Ministerial Mandate Letters highlight upcoming showdowns between Alberta and Ottawa

Contributed by Free Alberta Strategy

After every election in Alberta, once the new government is formed and Cabinet has been selected, the Premier provides documents called mandate letters to each of their new Cabinet Ministers. These mandate letters outline the government’s priorities and policy objectives, as well as the Premier’s expectations, for each Minister’s performance in their respective roles. It is also common for these mandate letters to be released publicly, giving us as the public an early look at where the government is likely headed in the coming months and years. Over the last few days, the first of these mandate letters have been released, so we wanted to bring you a few of the highlights.

The constant theme throughout the letters is a very clear message to the federal government that Alberta will be flexing its muscles on the national stage in the coming four years. In particular, the two highest-profile Ministries – namely Finance and Energy – got mandate letters that put the federal government right in their crosshairs.

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Drumheller-Stettler MLA Nate Horner is in Cabinet as Finance Minister and has been tasked with looking at the establishment of an Alberta Revenue Agency and an Alberta Pension Plan.

These are both fundamental concepts of the Free Alberta Strategy, and both are strongly opposed by the New Democrats led by Rachel Notley.

The concept of an Alberta Revenue Agency isn’t as scary as most of the opposition is making it out to be.

Quebec already has a Quebec Revenue Agency that collects all provincial tax.

Saskatchewan just passed the Saskatchewan Revenue Agency Act, which gives them the ability to defend Saskatchewan’s economic autonomy, industries and jobs from federal intrusion and constitutional overreach.

Also, Alberta already collects provincial corporate tax through the Tax and Revenue Administration department.

So, in some ways, the Alberta Revenue Agency already exists – we just need to expand its mandate to include other types of taxes other than corporate tax.

This move would also provide greater flexibility for the province when it comes to provincial tax collection policy.

As a bonus, once this is done, we will then be able to join Quebec in lobbying the federal government for the ability of provinces to collect federal taxes.

This is something that Quebec has been pushing for for quite some time, and while they haven’t made any progress in convincing the current federal Liberal Party, several recent Conservative Party leaders have expressed support for the idea.

With regards to an Alberta Pension Plan, there is an actuarial report due to be released sometime soon that has studied this issue.

“It’s something that’s been outlined as a potential opportunity and something that we need to really flesh out and get into the numbers and make sure that Albertans understand,” said Horner.

We’ve pointed out here a few times that Albertans contribute more into the Canada Pension Plan than we take out in benefits.

In essence, Ottawa is using the CPP as just one more way to subsidize the rest of Canada with our money.

We anticipate the report – when it is released – will point out that due to our young demographics and provincial income levels, an Alberta Pension Plan will give us the ability to decrease contributions while maintaining the same benefits to our seniors, keep contribution levels the same while increasing benefits to our seniors, or some combination of the two.

Alberta’s exit from the Canada Pension Plan would also leave a huge hole in the national fund – one that would require premiums to dramatically increase in the rest of the country to make up for the subsidy they’ll no longer be getting from Albertans.

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Fort McMurray-Lac La Biche MLA Brian Jean steps into the crucial role of Energy and Minerals, a very fitting role given the riding he represents is the very heartland of the energy industry.

Jean will face off against a federal government that has been violating provincial natural resource jurisdiction ever since its election, and he will be expected to stand up to the politicians in Ottawa who are seeking to systematically decimate our natural resource industry.

Specifically, Jean is tasked with “defending Alberta’s energy interests against federal overreach and developing strategic alliances with other provinces to deal with energy-related issues.”

Recently, Federal Environment Minister Steven Guilbeault has gone so far as to state his belief that oil and gas production is likely to be reduced by 75% by 2050.

And given Justin Trudeau’s plans for a Just Transition / Sustainable Jobs Act, a net-zero electricity grid by 2035, an emissions / production cap on oil and gas at the end of this year, and more, we should believe him when he says he intends to try.

Considering the impact the aggressive climate ambitions of the federal government are anticipated to have on the national economy, prioritizing the defence of the industry on a jurisdictional basis is absolutely essential to ensure the future of Alberta.

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Horner, Jean, and the rest of Cabinet are about to become willing participants in the biggest fight of their political lives.

They will be expected to stand up for Alberta against the next wave of federal attacks and wrest control of our future back from Ottawa.

Here at the Free Alberta Strategy, we will be pushing the government to stay resolute in the face of these attacks, and to implement our ideas and proposals.

We’ve seen once before that a government in Alberta can be elected on a strong mandate to stand up to the federal government but back off when left-wing activists and media pressure them to stop.

That’s why we need to keep the pressure on to keep going, and make sure this government follows through.

To help us keep the pressure on, please consider making a donation to the Free Alberta Strategy:

DONATE

We need your support to continue our research, policy analysis, grassroots organizing, and communications efforts.

Thanks for your support!

Regards,

The Free Alberta Strategy Team

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DONATE has two key objectives:

Establishing complete Provincial Legislative Sovereignty within Canada
Ending Equalization and Net Federal Transfers out of Alberta

The Strategy accomplishes these two objectives through a series of legislative and other policies that must be implemented by Alberta’s Provincial Government

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By Jason Clemens and Elmira Aliakbari

The challenge of GHG emissions in 2050 is not in the industrial world but rather in the developing world, where there is still significant basic energy consumption using timber and biomass.

The new Memorandum of Understanding (MOU) between the federal and Alberta governments lays the groundwork for substantial energy projects and infrastructure development over the next two-and-a-half decades. It is by all accounts a step forward, though, there’s debate about how large and meaningful that step actually is. There is, however, a fundamental flaw in the foundation of the agreement: it’s commitment to net zero in Canada by 2050.

The first point of agreement in the MOU on the first page of text states: “Canada and Alberta remain committed to achieving net zero greenhouse gas emissions by 2050.” In practice, it’s incredibly difficult to offset emissions with tree planting or other projects that reduce “net” emissions, so the effect of committing to “net zero” by 2050 means that both governments agree that Canada should produce very close to zero actual greenhouse gas (GHG) emissions. Consider the massive changes in energy production, home heating, transportation and agriculture that would be needed to achieve this goal.

So, what’s wrong with Canada’s net zero 2050 and the larger United Nations’ global goal for the same?

Let’s first understand the global context of GHG reductions based on a recent study by internationally-recognized scholar Vaclav Smil. Two key insights from the study. First, despite trillions being spent plus international agreements and regulatory measures starting back in 1997 with the original Kyoto agreement, global fossil fuel consumption between then and 2023 increased by 55 per cent.

Second, fossil fuels as a share of total global energy declined from 86 per cent in 1997 to 82 per cent in 2022, again, despite trillions of dollars in spending plus regulatory requirements to force a transition away from fossil fuels to zero emission energies. The idea that globally we can achieve zero emissions over the next two-and-a-half decades is pure fantasy. Even if there is an historic technological breakthrough, it will take decades to actually transition to a new energy source(s).

Let’s now understand the Canada-specific context. A recent study examined all the measures introduced over the last decade as part of the national plan to reduce emissions to achieve net zero by 2050. The study concluded that significant economic costs would be imposed on Canadians by these measures: inflation-adjusted GDP would be 7 per cent lower, income per worker would be more than $8,000 lower and approximately 250,000 jobs would be lost. Moreover, these costs would not get Canada to net zero. The study concluded that only 70 per cent of the net zero emissions goal would be achieved despite these significant costs, which means even greater costs would be imposed on Canadians to fully achieve net zero.

It’s important to return to a global picture to fully understand why net zero makes no sense for Canada within a worldwide context. Using projections from the International Energy Agency (IEA) in its latest World Energy Outlook, the current expectation is that in 2050, advanced countries including Canada and the other G7 countries will represent less than 25 per cent of global emissions. The developing world, which includes China, India, the entirety of Africa and much of South America, is estimated to represent at least 70 per cent of global emissions in 2050.

Simply put, the challenge of GHG emissions in 2050 is not in the industrial world but rather in the developing world, where there is still significant basic energy consumption using timber and biomass. A globally-coordinated effort, which is really what the U.N. should be doing rather than fantasizing about net zero, would see industrial countries like Canada that are capable of increasing their energy production exporting more to these developing countries so that high-emitting energy sources are replaced by lower-emitting energy sources. This would actually reduce global GHGs while simultaneously stimulating economic growth.

Consider a recent study that calculated the implications of doubling natural gas production in Canada and exporting it to China to replace coal-fired power. The conclusion was that there would be a massive reduction in global GHGs equivalent to almost 90 per cent of Canada’s total annual emissions. In these types of substitution arrangements, the GHGs would increase in energy-producing countries like Canada but global GHGs would be reduced, which is the ultimate goal of not only the U.N. but also the Carney and Smith governments as per the MOU.

Finally, the agreement ignores a basic law of economics. The first lesson in the very first class of any economics program is that resources are limited. At any given point in time, we only have so much labour, raw materials, time, etc. In other words, when we choose to do one project, the real cost is foregoing the other projects that could have been undertaken. Economics is mostly about trying to understand how to maximize the use of limited resources.

The MOU requires massive, literally hundreds of billions of dollars to be used to create nuclear power, other zero-emitting power sources and transmission systems all in the name of being able to produce low or even zero-emitting oil and gas while also moving to towards net zero.

These resources cannot be used for other purposes and it’s impossible to imagine what alternative companies or industries would have been invested in. What we do know is that workers, entrepreneurs, businessowners and investors are not making these decisions. Rather, politicians and bureaucrats in Ottawa and Edmonton are making these decisions but they won’t pay any price if they’re wrong. Canadians pay the price. Just consider the financial fiasco unfolding now with Ottawa, Ontario and Quebec’s subsidies (i.e. corporate welfare) for electric vehicle batteries.

Understanding the fundamentally flawed commitment to Canadian net zero rather than understanding a larger global context of GHG emissions lays at the heart of the recent MOU and unfortunately for Canadians will continue to guide flawed and expensive policies. Until we get the net zero policies right, we’re going to continue to spend enormous resources on projects with limited returns, costing all Canadians.