There are few things that Little Bow MLA Dave Schneider actually liked about the Alberta Budget for 2016.
He liked that they reduced the small business tax by one per cent. Municipalities are still receiving Municipal Sustainability Initiative funds from the province, even if $50 million was cut from funding, and the bridges and roads budget remains the same. Linear Funding from the province to Municipal Districts and Counties hasn’t been affected, along with family support services. Schooling options remain the parent’s choice, and there is an agriculture exemption for the increased tax on of fuel.
But besides that, Schneider has few kind words for it.
“After that, it gets kind of hard to find anything I liked. This is the first real budget,” said Schneider, saying the October budget was a copy of the budget the PC’s were going to introduce before the election took place. “It’s making things worse for this province. It’s kind of punishing families and businesses, and really because of the risky ideological policies that are being put forward.”
The Alberta NDP provincial government had released their 2016-17 budget earlier this month, with a deficit of $10.4 billion. This comes after an announcement made by Finance Minister Joe Ceci earlier this year, that in addition to spending more than projected in the October budget, they were going to have to spend more then they originally thought in the coming budget.
“Wildrose is incredibly disappointed to see this risky and ideological NDP budget. It shows no plan to get Alberta back to a path of fiscal sustainability, and accepts ballooning debts and deficits as acceptable,” said Schneider.
“From higher costs for driving your car or heating your home because of the carbon tax, to interest payments paid by typical Albertans because of the NDP government’s risky borrowing, this budget is reckless.”
Schneider has been a harsh critic of the carbon tax, which he says will make it more expensive to live in Alberta. Despite a carbon rebate, which was designed to cover increased gas and fuel costs and will be implemented next year, Alberta families will still face increased costs. According to Schneider, if you are one of the families who will receive a maximum rebate in 2018, you will have an additional $700 in expenses, due to an increased cost of living.
“Right from heating your house to buying groceries, driving your kids to the hockey game or basketball game, it’s all going to cost more,” he warned. “The typical family will likely see about a $1,000 a year increase in expenses, once the tax is fully implemented.”
“It just touches everything. Anything that is moved by rail or truck, et cetera, can’t help but cost more to purchase.”
However, one piece of good news for agriculture producers is that, as far as fuel goes, the Ag sector is exempt from the tax. There was also some savings when a collection of agriculture agencies, boards and commissions were dissolved or consolidated.
For example, the land compensation board and the surface rights board were consolidated with the municipal government board and the home buyer protection board, since they all have functions relating to land rights and similar mandates. They will share information and administration, but still remain separate boards.
Additionally, boards such as the agriculture development committee – which hasn’t met for over a year – and agricultural practices act board – which set manure management standards for producers – were dissolved.
“These cuts to agriculture boards, agencies and commissions add up,” said Schneider, saying that total board cuts across all sectors equaled about $33 million. “But if those boards reached their mandate, then it may make sense to roll them into other boards or to dissolve them.”
But one problem for agriculture is that the Strategic Transportation Infrastructure Program will not be funded in this year’s budget, although it will be a line item. The program provides funding to municipalities for bridge maintenance and construction, which will be a problem for his riding.
“If those bridges aren’t usable, moving agricultural products – whether it be livestock or grain – doesn’t matter what, it becomes very difficult. It takes more miles to accomplish the same thing, and at the end of the day that’s what farmers are striving for; is efficiency and how to get things done,” said Schneider, adding that the NDP does plan on funding the program in future years.
The NDP government has also project a total debt of $58 billion by the time the next election rolls around in 2019. While the actual number could go up or down, that is what they are forecasting, and are they are now predicting that the budget will be balanced by 2024 – four years after a previous promise of a balanced budget by 2020.
“The NDP says the budget can be balanced by 2024. So, a child born today will blow out birthday candles on their eighth birthday cake, before the NDP says that Alberta can ever expect to see a budget that’s balanced.”
Since the budget was announced, two more debt credit agencies downgraded Alberta’s credit rating. In December, Standard and Poor’s downgraded from ‘AAA’ to ‘AA+’, and since the budget was announced, DBRS downgraded it to a ‘AA’ rating and this week, Moody’s Investors Service downgraded Alberta’s credit to a ‘AA1’. While still in good standing, they are not the pristine ‘AAA’ rating the province has enjoyed.
“In reality, there was no attention paid, no desire from the government to tackle spending. Income has never been the big problem for Alberta; it’s always been spending,” said Schneider. “And yes, resource royalty revenues are down, and there’s no question that things need to grind a little bit slower down, while resource revenues begin the climb back up.
“There will be a two billion dollar payment to the bond agency for, basically, on interest on loans to continue with this type of a budget. I don’t know anybody who can operate their own budget like that. Certainly, it may be important that infrastructure needs are met while people are looking for work, those things could be all true… A well thought out amount of debt for the province is what I hoped to see, and there where no cuts, to spending, that would be substantive enough to bring that deficit down.”