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.”

Nate Horner, President of Treasury Board and Minister of Finance

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.

Related Topics:#AlbertaBudgetSurplus #AlbertaFiscalUpdate #AlbetaFinanceMinister #NateHorner feature

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Ottawa’s oil and gas emissions cap will hit Alberta with a wallop

Published on November 8, 2024

Todayville

From the Fraser Institute

By Kenneth P. Green

Even if Canada eliminated all its GHG emissions expected in 2030 due to the federal cap, the emission reduction would equal only four-tenths of one per cent of global emissions—a reduction unlikely to have any impact on the trajectory of the climate in any detectable manner or produce any related environmental, health or safety benefits.

After considerable waiting, the Trudeau government released on Monday draft regulations to cap greenhouse gas (GHG) emissions from Canada’s oil and gas producers.

The proposed regulations would set a cap on GHG emissions equivalent to 35 per cent of the emissions produced in 2019 and create a GHG emissions “cap and trade” system to enable oil and gas producers (who cannot reduce emissions enough to avoid the cap) to buy credits from other producers able to meet the cap. Producers unable to meet the cap will also be able to obtain emission credits (of up to 20 per cent of their needed emission reductions) by investing in decarbonization programs or by buying emission “offsets” in Canada’s carbon markets.

According to the government, the cap will “cap pollution, drive innovation, and create jobs in the oil and gas industry.” But in reality, while the cap may well cap pollution and drive some innovation, according to several recent analyses it won’t create jobs in the oil and gas industry and will in fact kill many jobs.

For example, the Conference Board of Canada think-tank estimates that the cap would reduce Canada’s GDP by up to $1 trillion between 2030 and 2040, kill up to 151,300 jobs across Canada by 2030, and national economic growth from 2023 to 2030 would slow from 15.3 per cent to 14.3 per cent.

Not surprisingly, Alberta would be hardest hit. According to the Board, from 2023 to 2030, the province’s economic growth would fall from an estimated 17.8 per cent to 13.3 per cent and employment growth would fall from 15.8 per cent to 13.6 per cent over the same period. Alberta government revenues from the sector would decline by 4.5 per cent in 2030 compared to a scenario without the cap. As a result, Alberta government revenues would be $4.5 billion lower in nominal terms in fiscal year 2030/31. And between 54,000 to 91,500 of Canada’s job losses would occur in Alberta.

Another study by Deloitte estimates that, due to the federal cap, Alberta will see 3.6 per cent less investment, almost 70,000 fewer jobs, and a 4.5 per cent decrease in the province’s economic output (i.e. GDP) by 2040. Ontario would lose more than 15,000 jobs and $2.3 billion from its economy by 2040. And Quebec would lose more than 3,000 jobs and $0.4 billion from its economy during the same period.

Overall, according to Deloitte, Canada would experience an economic loss equivalent to 1.0 per cent of GDP, translating into lower wages, the loss of nearly 113,000 jobs and a 1.3 per cent reduction in government tax revenues. (For context, Canada’s economic growth in 2023 was only 1.1 per cent.)

And what will Canadians get for all that economic pain?

In my study published last year by the Fraser Institute, I found that, even if Canada eliminated all its GHG emissions expected in 2030 due to the federal cap, the emission reduction would equal only four-tenths of one per cent of global emissions—a reduction unlikely to have any impact on the trajectory of the climate in any detectable manner or produce any related environmental, health or safety benefits.

Clearly, the Trudeau government’s new proposed emissions cap on the oil and gas sector will impose significant harms on Canada’s economy, Canadian workers and our quality of life—and hit Alberta with a wallop. And yet, as a measure intended to avert harmful climate change, it’s purely performative (like many of the government’s other GHG regulations) and will generate too little emission reductions to have any meaningful impact on the climate.

In a world of rational policy development, where the benefits of government regulations are supposed to exceed their costs, policymakers would never consider this proposed cap. The Trudeau government will submit the plan to Parliament, and if the cap becomes law, it will await some other future government to undo the damage inflicted on Canadians and their families.

Author:

Kenneth P. Green

Senior Fellow, Fraser Institute

Alberta

Edmonton public school board takes action in defiance of Alberta’s proposed pro-family policies

Published on November 7, 2024

Todayville

From LifeSiteNews

By Clare Marie Merkowsky

The Edmonton Public School Board filed a motion against Alberta’s new policies requiring parents to opt in rather than opt out of sex-ed classes and mandating that parental permission is obtained before a student uses a different pronoun.

An Edmonton school board submitted a motion to defy Alberta’s policy requiring parental knowledge if a child goes by different pronouns at school.

On November 5, the Edmonton Public School Board filed a motion against Alberta’s new pro-family policies requiring parents to opt in rather than opt out of sex-ed classes and mandating that parental permission is obtained before a student uses a different pronoun.

“The Division’s current policy on sexual orientation, gender identity and gender expression is part of our mandate to provide a safe, welcoming and healthy school environment for students, staff and families,” the board claimed in the motion sent to the Board of Trustees.

“The policy changes being proposed by Premier Smith will contradict what our Board, and previous Boards of Trustees, have worked hard to ensure: the safety and well being of all children in Edmonton Public schools,” it continued.

The new policies, introduced last week by Alberta Premier Danielle Smith under Bill 27, will mean that sex-education classes will not be included in a child’s education, and teachers or school staff will no longer be allowed to conceal whether a student begins to use different pronouns or names.

Once Bill 27 becomes law, schools must notify parents of what is being taught at least “30 days in advance and be given the opportunity to opt in rather than opt out of this instruction.”

However, while Alberta is working to keep parents informed and children safe from the radical LGBT agenda, the Edmonton board has argued parents must be kept in the dark to prevent them from stopping their children from accepting the falsehoods of the LGBT agenda.

“For transgender youth who choose a name different from the one given at birth, use of their chosen name in multiple contexts affirms their gender identity and reduces mental health risks, which are known to be high in this group,” the board claimed.

However, significant body of evidence shows that “affirming” gender confusion carries serious harms, especially when done with impressionable children who lack the mental development, emotional maturity, and life experience to consider the long-term ramifications of the decisions being pushed on them, or full knowledge about the long-term effects of life-altering, physically transformative, and often irreversible surgical and chemical procedures.

Additionally, as LifeSiteNews previously reported, many Ontario parents revealed that public schools did not ask for parental consent before “gender transitioning” their children, resulting in child-parent relationships being destroyed.

Furthermore, many teachers struggle to keep secret from parents. A Saskatchewan teacher who wished to remain anonymous previously told LifeSiteNews that she feels guilty about keeping secrets from parents and supports the decision to keep parents informed.

“I fear that we are not supporting students or parents when we keep secrets,” she explained. “We have many students using alternate names, which sometimes changes frequently during the year, and then are asked by parents if we were aware of the changes after the fact. I feel responsible for keeping the secret and I don’t think it’s fair. I think schools are already taking on too many ‘parent roles’ and it’s important that parents play the ‘parent role’ not teachers!”