Rapid growth and strong revenues bring bad habits, and Albertans should stay vigilant in slaying the debt dragon, warns Provincial Treasurer Steve West.
In a speech to the Calgary Chamber of Commerce on Friday, West noted that the fiscal priorities of the province must remain paying down the debt, reducing taxes, increasing one-time priority spending in sectors like health and education and putting away savings for the future — keeping in mind the cyclical nature of resource-based revenues.
“Right now, we’re in one of the most dangerous times that can happen to governments,” said West. “We’ve got increased revenues, over and above our three-year budget plan.”
West also took aim at critics of his government who insist that deep cuts to health care, education and other areas weren’t necessary to bring down the debt. “That’s heresy,” he claimed, adding the budget wouldn’t be balanced and the province would still be burdened by a heavy deficit even with $8.5 billion in increased revenue.
The economy won’t be strengthened by penalizing the rich with even more onerous taxes, West said.
“Let’s not forget the principles that built this country. Pure socialism doesn’t work, folks,” he said. “It sets too many people on the sidelines, creates apathy and no self reliance or individual resolve. It’s a nice thought, but it doesn’t work.”
Alberta’s new tax plan sets a single rate of tax at 10.5 per cent starting January 1, with an increase of personal and spousal exemptions to $12,900. West says the government has set its sights on removing 190,000 people from provincial tax rolls while creating 30,000 new jobs within five years.
Total tax cuts in Alberta, says West, now amount to $3 billion since 1994. “We’re lowering taxes for the right reasons, to increase our GDP, to leave more disposable income in peoples’ hands, and to keep employment growing,” he declared.
Meanwhile, West reassured the business community that while the bugs will be worked out of the process of electricity deregulation, a new attitude is also needed. “We better get ready to change our lives and how we use energy,” he said, adding it’s an unusual period because oil, gas, electricity and energy consumption are hitting highs at the same time.
An estimated $500 million from the upcoming sale of 2,140 megawatts of power – left over after the first auction of power last August — will also be returned to Albertans, although West didn’t say when this would happen.
“That’s your money. It will come back to you on your power bills,” he said.
