Instead of complaining about lack of money for roads, Calgary and Edmonton should count their blessings that oil and gas revenue helps pay for city infrastructure, education, health care and other services, Alberta Energy Minister Murray Smith says.
“We’re spending $19.2 billion (in the provincial budget) for over three million Albertans, which is pretty luxurious, I think, pretty fortunate,” Smith said.
“All you have to do is go to other provinces and see that we’re still very, very fortunate to have these oil and gas revenues,” he said last week at the University of Calgary.
Smith, who visited the university to help officially name an industrial research laboratory, was responding to questions about the government’s abrupt decision to restore the five-cent-per-litre fuel tax rebate to Calgary and Edmonton for one year. The cities depend on the rebate to fund new transportation infrastructure.
The province’s turnaround – coming a day after the rebate was removed – was not due to pressure from Calgary Mayor Dave Bronconnier and a potential lawsuit by the city for allegedly breaching the rebate agreement signed in 2000, Smith said.
“One of the reasons that we were able to make the decision for funding on infrastructure was the fact that oil and gas prices rose dramatically during the three-week cold spell in March,” he said. That pumps more money from oil and gas royalties into the provincial treasury.
The extra revenue enabled Alberta Transportation to postpone, until March 31, 2003, cutting the annual five-cent-per-litre tax rebate to just 1.2 cents per litre.
The turnaround means Calgary will be able to keep the $84 million it was advanced by the province for transportation infrastructure. However, the city still faces a $336-million shortfall over the next five years to complete projects such as the Elbow Drive-Glenmore Trail interchange and south leg of the LRT to 162nd Avenue.
Bronconnier and several Calgary aldermen angrily condemned the province’s initial decision to reduce the rebate. However, Smith noted that both levels of government “serve one taxpayer, one citizen. And I think we can do that together in a spirit of co-operation and harmony, as opposed to conflict and controversy.”
In addressing a separate issue, Smith flatly rejected the idea that Canada should ratify the Kyoto accord on climate change, aimed at reducing greenhouse gases blamed for global warming.
Signing on to Kyoto would amount to paying royalties on Alberta’s energy production to countries such as Russia, and would impose “a punitive cost to our province’s oil and gas industry,” he said.
Under Kyoto’s rules, Russia will have surplus emission-reduction credits to sell to nations that have higher emissions. That’s because Russia’s struggling industrial sectors produce far less emissions than the country is allowed under the climate change treaty.
“I don’t believe that the Kyoto Protocol can be ratified in its present form,” Smith said.
But environmentalist Martha Kostuch, of the Prairie Acid Rain Coalition, says it’s unfortunate that the Alberta government seems to be succeeding in its campaign to pressure Ottawa to delay or abandon Kyoto ratification.
“I think it’s a terrible shame and a global embarrassment. Canada has always been a leader in environment,” Kostuch said.
