After taking $233 million from Kenney’s tax cut, Husky confirms 370 layoffs and $500 million less in investments
Calgary-based Husky Energy Inc. has decided to cut its capital spending plan by $500 million. Their new plans now forecast $100 million less in spending for 2020 and $400 million less for 2021. The spending in question will remain focused on projects in Atlantic Canada and China.
While announcing these changes, Husky’s CEO revealed that 370 jobs have been trimmed as a result. The job cuts are estimated to create $70 million in savings for the fossil fuel company.
This decision comes despite Alberta Premier Jason Kenney’s plans to cut corporate tax rates from 12 percent to 8 percent over four years. The first 1 percent cut, which came earlier this year, translated to $233 million in savings for Husky Energy.
The plan, entitled the Job Creation Tax Cut, was meant to spur investment and employment in the prairie province. However, immediately after receiving the tax handout, Husky Energy laid off hundreds of workers in Alberta.
Now, Husky has made it clear that even massive tax handouts will not keep them invested in Alberta’s oil sands. The next two years will see another 2 percent drop in their corporate tax rate, meaning millions more in savings and profits. However, the company is still choosing to decrease investment over this time. Worst yet, the projects which Husky is investing in will be outside of Alberta.
Not only has Kenney’s corporate tax cut experiment failed to produce jobs, it has also failed to attract investment. Jason Kenney sold himself as the person who could cure Alberta’s ails. It’s becoming increasingly clear that he cannot.