The NDP government needs a real plan to scale back the dramatic pace of borrowing with a new report from the Fraser Institute confirming Alberta will see the fastest growth in its debt-to-GDP ratio across Canada and will soon be in a net-debt position, the Wildrose Official Opposition said today.
Alberta recently had its AAA credit rating downgraded in part due to, “projected weak budgetary performances in the next two years and moderate, but rapidly rising, tax-supported debt burden.”
According to the independent analysis, Alberta will see its debt-to-GDP ratio worsen by 92.6 per cent from 2008 to 2016, surpassing all provinces. The NDP budget takes Alberta’s net financial assets, which peaked at $40 billion in 2008, into a net debt position later this year.
“Without any changes, the NDP plan pulls more money away from front-line services because of higher interest payments, and puts the sustainability of these core programs at risk,” Wildrose Leader Brian Jean said. “The NDP have an opportunity in the upcoming budget to back down from their ideological experiments, and put forward moderate and practical strategies to slow down this dramatic increase in borrowing. While the NDP government cannot control the price of oil, they can and should scale back their dramatic pace of borrowing to reflect the current economic situation.”
In the fall, Wildrose put forward a series of constructive amendments to NDP legislation in order to put in place stronger protections for taxpayers against tax increases and increased borrowing. The NDP voted each amendment down.
Wildrose Shadow Finance Minister Derek Fildebrandt said today’s report once again highlights the need to protect Alberta from any further credit downgrades.
“Increased borrowing and debt will only hurt the long-term prosperity of our province,” Fildebrandt said. “We need a realistic and serious plan that gets Albertans working again, constrains spending and restores the Alberta Advantage.”