‘Still very early:’ Alberta economy improving, but no change to $10.8B deficit

Alberta economy better but no deficit change

EDMONTON — A rebounding oil sector is delivering an extra $1.5 million to the Alberta government this year, but Finance Minister Joe Ceci says that money â€” and more — has already been spent and the deficit will remain at $10.8 billion.

Critics say no matter whether times are good or bad Premier Rachel Notley’s government lacks the will and the fibre to make hard decisions needed to balance the books.

“We’re still very early in the recovery phase. Alberta families are worried about the basics and the government is focused on basics,” Ceci said Thursday as he released the third-quarter update for 2016-17.

“We’re here to make life better for Alberta families.”

The update shows Alberta is on track to take in $42.9 billion this fiscal year, which ends March 31. But $1.5 million in gains are offset by an extra $2.6 billion in spending.

The province, at the suggestion of the auditor general, is booking a $1.1-billion accounting expense now for payments to be made to operators over the next 14 years to move the electrical industry off coal-fired power by 2030.

The province is also spending $774 million more than planned to cover higher operating costs, mainly in health, education and social services. There is another $818 million for disaster assistance needed after severe flooding in 2013 and last spring’s Fort McMurray wildfire.

To keep the deficit from ballooning to $11.5 billion, the province is throwing in a $700-million cushion it had kept to guard against low oil prices.

Ceci said the province is still committed to reducing the deficit and debt and decreasing the cost of government.

“We’re looking at all areas to reduce expenditures and in the (2017-18) budget coming up next month we’ll even have more of those identified,” he said.

Government borrowing, including money to pay operating and capital costs, is expected to reach $32.3 billion against $19.7 billion in the Heritage Savings Trust Fund.

Debt servicing costs this year are pegged at just over $1 billion.

Ric McIver, interim leader of the Progressive Conservatives, said the government does not have the will to rein in spending.

“They can’t make the tough decisions that Albertans need them to make,” he said. “They can’t differentiate between what Alberta needs and what they would like to offer up to get them re-elected (in 2019).”

Wildrose critic Glenn van Dijken said Alberta’s debt will reach $56 billion by the end of the decade.

“Finance minister Ceci refuses to admit that the size of our government is a problem,” said van Dijken. “The government will continue to run massive deficits and pile up debt, which will eventually drain billions away from hospitals and schools.”

Economic indicators presented by Ceci suggest Alberta is out of a recession caused by a trough in oil and gas prices that gutted thousands of jobs. Higher oil and manufacturing exports are expected to propel growth by 2.4 per cent in 2017.

Provincial exports hit $8 billion last December, 47 per cent above the low point in April 2016.

Further economic good news arrived Thursday from the Conference Board of Canada. The think tank reported that Alberta is expected to have the strongest economic growth in the country this year due mainly to a resurgence in the oil sector.

The province reported 199 rigs drilling in January, the highest level in the last two years, and resource revenue has increased $1.1 million to $2.4 billion.

The oil price benchmark West Texas Intermediate was expected to average US$42 a barrel this year, but has since been revised to hover at US$48 a barrel. It is currently above US$54.

Dean Bennett, The Canadian Press

Just Posted

UPDATED: Dog found wandering in Langley headed to his Alberta family

The Langley Animal Protection Society and a kind truck driver are helping Frankie get home.

UPDATED: Byelection lawsuit cost Langley City $27,000

Last-place candidate Serena Oh failed to convince the Supreme Court to hear her case.

Michael Jackstien named Langley’s Good Citizen of the Year

The longtime volunteer organized the BC Summer Games and many other local events.

Province’s best young curlers compete in Langley

Langley Curling Centre is hosting the juniors from Dec. 18 to 23.

Langley’s Marley and Cratchit bring spirit of giving to life

Local accountants will act as characters from A Christmas Carol for a fundraiser.

VIDEO: New series takes in-depth look at sexual harassment in B.C.

Black Press takes a hard look at sexual harassment in B.C.

Police appeal for info after girl, 11, hit in New Westminster crosswalk

Child was left with non-life threatening injuries

Horgan says pot smokers may face same outdoor rules as cigarette smokers

B.C. is developing its rules on recreational marijuana

B.C. teacher suspended after explicit images projected to class

Jeffrey Rohin Muthanna had been viewing porn on a school laptop for two years

Man who pledged to give B.C. hockey team millions charged with fraud

Mike Gould has since repaid $8,000 he allegedly owed Cranbrook restaurant, owner says

Strong economy fuels housing sales in B.C.: report

Economist says demand for houses is being supported by a large number of millennials entering the market

Tequila, hammers and knives: what not to bring on an airplane

Vancouver International Airport staff provide tips on travelling during the holidays

More than 20,000 pounds of garbage removed from riverside homeless camps

Two camps taken down last week on the banks of the Fraser and Chilliwack rivers

New fighter-jet competition to have national ‘economic interest’ requirement

Trudeau government wants to replace Canada’s aging CF-18s with 88 new fighters by as early as 2025

Most Read