Use of Sustainability Fund effective in protecting key program areas, but
long road ahead for Albertans unless energy prices rebound, says CA
EDMONTON, April 7 /CNW/ - Budget 2009 is a realistic financial blueprint
for Alberta that represents responsible planning during an economic downturn,
according to Jane Halford CA, the CEO and Executive Director of the Institute
of Chartered Accountants of Alberta. Halford was commenting on the 2009-10
provincial budget released by the Government of Alberta on April 7.
Combining the Sustainability Fund with the Capital Account and the Carbon
Capture fund, a commitment to find savings, and holding the line on income and
corporate taxes are all appropriate budget choices by the government, said
This year's deficit has been projected at $4.7 billion. In the subsequent
two years, deficits are projected at $2.4 billion and $1.8 billion,
respectively. However, the final two estimates in this three-year trajectory
will require an additional $2 billion in spending reductions or revenue
generation per year, the sources of which have yet to be identified.
"The $215 million in savings being sought this year are likely achievable
with minimal impact. But with the types of spending cuts projected for Years 2
and 3, it will be a long road ahead for Albertans," said Halford. "It's
imperative the government consult with Albertans in order to decide where
further cuts are to be made or further revenues are to be found."
The government's commitment to rebuild the Sustainability Fund with any
future surpluses is an important decision, said Halford. "We had hoped to see
a plan to replenish the Sustainability Fund as soon as surpluses return," she
said. "This budget shows how that will be done, and that's commendable."
Halford also commented on the following components of Budget '09:
Taxes: We were looking for a budget with no income or corporate tax
increases and a commitment by government to deliver on previously promised
business tax reductions. In this area, Budget '09 delivered. "Maintaining a
competitive tax regime is one of the best ways to stimulate economic growth,
and the government has kept its word on taxes," said Halford.
Maintaining vital government programs: Budget '09 does an excellent job
in maintaining appropriate budget levels for the most important areas of
government spending: health care and education. The fact that Alberta has the
Sustainability Fund to draw on in times of low revenues is the key reason why
spending in these areas can be protected and even increased without tax
increases or massive borrowing.
Finding savings internally: Albertans wanted to see innovative, effective
measures to reduce government costs internally. Budget '09 contains the
promise of modest savings measures, but Albertans likely expected more results
in this area.
The Institute of Chartered Accountants of Alberta (ICAA) is the
self-governing body which regulates more than 11,500 Alberta CAs and CA
students. The ICAA protects the public by setting the most rigorous
qualification criteria, and establishing and enforcing the highest
professional, ethical and practice standards. Visit our website at:
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