Premier Ed Stelmach remains confident Alberta’s public sector will buy into his plan to freeze wages for two years despite some early signs of resistance.
The Alberta Union of Provincial Employees rejected wage freezes Thursday and the Alberta Teachers Association expressed skepticism.
In Red Deer for the annual Premier’s Dinner, Stelmach was asked if the government would consider forcing a wage freeze through legislation.
“That’s speculation,” he said. “I’m highly supportive of our public sector and (they should) be recognized certainly for their efforts and we want to work with them. On the other hand, like I said, we’re committed to our financial plan.
“I know the first thing is, you know, everybody kind of braces and takes a position. But I’m confident we’ll work it through.”
Alberta Treasury Board President Lloyd Snelgrove has already begun talking to various union leaders to enlist their support in returning the province to a surplus position in three years, he said. The province is not asking unions for immediate wage freezes on existing contracts, but wants to hold the line on wages when contracts are up for renegotiation next year.
“We’ve just said we’re putting jobs before raises. Inflation is very, very low. We have very low tax rates for people working in the province.
“We’re just asking if we could freeze over the next couple of years that will certainly reach our goal of balanced budgets and getting back to the black in three years.
“I feel confident we’ll work this all out together and we’ll be able to reach a conclusion to it.”
The premier announced Thursday that he and his cabinet and senior staffers will take pay cuts or freezes. Stelmach will lose about $12,000 of his $213,000 salary. His ministers, who make about $184,000, will give up about $6,400 each. Last year, the premier got a $54,000 pay increase and cabinet ministers received a $42,000 boost.
During his speech to an enthusiastic crowd of 450 supporters at the $250-a-plate dinner, Stelmach outlined his plan, unveiled during a televised address Wednesday, to put the provincial economy back on track.
Stelmach will use the province’s $17 billion in Sustainability Fund savings to cover three-quarters of revenue shortfalls in the next several years. The rest will be found by trimming the budget.
“We were prepared for this downturn,” he said. “We have responded with a solid plan to weather the storm and return Alberta to balanced budgets.”
Alberta is the only province that has not added to its debt during the economic downturn. Ontario has piled up another $170 billion in debt, and B.C. $30 billion.
Stelmach reinforced his commitment not to raise taxes. Other governments have done it to pull themselves out of a recession and always failed.
The Alberta government will not “stick future generations with the bill for fighting this recession,” he said.
Infrastructure spending will continue because the province expects to add another 50,000 residents this year, who will need schools, hospitals and roads.
To lure investment and promote growth, Stelmach wants to make Alberta the most competitive market in North America. A competitiveness review to be finished this fall will focus on creating a level playing field in the upsteam oil and gas industry, he said.
Stelmach said he was aware of the difficulties facing Central Alberta due to the oil and gas slowdown and was meeting with local business leaders to discuss the future.
TD Financial Group chief economist predicted last week Central Alberta’s growth would trail the national average of two per cent or more over the next year or two because of its high exposure to oil and gas.
In a question and answer session, Stelmach was asked about the challenge posed by the Wildrose Alliance, which shocked many by winning a Calgary byelection last month, taking a long-held Conservative seat.
The premier said the party can’t lose sight of its principles and shy from making difficult decisions because of the threat posed by another party. Progressive Conservatives must stick together, he said.
“Remember, you are the engine of the Canadian economy. If we create even more uncertainty in this province it’s going to spread right aross the country and will inhibit any kind of growth we’re going to have in this province, or indeed, right across Canada.”