Alberta
Finance Minister Nate Horner says Alberta on track to $2.4 billion surplus
Q1 update: Continued fiscal growth
Alberta’s strong fiscal management continues to secure Alberta’s future.
Alberta is on course to record a $2.4-billion surplus at the end of 2023-24, despite an unprecedented wildfire season and ongoing economic volatility. This is $94 million higher than forecast in Budget 2023.
Strong and prudent fiscal management will help Alberta remain the economic engine of Canada. The government’s new fiscal framework requires the government to use at least half of available surplus cash to pay down debt, freeing up money that can support the needs of Alberta families now and for decades to come. Based on the first quarter update, Alberta plans to eliminate $2.6 billion in taxpayer-supported debt this fiscal year.
“Alberta’s finances remain strong, and thanks to our new fiscal framework, Alberta’s fiscal position is poised to become even stronger. Our continued priorities of paying down debt and saving for the future will ensure we have the capacity to meet Albertans’ needs both today and well into the future.”
After the required 50 per cent of projected available surplus cash is used to pay off maturing debt, remaining surplus cash will be allocated to the Alberta Fund, where it can be used for additional debt repayment, contributions to the Alberta Heritage Savings Trust Fund and one-time initiatives that do not lead to a permanent increase in government spending. A projected $2.6 billion will be set aside in the Alberta Fund in 2023-24.
Revenue
Revenue for 2023-24 is forecast at $71.1 billion, a $491-million increase from Budget 2023.
Alberta’s robust business environment is attracting investment and people from around the country, driving a projected $1.5-billion increase in corporate and personal income tax revenue.
The corporate income tax revenue forecast has increased by $889 million, following a record-high year in 2022-23. At eight per cent, Alberta’s general corporate income tax rate is the lowest in the country. Alberta’s low taxes remain one reason investors choose Alberta.
Keeping life affordable is a key priority for Alberta’s government, which is why it paused the provincial fuel tax on gasoline and diesel in January. Extending the pause to the end of 2023 will save Albertans and Alberta businesses 13 cents per litre on gasoline and diesel for the rest of the calendar year. As a result, fuel tax revenue is forecast to be reduced by $532 million – money that is going directly back into the pockets of Albertans every time they fill up their vehicle.
Between April 1 and June 30, the price of West Texas Intermediate (WTI) oil averaged US$74 per barrel. It is now forecast to average $US75 per barrel over the course of the fiscal year, $4 lower than the Budget 2023 forecast. The resulting impact on Alberta’s revenue is being offset by a narrower light-heavy oil price differential, which is now forecast to average US$15 per barrel, $5 narrower than at budget.
Bitumen royalties are projected to increase by $515 million in 2023-24; however, overall resource revenue is projected to decrease by $694 million from the budget forecast. Lower natural gas royalties account for most of the projected decrease due to weaker prices, robust North American production and the impact of wildfires on production in Alberta.
Expense
Expense for 2023-24 is forecast at $68.7 billion, a $397-million increase from Budget 2023. The expense increase before the forecast contingency allocation is $1.6 billion. Of this, $397 million is funded by dedicated revenue and $1.2 billion is set aside as a preliminary allocation from the contingency, leaving $323 million unallocated.
The unprecedented wildfire season in the province prompted Alberta’s government to act swiftly and responsibly to ensure the safety of Albertans in affected areas. To date, the government has allocated $750 million for fighting wildfires in the province this year, along with $175 million for uninsurable losses, $75 million of which is expected to be covered by the federal government, and $55 million, mainly for emergency evacuation payments. Alberta’s government will continue to support Albertans during difficult situations like natural disasters.
The operating expense forecast has increased by $179 million, mainly due to a $214-million increase in Health funding that is being fully offset by federal bilateral agreement revenue. Capital grant increases of $170 million are mainly for re-profiling projects from the 2022-23 fiscal year.
Debt servicing costs are forecast to increase $245 million from budget, mainly due to higher interest rates – reiterating the importance of government’s commitment to paying down debt.
Alberta Heritage Savings Trust Fund
The Alberta Heritage Savings Trust Fund is Alberta’s long-term savings account, and the government remains committed to growing it. The fund performed well during the 2023-24 first quarter, earning a two per cent return with a net investment income of $739 million. Its fair value of net assets on June 30 was $21.6 billion, an increase from the $21.2 billion recorded at the end of the previous fiscal year.
Over five years, the fund returned 6.4 per cent, which is 0.6 per cent above the return of its passive benchmark.
Economic outlook
By continuing to grow and diversify Alberta’s economy, Alberta’s government is continuing to exceed expectations. Alberta’s real gross domestic product is now expected to rise three per cent in 2023, up 0.2 percentage points from Budget 2023. Projections by private forecasters show the province is expected to lead the country in economic growth this year.
Robust population growth is supporting Alberta’s labour market and generating demand and activity in Alberta’s economy, ultimately boosting the province’s economic outlook. Although risks and uncertainty persist due to rising interest rates, high consumer prices and other factors, Alberta’s economy remains well-positioned to withstand any challenges that arise.
Quick facts
- The amount of surplus cash available for debt repayment and the Alberta Fund is calculated after several necessary cash adjustments are made.
- In 2023-24, the total amount available for allocation is forecast at $5.2 billion, which includes $5.1 billion carried over from the 2022-23 final results.
The new Red Deer Justice Centre will help Albertans resolve their legal matters faster.
Albertans deserve to have access to a fair, accessible and transparent justice system. Modernizing Alberta’s courthouse infrastructure will help make sure Alberta’s justice system runs efficiently and meets the needs of the province’s growing population.
Alberta’s government has invested $191 million to build the new Red Deer Justice Centre, increasing the number of courtrooms from eight to 12, allowing more cases to be heard at one time.
“Modern, accessible courthouses and streamlined services not only strengthen our justice
system – they build safer, stronger communities across the province. Investing in the new Red Deer Justice Centre is vital to helping our justice system operate more efficiently, and will give people in Red Deer and across central Alberta better access to justice.”
Government of Alberta and Judiciary representatives with special guests at the Red Deer Justice Centre plaque unveiling event April 22, 2025.
On March 3, all court services in Red Deer began operating out of the new justice centre. The new justice centre has 12 courtrooms fully built and equipped with video-conference equipment to allow witnesses to attend remotely if they cannot travel, and vulnerable witnesses to testify from outside the courtroom.
The new justice centre also has spaces for people taking alternative approaches to the traditional courtroom trial process, with the three new suites for judicial dispute resolution services, a specific suite for other dispute resolution services, such as family mediation and civil mediation, and a new Indigenous courtroom with dedicated venting for smudging purposes.
“We are very excited about this new courthouse for central Alberta. Investing in the places where people seek justice shows respect for the rights of all Albertans. The Red Deer Justice Centre fills a significant infrastructure need for this rapidly growing part of the province. It is also an important symbol of the rule of law, meaning that none of us are above the law, and there is an independent judiciary to decide disputes. This is essential for a healthy functioning democracy.”
“Public safety and access to justice go hand in hand. With this investment in the new Red Deer Justice Centre, Alberta’s government is ensuring that communities are safer, legal matters are resolved more efficiently and all Albertans get the support they need.”
“This state-of-the-art facility will serve the people of Red Deer and surrounding communities for generations. Our team at Infrastructure is incredibly proud of the work done to plan, design and build this project. I want to thank everyone, at all levels, who helped make this project a reality.”
Budget 2025 is meeting the challenge faced by Alberta with continued investments in education and health, lower taxes for families and a focus on the economy.
Quick facts
- The new Red Deer Justice Centre is 312,000 sq ft (29,000 m2). (The old courthouse is 98,780 sq ft (9,177 m2)).
- The approved project funding for the Red Deer Justice Centre is about $191 million.
From the Fraser Institute
By Tegan Hill
Amid the economic uncertainty fuelled by Trump’s trade war, its perhaps more important than ever to understand Alberta’s crucial role in the federation and its outsized contribution to programs such as the Canada Pension Plan (CPP).
From 1981 to 2022, Albertan’s net contribution to the CPP—meaning the amount Albertans paid into the program over and above what retirees in Alberta received in CPP payments—was $53.6 billion. In 2022 (the latest year of available data), Albertans’ net contribution to the CPP was $3.0 billion.
During that same period (1981 to 2022), British Columbia was the only other province where residents paid more into the CPP than retirees received in benefits—and Alberta’s contribution was six times greater than B.C.’s contribution. Put differently, residents in seven out of the nine provinces that participate in the CPP (Quebec has its own plan) receive more back in benefits than they contribute to the program.
Albertans pay an outsized contribution to federal and national programs, including the CPP because of the province’s relatively high rates of employment, higher average incomes and younger population (i.e. more workers pay into the CPP and less retirees take from it).
Put simply, Albertan workers have been helping fund the retirement of Canadians from coast to coast for decades, and without Alberta, the CPP would look much different.
How different?
If Alberta withdrew from the CPP and established its own standalone provincial pension plan, Alberta workers would receive the same retirement benefits but at a lower cost (i.e. lower CPP contribution rate deducted from our paycheques) than other Canadians, while the contribution rate—essentially the CPP tax rate—to fund the program would likely need to increase for the rest of the country to maintain the same benefits.
And given current demographic projections, immigration patterns and Alberta’s long history of leading the provinces in economic growth, Albertan workers will likely continue to pay more into the CPP than Albertan retirees get back from it.
Therefore, considering Alberta’s crucial role in national programs, the next federal government—whoever that may be—should undo and prevent policies that negatively impact the province and Albertans ability to contribute to Canada. Think of Bill C-69 (which imposes complex, uncertain and onerous review requirements on major energy projects), Bill C-48 (which bans large oil tankers off B.C.’s northern coast and limits access to Asian markets), an arbitrary cap on oil and gas emissions, numerous other “net-zero” targets, and so on.
Canada faces serious economic challenges, including a trade war with the United States. In times like this, it’s important to remember Alberta’s crucial role in the federation and the outsized contributions of Alberta workers to the wellbeing of Canadians across the country.
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