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Plummeting energy prices could drag Alberta into deficit
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| Contributor | Monsieur |
| Last Edited | Monsieur Dec 18, 2008 08:12am |
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| Category | News |
| News Date | Thursday, December 18, 2008 02:00:00 PM UTC0:0 |
| Description | CALGARY - As the country's finance ministers meet to plot an economic course, Premier Ed Stelmach warned Tuesday that deflated energy prices may technically send debt-free Alberta into deficit this fiscal year and force the province to tap its $7.7-billion rainy-day fund.
The premier's economic forecast is a startling reversal of fortune for petroleum-rich Alberta, which analysts predicted only six months ago was on pace for a record surplus of nearly $12 billion this year.
Stelmach said the provincial treasury is being depleted by crashing commodity markets and loss of tax revenue, which could see spending outstrip revenues for the fiscal year - technically producing a deficit that is illegal under provincial law.
To officially avoid red ink in the books and ensure key programs aren't affected, the province's only option may be to draw cash from Alberta's Sustainability Fund, which is designed to cushion Alberta from precipitous drops in resource revenue.
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