Premier Alison Redford is going to use a television broadcast to outline her government’s financial problems to Albertans.
The Premier’s Office says Ms. Redford will speak about the effect of rapidly falling resource revenues on Alberta’s long-term economic plan. Her eight-minute speech is to be broadcast on CTV stations Thursday night across the province.
Ms. Redford’s Progressive Conservative government is set to table its budget March 7, and the Finance Minister has warned it won’t be “fun.” The Premier has suggested Albertans will face a tough budget, but no tax or fee increases.
In a letter to party members, Ms. Redford said her government will continue spending money on key infrastructure projects.
“As Progressive Conservatives, you gave our government a clear mandate to keep investing in services that support our families and our communities,” Ms. Redford wrote in the letter released Wednesday.
“You told us to continue building the new roads, schools and health facilities we need. And we are listening.” She also said her government will hold the line on spending and live within its means.
Finance Minister Doug Horner said has said soft oil prices are costing the province about $75-million per day in revenue.
“This is not going to be a fun budget. This is going to be a budget that will show that we are serious about reining in spending,” Mr. Horner told a Calgary business audience on Monday.
In the medium term, he said, there’s still the opportunity to trim spending and work to make sure government services are being delivered in the most efficient way possible.
“And then you can probably have a discussion about whether or not we have the right mix of taxation to accomplish the job, but that’s a little ways out yet.”
Mr. Horner said there are serious structural issues with the province’s finances.
Alberta’s coffers are being hit hard by the steep discount oil-sands producers are getting for their crude versus other varieties. Alberta’s limited access to markets means its bitumen is fetching about $40 a barrel less than West Texas Intermediate, a benchmark for landlocked U.S. light crude.
The price gap widens to $50 when Alberta crude is compared to international benchmarks that can access the most lucrative markets by sea.
A number of pipeline proposals to the east, south and west are in the works to expand market access for Canadian crude, but that won’t fix the situation in the near term.
Mr. Horner says the province has been through tough times before, but this time it’s different.
“Alberta has long been well-positioned to weather economic storms. We came through the 2008 recession better than most other jurisdictions,” Mr. Horner said in his speech.
The provincial government held budget consultations in the fall with more than 6,000 Albertans.
In a report Monday, the province said Albertans want the government to save in good times and bad and to diversify the economy away from oil and gas. Respondents to the survey were also open to the government borrowing money to pay for infrastructure, so long as it’s in a responsible way.
Rob Anderson, finance critic of the opposition Wildrose party, said the survey is meant to justify the Progressive Conservative government’s “reckless fiscal agenda.”