pay gap.

18      Canadian Centre for Policy Alternatives – BC Office
Monitoring and enforcement of the regulations that remain has been weakened. Employers are no
longer required to post employment standards rules in the workplace, and the time limit for making a
complaint has been reduced from two years to six months. Of critical importance, complaints can no
longer be made to the Director of Employment Standards, who was previously obligated to investigate.
Workers must now use a complicated “self-help kit” that is available only in English. The Director is no
longer required to investigate these complaints.
   These changes are especially problematic for vulnerable workers, disproportionate numbers of whom
are women of colour and recent immigrants, who are likely reluctant to confront their employer for
obvious reasons. As a recent CCPA report by David Fairey notes, these changes resulted in the number
of employment standards complaints dropping by a staggering 61% between 2000/01 and 2003/04 (the
last year for which full-year data was available).

Social Assistance
Changes to income assistance policies in British Columbia have made it
increasingly difficult to access welfare benefits as an alternative source of
income, and benefit levels have been lowered for some recipients (such                    Because access to work that is
as single parents). Women are more likely than men to rely on income                      secure and well-paid is still
assistance, and are therefore more affected by changes in its provision.
                                                                                          problematic for many women,
   The overarching goal has become to place welfare recipients in
employment, regardless of whether the job provides decent work at a living                a lessening of “dependence”
wage. Yet achieving economic security through employment is predicated                    on the state may in fact be
on good wages, job security, and having some control over the
                                                                                          replaced by continued
conditions of work. Public supports such as child care are essential if women
with children are to make a transition from welfare to work.                              hardship and/or increased
   Because access to work that is secure and well-paid is still problematic               economic dependence on
for many women, a lessening of “dependence” on the state may in fact
                                                                                          family members.
be replaced by continued hardship and/or increased economic dependence
on family members.
   Adequate income support is also vital for many women to feel financially able to leave violent or
abusive homes, to ensure women are not compelled to turn to selling sex, and so that women have enough
income to care for their children and avoid the apprehension of their children by the state.

Legal Services
In 2002, the province dramatically cut legal aid coverage in BC. Family law legal aid was substantially
reduced and poverty law services were eliminated. The budget for the Legal Services Society (LSS), which
provides legal aid services to British Columbians, was slashed by almost 40% over three years.
   While these cuts have affected all British Columbians, they have had a disproportionate impact on
women. Women’s need for legal services and representation is overwhelmingly in the areas of family or
civil law, not criminal law. However, legal aid coverage in BC is now almost entirely for criminal law
matters. Prior to the cuts, women received only 38% of LSS services; following the cuts, that dropped
to 30%.

                                                     BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   19
Further restrictions have been placed on legal aid eligibility. Family law legal aid is now available
only to someone who is fearful for their own safety or that of their children. Legal representation used
to be provided for custody and access, maintenance and other family law issues. Using the presence of
violence as a threshold for eligibility is wholly inappropriate given the complexities of domestic violence.
Only access to adequate, quality legal representation based on need, not violence, will ensure that victims
of domestic violence are able to free themselves of violence and abuse.
     Without adequate legal representation, women are losing custody of their children and giving up
legitimate rights to spousal support.
     In addition to family law changes, provincial funding for poverty law (legal aid to low-income people
denied income such as welfare or EI) and immigration law was completely eliminated by the cuts. Before
the cuts, almost 40,000 British Columbians each year had legal assistance with poverty law matters; during
the last year, that number is no longer recorded, though some services are being offered through the
pilot LawLine.
     The cut to immigration law legal aid has meant that women who have been abused and are without
landed status to stay in Canada may be faced with staying in an abusive relationship with their sponsor
(partner) or being deported.

20      Canadian Centre for Policy Alternatives – BC Office
BC Budget and
Fiscal Framework
This section reviews budget trends going back to 2000/01 and looking
forward to 2007/08 based on the government’s current three-year fiscal
planning framework. We look at changes in revenues, expenditures and
the provincial bottom line in dollar terms and as a percentage of GDP.5
   Table 1 sets out the status quo fiscal situation for BC (i.e. the budget in the absence of any future
policy changes). The table draws on official budget numbers: finalized numbers for 2000/01 and 2004/05,
with updated estimates for 2005/06 through to 2007/08 drawn from Ministry of Finance quarterly reports.
Good economic times are reflected in the state of the BC budget. BC has shifted in two years from the
largest deficits in provincial history to the largest surpluses. In 2004/05 BC’s surplus was a record $2.6
billion. For the current year (2005/06), the official budget estimate from the Ministry of Finance’s Second
Quarterly Update is a surplus of $2.9 billion (stated as a surplus of $1.6 billion plus a $300 million forecast
allowance and a $1 billion provision for early completion of collective bargaining agreements).
   Thus, even if all of the $1 billion for early signing of collective agreements is used up, at the end of
the fiscal year the anticipated surplus will be in the $2 billion range – and given conservative assumptions
and contingencies built into the budget framework, perhaps even greater.
   The surpluses for the next two years will also likely be much greater than the $1.2 billion (2006/07)
and $1.3 billion (2007/08) currently forecast in the government’s three-year fiscal plan (including the
forecast allowances budgeted for these years). Under the government’s framework, provincial own-source
revenues (not counting contributions from the federal government or Crown corporations) would drop
dramatically from 16.8% of GDP in 2005/06 to 15.4% and 15.0% in 2006/07 and 2007/08 respectively.

                                                     BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   21
Table 1: BC Fiscal Framework: Looking Back, Looking Forward
                                                                    Actual              Government’s three-year plan
                                                              2000/01     2004/05     2005/06     2006/07     2007/08
                                                   Revenues (millions of dollars)
 Taxation
     Personal income tax                                         5,963        5,050      5,745        5,674        6,008
     Corporate income tax                                        1,054        1,255      1,498        1,223        1,099
     Sales tax                                                   3,625        4,156      4,163        4,427        4,649
     Fuel tax                                                      715          904        905          947            979
     Tobacco tax                                                   460          699        690          690            690
     Property tax                                                1,452        1,661      1,717        1,789        1,859
     Property transfer tax                                         262          604        750          600            550
     Other taxation revenue                                        772          588        561          546            556
     Total taxation revenues                                    14,303       14,917     16,029       15,896       16,390
 Natural resources
     Natural gas royalties                                       1,249        1,439      2,449        1,714        1,764
     Columbia River Treaty                                         632          258        355          285            265
     Other energy and minerals                                     669          612        787          796            731
     Forests                                                     1,341        1,363      1,245        1,007        1,008
     Other resources                                               308          301        325          380            384
     Total natural resource revenue                              4,199        3,973      5,161        4,182        4,152
 Other revenue
     Medical Services Plan premiums                                894        1,465      1,460        1,437        1,444
     Post-secondary fees                                           440          836        900          935            974
     Other health care related fees                                411          189        196          173            173
     Motor vehicle licenses and permits                            339          381        398          410            424
     Other fees and licenses                                     1,068          750        707          700            665
     Othera                                                      3,320        3,079      3,022        3,044        3,133
     Total other revenues                                        6,472        6,700      6,683        6,699        6,813
 Contributions from government enterprises                       1,725        2,412      2,219        2,259        2,197
 Federal transfers                                               3,284        5,231      5,648        5,362        5,579
 Total revenues                                                 29,983       33,233     35,740       34,398       35,131
                                                 Expenditures (millions of dollars)
 Health                                                          9,555       11,633     12,646       13,019      13,264
 Education                                                       7,856        9,022      9,531        9,766        9,992
 Social services                                                 3,276        2,665      2,845        2,935        2,986
 Protection of persons and property                              1,313        1,215      1,364        1,267        1,254
 Transportation                                                  1,577        1,603      1,531        1,472        1,621
 Natural resources and economic development                      1,776        1,670      1,585        1,497        1,478
 General government                                                435          505        634          609            590
 Debt service                                                    2,050        1,317      1,239        1,325        1,352
 Other                                                             590        1,028      1,428        1,308        1,294
 Total expenditures                                             28,428       30,658     32,803       33,198       33,831
 Surplus (deficit) before accounting
                                                                 1,555        2,575      2,937        1,200        1,300
 adjustments and forecast allowance
 Compensation provision                                                                 (1,000)
 Accounting adjustments                                            (52)
 Forecast allowance                                                                       (300)       (600)        (900)
 Surplus (deficit)                                               1,503        2,575      1,637          600            400
 Notes and sources on page 40.

22      Canadian Centre for Policy Alternatives – BC Office
This is highly unlikely – in the absence of major fiscal changes, revenues tend to stay at about the same
level of GDP over time.
   Some of the 2005/06 surplus reflects federal equalization payments to BC and surging resource royalties
that may not be repeated in 2006/07 or subsequent years (a new formula for determining equalization
payments is being designed by Ottawa, and resource royalties will fluctuate with foreign demand for
BC’s resources). To be prudent, we can estimate revenues over the next three
budget years by assuming that own-source revenues-to-GDP revert to the
2004/05 level of 16.3% from 16.8% in 2005/06.                                                                Government revenues are
   On this basis, government revenues are currently understated by $1.6 billion                              currently understated by
in 2006/07 and $2.6 billion in 2007/08. Combined with the government’s
own projected surpluses, this provides substantial fiscal room to make strategic
                                                                                                             $1.6 billion in 2006/07 and
investments in BC’s economy. In other words, the projected surpluses for the                                 $2.6 billion in 2007/08.
next two years are $2.8 billion in 2006/07 and $3.9 billion in 2007/08.
                                                                                                             Combined with the
   At first glance, many may dismiss our estimates as overly optimistic. Yet,
over the past four budgets, estimates of deficits and surpluses at budget time                               government’s own projected
have been underestimated (that is, lower than expected deficits and higher                                   surpluses, this provides
than expected surpluses) by a cumulative $7.9 billion (Figure 2). The starkest
                                                                                                             substantial fiscal room to
differences have been in the past two budgets, which have been understated
by $2.5 billion and $2.7 billion respectively. In this context, our estimates                                make strategic investments.
for the next two years are quite reasonable.
   Indeed, BC’s strong budget position in 2004/05 and 2005/06 is a signal that the spending cuts of
January 2002 and thereafter, with all the harms to women that they caused, were not necessary. BC has
the financial resources to create and maintain a more equal and just society, including making a concerted
effort to fight poverty, to allow for decent wage increases in the public sector after a few years of restraint,

   Figure 1: BC Surpluses and Deficits

   Note: Figures for 2000/01 and 2001/02 are prior to accounting adjustments. Figure for 2005/06 is prior to government
   compensation provision of $1 billion and $300 million forecast allowance. Projected surpluses for 2006/07 and 2007/08
   are based on Solutions Budget estimates.
   Source: Ministry of Finance; CCPA calculations.

                                                               BC SOLUTIONS BUDGET 2006 | Budgeting for Women’s Equality   23
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