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Ask Danielle - Answers to Monday's questions

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  • Ask Danielle - Answers to Monday's questions

    C2E Questions for Danielle Smith / June 14th

    What is the WRA position on LRT expansion funding for Edmonton? We would like to have a NW line to St. Albert limits by 2019 and the west/southeast line done by 2016.
    Good: LRT, Downtown, Post-Secondary Bad: Chronic Homeless People, Bad Spellers

    My answer on LRT expansion funding: Wildrose believes we need a new municipal financing model. The current model forces cities, towns, counties and MDs to go begging cap-in-hand to the province for key infrastructure projects in their communities. It pits one municipality against the other and causes the provincial government to make decisions on the basis of political lobbying and vote buying, rather than on priority. Provincial MLAs should not be picking and choosing among their favourite projects. The province should create a financing model that allows each municipality to keep more of the revenues generated in their communities so each municipality can fund their own priorities. A Wildrose government would look at doing this through such methods as allowing the municipality to keep all of the property tax revenue generated in their community for municipal purposes, looking at the AUMA model of shared funding on a predictable formula based of per capita and km of roads, or rebating back to each municipality a portion of the personal income tax revenue generated there. We would not continue to fund municipalities on the current tax-and-transfer model.

    Hi Danielle, thanks for participating.

    Albertans have been promised "smaller, more efficient government" for a long time, only to see it get bigger and more bloated by the day. Does the Wildrose Alliance have the will to empower front-line employees, reduce middle management, shrink government, and put those savings back in the hands of hard-working Albertans? If yes, be specific on how this will happen and by how much. If no, why?

    Hold on a moment, my give-a-damn is broken.

    My answer on empowering front line workers: In my speeches I often refer to the need to empower frontline workers and reduce the layers and layers of middle management that are interfering with timely, flexible decision-making. I have heard many stories from people who work in the system of having as many as 8 layers of managers to go through to get even simple decisions made. Remember when the province announced the $44 million in managers’ bonuses? Well the good news is now we know how many managers there are in the civil service. There were 6700 managers who qualified to receive those bonuses and about 30,000 civil servants in total, or about 23,000 frontline workers. That means we have on average 1 manager supervising 3 employees. We need to get higher performance government by following the Westjet model. Westjet empowers frontline workers to make decisions, which means they need a whole lot fewer managers. At Westjet they have 7500 workers and 300 managers, or a manager to worker ratio of 1:25. If we even did half as well as Westjet we would be able to eliminate thousands of middle managers without cutting frontline nurses, doctors, teachers and education assistants. The key is to identify the new management model and move towards it as managers start retiring and leaving the civil service through natural attrition. There is an opportunity to do this as the population ages and retires over the next decade. I think it will result in a much more rewarding work environment for the civil service too.

    Ms Smith

    What is the Alliance parties position on royalties? Would you raise or lower them?
    What is the Alliance party position on utility deregulation? Do you support it?
    Does the Alliance party believe in unrestarined growth, or would you provide restraint if necessary?

    My answer on royalties: We needed to change the oilsands royalty structure. The royalty of 1 percent paid until capital was paid out was not seen to be fair, by those in the industry and those outside of it. There was a widespread perception that energy companies in the oilsands were adding capital to continue to stretch out the time period for the 1 percent rate as long as possible. This needed to be fixed. However, the government did not need to change the royalties on conventional oil and gas. These rates started out at maximum of 30 per cent charged from the first dollar that was earned. The NRF changed this to a top rate of 50 per cent starting at the first dollar and Alberta saw the assessment of its overall investment climate go from one of the best in the world to one of the worst. In the meantime, capital markets and commodity prices collapsed, shale gas emerged as a game changer, and the province has since lost billions of dollars in land sale revenues, lost drilling activity, and the cost of new incentives to attract investment back. My guess is we would have had $5 billion to $10 billion more in provincial revenues if they had kept these rates exactly the same as they were under Ralph Klein. Seven major adjustments later, the government has finally created a structure that mirrors the oilsands (a low rate (5%)charged until capital costs are recovered then the rates go up to as high as 36 per cent on gas and 40 per cent on oil). It is definitely and improvement, however, the punitive NRF rates are still in effect until the end of the year. This continues to pummel the small junior oil and gas exploration sector, who continue to be deprived of the capital they need to continue their drilling programs. The government made an absolute mess of it and we’re not out of the woods yet.

    My answer on deregulation: We support a market system for the generation of power, but the province made some key errors in the process of deregulation and in its market design. There is no location pricing for generators, so it doesn’t matter how far away they locate from their end consumers, consumers pay 100 per cent of the cost of new transmission lines. As a result, the AESO now has a plan to build up to $16 billion in new transmission that will create great individual expense to industrial and residential ratepayers. The system is also not flexible to demand response. In some markets, when prices get too high, large industrial users can sign a contract to be paid to go offline so it will bring prices down. The market design also does not allow for effective use of smart metering, because it does not give real time prices to allow for consumers to respond by powering down. There is also a fundamental disconnect between generators and consumers. Without a guaranteed price or long-term contract with a retailer, generators are left shouldering excessive risk in selling into the spot market. There may be a need for more vertically integrated companies, like Enmax, or feed-in tariffs, or power purchase agreements to be able to overcome this barrier.

    My answer on government restrained growth: The Wildrose does not believe that governments should be trying to slow the economy down. During my economics degree we did lots of modeling in class about how government could experiment with fiscal policy to tinker with revving up or restraining the economy. In the real world, it’s quite different. When government acts to slow down the economy it means workers get laid off, graduating students can’t get jobs, businesses go bankrupt, families lose their homes, and we witness an increase in domestic abuse, drug addiction, homelessness and suicide. I would rather deal with the problems associated with a boom than the problems associated with a bust. Governments should not be playing around this way with people’s lives.

    Currently, the Alberta government is spending hundreds of millions of dollars building new schools in Calgary in Edmonton, when there is already a surplus of schools and surplus space available that kids could instead fill. It makes no sense to close a school in a mature neighborhood to fund the building of a new school in a new suburb, move the kids to the schools not the schools to the kids. This will encourage recycling of mature neighborhoods something that is desperately needed to stop the donut effect that is occurring in both cities.

    What is the WRA position with respect to new school building versus utilizing existing schools?

    Where does the WRA stand on sprawl in general - many cities throughout the world are implementing green belts (or did long ago - e.g. London). Ontario has taken greenbelt measures to reduce sprawl (e.g. ). Would WRA support measures on a regional basis to encourage more densitifcation in Alberta to help preserve farm land, green-space, and revive inner cities?

    My answer on new school building: Wildrose believes that funding should follow the student for both operational and infrastructure grants and that local school boards should make the decisions on whether to build or bus. Generally speaking, I sympathize with the school board’s view that they need to build schools where the children are.

    My answer on greenbelts: If government is going to deny development on land by creating greenspace, then they have to pay full, fair and timely compensation. The Landuse Framework is a devastating piece of legislation from the perspective of private property rights. It allows Cabinet to approve 5 year regional plans and determine what land uses will be permitted and what land uses will be prohibited on Crown land and on private land. It allows the Cabinet to extinguish landowner and leaseholder rights without compensation and without recourse to the courts. This is unacceptable in a Western liberal democracy. If property value is diminished for public use, the public must pay for the benefit and the landowner must be left whole.

    Hi Danielle.

    What's your policy on transparency in the office following the rampant spending by members of the PC party? What initiatives are you offering to fight overspending and political pork lining?

    Since baby boomers are now becoming seniors, we're going to see a major need to increase health care services and government run seniors centres. Can you please convince me why privatization is better for people on limited budgets or pensions who need government assistance to do stuff like live or eat?

    In light of the BP fallout and their reluctance to adhere to basic maintenance, do you think it's wise to let the oil industry police themselves? How do you feel about the plans to increase production up there by 51%, and what's going to be the province's cut under your policies?

    Feel free to just answer one and I'll revise my questions accordingly.

    PS: How tight are you with Preston Manning?

    My answer on transparency: We agree with Liberal Leader David Swann on the need for more transparency, including MLAs posting their expenses online. We also will be releasing our Task Force report on Pay and Perks at our June AGM in Red Deer. We believe that MLAs and Cabinet ministers should be paid what ordinary, average Albertans think they should be paid. Compensation packages should be consistent with private sector comparisons. Right now, these perks are way too rich.

    My answer on privatization in health care: Our members have said they want us to make changes under the umbrella of the Canada Health Act. We need to fix health care by looking at systems that are similar to ours but actually work. There are seven countries in the world that are publicly funded, universal, where they spend as much or less than we do and they have eliminated waiting lists. These are countries such as Austria, Belgium, France, Germany, Luxembourg, Switzerland, and Japan. We need to look at the best practices in those systems and adopt them here. Private delivery of publicly funded health care is not offside with the Canada Health Act. In fact, delivering surgeries in smaller, specialized surgical centres – whether public or private – will be key to improving performance and containing costs. Competition works. Monopolies don’t.

    My answer on BP and “self-policing” in energy sector: The oil industry does not police itself in Alberta. I would put the environmental record of Alberta’s energy producers up against any hydrocarbon producing country in the world. We need smart regulations that are focused on achieving the outcomes we want; we have to move away from a regulatory environment that is focused on process and creates unnecessary red tape. Other provinces – BC, NS, NF – have shown that you can streamline regulatory process without compromising consumer safety, environmental safety, and workplace health and safety. Delays do not automatically equate to due diligence.

    My answer on increasing production by 51%: Alberta is a resource producing province. That’s what we do well and under a Wildrose government we will continue to celebrate our industry’s achievements in producing resources in a way that meets the needs of our economy and with continuous improvement in environmental performance. All development has some impact on the environment. The challenge for our industry is to minimize the harm during the development phase and have a realistic plan to clean it up after. Alberta will increase its revenue take by creating a stable, predictable investment climate that attracts industry to our province. We will ensure a fair return for Albertans (as owners of the resource), fair compensation for landowners who are impacted by the development, and a fair return for energy companies who are taking 100 per cent of the risk, so they can continue to invest in our province and create wealth.

    My answer on Preston Manning: I admire Preston Manning. His Manning Centre for Freedom and Democracy is doing a great job helping to train conservatives in campaign tactics. As head of an independent charity he remains non-partisan.

    A while back you were quoted as saying something about the sciences (nanotechnology) not being relevant to Alberta economy unless it benefits directly our core, established businesses.

    Would you please clarify your position regarding Alberta participation in education particularly the post secondary including technical and trade schools and universities?

    Also, please comment on the need of Alberta to diversify its economy and any participation by the government in that endeavor.

    Thank you,

    My answer on nanotechnology: I do not believe that government should be picking winners and losers in an economy. That applies as much to nanotechnology as it does to giving subsidies to the coal industry. It is not up to me as a politician to determine what the next business success will be. That’s the job of entrepreneurs – the true visionaries in our society. My job as a politician is to work to create the kind of investment climate that will be attractive to investors: a competitive tax regime, a streamlined regulatory environment, fair consistent rules that treat all investors the same, respect for contracts and private property rights, good infrastructure with access to markets, graduates with the skills and knowledge needed to find jobs in Alberta, a tax environment that encourages R&D investment, and enough support for university research to attract the best minds to our province. However, when the government intervenes directly to subsidize particular sectors or particular companies, they are creating an unlevel playing field. This type of interventionist approach has resulted in billion dollar boondoggles for taxpayers in the past. We don’t believe in corporate welfare.

    My answer on post secondary: Every Alberta student who meets the entry requirements for their program should be able to be access a program in this province. Last year, it is my understanding that 7500 qualified students were turned away from NAIT. If this continues, it is going to impair our ability to keep up with the demographic changes that will have a major impact on our economy as the Baby Boom generation leaves the workforce.

    Hello Ms Smith,

    I have a number of relatively unrelated questions:

    Does the Wildrose Alliance have a commitment to high-quality public architecture?

    State-owned companies like Sinopec and Statoil have bought into our oilsands. While these foreign governments profit from our oilsands, Albertans see fewer public services from their own gov't. In your opinion, is this fair or equitable?

    What will a Wildrose Alliance government do to help revitalize Edmonton's downtown?

    Are you more fiscally conservative, or socially conservative?

    In your opinion, what is the number one challenge facing the world today?

    As a method of international politics, would you advance the realist, liberal, or constructivist theory?

    What are the three best qualities about Edmonton, in your opinion?

    My answer on high quality public architecture: I’m not quite sure what this means. I think we need to look at P3s where they make sense.
    Danielle’s answer on Sinopec and Statoil: Companies that invest in Alberta have to follow the same rules and regulations as Alberta. They hire Alberta workers who pay taxes to the Alberta government. They pay royalties to the Alberta government that go to subsidize our delivery of social programs. Many of these companies use their profits to further invest in Alberta. There is no need to fear foreign investment. It creates jobs, wealth and prosperity that benefits all of us.

    My answer on revitalizing Edmonton’s downtown core: As already mentioned, we would change the funding model for municipal financing to ensure every municipality has the revenues they need to fund their own priorities. Revitalizing Edmonton’s downtown core is a job of Edmonton city council. A Wildrose government would respect local autonomy.

    My answer on fiscal versus social conservativism: I believe that government’s main job is to protect our individual liberties: Freedom of speech, freedom of religion, freedom of assembly, freedom of association and economic freedom, underpinned by a respect for private property rights. I further believe that individuals, families and communities should be free to govern themselves in their own way without a whole lot of interference from the legislature, and that government decision-making should be decentralized as much as possible.

    My answer on the number one challenge in world today: I am a provincial politician, not a national or international politician, so my interests remain focused on what’s best for our province. Our main challenge here is to make Alberta a leader once again - on fiscal policy, health policy, education policy, property rights policy, and democratic reforms.

    My answer on international theory: I’m a provincial politician, so I try not to stray too far from my areas of expertise. I believe local politicians are better able to make decisions in the best interests of those they serve. I’m not interested in having foreign, unelected bureaucracies dictate Alberta’s energy or environment policies.

    My answer on the three best qualities about Edmonton: Edmonton always seems to be a few degrees warmer than Calgary in the summer, it has a vibrant arts scene, and a beautiful river valley.

    What is your take on transfer payments to the provinces.
    Alberta pays huge amounts of taxes to the Feds which is then divvied up to the provinces. Quebec has benefited by this to the point it has a fabulous child care program where parents pay very little per day to put their children in day care.
    What would you do with transfer payments that allow other provinces to have platinum programs at the expense of other provinces.
    Why can't Alberta have a day care program like Quebec?.

    My answer on transfer payments: Albertans are generous and I believe they support the basic idea of equalization: That provinces should enjoy roughly equivalent programs for roughly equivalent tax rates. That’s not what’s happening now. Alberta has a fiscal imbalance of $21 billion – we send $21 billion more to Ottawa in taxes than we get back in federal benefits and spending. Meanwhile, recipient provinces are able to enjoy a level of program spending that is above that of the contributing provinces of BC, AB, and ON. The have-nots tend to have a higher number of nurses, doctors and teachers per capita, QC enjoys subsidized day-care and subsidized electricity rates, and post-secondary students pay half as much tuition as Alberta students. The transfer has become too large and increasingly unfair. Ottawa needs to correct this fiscal imbalance by transferring tax points to provinces, eliminating most federal transfers and allowing provinces to take care of their own business with own-source revenues.

    My answer on day care: I don’t believe Albertans want to adopt an expensive new social program. I think families need to be free to make their own decisions about child care, including choosing to have one parent stay at home without being penalized under the tax system. Government should target direct support to needy families only.

    Will your party absolutely and unequivocally commit to the following for the Alberta public school curriculum:

    -- the mandatory teaching of modern science, including but not limited to evolution, geology, and cosmology?
    -- the total exclusion of religiously inspired pseudo-science and pseudo-history, included but not limited to intelligent design and biblical mythology presented as supposed historical fact?
    -- the mandatory provision of sexual education, including discussion -- without condemnation -- of such topics as contraception and birth control?
    -- a unit for ecology and environmental science, including discussion of such proven effects as anthropogenic global warming, depletion of energy stocks, marine, land, and aerial pollution?
    -- unit for social science, including such topics as economic and military imperialism, comparative religion, population movements, cultural dissemination, bigotry and tolerance, and issues of social and economic development in all the continents?

    My answer on mandatory teaching of science, ecology, social sciences: As you know Alberta Education develops provincial curriculum in consultation with principals, parents, education experts, post-secondary institutions and community members. This is to ensure student needs are being met and there is a smooth transition to post-secondary and to work, and that the curriculum is developed free from ideological biases. This process would continue under a Wildrose government.

    My answer on total exclusion of religion from schools: I support the right of parents to choose the education that is most appropriate for their children. The Catholic school system offers an important education option for parents in Alberta. There are several other religious schools that operate under the umbrella of the public system or operate as stand-alone private schools. As a supporter of religious freedom, I support the right of these schools to exist, to receive funding and to serve Alberta parents and students.

    My answer on mandatory sex ed: Parents should play a key role in choosing the sex-ed program that is suitable for their children and the appropriate grade level to introduce it.