Provincial debt overview
Debt represents funds the Province of British Columbia has borrowed to finance government operations and capital projects, such as the building and maintenance of schools, hospitals, roads and other capital assets.
The provincial government incurs debt when total expenditures exceed total revenues. The Province borrows money from investors in the form of bonds and in return the Province pays interest to the investors until the bond principal is repaid at maturity. Capital assets are expected to last a long time and benefit both present and future B.C. residents. Therefore, the cost is spread out over the life of the assets and shared by all those who will benefit from them during the asset's projected lifespan.
The provincial government also provides financing to government bodies (e.g. Crown corporations) and other organizations including some local governments.
To meet the needs of a growing economy, significant capital investments are planned over the coming years. Capital requirements over the next three years are outlined in the debt summary. In addition, the debt summary provides details on how much debt the Province has outstanding and how much the Province plans to borrow over this same period.
Gross market debt outstanding
British Columbia borrows from a variety of sources, including domestic and international capital markets, the Canada Pension Plan Investment Fund, institutional lenders and provincial trusteed funds.
View the Province's diversified funding sources and currencies:
Net debt maturities
Net debt maturities show the total gross and net debt outstanding for the B.C. government and government bodies combined:
Bond issuance activity
Capital market activity of the Province containing details of the long-term bonds which remain issued and outstanding:
Most of the government's foreign currency exposure can be effectively hedged through various financial instruments, including cross-currency swaps which reduce the risk of foreign exchange exposure. The government uses interest rate swaps to hedge against interest rate risk.
Bonds are issued in fixed or floating (variable) rate form. The Province defines floating rate debt to include all long-term debt maturing within 12 months, fixed-rate long term issues which have been hedged to floating rate instruments, and all short-term commercial paper or promissory note debt outstanding.
The direct debt profile shows the portion of outstanding taxpayer-supported debt of the Province that has foreign exchange exposure and how much of this same taxpayer-supported debt is fixed versus floating:
Strong investor demand for British Columbia debt securities together with a broad investor base help minimize financing costs for government. Examples of institutional investors who invest in B.C. bonds include pension funds and insurance companies.
The B.C. government regularly conducts investor relation tours and speaking engagements, and participates in conferences, intergovernmental exchanges and various investor-related activities. Presentations for investors typically include relevant economic data, fiscal and debt overview and topical subject matter.