What is Happening?
In order to invest in the future, the Government of Alberta must spend money to build infrastructure and deliver programs. Problems arise when the debt used to finance this spending becomes larger than the financial assets the province owns. This is referred to as net debt. For years Alberta was in a net asset (debt free) position. Starting this year, Alberta will be in a net debt position.
How Does This Affect Me?
When the province crosses into a net debt position, debts are adding up faster than financial assets. This means that the government is taking on more debt than it can afford. Ultimately future generations of tax payers will have to pay back this debt, meaning higher taxes and reduced services.
The Better Way?
The Alberta Party Caucus would limit the amount of non-renewable resource revenues used in operational spending. Any extra revenues would be used to pay off debt or be saved in the Heritage Savings Trust Fund. By doing this, Alberta can once again become debt free and build a renewable financial resource out of non-renewable resource revenues.
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