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Alberta Councel Budget 2021 a Comprehensive Overview of The Budget 2021 A comprehensive overview of the 2021-2024 Alberta Fiscal Plan Legal and Lobby Professionals Budget 2021 Table of Contents General Budget Overview………………………………………………………………………...3 Advanced Education…………………………………………………………………………….…5 Agriculture and Forestry……………………………………………………………………….…..9 Children’s Services………………………………………………………………………………...13 Community and Social Services……………………………………………………….…………16 Culture, Multiculturalism and Status of Women………………………………………………...20 Education……………………………………………………………………………………….…...23 Energy…………………………………………………………………………………………….…27 Environment and Parks……………………………………………………………………………31 Health…………………………………………………………………………………………….….36 Indigenous Relations………………………………………………………………………………42 Infrastructure……………………………………………………………………………………….46 Jobs, Economy, and Innovation………………………………………………………………….49 Justice and Solicitor General…………………………………………………………………..…52 Labour and Immigration………………………………………………………………………..…55 Municipal Affairs…………………………………………………………………………………….59 Seniors and Housing……………………………………………………………………………….64 Service Alberta………………………………………………………………………………………67 Transportation……………………………………………………………………………………….71 Treasury and Finance……………………………………………………………………………….75 2 | Page Legal and Lobby Professionals Budget 2021 General Budget Overview The last provincial budget was tabled in the Alberta Legislature prior to the first set of public health restrictions in 2020, effectively rendering that fiscal plan out-of-date shortly after it was released. Budget 2021 is the first comprehensive fiscal plan released since the onset of COVID-19 in the province and provides us with a more clear understanding of the direction that this United Conservative administration will take for the remainder of their first term. This document is intended to be a brief ministry-by-ministry summary of Budget 2021 that can be used for your reference. Each section will provide funding highlights, statements of operations, capital plans, ministry objectives, and important notes from each of the ministries listed in the table of contents. The following paragraphs will cover many of the key indicators that the provincial government uses to gauge fiscal health. Deficit and Debt The Government of Alberta is projecting our budget deficit to extend well beyond the range of the 2021-24 Fiscal Plan. The estimated deficit for the next fiscal year is $18.2 billion dollars which represents a $3.1 billion improvement from the mid-year fiscal update last November. Budget 2021 projects a further decrease of the deficit to $11.0 billion in 2022-23 and a target of $8 billion in 2023-24. Taxpayer supported debt has skyrocketed to an estimated $115.8 billion this year. Unfortunately, this is projected to continue increasing for the remainder of the budget forecast, climbing to $132.5 billion in 2023-24.The province will set aside $2.7 billion in debt servicing costs this year. Our current debt-to-GDP is sitting at 24.5%, eventually reaching 26.6% in 2023-24. Speaking of, real GDP is projected to grow by 4.8% this upcoming year followed by sustained growth of 3.7%. 3.3%, and 3.1% in the following three years. Revenue Alberta is projecting to raise $43.7 billion in revenue this upcoming fiscal year which represents and increase from the November fiscal update. This is being accomplished with no PST or HST being announced through changes to income tax, natural resources and government business enterprise income. Revenue will rise to $47.4 billion in 2022-23 and continue to increaser the following year to $50.9 billion. The Heritage Savings Fund will see a marginal increase to $16.7 billion in 2021-22 and will continue to slowly grow to $17.3 billion in 2023-24. 3 | Page Legal and Lobby Professionals Budget 2021 The Budget looks quite bleak with respect to assets and liabilities. Financial assets have been reduced by millions to $71.1 billion this upcoming year while liabilities have grown at a sig- nificantly greater rate to $153.3 billion. That means we are in for a net asset total of negative $26.9 billion. Our net asset deficit will continue to escalate for the remainder of this budget’s projections and will eventually reach negative $45.9 billion in 2023-24. Also on the revenue front, WTI has been soaring as of late which has resulted in stronger projections than we saw in the November update. It is currently projected at 46.00US$/bbl for 2021-22 with increases to 55.00US$/bbl and 56.50US$/bbl over the following two years. On a related note, the cancellation of the Keystone XL pipeline by Untied States President Joe Biden has created an estimated exposure of nearly $1.3 billion to the provincial budget. $384 million of that coming out of equity; $892 million in loan guarantees. Capital Spending and Employment The provincial government has increased the funding allocated to the Capital Plan mostly out of necessity to spur economic growth due to the effects of the pandemic. $1.7 billion in addi- tional funding has been attributed to the plan over the next three years for a cumulative total of $20.7 billion. Municipalities will be particularly interested in the changes to the Municipal Sustainability Initiative (MSI) which include an extension of the program along with front end funding announced (more on this later on in this summary). Alberta’s unemployment rate will see a steady decline, but unfortunately will take a number of years to return to pre-pandemic levels of 7.0% in 2019. We are expected to hover around 9.9% this year, 8.4% in 2022, 7.3% in 2023, and finally dropping to 6.3% in 2024. Speaking to net-migration, the province is only expecting around 3,700 new people to arrive in Alberta this year. We will surge past pre-pandemic numbers to 39,000 in 2023 and 42,300 in 2024. Conclusion An unusual year calls for an unusual budget. The province will be facing some challenging fis- cal times for the foreseeable future and whoever forms the new government in 2023 will carry the financial burden for a good portion of their term (if not the entirety). If the province decides to move forward with changes like creating a provincial police force, tax collection system, or pension plan, Budget 2022 will no doubt come with new complexities and challenges that are unknown today. We hope this document helps your organization better understand Budget 2021. 4 | Page Legal and Lobby Professionals Budget 2021 Advanced Education Minister Demetrios Nicolaides Overall Funding There is $5.055 billion in operating expenses for Advanced Education, an overall decrease of 1.4% ($72 million less than the previous year.) This is substantially less than the $5.6B fore- casted for 2022 in last year’s budget. Budget 2021 will introduce the previously announced performance-based funding, where a portion of operational funding will be contingent upon achieving specific performance outcomes. Funding Highlights •Campus Alberta Grant will be $114 million less with and investment by Advanced Education of $2.2 billion in operational funding in fiscal 2020-21 for operating support for post-secondary institutions. •Foundational Learning Supports $96 million in 2020-21, providing formal learning programs intended to assist adult Albertans pursue further learning or find meaningful employment as well as program delivery support costs. •Revenue from tuition has decreased by 6.23% in 2020-21 from the 2019-2020 year, despite recent tuition increases. •Tuition fees collected are expected to be $1.47 billion, slightly less than previous year but is expected to rise to $1.6 billion in 2022-23. •In 2017-18, provincial grants represented 47% of the total revenue for Alberta’s publicly fund- ed universities and degree-granting colleges. Higher than similar institutions in British Colum- bia (34%) and Ontario (26%). Alberta is targeting a lower provincial grant percentage 42% by 2021-22. •The University of Alberta’s Li Ka Shing Applied Virology Institute at the will receive $20 million in government funding over the next four years to accelerate leading-edge research and com- mercialization of pharmaceutical and vaccine treatments as part of the province’s COVID-19 response and economic recovery plan. •The Women Building Futures program will receive $7.5 million over the next three years to support women who wish to pursue opportunities in skilled trades. •$1 million for trades scholarships for 1,000 students who show promise in trades in high school and create the $1 million Alex Decoteau Veteran’s Scholarship of Honour to provide $5,000 post-secondary scholarships to members of the Royal Canadian Forces from Alberta who have served in designated military operations. •It is expected that 750 jobs will be lost, many through attrition. There is not yet a detailed breakdown of where these 750 jobs will come from. 5 | Page Legal and Lobby Professionals Budget 2021 Statement of Operations 6 | Page Legal and Lobby Professionals Budget 2021 Capital Investment Outcome 1: Albertans have the education and skills required to secure rewarding ca- reers in the current and future labour market, and to drive Alberta’s recovery and pros- perity Through high-quality post-secondary education, including expanded and strengthened appren- ticeship opportunities, Albertans build the knowledge, skills and competencies needed for re- spected, well-paying careers that contribute to economic growth and diversification. Advanced Education is committed to working with employers, learning providers and other stakeholders to ensure Albertans have the lifelong skills, knowledge and competencies they need to excel.
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