Alberta will be diving deeper into the red as the Province is on track to post a $10.3 billion deficit this year and adding billions to a rapidly growing debt.
Highwood MLA Wayne Anderson called the budget, unveiled in the provincial legislature on March 16, a “debt-fuelled disaster.”
The NDP-led Province is forecasting a $10.3 billion deficit next year. The deficit is expected to drop to $9.7 billion in 2018-’19 and $7.2 billion the following year. However, the NDP plans to borrow $15.2 billion this year and it is on track to borrow nearly $30 billion in 2019-’20. Two years ago the Province borrowed $944 million.
Alberta's debt is expected to grow to $71 billion by 2020.
“The sad part is they keep climbing into debt, Albertans are going to be holding that debt for a long-time, generations to come,” said Anderson. “They’re really mortgaging the future for generations.”
He said there is no plan to balance the budget and repay the debt.
Interest costs are also rising. This year, the Province is expected to pay just under $1.4 billion in debt servicing, and it’s expected to rise to $1.8 billion next year and $2.28 billion in 2019-’20.
Finance Minister Joe Ceci said in his budget speech the Province is taking a long-term view and won’t make significant cuts that could hurt Albertans.
He said the budget is intended to make life better for ordinary Albertans.
“Families want our government to keep investing in long-overdue repairs and modernizations of our schools and hospitals, and they want us to keep improving our roads and highways,” said Ceci. “They want us to make things more affordable and bring the deficit down, thoughtfully and prudently.”
The budget includes a projected $45 billion in revenues, and $54 billion in expenses this next year. The Province will spend $21.4 billion for health and $8.2 billion for education with another $6 billion for advanced education. Community and social services will get $3.3 billion and there is $1.4 billion for children’s services.
Spending growth is below the combined rate of growth for population and inflation. As well, there are no new taxes or tax increases in the budget.
“Some said – and still say – that government should make deep cuts to public services, such as health care and education,” said Ceci. “Some wanted to implement a health-care tax that would have hurt families who could least afford it. Families would have been forced to pay more and get less, with longer health-care wait lists, overcrowded emergency rooms, much bigger class sizes, and lost jobs.”
Ceci said the Province is continually looking to save money.
He said it expects to save $16 million a year by freezing management salaries for agencies, boards and commissions and reviewing salaries. The Province has found more than $500 million in savings over the last two years and it will continue to search for more ways to save money. The Province is also bringing down the growth rate for health spending, while protecting patient care.
Anderson said the NDP needs to do more to balance the books, such as cutting bureaucracy and middle managers, and finding efficiencies to reduce spending.
He said the Wildrose Party is not calling for cuts to front-line services.
“The reality is we’re saying look at your organization, look at our efficiencies and let’s best manage it, but live within your means,” said Anderson.
Okotoks Mayor Bill Robertson said he is still reviewing the budget to see what it will mean for Okotoks, though there was no commitment to the Town’s number one priority.
The budget does not include a commitment for an Okotoks water pipeline, but it maintains funding to a key program the Town hopes to tap into to pay for the project.
The Town is asking the Province to help pay for the estimated $35 million price tag for the pipeline. Ideally, the Town is asking for funding through the Water for Life program, which covers up to 90 per cent of the price of projects.
The budget includes $55 million for the Water for Life Program for this year, and $320-million over the next four years.
Robertson said he's disappointed there wasn't a funding announcement for the Okotoks water pipeline.
“Our backs are against the wall,” he said. “We understand there's a lack of provincial revenue. I feel if they're going to be borrowing money or creating a deficit, we should be at least included in the spending.”
Robertson said the Town isn't looking for a cheque, just a commitment the money will come.
In the meantime, he said the Town is looking at alternative funding plans for a pipeline, including the federal government.
