February 29, 2024

Alberta budget shows priorities in the right place for long-term success

EDMONTON, ALBERTA—Alberta’s business community welcomes Budget 2024 and applauds the investments made to address urgent short-term challenges while also setting the province on a path towards a more fiscally sustainable future. Delivering such a budget while forecasted revenues soften and population growth drives demand for new spending is no easy task. But this budget has struck a pragmatic balance across competing priorities by making several strategic investments that will improve productivity and competitiveness, attract new business activity, and create opportunity and prosperity for all Albertans.

“This budget helps set Alberta up for future success, with important investments in decarbonization and post-secondary while staying within a fiscal framework, something that the Council has advocated for and supported,” says Adam Legge, President of the Business Council of Alberta. “It strikes a prudent balance between short-term needs and long-term goals. In the face of slower economic growth, it takes steps to meet the needs of a growing population, while also balancing the budget and saving for the future.”

In a pre-budget submission, the Council asked the provincial government to consider three priorities for business and the prosperity of Alberta:

  1. Incentivizing investment in decarbonization;
  2. Investing in post-secondary education; and
  3. Sticking to the fiscal rules as laid out in Budget 2023.

Budget 2024 take steps forward on these three priorities for the benefit of businesses and the prosperity of all Albertans.

On incentivizing investment in decarbonization, we were pleased to see the Alberta Carbon Capture Incentive Program (ACCIP), introduced in November, begin to take shape. While funding availability is still contingent on the federal government legislating its proposed carbon capture investment tax credit, we are glad to see Budget 2024 forecast $226 million to be available for ACCIP from the Technology Innovation and Emissions Reduction (TIER) Fund by the end of this fiscal year; and another $167 million expected from the same fund over the next three years. Stacked with the proposed federal incentives, the ACCIP represents another step towards seizing Alberta’s potential as a low-carbon provider of power, resources, and manufactured goods.

“Decarbonization has the potential to create an investment windfall in Alberta—one that would help create thousands of new jobs, promote globally-competitive natural resource exports, and attract new industries to the province,” says Mike Holden, Vice President of Policy & Chief Economist for the Business Council of Alberta. “But we need to get all the policy pieces right to unlock it—both provincially and federally. The actions included in this year’s budget are a step forward in positioning Alberta for success.”That said, we were hoping to see a provincial commitment to operationalize carbon contracts for difference (CCfD) for carbon capture projects by diverting TIER Fund allocations from debt reductions to a CCfD program. While we did not see such movement in this budget, we are still hopeful that the provincial and federal governments can cooperate on the design and funding of a fully funded, easy-to-access CCfD program in the near future.

On investing in post-secondary education, the Council is pleased to see the budget invest in creating capacity in critical areas where Council members have noted significant labour shortages. In particular, we anticipate that the $102 million in additional funding provided over the next three years to create 3,200 apprenticeship seats in high-demand areas; and the additional grant funding provided for apprenticeship learning can begin to tackle skills shortages and attract young talent to career paths that are in high-demand. We are also pleased to see additional funding announced to help attract and retain medical professionals in underserved rural communities through the new Rural Health Professional Training Centres.

“Alberta’s labour market is shifting. We’re seeing a surge in demand for occupations in the trades, as well as a shortage of ‘middle skilled’ labour,” says Holden. “We’re pleased to see this budget invest in apprenticeships and developing these needed skills. We encourage the provincial government to continue responding to accommodate the thousands of new students expected to enter the post-secondary system in the coming years.”  

Alberta’s disproportionately large cohort of young Albertans entering the post-secondary education system is anticipated to put considerable capacity pressure on these institutions in the coming years. While we support the government’s efforts to stick to their fiscal rules on a whole-of-budget basis, post-secondary institutions (PSIs) are going to require significant capacity investments in the near-term to meet this demand. Budget 2024 indicates that the province expects to decrease their share of PSI funding from 47% last year to 42% by 2026/27. The Council will be closely monitoring the potential impacts on institutional capacity that this could create.

On sticking to the fiscal rules, the Council is pleased to see Budget 2024 show a reasonable level of fiscal restraint. Last year Alberta saw another significant budgetary boost from resource revenues, but we cannot rely on windfalls to balance the budget. And as economic forecasts soften, the province expects less revenue than before, resulting in smaller surpluses. However, we’re pleased to see a commitment toward ongoing spending discipline, including a significant portion of the surplus from 2023 being allocated to the Heritage Fund and debt repayment so that future Albertans can benefit from our resource wealth. 

“Inflation, interest rates, oil price volatility, and lower forecasted surpluses weigh on the province’s fiscal position, and we must ensure that Alberta is fiscally strong over the long term,” says Holden. “This budget continues a prudent path towards fiscal sustainability.”

Beyond our stated priorities, the Council was also pleased to see a boost to Wildfire Management Program funding, capital investment in future firefighting equipment, repairs and upgrades to water infrastructure and the Renewed Flood and Drought Mitigation program, and an increase to the contingency fund to prepare Alberta for the likelihood of facing some tough challenges related to wildfire and drought mitigation and response. 

Budgets signal government priorities for the upcoming year, and we look forward to continuing to work with the provincial government to implement some of the plans within this budget, and in line with the Define the Decade economic strategy developed by Albertans.


About the Business Council of Alberta. The Business Council of Alberta is a non-partisan, for-purpose organization dedicated to building a better Alberta within a more dynamic Canada. Composed of the chief executives and leading entrepreneurs of the province’s largest enterprises, Council members are proud to represent the majority of Alberta’s private sector investment, job creation, exports, and research and development. The Council is committed to working with leaders and stakeholders across Alberta and Canada in proposing bold and innovative public policy solutions and initiatives that will make life better for Albertans.

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