A lot of the world's leaders would love to be sitting in Brad Wall's chair in the office of the Premier of Saskatchewan. Mr. Wall presides over a province with a strong growth outlook. vast oil, uranium and potash reserves, and a balanced budget - all of which bolster his reputation as a rising political star. But he also manages a province that sits in the eye of a commodities hurricane, with finances buffeted between unexpected windfalls and embarrassing shortfalls. It places huge strains, and expectations, on the Premier, whose conservative Saskatchewan Party assumed office in 2007 after 16 years of NDP governments.
You found a gaping hole in your potash revenue projections last year, and you will dip into savings to balance this year's budget. Are you living off your future?
I wouldn't say that. Last year was an anomaly. We didn't just see a reduction of potash revenues. We saw a complete collapse the likes of which has never ever, ever been seen.
This economy is very resource-dependent, as is the revenue cycle of government. That is not going to change, but the floor for many of those [commodity]prices has changed. We are the second-largest producer of oil in the country, and perhaps in the next year we will become the largest conventional producer. Even through the bash-your-teeth-in international recession we've just come through, oil touched $38 (U.S.) a barrel for just a heartbeat and stayed north of $50 through a train wreck of an economy internationally and came back very quickly.
What about potash, which collapsed last year from about $1,000 a tonne to the $300 area?
Potash is in our budget at $310, [the current price is about $340] but only three years ago that would have been a very high price. We're going to have to deal with the cycles - that's why we have cash in our savings account and we will have to replenish it. With recent land sales, we are well on our way to putting money back. We are going to budget very cautiously and we did so in this budget in terms of prices of potash, oil and land sales.
As long as you're exhausting savings, aren't you squandering the chance to be another Norway?
Norway's sovereign fund approach is something we've talked about for the long term. Our goal is that the savings account stays on average at half-a-billion dollars. There is also the general revenue fund debt [about $4.2-billion]that we want to pay off. Before we think about sovereign funds, I would want to eliminate that debt, and probably make a bit of an investment on the infrastructure side of our electrical utility. I believe the Norwegian approach is solid; we just have some work to do to get there.
It is hard for governments - I don't care how prescient - to fathom how quickly things can then turn around, and it is positive we lived through that. The lessons? We did pay $2-billion off our debt, but we probably would have done a bit more - and also kept a little more gunpowder dry on the savings account. As it turned out, we weathered the economic storm very well.
Where is the sustainable economy 40 years out?
There is an innovation agenda, and the three legs on that stool are agricultural biotech, uranium value-added opportunities and technology around the post-carbon economy. What's renewable is we have half the arable acres in the country. India is an important trading partner, and 44 per cent of India's trade with Canada is from our province. That's agriculture. So 40 years down the road is a debt-free province that has a sovereign fund, and where our innovation agenda is helping, and agriculture and trade are a big part of it.
Where does your controversial new construction labour legislation fit in?
We will have a competitive [construction labour]environment like every other province except Quebec. It is not particularly helpful to have any sort of monopoly environment when you have a labour shortage, a skilled trades shortage. There will not be one union any more. There is no more monopoly. The CLAC [Christian Labour Association of Canada]would be able to operate here, out of Alberta.
So much of economic development is about attitude and this is a new Saskatchewan. Look, we are a have-province now. Even before the last election, I spoke about Saskatchewan being able to lead the country. I would see people in the front row thinking, ' Yeah, we could do better than we're doing, but that's crazy. We're living next door to Alberta, that race car, and what about Ontario? " But here we are and we're leading. That attitude begets more of that attitude and it becomes a virtuous circle.
Why not a harmonized sales tax?
I'm not a member of the church of harmonization orthodoxy, at least as long as this jurisdiction has other tax modification priorities. Our corporate rate is too high; our small business thresholds are too high. We want to make progress on both of those. We have three tiers of [personal]income tax and we've said that a flatter system is important as we want to attract more entrepreneurial folks. We started with reforms in last year's budget to reduce the property-tax share of education funding. This is a capital tax, and frankly a capital tax is far more insidious for an economy than the lack of harmonization.
How do you respond to business leaders who say you are too timid in easing the weight of government, such as the province's Crown corporations?
We have a growth agenda for the province. We need to continue to get re-elected to continue to make these changes, maybe not as fast as people would like. But improving the economy's competitiveness is a process, not an event.
When we campaigned in 2007, we made some promises of things we would do and things we would not do. I take both of these very seriously. We're at over 100 promises we've kept, and we've worked hard not to do the things we said we wouldn't do. One of them was [not privatizing]the Crown corporations. We will keep that promise.
So you've got to keep getting elected and can't go faster than public opinion?
It's part of it. A government has to be measured in that respect. I work for the people of Saskatchewan and we as a government need to be mindful of that and honour the things we said we would do in a campaign. We said we would not harmonize sales tax and we would not privatize the Crowns. Politics will be over soon enough for me, and I want to get up in the morning and look in the mirror and realize I didn't say one thing and do another.
But why resist privatizing Crowns?
It's a practical lesson from the election of 2003 [which his party narrowly lost]when we sacrificed the chance to implement the rest of this growth agenda. I was the Crown corporation critic and I helped write the policy, so mea culpa. We sacrificed the chance to make some long-term changes in the psyche and environment in the province for this one issue.
Some on the right say SaskTel doesn't have a future as a standalone indie. Well, it just had its biggest year. Part of it is a growing economy and part of it is an attachment people have to their Crowns. In the case of SaskTel, it is competing with other telcos, and this [attachment]has stood them in good stead. I'm not saying Saskatchewan is an island with respect to government-owned enterprise, but there are unique elements that say to me: We still have other things to do, we made a commitment and we plan to keep it.
Would you like to be Canada's prime minister?
No sir, I have the best job in Canada right now. My wife is an engineer, she's been an entrepreneur and she's working in tax assessment with the city of Swift Current. She's given up a lot for me to do this political thing and I think it's coming up to her turn to do some stuff.
We'd like to see the growth agenda become more institutionalized, and our population to get to 1.1 million people. We are at 1.04 million right now. We haven't really grown since the 1920s, notwithstanding this biblical-proportion list of resources. For us to have this virtuous circle, we need people, we need taxpayers, we need activity. Population is a big deal for the province.
Title: Premier of Saskatchewan
Born: Nov. 24, 1965, in Swift Current, Sask.
Education: Honours degree in public administration, and advanced certificate in political studies, University of Saskatchewan.
Early career: Operated two small businesses.
1991 to 1999: Served as director of business development for city of Swift Current.
1999: Elected MLA for Swift Current and re-elected in 2003.
March, 2004: Became leader of opposition Saskatchewan Party.
2007: Led Saskatchewan Party to election victory and majority government.
This article has been corrected from an earlier version