DEBT WILL HIT $96 BILLION
Premier Rachel Notley and Finance Minister Joe Ceci lead the NDP cabinet down the legislature steps Thursday after delivering the 2018 budget.
The government is gambling with Alberta’s future by depending on pipeline revenue to balance the budget, says United Conservative Party Leader Jason Kenney.
“We haven’t got an inch of pipeline in the ground, thanks in part to the NDP’s incompetence,” he said, reacting to the provincial budget Thursday. “They’re banking their entire fiscal plan on a pipeline that’s already been delayed by a year.”
Finance Minister Joe Ceci unveiled a path to balance that included continued borrowing and a debt load of $96 billion by 2023.
The budget was predicated on more than just the Trans Mountain pipeline expansion being built, he told reporters, touting economic diversification and controlled spending. But he reiterated the NDP is confident the $7.4-billion Kinder Morgan Inc. project will break ground.
Alberta’s economy is slated to grow around 2.7 per cent in the coming year with a projected deficit of $8.8 billion. But the province’s total debt including borrowing for operating costs will rise to $54.2 billion. And when the budget is balanced in 2023-24, debt will balloon to $96 billion. Kenney blasted the plan. “We will be spending billions on interest payments to bankers instead of funding public services,” he said, calling the budget a “reckless fiscal plan.”
Last year, Premier Rachel Notley signalled fiscal restraint and warned of compassionate belt-tightening.
Kenney hearkened back to the phrase: “I thought that they would be making a real effort to reduce the deficit and stop the growth in debt, but they ’ve just thrown caution to the wind.”
Alberta Party Leader Stephen Mandel also slammed the budget.
“It’s scary,” he said, referencing potential credit downgrades from rating agencies. “We’ve got to come up with a better way to do it. It starts with trying to control some of the costs.”
He said the budget failed to take into account that the pipeline expansion may not be operating for several years. Today, it’s not built, he added.
“That’s really not a way for governments to try to balance their budget, on a hope and a prayer that we’re going to get a pipeline.”
In a shadow budget released Wednesday, the Alberta Party called for reduced spending in health care. Mandel, a former health minister under the Progressive Conservatives, criticized a three-per-cent health budget increase.
Health care accounts for more than 40 per cent of government operating expenses.
“We’re increasing the health plan, we’re increasing administrative costs,” he said. “That’s a $700-million approximate increase ... I don’t know how we’re going to manage that each year for the next number of years.”