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Access to tidewater focus of fiscal update

As Alberta’s deficit continues to drop, new economic headwinds pose a potential challenge for the province’s recovering economy if left unchecked.

Compared to last year, 42,000 new jobs were created in the province. Average weekly earnings remain strong and manufacturing sales are up 8.5 per cent.

The deficit has dropped by $1.3 billion since Budget 2018 with the $500 million risk adjustment remaining in place to protect against price volatility. As a result, our government remains on track to balance the budget as planned in 2023.

However this recovery faces a serious threat from the differential. Inadequate pipeline capacity and inaction by the federal government on crude by rail has led to a widening differential. The decline in the price of Western Canadian Select (WCS) over the past months has weighed on Alberta’s economic outlook.

“The Alberta economy continues its second year of recovery with 42,000 jobs created. The deficit continues its decline and we are on track to balance in 2023-24. But our recovery is at risk due to the punishing differential. This is a crisis. Albertans and working Canadians cannot afford to leave $80 million on the table every day. It doesn’t make sense and, if the differential is not addressed, our entire country could be plunged into a downturn. This is a national issue and it’s time Ottawa stepped up and pitched in.”   

Joe Ceci, President of Treasury Board & Minister of Finance

Fighting to get full value for Alberta oil

The Canadian economy is losing more than $80 million a day due to the differential. The Government of Alberta is committed to achieving market access and getting full value for Alberta oil.

“We’re fighting for the Albertans who are struggling because of the punishing differential. We’re going to keep pressing the federal government. And if they won’t act, we will.”

Joe Ceci, President of Treasury Board & Minister of Finance

2018-19 Second quarter forecast ($ millions)

Full-year forecast
Budget 2018
Q2 forecast
Change from Budget

Income taxes

15,938

16,318

380

Non-renewable resource revenue

3,829

5,322

1,493

Other revenue

28,113

27,965

(148)

Total revenue
47,879
49,605
1,726

Operating expense (excluding CLP)

47,765

47,886

121

Climate Leadership Plan operating expense

1,035

1,029

(6)

Disaster/emergency assistance expense

206

459

253

Other expense

7,175

7,243

68

Total expense
56,181
56,617
436

Risk adjustment

(500)

(500)

-

Deficit
(8,802)
(7,512)
1,290
Energy and economic assumptions
Budget 2018
Q2 forecast
Change from Budget

WTI (US$/bbl)

59.00

64.00

5.00

Exchange rate (US¢/Cdn$)

80.0

77.50

(2.5)

Real GDP growth (%)

2.7

2.5

(0.2)


Media inquiries

Government of Alberta