EDMONTON: The Canadian Taxpayers Federation (CTF) welcomed Premier Klein's announcement that responsibility for shaping 'a solid, positive plan for the future of the Heritage Savings Trust Fund' has been given to the newly appointed Minister of Revenue Greg Melchin.

"The Heritage Fund needs a clear and specific mandate, and should be removed from the control of politicians," stated CTF Alberta director John Carpay. "Nothing stops politicians from spending the Heritage Fund on pet projects under the old ruse of 'economic diversification' or money-losing 'regional development' schemes," added Carpay.

Last month the CTF released a commissioned study showing that Alberta can eliminate income tax, without introducing a sales tax, by building up the Heritage Fund. Once the Fund reaches about $55 billion, it will produce enough income each year to replace what the government now takes from Albertans in income tax. Alberta could be income tax free by 2015 or sooner.

"The Minister of Revenue can look to the example of Alaska, which has no sales tax and no income tax because it puts oil revenues into a Permanent Fund. Alberta should put a dedicated portion of oil and gas revenues into the Heritage Fund, to pave the way for income tax freedom in the future."

The Premier's announcement indicates that the government will revisit the mandate, goals and purpose of the $12.3 billion Heritage Fund.

Legislation governing the Heritage Fund was last changed in 1997. The Heritage Fund has no specific purpose or mandate. Its vague mission is "to provide prudent stewardship of savings from Alberta's non-renewable resources by providing the greatest financial returns for current and future generations." The CTF wants the Heritage Fund removed from political control, and managed as a trust, at arm's length from government.