After many long years, Alberta is back in the black! Our province has a balanced budget, and a surplus!
After seeing oil prices dip into negative values and much of our economy grind to a halt in early 2020, many thought it would take years for a province to return to a position of fiscal balance – myself included. Yet here we are!
This certainly did not happen by accident. When we formed government in 2015, Alberta was spending approximately $10 billion more per capita per year for similar services as other provinces, and our spending trajectory was growing at a rate of 4.5% year over year. Had these spending levels been maintained, even with the recent rise in commodity prices, our province would have run a $6 billion deficit this year.
Alberta’s balanced budget is the direct result of three years of calculated fiscal restraint, and rapid economic growth across every sector of our economy. Through even the toughest of times, including a two year long global pandemic, our government maintained key fiscal anchors of bringing per-capita spending in line with other provinces, reducing our spending trajectory to just 0.35% year over year, and keeping our debt-to-GDP ratio well below 30%.
We also dramatically increased corporate revenues through economic growth and diversification. Reducing Alberta’s corporate tax rate from 12% to 8% over the past two years and eliminating over 116,000 regulations to conducting business in our province, resulted in a net increase in corporate tax revenues of $400 million. These $5.1 billion of corporate revenues were realized primarily through investments in sectors that are new and emerging to Alberta’s economy, such as tech, film, hydrogen, lithium, petrochemical production, and green energy. This demonstrates the importance of creating a business-friendly climate, rid of over-regulation and taxpayer subsidization – contrary to the policies of the previous government who increased Alberta’s corporate tax rate by 50% and subsequently brought in $3 billion less revenue as business and corporate offices fled the province.
Yet calculated fiscal restraint for three years did not mean our government was unable to make strategic investments in our province’s future. Rather, this fiscal restraint in calculated areas allowed us to responsibly do the opposite and make strategic investments where they were most needed.
Budget 2022-23 included a record level of healthcare funding, with a $515 million increase on top of last year’s billion-dollar increase. This included $750 million to clear surgical backlogs, an additional $64 million for EMS, $20 million for mental health and addictions on top of previous increases of over $200 million, $3.7 billion for continuing and home care representing a 6.3% increase, $2.2 billion for new healthcare facilities, and $100 million to expand ICU capacity.
The budget funded a $700 million increase to Alberta’s education system, which included $342 million for staffing and enrollment growth, a 1% increase to the base operational grants, $191 million for curriculum implementation, a $39 million increase – or 4.6% – for transportation costs, and $110 million for mental health supports for students who struggled most during COVID-19 protocols and schooling shifts.
It included $600 million to strengthen Alberta’s labour force by connecting young Albertans with employment opportunities, attracting skilled workers to Alberta, expediting credential recognition for new immigrants, creating scholarships and bursaries, increasing apprenticeship placements, and streamlining approvals for post-secondary institutions wishing to establish in-demand course and micro credential programs.
Budget 2022-23 invested $390 million over four years to invest in rural broadband, to ensure that every Albertan, regardless of where they choose to live, can participate in an increasingly digital economy and workforce.
It even established a consumer energy rebate program to combat increasing natural gas prices, which will be triggered for all Alberta consumers whose regulated rates rise above $6.50/gigajoule. It also eliminated the gas tax, a 13 cent per liter savings at the pump.
Getting to this balanced fiscal position took hard work and resolve on behalf of every Albertan. For years, jobs were hard to come by and economic and fiscal recovery seemed indefinitely far on the horizon. Yet through the hardest of times, the unwavering optimism of the Alberta spirit pushed forward and believed in better days ahead. Now, we are finally in a position to invest in areas that matter most, begin paying down long-term debt, and invest in the Heritage Savings Trust Fund.
Last election, people resoundingly recognized at the ballot box that every dollar spent beyond government limitations would inevitably need to be paid back through high inflation, a devalued currency, or crippling taxation if things didn’t change. That’s why our government was elected, by you, on a firm commitment to balance Alberta’s budget by the end of our first term.
Now today, we are here – with a strong and diversified economy, and a $551 million surplus, one full year ahead of schedule!
Miranda Rosin
