Are you fed up with "roller-coaster" budgeting

According to the Finance Ministry, Alberta government spending on programs (converted to 2001 dollars) went from $8,450 per person (1986) down to $5,212 (1996) and back up to $6,935 this year. This "roller-coaster" budgeting is bad for several reasons.

First, roller-coaster budgeting makes long-term planning difficult. The absence of steady, reliable funding can lead to unwise spending decisions in all departments.

Second, spending cuts create anxiety for many Albertans, while spending increases make taxpayers nervous because they fear losing hard-won tax cuts. Surely there are better ways to make life more exciting.

Third, when governments cut spending, infrastructure is usually first on the chopping block. This doesn't cause protestors to storm the Legislature, but cuts to infrastructure actually cost taxpayers a lot more money in the long run. When necessary road maintenance and bridge repairs are neglected, problems can become extremely expensive to fix later on. A predictable level of infrastructure funding, both for new construction and for repairs and maintenance, is in the best interest of taxpayers.

A spending control law would put an end to roller-coaster budgeting in Alberta.

Since 1995, the Revised Code of the state of Washington has imposed a limit on government spending. This law indexes the growth in government spending to a "fiscal growth factor" based on inflation and population growth. The fiscal growth factor also applies to fees and licences, unless the Legislature specifically votes for a larger increase. Put simply, if inflation runs at 2.5% and the population grows by 2.4%, government spending can increase no more than 5%.

The state expenditure limit may be exceeded in case of emergency, but only with the approval of two thirds of the Legislature. An "emergency" is limited to natural disasters that require immediate government action to alleviate human suffering and provide humanitarian assistance. Any additional taxes imposed to deal with the emergency stay in place only until thirty days after the next general election, unless voters approve of extending the tax increase at that general election.

If Alberta adopted a spending control law, there would be adequate, stable and reliable funding for infrastructure - both for new construction and for necessary repairs and maintenance. Alberta's trend towards bigger and bigger government would be arrested. The government would be forced to prioritize spending rather than increase spending. Like Alberta's balanced budget and debt repayment laws, a spending control law would empower politicians to resist demands for more spending. A spending control law would stimulate debate on real reform to health care, by bringing an end to annual health spending increases which far exceed inflation and population growth. It would protect Alberta taxpayers by forcing politicians to set priorities, and cut spending in areas of lower priority.

Finance Minister Pat Nelson, and others, have credited Alberta's fiscal success to the fact that Alberta has legislation requiring the budget to be balanced, and legislation requiring 75% of a surplus to go to debt repayment. It's time to add a new chapter to this successful legacy of good fiscal laws, and bring in spending control legislation.