25 Feb IMPACT: How Government Decisions Affect Alberta’s Fiscal Sustainability
A copy of the report How Government Decisions Affect Alberta’s Fiscal Sustainability can be found here.
In times of economic hardship, the people of Alberta rely on their government to keep the province strong. Both the revenue and the expenditure sides of government must be approached with care, prudence, and a conservative attitude. This paper discusses the government’s plan, and offers critiques and suggestions on how to make government finances better.
With the recent release of the third quarter fiscal and economic update, it has become apparent that the decisions, policies and forecasts used by the Government of Alberta must be made with accuracy. The overly optimistic forecasts made in Budget 2015 have placed the future generations of Alberta in jeopardy with increased levels of debt, and a lack of a plan to repay said debt.
First, the Alberta Party Caucus examined the literature of the three major credit rating agencies. This analysis provided insight into the facets which third parties consider when issuing a credit opinion. Next, the Alberta Party Caucus looked closely at the government revenue and expenditure projections. This scrutiny provided insight into the best practices for government forecasting and budgetary planning. Finally, the Alberta Party Caucus inspected the impacts recent government decisions have had on the Canadian bond market. By studying the factors responsible for bond pricing, decision makers and the public can be aware of the choices that need to be made in order to keep Alberta attractive for investment.
This analysis led to various recommendations which, if implemented, would strengthen the financial position of the province. It is up to government officials, community leaders, and the public to take charge and put these recommendations in place.
A copy of the report can be found here.