[andrewf]

Low tax? Are you kidding me? The federal taxes alone make Canada and all provinces included a highly taxed country. Albertan taxes are high - they are just not as stupidly high as other provinces.

Prior to NDP coming to power Alberta had a nice heritage fund and very little debt. Obviously now that has changed. This year portion of debt will be repaid, heritage fund will be added to, and Alberta will continue propping up bankrupts out east. What else do you want?

Also, Ontario collects less revenue per capita and spends less per capita than other provinces. Alberta has far higher per capita spending than Ontario, and any other province other than NL. Alberta could be banking over $1000 per capita annually in resource revenue that it instead chooses to blow on current consumption.

Financial Accountability Office of Ontario | Commentary

The Office provides independent analysis on Ontario's finances, trends in the economy and related matters important to the Legislative Assembly.

www.fao-on.org

 

[sags]

Alberta has never managed their boom and bust cycles very well.

It is much easier to blame everyone else for their lack of good fiscal management.

 

[damian13ster]

Revisionist history? It was small before the NDP took power, and continues to be small.

I should hope Alberta could manage to balance the budget with oil at USD$120/barrel.

The debt is at over 120bln. It is by no means small anymore.

And agreed with what you said - Alberta has spending problem. Spends more on healthcare and education than national average despite lower cost of living. Public unions jacked up salaries because province in certain times could afford it and they took the government and tax-payers behind a woodshed during negotiations. The sunshine list for Alberta is worth a read - it is a doozy and shows the kind of structural spending problem the province is dealing with

Like you noticed yourself, it is not a revenue problem, it is a spending problem - hell, there was an uproar when they wanted laundry services to go to private corporations rather than union to save taxpayers millions

 

[londoncalling]

Taxation and spending need to be consistent. It makes sense that Ontario spends less per capita as it also taxes less. That should be quite obvious. Some can provide good value and quality services with a high tax rate and others cannot or do not. The past few posts have been good examples of poor spending. Ultimately, future spending is determined by current investment from all revenue sources including taxation. Other things that need to be considered in cost of services are population density and geography. this is why rural servicing is always expensive on a per capita basis. For Alberta and Ontario the spread is not as big a factor than between Canada and many European countries.

 

[sags]

After decades of Conservative governments, Albertans should know who is responsible.

 

[damian13ster]

They do. That's why they kicked the NDP out of power first opportunity they got, after giving them a chance in 2015

 

[andrewf]

They do. That's why they kicked the NDP out of power first opportunity they got, after giving them a chance in 2015

This is a long-standing trend, under the previous one party state in Alberta.

 

[damian13ster]

This is a long-standing trend, under the previous one party state in Alberta.

Meh, everyone can look at heritage fund inflows and debt history and look at actual objective numbers rather than listening to posters who don't provide any data

 

[andrewf]

Loading…

open.alberta.ca

Show me on the chart on page 3 of this report the massive decline in value in the fund during the NDP government, and look at page 9 where it shows to fund steadily being drawn down in value under the one party PC party rule.

 

[damian13ster]

Loading…

open.alberta.ca

Show me on the chart on page 3 of this report the massive decline in value in the fund during the NDP government, and look at page 9 where it shows to fund steadily being drawn down in value under the one party PC party rule.

Since the Fund was established in 1976, it has received deposits of approximately $12.0 billion from non-renewable resource revenues and $3.9 billion from budget surpluses in 2005-06 to 2007-08.

All the deposits and the creation of the fund was under PC. What did NDP do to help the fund?

Albertans have spoken and kicked NDP to the curb after giving them a chance at ruling. There were valid reasons for it. I have lived here under NDP rule - it wasn't pretty.

 

[sags]

The Heritage Fund report is embarrassing and Albertans should be outraged over the mismanagement of the fund.

$43 billion transferred to government "general revenue funds" since inception ? $1.2 billion transferred to government "general revenue funds" this year ?

Didn't Premier Kenney also dip into the Alberta public pension fund to invest $1.5 billion into the defunct Keystone Pipeline ?

Cripes.........I am glad Alberta's Premiers don't manage the CPP fund. They got really sticky fingers.

 

[damian13ster]

Isn't covid precisely when the emergency fund should be used?
The fund is actually really well managed. Returns are pretty damn good,

The idea of heritage fund was great and it is paying off handsomely, thanks to large investments in it done by conservative party (none by NDP). The issue is the deficit spending that started in 2014/2015.
Prior to that Alberta's financial position was very good. The charts above don't lie. Look at the deficits and debt added under NDP. It will take couple of decades to clear up the mess they did in 5 years.

It really isn't an accident that debt and deficits exploded when conservatives lost power - both on federal and provincial level.

The problem is that the spending has been a complete waste. Government services are worse than they ever have been before despite massive money printing. That's the entire tragedy

 

[sags]

The "returns" on capital would have been much higher if the Conservative governments hadn't continually drained the fund to pay their day to day bills.

Yearly return on capital is an important data point, but so is time in the markets which the money that was withdrawn never had a chance to accumulate.

 

[andrewf]

Isn't covid precisely when the emergency fund should be used?
The fund is actually really well managed. Returns are pretty damn good,

The idea of heritage fund was great and it is paying off handsomely, thanks to large investments in it done by conservative party (none by NDP). The issue is the deficit spending that started in 2014/2015.
Prior to that Alberta's financial position was very good. The charts above don't lie. Look at the deficits and debt added under NDP. It will take couple of decades to clear up the mess they did in 5 years.

It really isn't an accident that debt and deficits exploded when conservatives lost power - both on federal and provincial level.

The problem is that the spending has been a complete waste. Government services are worse than they ever have been before despite massive money printing. That's the entire tragedy

The point stands that Alberta is blowing its resource endowment on current consumption by using those revenues to bridge the gap between very high spending and low revenues. Classic grasshopper mentality. Eventually, Alberta will be left with uneconomic reserves and no financial endowment to show for it.

 

[damian13ster]

Alberta has reserves for a century.
The province does have the spending problem. Unions took advantage of government and now spending per capita are the highest in the country and need to be lowered - the problem is that even such an obvious change like saving millions on laundry services has unions get their panties in a wad and NDP buying attack ads

 

[andrewf]

Alberta has reserves for a century.
The province does have the spending problem. Unions took advantage of government and now spending per capita are the highest in the country and need to be lowered - the problem is that even such an obvious change like saving millions on laundry services has unions get their panties in a wad and NDP buying attack ads

The reserves won't be economic for a century. Enjoy it while it lasts. Eventually Alberta will be back to pauper have-not status like it was before oil was discovered.

 

[londoncalling]

Just to provide some additional context I have provided a link to the price of oil. Unfortunately, I was unable to find an inflation adjusted chart for western select. It would seem that the debt graph and budget stats in post #830 have more to do with the price of oil than any other factor. It also correlates well with the event timelines in the heritage fund report. I draw the conclusion that Alberta's fortunes have always been tied to the price of oil. Government policy has moved the needle either direction very little over that timeline. The fund has served its purpose as stated in the report. However, I feel that the aim of the fund is short sighted. Perhaps drawing less in boom times would provide better growth for the fund to offset reliance on significant draw during down times.

Crude Oil Prices - 70 Year Historical Chart | MacroTrends

 

[damian13ster]

On some perspective, yes.
However, the price of oil in 1995-2005 was lower inflation adjusted than 2014-2019.
Yet the debt and deficits don't reflect that at all.
You can see that spending decreased with decrease in revenue under CPC government. Spending kept increasing under NDP despite revenue dropping - that's the difference

 

[londoncalling]

Yes indeed. Based on your chart deficit budgets started in 2010? and have been in place ever since. As you indicated the spread gets worse in 2016. Hopefully, for Alberta high oil prices continue. Definitely, easier for provinces like AB and SK to govern with high commodity prices.

 

[damian13ster]

Yes indeed. Based on your chart deficit budgets started in 2010? and have been in place ever since. As you indicated the spread gets worse in 2016. Hopefully, for Alberta high oil prices continue. Definitely, easier for provinces like AB and SK to govern with high commodity prices.

Yes, I have posted this previously