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Oil Prices, Wildfire Impacting Province’s Debt, Deficit

Fort McMurray, AB, Canada / MIX 103.7
Oil Prices, Wildfire Impacting Province's Debt, Deficit

Premier Rachel Notley provides an update on the Fort McMurray wildfire on May 16, 2016

The low oil prices and the Horse River wildfire are playing a big part in our province’s debt.

On Thursday, Alberta Finance Minister Joe Ceci released their annual report for the 2016-17 fiscal year.

Debt incurred by the Government’s capital and operational spending was at $33.3 million while expenses were at $53.2 billion.

The deficit is sitting at $10.8 billion, up $263 million from what they previously forecasted. This is on par with the second and third quarter projections.

The Fort McMurray Wildfire slowed the economy by 0.6 per cent. They spent around $710 million on firefighting alone, however, $495 million was offset by the federal government.

Despite the high amount of debt, the province notes they’re upsides in the economy.

From May 2016 – March 2017, economic activity increased by 7.7 per cent. Revenue was $42.4 billion, up $1 billion from their budget, despite the low oil prices and wildfire

They note during the year construction was also completed on 83 schools and projects including the twinning of Highway 63 between Fort McMurray and Grassland.

The report also notes oil prices are rising, averaging US$47.93 per barrel, up from their prediction of US$42.

Meanwhile, the Wildrose Party isn’t seeing the same positives as the NDP.

In a release, it notes the province was reckless with their taxes, shrunk the economy despite the estimated increase, and wasted money “meddling in our energy sector”

“This is without question the worst year on the books in Alberta’s history and the NDP government is working twice as hard this year to try and outdo themselves,” said Wildrose Leader Brian Jean, in the release.

The party notes the high deficit has plunged the province into an additional $13.3 billion in debt.

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