Morton wants to refill rainy day fund

Alberta Finance Minister Ted Morton says he’d like to see legislation next year requiring the province to rebuild its rainy-day account

EDMONTON — Alberta Finance Minister Ted Morton says he’d like to see legislation next year requiring the province to rebuild its rainy-day account.

A string of budget deficits will nearly drain the Sustainability Fund over the next three years. So Morton says he wants a new law that forces the government to replenish the fund as the economy improves.

“As we transition from deficits to surpluses, we need to put in place a fiscal plan that ensures that the rainy-day fund is built up again,” he told reporters Thursday. “Similar to the debt-repayment requirement we had back in the 90s.”

The minister says it’s too early to talk about specifics, but added he hopes to draft legislation in the coming year and introduce the bill in 2011.

“We’ve seen the benefits of the Sustainability Fund last year, this year and next year,” said Morton.

“So we’ve got to make sure that when good times return that we build it up again in anticipation of another downturn, which of course there will inevitably be.”

Morton gave a speech Thursday to the Edmonton Chamber of Commerce promoting the new budget, which pours money into health care and building projects while leaving a record $4.7 billion deficit.

But the minister rejected criticisms from the Canadian Taxpayers Federation and others that the government failed to follow through with a long-promised $2 billion “fiscal correction” in this budget.

Morton explained that the province was able to find $1.3 billion in savings from more than a dozen departments. But he also confirmed that the entire amount was redirected into other priorities, especially health care, which got a $2-billion funding boost.

The chamber has endorsed the budget, but chairman Carman McNary told the crowd of 150 that they will be watching the government closely.

“We believe that the government is going to have to make some tough decisions in the next year or two,” said McNary. “All spending needs to be assessed strategically in order to achieve value.”