Alta. economy better but deficit still $10.8B
EDMONTON (CP) — A rebounding oil sector is delivering an extra $1.5 million to the Alberta government this year, but Finance Minister Joe Ceci says that money — and more — has already been spent and the deficit will remain at $10.8 billion.
Critics say no matter whether times are good or bad, Premier Rachel Notley’s government lacks the will and the fibre to make hard decisions needed to balance the books.
“We’re still very early in the recovery phase. Alberta families are worried about the basics and the government is focused on basics,” Ceci said on Thursday as he released the third-quarter update for 201617. “We’re here to make life better for Alberta families.”
The update shows Alberta is on track to take in $42.9 billion this fiscal year, which ends March 31.
But $1.5 million in gains are offset by an extra $2.6 billion in spending.
The province, at the suggestion of the auditor general, is booking a $1.1-billion accounting expense now for payments to be made over the next 14 years to move the electrical industry off coal-fired power by 2030.
The province is also spending $774 million more than planned to cover higher operating costs, mainly in health, education and social services. There is another $818 million for disaster assistance needed after severe flooding in 2013 and last spring’s Fort McMurray wildfire.
To keep the deficit from ballooning to $11.5 billion, the province is throwing in a $700-million cushion it had kept to guard against low oil prices. Ceci said Alberta is committed to reducing the deficit and debt and cutting the cost of government.
“We’re looking at all areas to reduce expenditures and in the (2017-18) budget coming up next month we’ll even have more of those identified,” he said.
Government borrowing is expected to reach $32.3 billion against $19.7 billion in the Heritage Savings Trust Fund. Ric McIver, interim leader of the Progressive Conservatives, said the government does not have the will to rein in spending.
“They can’t make the tough decisions that Albertans need them to make,” he said. “They can’t differentiate between what Alberta needs and what they would like to offer up to get them re-elected (in 2019).”