There’s going to be a whole lot of red ink in the Alberta provincial budget.
That was a key takeaway from Alberta Premier Rachel Notley’s televised address to Albertans Thursday evening on the upcoming budget and the state of the economy.
The NDP leader said that the 2016-17 deficit is set to be more than $10 billion, almost entirely due to the crash in oil prices and resulting lower revenues.
“The oil price shock goes right to our province’s bottom line,” she said. “Dollar-for-dollar, lower royalties mean a higher deficit.”
Notley said the government is projecting royalties to drop by almost 90% in 2016 from their record high of $10bn two years ago. She re-affirmed her government’s message that they will not be engaging in “slash and burn” policies to get the budget back to balance.
She assured viewers that the government does plan to reduce the deficit in future years, saying it would go back to balance once the economy recovers.
Notley also promised $34bn in infrastructure spending over the next five years, set to be put towards roads, new schools, and new hospitals. She noted that former Bank of Canada Governor David Dodge advised the government that now was the time to make such an investment.
“These infrastructure investments will create jobs today, and benefit our children and grand-children for generations to come,” she said.
The premier also vowed to continue to fight for pipelines to get Alberta’s oil to tidewater, and announced increased access to capital funds for Alberta businesses.
The provincial budget is set to be released next week.