NDP needs course on how business works

As Albertans continue to labour under clouds of serious economic uncertainty, those looking to their NDP provincial government...

As Albertans continue to labour under clouds of serious economic uncertainty, those looking to their NDP provincial government must surely have had their confidence shaken last week with a major plan cancellation.

Premier Rachel Notley’s government announced last fall a hairbrained “tax incentive” program which was fundamentally flawed and, more alarmingly, illustrates perfectly the childlike way in which Notley and her government are approaching the recession in Alberta. In essence, the plan, which reads like it was drawn up on a napkin in the Legislature cafeteria, offered what Notley’s government described as $89 million in tax credits in year one for businesses by refunding 10 per cent of a newly hired employee’s salary to a maximum of $50,000.

How was this plan fundamentally flawed? Well, Economic Development Minister Deron Bilous pointed out the aftermath of the plan perfectly Apr. 11 when he announced the NDP was tossing it in the trash. “In response to a great deal of feedback, we have decided not to proceed with the Job Creation Incentive Plan,” said the minister.

Okay, let’s get this straight. The leaders of the government proposed a tax credit that encourages businesses to hire more staff. Done and done. Economic problems solved.

The oversimplification and downright embarrassingly ignorant nature of this idea is all the more disturbing because it was hatched by those holding Alberta’s future in their hands.

When a government with carefully thought out policies and sound fiscal advice is in power, the business community responds. Even in a recession, when conditions are right for business growth, including markets, clear tax structure, available workforce, transportation and more, businesses respond by making profit. When profits increase, the opportunity for growth occurs. Those business owners who are wise carefully plan their growth in increments, being wary of biting off more than they can chew. When the time is right, businesses branch out, and that’s the time they hire new staff.

Prosperity, growth and, yes, creation occur first. Distribution occurs later.

On Sept. 3, 2015 while announcing the plan at a rally and patting herself on the back, Notley said, “People are worried about their jobs, they’re worried about the sustainability of the economy, they’re worried about what happens with the price of oil and it makes perfect sense that they would.” Some months later it’s all cancelled.

On Apr. 3, TD Economics stated in a report that the Alberta economy is doing worse than expected. “The negative economic hit from low oil prices is now expected to deepen in Alberta, Newfoundland & Labrador, and Saskatchewan,” stated four economists who work for TD bank. The province is also approaching the one-year anniversary of the NDP in power in Alberta.

Your NDP government must do a better job of observing the issues facing Alberta’s economy, adapting to those difficulties and overcoming them.

Otherwise, Notley, when listing all the problems Albertans are worried about, can place her leadership and her government at the very top of that list.

 

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