The Government of Alberta has forecasted a budget surplus of $2.4 billion for the 2023-24 fiscal year, August 31, 2023. (Photo: Government of Alberta)

By David Opinko

Alberta forecasts $2.4 billion surplus to end 2023-24

Aug 31, 2023 | 10:00 AM

EDMONTON, AB – The Government of Alberta said it continues to secure Alberta’s future thanks to strong fiscal management.

The province has released its first quarter fiscal update, projecting a budget surplus of $2.4 billion by the end of the 2023-24 fiscal year. That is $94 million higher than what was forecast in February’s Budget 2023, but is still down $9.2 billion from the same period last year.

READ MORE: Alberta ends 2022-23 fiscal year with $11.6 billion surplus

Finance Minister Nate Horner said the government plans to use its fiscal position to eliminate $2.6 billion in taxpayer-supported debt over the coming fiscal year.

“Alberta’s finances remain strong, and thanks to our new fiscal framework, Alberta’s fiscal position is poised to become even stronger,” said Horner. “Our continued priorities of paying down debt and saving for the future will ensure we have the capacity to meet Albertans’ needs both today and well into the future.”

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Revenues

Revenues for 2023-24 are forecast at $71.1 billion, an increase of $491 million from Budget 2023.

The province states that this was mainly attributed to higher-than-projected revenues from personal and corporate income taxes, which is expected to rise by $1.5 billion in 2023-24.

Oil prices are anticipated to see little change throughout the fiscal year, as West Texas Intermediate (WTI) oil averaged $74 US per barrel between April 1 and June 30, 2023. It is now expected to be around $75 for the remainder of the fiscal year, about four dollars less than previously budgeted

Bitumen royalties are projected to rise by $515 million this fiscal year, but overall resource revenue is expected to fall by $694 million from the budget forecast. The drop in revenues will mostly come from natural gas due to weaker prices, the impact of wildfires on production in Alberta, and robust production elsewhere in North America.

Expenses

The government expects that overall expenditures in 2023-24 will be $68.7 billion, up $397 million from prior estimates in Budget 2023. The agency said a large part of that is due to Alberta’s record-breaking wildfire season.

The province allocated $750 million to fight wildfires this year in addition to $175 million in uninsurable losses.

Although the budget shows a $214 million increase in health spending, it is being fully offset by revenues from the federal bilateral agreement.

Economic Outlook

The province said it expects Alberta’s economy to continue to perform strongly in the coming months and years.

Real GDP is forecast to rise by three per cent in 2023, up 0.2 per cent from the Budget 2023’s estimation. Alberta is projected to lead Canada in economic growth.

According to the government, the provincial economy is being boosted by robust population growth.

“Although risks and uncertainty persist due to rising interest rates, high consumer prices and other factors, Alberta’s economy remains well-positioned to withstand any challenges that arise,” reads a media release from the Government of Alberta.

The full 2023-24 First Quarter Fiscal Update and Economic Statement can be found on the Government of Alberta website.

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