British Columbia's new finance minister said she is "realistic" about the economic challenges facing the province after announcing this year's record deficit is projected to reach $9.4 billion.

Brenda Bailey said Tuesday that the forecasted deficit for 2024-2025 has grown by $429 million from the $8.9 billion estimated in the last fiscal update in September, mainly due to lower revenues.

But Bailey said the rising deficit projection will not change the provincial government's intention to make "smart, targeted investments" to grow the economy, rather than cutting services.

She also promised affordability relief for B.C. residents on the path to a balanced budget.

"It's my view (that) you can't pour from an empty cup," Bailey said of the need to build up the economy instead of short-term cuts. "And so, the work to fill that cup and to really unlock the economic potential that exists in British Columbia is work that's ahead of us, and I'm really looking forward to doing it."

Then-Finance Minister Katrine Conroy presented B.C.'s last quarterly financial update in September with what was then a record $8.9 billion budget deficit for this year, a figure that was already $1.1 billion higher than a previous update.

Conroy said at the time that the deficit increase was driven largely by lower corporate income taxes and natural resource revenue as well as costs for fighting wildfires, and Bailey said many of those situations have not changed, including lower than expected federal profit projections for corporations.

Bailey also said lower anticipated consumer spending, declines in forecasted natural resource revenues stemming from lower natural gas prices, and higher net spending by health authorities all contributed to the latest rise in the deficit.

In a written response to the latest fiscal update, B.C. Conservative Finance Critic Peter Milobar said the report "reveals a province sinking deeper into debt, plagued by revenues falling short of expectations and cost overruns on major projects."

"If voters had seen this update before the election, I'm confident that David Eby would not be the premier today," Milobar's statement said.

The fiscal update also included some infrastructure projects where anticipated costs have increased, including the Broadway SkyTrain extension in Vancouver from about $2.83 billion to $2.95 billion and the Pattullo Bridge replacement from $1.38 billion to $1.64 billion.

"Meanwhile, our economy is slowing down, our budget deficit is expanding, and resource and business tax revenue is dropping," Milobar said. "The government's economic and fiscal update speaks for itself."