This puts the interest rate for these terms at 5.39% as of Tuesday for both banks. Last week, BMO, CIBC and other major Canadian banks reduced their key mortgage rates 10 basis points to 5.49%
In my opinion, this is to provide a slight stimulus to the economy, especially given that the interest rate decrease was not larger.
B.C.'s budget deficit should be $73 million higher than reported, says a report released Thursday by the province's auditor general, who took issue with the way the government accounted for a massive infrastructure project.
John Doyle reviewed the government's financial statements for the 2009/2010 fiscal year and in a 62-page report, concluded B.C.'s budget deficit should be $1.85 billion as opposed to the $1.77 billion reported by the government.
"I suspect if you went out to citizens and said, 'Is $73 million a lot of money?' they'd probably say 'Yes,"' said Doyle.
Opposition New Democrat Rob Fleming said the Liberal government's deficit grows with Doyle's report.
Fleming said the Liberals campaigned in May 2009 on a promise that the budget deficit would be no higher than $495 million, but the actual deficit number turned out to be more than three times that.
"Government was fast and loose with the facts about that," he said. "They are facing a crisis of trust on financial issues and I think the auditor general's report has reminded us what kind of accounting trickery they have been using."
Doyle's report included three reservations regarding the government's method of accounting, saying it deviates from the accounting norm, known as generally accepted accounting principles or GAAP.
He said the government is not following GAAP when it comes to the $3.2 billion Port Mann Bridge project, the largest infrastructure project in British Columbia history.
Finance Minister Colin Hansen said Doyle raised the same three budget objections in last year's report, but the government did not make any changes because it received the endorsement from the Finance Ministry's comptroller general, who essentially monitors and ensures the integrity of the province's books.
"He did not take issue with the transparency of our public accounts -- that everything is disclosed -- he just has disagreements with the accounting principles we apply to those three items," Hansen said.
"This comes down to differing opinions between the comptroller general and the auditor general as to what constitutes generally accepted accounting principles."
The government classified the Port Mann project as a revenue generator on the books when it will take 40 years to pay for itself, said Doyle.
"Yes, it is a big deal," he said. "Basically, government is saying that this is a commercial activity which is self-sustaining when in fact they haven't even built the bridge yet."
The government is working on a revised bridge funding model that it will present to the auditor general later this year, the report said.
Doyle's report said his increased deficit number also results from the government subtracting royalty credits for oil and gas producers from revenue rather than reporting them as expenses.
As well, the government is not recording liabilities for deep-well credits owed to oil and gas producers, he said.
The report said the government did adjust 25 other monetary issues that were of concern to the auditor general.
