Lobby group highlights provincial debt
Province: Taxpayers group says provincial debt has grown from nothing to $7.7 billion
Friday, Jan 17, 2014 11:18 am
Once declared paid in full, a lobby group said Alberta’s debt has hit $7.7 billion and is rising at a rate of $11 million per day.
The Canadian Taxpayers Federation has launched an Alberta version of its debt clock online at Albertadebtclock.ca, counting up what it says is an increasing amount of red ink for the provincial government.
It’s a marked contrast to when former premier Ralph Klein pronounced the provincial debt paid in full in 2004.
Derek Fildebrandt, Canadian Taxpayers Federation Alberta director, said it shouldn’t be any problem for the Alberta government to balance its books and stay out of debt.
“It’s unethical to run up debt and pass it on to your children, especially when you’re in a place as easy to balance the budget as Alberta,” he said. “This should be the easiest place on the face of the North American continent to balance a budget. There’s absolutely no reason for debt here.”
The organization will also create a physical version of the debt clock it plans to tour around the province. Fildebrandt said they will bring it to Okotoks at the end of winter or early spring.
He said the group used provincial data in its calculation.
The group maintains a clock counting the federal debt and the debt for every other province. Fildebrandt said they never had a debt clock for Alberta because they didn’t believe they’d ever need one.
However, he said the provincial government hasn’t been able to control its spending and this has resulted in sending the province back into the red.
Jessica Jacobs-Mino, spokesperson for Alberta’s finance minister, countered the CTF’s criticism.
For one thing, she said the debt clock is not an accurate representation of how the Provincial debt is accumulated. Jacobs-Mino said the group also isn’t recognizing Alberta’s strong financial position in comparison to other provinces.
“I don’t think they’re consistent of their criticism of government across the country because there’s no recognition for the fact that on an operating basis we’re doing really well here and we have the strongest balance sheet in the country,” she said.
Jacobs-Mino said the Province has been open with Albertans about borrowing money to meet the demands of a growing province
“We’ve been in consultation with Albertans, we were told to continue to invest in infrastructure, we’ve held the line on our operating spending and we’ve divided out our budget so people can understand where the money’s being spent,” she said.
Jacobs-Mino said putting off infrastructure projects will only make it more expensive to build them in the future.
As well, she said it’s a good time to borrow money with record low interest rates.
Unlike debt accumulated before former premier Ralph Klein took office, which built up over years of operating deficits, she said the provincial government is not borrowing money to cover operating expenses today.
The provincial government has only borrowed to pay for capital projects, she said.
“We’re not borrowing to pay off our credit card bills, we’re borrowing to build the infrastructure that a growing province needs,” she said.
The opposition Wildrose Party has been decrying the provincial government for once against putting Alberta in debt.
The party’s finance critic said the government has an obligation not to leave it to future generations to pay this generation’s bills.
“We can pay our own bill, we don’t need our kids to pay those bills for us,” said Airdrie MLA Rob Anderson.
He said the Alberta debt will be upwards of $8 billion by the end of the year. By 2016, he said the provincial debt will be more than $17 billion.
“Its an extraordinary amount going from essentially zero in 2008 to roughly three and a half million dollars or so when Premier (Alison) Redford took over to $17 million within a term,” said Anderson.
He said there’s no reason for Alberta to have gone back into debt with the high price of oil and gas.
“It’s just baffling to people that we would be running such a significant deficit and having to borrow too much money when we have so much prosperity in our province,” said Anderson. “It shows just a complete lack of fiscal competence.”
He said the danger with debt and borrowing money is when it spirals out of control.
Anderson said interest that is paid to service the debt is money that could be going to health care, education and other government priorities.