Notley hints at larger deficit
CALGARY • Alberta Premier Rachel Notley delivered her first speech to this city’s business community Friday, offering a preview of her NDP government’s first budget, which is expected to include a large deficit.
In a speech to a crowd of about 1,600 at a Calgary Chamber of Commerce event, Notley said the previous government’s estimate of a $5 billion budget deficit in Alberta for the year was optimistic.
“Since that estimate, pressure has continued on oil prices, and therefore on provincial finances. That deficit may end up being higher,” she said.
Her government is set to introduce its budget, which is expected to include new spending, on Oct. 27.
“Capital as you know, these days is relatively inexpensive,” she said, adding “there is some capacity available in the construction industry.”
Alberta revenues have declined sharply in response to the collapse in oil prices. The province’s gross domestic product is expected to shrink by 0.6 per cent this year, from 4.4 per cent growth last year, Notley said.
Corey Hogan, director of engagement strategies with Hill and Knowlton, who attended the luncheon, described the business crowd reaction to Notley’s speech as “chilly.”
At one point, the crowd applauded after Notley said Alberta would continue to have the lowest tax rates in the country, but Hogan said, “even that was a bit reserved.”
“You would never know you were in a room of 1,600 people,” he said.
Following the speech, Notley and other senior members of the Alberta NDP went into a closed-door meeting with executives from Alberta’s oil patch, including from oilsands producers such as MEG Energy Corp.
Atco Ltd. president and CEO Nancy Southern introduced the premier, noting “her accessibility and her cabinet’s responsibility are a welcome change.”
She added that Notley, who has been criticized in the oilpatch for kicking off a royalty review in a time of collapsed oil prices, has shown “an unwavering commitment to our province’s economic future.”
“People are feeling engaged, but not necessarily heard,” Calgary Chamber of Commerce president Adam Legge said in a speech.
Notley also indicated she is reviewing what the Trans-Pacific Partnership means for Alberta’s economy.
“Certainly there is the potential for it to provide some benefits to some of our markets, but it has to be reviewed within the context of what the deal provides,” she said.
Alberta’s beef exports have been slapped with higher import taxes in multiple Asian countries following the discovery of a cow infected with bovine spongiform encephalopathy, or mad cow disease, in March.