Alberta Finance Minister Jason Nixon presents the 2022-23 Q1 fiscal update and economic statement on August 31, 2022, file photo. (Image: Government of Alberta)

By David Opinko

Alberta to use $13.2 billion surplus to pay down debts

Aug 31, 2022 | 11:44 AM

EDMONTON, AB – The Government of Alberta is reporting strong economic gains and a budget surplus in its latest fiscal update.

In the 2022-23 First Quarter Fiscal Update and Economic Statement, the provincial government is running a budget surplus of $13.2 billion. That is $12.6 billion higher than what had been previously forecast.

In a video posted to social media on Tuesday, August 30, 2022, Premier Jason Kenney said the budgetary recovery was largely due to soaring commodity prices and royalty revenues, but also fiscal restraint and broader economic growth.

A media release from the province highlights several other positive economic indicators such as the addition of 68,200 jobs since the beginning of 2022, the unemployment rate falling to its lowest level since 2015 at 4.8%, and expected real GDP growth of 4.9% in 2022.

READ MORE: Alberta & Saskatchewan expected to lead economic growth in Canada

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Finance Minister Jason Nixon says his administration plans to use the surplus to make historic investments in savings and debt reduction.

“For too long, governments in Alberta refused to exercise fiscal discipline during boom times. Those days are over,” says Nixon. “Alberta’s government is making the prudent decision to save and invest surplus revenues so future generations can benefit from the prosperity of today.”

Taxpayer debt in Alberta as of March 31, 2023, is forecast to be $79.8 billion, about $10.4 billion less than what had been estimated in this spring’s budget.

READ MORE: Alberta presents balanced budget for 2022

The government is adding $1.7 billion to the Heritage Savings Trust Fund, a long-term savings account that funds programs across the province from the interest it generates. The Heritage Fund will now have a total of $2.9 billion.

The province will also recommit to indexing personal income taxes to inflation, retroactive to the 2022 tax year. The basic personal tax amount is rising to $19,814 and will increase again in 2023.

This means that about another 80,000-95,000 Albertans will join the 1.3 million tax tax filers who already pay no provincial personal income tax.

Kenney says indexation will save the average taxpayer around $300 when they file their taxes this coming spring.

“Alberta’s commitment to fiscal discipline and our unrelenting focus on economic growth has helped bring about an extraordinary turnaround in our financial situation,” says Kenney. “We promised Albertans we would get our fiscal house in order and that’s exactly what we’ve done. Now, we’re paying down debt so future generations won’t have to, saving more for a rainy day, and putting more money in Albertans’ pockets.”

Not everyone was happy with the UCP’s plans for how the budget surplus would be used.

NDP Energy Critic Kathleen Ganley says Albertan families will not benefit from the financial windfall and that many are struggling to make ends meet.

READ MORE: UCP failing to use surplus to help Albertans, says NDP

The full report on the 2022-23 First Quarter Fiscal Update and Economic Statement can be viewed on the Government of Alberta’s website.

READ MORE: Alberta on track for $13.2B surplus, Kenney says ahead of fiscal update

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