Now that we have a budget we’d like to take everybody back to the not-yet-premier Jason Kenney talking about “more money in the pockets of Albertans.”
First, there’s a difference between more money for the province, and more money for individual Albertans, and the UCP, in our opinion, deliberately obscured those differences while campaigning on spending cuts and austerity.
In order to add to provincial coffers, the government was evidently forced to draw a distinction between necessary and unnecessary expenses.
Without even getting into the details, we can pick a few of them apart.
Assured Income for the Severely Disabled is not indexed anymore, meaning it won’t rise with inflation. That’s not more money. Capital projects in municipalities will be receiving less funding in years to come ($236 million less by 2022, to be exact).
Also, not more money.
Second, the budget is built on uncertainty. In order for this budget to go ahead as planned (without further cuts) the UCP has banked on TWO pipelines being fully operational by 2022 — one being the Trans Mountain expansion.
At the same time, one band-aid solution put together by the previous government to get the oil out of the province and to markets was to deliver it by rail. The UCP deepened the deficit by an extra $1.5 billion in order to get out of that contract.
In other words, they got rid of a temporary solution and replaced it with a question mark.
The other promise was that reducing corporate tax from 12 per cent to eight per cent over four years will bring jobs back. The evidence provided in the budget is flimsy: it quotes a Janice MacKinnon (of the MacKinnon report) study from 2017 which suggested that for every $1 increase in corporate tax revenue, aggregate salaries drop $0.95.
But where’s the link between lower corporate taxes and more jobs? It’s unclear. We might be accused of not having any vision for the future and that things take time. But then why make the promise in the first place?
Here’s the short-term view: the province will lose $1 billion in revenue from corporate taxes if it is offset by their projected increase in personal income tax. Obviously, that projection relies on the corporate tax resulting in more jobs. It’s called circular reasoning.
So whose pockets are we talking about again? It’s from our pockets for the next four years at least, not in our pockets.