The B.C. Liberal government’s controversial plan to balance its budget by selling off public assets includes the disposal of hundreds of millions of dollars worth of what it is calling “financial instruments.”
Finance Minister Mike de Jong said his government plans to make about $125 million from the sale of various financial assets in the coming year.
De Jong refused to describe them in detail, explaining they are “very, very market sensitive” and that further disclosure could compromise their selling price on the open market.
Officials later said the sale could involve government-held financial assets such as bonds, derivatives or promissory notes.
To make a $125-million profit on the various transactions this coming year, the government would have to sell hundreds of millions of dollars worth of these instruments — if not more — for more money than it paid to purchase them.
The plan comes as part of de Jong’s announced strategy to generate $475 million in 2013-14 from the sales of government assets, a plan that is essential to balancing next year’s budget.
Over two years, the government hopes the program can generate $625 million. The sale of financial instruments will make up about a quarter of the expected revenue for the first year of the program.
Revelations about the financial instruments caught New Democratic Party finance critic Bruce Ralston by surprise.
“This is a little reminiscent of the HST where they’re trying to skate it by without really talking about it,” he said Wednesday.
“At no point anywhere in any public forum, document, anything that I’ve ever heard have they ever mentioned the sale of financial instruments or streams of revenue or anything like that,” Ralston said.
Budget documents released Feb. 19 made no mention of the financial instruments, discussing only surplus properties.
