by Stephen Dafoe
Premier Jason Kenney announced on Twitter Tuesday that the UCPs 2021-2022 provincial budget will be released Feb. 25. In his Tweet, Kenney said the budget will focus “on protecting the lives and livelihoods of Albertans.”
Finance Minister Travis Toewes announced last fall that the deficit would be $21.3 billion, $2.8 billion less than he had said earlier in the year. However, that reduction was still almost $7 billion larger than when the budget was tables in February of last year.
The Canadian Taxpayers Federation (CTF) followed Kenney’s social media announcement with a call to the UCP to balance the books, while not raising taxes.
“Taxpayers are looking for two things in the upcoming budget: a plan to balance the books and no tax hikes,” said CTF Alberta Director Franco Terrazzano in a media release Tuesday morning. “A pandemic and economic downturn is no time to be increasing taxes and that means Finance Minister Travis Toews needs to cancel his bracket creep income tax hike.”
Bracket creep, something Premier Kenney was opposed to as a federal politician, occurs when taxes are not tied to inflation and rising inflation pushes income into higher tax brackets as a result.
The CTF has criticized bracket creep in the past and are once again asking the UCP to end it.
The taxpayer watchdog organization is also suggesting budget targets and implementing financial penalties for MLAs if the targets are missed.
“There should be financial consequences for overspending and dragging taxpayers further into debt,” said Terrazzano. “If politicians can’t meet their budget targets that should be reflected in their pay.”
Fraser Institute Call For Klein methods
The conservative Fraser Institute study Lessons for Fiscal Reform from the Klein Era the Kenney government can “learn some key lessons from the Klein era of the 1990s.
“Successive governments in Alberta have repeated many of the mistakes of the pre-Klein era, including an overreliance on natural resource revenue and high levels of spending, which has produced deficits and rapid debt accumulation,” said Tegan Hill, Fraser Institute economist and the report’s co-author.
The report cites Alberta’s $43 billion in assets prior to the 2008/09 recession. Increased government spending since then, coupled with the impacts of the COVID recession and low oil prices, Alberta’s net government debt will hit roughly $63.5 billion in 2020/21.
“If the Kenney government is serious about eliminating the budget deficit without harmful tax hikes, it should bring spending levels in line with provincial revenues,” Hill said.
MLAs return to the Legislature for the Second Session of the 30th Legislature Feb. 25.