Trenza: the government’s hypocrisy about reindexing offends the seven UCP candidates

In Jason Kenney’s last days as Prime Minister, the UCP exhibits strange and possibly ruthless views on inflation and AISH payments.

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In Jason Kenney’s last days as Prime Minister, the UCP exhibits strange and possibly ruthless views on inflation and AISH payments.

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The province will reinstate the gasoline tax of 4.5 cents per liter on October 1. This is part of the policy announced in April, when the UCP suspended the provincial tax of 13 cents per liter, but also said the levy would return in stages. when oil prices fell.

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From mid-August to mid-September, oil prices fell to an average of $89.26 a barrel. This caused a 4.5-cent increase in pumps, effective October 1.

Gasoline prices have fallen sharply since the spring, when they hovered near $1.90 a liter. On Friday, Calgary prices ranged from $1.20 to $1.45.

This drop in pump prices has almost single-handedly lowered the national inflation rate, which was seven percent in August.

But adding any tax to the price of the pump now, even 4.5 cents, is an inflationary measure. It puts new pressure on the one sector that was falling while others are rising inexorably, especially in the food sector.

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Another key measure is the reindexation of the personal income tax to inflation, which the UCP announced on August 31. This means Albertans will pay $304 million less in taxes in 2022-23.

The deindexation, which the UCP had begun in 2019, had already cost taxpayers $647 million from 2020 to 2022.

The reindexing is exceptionally good news for Albertans at a time of high inflation.

Of course, reindexing is also inflationary because it leaves people with more money to spend.

This is where ruthless hypocrisy comes in.

At the same time the tax re-indexation was announced, the government said that payments for disadvantaged Albertans, including recipients of Alberta Income for the Severely Handicapped, or AISH, would NOT be re-indexed.

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The government insists that the payment levels of this benefit are 37 percent higher than those of the second most generous province. The NDP insists that is simply not true.

A single Alberta living with AISH in the community gets $1,685 a month, not much to live on, no matter what the benefit is elsewhere.

Inflation now takes seven percent or more of that value. AISH recipients will continue to experience reductions in payments in the real world.

On September 7, Kenney was asked about AISH’s lack of reindexing and other benefits.

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He cited the province’s high payments as a key reason. He also warned that the government has to contain costs because revenues may not stay high.

“We don’t want to get too far ahead of our skis,” he said, adding that the province “cannot make the mistake of increasing our spending.”

He also painted the reindexing of AISH as an inflationary measure.

“We don’t want to add fuel to the fire of inflation like some governments are doing by spending more and more,” he said, speaking of AISH.

Finance Minister Jason Nixon made the same argument.

Well, why deindex the personal income tax? Why raise gas prices? Both measures are inflationary and have a much larger impact on the overall economy than AISH.

All the candidates for the leadership of the UCP condemn the government’s failure to re-index AISH.

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Rajan Sawhney, who as social services minister fought against pressure to scrap the programme, says: “I was the first to say I would start indexing.”

Leela Aheer, UCP Leader Candidate.
Leela Aheer, UCP Leader Candidate. Vincent McDermott/Post Media

Leela Aheer also claims first place. “I was the first to turn that off when I declared that I was running.”

Rebecca Schulz says, “Reindexing other supports, including personal income tax, but not benefits for seniors and AISH, is not fair, not in line with feedback I’ve heard, and not blatant spending.”

Todd Loewen, the smallest Conservative of all the candidates, is also calling for a re-indexing.

Travis Toews, who was treasurer when the de-indexing was announced, says, “I will re-index those programs that we stopped indexing on, and that includes AISH.”

Danielle Smith states: “If elected Prime Minister, I will urge the caucus and Treasury Board to immediately approve AISH indexation and other benefit programs for low-income seniors and vulnerable people. It’s just the right thing to do.”

Brian Jean also calls for AISH beneficiaries to get the full benefits of re-indexing.

“I am also open to working with AISH advocates to increase the amount of money grantees can earn before their support picks up,” says Jean. “It’s the right thing to do given what’s happening with the cost of necessities.”

Surprisingly, all seven candidates to replace Kenney condemn a decision made by their own government during the leadership campaign. That’s how hypocritical he was.

Don Braid’s column appears regularly in the Calgary Herald.

Twitter: @DonBraid

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