Opposition accuses Alberta NDP of waiting for 'super-boom' to save ecomomy

The official Opposition hammered the Alberta government Wednesday during the first debate following the budget, accusing the premier of overspending billions while waiting for a magical "super-boom" to restore the economy and pay down mounting debts.

Wildrose Leader Brian Jean said the NDP budget released Tuesday contains "fantasy revenue projections" and no one in government can explain how they plan to bring in $55 billion in revenue in 2019. The government says it will balance the budget in the 2019-20 fiscal year.

Credit rating versus teachers' jobs

9 years ago

Duration 0:40

The Wildrose says the NDP budget puts Alberta's Triple-A credit rating at risk.

"In our best ever boom years, we never got anywhere near that number," Jean said. "When you look at the budget, it appears that this premier is clearly planning for a super-boom starting in 2018 and carrying through the election year."

Premier Rachel Notley said revenue estimates in the budget are "conservative," based on expert projections on the price of oil over the next few years.

But Jean pointed to a statement released by Moody's Investor Service, which labelled as "credit negative" the NDP plan to steeply increase the province's debt.

To fund capital investments and operating deficits, Alberta will incur direct debt of $6 billion in 2015-16, another $7.4 billion in 2016-17 plus $9.9 billion in 2017-18, Moody's said.

Moody's statement said it expects Alberta's debt burden to increase to around 60 per cent of revenues by 2016-17, from 30 per cent as of March 31, 2015, rising to around 80 per cent by 2017-18.

"This projected debt burden is high for an oil-dependent regional government, and surpasses Moody's previous expectations," the statement said.

"The budget's energy projections are even crazier," Jean said during question period. "Moody's says that the government may be over-projecting oil prices by as much as $20 a barrel."

The NDP budget delivered Tuesday is based on an average crude oil price of $50 per barrel for 2015-16, $61 per barrel the following year and $68 per barrel for 2017-18.

Moody's statement forecasts the price to average around $50 per barrel in 2015 and to fall slightly to $48 in 2016.

"Consequently, we see some risk that oil prices may remain low for longer than Alberta currently assumes, leading to a negative impact on budgeted fiscal outcomes over the next two to three years," Moody's said.

Focusing on that, Jean asked: "Is the premier not worried that the credit rating agency thinks she got the spending, the revenue and the borrowing in this budget all wrong?"

Notley countered that the alternative to borrowing money for capital projects and spending on government programs would be to cut teachers, nurses and services the public relies on.

During a massive drop in revenue, Albertans need their government to act as a "shock absorber," Notley said, a term she has used a number of times since her party took power in May.

"We have a boom-and-bust economy, we do not need a boom-and-bust government," Notley said. "The drop in the price of a barrel of oil should not be something that every teacher looks at every morning to find out if they have a job that day."

Alberta PST? Jeans asks, Notley answers

9 years ago

Duration 1:02

Opposition Leader Brian Jean grilled Premier Rachel Notley in question period Wednesday about how she plans to pay for all her budget promises.

Jean demanded Notley promise that her government will not bring in a provincial sales tax to pay for spending increases.

Notley said the budget was written around three pillars: to protect public services, to create jobs and to map out a plan to balance the books by 2019.

"That budget, nor any other budget in the term of this government, will not and does not include a PST," she said.