Former Finance Ministers Morton, Liepert and Snelgrove line up with free advice.

Ted Morton MLA
Ted Morton

Free from the tight leash of party discipline, three former Finance Ministers are giving plenty of advice to Premier Alison Redford and Finance Minister Doug Horner.

Ted Morton, the former two-term Tory MLA from Foothills-Rockyview and two-time Tory leadership candidate who served as Finance Minister from 2010 to 2011, penned an opinion-editiorial in Wednesday’s Calgary Herald pointing out some common misconceptions about Alberta’s fiscal situation.

While Professor Morton correctly points out that the symptoms of Alberta’s financial woes are not a new phenomenon, his prescription is a tough pill to swallow.

In his column, Dr. Morton dispels the myths that 1) our fiscal problems are just because we are having a bad year, 2)  our fiscal problems are just because of the low price of bitumen (also known as the notorious ‘Bitumen Bubble‘), and that 3) this is just about a Budget 2013 deficit.

On his fourth argument, Dr. Morton diverts into a more conservative ideological direction. While he correctly points out the fickleness and limited life-span of some political agendas, the former Finance Minister criticizes his successor for choosing to use financing to fund capital projects. On this point, Dr. Morton appears to share the view of his ideological kin in Danielle Smith‘s Wildrose Party, who spent the waining days of 2012 on a relentless offensive against the government on this very issue.

Alberta Finance Minister Ron Liepert
Ron Liepert

Ron Liepert, the former two-term Tory MLA from Calgary-West who served as Finance Minister from 2011 to 2012, has suggested that it was time for the government to address its revenue problems by looking at tax hikes.

“Nobody likes to pay more taxes. Nobody likes to pay the taxes you’re paying today. But everybody wants the services,” Mr. Liepert told the Calgary Herald in December 2012.

Meanwhile, disgruntled former Finance Minister Lloyd Snelgrove, who quit the Tory caucus in 2011 citing irreconcilable differences with Premier Redford, told the right-wing Sun News that he does not believe the government has a revenue problem, but if it does then a sales tax should be imposed.

Back in 2010, the last Tory to seriously discuss the idea of a sales tax was then-backbench MLA Doug Griffiths (now Municipal Affairs Minister). Mr. Griffiths was publicly demonized by the opposition for even broaching the topic.

Only two years earlier, another now-former Tory MLA, who is also now one of the government’s most vocal critic of the government, stood up in Alberta’s Legislative Assembly and called for tax reform and the introduction of a sales tax in Alberta:

“I, too, believe that the government of Alberta should look into studying the feasibility of eliminating our provincial income tax and using a consumption-based taxation system in its place, with a provincial sales tax being the likely substitute revenue generator.” – Newly elected Progressive Conservative MLA Rob Anderson in April 2008.

23 thoughts on “Former Finance Ministers Morton, Liepert and Snelgrove line up with free advice.”

  1. Free advice, huh? I guess you get what you pay for.

    For Ted Morton (and the Wildrose?) to reject financing for major capital projects is like telling people they shouldn’t use mortgages to finance their houses.

    Since the Conservatives are so fond of saying “government budgets should be like household budgets”, this position makes no sense at all.

  2. I would far rather we have a provincial sales tax, that everyone pays, no exemptions, rather than the health care premiums that only working people paid. The health care premiums were not paid by everyone, we have the Indians who we made an agreement with called treatys, who paid no health care premiums, which is fine, but they would have to pay a sales tax which is fair. Then we have another group in Alberta who paid little health care premiums because they, on paper, singularly make little money, this group contributes very little to the surrounding communities businesses, while using hospitals and clinics like the rest of us, a sales tax would require everyone to help fund Alberta. If Alberta did not have to give the rest of Canada 12 billion plus every year under “equalization”, with 8.5 of that going to Quebec so they can have cheap university tuition and subsidized daycare, we would have no deficit, but that fact is never factored into leftie thinking as they attack the government over borrowing. If Ted Morton had won over hapless E.D. Alberta would be in a far better position monetarily now, Ted would not have fallen for every media driven dopey idea costing Alberta dearly.

  3. Amortization of capital projects is completely justifiable. If you build a new hospital or school or a university building, and use the best of materials possible, so that it will last at least 100 years, the benefits of that building will be spread over several generations, and all of them, rather than the taxpayers simply of 2013, should pay for the benefit.

    The nonsense that the wealthy elites are spreading about income taxes being job killers that should be replaced with sales taxes has been dispelled many times. No other province followed Alberta in producing a flat tax, which has meant that the wealthy have had a field day in this province for over a decade. No province comes close to Alberta in offering low taxes for the well off. It has not led to diversification of our economy and the claims of the elites that what we need is a further flattening of the flat tax, perhaps down to zero, is an example of self-interest masking as a proposal for the public good. It’s much like the employer attacks on increases in minimum wages as job-killers.

    We should establish comparable income taxes for Albertans to wealthy (and now conservative) Saskatchewan before we give any serious thought to regressive taxes like a sales tax. That might be needed eventually but in the forseeable future, our ability to raise income taxes substantially while still being a low-tax province, not to mention our ability to take far more in royalties from the energy companies, means that a sales tax proposal is simply a proposal to transfer monies from the working class and the poor to the idle rich.

  4. Notwithstanding the flat tax (thank you Stockwell Day!), the wealthy still pay a disproportionately high percentage of their taxable income to the province compared to lower income earners, due to the basic personal exemption (not to mention various other benefits and credits unavailable to those above a certain pay grade). Rob Anderson’s suggestion of replacing provincial income tax with a PST is worth considering, as of course is the idea of reducing spending to somewhere even remotely close to the average per capita in other provinces. Short of that, how about we hike the taxes only of those who voted PC last year? ;)

  5. What we need is the ideological conservative approach. It worked for Ralph Klein and it will work again now.

  6. Try comparing provinces using an income tax calculator: salaries over 100K invariably pay less in Alberta than in, say, Ontario, while those under 100K pay more in Alberta than in Ontario. There is a definite Alberta Advantage but it’s not for everybody. Most Albertans have been sold a bill of goods on taxes.

  7. And when we go into a Hospital or an Arena people, and look at the names on the donor boards, you know the names of people and “evil” corporations who have donated millions upon millions to fund such public places, do we ever see The Pembina institute/Sierra Club/Suzuki Foundation/ NDP party Teachers Union etc? No we see the names of wealthy families and good corporations who through their success have helped others with huge donations scholarships etc. to these and other projects. A sales tax will only help the province, dumping on the successful only shows lack of knowledge laziness and jealousy, thank god for the wealthy, because no one has ever gotten a job from a poor man. And smart people don’t mind a tax hike based on voting patterns, other than the sore losers, it’s a small price to pay for a successful province to live in.

  8. Firstly, congrats Dave. You are surely getting traction if all these right wing sycophants are commenting on your blog. Face facts, the flat tax is a failure. Use common sense, how is 10% from someone making 25k and 10% from someone making 400k the same thing? It is fine to leave one with 22.5k but the one with 360k should not be asked to contribute more? That flies in the face of reason and arithmetic. “Thank god for the wealthy”. Really. And who got the entire society in this mess? The poor, who don’t make political donations, don’t hire lobbyists, don’t have tax dodges?

  9. Glen, get a job, make some money, you’ll be happier. The rich are the reason you, or mom can afford a big screen, they started out at 5000 and now after many sold to RICH PEOPLE, shazaam, the price is 800, be happy, for the rich, have given you the opportunity to own one. Sincerly: Right Honorable Right Wing Sycophant.

  10. We have higher government spending in Alberta because we have a higher cost of living. The private sector pays their employees more in Alberta too. Are all the people running businesses in Alberta stupid or is that basic supply and demand? We want doctors, teachers, nurses, etc? Then we will need to pay them. I live in Fort McMurray. No one is going to work for the Government up here if you cut public pay… we already have to recruit teachers from out east and doctors from other countries.

  11. I can’t believe anyone is listening to these former finance ministers. They are the same people who got us into this mess. A definition of insanity is to try the same thing over and over, expecting different results. What we need is some fresh perspective and some new ideas. Unfortunately, this is Alberta.

  12. The flat tax is progressive – it just uses higher deduction limits rather than different rates. It is a resounding success for our province and collects more money than any other province in income tax.

  13. Glen said: “It is fine to leave one with 22.5k but the one with 360k should not be asked to contribute more?”

    There is no “asking” involved in what you advocate.

  14. Ted Morton was lauded by all sides, including Alberta Liberal suppporting students for his work as a Professor at the University of Calgary. On the whole, Dr. Morton seems like a very fair & balanced individual. I would think that having him as an economic advisor would be more prudent for Prem. Redford than say Ron Liepert.

  15. Alberta Liberals and Wildrose is Fresh new perspective. Yes they both are. Neither have been in office yet to blame anything on. Anything better than P-C’s.

    @Joe, Albertan, flax tax punishes low income earners during the tough times and protects the rich earners during the tough times.

    We need modest, incremental changes.

    -progressive tax
    -1% sales tax
    -1% increase in royalty
    -healthcare premiums + user fees for more access, to stop abusers
    -some intelligently though out tax incentive for people who maintain their normal weight and don’t smoke
    -decrease poverty, its a huge financial drain on gov’t revenue
    -mental health is a huge drain on corporate productivity
    -sell upgraded and refined product internationally

    the biggest hindrance to the financial success of Alberta is the Tories. They have stopped listening and have stopped becoming a source of sound solutions. They need to be fired for gross negligence and mismanagement. Yes they do.

    Even the financially discliplined Bartinsky would have fired the entire PC gov’t. Yes you would have Bartinsky, its the corporate thing to do. CEO’s adn CFO’s get fired if they can’t balance the books. Redfraud and friends are still getting a free ride for no productivity and no savings.

  16. Sheldon is right. Our costs are way higher because we cannot manage the impact of energy cycles in Alberta very efficiently.

    Its either a feast or famine cycle in Alberta. Surging prices, no good labour, shortage of good labour, high costs of living and housing and efficiency goes down. We need to learn to stabilize and smoothen out and stretch these cycles to make them more sustainable.

    Booms are not managed well at all in Alberta. Nobody, left or right can disagree with that. We need to come up with a more intelligent strategy to buffer Alberta from international energy markets a little better. We can start by staggering the Energy Projects and sharing the labour to build them in a staged fashion. Just a thought.

  17. RH said : “I can’t believe anyone is listening to these former finance ministers. They are the same people who got us into this mess.”

    You are right. Most ministers are corporate puppets and do what they are told in the backdoor committees.

    Most politicians have too many corporate promises to fulfill to be thoughtful and effective at democracy and governance. They are too beholden to their corporate alumni, friends and donors to be effective as public servants.

  18. First time in Alberta history that a Gov’t has run such a high debt, even when the Economy is hot, housing market is hot, people are moving to Alberta in droves, personal incomes are high.

    Usually at a time like this, you would expect the gov’t to be saving cash. Not this one. This group in office has a SPENDING AND REVENUE problem.

  19. Alberta has a deliberately manufactured royalty problem that has led to a deliberately manufactured deficit problem which by design is to be unloaded the most on those who can afford it the least. End of.

    AS/PER

  20. Because sitting on the oilsands has nothing to do with the incomes (and taxes) people make, Joe? Is that what you’re getting at?

    We collect more money than any other province because we’re far richer than any other province in our natural resources that we’re having a continual fire sale on.

    Once those are gone, do you think Suncor’s gonna stick around and keep your grandkids employed?

    And we don’t even have to touch royalties. We just need to treat oil companies like any other business and not provide tax credits for exploration and development. Let them take their own risks and pay for their own exploration costs.

  21. @ Kwil.

    The lion’s share of that ‘continual fire sale’ you mentioned is a direct consequence of Alberta’s laughingstock-of-the-oil-producing-world royalty regime.

    Otherwise though, you’ve outlined a just plan for a great start to the end of Alberta’s revenue woes, which means it will never catch on; because, unlike a sales tax, it doesn’t target the ‘correct’ demographic.

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