Tuesday, February 17, 2026 – On February 17, 2026, Minister of Finance Brenda Bailey tabled British Columbia’s 2026/27 provincial budget, forecasting a total spend of $98.83 billion over the next fiscal year. Of this, $5.1 billion is new spending, the majority of which ($2.77 billion) has been allocated to the Ministry of Health.
Despite weeks of Minister Bailey foreshadowing an austerity budget focused on addressing the government’s deficit, this budget ultimately looked to “balance” addressing the deficit and continuing key public sector investments, resulting in a projected record deficit of $13.3 billion for 2026/27. Over the remainder of the fiscal term, the government is planning to reduce its rate of borrowing, projecting deficits of $12.1 and $11.4 billion, respectively, in the subsequent two fiscal years. This deficit reduction will be achieved through three priority actions: cutting administrative spending in the public service, increasing tax rates, and generating new streams of revenue.
Overview
- “This budget is different from our past budgets, because this moment is different”: After years of record capital project investments and new program announcements, the 2026/27 budget is much more focused on reigning in government spending. The budget includes plans that have long gone against typical B.C. New Democratic Party (NDP) governance, including public sector cuts, income tax increases, and an enhanced focus on growing the private sector.
- Total health care spending increases, reallocation centered on primary care: While the government announced $2.77 billion in new health care spending, they made several significant changes to the composition of the total budget. The government acknowledges that increased cost of service delivery, due primarily to increased health care worker compensation, forced a reformed allocation of spending within the Ministry of Health. This is in addition to ongoing efforts to cut administrative health authority spending and reallocate it to frontline workers.
- Health focused on expanding capacity and administrative reform over innovative solutions: The budget places three priorities within health care: (1) continuing to fund aggressive health care professional recruitment, (2) keeping major health care capital projects on track, and (3) continuing system redesign through reducing administrative costs and implementing shared services models of procurement and administration. At the same time, digital initiatives are being put on the backburner and some have been moved to the Ministry of Citizen Services.
- Capital investments being phased over a longer period of time: A major part of the budget involved a reduced pace in the government’s ambitious capital project planning. The government announced that they would be phasing the construction of major projects over a longer period, prioritizing capital investments in health care and education. Health will see $11.1 billion in capital project investment over the next three years, a decrease from $15.4 billion outlined in last year’s budget, showing a marked slowdown in the government’s largest ministry. Most projects in health will remain on schedule for construction, including 17 previously announced hospital and acute care construction projects. However, seven previously announced long-term care facilities will have an adjusted timeline.
- Public service audit continues with a goal of 15,000 jobs cut over three years: The government continues to seek greater efficiency within the public service, promising to continue to find further jobs to cut over the next three years. The government has continued to promise that these cuts will affect administrative positions prioritizing the growth and retention of positions within health and education.
- Government announces a diverse range of tax hikes, including a 0.6% increase for the first income bracket: The government announced the first universal tax raise since 2008 by increasing the first bracket paid by all British Columbians from 5% to 5.6%. The government claims that this tax increase would be offset for most low-income earners through an increase in the tax reduction credit of $115.
Health Care Highlights
The health care budget reallocates resources, with a priority focus on improving access to primary care. Of the $2.77 billion in new funding earmarked, more than $2.3 billion in funding is dedicated to increasing capacity and supporting demand growth within primary care. The budget explicitly ties this new funding to delivery settings, including hospitals and primary care networks, urgent primary care centres, and community health centres.
Projected growth in spending through B.C.’s public health insurance plan is contributing to increased physician compensation. The 2026/27 budget presents a high projected total for Medical Services Plan (MSP) growth relative to previous years. The government positions this as a result of increases in compensation for physicians and recruitment numbers for health care professionals. Physician compensation accounts for 22% of total health care spending. Additionally, the government touts its success in workforce growth for the increased expenditure. Since 2017, B.C. reports the following growth in his health workforce:
- +31% increase in physicians
- +23.1% increase in registered nurses
- +33.3% increase in allied professionals
PharmaCare forecast for 2025/26 comes in below the original estimated amount, and the 2026/27 budget reflects this lower figure. Last year, the government announced a flatlining of the PharmaCare budget at $1.787 billion for the next three years. Budget 2026/27 shows that the updated 2025/26 forecast for the PharmaCare branch is $1.506 billion, several hundred million below initial estimates. Accordingly, the PharmaCare budget has been updated for 2026/27 to $1.597 billion. While this appears to be a slight increase from the previous year, it represents a substantial downward revision from Budget 2025 projections.
The review of the province’s health authorities continues, spelling further administrative cuts. To date, the government has identified $60 million in annual savings by reducing 1,100 existing or planned positions, and has identified an additional $200 million in annual spending to reinvest in core primary care services. The government packages this as $780 million in funding reallocated to frontline services over the next three years.
As part of its goals for increased efficiency, the government will centralize non-clinical services through the creation of a shared services organization (SSO). This shared services organization will expand the procurement and administrative scopes of the Provincial Health Services Authority, with all legal, supply chain, finance, human resources, IM and IT, data and analytics, and digital communications across the province being brought under this single SSO.
Government earmarks funding to support implementation of involuntary treatment care beds. The government announced $131 million in new funding for mental health treatment. The majority of this new funding will be dedicated to supporting the implementation of Assertive Community Treatment teams and involuntary treatment beds in Prince George, Surrey, and Maple Ridge.
B.C. anticipates $2.2 billion in federal funding for provincial health care initiatives. The government highlighted three specific sources of funding from the federal government:
- $447 million through the Aging with Dignity agreement, which begins to wind down after the 2026/27 fiscal year before concluding in 2027/28;
- $653 million through the National Pharmacare agreement;
- $1.1 billion through the “anticipated extension” of the Working Together to Improve Health Care for Canadians agreement, which is up for review and renegotiation this year.
Government walks back on digital initiatives commitments, shifts responsibility to Ministry of Citizens Services. The government removed digital initiatives from the 2026/27 health care budget and movied this line item to Citizen Services. While the government acknowledged that they will continue to work on modernizing digital care services, tools, and performance metrics, this work will continue at the Ministry of Citizen Services and the timeframe will be elongated.
Other Health Care Commitments
- The government recommitted to its advertising campaign for physicians in the United States, stating that 140 United States physicians have already accepted jobs in B.C.;
- The government will continue to fund in-vitro fertilization (IVF) at $34 million annually, offering up to 1,800 families a $19,000 one-time credit treatment;
- The government will continue implementing nurse-to-patient ratios across the province, with 85% of first wave ratios expected to be activated in B.C. hospitals by March 31, 2026;
- The government is investing $35 million over three years to support Independent Living B.C., which provides rental support for seniors through the Ministry of Housing and Municipal Affairs;
- The government hopes to continue hitting an attachment rate of 4,200 people/week with a family physician. This would result in 650,000 patients being attached over three years.
Other Notable Budget Commitments
Education and Child Care
- $634 million in new funding for K-12 education over three years.
- This includes a $167 million investment in the Classroom Enhancement Fund, which will fund more teachers, special education teachers, psychologists, and counselors in schools.
- $330 million for ChildCareBC to maintain daycare program subsidies.
- Additional $25 million in new funding to support expansion of child care options on school grounds.
- $475 million in new funding for children and youth with disabilities, providing direct funding support to families.
Community Safety
- $139 million over three years in new funding to reduce repeat, violent offending and chronic property crime.
New Tax Hikes
- Increase the provincial portion of property taxes for homes over $3 million in assessed value.
- Speculation and vacancy tax increased from 3 to 4 percent.
- Property tax deferment borrowing rate increased to 2% above prime.
- PST expanded to a host of professional services, including accounting, architecture, engineering and geoscience services, and commercial real-estate fees.
- Removing PST exemptions on clothing and footwear services, basic cable television, and landline telephone services.
Business and Workforce Incentives
- $241 million to double skilled trades funding over three years;
- Creation of B.C. Strategic Investments Special Account with a $400 million investment. This will provide B.C. businesses with direct investments, equity, and loans to support private-sector growth;
- $40 million over three years to remove barriers and avoid duplication in permitting across the natural-resource and tourism sectors;
- New temporary 15 percent Manufacturing and Processing Investment Refundable Tax Credit for businesses investing in buildings, machinery, and equipment used in manufacturing and processing.
Opposition Reaction
- B.C. Conservative Finance Critic Peter Milobar has condemned the 2026/27 budget as an “assault on seniors, working families, and the small businesses that drive our economy”. The opposition raised concerns over the lack of spending allocated towards strengthening health care in this budget; specifically, the lack of support for seniors and delays in building long-term care facilities.
- The B.C. Green Party says the government is doubling down on a familiar approach of managing decline, while investing in industry-first growth, and going backward on forestry reform, Indigenous relations, and healthy ecosystems. B.C. Greens Finance critic Rob Botterell said the budget is maintaining a status quo that is no longer working – referring to this as a “keep-industry-happy” budget.
Further Reading
Read the B.C. Budget Speech here.
Explore the full budget online here.
Reaction and commentary from media sources: