EDMONTON – Alberta’s municipal affairs minister says while next month’s provincial budget will be difficult, the days of off-loading all the pain onto towns and cities are over.
“We’re not going to put all the pain on their backs,” said Doug Griffiths following a speech to members of the Alberta Urban Municipalities Association at a downtown hotel Thursday.
“It was so easy before in previous budgets when you found a (revenue) low, you just cut all infrastructure from the province and you cut funding for the municipalities,” he said. “Then you could continue to fund health care and education.”
But Griffiths said the budget will reflect the reality that growth pressures faced by the province are matched in towns and cities.
“The investments that they’re going to need to make are just as critical,” he said.
Premier Alison Redford’s government will deliver its 2013-14 budget on March 7.
Redford has warned Albertans it will be a hold-the-line document or worse, given that falling oil prices are expected to cut $13 billion in expected oil and gas revenues to about $7 billion.
The province is trying to keep the operating side of the budget in balance while taking on debt to pay for some infrastructure projects.
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The Opposition Wildrose party says that is reckless, given that Alberta already spends 50 per cent more per capita on infrastructure than similar provinces. The party is urging Redford to prioritize projects and draw some out over longer timelines.
That’s not the answer, said Griffiths. He told AUMA members that with 100,000 people moving to Alberta every year, a go-slow plan would just penalize families and “balance the books on the backs of kids that need schools (and) communities that need health care.”
Wildrose Leader Danielle Smith’s party is proposing a 10-year plan that would deliver $48 billion in capital spending while avoiding long-term debt and making sure municipalities are paid first.
Redford’s plan is simply not working, said Smith, who was also at the event.
“Every time this government puts something in the budget, it seems like the municipalities have to wait on pins and needles to see whether it’s going to get clawed back the next year,” said Smith.
“I don’t think that’s fair to our mayors. I don’t think it’s fair to our municipalities. And that’s why we think it can be done differently.”
AUMA president Linda Sloan said predictable funding is the key.
“A large number of municipalities now rely on borrowing to do the infrastructure renewal,” she said.
“The grants are just not flexible and have not always been sustainable.”
In a speech to AUMA members, Sloan pointed out Alberta has a $24-billion infrastructure deficit in a province that has 10 of Canada’s 15 fastest-growing communities.
Sloan said the oilsands region of Wood Buffalo has seen a 42 per cent population bump in the last five years. There was $180 million worth of new construction in Lloydminster alone last year.
Liberal critic Laurie Blakeman says Griffiths’ department is failing because of unequal funding formulas and policies that penalize the two-thirds of the population who live in Calgary and Edmonton.
“Edmonton and Calgary should have much more decision-making powers. They’re carrying most of the load of what the provincial government used to provide,” said Blakeman.
Redford herself was to have spoken to AUMA members, but had to cancel due to illness. Griffiths said Redford has been fighting the flu.
Griffiths’ speech was part of an ongoing government information campaign to let Albertans know that the price spread between the North American benchmark for oil and what Alberta is getting for its oilsands product has wreaked unexpected havoc on the provincial bottom line.
Critics have countered that the Tories under Redford and under former premier Ed Stelmach have simply been bad money managers for relying too heavily on the roller-coaster prices of oil to pay for day-to-day operations.
Their case got a boost from an unexpected quarter Thursday. Former Alberta Tory finance minister Ted Morton, in a Calgary newspaper editorial, said Redford’s plan to take on debt while continuing to pump the ground dry of oil is a recipe for disaster.
“No family or business can simultaneously sell assets and borrow at the same time, at least not for long,” wrote Morton.
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