Government Finances Archives - Page 10 of 12

18Oct

By Bob AscahNo Comments

Government Finances, Opinion/Research, Politics

Harmonized Sales Tax not a Panacea- Opinion

But neither will ignoring the revenue side cure the deficit problem Franco Terrazzano's Opinion piece in the 9 October Edmonton Journal is quite right when he observes that a “provincial sales tax won’t erase Alberta’s red ink.” No single mechanism can do that. Alberta’s massive deficit and future deficits will not go away merely by blaming Alberta politicians (past and present) who have spent resource wealth on maintaining a high level of public services and infrastructure. However to suggest that sales tax advocates believe a sales tax will eliminate the deficit by itself is disingenuous. The economic argument for a sales tax is compelling for a number of reasons. First, it is a far more efficient tax than personal or corporate income taxes. A commonly used metric of the economic cost...

8Sep

By Bob AscahNo Comments

Agencies, Budget, Energy, Government Finances, Politics, Uncategorized

After waiting an extra 2 months 2019-20- some major surprises missed in February forecast

Updated 10 November 2020 In an earlier report on the crucial role played by the Alberta Petroleum Marketing Commission (APMC) in government finances, we highlighted the Commission's role in overseeing the North West Redwater Upgrader investment, commenced in the latter years of the Stelmach regime. We raised some doubts, given APMC's record with the North West Redwater Partnership (NWRP), about its competence in negotiating with TC Energy on the Keystone XL project. APMC is also the agency tasked with negotiating the Energy East commitment and the controversial oil-by rail contracts. With the two-month delay in the publication of the Government of Alberta's Annual Report and audited consolidated financial statements, the public finally has been apprised that Alberta's budget shortfal...

31Aug

By Bob AscahNo Comments

Budget, Credit Ratings, Government Finances

“Triple Black Swan Event”

Themes from the press conference "No credible date for rebalance" "Doing everything we can to encourage economic growth and development" "Stay tuned for Budget 21-22" "We can no longer afford to be an outlier" "This is not a time to be talking about raising taxes." A focus on delivering public services more efficiently and growing the economy. "Important for Albertans to have a discussion about revenue structure" Albertans will continue to be "self responsible" "We will be very reluctant to shut down the economy" Finance Minister and Treasury Board President Travis Toews presented the UCP government's much anticipated Fiscal Update on Thursday, 27 August. The thin 20-page document was much less substantive than I expected. At his press conference, the Minister presented both the govern...

26Aug

By Bob AscahNo Comments

Budget, Credit Ratings, Government Finances, Politics

Fiscal Update- August 2020

It appears our UCP friends have left it to the last moment to drop the fiscal update and financial accounts on the Opposition NDP who will debate the documents tomorrow.. It could be cynicism or it could be the UCP Cabinet and Caucus still have not agreed among themselves how to position the past year's financial accounts- blaming the NDP- or how do we preach fiscal austerity in a sea of red ink, and how do you budget credibly to a balanced budget in 22-23 or 23-24? How can you make the numbers add up, even with glowing expectations of energy and other investment pouring into the province? The latter point may not be seen as credible by the rating agencies. In reality for the next two years, Alberta, will be a net taker from Confederation, not leading the country in economic growth and dr...

1981- Economic Downturn and Accelerated Projects

16Aug

By Bob AscahNo Comments

Capital Spending, Energy, Fiscal History, Government Finances

1981- Economic Downturn and Accelerated Projects

The fall and winter of 1980-81 was a very unsettling time for provincial politicians. The Alberta public, politicians, and senior public servants were furious at the indifference of federal politicians' plans to redirect oil revenues from producers and the provincial government. Unemployment insurance claims rose from about 10,000 in September 1980 to over 17,000 in January 1981. Alberta's unemployment rate increased from 3.4 per cent in September to 4.5 per cent in January, further causing concern in a province which had recorded rapid economic growth since the early 1970s. In this climate of uncertainty, Treasurer Lou Hyndman had requested his cabinet colleagues to provide suggestions on how to get idle human and physical capital to work again. In these two memoranda from the Hyndman pap...

Hyndman Papers- Budget 1981 preparations

31Jul

By Bob AscahNo Comments

Budget, Economic Data, Government Finances

Hyndman Papers- Budget 1981 preparations

After the National Energy Program was announced, Alberta was about to enter a period of recession that would shape fiscal policy for over the next four decades. As this excerpt from a January 1981 memorandum from Deputy Provincial Treasurer A.F. (Chip) Collins reveals, the province's budget-makers faced a climate of great uncertainty. Over the coming months, Abpolecon.ca will be reporting the internal discussions, at the highest levels of the Alberta government, respecting economic activity and proposed budgetary measures. This tumultuous period offers interesting parallels to what Treasury Board and Finance budget-makers are dealing with. As this excerpt from Provincial Treasurer Lou Hyndman's files illustrates, 1981 was turning into annus horribilis. As the Treasury department prepar...

Heritage Fund loses lustre- Time to rethink its existence-Analysis and Opinion

14Jul

By Bob AscahNo Comments

Agencies, Government Finances, Opinion/Research

Heritage Fund loses lustre- Time to rethink its existence-Analysis and Opinion

The Alberta Heritage Savings Trust Fund (AHSTF), established by Peter Lougheed in 1976, has been seen as a Crown jewel of Alberta’s fiscal management. Recently, the AHSTF long viewed by rating agencies as a vehicle to stabilize finances, has begun to lose its lustre. Is the Heritage Fund merely a relic of Alberta’s golden day in the sun when money poured into provincial coffers? Should the AHSTF be eliminated given the rise of Alberta’s debt. How does the reporting on the AHSTF’s management obscure what should be a laser focus on debt management? (more…)

1Jul

By Bob Ascah1 Comment

Credit Ratings, Government Finances

The next downgrade

On 30 June FitchRatings downgraded the provincial rating from AA to AA- and revised its ratings outlook on long-term debt to negative from stable. Although there was nothing surprising about the downgrade, in view of the Province's deteriorating fiscal position, several statements are noteworthy. First, the report came one day after the Alberta Economic Recovery Plan was announced, Fitch remarked there was a lack of updated financial information. Fitch's initial timing of the report may have been dictated by the expectation that audited financial statements for the last fiscal year would be available. This turned out not to be the case as the Government amended the Fiscal Planning and Transparency Act to give the Government until the end of August to complete the financial statements....

“A National Energy Program”- Hyndman papers

17May

By Bob AscahNo Comments

Energy, Energy, Government Finances, Intergovernmental

“A National Energy Program”- Hyndman papers

The Provincial Archives of Alberta slumbers in obscurity, but the work of its archivists is essential to the conservation and preservation of Alberta's rich social and political history. Lou Hyndman served with Peter Lougheed's ministry from 1971 to 1985 when he returned to the private sector. Hyndman served in many key cabinet positions, including Education, Intergovernmental Affairs, and Treasury. He donated over 100 boxes of records from his time in the provincial government. In this extract, the Deputy Minister of Energy- Energy Resources, Dr. Barry Mellon advises his minister, the Honourable Merv Leitch about impending storm clouds circling over Alberta's energy sector. This revealing memorandum was written six months after Pierre Trudeau won a majority election on 18 Febru...

24Apr

By Bob AscahNo Comments

Banks, Financial Institutions, Government Finances, Opinion/Research

“A Distrust of Everything”- Opinion

In 1982, I interviewed Nigel Gunn, who at that time was the Honorary Chairman of Bell Gouinlock, a well- respected boutique investment dealer specializing in municipal debt. My dissertation (Politics and Public Debt) is about federal public debt management from the 1920s to the 1950s. The one critical point Gunn made in the interview that I will never forget was his statement that when the United Kingdom Treasury abandoned gold in September 1931, "this lead to a distrust of everything." A similar phrase was heard during the 2007-2009 financial crisis, but with Ben Bernanke to the rescue- a student of history- the finger was put in the dike. Here we are again at another financial reckoning. At the present time, our Bank of Canada is following a conventional, yet extraordinary pat...