CALGARY (Reuters) - Canada’s oil-producing province of Alberta, which has been hammered by falling crude prices, will delay plans to balance its budget by one year to 2019-2020, Finance Minister Joe Ceci said on Wednesday.
Ceci said the deteriorating economic situation would make it difficult for the government to keep its previous commitment while protecting public services.
The New Democratic government, which ended 44 years of Conservative rule in a May election, projects a record deficit of up to C$6.5 billion ($4.95 billion) for this year, but Ceci said he would introduce a responsible plan to return to balanced finances in a budget on Oct. 27.
Alberta, the largest source of U.S. crude imports, has not yet approved a budget in 2015 because the previous plan introduced by the former Progressive Conservative government was not adopted before the election campaign.
“Continued low oil prices are putting particular pressure on us here in Alberta,” Ceci said at a news conference in Edmonton. “What I’m saying today is it’s going to take a little longer to reach balance than outlined earlier.”
This is the second time the New Democrats have delayed their plans to balance the budget after revising their platform during the spring election campaign due to an accounting error.
The government took steps in June to increase revenues when it raised the province’s corporate tax rate from 10 percent to 12 percent. But when asked whether he planned further tax increases, Ceci said Albertans should not brace for any big surprises in the budget.
“You’ll have to wait till next week, but I can tell you that the kind of surprises coming will not be substantive,” he said.
Ceci also said the budget would introduce plans to protect public services and stimulate growth by diversifying the province’s economy which has lost thousands of jobs in recent months in the energy sector.
Reporting By Mike De Souza; Editing by Chizu Nomiyama and David Gregorio