Alberta Budget Unveils $1.3-Billion in Cuts, Elimination of 2,100 Public Sector Jobs by Justin Giovannetti October 24, 2019 – the Globe and Mail
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Alberta budget unveils $1.3-billion in cuts, elimination of 2,100 public sector jobs By Justin Giovannetti October 24, 2019 – The Globe and Mail Alberta’s United Conservative government has property taxes due to empty office towers. A unveiled a budget even tougher than the one it slew of tax credits for investors, digital startups campaigned on, replacing a promised spending and small breweries will also fall victim to cuts. freeze with significant cuts to the public service and warnings of deeper austerity if new pipelines aren’t built. Premier Jason Kenney’s first budget outlines $1.3-billion in cuts and the elimination of more than 2,000 public-sector jobs as a necessary step to balancing the books in four years. The new austerity promises to inflame tensions with public unions and mayors in a province where years of economic stagnation has already caused rounds of layoffs and shrinking municipal budgets. The province will also press ahead with a plan Alberta’s Finance Minister warned Thursday to reduce corporate taxes by a third over the that “boom times” are not coming back to the next four years, as Mr. Kenney looks to ignite province any time soon. a recovery in Alberta after five years of economic malaise. The budget is Alberta’s toughest in terms of spending cuts in 25 years. Provincial The budget reaches balance just before Mr. governments have rarely cut their overall Kenney faces re-election in 2023 thanks to spending in recent decades, typically exercising steadily increasing oil prices, growing bitumen restraint by holding back the growth rate in royalties and the completion of three major spending. Alberta has not reined in its spending pipeline expansions by 2024. in a quarter century. Mr. Kenney’s proposed If any of those fail to happen, Finance Minister budget is almost unmatched in its ambition, Travis Toews says he’s ready to cut further. promising to cut its operating spending “This is not a boom-times scenario, this is very annually for four years, resulting in a 2.8-per- cautious,” he told reporters on Thursday before cent cut over the coming years. The province tabling the budget in the legislature in says it can eliminate the province’s $8.7-billion Edmonton. “This is a budget that actually deficit by 2022-2023. reduces operating spending. … It’s been To get there, the government will trim 2,100 decades in this province since we’ve seen a public-sector positions – a 7.7-per-cent budget reduce operating spending.” reduction – while reducing spending in some The budget expects operating expenses to fall areas and keeping budgets for health, education to $48.2-billion this year, down only slightly and social services frozen for four years. Grants from the spending document tabled last year by to municipalities will be cut by up to 50 per Mr. Kenney’s predecessor, NDP premier cent, worsening budget pressures in cities such Rachel Notley. as Calgary still grappling with a collapse in 2 The Kenney government’s plan will result in Guy Smith, the president of the Alberta Union the province facing similar debt levels to Ms. of Provincial Employees, said tens of Notley’s plan in government, with debt thousands of public employees are ready for reaching $93-billion in 2023 rather than $97- difficult negotiations over the next four years. billion. “If what Jason Kenney and his government want is a war with public-sector workers, it’s a war he’s going to get,” he said. Anticipating a challenge from union leaders, Mr. Kenney said in a televised address to the province the night before the budget was tabled that protest would not alter his government’s plans. “We are determined to deliver on that commitment to protect Alberta’s finances, come what may. No number of protests or political attacks will push us off course,” he said. New Democrat Sarah Hoffman, who was Ms. A plan by Ms. Notley’s government to Notley’s deputy premier, said that along with purchase rail cars and transport oil to customers higher user fees on everything from car in the United States will be shelved at a cost of registration to museum visits, the budget hikes $1.5-billion. Mr. Toews said he expects the income taxes by ending the indexing of tax private sector will ship increasing amounts of brackets to inflation. oil by train as production ramps up in the “He definitely didn’t campaign on increasing coming years. The province expects the personal income taxes and that’s one of the first completion of the replacement of the Line 3 things he did. We’ve had indexed income tax pipeline, as well as the expanded Trans since 2001 and now that’s gone,” Ms. Hoffman Mountain and Keystone XL pipelines, will said. eventually reduce the need for oil by rail. The budget contains no leeway for wage The province’s plan to build infrastructure will increases in the public service, a decision be reduced from $7-billion annually to about expected to lead to a showdown with the $6.2-billion. The reduction means cancellations province’s unions. The spending document or delays to a number of large projects, warns that more layoffs will be required if the including a new hospital in Edmonton. government is ordered to increase worker Provincial funding for new transit projects in remuneration due to continuing labour Edmonton and Calgary will be spread out over arbitration. a longer time period. .