A Calgary business audience gave Alberta Finance Minister Joe Ceci a warm reception Monday morning for his speech explaining last week's budget, which could see the provincial government run deficits for most of the next decade.

The crowd at the sold-out event applauded Ceci six times as he discussed the NDP government's financial strategy.

We have the best balance sheet of any province in the country - Finance Minister Joe Ceci



Thursday's budget included several measures aimed at helping small businesses in the province during the economic downturn, including:

The small-business tax rate in Alberta will be cut from three per cent to two per cent.

The Alberta Investor Tax Credit, worth $90 million over two years, will benefit investors in small and medium-sized business

The Capital Investment Tax Credit, worth $75 million over two years, will provide an incentive for the first-time acquisition of new or used property in certain industries

There's now a 30 per cent tax credit for investors in small and medium sized Alberta companies in "non-traditional" sectors, including IT, clean tech, health tech, visual effects, and even gaming. 6:44

"From a small business perspective — refreshing," said Brian Beitz, who runs a small resource company. "We absorb the risk directly. We are the shareholders. Our money stays in the province. So I think we are worth supporting."

Specifically, Beitz appreciates the tax cut although he would like to see the threshold of $500,000 raised a little higher.

The investment credit is aimed at helping businesses attract more capital, which can be especially difficult during a downturn.

"It's actually a really good initiative for the government to bring in now. It will certainly help out small enterprises," said Scott McTavish, CEO of the Pumphouse Theatre. "It's good to see a government approach challenges with creative and sometimes out of the box thinking. It's a good start."

The theatre is a non-profit, but McTavish said any initiative to put more money into the middle class helps organizations like his.

"We're starting to see less people come now to the theatre because their severance may be running out, they are transitioning to [employment insurance] and people are starting to tighten their budgets," he said.

Debt concerns

After delivering his speech Ceci was asked by Calgary Chamber of Commerce CEO Adam Legge whether a corporate tax cut could happen in the future following the small business tax cut. Ceci gave a blunt one-word answer: "No."

Ceci was much more willing to discuss the provincial government's debt and plans to run several deficit budgets. Total debt is projected to hit $57.6 billion by 2019, which is a concern of many business groups.

"We have the best balance sheet of any province in the country," Ceci told the crowd. "We're going to use that to spur economic activity in this province, recognizing we can't fill that hole that private investment provided for so long in this province."

Credit rating drop

Ceci said his goal is to balance the budget by 2024. Following the budget, bond rating agency DBRS downgraded Alberta's credit rating from triple-A to double-A.

DBRS said the Alberta budget confirmed a significant fiscal shortfall, magnified by the government's reluctance to rein in spending or adjust taxation levels and a sizable capital plan.

"That was a disappointment to me," Ceci told reporters. "We will be fighting hard to get it back. I am controlling the cost of spending along with all of the ministers in cabinet. So we are going to work hard to show we uphold our promises as to what our plan is. If they can trust our plan and trust us, I think we'll get it back."

Ceci will be speaking with rating firms next week. He said the government chose to maintain services and provide stimulus, instead of "draconian cuts."