Despite an unexpected windfall in resource revenue, Alberta’s government is on track to spend $7.8 billion ($7,800,000,000) more than it raises in revenue this year, according to the first quarter fiscal update.
“If nothing else, this update underscores the desperate need for immediate spending restraint,” said Independent MLA Drew Barnes. “With resource revenue coming in three times higher than predicted, a deficit of this size is simply unacceptable.”
Alberta’s total debt has surpassed $100 billion, with interest on this debt forecast at $2.1 billion.
The Finance Minister has indicated he will not offer a plan to balance the budget until the end of the pandemic, which he expects sometime in 2022.
Leaving government spending on autopilot until that time simply is not an option, said Barnes.
“The government of Alberta has a spending problem. The Finance Minister knows he has a spending problem. He freely admits it. There was a spending problem when this government took office, and that problem has only grown,” said Barnes.
“For years, Albertans have been spending more for basic services than residents of most other provinces in Canada, and we are not getting our money’s worth.
“Under Jason Kenney, total spending continues to increase, up another $800 million in this fiscal update.”
In addition, the government is ignoring one of the major issues facing Albertans: inflation. This year’s inflation rate is expected to be 2.9 per cent, almost three times higher than last year.
“Inflation takes money out of every single person’s pockets, substantially driving up the cost of living at the worst possible time for Albertans,” said Barnes. “This is one of the reasons the government used to increase income tax thresholds along with inflation.”
“However, two years ago this Finance Minister chose to de-index. As a direct result, the government of Alberta is poised to increase revenue through a back door tax increase worth hundreds of millions of dollars. It’s not right, and it’s something this government needs to address.”
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