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Alberta - A blue-print for Canada

Author: Scott Hennig 2006/01/26
With the recent election of a Conservative minority government in Ottawa - the first Conservative government in twelve years - many Canadians are wondering what is in store.

Some people are looking at the Tory's campaign platform. Others are looking at their record in opposition. Still others, have turned their eye to the Alberta government.

Will an Alberta prime minister coupled with expected strong representation from Alberta in the cabinet take any lessons from their provincial cousins Well, only if they follow the lead of Premier Klein's early years, should taxpayers be heartened.

Immediately upon taking office, Premier Klein reduced the size of cabinet from 27 to 18. He followed it up by introducing the Deficit Elimination Act, which forced the province to run balanced budgets by the end of his first elected term - a goal that took only a year to achieve. He next eliminated gold-plated MLA pensions (after a famous run-in with now government MP, but then-CTF director, Jason Kenney). All of this was achieved between his leadership win in 1992 and the 1993 provincial election.

After campaigning in 1993 on eliminating the deficit and paying down Alberta's $22.7 billion provincial debt through reductions in spending rather than increased taxes, Klein started making cuts. First was elimination of the premier's clothing allowance, followed by a 5% reduction in MLA pay. Next was a 5% reduction in public sector pay and 2,500 public sector job cuts.

Klein's next act was to "get out of the business of being in business", exemplified by privatization of the province's liquor industry. A move that has resulted in 2,700 new jobs created, a 250% increase in available products, a 269% increase in retail locations, and provincial government liquor revenues still increasing every year. This move has certainly shown that competitive industries are only constrained by government control.

This was followed up with the introduction of the Alberta Taxpayer Protection Act, requiring a referendum to be held prior to the introduction of a provincial sales tax. Also introduced was the Balanced Budget and Debt Retirement Act legislating an orderly pay down of Alberta's provincial debt. The Business Financial Assistance Limitation Act was also put in place, limiting the Alberta government from handing out huge grants or loan guarantees to private businesses.

Each of these initiatives was supported and pushed by the Canadian Taxpayers Federation.

Over the next few years, school boards and regional health authorities were amalgamated, Alberta adopted a single rate income tax, increased their basic personal exemption (head and shoulders above that of the federal government and any of the other provinces), and aggressively paid off its debt - well ahead of schedule.

Unfortunately things changed in the Alberta capitol. Today's PC government is not one that Mr. Harper should attempt to emulate. Canadians would not be well served by increasing spending by 113% over 10 years - a feat that has been largely achieved in just the past few years here in Alberta. Premier Klein's spending binge makes even the most spendthrift Liberal government in Ottawa look fiscally responsible by comparison.

Moreover, the Klein government raised taxes in 2002 - despite promising never to do so and has dragged its feet on health reform. Finally, Albertans are still waiting for business tax cuts promised in 2001.

Of course Harper is moderated by minority status in the House of Commons and a much more moderate platform than the one Premier Klein was first elected on. Nonetheless, Alberta's prosperity was not a fluke or an accident. Early policy initiatives of the Klein government set the stage for economic opportunity. Opportunity that the country as a whole would benefit from.

A Note for our Readers:

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Franco Terrazzano
Federal Director at
Canadian Taxpayers
Federation

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