Alberta Budget 2024 TLDR

Here’s a quick snapshot of what you need to know about Alberta’s budget in 2024. 

This is an austerity budget

Government spending is up a little, but population growth and inflation are up a lot. This effectively means cuts across the board. Instead of increasing funding to keep up, the Smith administration has decided to squirrel away $2 billion into the Heritage Savings Trust FundThis is a textbook austerity budget.

We don’t have a real surplus, but there is an “accounting surplus”

The government of Alberta is anticipating an “accounting surplus” of $367 million in 2024-25. This is after the government ran surpluses of $11 billion in 22-23 and $5.2 billion in 23-24. But a lack of ready cash means that the government will still be borrowing in order to meet commitments this year, leading many confused reporters this morning to ask why the government is claiming a surplus at all.

Toews’ Alberta Fund has flopped

The “Alberta Fund” is no more. The slush fund created by Travis Toews in the 2023 budget has gone the way of his political career. "The purpose of the Alberta fund is to bring discipline to the use of the surplus," said Toews a year ago. The next UCP finance minister Nate Horner got rid of it in one go. 

Finance Minister Nate Horner answering questions about the 2024 Alberta budget in an embargoed press conference.

You’ll get to pay the fuel tax even if you don’t buy fuel

The UCP are bringing in an electric vehicles tax. It will be $200 per electric vehicle starting January 1, 2025. The tax will be paid when owners register their vehicles. The government said that the amount is similar to the estimated annual fuel tax paid by a driver of a typical internal combustion vehicle in Alberta. The new tax will not apply to hybrids. The tax is expected to raise  $1 million in 2024-25, $5 million in 2025-26 and $8 million in 2026-27.

Smokers and vapers will pay a bit more

In a move that would surely disappoint a younger Danielle Smith, the budget increases taxes on cigarettes by 2.5 cents per cigarette, bringing the total to 50 cents per 20 pack, or $60 per carton, as of March 1. 

The provincial government is joining the feds’ vaping tax framework of $1 per two mL for the first 10 mL of vaping substance in a product and $1 per each remaining 10 mL, or fraction thereof. 

We finally got the bill for selling off Alberta’s labs and then buying them back

We now know the full cost of the decision to privatize lab services to Dynalife and then acquire them back when they couldn’t do the job – $31.5 million. Back in 2022 the UCP said the 25 year deal (which lasted a year) would save between $18 million to $36 million

The Sturgeon Refinery is still bleeding money

The Sturgeon Refinery continues to be an open sore on the government’s finances. From 2023 to 2037 the Alberta government is forecasting it will lose $1.769 billion on the project. Back in the summer of 2021 the UCP government at the time took a 50 per cent stake in the project and extended the processing deal another ten years. The UCP government said that the restructured deal would save the people of Alberta $2 billion over the life of the project.

The government admits public sector wages are going to rise, but is conservative in its estimate

The budget acknowledges that yes, public sector compensation will increase over the next three years. Between 2023 and 2027 the government is forecasting that compensation for public sector workers  will increase by roughly 8 per cent over that time. That’s roughly in line with the government of Alberta’s initial offer to the United Nurses of Alberta of 7.5 per cent over that same time frame. It is obviously not in line with the UNA’s initial offer of a 25 per cent in compensation. 

Health care funding per Albertan continues to erode.

Per capita funding for health care in Alberta does not keep pace with population growth and inflation in this budget. The government expects Alberta’s population to increase by about 3.7% and for inflation to be about what the consumer price index (CPI) estimates, about 3.4%.

Put together population growth and inflation are pressing the health care budget by 7.2% according to the government’s estimates. But general operational funding on healthcare is only increasing by 4.4%.

As part of Smith’s promised “refocusing” of health care in Alberta, many responsibilities are being reassigned away from AHS, in particular mental health care and care for addictions. However, operational spending for mental health care and addictions care is actually down in this budget 5% compared to 2023.

The province is touting an over $1 billion investment in mental health care and addictions care, but this is nearly all capital spending—building new facilities—and capital projects take time to complete, if they complete at all. $200 million of the budgeted capital investments for health from 2023 still haven’t happened.

4.4% funding growth versus 7.2% expense growth is already a cut, but some parts of the system will shoulder more of it than others. The government is budgeting 8% more to pay doctors, but barely 1% more for acute care, so your family doctor may not be getting hit hard here but your local hospital certainly is.

Read more about the 2024 budget health-care spending here.

Privatization of education continues apace.

K-12 education funding is getting a 4.4 per cent increase to $9.3 billion this year, with $843 million set aside for enrollment growth, which is expected to increase by about 33,000 students this year.

The amount of operational funding specifically dedicated to private schools and daycares, however, increased 13 per cent to $408 million from $355 million, which is also intended to account for enrollment growth. 

On the advanced education side, the cost of operating post-secondary institutions increased to $5.65 billion from $5.57 billion last year. The government says it’s providing $2.5 billion in various forms of grants to post-secondary institutions, meaning the rest is funded by the institutions themselves, with the bulk of that funding offloaded onto students in the form of tuition. 

The government increased student aid for programs at private career colleges by $76.3 million for 2024/25, with just $1.6 million of the new funds coming in the form of scholarships and the rest consisting of loans.

The Alberta government is getting into the home equity loan business.

Will the government find someone with the star power of Kurt Browning (who shills for reverse mortgages on television on the regular) to sell their new home equity loans? Budget 2024 allocates $536.4 million to grants and low-interest home equity loans through as-yet-identified seniors financial assistance programs. The government claims this will help more than 189,000 low-income seniors meet their basic needs. There is a long list of celebrities this government might enlist to sell their “Mortgage your home to buy food!” program so we’re not even going to touch that.