CALGARY — A newly released fiscal analysis by former Alberta Treasury Board and Finance official Lennie Kaplan suggests an independent Alberta could begin life facing a cash deficit of roughly $27.2 billion in its first year, adding fresh scrutiny to the economic arguments surrounding provincial independence.The report estimates Alberta could assume approximately $174 billion in federal debt under a secession scenario, while annual debt-servicing costs could exceed $15 billion when combined with the province’s existing debt obligations.According to the analysis, the projected deficit does not include several policy commitments frequently promoted by some independence advocates, including eliminating personal income taxes, reducing corporate tax rates and implementing other major fiscal measures.Kaplan argues that supporters of Alberta independence have yet to provide detailed financial plans explaining how a sovereign Alberta would pay for government services, pensions, transition expenses and debt obligations without resorting to spending cuts, tax increases or additional borrowing..Alberta appoints panel to study economic impact of independence ahead of referendum .“Albertans deserve straight answers before they cast a ballot on something this consequential,” said Monte Solberg, founder of Vote to Stay and a former federal cabinet minister.“This analysis raises serious questions about how an independent Alberta would pay its bills, fund public services, and manage billions of dollars in new debt obligations. Before anyone asks Albertans to take that leap, they need to show their work.”The report also raises concerns that a newly independent Alberta could face higher borrowing costs than it currently enjoys as a province within Canada.Kaplan notes that several major transition expenses remain undefined, making it difficult to fully assess the financial impact of separation.Among the unanswered questions identified in the analysis are the costs of establishing new federal-style institutions, replacing shared services currently provided by Ottawa, and managing the transition to independent governance structures.Solberg said Albertans should be provided with a detailed accounting of the costs before being asked to support a move toward independence.“Albertans are proud, ambitious people, and we should always aim high,” he said.“But optimism alone is not a fiscal plan. Families, businesses, and investors would all be affected by decisions of this magnitude. Albertans deserve a clear, credible, and transparent accounting of the costs before being asked to put our economy and our future at risk.”The analysis is expected to add fuel to an increasingly active debate over Alberta’s future relationship with Confederation, as advocates and opponents of separation continue to clash over the economic opportunities and risks associated with independence.
