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Premier Rachel Notley says the Alberta government will maintain public-sector services and not lay off workers despite a drop in revenue triggered by plunging resource revenues.

Notley gave some hints about the NDP's first provincial budget next month in a speech Thursday at the Alberta Urban Municipalities Association convention.

"We're going to stabilize public services and correct some mistakes the previous government made in managing finances like a $1.1- billion cut to health care and deep cuts to our schools and post-secondary institutions," she told delegates.

A budget was introduced, but never passed, by former premier Jim Prentice's Progressive Conservative before it was defeated by Notley and the NDP in May.

Finance Minister Joe Ceci has been touring the province to gather input for his budget. He has warned that challenges lie ahead as it will be the first full fiscal year with oil at drastically reduced prices.

Ceci has already said that Alberta is on track for a record $5.9-billion deficit this year as the oil crunch hits families and businesses.

"It makes no sense to respond to layoffs and job losses in the economy by making things worse by more layoffs and more job losses," Notley said.

"I would suggest this is a basic disagreement with both of the province's conservative parties. They continue to make their case, which is about immediately laying off thousands of public servants, including teachers and nurses."

The current economic situation actually means the time is right for a "significant reinvestment in infrastructure, the premier said.

"We are looking carefully for useful, well-thought-out, shovel-ready initiatives that make sense to greenlight this fall in the light of economic circumstances. Then there will be an additional sum we will be investing in our province's infrastructure over the course of a five-year capital plan."

Notley wouldn't discuss whether there will be any tax increases in the Oct. 26 budget, but did say she believes Albertans are willing to pay for health care and education.

She couldn't commit to balancing the Alberta budget by 2018 as promised during the provincial election campaign.

"I would like to take my platform ... and drop it down and say this is what we're going to do in the next four years. But things change, circumstances change, and we're grappling with that right now."

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