Former finance minister credits Alberta for Norway’s successful oil wealth fund

A former Norwegian finance minister says Alberta’s new government should take inspiration on handling resource revenues from the same place her country found it — Alberta.

“We were inspired by Alberta when we established our sovereign wealth fund,” said Kristin Halvorsen, who was Norway’s finance minister from 2005 to 2009.

Alberta’s new NDP government has promised to review how the province’s oil royalties are raised and spent. That includes a look at the Heritage Savings Trust Fund, which was created by former premier Peter Lougheed in 1976 as a nest egg and repository for some of Alberta’s non- renewable resource revenues to prevent them from distorting annual budgets.

It sounded like a good idea, said Halvorsen, in Canada for a speech at a conference in Ottawa.

“These are revenues from a nonrenewable resource and we should take care of those generations after us,” she said Wednesday. “Both the revenue from the oil and gas sector and the production are volatile, and we need some protection to avoid that affecting the budgets from year to year.”

All of Norway’s resource revenue goes into a sovereign wealth fund, with a percentage siphoned off every year for government operations. The total value of the fund is about $ 1 trillion and Norway takes about $ 40 billion a year from it for government finances, almost the size of the Alberta budget.

Halvorsen said it wasn’t always easy keeping politicians’ hands out of the oil royalty cookie jar. “It’s always hard to explain why you can’t just use one more billion.”

But she said there’s now wide agreement in the country about the wisdom of saving the money.