WHERE’S THE PLAN?

There’s both good and bad news in the Notley government’s first-quarter financial update. Let’s start with the positive: After Alberta’s economy shrank by 3.5 per cent last year owing to a collapse of oil prices below $30 a barrel, things are definitely looking up in the first half of 2017. Some of the economic green shoots Finance Minister Joe Ceci is so fond of invoking have indeed sprouted. With oil averaging around $47.90 so far this financial year, the province seems to be on the road to recovery with gains in housing, retail sales, exports and jobs.

Alberta has added nearly 17,000 jobs so far this year while overall employment is projected to grow by 1.3 per cent, up from 0.9 per cent forecast in the March budget. Meanwhile, the number of rigs drilling so far this year has doubled from the same period in 2016. Housing starts are up 23 per cent year-over-year and non-energy exports rose 7.1 per cent.

But while those green shoots are growing into stalks, the bad news is they have yet to bear fruit for a government still struggling to find a long-term answer for sluggish oil prices, a lack of high-paying jobs and stifled income-tax revenue.

Ceci resorted to some financial lifelines to keep the deficit at $10.54 billion — up slightly from the $10.49 billion forecast in Budget 2017 — despite lower-than-expected oil prices and increased debt-servicing costs.

It’s disconcerting that after one fiscal quarter, the government has already used half of the $500-million financial buffer it built into the budget to cushion see-sawing resource revenues.

Ceci also expects to find operational savings of $400 million, but offered few details about where those reductions will come from.

Similarly, the government has yet to reveal the overall plan behind its promise to balance the books by 2023.

While the Klein government slayed the provincial deficit with deep cuts to jobs, programs and infrastructure spending, Edmontonians — many who work in the public sector — experienced first-hand the pain that comes with that scorched-earth approach.

Gambling on the belief that many Albertans have little appetite for slash-and-burn budgets, the NDP government has consistently rejected calls to make big spending cuts.

It’s a compassionate approach, but there needs to be a sound financial strategy behind it. So far, Ceci has offered no specifics on how he will balance the budget. Is the idea really just waiting for an oil-price rebound and economic diversification, as the opposition charges?

Ceci is on the clock to produce a better plan because the next election will almost certainly be won and lost on how best to balance the books.