Calgary, AB — The Alberta budget is right to emphasize job creation and enhanced services but should have taken bolder moves to get Albertans back into good jobs, says Janice Plumstead, Senior Economist with the Canada West Foundation.
The provincial budget, unveiled today, commits $34 billion over five years to infrastructure construction. Through its new Job Creation Incentive Program, the government will also provide grants of $5,000 per job, supporting the creation of an estimated 27,000 new jobs per year through to 2017.
“The biggest issue in Alberta right now is the number of good jobs that have been lost as a result of falling oil prices,” said Plumstead. “The government is helping with a strong infrastructure spend and hiring incentives but more could have been done to rekindle the energy industry – such as immediate drilling incentives.”
Plumstead says the projected $6.1-billion deficit is a concern, although she is pleased the government has committed to budget balance by 2019-2020. Key to that target is the estimate that the price of West Texas Intermediate oil will rise from $50 per barrel in 2015-2016 to $68 by 2017-2018. “That estimate is optimistic,” Plumstead said.
Plumstead said there is risk that the oil project will not be achieved, raising the spectre of long-term debt pressure.
It is vital that young Albertans are not saddled with long-term debt. “We don’t want to find ourselves in a situation like Ontario, where taxpayers pay on average nearly $1,700 per year in interest charges and get no services at all for that money.”
Infrastructure spending on new schools is welcome but Plumstead called for more attention to the type of infrastructure that will generate jobs and growth. “To compete, we need more and better ways to deliver product to market.” Such trade infrastructure includes pipelines, rail crossings, border crossings, municipal shared infrastructure and intermodal hubs and highway corridors within and beyond Alberta.