You’ve heard a lot this week in the news about the MacKinnon Report or Blue Ribbon Report. You might not have paid attention because you believe it’s just another day in Alberta political theatre, right? Well, not really. This report has recommendations that will affect you directly and indirectly; your jobs, your kids, your health care, grants for your communities, grants for important non profits serving your communities, your tuition and that of your children, and in some cases indirect and direct increases in prices. Who best to deliver this news to Albertans, a History Professor from the University of Saskatchewan working as a consultant for Premier Kenney and the UCP.
The Report and Recommendations of the Blue Ribbon Panel on Alberta’s Finances, call it “Alberta’s version of austerity”, was released on August 3, 2019, in Calgary, Alberta, by a panel led by a History Professor from the University of Saskatchewan, a former Saskatchewan Finance Minister, Dr. Janice MacKinnon.
Alberta Premier Jason Kenney pledged during the spring election to return the province to budget surpluses, bring back jobs, and prosperity to Alberta, but did not explain how. After taking over power, realities have set in, and he is now looking to do what he never promised; cuts, cuts, and more cuts.
It’s no secret that Alberta is spending more than it’s bringing in as revenue, leading to huge deficits as it relies on unpredictable oil and natural gas revenues. When you have a shortage of cash at home, you either work more hours to bring in more money, or you cut down on your cost. Premier Kenney promised to attract more investments to Alberta to pay more taxes and take care of the deficit. This option is out of the window. Another option he has is to increase taxes on Albertans and Albertan businesses. Well, he has chosen to reduce taxes on the businesses, and will cut government cost and grants, in some cases colleges and universities will increase tuition to meet up, an increases passed on to Albertans almost like a tax increase.
Following the Blue Ribbon Recommendations, grants will be lost by non profits, leading to job loses. Alberta Government, one of Alberta’s largest employers will let go employees to reduce government cost, so too will education and health care facilities to meet up with mandatory cuts.
When things are running fine, organizations are pressured to diversify their staff and they bring in token minority employees. When the going gets tough, guess who is the first to be shown the door?
Alberta is in a valley of debt at $27.5 billion and increasing. Premier Kenney wants to reduce it. Guess who pays the price for this debt reduction? Not the businesses with more money. As a matter of fact, the recommendations creates more business opportunities for businesses. If the businesses are not paying, rather making more money from the cuts, then you are left to pick up the slag. It will certainly be tough.
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Read the 26 recommendations from the Blue Ribbon Report below
Recommendation 1: Empower strong, strategic leadership to transform the current health system, using other provinces as models, and engaging nurses, doctors, other health professionals, stakeholders and the public where appropriate . The goal is to establish a health system that achieves better outcomes, provides more appropriate care for Albertans, and approximates the average per capita spending of British Columbia, Ontario and Quebec .
Recommendation 2: Establish the following set of outcomes to measure Alberta’s progress in transforming its health system to reflect the needs of 21st century patients and reduce costs . An external organization, independent of government, should review and report annually on Alberta’s progress in closing the gap with comparator provinces on these outcomes .
Recommendation 3: Make greater use of alternative service delivery for day procedures and other services that do not have to be delivered in hospitals and could be delivered in private or not-for-profit facilities . The use of alternative service delivery should be applied to other areas beyond health .
Recommendation 4: Limit the increasing cost of physician services by providing incentives for physicians to move to Alternative Payment Plans and by renegotiating the agreement with the Alberta Medical Association . Every effort should be made to achieve a negotiated agreement, but the government should also consider its legislative options .
On Education: The Panel recommends that the government should:
Recommendation 5: Work with education stakeholders to decrease the percentage of government funding that goes to administration and governance (currently 24 .6%) to a level comparable to British Columbia (17%) . Recommendation 6: Completely review and revise the current education funding formula to ensure enrolment growth is addressed and to provide incentives for sharing services and achieving better education outcomes for students . On
Advanced Education: The Panel recommends that the government should:
Recommendation 7: Consult with post-secondary stakeholders to set an overall future direction and goals for the post-secondary system along with appropriate governance models.
Recommendation 8: Work with post-secondary stakeholders to achieve a revenue mix comparable to that in British Columbia and Ontario, including less reliance on government grants, more funding from tuition and alternative revenue sources, and more entrepreneurial approaches to how programs are financed and delivered . This includes lifting the current freeze on tuition fees .
Recommendation 9: Assess the financial viability of Alberta’s post-secondary institutions . The government should move quickly to address the future of those post-secondary institutions that do not appear to be viable in future funding scenarios .
On Public Sector Compensation, Bargaining and Size: The Panel recommends that government should:
Recommendation 10: Establish a labour relations framework that creates long-term goals for compensation in line with comparable provinces.
Recommendation 11: End the freeze on non-bargaining staff with respect to providing merit/in range increases to ensure the equitable treatment of all Alberta public service employees (bargaining and non-bargaining) and support the attraction, engagement and retention of qualified staff.
Recommendation 12: Establish a legislative mandate that sets the salary levels for all public sector employees, including all fees and other compensation for insured medical and health services and all third parties, and applies to all negotiations and arbitrations . In the event of a strike, the mandate would form the basis for backto-work legislation . On Capital spending: The Panel recommends that the government should:
Recommendation 13: Bring Alberta’s net public capital stock in line with the average per capita capital stock in the other provinces over the next ten years as part of its balanced budget plans and long-term fiscal sustainability.
Recommendation 14: Stabilize and rationalize the allocation of Capital Maintenance and Renewal (CMR) spending and give priority to CMR in the areas of greatest need in future capital expenditure decisions.
Recommendation 15: Examine its legislative framework for capital funding to municipalities with the goals of: • aligning funding to provincial goals and priorities and fiscal capacity, while further considering funding formulas that require municipalities to share more in the costs of major projects; • adjusting its allocation formulas for grants to municipalities in line with the policy of bringing Alberta’s provincial and municipal per capita capital stock in line with the comparator provinces; • establishing accountability mechanisms and performance measures to monitor the delivery of municipal programs and services and value for money spent, so citizens have the ability to constructively evaluate their local government and their use of tax dollars; and • making better use of federal infrastructure funding, through the Investing in Canada Infrastructure Program (ICIP), as a means of more effectively managing the costs of the Capital Plan .
Recommendation 16: Redefine the government’s inventory of land assets to include the broader public sector and create a definitive policy to clearly define surplus assets and a process for disposal of surplus assets . Providing an increased ability to core government and the broader public sector to dispose of surplus assets can act as an offset to the capital cost of new investments or provide revenue for the province.
Recommendation 17: Form a procurement council which would be a joint effort of government and business/ industry to examine innovation and efficiency in the government’s procurement methods . The intent would be to make it easier to do business with government, enable better access to procurement opportunities for small, medium and large Alberta businesses, and enhance the procurement capacity with government.
Recommendation 18: Refresh its policy on major procurements to look at how to achieve the best value for money for taxpayers . This should include exploring innovative partnerships, examining emerging innovations in other provinces, and reviewing success factors and programs that have worked well in the past . On Program Review: The Panel recommends that the government should:
Recommendation 19: Undertake a comprehensive approach to a program review that includes all departments; agencies, boards and commissions; and the wider public sector . This should provide a principled and thoughtful cross-government approach to looking at the effectiveness and efficiency of government service delivery in the public interest . On Enhancing Alberta’s Competitiveness: The Panel recommends that the government should:
Recommendation 20: Work with industry and Albertans to set a compelling vision for Alberta’s economic future combined with a deliberate strategy to foster an economy that creates jobs and wealth while rebuilding Alberta’s reputation as the best and most responsible place to do business . The strategy should include specific steps to: • develop, transform and empower the public service so it has the culture and capability to deliver on the economic vision and strategy established for the province • make competitiveness and attraction a top priority and send an important signal to industry and investors that Alberta is putting out a “welcome mat” and tackling all the issues facing business, not just taxes • work with industry and post-secondary institutions to develop a long-term plan to ensure Alberta has one of the best and most highly skilled workforces in the world • set clear targets, measure results and report regularly on progress to improve competitiveness On Keeping Alberta’s Budget Balanced: The Panel recommends that government should:
Recommendation 21: Adopt a fiscal rule that limits the annual increases in total program spending to the projected rate of increase in total household incomes in Alberta .
Recommendation 22: Repeal the 1% rule on limits to in-year operating spending increases and replace it with a contingency amount, voted by the legislature and allocated to the Treasury Board and Finance Ministry . A transfer of funds from the contingency to a ministry would only be allowed for a public emergency or disaster or for an unanticipated priority that is clearly in the public interest and cannot be delayed to the next budget.
Recommendation 23: After the budget is balanced, build a formal buffer into its revenue forecasts through the use of a Revenue Forecast Allowance, initially set at 0 .75% of revenue then increasing gradually to 1 .25% over a three-year period .
Recommendation 24: Once the budget is balanced in 2022/23, introduce a legislated plan to eliminate Alberta’s net debt by 2043/44 . Recommendation 25: Establish a fixed budget date.
Recommendation 26: Contract with a reputable independent agency to provide an assessment every four years of Alberta’s fiscal policies, particularly regarding adherence to its fiscal framework and the long-term fiscal sustainability of the province’s fiscal policies . The report should be made public four months before a scheduled election .
