Everything is rosy in Alberta, if you are to believe the provincial government.
The economy is growing faster than predicted and is forecasted to grow four per cent in the next fiscal year.
In Tuesday’s quarterly fiscal update, Finance Minister Joe Ceci said the recession is behind us and we can expect the recovery to continue.
“Alberta is back in the saddle,” Ceci proclaimed.
But things are not nearly as rosy as Ceci would have us believe.
On Wednesday, the province’s credit rating was downgraded yet again, this time by DBRS. In a statement, the credit rating agency noted Alberta “has yet to demonstrate any real willingness to address the weakest budget outlook among all provinces, despite high levels of per capita spending and the lowest tax burden in the country.”
DBRS also noted the province seems to be waiting for another resource boom to solve its fiscal issues. With the price of crude currently below $60 a barrel, that’s not likely any time soon.
The Alberta economy might be improving but it’s not enough to warrant the uncontrollable spending. On Tuesday, Ceci announced a public-sector hiring freeze but that will only amount to a drop in the bucket when it comes to government spending – not nearly enough to offset the massive deficits.
Unemployment is still around eight per cent in Alberta, much worse than the 5.8 per cent rate when the NDP took power in May 2015.
Many businesses are also feeling the pinch after continued rises in minimum wage, as was discussed at a recent roundtable discussion with Alberta Chambers of Commerce President and CEO Ken Kobly.
“This is one of the largest issues that we have dealt with in the 13 years I have been with the Alberta Chambers,” Kobly said.
Add in the carbon tax and the proposed changes to federal taxes and it is a tough time to do business in Alberta. We need business to create jobs and grow the economy, but the government is making it hard to do that.
Businesses are forced to reduce costs and make tough decisions, but the government won’t do the same. The NDP government continues to drive our province deeper in debt, including borrowing for operating costs. No business would be able to operate this way. Credit rating agencies can see Alberta has out-of-control spending and they will continue to downgrade the province’s rating unless that spending gets reined in. But that isn’t going to happen under Notley.
Barring another oil boom, there is no chance this government is going to come close to balancing a budget any time soon. The only thing the Notley government has been successful in creating is more debt for future generations. The economy may be in recovery now, but it will be years before Alberta will be able to recover from the overspending of the Notley government.