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Alberta fighting federal “unconstitutional intrusion” into provincial jurisdiction

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Alberta to fight federal plastics ban once more

Alberta’s government will continue defending the province’s constitutional jurisdiction and economy by intervening in Ottawa’s appeal of the Federal Court’s ruling on plastics.

On Nov. 16, the Federal Court of Canada ruled that the federal order-in-council classifying plastics as toxic is not only unreasonable but unconstitutional. The federal government has chosen to appeal this decision, ignoring calls from Alberta and others to accept the court’s decision.

As a result, Alberta’s government will participate in the appeal and will argue that the federal government’s decision to label plastic as a “toxic substance” is an unconstitutional intrusion into provincial jurisdiction.

“It is past time for Ottawa to listen. We have told them they are overreaching their jurisdiction, the private sector has told them so, and so have both the Supreme Court and the Federal Court. Ottawa cannot assume regulatory authority over any substance simply by designating it as toxic. We will continue to push back against Ottawa’s unconstitutional actions, including through this legal action, until they listen.”

Danielle Smith, Premier

The toxic designation and bans have also had a detrimental impact on Alberta’s economy. Alberta’s Industrial Heartland Association estimates the designation will potentially jeopardize more than $30 billion in capital investment in the petrochemical sector by 2030. Those risks would also put Albertan and Canadian workers at risk of losing their jobs.

“The Federal Court clearly ruled that the federal government’s plastics ban policies were unconstitutional. The federal government’s environmental policies and constitutional overreach have been heavily criticized and this ruling further confirms the indisputable nature of provincial jurisdiction in these matters. We are intervening in this appeal and will continue to participate wherever and whenever necessary to protect Alberta’s interests.”

Mickey Amery, Minister of Justice

In addition to intervening in the appeal, Alberta will monitor any further legal action taken to remove plastic manufactured items from the current Schedule 1 of the Canadian Environmental Protection Act. Several Calgary-based companies producing compostable plastic bags are now caught in the ban and will be barred from supplying Calgarians with low-emissions alternatives to traditional plastic shopping bags.

“Instead of listening to the courts and to Canadians, the federal government has chosen overreach once again. We will continue standing up for our constitutional jurisdiction while focusing on more effective ways to reduce plastic waste and keep it out of landfills.”

Rebecca Schulz, Minister of Environment and Protected Areas

Alberta is committed to reducing plastic waste through initiatives like extended producer responsibility, which encourages businesses to find new ways to recycle materials and reduce waste. The province also advocates for strategies that create economies of scale, promote recycled content and develop local markets for transformed plastic waste.

Quick facts

  • On April 23, 2021, the administrator in council issued an order-in-council directing that “plastic manufactured items” be added to Schedule 1 of the Canadian Environmental Protection Act, 1999 (CEPA).
  • The category of plastic manufactured items includes every piece of plastic that enters Alberta.
  • Once a substance is designated as toxic under CEPA, CEPA allows the federal government to make regulations regulating every aspect of that substance’s life, from manufacture to sale to use and to disposal.
  • Canada subsequently enacted the Single-use Plastics Prohibition Regulations (SUPPR) prohibiting the manufacture, import and sale of six single-use plastics. SUPPR is only valid if “plastic manufactured items” is listed as toxic on Schedule 1 of CEPA.
  • The Responsible Plastic Use Coalition, Dow, Imperial Oil and Nova applied for a judicial review of the order. They challenged it as unreasonable on administrative law grounds and as unconstitutional on division of powers grounds.
  • On Sept. 7, 2022, Alberta intervened in the application to address the constitutional questions. Saskatchewan intervened on Oct. 24, 2022.
  • The application was heard March 7-9, 2023, and the court reserved its decision.
  • On Nov. 16, the federal Court of Canada issued its decision. Justice Angela Furlanetto concluded that the order adding “plastic manufactured items” to the Schedule 1 was both unreasonable from an administrative law perspective, and unconstitutional.

This is a news release from the Government of Alberta.

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Alberta

Alberta’s fiscal update projects budget surplus, but fiscal fortunes could quickly turn

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From the Fraser Institute

By Tegan Hill

According to the recent mid-year update tabled Thursday, the Smith government projects a $4.6 billion surplus in 2024/25, up from the $2.9 billion surplus projected just a few months ago. Despite the good news, Premier Smith must reduce spending to avoid budget deficits.

The fiscal update projects resource revenue of $20.3 billion in 2024/25. Today’s relatively high—but very volatile—resource revenue (including oil and gas royalties) is helping finance today’s spending and maintain a balanced budget. But it will not last forever.

For perspective, in just the last decade the Alberta government’s annual resource revenue has been as low as $2.8 billion (2015/16) and as high as $25.2 billion (2022/23).

And while the resource revenue rollercoaster is currently in Alberta’s favor, Finance Minister Nate Horner acknowledges that “risks are on the rise” as oil prices have dropped considerably and forecasters are projecting downward pressure on prices—all of which impacts resource revenue.

In fact, the government’s own estimates show a $1 change in oil prices results in an estimated $630 million revenue swing. So while the Smith government plans to maintain a surplus in 2024/25, a small change in oil prices could quickly plunge Alberta back into deficit. Premier Smith has warned that her government may fall into a budget deficit this fiscal year.

This should come as no surprise. Alberta’s been on the resource revenue rollercoaster for decades. Successive governments have increased spending during the good times of high resource revenue, but failed to rein in spending when resource revenues fell.

Previous research has shown that, in Alberta, a $1 increase in resource revenue is associated with an estimated 56-cent increase in program spending the following fiscal year (on a per-person, inflation-adjusted basis). However, a decline in resource revenue is not similarly associated with a reduction in program spending. This pattern has led to historically high levels of government spending—and budget deficits—even in more recent years.

Consider this: If this fiscal year the Smith government received an average level of resource revenue (based on levels over the last 10 years), it would receive approximately $13,000 per Albertan. Yet the government plans to spend nearly $15,000 per Albertan this fiscal year (after adjusting for inflation). That’s a huge gap of roughly $2,000—and it means the government is continuing to take big risks with the provincial budget.

Of course, if the government falls back into deficit there are implications for everyday Albertans.

When the government runs a deficit, it accumulates debt, which Albertans must pay to service. In 2024/25, the government’s debt interest payments will cost each Albertan nearly $650. That’s largely because, despite running surpluses over the last few years, Albertans are still paying for debt accumulated during the most recent string of deficits from 2008/09 to 2020/21 (excluding 2014/15), which only ended when the government enjoyed an unexpected windfall in resource revenue in 2021/22.

According to Thursday’s mid-year fiscal update, Alberta’s finances continue to be at risk. To avoid deficits, the Smith government should meaningfully reduce spending so that it’s aligned with more reliable, stable levels of revenue.

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Alberta

Premier Smith says Auto Insurance reforms may still result in a publicly owned system

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Better, faster, more affordable auto insurance

Alberta’s government is introducing a new auto insurance system that will provide better and faster services to Albertans while reducing auto insurance premiums.

After hearing from more than 16,000 Albertans through an online survey about their priorities for auto insurance policies, Alberta’s government is introducing a new privately delivered, care-focused auto insurance system.

Right now, insurance in the province is not affordable or care focused. Despite high premiums, Albertans injured in collisions do not get the timely medical care and income support they need in a system that is complex to navigate. When fully implemented, Alberta’s new auto insurance system will deliver better and faster care for those involved in collisions, and Albertans will see cost savings up to $400 per year.

“Albertans have been clear they need an auto insurance system that provides better, faster care and is more affordable. When it’s implemented, our new privately delivered, care-centred insurance system will put the focus on Albertans’ recovery, providing more effective support and will deliver lower rates.”

Danielle Smith, Premier

“High auto insurance rates put strain on Albertans. By shifting to a system that offers improved benefits and support, we are providing better and faster care to Albertans, with lower costs.”

Nate Horner, President of Treasury Board and Minister of Finance

Albertans who suffer injuries due to a collision currently wait months for a simple claim to be resolved and can wait years for claims related to more serious and life-changing injuries to addressed. Additionally, the medical and financial benefits they receive often expire before they’re fully recovered.

Under the new system, Albertans who suffer catastrophic injuries will receive treatment and care for the rest of their lives. Those who sustain serious injuries will receive treatment until they are fully recovered. These changes mirror and build upon the Saskatchewan insurance model, where at-fault drivers can be sued for pain and suffering damages if they are convicted of a criminal offence, such as impaired driving or dangerous driving, or conviction of certain offenses under the Traffic Safety Act.

Work on this new auto insurance system will require legislation in the spring of 2025. In order to reconfigure auto insurance policies for 3.4 million Albertans, auto insurance companies need time to create and implement the new system. Alberta’s government expects the new system to be fully implemented by January 2027.

In the interim, starting in January 2025, the good driver rate cap will be adjusted to a 7.5% increase due to high legal costs, increasing vehicle damage repair costs and natural disaster costs. This protects good drivers from significant rate increases while ensuring that auto insurance providers remain financially viable in Alberta.

Albertans have been clear that they still want premiums to be based on risk. Bad drivers will continue to pay higher premiums than good drivers.

By providing significantly enhanced medical, rehabilitation and income support benefits, this system supports Albertans injured in collisions while reducing the impact of litigation costs on the amount that Albertans pay for their insurance.

“Keeping more money in Albertans’ pockets is one of the best ways to address the rising cost of living. This shift to a care-first automobile insurance system will do just that by helping lower premiums for people across the province.”

Nathan Neudorf, Minister of Affordability and Utilities

Quick facts

  • Alberta’s government commissioned two auto insurance reports, which showed that legal fees and litigation costs tied to the province’s current system significantly increase premiums.
  • A 2023 report by MNP shows
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