Surrounded by chairs in an empty room at Government House, Premier Jim Prentice took to the airwaves Tuesday night to speak directly to Albertans on what he considers an “essential” message — the financial crisis facing the province.
In measured sentences, he revealed a few hints at what Albertans can expect to see on budget day — the promise of a balanced budget by 2017 and, not surprisingly, no sales tax.
Prentice also hinted at a return to health-care premiums. Seven years ago premiums were scrapped by then-premier Ed Stelmach, who made getting rid of the fees a major part of his campaign.
“We will be asking Albertans to begin to contribute directly to the costs of the health system,” he said.
Calling this a “turning point” in the province's history, he warned that his government will be announcing “some critical changes” in the upcoming budget.
Exactly what those changes are, he didn’t say. Alberta Finance Minister Robin Campbell will deliver the budget on Thursday.
What he did say during his 16-minute address is that this upcoming budget will impact every Albertan, that spending must be brought under control and getting off the “energy revenue rollercoaster” is a must.
Prentice also laid out an incremental plan that will see fewer energy revenues spent on government programs. It begins in 2018-2019, when 75 per cent of energy revenues will be used on government spending. The following year, that drops to 50 per cent. A quarter of the oil and gas revenue will go to the province’s emergency fund and paying down debt.
The premier also promised more money for Alberta's savings fund. By 2019-2020, roughly 25 per cent of energy revenues will be put into the Heritage Fund, which started by former premier Peter Lougheed in 1976.
Previous budgets not 'realistic'
For months, Prentice has raised the alarm over plunging oil prices and the disastrous effect it has had and will continue to have on Alberta’s bottom line. The province is forecasting a $7-billion shortfall, and a further $20 billion over the next three years if oil remains low and the government does nothing to change how it spends and collects revenue.
Prentice reiterated his message to public sector employees reminding them Alberta spends about $1,300 more per capita on programs and services than the national average. About half of those costs are spent on salaries, with $2.6 billion in salary increases planned over the next three years.
During the speech, Prentice laid the blame on former leaders, calling past budgets “speculative” for relying too heavily on optimistic oil prices
“Fundamentally, we’ve not always had realistic expectations and our leaders must bear a considerable part of the responsibility for that,” he said.
Both Lougheed and Ralph Klein are given favourable nods — Lougheed for diversifying the economy and Klein for his “fiscal rigour.” However, Prentice goes on to say that successive leaders did not sustain their intentions.
“We became complacent,” he declared, punctuating in closing that he will do everything he can “to make things right, to make things better.”
Better health care, services needed: Swann
In a response that aired on CTV directly after Prentice’s address, Alberta Liberal Leader David Swann urged voters to look to an “alternative” to the premier.
Swann said at a time that Prentice was suggesting cuts to services and difficult choices, the province should not be forced into an “unnecessary” election “just to assert his power.”
“There is nothing to justify more cuts to frontline services and placing heavier burdens on the backs of hard working Albertans,” he said.
Instead, Swann said the government needed to improve Alberta’s health care system. He also argued for more funding for infrastructure and municipalities.
“Putting up a sign in a field and cutting a ribbon is only the first step,” he said.
In an anecdote, Swann compared to Albertans to his three-year-old grandson, grasping in the dark, wanting to know “that someone will be there for them as well."