Hope is not a strategy: Alberta budget 2017 fails to create environment to grow jobs and economy: Calgary business responds to budget
CALGARY – The Alberta Government tabled the 2017 provincial budget, revealing yet another large provincial deficit—$10.3 billion. Business was disappointed to see fiscal discipline, and additional support for innovation and entrepreneurship, was not high on the agenda.
“Hope is not a strategy. Commitments to jobs and investments can’t be based on an environment of hope, they have to be based on an environment of certainty” says Adam Legge, President and CEO of the Calgary Chamber. “What businesses mainly want is for government to not make it any harder to survive in these challenging times, and this budget shows us there is clearly no plan to make it easier. A massive deficit creates additional current and future financial burden for all tax payers.”
Nonetheless, it was heartening to see a commitment made to containing operating expenditure increases to less than population growth plus inflation.
Businesses would have liked to see the Alberta Government expand the definition for small businesses, and provide more incentive for companies to invest in developing innovation and technology. Calgary businesses put forward 13 key priorities they were looking to see support for in this budget, and saw meaningful movement on 3 of those.
“We were really hoping to see additional support for innovation and entrepreneurship in this budget, and it was notably missing,” said Legge.
However, the Chamber was pleased to see the government’s continued support for small businesses through maintaining the reduced small business tax rate, and the tax credits created last year. These initiatives will continue to allow Alberta’s small- and medium-sized businesses to grow and reach new markets.
“We saw important funding continue for programs that drive investment – like the Alberta Investor Tax Credit. However, the combination of this deficit and doubling our borrowing for day-to-day costs, means there is not enough of a path back to balance” says Zoe Addington, Director of Policy, Research and Government Relations at the Calgary Chamber. “When a government borrows money, dollars that should be used for necessary services are instead spent on interest payments. When government spending increases faster than the revenue coming in, increasing taxes will eventually be on the way. This means greater costs for businesses and residents.”
Albertans pay more on average for critical services like healthcare and education than other provinces do, and get less for it. Holding ourselves to performance standards or using performance-driven compensation would be low-cost, proven ways to improve the value we get for tax dollars. Businesses have called on the Government to use performance standards, as all businesses do, to increase efficiency.
Alberta must come to terms with our spending problem. The return of a high price of oil and strong economic growth would go a long way in revitalizing Alberta’s economy, but hoping that’s going to happen should not be our budget strategy.
For additional comments or to request an interview, contact Scott Crockatt at 403-681-5529 or [email protected].
About the Calgary Chamber
The Calgary Chamber is a non-profit, non-partisan organization. For 126 years the Chamber has worked to connect Calgary’s businesses, help them grow and expand their influence in an effort to make the city an even better place to live and work for all.