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Brace for more red ink, no good plan for balance in Alberta budget: opposition

EDMONTON — Opposition parties say Albertans should brace for a provincial budget with rosy revenue projections at the front end but more red ink at the back when the bills come due.
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Finance Minister Joe Ceci says the budget will avoid deep cuts to front-line services while continuing to spend on operations and capital projects. (Photo by THE CANADIAN PRESS)

EDMONTON — Opposition parties say Albertans should brace for a provincial budget with rosy revenue projections at the front end but more red ink at the back when the bills come due.

Finance Minister Joe Ceci, who is to table the 2018 budget on Thursday, announced earlier this week that it will stick to the theme of avoiding deep cuts to front-line services while continuing to spend on operations and capital projects as Alberta works itself out of the oil-crash doldrums.

That approach has resulted in multibillion-dollar deficits and a debt load that tops $40 billion, but Ceci is promising to release a step-by-step plan to return to a balanced budget in five years.

Alberta is running a $9.1-billion deficit this year on total revenues of about $47 billion.

Alberta Party house leader Greg Clark said given those numbers, a balanced budget by 2023 with no significant reductions is not realistic.

“I strongly suspect what that means is their operational spending continues to go up significantly, and that they cross their fingers and hope that oil prices go up,” Clark said Wednesday.

“They’re doubling down on the resource revenue roller-coaster.”

Ceci has said the five-year plan will include revenues from newly approved pipeline projects, including an Enbridge replacement line to Wisconsin and the Trans Mountain expansion on the West Coast.

The Enbridge Line 3 project is underway, but Trans Mountain is being opposed by the B.C. government over concerns about the impacts of oil spills.

Ceci said earlier this week the oil revenue estimates will be realistic, using private sector forecasters.

“Budget 2017 identified (oil to average out at) US$55 a barrel, and what are we going to find at the end of this fiscal year? Probably $54 a barrel. So that’s not far off in the forecasting world.”

Both Clark and United Conservative Leader Jason Kenney say that factoring in revenue from Trans Mountain in the face of uncertainty threatens to put any budget plan even further out of whack.

“I think the credibility (of the budget) will be based on whether (the NDP) are prepared to identify meaningful spending restraint,” Kenney said.

This is expected to be the last full budget cycle prior to the spring 2019 provincial election.

The opposition parties on Wednesday put forward their own proposals for the budget.

The Alberta Party proposes achieving balanced books within five years by keeping spending relatively flat while eliminating waste and duplication in the $20-billion health portfolio.

Kenney suggests tax cuts and a government spending freeze to return to balance while avoiding deep cuts to frontline services.