RED DEER, Alta. - It's simply wrong to say that Alberta's current royalty regime has been a failure, says Premier Ed Stelmach.
Stelmach told a Tory fundraising dinner Thursday night in Red Deer, Alta., that "the policy to encourage investment has drawn billions of dollars and generated economic activity and tax revenue that has benefited all Albertans."
A government-appointed review panel and Alberta's auditor general have recently concluded that the province's energy royalties are much too low and have been for several years.
The royalty panel sent shockwaves through the energy industry by recommending a 20 per cent increase in total royalties worth roughly $2 billion per year.
The industry has responded with almost-daily announcements of plans to trim billions worth investments and eliminate thousands of jobs if the royalty panel's recommendations are followed.
A group of roughly 700 energy workers staged a rally in front of the legislature Wednesday to protest the prospect of higher royalties. But other groups and at least one member of the royalty panel accused the major energy firms of orchestrating the rally to pressure the government to keep royalties low.
It was the second time in a week that Stelmach spoke in defence of existing royalties. Last Thursday, the premier reportedly told a private gathering of business executives that he didn't want to "trounce" existing royalty deals with individual energy firms.
This statement, relayed to a reporter by someone at the breakfast, contradicts the recommendation of the royalty panel, which advised against grandfathering existing royalty agreements.
Stelmach, who will give his formal reaction to the royalty report next week, told the crowd of 500 at Thursday's dinner that Alberta's current royalty structure "has created one of the most successful economies on earth."
The premier also reiterated his promise to come up with a royalty regime that's fair to the companies investing billions of dollars to develop Alberta's resources.
"One that provides the stability and predictability business need," he said. "But these are not the government's resources or the industry's resources, they are the birthright of all Albertans ... and I must be guided by that."
The premier told reporters later that windfall energy revenues have allowed Alberta to pay off its debt and bring forward health and education programs "that are unmatched in other provinces."
"Perhaps some people were thinking that the money that might have not been collected in royalties evaporated from the province," he said. "It hasn't. It's in increased land sales, it's in huge increases in corporate tax revenue and also in personal income tax."
Stelmach also confirmed he met with several review panel members earlier Thursday for the first time since their report was released.
The meeting was to discuss some of their findings and the information they used to reach their conclusions, he said.
"They gave us further feedback on how they arrived at some of the recommendations."
