Newsrelease

April 21, 1997
Edmonton, Alberta

"With the guidance of Albertans we have found a formula for fiscal success and we’re sticking with it. The result will be solid, dependable fiscal management, balanced budgets, maintaining the right priorities and paying down the debt."

Budget ’97 Update — Sticking to a Proven Formula for Fiscal Success

Budget ’97, introduced today by Provincial Treasurer Stockwell Day, and endorsed by Albertans on March 11, contains no surprises for Albertans. With only minor changes, the budget is the same as the one presented on February 11.

"Albertans saw this budget before the election campaign. They knew what we planned to do with their hard earned dollars and they supported the plan with an increased majority. This is the people’s budget — a budget reflecting their priorities, a budget that sticks to what is most important to Albertans. And a budget Albertans support and approve," said the Provincial Treasurer.

Two key changes are included in this budget update. The first is a revised estimate of oil prices for the year, down from US $19 a barrel to US $18.50. This reflects the market fluctuations and dropping prices over the last few months and maintains the government’s commitment to conservative revenue estimates. The other key change is an increase of $20 million in spending on health. This additional funding covers increasing volumes and costs in province-wide services.

Highlights of Budget ’97 Update:

• The budget is balanced.
• The era of major cuts is over. Budget ’97 forecasts a modest surplus of $154 million. Depending on oil and gas prices and corporate taxes, the surplus could be as high as $750 million.
• Alberta's net debt will drop to $3.5 billion by March 1998. That’s based on a revised estimate of a $2.26 billion surplus for the 1996/97 fiscal year.
• Interest costs have dropped by $419 million from their peak in 1994-95. Instead of going to bankers, those dollars now are available to spend on Albertans’ top priorities — health and education.
• We’re spending on the right priorities. Total spending on health and education will go up by $410 million. That increase is partly offset by reductions in other program areas and lower debt servicing costs. The net increase in total spending is $107 million.
• Revenue is budgeted to drop by $2 billion in 1997/98 primarily because of lower oil prices.
• No provincial tax increases, no new taxes, no sales tax.
• Taxes are going down for low and middle income working families. The Alberta Family Employment Tax Credit, started in January 1997, lowers personal income taxes for about 130,000 low and middle income working families with children. First payments will be made in July.

"This is a solid, balanced budget focused on what Albertans told us is most important to them," said the Provincial Treasurer. "Fiscal responsibility continues to be the hallmark of this government. Albertans can expect their government to continue paying down the debt and looking for ways to get better value for the tax dollars it spends. We will channel dollars where they can achieve the best results. Above all, we will continue to live within our means."

For further information, please contact:

Trish Filevich
Director of Communications
Alberta Treasury
(403) 427-5364
webmaster@treas.gov.ab.ca

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