Alberta Politics

UCP swaps “fiscal reckoning” for a kinder gentler budget slashing hand

It took about a year but Alberta’s United Conservative Party government finally pivoted away from its “fiscal reckoning” rhetoric in exchange for a more kinder and gentler tone. In this year’s Provincial Budget, tabled in the Legislative Assembly today, “Protecting Lives and Livelihoods” has replaced the doom and gloom messages promoted by Finance Minister Travis Toews for most of 2019 and 2020.

The change in talking points and press conference backdrops is a reflection of a change in Albertans’ priorities since the COVID-19 pandemic began a year ago. The UCP’s “jobs, economy and pipelines” slogan that more accurately reflected the mood of many Albertans back in April 2019 has been replaced with talking points focused on funding health care and creating jobs. It is also an acknowledgment that cheerleading the slashing of public services has become politically unpalatable.

But what marks a pivot in messaging does not necessarily mark a change in the political project. The broad and deep budget cuts that Toews was said to be lobbying for are probably only put on hold until next year and the UCP is still moving forward with plans to privatize large swaths of the health care system and layoff more than 11,000 health care workers.

We’re not on a path of cost cutting. We’re on a path of delivering government services most efficiently,” Toews told CTV after the government announced it plans to cut the size of the public service workforce by 8 per cent.

It’s pretty clear they are on a path of cost cutting.

Colleges and universities are seeing a third year of big budget cuts. And plans to rollback salaries for remaining public sector workers are still in the works – and will likely spark further labour unrest with public sector unions.

It was probably determined by the UCP braintrust that during a global pandemic they could impose massive funding cuts to public services or cuts to public sector wages, but not both at the same time.

So, as well as shifting blame for Alberta’s financial problems onto public sector workers, Toews put blame on the federal government for standing in the way of resource development. Of course, Toews did not mention the billions of dollars of federal emergency pandemic funding that has poured into provincial coffers over the past year.

As it enters its second year of its term as government, we could now be seeing the UCP try to lay the groundwork for its re-election campaign in 2023.

The shift in messaging suggests the UCP has recognized how far its previous messaging had pulled it down in the polls.

Premier Jason Kenney‘s reluctance to pivot off his pipeline and economy messages, as well as his aggressive tone deaf attacks on anyone who dared to criticize his government – even as the criticism is coming from an increasing number of regular Albertans – is certainly a big reason the UCP has dropped in the polls and the Premier’s personal approval ratings are in the tank.

If Kenney is able to survive as party leader until 2023, he will face off against an increasingly popular Rachel Notley, who will be the first former Premier to run for re-election in Alberta’s history. Recognizing that Calgary could be the main electoral battleground of 2023, Notley and most of her caucus have basically become part-time residents of the province’s largest city.

Shifting to health care as its main issue puts the UCP firmly in territory where the Alberta NDP has much stronger footing. The UCP talking about supporting health care is like the NDP talking about supporting oil pipelines. Regardless of how hard they try, the UCP will have a hard time convincing Albertans that all of a sudden it is the great defender of the public health care system.

And despite Toews’ talk about the need for fiscal restraint, there is still money for UCP vanity projects like the Canadian Energy Centre, which is allocated $30 million annually to publish op-eds in the National Post and right-wing news websites and buy advertisements on Facebook.

The new budget also allocates $2 million to create an Environmental, Social and Governance Secretariat to stem the tide of divestment from the oil sands. The new mini-war room would report directly to the Premier’s Office.

It is unclear why Alberta requires two energy war rooms that appear to duplicate the work of the Department of Energy, the Department of Jobs, Economy and Innovation, the Alberta Energy Regulator’s communications department, the Canadian Association of Petroleum Producers, and the Invest Alberta crown corporation. Perhaps Kenney is trying to create more work for the Associate Minister of Red Tape Reduction Grant Hunter?

What the budget has in common with previous budgets is a lack of a plan to deal with Alberta’s long-time and self-inflicted revenue problems. Meanwhile, the UCP has focused heavily on criticizing government spending through the MacKinnon Report and the growing list of reports from international management consulting companies.

Toews’ budget speech also neglected to mention the giant elephant in the room – the $1.5 billion the Alberta government lost when betting on the construction of the Keystone XL Pipeline, which was cancelled by United States President Joe Biden on his first day in office.

But the government’s continued over-reliance on unstable revenue from natural resource royalties and its unwillingness to consider raising Alberta’s artificially low tax rates means that the problem will persist. Like previous governments, the UCP appear to be praying a bump in international oil prices will save the province’s balance sheet.

If it feels like you have read this last part before, it is because I have basically written this exact same thing on every Budget Day since I launched this website 16 years ago.

11 replies on “UCP swaps “fiscal reckoning” for a kinder gentler budget slashing hand”

Yes, it is kinder/gentler, if that means just not using as much polarizing rhetoric in talking about government programs. I also suspect you are correct, in that the UCP has shifted a bit from cutting programs to cutting wages of public employees. It might have taken them a couple of years to figure this out, but one it much more politically perilous than the other.

Unfortunately, education still seems to have a big bullseye for cuts. I am not sure that is a good long term strategic plan as having a well educated work force is part of what is needed to diversify our economy, but I doubt the UCP really believes much in diversification except the occasional lip service. They are betting everything on an oil recovery.

Interestingly, I have the feeling they are sort of taking their plans from the Klein playbook. Understate resource revenues projections, over state the deficit to justify cuts and if oil prices hold up, in a couple of years the deficit magically melts as they start to use more realistic oil prices and they take credit for the improved fiscal position due to their cuts. Oil prices have improved a lot recently (currently much higher than the numbers used in the budget) and may have even stabilized after the COVID shock of last year. The Klein strategy worked before, but I am not so sure it will work as well again this time.

Yes you may have been writing the same left wing drivel for 16 years but no one is buying what you’re selling. Why? Because Alberta is over taxed and people realize it. In 2019, Albertans voted for 20-30% deep, sustained Klein-style cuts, private health care, choice in education, and right to work legislation. Time for Kenney to deliver on our priorities.

If this blog is nothing but “left-wing drivel”, why do you read it? You’re just a troll & our host should just block you.

As for Albertans being “overtaxed”, we pay lower provincial taxes than anywhere else in Canada, and no provincial sales tax. So, in fact, except for those in the lower economic tiers, we are undertaxed for the levels of services we expect, and there are not going to be any more windfalls from a booming oil & gas sector to make up the difference.

We are not just competing with other provinces. We compete internationally and our tax rates are still punitive here. Under the NDP, income tax went up by up to 50%. Time for the cuts that Michael proposes. Kenney has failed to deliver on what we need.

Laurie H. Taxes didn’t go up under the NDP. There is a myriad of different tax types that the Alberta PCs put in. The old more cuts is the answer nonsense. Had the conservative governments in Alberta continued dong what Peter Lougheed was smartly doing, instead of waste, waste, waste, on shenanigans that are without rival, Alberta wouldn’t be in this bad financial state it is in now. The cuts of Don Getty and then Ralph Klein, who amplified them, weren’t a success then, and the bad results still are visible to this day. More cuts are not a solution.

Actually tax rates did go up under the NDP. Up to 50%, in fact.

It’s time for deep cuts to spending, services, and tax rates to get our economy going again and boost employment numbers.

Laurie H. The NDP didn’t raise taxes. In fact, it was under the rule of the Alberta PCs that we got so many taxes by different means. The old more cuts is the answer gimmick, is the usual neoliberal way, especially in conservative dominated Alberta. Had the conservatives not abandoned what Peter Lougheed had been doing right, these cuts wouldn’t have to happen. The conservatives in Alberta went on and did so many very expensive shenanigans, that are without rival. The cuts of Don Getty, that were amplified by Ralph Klein, still can be felt to this day. More cuts will not benefit anybody.

What you don’t realize is people don’t want these services anymore. They are bankrupting us. Kenney promised he’d bring union-backed public sector compensation down to the national average and has failed to do so. Michael is right, we need deep cuts, and we need them now.

As well we should be moving back to a complete flat tax. It isn’t a crime to work hard and make a few bucks. Alberta’s top tax rate was competitive at 39% prior to Notley and Trudeau. It’s now at 48%. Unacceptable.

Richard J. Ralph Klein’s flat tax was the best way to further drain Alberta’s coffers. More cuts aren’t the solution. The UCP has a knack for doing very pricey shenanigans, like the Alberta PCs had been doing since the mid to late 1980s, and onwards. What did this do for Alberta, other than leave Alberta flat broke? Nothing.

And many have questioned my sanity! Good lord Sisyphus! Pray on the new bones of Lawrence Monsanto Ferlinghetti. Let thy stone conquer you! You have no choice. No. Really. No choice. It is written. Death is the extension of life. If you read this? You’re dead soon!

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