Premier prepares Albertans for spending cuts in pre-budget speech

Program spending will be trimmed by 2.8 per cent and capital projects will be delayed or scaled back when Alberta's United Conservative Party government introduces its first budget on Thursday.

"This will be a challengingbudget. It will not be easy. Some programs will be askedto do more with less," Premier Jason Kenney said in a provincewide address Wednesday evening.

"Some ineffective programs will be eliminated altogether. Some infrastructureprojects will be delayed or scaled back. Not because we want to do that. Because we have to do that. These are necessary decisions and I will argue that they are long overdue."

Kenney said the cuts will be nothing like those rolled out in 1993 by the government of former premier Ralph Klein, when spending was cut by 20 per cent.

The impact on public service jobs will be "modest," Kenney said, with staff reductions coming mainly through attrition. The government will maintain spending on health and educationand will fund increases for mental health and addictions.

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Albertans have been warned to expect financial restraint since the UCP won a majority government in the April election.

A week after taking office, Kenney announced that Janice MacKinnon,a former Saskatchewan finance minister, would chair a "blue-ribbon panel" on Alberta finances. The panel was instructed to look at government spending, not at possible changes to taxation.

The report, which was released to the public in early September, urged the province to cut annual spending on operations by at least $600 million and "substantially reduce" funding for capital projects.

The panel recommended measures ranging from legislated salaries for public sector workers to closures of some post-secondary institutions to get Alberta's debt under control.

Kenney reminded Albertans that his government was given a mandate to take action on the province's finances. He also addressed the pushback that is likely to follow in the days after the budget.

"No number of protests or political attacks are going to push us off course," he said.

The budget won't just be about cuts. Kenney said his government will also introduce plans to boost the provincial economy and create jobs.

That includes details about diversification programs in petrochemicals, tourism, agriculture and the film industry.

NDP Leader Rachel Notley predicted a2.8 per cent budget cut would be deep and painful.

"It means that things like housing, environmental monitoring, services for people with disabilities and preserving safety in our communities will be cut by almost 10 percent," Notley said.

She responded to a plan by Kenney to de-index benefit programs such asAISH (Assured Income for the Severely Handicapped), which is linked to inflation.

"That's not fairness. That's not standing up for regular Albertans," Notley said.