Journal of Commerce | Jean Sorensen | February 20, 2026
When NDP Finance Minister Brenda Bailey’s 2026 budget speech announced the government was re-pacing several large and planned capital expenditures, it plunged billions of dollars in projects into a freefall with no delivery timeline.
The largest of these was phase two of the Burnaby Hospital Redevelopment, which is expected to cost $1.7 billion with funding from the province, Burnaby Hospital Foundation and BC Cancer Foundation. Construction was slated from 2025 to 2030.
The multi-party contract, known as a single target outturn cost alliance development agreement, involving PCL Constructors Westcoast Inc. and Parkin Architects Western Ltd., was signed and approved on June 21, 2024.
“They were already procuring subtrades for that project and contracts worth tens of millions of dollars,” said Jordan Bateman, vice-president of communications and advocacy for the Independent Contractors and Businesses Association.
Bateman blames the government’s over-spending on projects using Community Benefits Agreements which have caused the severe budget belt-tightening, cutting back on promised projects throughout B.C. “It is a mess, but it is a mess they have created,” he said, calling the 2026 budget “awful for construction.”
Also pushed back with no definitive timeline is the construction of more than $1 billion in promised long-term care facilities as the NDP claim it wants to “incorporate the lessons learned from project already underway and from its ongoing review of the long-term care infrastructure program.”
Facilities affected include long term care facilities in Abbotsford ($211 million), Campbell River ($134 from Island Health), Chilliwack ($274 million), Kelowna’s Cottonwood replacement costing $187 million, Delta ($180 million), Fort St. John ($155 million) and Squamish (Hilltop replacement cost $286 million).
Also in limbo is $178 million University of Victoria’s 510-bed residence project.
The budget includes a $38 billion capital expenditure plan stretching over three fiscal years, but currently there are no proposals in ensuring fiscal plans revisit these re-paced projects.
The provincial government is also slowing the pace of delivering on its housing strategy and will re-allocate $1.4 billion from it over the three years of the fiscal plan. A portion of the re-allocated money will come from closing the Community Housing Fund indefinitely. The fund had been intended to support building affordable rental homes.
Construction is also impacted as the NDP bring in a provincial sales tax on professional services such as accounting, bookkeeping, architectural, geoscientist and engineering services, commercial real estate fees and security and private investigation services. The PST, effective Oct. 1, is expected to add $534 million in 2027/2028 to provincial coffers. This year’s budget increased spending by $3.9 billion, raising the deficit to a historic $13.3 billion. Deficits of $12.2 billion and $11.4 billion are projected over the following two years.
The government is proposing to spend the $38 billion over the next three years supporting existing infrastructure and planning needed downstream infrastructure.
These include affirming funding for 17 major hospitals (including the new $2.174 billion St. Paul’s Hospital under construction) and acute-care facilities in communities including Vancouver, Surrey, Duncan, Kamloops and Williams Lake; transit expansions such as the Broadway Subway project and Surrey Langley SkyTrain; widening Highway 1 and replacing the George Massey Tunnel; 66 major K-12 school additions and improvements in communities including Mission, Prince Rupert and Langley; and student housing projects that will add 3,900 new beds in post-secondary facilities in communities like Nanaimo and New Westminster.
The budget also continues to support Western Canada’s first new medical school in nearly 60 years. The $520 million Simon Fraser University School of Medicine begins construction in late 2026.
Commenting on the budget, British Columbia Construction Association president Chris Atchison said: “The emphasis on construction and infrastructure development in this budget validates the critical economic and social importance of our industry.”
But projects still can’t stall.
“We urge the provincial government to avoid unnecessary delays on key projects such as hospitals and health care facilities and continue to push for progress on infrastructure development,” he said.
The budget also pours unprecedented highs into more skills training which is welcomed by both the construction industry and labour.
The budget allocates $283 million in new funding over three years to expand spaces for in-demand trades training programs, increase per-seat funding to training centres and enhance the B.C. Employer Training Grant to double apprenticeship seats by 2028-29.
“Doubling investment in trades training through SkilledTradesBC, streamlining permitting and establishing the Strategic Investments Special Account are the kind of measures our industry needs to achieve critical goals,” emphasized Atchison.
The BC Building Trades said in a press release maximizing the impact of this $241 million investment in the province’s trades training system will require directing investments to the training providers best positioned to deliver results at scale.
“The BC Building Trades will continue working with government to ensure funding flows directly to non-profit building trades union training schools,” said Brynn Bourke, BC Building Trades executive director, in the statement.
Budget 2026 supports businesses to leverage new opportunities through a new temporary Manufacturing and Processing Investment Tax Credit for investing in new buildings, machinery and equipment.
In support of the B.C.’s maritime sector, which is the largest in Canada, the budget also extends the Shipbuilding and Ship Repair Industry Tax Credit until the end of 2027.