A TALE OF TWO BUDGETS
Over the last two years, the folk-hero renown of Saskatchewan Premier Brad Wall has skyrocketed to near-mythic proportions among Albertans. Many, especially conservative-minded politicians, tout the centre-right Wall in the province next door as an exemplar when it comes to governing a prairie province similar in many ways to Alberta. Both provinces lean heavily on resource revenue, which stoke heated economic booms when prices are good but falter when commodities markets careen downward.
In these tough times, Albertans often look eastward to second-guess the policies and legislation introduced by their province’s own NDP government. “What would Brad Wall do?” they ask in any given scenario.
The respective budgets put out by the two regimes within days of each other provide some perspective on the matter.
First, the budget released March 16 by Premier Rachel Notley’s government spared both government programs and public-sector jobs. It held the line on taxes.
It also promised to sink $9.2 billion into new schools, health facilities, roads and other projects. To do that, the government is borrowing $6 billion for capital projects and $6.4 billion to keep the lights on. It brings Alberta’s debt to $45 billion. The deficit is to reach $71.1 billion by 2019-20.
The Alberta government hopes to balance the books by 2023 but has yet to lay out a plan. Notley insists keeping money in the economy will bring it out of recession sooner while “making life better for everyday Alberta families.”
Last Wednesday, the Saskatchewan government unveiled a no-pain, no-gain approach to address its grim financial picture.
The Wall government increased the provincial sales tax to six per cent from five and scrapped exemptions on items like children’s clothing, restaurant meals and construction services. It boosted sin taxes on tobacco and alcohol and axed a provincial bus company viewed by some as an essential service.
The budget reduced spending on education, slashed funding for libraries and cut money across the board for post-secondary institutions. Some 574 provincial workers lost their jobs. Saskatchewan forecasts a $685-million deficit with another two years of deficits to come.
Which fiscal course proves more successful will be seen down the road, but the budget in Saskatchewan is a sobering reminder that the grass isn’t always greener next door.