Banking on a boom

At first glance, the budget Premier Alison Redford’s Alberta Tories served up on Feb. 9 is pretty hearty.
   It heaps hundreds of millions of more dollars into education, health care and family services without hiking taxes or slashing a single department budget. There are sprinkles of new schools, roads and health services. There are boosted payments to Assured Income for the Severely Handicapped (AISH) program recipients; more cash for agencies that support vulnerable children, families and those with developmental disabilities to help recruit and retain staff.; and $500 million for student financial assistance.
Topping it off is a sparkling proverbial cherry of a promise Alberta will be out of the red within a year.
Best to belly up to the dinner table because it’s a feast Albertans won’t want to miss.
Don’t worry about the bill. “Alison in Wonderland,” as she was dubbed by a rival party, has it covered. There’s billions to raid from the piggy bank, and don’t forget that forecasted boom in non-renewable resource revenues. That’ll cover it. After all, isn’t that how Average Joe Albertan plans his spending splurges? By banking on a future raise because he’s sure that this is the year that the figure on his paycheque jumps?
There’s no denying this is a pre-election budget aimed at wooing potential voters. Trouble is, it’s a budget built on ice as sturdy as that on Henderson Lake after a week of 10 C temperatures.
The plan, as reported by The Canadian Press, is predicated on the price of oil staying high and even soaring to an average of US$108 a barrel by 2014.
It currently sits close to US$100 a barrel.
The bottom line amounts to an $886 million deficit, the fifth in a row after 14 years of surpluses.
The budget boosts government spending by 3.3 per cent to a record $41.1 billion.
Program spending is up almost seven per cent, with substantial raises for education, health, cities and money for the most vulnerable.
The bills are to be paid for with rising oil revenues, higher taxes from a growing population and a $3.7-billion drawdown from the $7.5 billion Sustainability Fund.
The budget projects that with oil revenues and population growth, there will be a $952 million budget surplus next year and a $5.2 billion surplus the year after that.
Those are some fantastic numbers that have left many scratching their heads because they believe them to be too high. The Tories’ crystal ball better be accurate. The province can’t afford to see those projected revenues turn out to be more of a bust than a boom. Because if they do, Average Joe is the guy who’s going to be left footing the bill.