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Labour Day Reality Check: Alberta should reduce labour costs to pre-NDP levels

Author: Franco Terrazzano 03/09/2020

CALGARY, AB: The Canadian Taxpayers Federation today released an analysis of Alberta’s increasing provincial government labour costs and the need to find savings, as the government deals with the largest deficit in its history and a $100-billion debt tab.

“We couldn’t even afford the high-cost government we had before the pandemic and we definitely can’t afford it now,” said Franco Terrazzano, the CTF’s Alberta Director. “Finance Minister Travis Toews doesn’t have a hope in balancing the budget and paying down the debt unless he takes some air out of Alberta’s ballooning government labour costs.”

Alberta’s first quarter fiscal update projected the government’s deficit to reach $24 billion this year, the largest in the province’s history. The Alberta government’s debt is expected to reach $100 billion by the end of the fiscal year.

The CTF is calling for the Alberta government to bring its labour costs back to 2014-15 levels, which is when the economic downturn began in Alberta and predates the labour costs increases that occurred under the New Democrats. This would result in savings of about $3.5 billion every year. The savings can be found through a few different ways, including attrition, pay cuts, job reductions or a combination of each, as illustrated in the CTF report.

The Alberta government’s labour costs have grown by nearly 15 per cent between 2014 and 2019, while compensation paid to all Alberta employees has declined by five per cent. If the Alberta government brought its labour costs in line with costs in other provinces, it would save billions of dollars every year.

“It’s not fair to keep asking struggling Albertans to pay for a bloated bureaucracy and inflated government salaries and benefits,” said Terrazzano. “Over the last five years many workers outside of government have lost their job or taken pay cuts and now it’s time for government employees to help shoulder the burden and take a cut.”

You can read the CTF’s 2020 Labour Day Reality Check report here.