Balancing Alberta's budget isn't enough, cuts are needed
Alberta’s two leading parties are promising to balance the budget, but neither are willing to roll back more than a decade of overspending.
The Canadian Taxpayers Federation launched an election-year promise tracker to add up all the of taxpayer-funded announcements made by the New Democratic Party and United Conservative Party.
Since the beginning of the year, the NDP has announced close to $14 billion worth of spending promises and the UCP found new ways of spending nearly $1.7 billion of taxpayers’ money.
These spending promises come after years of bloated government.
The Alberta government spends thousands of dollars more per person than Canada’s three largest provinces. The New Democrats’ operating spending grew faster than inflation plus population growth every year between 2015 and 2017. This followed a decade-long Progressive Conservative spending spree which doubled the province’s program expenses.
Given this context, balancing the budget by growing the economy and holding the line on spending levels — which the UCP proposes to do — doesn’t go far enough. All areas of government need to be eligible for significant cuts.
“Alberta spends $3.8 billion more than the average (per person spending) of Ontario, British Columbia and Quebec on health care,” wrote former Saskatchewan NDP finance minister Janice MacKinnon and University of Calgary economist Jack Mintz.
“Provinces like Ontario and British Columbia spend less on health care, even though their populations are older and less healthy, but they have better outcomes.”
With high spending failing to deliver superior performance, now is the perfect time to look for taxpayer savings and open-up the government health-care system.
The ballooning bureaucracy and government wages should also see cuts.
Since 2015, tens of thousands of government jobs have been added to the taxpayer dole. Not only do government employees at all levels of government in Alberta earn a 10 per cent wage premium compared to those working outside government, they also tend to retire earlier, are more likely to receive a defined-benefit pension, are less likely to be fired and lose more work hours for personal time.
Billions of dollars can be saved by ending taxpayer handouts to businesses. The next government should get rid of subsidies to rail car companies, the petrochemical sector, oil upgraders, renewable energy producers, tech and media production businesses.
Corporate welfare programs in the department of Economic Development and Trade should also be put on the chopping block. Albertans don’t need bureaucrats sitting around trying to think of which levers to pull for the economy or which businesses should win taxpayer-funded handouts. Albertans need government to cut red tape, scrap the carbon tax, and reduce business and personal income taxes.
It’s also time to rethink the role of government and get the province out of the activities it has no business being in.
With the Alberta Enterprise Corporation, taxpayers are forced to fund venture capitalists who then invest in companies. It’s time to cut the middleman and let taxpayers decide how they want to invest their own money.
Under Travel Alberta, taxpayers shell out nearly $50 million so the government can promote tourism. If these services are worthwhile, why can’t the tourism industry pay for them?
The government also needs to step away from its bank, ATB Financial.
“Why is Alberta, which is a province which understands privatization, still continuing to have a public enterprise in the banking sector?” said Jack Mintz. “It’s really something from the past.”
After more than a decade of bloated government, balancing the budget through holding the line on spending and growing the economy isn’t enough.
Albertans need politicians who are willing to make real cuts.