NDP plans to put aside $100M a year
The provincial New Democrats have outlined a plan for putting resource revenues into a "Bright Futures Fund" that the party says will grow to $10 billion in 40 years.
The party is promising to create a fund similar to multibillion-dollar accounts that have been set up in Alaska and Norway. It made the initial announcement in September, but in its first official announcement of the campaign, has now unveiled details about how the Bright Futures Fund would work.
NDP leader Dwain Lingenfelter says he would pass legislation in his first year in office requiring the government to set aside $100 million a year in the account, which would be managed by independent business experts.
"We think with an $11-billion budget, finding $100 million won't be a big item," he said.
Lingenfelter says some of the money could come from increased potash revenues generated by another NDP promise to review — and likely raise — royalty rates on the commodity.
Currently, one of every five dollars the provincial government takes in comes from oil, gas, potash and other minerals.
Lingenfelter says the principal in the Bright Futures Fund would not be accessible for 20 years, and the province could only use the dividends after waiting 10 years.
As well, the account could only be used for capital costs and could not cover operating shortfalls.
The party says if $100 million is invested each year for 40 years and the fund generates annual returns of four per cent, it would grow to $10 billion by 2052.
The NDP says the fund differs from the province's Growth and Financial Security Fund, often referred to as its rainy day fund, because the money will be invested for the long-term instead of used for day-to-day spending.
The Saskatchewan Party says the fund is not a bad idea, but right now the province needs to focus on paying down debt and fixing things like roads and bridges.
The provincial Liberal Party leader, meanwhile, says the NDP stole the idea from him. Ryan Bater says the Liberals first proposed a sovereign wealth fund during his inaugural speech as leader in 2008. The creation of such a fund is also part of the Liberal Party's platform, which was announced Tuesday, although the Liberal plan involves paying down provincial debt first.