Red ink is white knight: Alberta’s Prentice says deficits to solve oil crisis

EDMONTON – Premier Jim Prentice says Alberta’s economy is on a razor’s edge and deficits will be needed to prevent it from falling into the deep.

Prentice, in a conference call from Houston, said economists are telling him that without deficits the low price of oil could push Alberta into a recession and make matters much worse.

Alberta is struggling with collapsing oil prices that have siphoned billions of dollars from the treasury.

Prentice has refused to rule out clawing back public-sector salaries or imposing tax increases or a sales tax.

The premier also fuelled speculation that an election is coming this spring by saying he won’t proceed with any financial changes without a mandate from the people.

Responding to a suggestion that he and his Progressive Conservatives failed to manage the economy in good times, the premier said he just took over the top job four months ago.