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Sunday, February 27, 2011

Some Priority Concerns Raise Questions in the Alberta Budget

I think the Alberta Budget announced this week - Premier Stelmach's last, has a lot going for it. There is some stuff that is not great but it is by and large a progressive prudent budget.  It is delivered in the classic political technique of setting up trial balloons of pending harsh expectations, then delivering something less brutal seems like a reprieve.  So the kudos are not always the result of any pure objective analysis.  Perceptions, values and mindsets of citizens are always a big part of the art of budgeting.

The Wildrose Alliance will say we have a spending problem and dire consequences will befall us is just wrong on the facts and misleading in the analysis.  More on that in subsequent posts I expects.  Bottom line is there is not deficit in this budget.  We earmarked cash in the Stability Fund to pay for much needed infrastructure to responds to years of neglect and to catch up to the population growth we ignored in the Klein days.  Using that designated cash on hand to build schools and hospitals and roads is not creating a deficit.

What I really want to do is direct your attention to an excellent editorial in the Edmonton Journal of Saturday Feb 26.  The title captures the mood of the piece "Budget Rich in Troubling Questions."  I think there are some unsettling questions Albertans need to ask themselves about if we are paying our way for the necessary public services we demand from government.  We also have to revisit the "huge handouts ...to oil and gas companies...in the drilling stimulus program."

Read this editorial carefully and consider if these policies make sense to you on incentives and royalty breaks.  Do we really need them or should Albertans start acting like the owners of our resources and have a more mutually beneficial business-like and not serf-like relation with those we license to develop our resources.

1 comment:

  1. So why don't you ask an expert and why didn't the Edmonton Journal? I would think that incentives mean alot for small Canadian independent businesses, particularly when the commodity price for natural gas remains unprofitable, and considering the ratio of dry-holes to striking pay-dirt. Consider how many dry holes were made before the Leduc discovery. Imperial Oil only had the kind of heft to be able to drill was it 450 dry holes? They were ready to give up when they thought, 'let's take one more chance!' No, I'm inclined to not want to fool around with incentives. In a way, that's worse than altering the royalties. At least with royalties, you've already hit pay dirt, so you can withstand the royalty. But without incentives, I think alot of plays wouldn't get drilled; but why didn't the Journal ask a driller?

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