Alberta Premier says soft oil prices mean belt-tightening

Alberta Premier Danielle Smith is warning that softening oil prices means provincial funding won’t keep pace with population growth in next week’s budget.

In a televised provincewide address on Wednesday night, Smith said the Feb. 29 provincial budget will be balanced but fiscal belt-tightening is required.

“Spending cuts will not be needed,” Smith said in the eightminute address, aired on TV and online.

“Lower resource revenues will certainly require us to show more restraint than previously predicted.

“We will ensure this is done thoughtfully and with priority given to the programs and services Albertans most rely on such as health, education and social supports.”

Smith said she has instructed Finance Minister Nate Horner to limit government spending to below the legislated rate cap of inflation plus population growth.

The Opposition NDP has long accused the province of failing to fund for growth in health care and education and has said not matching funds to growth is equal to a budget cut.

Census data provided by the province last November reported Alberta added 184,000 people for 4.1 per cent growth in the 2023 census year. Growth of 2.9 per cent is expected in the 2024 census year.

The NDP said Smith’s speech was all about broken promises.

“The premier had an opportunity tonight to keep the promises made to Alberta families during the last election, fix the chaos her government has created in health care and make life more affordable for Albertans, but she didn’t,” said NDP deputy leader Christina Gray in a statement.

Gray said Albertans instead are missing out on at least $272 million in affordability measures the premier promised in the last election, as well as action on lowering utility prices, high rents or even to offer relief on soaring insurance rates.

“This is unacceptable. It’s clear that Danielle Smith and the UCP are only willing to maintain the current state of chaos we see across our hospitals, schools and in family budgets.”

For decades, Alberta has tied budget spending to the mercurial ups and downs of oil and gas prices, leading to years of eye-popping multibillion-dollar surpluses set against equally alarming deficits.

Alberta’s most recent forecast for this budget year, which ends in March, forecasts a $5.5-billion surplus against almost $69 billion in spending.