Provincial government seeks feedback on Budget 2015

“For every one-dollar drop in the price per barrel of oil in one year, the province faces $215 million less in revenue. “ Rod Fox, MLA

Albertans have an opportunity to provide input into Budget 2015.

With the provincial government facing a potential $7 billion drop in revenues due to low oil prices, Lacombe-Ponoka MLA Rod Fox says taxpayers can have a voice in how they feel the budget should be arranged.

He took some time to enlighten members of the Ponoka and District Chamber of Commerce, Tuesday, Feb. 17 during a lunch meeting, about what the province is working on with Budget 2015. “Albertans should expect a no-frills budget,” said Fox.

He says people deserve to know the facts with regard to some of the challenges the province faces. Despite large growth in population, oil prices are declining at a rate that is sure to effect government spending.

“The problem that we’re confronted with right now is that the province relies heavily on volatile energy resource revenues,” said Fox.

Looking at pipelines to ease the burden

It is clear the province needs to move to a more sustainable plan, said Fox, but he did not say how that would look. Rather than discuss alternative energies or renewable resources, the question of four major pipelines came up.

There are four proposed pipelines that Premier Jim Prentice is looking into: Keystone XL, Gateway, Trans Mountain and Energy East.

Fox says the government is looking at ways to get these pipelines operational, even through Alaska for the Keystone XL pipeline.

Focusing on these pipelines appears to be something the provincial government feels will get Albertans out of this economic instability. Fox says for every dollar drop in the price per barrel of oil in one year, the province faces $215 million less in revenue.

“Imagine if your salary was slashed by that much,” said Fox in reference to the 50 per cent decline in the price of oil.

Compared to Norway, with a 25 per cent sales tax and a 48 per cent income tax rate, Fox said Alberta has no sales tax.

Health premiums and sales taxes were mentioned during the discussion, but Fox feels Albertans are not eager to see a sales tax.

“We need to look at efficiency, costs and productivity in our government,” said Fox.

The province is also looking at market access for other revenue sources such as agricultural products, forestry and energy.

Reducing government waste

A plan is being put into place to reduce internal government expenditures such as only hiring critical frontline workers, limiting travel and training expenses and cutting down on spending on goods and services.

“Payroll and staffing are the biggest costs in Alberta right now. Alberta has the lowest taxes in Canada and our public services also cost the most,” explained Fox.

There are plans to look at the $5 billion contingency account to help transition into less spending in the near future. He feels the biggest challenge the province faces is meeting growth needs, but not reducing spending by $7 billion. “The result would be a crushing recession.”

Borrowing for capital projects

“Albertans have learned the hard way that when you defer investment in public infrastructure, it can take you decades to catch back up. This government won’t make that same mistake again,” stated Fox.

Much of Fox’s speech tried to impress upon listeners the need for financial restraint as well as infrastructure development to meet the large influx of people expected to move to Alberta every year, an estimated 100,000 people.

“That’s bringing 15,000 children into our province annually,” said Fox.

He suggests the province will borrow to finance large capital projects that will service a growing population.

It’s not all doom and gloom; Fox says the province has no net debt and more assets than liabilities and Alberta has weathered these market challenges before. “We will rebound.”

Renewable energy and health premiums

The question of investing in renewable energy did come up from one participant in the discussion, but Fox could not give any definitive answers on what that plan would look like except to say this budget has a 10-year vision.

The question of raising health premiums came up as well but Fox said he feels it would cost too much to set up a system that would be viable.

Information on Budget 2015 and a survey can be found on the Alberta Government Budget information website at

Survey questions focus on potential cuts to infrastructure, school and health care spending. There is also an opportunity to offer personal thoughts.