by Tristan Turner
Morinville – Alberta Finance Minister Doug Horner spoke to Rotarians, Councillors and guests at the Morinville Rotary Club’s regular Wednesday morning meeting Mar. 26. While the focus of attention in recent days has been former Premier Alison Redford’s resignation, Horner chose to focus his presentation on the provincial budget that is currently going through reviews one ministry at a time, and – according to Horner – is expected to be voted on by the legislative assembly in late April.
Minister Horner began his presentation by explaining the new format of the 2014 budget as compared with previous years; instead of operating under a single consolidated set of books, the new format splits the budget into separate pieces (like net assets, operational revenue and operational expenses) in a way that Horner hoped would make it clearer for Albertans to understand. “I want you to think about [this budget] in a different way,” Horner said. “I want you to think about this like your business and your home. Think about your income statement – your profit and loss statement – and your balance sheet, which is your net assets and your net worth. That’s the way bankers look at it… and that’s the same way municipalities, business and you operate in your own home.”
Horner also spoke to Alberta’s dramatic growth rate (in excess of 100,000 people last year), and how he believes it necessitates a “significant” infrastructure investment in highways and new schools. In order to finance these projects, Minister Horner told his audience he would be borrowing to fund infrastructure projects because “we currently have access to interest rates at near fifty-year lows”.
While Horner believes the budget has a surplus in excess of $1 billion Wildrose leader Danielle Smith has said the budget is not a balanced budget by any stretch because she takes issue with the more than $5 Billion the province will be borrowing to invest in capital infrastructure projects.
In a post-presentation interview Horner defended the borrowing. “We’re using public sector accounting principals and the fact of the matter is, these are assets that are on our books,” Horner explained. “Every jurisdiction does accounting the exact same way, and we’re not changing anything in our consolidated financials… the reality is that the federal government is borrowing over $95 Billion dollars this year, so is their deficit $2.9 [billion] or $98 billion dollars? I would argue that the Auditor General tells me I’m right, the public sector accounting group tells me I’m right, and Standard and Poor’s, the credit rating agency that looks at our balance sheets, they say that we’re right. If you’re talking about political critics, I would say that I would take the authority of the Auditor General, the credit rating agencies, the federal government and others over their [The Wildrose’s] criticisms.”
Before the Finance Minister left to discuss issues with local politicians, Horner commented on the recent resignation of former Premier Alison Redford, saying that he was both “surprised” and “saddened” by her resignation, but that now we “have to move on” as a province.