Notley attacks Kenney budget plan, says even a spending freeze is a harmful cut

EDMONTON — Premier Rachel Notley is taking aim at Opposition Leader Jason Kenney’s promise to rein in spending if he wins government, saying even a spending freeze would have profound and harmful consequences.

“Holding spending at zero does actually require reckless cuts in (other) parts of the system,” Notley said in a campaign-style attack speech Thursday at an Edmonton Chamber of Commerce event.

“When people get less at their hospitals and care homes, in their classrooms, it’s a cut plain and simple.”

Later, Notley noted that a lot of costs are out of the government’s hands, such as when drug costs go up or more students enrol in schools.

“We cannot control the cost of pharmaceuticals and that’s a huge component of our health care budget,” she said.

“So (if) that goes up then something else has to go down if you’re going to end up at zero.

Notley said the budget is rife with similar examples.

“We’ve been trying to keep our spending (on health and education) roughly a little bit below (the rate of) population and inflation, but even that is a struggle. Bringing it to zero would create a lot of hardship. That’s just the reality.”

Pollsters say Alberta’s fragile economy, and how to manage spending in a growing province with a struggling oil sector, will be the dominant issue in the upcoming spring election as Notley seeks a second mandate.

Her government, despite a downturn in the oil industry, has continued to fund growth in health and education and build more schools, hospitals and roads. The result is jobs and infrastructure but also high multibillion-dollar deficits and a ballooning debt.

This year’s deficit is projected at $7.8 billion for a population of 4.4 million, with the debt rising to just under $53 billion.

Interest payments on the debt this year will be close to $2 billion.

Notley said Kenney has not been clear on his spending plans, noting he mused publicly in 2017 about eventually getting Alberta down to per capita spending levels equal to B.C., which would equate to a 20 per cent drop.

Kenney has since said he’s not pursuing such draconian cuts. Instead, he has said that a spending freeze or modest cuts coupled with economic growth would balance the books in four years.

“The bogeyman of deep cuts that the NDP keeps ridiculously saying — that we have a hidden agenda to cut spending by 20 per cent — is completely unnecessary,” Kenney said Tuesday in a CBC radio interview.

Will there be budget cuts? he was asked.

“Wait and see, but if there are spending reductions they would be, I think, relatively modest,” he replied.

He said there can be reductions without losing quality of service.

“I have huge respect for our public servants, and I know when I talk to people in the health care system and the education system, they see inefficiencies.

“We want to set up a system where those front-line workers can help to inform decisions to get more value for the taxpayers’ money.”

Taxes are also expected to be a centrepiece of the campaign, which by law must have voters go to the polls some time in March, April, or May.

Notley, in her speech, said: “We have no sales tax, no payroll tax (and) no health-care premiums. And today I’m committing to all of you that if re-elected I will not bring in a sales tax, I will not bring in a payroll tax and I will not bring in health-care premiums.”

Kenney has said he would cancel Notley’s carbon tax if elected and will look at other tax reforms with an eye to having Albertans pay less.

His party members have voted to return to a flat tax on income, something Notley replaced with a progressive system, but Kenney has not said if he’ll commit a flat tax to the party’s election platform.

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