Alberta’s 2024 budget forecasts a $367 million surplus for 2024-25, continuing the government’s strategy of maintaining balanced budgets. Projections indicate future surpluses of $1.4 billion by 2025-26(
KPMG)(
RBC Thought Leadership). These surpluses, combined with careful fiscal management, aim to keep Alberta’s net debt-to-GDP ratio the lowest in Canada, with a target to reduce it from 9.3% in 2024-25 to 7.7% by 2026-27(
Resource Revenue and Economic Assumptions
Alberta remains heavily dependent on resource revenues, but the 2024 budget anticipates an 11% decline in this income due to weakened commodity markets(
RBC Thought Leadership). Oil prices, a key driver of Alberta’s economy, are conservatively budgeted at $74 per barrel of West Texas Intermediate crude(
Despite this, Alberta’s government is optimistic about economic growth, forecasting real GDP growth of 2.9% in 2024, much higher than private sector estimates of 1.3%(
RBC Thought Leadership). The government also projects employment growth at 3%, which is well above industry consensus forecasts(
Healthcare Investments
Healthcare is a major focus of the 2024 Alberta budget, with the government allocating $26.2 billion to improve services, an increase of 4.4% from the previous year(
KPMG)(
Alberta.ca). Key areas include:
- Primary care reform, with $475 million directed to frontline healthcare services(Global News).
- Increased funding for community and seniors’ care, especially supplemental healthcare programs for aging populations(RBC Thought Leadership).
- Enhanced physician compensation and expanded access to pharmaceuticals and mental health services(Global News).
Education and Parental Choice
The 2024 budget emphasizes educational infrastructure to accommodate Alberta’s growing population. Education spending will rise by 4.4%, with $680 million allocated for new schools and renovations to create 35,000 additional student spaces(
Further, $24 million over the next three years will fund the expansion of private schools and early childhood services, reinforcing the province’s commitment to parental choice in education(
Infrastructure Development
Alberta continues to invest in infrastructure to support its expanding population and resource-based economy. The capital plan allocates $25 billion over three years, with $8.3 billion earmarked for 2024-25(
RBC Thought Leadership). Key projects include:
- Expansions of light rail transit systems in Calgary and Edmonton(Alberta.ca).
- Investments in highway and road upgrades, particularly in rural areas(RBC Thought Leadership).
- New and improved healthcare facilities, including hospitals(Alberta.ca).
New Tax Policies and Incentives
The 2024 budget introduces several new tax initiatives aimed at addressing revenue gaps and attracting skilled workers:
- A new personal income tax bracket for income up to $60,000 will be phased in, with a rate of 9% in 2026, reducing to 8% after 2026(PwC)(RBC Thought Leadership). This tax cut is projected to cost $1.4 billion annually by 2027(RBC Thought Leadership).
- A $200 annual tax on electric vehicles will be introduced in 2025 to account for road maintenance costs due to heavier vehicles(KPMG)(RBC Thought Leadership).
- The “Alberta is Calling” attraction bonus, offering a $5,000 refundable tax credit, aims to bring skilled workers into Alberta starting in April 2024(PwC).
Social Services and Disaster Planning
Although healthcare and education are prioritized, the 2024 budget reduces spending in several areas of public service. Public safety, emergency services, and seniors’ programs will see a combined cut of $351 million(
In terms of disaster planning, the budget sets aside $2 billion as a contingency fund for emergencies such as wildfires(
Global News). This is significantly less than last year’s estimated emergency spending but provides a buffer for future crises.
Long-Term Savings and the Heritage Fund
A critical aspect of Alberta’s fiscal strategy is contributing to the Heritage Savings Trust Fund to reduce dependency on resource revenues. The 2024 budget allocates $2 billion to this fund, bringing its total value closer to $25 billion(
Alberta.ca)(
RBC Thought Leadership). Premier Danielle Smith has set a long-term goal of growing the fund to $250 billion by 2050(
PwC).
This commitment to long-term savings is crucial for Alberta’s ability to manage future economic downturns and reduce reliance on fluctuating resource royalties.
