On Thursday, Oct. 24, just a day after the federal election, the United Conservative Party (UCP) declared war on Alberta’s working class. The government’s first budget contains $1.3 billion in cuts, slashing everything from public sector wages to vehicle registration fees, forcing the working class to tighten their belts and open their wallets. Meanwhile, corporate taxes have been slashed by a third.
The timing of this budget is no coincidence. Doug Ford’s regime in Ontario has destroyed the Conservative party’s popularity with spending cuts, and as punishment, federal Conservative leader Andrew Scheer placed Ford under house arrest for the duration of the election campaign. In a similar way, UCP Premier Jason Kenney postponed his budget attacks so as not to hurt Scheer’s chances. As a reward Kenney was invited to campaign with Scheer, even in Doug Ford’s own neighborhood! But now that the federal ballots have been cast, nothing is preventing the UCP from taking from the needy and giving to the rich.
The authors of the budget state their intention to follow “the principles of living within our means.” But upon hearing this we should ask: who needs to live within their means?
According to the government, not the oil barons and other capitalists. In total, the province will lose out on $4.5 billion in revenue over the next four years because of slashed corporate taxes. Finance Minister Travis Toews said the tax cut will incentivize businesses to invest, and will actually increase revenues by $4 billion by the end of 2023. But this claim is closer to fantasy than reality. Investment in Alberta — especially in the oil patch — is tied to world oil prices. Husky Energy alone profited an extra $233 million from the UCP’s corporate tax cut in its second quarter. In response to Kenney’s budget, Husky CEO Rob Peabody said “we really appreciate” the tax cuts, before proceeding to lay off hundreds of workers in Calgary. These trickle-down economic measures will not bring investment and prosperity to Alberta. Husky itself is not increasing capital spending in Alberta. Instead of a return to the “Alberta Advantage,” these tax cuts are coming out of public services, forcing the working class to “live within their means” while the capitalists take more and more.
Kenney’s austerity package leaves no stone unturned in claiming jobs and livelihoods, however. The UCP promised to bring jobs to Alberta, but now they are cutting jobs and salaries for public sector workers. About 2,100 positions, or 7.7 per cent of all public sector jobs, will be eliminated over the next four years largely through hiring freezes, with no raises on the horizon for the next three years. With inflation, a freeze is always a cut. With cuts across the board there will be a “trickle down” of layoffs in public institutions that will be forced to cut jobs due to loss of funding. The cuts have already started, with the University of Calgary laying off 25 support staff members.
The UCP have already made it clear what they plan on doing if public sector workers challenge the government when they broke public contracts with Bill 9. They will no doubt attempt to legislate and break any labour dispute when they force public sector workers to do more with less. Front-line workers are already stretched thin. Increasing their workload will result in lower quality services in health care, education, etc.
One of the most striking aspects of the budget is its attacks on education. Although the UCP promised to increase funding to K-12 level education, the current budget will freeze funding for the next three years which will function as a prolonged cut, and a significant cut at that. K-12 enrollment is expected to grow by as much as 15,000 per year. Even before taking inflation into account, school boards will be receiving around $200 less per student yearly under the new budget.
Alberta is already struggling with a well-documented issue of overinflated class sizes. In accordance with a 2003 report by the Alberta Commission on Learning, the provincial government has put into place guidelines that recommend no more than 17 students per class from kindergarten to grade three; 23 from grades four to six, 25 for grades seven to nine, and 27 for Grades 10 to 12. Fifty-seven per cent of schools in the province fail to meet this standard. The situation is especially bleak for younger students, where a shocking 81 per cent of kindergarten to Grade 3 classes exceed these guidelines. Last September it was revealed that classes in one Calgary high school had to be held in the hallway!
Post-secondary students have been heavily targeted as well. The government will cut operating grants for universities and colleges by up to 7.9 per cent and eliminate the tuition freeze. They are forcing students to either drop out or pay an extra seven per cent a year in tuition, which will add even more to the enormous burden of student debt in Canada, now at $28 billion and growing. Not only will students be forced to take on loans that they cannot pay off for decades, the UCP is also raising interest on those student loans and eliminating tuition tax credits. This is a significant drain on post-secondary students and will certainly mean many students will be forced out of school. However, Christian, private, and charter post-secondary schools favoured by the rich will not face budget cuts.
The UCP couldn’t help but boast about their plans for health care while announcing their budget. Health Minister Tyler Shandro stated the UCP is, “delivering on our promise to maintain health funding, in fact we’re increasing it by one per cent(!).” Similar to their plans for education, while this is a formal raise in funding, it does not nearly keep up with the needs of the health-care system. Alberta sees an annual growth rate of approximately 70,000 new residents and has an aging population. From 2018 to 2019, the number of seniors grew 5.4 per cent, compared to the national average of 3.7 per cent. It is impossible that an increase in health spending as modest as one per cent will be nearly enough to accommodate such significant population growth as well as increased need for senior-orientated health care.
Likewise, by March 2020, coverage provided for all non-senior dependants by the Alberta Seniors Benefit Drug Program will be put to an end. NDP Health Critic David Shepherd has pointed out that up to 46,000 people could lose drug coverage. Assured Income for the Severely Handicapped, a program that provides financial and medical coverage for those with medical conditions that prevent them from earning a living, will no longer have their funding adjusted for inflation. Recipients of AISH already struggle to make ends meet on only around $1,600 a month. To cut their benefits only increases the hardships of some of the most vulnerable in our society.
Municipal governments were not safe from the cuts either. Municipalities will lose $236 million in grants over the next four years, the majority of which goes to Calgary and Edmonton. The budget has left these city councils scrambling to figure out how to make up the extra money. Edmonton alone is now in the hole by $150 million and the city is being forced to delay or outright cancel infrastructure projects including a new hospital and multiple LRT lines.
If it wasn’t enough to pillage public service for corporate profit, the UCP have invented 101 new ways to nickel-and-dime workers into paying more money to the government. In 1999 Jason Kenney criticized then-Liberal prime minister Jean Chrétien for partially deindexing tax brackets. He described this policy as a “pernicious, invidious tax bracket creep which sucks about a billion additional dollars out of the pockets of middle-income Canadians every year.” Kenney and the UCP are now pursuing the exact same policy which increases personal income taxes. Other schemes include higher fees to register a vehicle, higher museum admission fees, higher tobacco and vape taxes, eliminating the price cap on electricity, and even a levy on short-term rentals like Airbnb which will be passed on to the consumer. The UCP is also implementing a $500 application fee for the Alberta Immigrant Nominee Program, where there had been no fee previously.
Following the budget’s release, Guy Smith, president of the Alberta Union of Provincial Employees (AUPE), said that, “if that’s what Jason Kenney and his government want, a war with public sector workers, it’s a war he’s going to get.” Kenney’s war on the working class is only in the first phase, and the words of Smith need to be followed with action. Since Kenney broke public contracts with AUPE, the union has been organizing informational pickets every few weeks which bring out hundreds of militant workers. But it will take a lot more to stop these cuts. In his pre-budget address Jason Kenney said, “no number of protests or political attacks are going to push us off course.” The working class of Alberta has more than enough power to make Kenney eat his words. If the AUPE, representing over 95,000 public sector employees in the province organized a mass strike against this budget, the government would be ground to a halt and be forced to retreat. We cannot sit down and take these cuts for the next four years. Kenney’s government needs to be stopped in its tracks immediately.
