Rachel Notley says 'opportunities for savings' must be explored

Premier Rachel Notley says her government is looking at scaling back spending as it grapples with the implications of oil trading less than$40 per barrel.

• No way for Alberta to avoid recession, ATB's Todd Hirsch says

Theprovincemight have less revenue than predicted underthe Prentice government, she told reporters on Tuesday.

"Here's the thing, we're seeing tremendous volatility with the price of oil, and so what we're going to do, is we're going to keep an eye on that, look at what the projections are, we're going to look at where our opportunities for savings are," she said.

"And you'll see us trying to find the right balance there and you'll see what we come up with when we introduce the budget."

The NDPisn't sharing much about what might be in the 2015-16 budget when it comes down in October, but Notley said balancing spending restraint with the obligation to preserve key social services will be a challenge.

"So we're wrestling with finding that balance and you'll see more as we go forward."

The premierreiterated her commitment to go ahead with a royalty review, but she offered a reassurance for the energy industry.

• Rachel Notley says royalty review, tax hike still on table despite low oil

"I think it's fair to say that probably the panel chair and certainly me, in terms of knowing how I'm going to respond when we see that, I'm not going to do anything right now when we have prices so low that would undermine the ability of the industry to recover," she said.

Mild recession

Meanwhile, Todd Hirsch, the chief economist at ATB Financial, says Alberta is in a mild recession this year.

Earlier this summer, Hirsch predicted slow growth for the provincial economy. But he says things have changed.

"I think that we have to sort of capitulate and say that Alberta will be in a modest recession in 2015," he said.

"It's not only oil prices, it's also just the shakiness of stock markets and the shape of the global economy," he said.