VANCOUVER -- The BC government will implement "austerity measures" to make up for an unexpected revenue loss of $1.4 billion over the next three years, but even more savings must be found to avoid program cuts or tax hikes, Finance Minister Mike de Jong announced Thursday.

"Reductions in natural gas revenues put pressure on the (budget) plan ... and they are significant numbers," de Jong said while releasing the first quarter report in the capital.

Lower-than-expected natural gas prices will slash more than $1.1 billion from government coffers, while other resource revenues will fall by $300,000.

To balance the budget by 2013-14, de Jong announced a freeze in public service hiring and management salaries, "extreme" controls on travel and discretionary spending, and a review of the bargaining mandate with unions.

"There is clearly no additional money available," he said.

These steps alone account for just a third of the projected $1.4 billion shortfall, raising the spectre of cuts to programs or higher taxes in the February budget.

"We're anxious to avoid impacting the programs that British Columbians rely upon," de Jong said, adding when it comes to tax increases, "It's not our preference."

In addition, he wasn't "optimistic" about finding efficiencies in government and rejected the possibility of not balancing the budget.

"I believe British Columbians value responsible management of their tax dollars and that's what they're going to get."

The BC Government and Service Employees Union (BCGEU), however, questioned why former finance minister Kevin Falcon said in August that the province was "on track for a surplus budget next year."

"How could it have changed so dramatically in one month's time?" BCGEU president Darryl Walker asked in a release.

"We expect that any savings realized by the government's hiring freeze and our overtime ban will go towards a better offer for our members who have not had a raise in three-and-a-half years."