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Wednesday, 11 February 2015 15:57

Time for a new budget formula

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For the past decade the Alberta government has built budgets based on the price of a barrel of oil.

They’ve made out like bandits as oil skyrocketed to more than $100 a barrel and the revenue rolled into provincial coffers.
It was easy every year to assume the oil wave would continue and with each budget, projections were based on the per barrel price ever increasing.
Now the Alberta government has found itself in a precarious situation as oil is worth far less than what the 2015-16 budget was based upon. A huge budget deficit is coming Albertans way and there isn’t much that can be done about it now. In a lot of cases, some of the money has already been spent and promises made.
What can be done, is coming up with a new way to budget. Rather than speculative budgeting, the Alberta Tories should be basing future spending more on actuals. It would be far better to budget for oil to be low and look like heroes when it comes in higher than expected.
That “extra money” then needs to be put back into future savings, such as the Heritage Trust Fund, so there is a legacy for future generations.
There won’t be any easy answers and no matter the path chosen by Premier Jim Prentice, someone is going to be unhappy when the new budget is released this spring. Prentice needs to be brave and prove he has righted the PC ship by bringing in a budget that respects taxpayers, honours agreements already in place and spends the appropriate amount of money for the situation at hand.
The licence plate popular with some seniors that reads “I’m spending my kids’ inheritance” shouldn’t apply to the government.
Rose Sanchez is assistant managing editor with the Prairie Post. Contact her with your comments about this opinion piece at This email address is being protected from spambots. You need JavaScript enabled to view it. .

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Rose Sanchez

Assistant Managing Editor