Oil wealth fund worth considering

Much ado has been made of Prime Minister Stephen Harper’s recent tip-toe through the province

Much ado has been made of Prime Minister Stephen Harper’s recent tip-toe through the province and the cloud of protest that seemed to follow him.

A highlight was the prime minister’s appearance at a Vancouver Board of Trade meeting, where a question/answer period was briefly interrupted by interlopers dressed as wait staff. The two managed to evade security to stand behind the prime minister, and before the crowd, holding signs calling attention to the federal government’s response, or lack thereof, to climate change.

A particular peeve of the dissenters is the Harper government’s pro-oil sands stance (an estimated  $40 million was set aside in Natural Resources Canada’s 2013-14 budget for related advertising), and the industry’s environmental impacts.

What’s lacking is protest over how Canadians on the whole are failing to benefit from said resource extraction.

Residents of Norway, the world’s seventh largest oil exporter, are now considered among the most financially secure thanks to a $828 billion sovereign wealth fund fuelled by taxation on oil profits. Established in 1990, the Government Pension Fund Global is re-invested outside of the country, primarily in stocks that are currently worth about $177,000 per Norwegian. Instead of using this money for pork barrel projects or oil-industry subsidies, Norway is following the example of our grandparents or great-grandparents and saving the money for a rainy day. Obviously, oil-rich Alberta’s somewhat similar Sustainability Fund, which had reached $16.8 billion by the end of 2009, isn’t cutting it. The province’s deficit, exacerbated by last year’s flooding in Calgary, is in the billions, and forcing the provincial government to borrow millions for capital projects.

While environmental concerns related to the oil sands must not be dismissed, a resource taxation model that places stable, long-term security ahead of short-term gain is also worthy of consideration.