Budget Blog 2 .png

Alberta has a spending problem. The problem is we don’t spend enough!

The near universal declaration from conservatives of all stripes is that Alberta has a spending problem.

The Alberta Federation of Labour agrees that Alberta has a spending problem. The problem is we don’t spend enough!

Alberta spends consistently less on public services, as a share of its economy, relative to other provinces.

(Source: Office of the Parliamentary Budget Officer, “Fiscal Sustainability Report 2020: Update,” November 6, 2020)

As a share of provincial economies, Alberta’s spending on public services like health care, education, and social services – Alberta’s spending is the bottom of the barrel.

It is important to note where we here at the Alberta Federation of Labour got this information. The data is from Canada’s Office of the Parliamentary Budget Officer.

The non-partisan Parliamentary Budget Officer is an independent official for the Canada’s Parliament which provides independent analysis on government finances and trends in the Canadian economy.

The information in the graph above – program spending as a share of the provincial economy – is directly from Parliamentary Budget Officer’s Fiscal Sustainability Report for 2020.


Re-investment in Alberta

Jason Kenney’s cuts have hurt Alberta.

He chopped thousands of jobs and more than a billion dollars in his 2019 budget.

He gutted education and cut more than 1,400 jobs in his 2020 budget.

We expect the 2021 budget will bring more of the same.

What Alberta needs now is a government that will invest in our province and our future.

We need a government that will help Alberta families by supporting child care.

We need a government who will step up and help our workers at the frontlines of the COVID-19 battle.

In short, we need a government to do the opposite of what Jason Kenney has done to Alberta.


Taking an apple-to-apples approach

The Parliamentary Budget Officer uses spending as a percentage of the economy (through a measure called the Gross Domestic Product, or GDP) as a way to compare provincial spending.

Measuring the economy through the GDP is not perfect, but it is at least a consistent approach around the world, making comparisons between jurisdictions a bit easier.

The Parliamentary Budget Officer uses spending as a share of GDP to flatten out differences in provinces’ economies as a way to get an apples-to-apples comparison. This approach is common for economists and economic think tanks.

The Organization for Economic Co-operation and Development (OECD) uses this approach to compare taxation levels between countries. It also uses this approach to measure government spending differences.


Alberta economy has hit the skids under Jason Kenney’s leadership

Jason Kenney hasn’t governed exactly as promised.

“Jobs, pipelines, the economy” was his election slogan, but that hasn’t exactly worked out for Albertans.

He gambled billions on the Keystone XL Pipeline in the hopes that Donald Trump would get re-election, but that failed.

He failed to diversify the economy and instead fired thousands of educational workers in the middle of a pandemic and will soon fire thousands of health care workers.

And he failed to kick start the economy and instead drove our province into a recession even before the pandemic hit.

But Alberta still has a lot going for it.

Alberta’s economy outpaced the rest of Canada before Jason Kenney thought of coming back from Ottawa.

Our average wages are still higher than the rest of Canada and our labour market is still relatively robust, despite the downturn under Jason Kenney’s leadership.

Alberta’s unions and their members are still optimistic about Alberta’s future, but first we need new leadership and new ideas. And we need to invest in public service like health care and education to keep our province strong.