A provincial state of emergency remains in effect due to numerous wildfires.
For wildfire related information, call the 24-hour info line at 310-4455 (available in 200+ languages) or visit alberta.ca/emergency.
A provincial state of emergency remains in effect due to numerous wildfires.
For wildfire related information, call the 24-hour info line at 310-4455 (available in 200+ languages) or visit alberta.ca/emergency.
Alberta’s fiscal performance improved late last fiscal year with a smaller deficit resulting from both higher revenue and lower spending than predicted in the previous forecast.
Alberta ended the 2020-21 fiscal year with a deficit of $16.9 billion, which is $3.2 billion lower than the third-quarter forecast. Oil prices and other economic indicators trended upwards as the year came to a close, which boosted government revenue. Compared with the previous expense forecast, the government held the line on spending while sticking to its commitments to keep Albertans safe, protect their livelihoods and support job creation during the pandemic.
“Last year was very difficult for many Albertans, but the province is emerging stronger than expected. The government took bold action to support job creation, build infrastructure and diversify our economy, and we are determined to carry this momentum forward, while remaining committed to our fiscal anchors.”
Revenue for 2020-21 was $43.1 billion, which is $0.8 billion higher than the third-quarter forecast reported in Budget 2021. The increase is due mainly to stronger-than-expected oil prices in the last quarter of the fiscal year. With the strong improvement in energy prices and economic activity late in the fiscal year, revenue from oil sands royalties and corporate and personal income taxes also increased from the third quarter forecast.
Financial markets picked up steam in the latter months of the year, which boosted investment income. Revenue from premiums, fees and licences also improved significantly. For example, strong North American lumber prices bolstered the province’s income from timber royalties.
Total expense in 2020-21 was $60.1 billion, which is $2.4 billion lower than the third-quarter forecast. Of particular note, there is a decrease in non-COVID related operating expenses of $1.2 billion from Budget 2020, which demonstrates the government’s commitment to the responsible use of taxpayer dollars.
At the same time, expense was $2.8 billion higher than originally budgeted for due to the COVID-19 pandemic, protecting jobs and supporting economic recovery. In 2020-21, support for the pandemic response and Alberta’s Recovery Plan totalled $5.1 billion, plus $460 million in capital investments. The government also deferred billions of dollars in fees and taxes to help Albertans through the pandemic.
Key actions taken in 2020-21 in response to the pandemic include:
Spending continues to be anchored by sound fiscal principles that ensure the government is fiscally responsible with Albertans’ tax dollars. This past November, Alberta’s government committed to keep the ratio of net debt to gross domestic product (GDP) below 30 per cent. This ratio compares what Alberta owes with the size and strength of its economy. Alberta’s overall level of debt remains low compared to most other provinces. Alberta is also aligning its overall spending levels with other comparable provinces to ensure taxpayers are getting value for every dollar spent. Lastly, the government is committed to setting a timeframe for balancing the budget and repaying debt. This will be done once the pandemic is over and government has a clearer idea of the long-term global impacts.
Alberta’s economy is emerging from the depths of the downturn. While Alberta’s real gross domestic product (GDP) contracted by an estimated 8.2 per cent in 2020, many economic forecasters have predicted that Alberta will lead all provinces in growth this year, including the Conference Board of Canada, BMO, CIBC and Desjardins. As of May, Alberta has already recovered about 86 per cent of the jobs lost between February 2020 and April 2020.
Full versions of the Government of Alberta’s annual report and performance results are available online.