EDMONTON, ALBERTA—Today Alberta launched its 2023 budget from a position of record economic strength, and the business community welcomes the actions taken to use that strength to set Alberta up for long-term prosperity.
“This budget does a nice job balancing short-term needs and long-term strategy,” says Adam Legge, President of the Business Council of Alberta. “This, and the next several budgets, need to be about using our position of strength to set Alberta up for long-term prosperity. In this regard the budget made several significant moves including implementing important fiscal rules, investing in Alberta’s economic future, and maintaining the smart spending band,” says Legge.
In a pre-budget submission, the Council asked the provincial government to commit to three things: economic expansion, long-term sustainability, and supporting a good life.
On expanding the economy, the Council was pleased to see important investments such as the Agri-processing Investment Tax Credit for investments over $10 million; funding increases for education and training in high-demand occupations; and ongoing commitments to expand broadband services in rural areas.
We were also pleased to see signals toward a low-carbon industrial strategy for the province, notably an expansion of the Alberta Petrochemicals Incentive Program to support clean hydrogen development as well as investments in future carbon capture through Carbon Capture and Storage Initiative and the TIER fund.
“Alberta’s fiscal and economic picture is incredibly strong: Alberta is leading Canada in economic growth; employment is generally above pre-COVID levels; net in-migration is at the highest level since the early 2000’s; and our fiscal situation is better than it has been in decades,” says Legge. “From this place of relative strength, we can make decisions that not only support Albertans through the short-term challenges but enable us to make the strategic decisions to set up future generations for success. This budget reflects this in several ways, and also has a few opportunities for improvement.”
On supporting a good life, the Council was pleased to see continued support for Alberta families to help them cope with the rising cost of living; however, we were disappointed to see that similar levels of support do not appear to have been extended to lower-income Albertans without children.
We were also pleased to see significant investments to ensure Alberta’s health care system delivers the best outcomes for Albertans, including $158 million to increase the number of health care professionals and new funding to decrease ambulance and emergency room wait times. There was additional funding for addiction recovery and youth mental health services, although this fell short of our recommendation for a comprehensive physical and mental wellness strategy.
On long-term sustainability, the Council is pleased to see the province in strong fiscal shape. This has been driven by the dual forces of prudent fiscal management to bring spending in line with comparable provinces and the significant surpluses expected from royalty revenues. We must ensure that we use our fiscal strength to make strategic decisions to enable long-term economic and social prosperity.
It is very positive to see much of this surplus used for debt repayment, as the Council recommended in a recent paper. This, in addition to retaining income generated from the Heritage Savings Trust fund and new fiscal rules, can provide for a far more stable and managed fiscal future that will benefit future generations.
“Fiscally, I am most pleased with two aspects to see the budget stay within the smart spending band—in line with population growth and inflation–and a thoughtful set of fiscal rules for the future. While a resource revenue windfall has occurred this year, this kind of fiscal management will pay dividends if we can stick to it,” says Legge.
“In the short term, we continue to recommend allocating the remainder of the surpluses according to BCA’s Three Big Rocks formula: investing in the Heritage Fund, paying down debt, and investing in strategic projects. We also continue to advocate for a strategic reimagining of Alberta’s overall fiscal model, in the next government mandate.”
Budgets generally signal government priorities for the upcoming year, and we look forward to working 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.
As we anticipate an election later this year, the Business Council of Alberta will be releasing an election policy platform shortly that contains a suite of recommendations for the future provincial government to consider as it plans for the next four years in Alberta.
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.