Inflationary Pressures

In the December issue of Dollars & Sense Perspective, we conducted a survey on how inflationary pressures are affecting budgets in local governments across British Columbia. Specifically, we asked about contingency percentage for capital and special projects, as well as the inflationary increase factored in for casual contractor services. The results from the survey responses are illustrated in Figures 1 and 2 below.

Figure 1: What contingency percentage are you using for capital or special projects?

Figure 2: What inflationary increase are you factoring in for casual contractor services?

Additionally, we asked how local governments arrived at inflationary increases for operations and maintenance cost increases. When projecting operations and maintenance costs for local government projects, 28 percent of local governments reported using the Building Construction Price Index (BCPI). This index reflects changes in the costs associated with building construction, including materials and labour, which are directly related to the maintenance and upkeep of government-owned buildings and infrastructure. Meanwhile, 73 percent of local governments reported using the Consumer Price Index (CPI) to project operations and maintenance costs. The Consumer Price Index (CPI) measures changes in the price level of consumer goods and services purchased by households. Some local governments used both indices, along with alternative information sources, including historical trends.

When budgeting for casual contractor services, the majority (61 percent) indicated that they would increase prior year figures by 3–5 percent, while an additional 22 percent reported planning for a 5–10 percent increase over the prior year. The response was very similar for calculating unknown costs in the budget.

We also asked local governments when they bring their budget to council for mandates. We received a varied response highlighted in the chart below.

Figure 3: Responses from local governments for the timing of the budget presentation/submission to councils by month.

Detailed results for this survey can be obtained by emailing surveys@civicinfo.bc.ca

The next quarterly question surveys Alternative Work Arrangements and Perks.

Please use this link to be a contributor: q.surveypal.com/Quarterly-Question-March-2024-Flexibility---Perks

This short survey should take less than five minutes to complete.