University of Calgary economist Trevor Tombe is more optimistic, pointing to a recent shrink of the gap between Alberta and British Columbia's borrowing rate, even without a credit upgrade. is the high level of government spending and this aversion to raising taxes." "This is why it’s so tragic to see a new government really struggling to figure out what to do with the legacy that’s been left to them, which. "It’s the same thing now, with a different commodity," Ascah says, referring to oil. The then-United Farmers of Alberta administration didn't raise taxes when it could have, and a calamitous crash in grain prices played a role in the province defaulting on its debts in 1936.
Take the relative prosperity of the early 1920s. Too often, he says, Albertan governments have missed opportunities to improve the fiscal picture in good times, and reacted poorly to the bad. The province speaks often of diversification, and Ascah argues it's imperative to put fewer of Alberta's economic eggs in the non-renewable resource basket. With January unemployment edging to 8.8 per cent from 8.5 per cent, Ceci admits hiring numbers aren't reflecting that growth, but says forecasts point to oil prices plodding their way back to something resembling not horrible and the economy regaining some steam. And then have the government take a long, hard look at those three dirty words in Alberta - a provincial sales tax.įinance Minister Joe Ceci is adamant the province is on its way back up, often referencing the economy's "green shoots." Next, exercise some tough love in public sector contract negotiations. That makes it more expensive to borrow cash - an issue opposition MLAs are sure to raise in question period with the legislature back in session Monday and a new provincial budget to be introduced on March 16.Įconomists says there can be no return to AAA status unless the government leaps off its fiscal toboggan and takes concrete measures to rein in spending.īob Ascah, fellow at the University of Alberta's Institute for Public Economics, envisages a three-pronged attack before the province can begin to win back its AAA rating.įirst, he proposes bringing in an outside consultant to review every government program, looking at those that are nice to have but not strictly necessary. In 2016, as oil prices stayed low and the province charted a $10.8-billion deficit, ratings agencies gave Alberta's outlook a thumbs down and dropped its credit rating to a AA+ or AA from that once-shining AAA. Manage Print Subscription / Tax ReceiptĪlberta once stood atop the AAA credit-rating mountain, but today the province’s borrowing position is a few steps removed from that lofty summit.
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