Pandemic spending, no tax increases: Some highlights from the Alberta budget

  • Pandemic spending, no tax increases: Some highlights from the Alberta budget

Pandemic spending, no tax increases: Some highlights from the Alberta budget

On Thursday, provincial Finance Minister Travis Toews said Albertans should "stay tuned" for an official announcement on the Alberta Jobs Now program, which is expected to provide a grant to eligible employers to provide Albertans opportunities to upgrade their skills as well as to encourage employers to create jobs to get unemployed Albertans back to work.

The province's surgical initiative, aimed at lowering surgical wait times, will see $30 million in capital spending this year, and a total of $120 million over the next three years. That's on top of $5.8 billion in COVID-19 spending previous year.

"As much as I hate deficits, now would be the worst time to cut billions of additional dollars in spending when we need it in health care and we need it to help stimulate economic growth", he said this week.

Opposition Leader Rachel Notley said the budget fails on multiple fronts.

- $3.1 billion to diversify economy and expand aviation, tech, pharmaceutical and tourism sectors.

"It's a little bit of a deer in the headlights budget".

"Alberta's government is laser-focused on protecting lives and livelihoods and that's exactly what Albertans can expect from this legislative session", says Premier Jason Kenney, in a press release.

Alberta's COVID-19-era budget made a hard landing Thursday with an $18.2-billion deficit but also a promise that good times will return.

Non-renewable resource revenues, the traditional foundation of Alberta's economy, are expected to bring in $2.9 billion, about half of what they were before the pandemic. "It's a budget that protects our health-care system and positions Alberta to emerge from COVID-19 stronger than ever", said Toews. The interest on the debt will cost $2.8 billion, or more than $600 per Albertan, every year.

- Corporate income tax estimated to be $1.9 billion. Real gross domestic product, or GDP, is expected to rise 4.8 per cent this year after a 7.8 per cent decline in 2020.

"We're focused on what we can manage ... and we're looking to ensure that we're delivering government services most efficiently".

Some $26.7 billion of the provincial budget is spent overall on public sector compensation.

Toews said the United Conservative government remains committed to reducing public-sector, per-capita spending to match that in comparable provinces such as British Columbia and Ontario. Alberta is now the only province without a PST.

The 2021-22 budget predicts a deficit of $18.2 billion and debt ballooning to a record $115.8 billion by the end of the year.

The fiscal plan calls for $57 billion in spending, along with a minimum $1.1 billion to fight COVID-19 and another $1.8 billion in pandemic spending if needed. The NDP government created the crude-by-rail plan in their governing term after hitting roadblocks getting pipelines out of the province approved, but the UCP squashed the program once elected. So how they can build into the budget a preconceived outcome? The province invested $1.5 billion in the pipeline, which was killed when U.S. President Joe Biden was inaugurated in January. This change is primarily due to rapid vaccine development, economic activity and demand for oil that is expected to follow.

"Alberta's economy is now expected to reach pre-COVID levels by 2022, one year earlier than expected", Toews told a news conference prior to introducing the 2021-22 budget in the legislature.

A recent sharp increase in oil prices in the past few weeks sent West Texas Intermediate (WTI) up to $55 from $45, but the province won't be betting the farm on those high oil prices. For this coming year, Alberta is estimating oil prices to average out to $46, and climb to $56.50 by 2023-24.