FFWD REW

Alberta faces $6.9 billion deficit

Finance minister won’t ‘second-guess’ past government spending

After years of budget surplus after surplus — riches that enabled the Alberta Conservatives to literally give away money — the provincial government is facing a $6.9 billion deficit largely due to plummeting natural gas prices.

The deficit is $2.2 billion higher than the province predicted in its April budget a far cry from the days when the government sent $400 cheques to every Albertan. And while Finance Minister Iris Evans says “there’s no doubt” that the $1.4 billion the province gave away in that 2006 exercise would come in handy now she’s unapologetic about her government’s past spending decisions. “I’m not going to second-guess yesterday” she says.

But yesterday’s bad decisions created the current situation says University of Calgary economist Ron Kneebone. “Any of us running our households recognize that if our incomes are very volatile we don’t base our spending on our incomes when they’re high” he says. “Instead we base our spending patterns on when our incomes are low and we save during the good times…. It’s good risk management and it’s something the government has failed to do.”

The government plans to deal with the deficit by pulling $6.9 billion from its $17 billion Sustainability Fund and asking bureaucrats to trim $430 million from government spending.

Fast Forward Weekly called the NDP for comment on the deficit but a spokesperson said both party MLAs were on holidays and unavailable to media.

Tags: