A year after winning the provincial election with a series of spending promises, Alberta Premier Alison Redford has unveiled a budget that includes a range of cuts and backtracks on the pledges that helped bring her to power.
Reaction was swift – and overwhelmingly negative.
In the 2013-14 budget released on Thursday, the books won’t be balanced this year. Heaps of new debt will be taken on for infrastructure projects. Funding for full-day kindergarten is off the agenda. A big-spending plan to clean up Alberta’s energy sector is on ice. Teachers, health-care workers and public-sector employees are being told to brace for wage freezes and cuts.
Opposition Leader Danielle Smith slammed the Tories and Ms. Redford for ditching their vote-grabbing promises.
“It is quite clear to me that they don’t want to live up to the commitments they made to Albertans, and she doesn’t want to live up to the commitments that she made during the election,” Ms. Smith told reporters.
Finance Minister Doug Horner expected to take heat, and would not apologize for it.
“I’m not in this for my political gain,” he said. “I’m in this to do the right thing.”
Mr. Horner has halted spending despite a 4.3-per-cent growth projection for population plus inflation amid falling energy royalties. Operational spending is being kept at $36.4-billion, which, give or take a few hundred million dollars, is the same as in 2012-13. Almost as many departments received small cuts as received tiny increases to their budgets.
That’s a switch from a decade of average spending hikes of 7.3 per cent, which prompted fiscal hawks to decry the Tories as freewheeling.
But facing a deficit of $1.975-billion this fiscal year – a broken campaign promise – the Tories were looking for all the cost savings they could find and the trickle-down was instant.
Education was hit particularly hard, with overall funding set at $8.9-billion, a cut of $120-million this year. The budget also includes a 3.6-per-cent slide in post-secondary funding.
Jonathan Teghtmeyer, a spokesman for the Alberta Teachers’ Association, said 350 to 400 teachers would lose their jobs and 11,000 new students would head to class this fall without the appropriate funding to support them as a direct result of this budget.
“This is a big blow to education,” he said.
The $200-million in full-day kindergarten funding that the Tories promised within one year of forming government has been scrapped. Meanwhile, Ms. Redford’s $2.4-billion pledge a year ago to build 50 schools and renovate 70 more over four years has no date for completion – although the government says they are still going ahead.
The vow to build 140 family-care clinics by the next provincial election is moving forward, but the province has budgeted only $60-million over three years, and it’s not clear whether it’s enough or whether they will be completed on time.
Funding increases for health care will be cut to just 3 per cent after a decade of growing annually by 9 per cent. But it’s still the largest item in the budget – $17.1-billion, a hike of almost $500-million. Health care now eats up 45 per cent of operational spending, up from about one-third.
Also left in doubt is Ms. Redford’s $3-billion campaign pledge to bring back the Alberta Oil Sands Technology and Research Authority (AOSTRA), which former premier Peter Lougheed launched four decades ago to develop technology for both renewable and non-renewable energy and enhance the province’s environmental record. It was not included in the budget.
Jack Mintz, chair of the School of Public Policy at the University of Calgary, said the Tories are projecting that energy prices will rebound, while they drain savings and borrow close to $12-billion over three years.
“It’s not clear that there’s really a coherent fiscal plan for the province,” Prof. Mintz said.
The Tories, who garnered the support of civil servants, teachers and health care workers during the election, are now locked in contract disputes with them. The teachers and doctors are looking for wage hikes, and public-sector managers are facing wage freezes and 10-per-cent staff reductions over the next three years – cuts that Mr. Horner said could be further amplified as programs are slashed.
“There is no new money built into this budget for salaries,” he said.
With a report from Carrie Tait