Article content

There will be more political fallout than financial consequences from a credit-rating agency’s new negative long-term outlook for Alberta, a Mount Royal University political studies professor says.

DBRS on Friday said the provincial government’s continuing accumulation of debt and no “credible” plan to reduce future deficits prompted the agency to forecast a negative outlook for Alberta’s finances, instead of its previously stable state.

We apologize, but this video has failed to load.

tap here to see other videos from our team. Try refreshing your browser, or Credit-rating agency downgrades Alberta's long-term outlook Back to video

“While Alberta’s debt burden is low and the economy is showing signs of recovery, the fiscal plan demonstrates a lack of willingness to contain debt growth, which is likely to lead to a one-notch downgrade of the long-term ratings,” the agency said in a news release.

With a $10.8-billion deficit recorded in 2016-17, Alberta’s credit rating with DBRS remains at AA (high). A downgrade within the year is likely, it said.

Although the province intends to balance its books by 2024, it refuses to adopt new or higher taxes, and insists on maintaining public services, which makes reaching balance “highly uncertain,” the agency said.