Citizens Centre for Freedom and Democracy
WEEKLY COMMENTARY
"Just Between Us"
February 20, 2006
Alberta's budget surpluses should be used to replace the CPP
It had to happen. I'm just surprised it took so long.
Alberta's provincial Conservative caucus is reportedly split down the middle over what to do with the government's bulging budget surpluses -- spend them or save them.
The Spenders -- mostly from depopulating rural areas -- want the surpluses allocated now to new infrastructure. Especially rural infrastructure. Maybe then more people will stay.
The Savers -- representing mostly expanding urban areas -- think these one-time resource windfalls should be banked for government spending on a future "rainy day," presumably in the Heritage Fund.
I think they're both wrong.
Committing the lion's share to "infrastructure" invites waste, corruption and ill will.
Among politicians it creates a mentality of "So how much do we get rid of this year?" For voters it becomes, "You did something stupid for those guys, now do something stupid for us."
But it's just as questionable to plunk huge surplus sums into the Heritage Fund, the big savings account established by Peter Lougheed's government in 1979.
The Heritage Fund rationale is that its earnings can cushion provincial programs when petroleum prices drop. Lougheed asserted in the Calgary Herald last week it served this purpose in 1986.
But with due respect, the province went sliding into a massive debt anyway, one which has taken Albertans ten years to repay.
The mere existence of the fund lulled both Albertans and the Getty government into a false sense of security, rendering more severe the required cutting back in public spending that Klein began in 1993.
Meanwhile, other Canadians have grumbled all along, "Look at Alberta. They've got more money than they know what to do with" -- an argument all the stronger for being true.
So what should Albertans do?
Easy. Opt out of the Canada Pension Plan, and devote every possible surplus dollar -- for years to come -- to putting a capital base under an Alberta Pension Plan like Quebec's.
That way all surplus funds can belong in a very real and practical sense to the people of the province. And why should young Albertans be stuck with a pension plan as defective as the CPP?
The thing about the Heritage Fund is it's seen as "the government's money." The same would not be so of a universal provincial pension fund.
As Quebec and Ottawa have shown, a public pension plan investment board does not get political interference from anyone. Politicians leave them alone.
It would also give the government a defence against demands for special interest spending -- all those claims that begin, "In a province as rich as Alberta..."
In all cases the government's response, as it was back in the days of deficit-reduction and debt-repayment, would be a standard, "We'd really like to help, but we can't. We need to fund the Alberta Pension Plan."
Finally, it would warn Ottawa to, as Premier Klein put it a while back, "keep your hands off our cash."
Any fiscal aggression from the feds would no longer be seen as an irrelevant quarrel between governments. It would be seen as a direct attack on the personal security of all Albertans, and instant grounds for separation.
In short, an Alberta Pension Plan would protect provincial surpluses from spendthrift politicians, both federal and local, and provide a real benefit from depleting resources for generations to come.
- Link Byfield
Link Byfield is chairman of the Edmonton-based Citizens Centre for Freedom and Democracy, and an Alberta senator-elect.
"Just Between Us" is a feature service of the Citizens Centre for Freedom and Democracy. The purpose of the Citizens Centre is to enhance freedom and democracy by enabling ordinary citizens to become active and effective on important issues outside the normal processes of party politics.
WEEKLY COMMENTARY
"Just Between Us"
February 20, 2006
Alberta's budget surpluses should be used to replace the CPP
It had to happen. I'm just surprised it took so long.
Alberta's provincial Conservative caucus is reportedly split down the middle over what to do with the government's bulging budget surpluses -- spend them or save them.
The Spenders -- mostly from depopulating rural areas -- want the surpluses allocated now to new infrastructure. Especially rural infrastructure. Maybe then more people will stay.
The Savers -- representing mostly expanding urban areas -- think these one-time resource windfalls should be banked for government spending on a future "rainy day," presumably in the Heritage Fund.
I think they're both wrong.
Committing the lion's share to "infrastructure" invites waste, corruption and ill will.
Among politicians it creates a mentality of "So how much do we get rid of this year?" For voters it becomes, "You did something stupid for those guys, now do something stupid for us."
But it's just as questionable to plunk huge surplus sums into the Heritage Fund, the big savings account established by Peter Lougheed's government in 1979.
The Heritage Fund rationale is that its earnings can cushion provincial programs when petroleum prices drop. Lougheed asserted in the Calgary Herald last week it served this purpose in 1986.
But with due respect, the province went sliding into a massive debt anyway, one which has taken Albertans ten years to repay.
The mere existence of the fund lulled both Albertans and the Getty government into a false sense of security, rendering more severe the required cutting back in public spending that Klein began in 1993.
Meanwhile, other Canadians have grumbled all along, "Look at Alberta. They've got more money than they know what to do with" -- an argument all the stronger for being true.
So what should Albertans do?
Easy. Opt out of the Canada Pension Plan, and devote every possible surplus dollar -- for years to come -- to putting a capital base under an Alberta Pension Plan like Quebec's.
That way all surplus funds can belong in a very real and practical sense to the people of the province. And why should young Albertans be stuck with a pension plan as defective as the CPP?
The thing about the Heritage Fund is it's seen as "the government's money." The same would not be so of a universal provincial pension fund.
As Quebec and Ottawa have shown, a public pension plan investment board does not get political interference from anyone. Politicians leave them alone.
It would also give the government a defence against demands for special interest spending -- all those claims that begin, "In a province as rich as Alberta..."
In all cases the government's response, as it was back in the days of deficit-reduction and debt-repayment, would be a standard, "We'd really like to help, but we can't. We need to fund the Alberta Pension Plan."
Finally, it would warn Ottawa to, as Premier Klein put it a while back, "keep your hands off our cash."
Any fiscal aggression from the feds would no longer be seen as an irrelevant quarrel between governments. It would be seen as a direct attack on the personal security of all Albertans, and instant grounds for separation.
In short, an Alberta Pension Plan would protect provincial surpluses from spendthrift politicians, both federal and local, and provide a real benefit from depleting resources for generations to come.
- Link Byfield
Link Byfield is chairman of the Edmonton-based Citizens Centre for Freedom and Democracy, and an Alberta senator-elect.
"Just Between Us" is a feature service of the Citizens Centre for Freedom and Democracy. The purpose of the Citizens Centre is to enhance freedom and democracy by enabling ordinary citizens to become active and effective on important issues outside the normal processes of party politics.
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