Low royalty rates behind Alberta's deficit, says union

The Alberta Federation of Labour released internal budget documents that show the province has one of the lowest royalty rates in North America, which it's blaming for the provincial deficit.

Albertans suffering from government's poor decisions, says Alberta Federation of Labour president

The Alberta Federation of Labour says that the province's low royalty rates are hurting Albertans. (Vahid Salemi/Associated Press)

The Alberta Federation of Labour (AFL) painted a bleak picture Friday of the province's financial situation.

The union says it has internal government documents showing the province has one of the lowest royalty rates in North America and consistently lags behind those collected by U.S. states.

AFL says while Alberta garnered 38.97 per cent of industry profits for conventional oil in 2011, Louisiana collected 64 per cent and New Mexico 58 per cent.

Union president Gil McGowan says that's the reason the government is being forced to make staff cuts in key areas.

"We're going to continue to face this perverse situation of being the wealthiest province in Canada that spends in the middle of the pack in public service but still racks up debt," McGowan says.

"The reason we can't afford our public services is not that we're not wealthy enough, it's because our provincial government continues to refuse to get a fair share."

The union's criticism come three days after it released a commercial poking fun at Alberta's low royalty rates.

The video features a Transylvanian billionaire smugly thanking the province for helping him get rich.

"Thousands of jobs are being eliminated at universities, colleges and technical institutes across the province, programs are being closed," McGowan says.

"At the same time, a de facto hiring freeze has been imposed on our health-care system and our education system. Our public services are becoming increasingly disconnected from the prosperity that's all around them."

McGowan also says Albertans are now suffering as a result of the province's poor choices.