Budgets 23 and Budget 23 will also serve as the 22/25 Third Quarter Fiscal Update. Budget 23 secures Alberta s future by growing and diversifying the economy, strengthening health care and education, improving the safety of communities across the province, and establishing a new fiscal framework.
00:13:23.680And everywhere I traveled in my pre-budget consultations,
00:13:26.140Albertans were concerned about our health care system.
00:13:28.560That's why we're increasing health care funding by 4% this year.
00:13:32.960Almost a billion dollars in one year alone to ensure that Minister Copping and all the great folks in our health care system have the funds they need to improve, transform the system to deliver better for Albertans.
00:13:46.380To reduce surgical wait times, to reduce wait times in emergency rooms, to reduce the wait times for our paramedics to get out and assist somebody in an emergency.
00:13:57.020Now, the other thing, Graham, we did is we supported Albertans at a time of inflation, at a time when affordability is a challenge, right across the province.
00:14:09.400And so, again, we signaled our affordability support in our mid-year report.
00:14:14.320Of course, this budget funds a number of affordability measures, certainly in the upcoming budget year and even in the future years.
00:14:22.740But again, that's simply a response to the fact that, you know, in Alberta, over the last three years, we did the heavy lifting fiscally.
00:14:33.480We're running a surplus, thanks to very high energy prices, a very significant surplus in the current fiscal year.
00:14:40.080All of that gave us the ability as a government to support Albertans during a time of affordability challenge.
00:14:46.940And speaking of elections, will you run in the next election, upcoming election?
00:14:52.740Graham I've been focused on preparing this budget and and presenting it I'm
00:14:57.900going to be making finalizing a decision and announcing that in the days ahead
00:15:01.440but why I'm you know now sorry okay hi Audrey never had the Canada I want to
00:15:11.680know what are the consequences of the Alberta government if it ever happens
00:15:15.940that it does not respect the fiscal framework that it will set out in
00:15:19.760legislation what's the consequence except just saying oops we broke our own law 100 days of jail
00:15:26.480time how's that you tell me just just um just kidding look the um for a government to contravene
00:15:35.600its its own legislation and that's regardless of which government legislation that was passed in
00:15:41.840the house would be um far more than embarrassing it would be a public spectacle and there would
00:15:49.040be a huge political cost to bear for breaking that legislation i believe that simply passing
00:15:54.960legislation around these fiscal dual rules provides real teeth in terms of the impetus
00:16:01.920for governments to follow them that's why crafting the fiscal rules and the details in the fiscal
00:16:08.640rules are so important we have a revenue structure here in the province and a resource-based economy
00:16:13.840where we have revenue volatility and these rules have to accommodate that kind of revenue structure
00:16:20.080and economy and i believe they do and my second question is do the massive investments well big
00:16:25.740investments we see in the alberta shares paved the way for an alberta provincial police right now
00:16:32.360we're focused on better enforcement and less crime that's the focus of our government so we're making
00:16:37.700very significant investments both in our public safety ministry as well as our justice ministry
00:16:43.100And we're going to be funding well over 200 additional enforcement officers across the province.
00:16:51.540That's significant. That's our focus right now.
00:16:53.780And, of course, the second part of that is to ensure that we have a justice system with the capacity to deal with, you know, every case that needs to be heard.
00:17:02.840Every perpetrator needs to have their day in court.
00:18:12.180That's what set the stage for this province to ultimately deliver balanced budgets into the future.
00:18:20.080So we immediately went to work on bringing fiscal responsibility back to the province,
00:18:24.700And it's that work that ultimately prepared us, led us to a very significant surplus last year, which allowed us to reduce our debt by over $13 billion, saving Albertans $260 million in 22-23, about $550 million in 23-24, and just under $600 million in 24-25 in debt service costs.
00:18:47.120That's almost $1.2 billion that can go to education, go to health care, or maybe go to the Heritage Savings Trust Fund.
00:18:54.700Again, you know, would it have been better that previous governments would have brought fiscal responsibility in the years earlier?
00:19:18.200And I have to give credit to Albertans, who dug in and worked hard and showed incredible resilience.
00:19:24.700Alberta entrepreneurs who saw opportunity that governments never could and stepped out and invested and grew this economy towards leading the nation right now.
00:24:14.860For my first question, for three years in a row, the Campus Alberta grant has received cuts,
00:24:19.920but with Budget 23, it seems like this trend is reversing.
00:24:23.560so if so why have you decided to reverse this trend now so in in budget 2022 we as as we as
00:24:32.580a province started to recognize that we have you know thousands of unfilled positions that require
00:24:39.600specific skills and competencies we started reinvesting again in a significant way in our
00:24:46.800in our great world-class post-secondary institutions that was really our workforce
00:24:51.840initiative. That was $600 million in total over three years. A portion of those funds were used
00:24:58.700to buy specific seats in specific occupations and disciplines where there was great demand.
00:25:04.820Just a really quick story. For the funds we set aside, we believed we could buy 7,000 seats,
00:25:10.480and these were seats in high-demand areas. And Minister Nicolaitis, to his credit,
00:25:14.860worked with our great post-secondary institutions, and ultimately for that same amount of money,
00:25:19.760they're providing 10,000 additional learning seats we're building on that as you point out
00:25:24.600in budget 2023 this is about again recognizing a great need a great need by for Alberta employers
00:25:33.580but also a really important great need for Albertans to have the skills they need to
00:25:39.580participate in this great Alberta advantage that's why we're investing but we're doing it in a
00:25:44.160different way. Much of our investment is targeted towards the specific seats in the occupations and
00:25:50.420professions that are in great demand. An incredibly valuable and worthwhile investment.
00:25:55.900Great. Thank you. And for my second question, you earlier said that Budget 23 is a continuation
00:26:02.480of Budget 2019. And in Budget 23, you are changing the interest rates for student loans from the
00:26:11.460prime plus one percent rate to the prime rate but in 2019 it was the opposite it was changed
00:26:17.780from already being at the prime rate to prime plus the one percent so what affected this change
00:26:25.180sure sure that that's a great question an astute question in terms of delivering a budget and a
00:26:31.400fiscal plan that's fiscally responsible that was the direction we set in 2019 budget 2023 aligns
00:26:38.880with that overall principle here's the good news we've spent three years doing
00:26:43.260the heavy lifting making difficult decisions all of us as Albertans and
00:26:47.220we've got our fiscal house in order we've achieved the fiscal anchor of
00:26:51.840aligning our per capita cost of delivering services with that of
00:26:54.780comparative provinces that's a key anchor and now that gives us the ability
00:26:59.220to move spending up prioritize and fund key priorities of Albertans and again
00:27:05.120right now we are really facing an affordability challenge that's been
00:27:08.760unprecedented in recent time and this is a way that we can provide real tangible
00:27:13.380relief for Alberta Alberta students thank you we're just gonna switch to the
00:27:17.880lines because we have quite a few people waiting right now we'll come back to the
00:27:20.700room in a little bit so operator can you put through the first caller thank you
00:27:25.480I'm a greenie Globe and Mail yeah good day minister I want to ask you about the
00:27:31.560new Alberta fund um can you expand on the reason why it is that your government
00:27:36.720shifting what could be significant capital expenses even if just one time to a separate
00:27:42.560fund i mean you could have billions in targeted spending here but you're choosing to omit that
00:27:46.740from budget so can you say why well again emma we're establishing the alberta fund to bring
00:27:53.660discipline to the use of our surpluses i i really believe it's critically important that
00:27:59.800Albertans get full value and have their surpluses managed, you know, in a publicly beneficial way.
00:28:07.620That's the purpose of the Alberta Fund.
00:28:09.320It's not, you know, it's to be more transparent with Albertans on the use of those funds.
00:28:13.560As I've mentioned, when a surplus is achieved, effectively that surplus can be used for debt repayment,
00:28:20.900additional deposit into the Heritage Savings Trust Fund,
00:28:23.560or for one-time non-reoccurring strategic priorities of the government.
00:28:28.880And again, the Alberta Fund is so that we can be more transparent and bring more fiscal responsibility on behalf of Albertans.
00:28:38.140The budget process is the place where we identify priorities of Albertans and needs within government-delivered services such as health care and education.
00:28:48.420And it's in that budget process that we look to make thoughtful, durable, and sustainable decisions, appropriate decisions around funding programming.
00:31:19.140Hi there. Thanks for taking my question here. Firstly, just wondering about the spending on major cities, Edmonton and Calgary. How much of an effort was made to make the spending, you know, relatively equal? It looks like they're both getting about $2 billion. What can you say about the division between the two major cities?
00:31:42.580look when ministries bring requests whether it's operating requests or capital requests to treasury
00:31:52.180board we at treasury board take a look at where's the where's the greatest need and where's the
00:31:58.540greatest return on investment what what are the biggest priorities for albertans regardless
00:32:02.960of geography that's the reality the fact is that calgary and edmonton are both great big
00:32:09.300world-class cities, and so there's going to be significant capital funds spent in both of those
00:32:15.320regions and both of those municipalities, but also right across Alberta. We, again,
00:32:22.100make decisions based on need and priority and defensibility, and that was the way the
00:32:27.880decisions were taken this year. Did you have a follow-up? Yeah, and then just when it comes to
00:32:34.580cities i'm sure you know they might be interested in accessing some of the funds uh in that alberta
00:32:40.420fund you know it's over a billion dollars is there is there a process for cities to sort of
00:32:46.100request access to that perhaps for you know a new arena or upgrades to uh to a stadium like
00:32:52.660commonwealth well in terms of municipalities directly access accessing the fund the answer
00:32:58.420is no there is no mechanism and that's by design again the alberta fund was established to bring
00:33:04.340discipline to the use of surplus. There's only three uses for those funds. The priority will be
00:33:10.360given to debt reduction, debt repayment, further investment in the Heritage Savings Trust Fund,
00:33:16.440and also an allowance for one-time spending that's non-reoccurring that aligns with
00:33:22.640strategic government priorities. Operator, can you put through the next caller?
00:33:27.360Janet French CBC. Hello there. Some of the structural costs that you've built into this
00:33:36.560budget rely on oil revenues to sustain. This seems to me to be completely opposite to the work that
00:33:42.860you've done to slim down the government during the last three years to rein in these structural
00:33:46.580costs. So what's your long-term plan to sustain these service levels without relying on resource
00:33:51.760revenues that's been an age-old question here in alberta job number one was bringing responsible
00:34:00.240fiscal management to the bottom half of the income statement to our expenditures and that's
00:34:04.080that's what we believed was uh the first job and we've worked hard at that over the last four years
00:34:09.280again doing it thoughtfully surgically but getting it done bringing our expenditures in line to where
00:34:14.780they're at a much more sustainable level going forward there to the point where we can make
00:34:19.320additional reinvestment. We can invest in Alberta's priorities. We can meet emerging needs because
00:34:24.720we've done the heavy fiscal lifting. Now, with respect to Alberta's revenue structure, it does
00:34:31.200remain volatile. We do depend at this point, certainly to a significant degree, on non-renewable
00:34:37.800resource revenues. And that's our reality right now. At the same time, we've focused on, again,
00:34:45.880creating a business environment that would attract investment and further
00:34:49.840diversify the economy that's also happening and that's in part reflected
00:34:54.220in the increasing corporate tax revenue and personal tax revenue that we see in
00:34:58.880the province so that is also part of the equation and and we're focused on that
00:35:03.040there's great value in a more diversified economy in Alberta not only
00:35:06.880so that Albertans can have you know find and pursue careers perhaps that they
00:35:11.800couldn't in alberta a few years ago but it also will create more stability for government revenues
00:35:17.640going forward did you have a follow-up i do but if we're looking at the numbers for 22 24 i mean
00:35:24.68018 billion dollars of the revenue you're expecting is coming from resource revenues and we're going
00:35:30.360to spend 68 billion what's to prevent you if oil prices crash from having to come back and then
00:35:36.520lay off all these healthcare workers these education workers that you're hiring
00:35:41.800Look, we went through a period of time where WTI oil prices hit the negatives in 2020, and the WCS prices stayed at $10 for far too long.
00:35:55.160We managed through that, and we managed through that while we continued to deliver government services.
00:36:00.960In fact, at the time, we were dealing with a pandemic, and we were having to support Albertans at a much higher level because of that.
00:36:08.640You know, I talk about the importance of paying down debt.
00:41:11.180Good afternoon, Minister. Thank you for taking my question.
00:41:15.880You've talked a lot about what's happened since 2019 when the UCP came into power,
00:41:21.120about the impacts on the economy and the investments that are made there.
00:41:26.480But going through the budget this year, there's not a lot that really stands out that's new
00:41:31.020in terms of that investment in the business sector.
00:41:33.040are you looking at this as more just kind of stability to further invigorate that sector or
00:41:41.720are there specific programs or specific things that are in this budget there that you're looking
00:41:46.040at to provide more of an injection into that business community because looking at it right
00:41:50.660now not a lot there that's uh that's a great question and i'd love to answer that because
00:41:58.440again back in 2019 we worked hard to create a very competitive business environment broadly that's
00:42:06.680why we brought down our corporate tax rate our general tax rate from 12 to 8 percent that's why
00:42:12.200we've been focused on red tape reduction regulatory modernization across sectors and we've done that
00:42:19.240because we believe it's important that broadly govern we should have a very competitive business
00:42:24.200environment because there'll be opportunities that government could never see and if we have a very
00:42:30.520broad-based competitive business environment entrepreneurs and investors can take advantage
00:42:36.200of opportunities regardless of what sector and that's what we're seeing today and that's uh
00:42:42.360that's been very very gratifying and it's resulted in a in a diversifying economy
00:42:47.560of significant proportion awesome Josh did you have a follow-up was there any
00:42:54.700real consideration into further lowering the corporate business or the corporate
00:42:59.380tax and small business tax to further address some inflationary pressures
00:43:04.540especially with a global slowdown coming you know what we consider our tax
00:43:10.080structure as we look at every budget right now we are very very competitive
00:43:15.320more than competitive from a Canadian standpoint, and very competitive with U.S. states.
00:43:22.140So we believe that we've calibrated our corporate tax rate at the right level.
00:43:28.160I should also mention that we have done some very specific, unique things in this budget
00:43:33.680with respect to our business environment.
00:43:36.020We have brought in the AGRA food processing and manufacturing tax credit,
00:43:41.560non-refundable corporate tax credit which again will further improve the competitiveness of our
00:43:48.280agri-food processing and manufacturing sector and our agriculture industry broadly. We've increased
00:43:54.640the film tax credit going forward which again will improve our competitiveness in that space
00:44:00.340and we've seen the film and television industry absolutely explode over the last few years.
00:44:06.180So two things. Budget 23 is about stability. And business investment craves stability. I know as a business owner and manager, stability and certainty are critical. That's what Budget 23 does. It brings stability. At the same time, we're making tweaks to even further improve the competitiveness of our business environment.
00:44:28.460awesome we'll take it back to the room thank you Charlotte it's Lisa Johnson
00:44:32.860from the Edmonton General High Minister I just want to go back to Emma's
00:44:35.940question about the Alberta fund you're saying that that the purpose of the fund
00:44:40.220is to have guardrails up to direct how the government spends a surplus or what
00:44:46.160it does with a surplus but this is discretionary one-time funding are you
00:44:51.960saying are you promising that you are going to detail any spending from the
00:44:56.740alberta fund if there is any before the election in the legislature because there are no details
00:45:02.660in this document in the documents today about what the government plans to spend potentially
00:45:07.6201.4 billion dollars on potentially a month before the writ is dropped any spending that's done
00:45:15.860between now and the election needs to be reflected in the appropriations bill and fiscal plan that
00:45:21.700i'm presenting in the legislature later today that's that's a reality for the upcoming budget
00:45:26.900year again there's a contingency amount 1.5 billion dollars in the budget that i'm presenting
00:45:32.820and that contingency uh fund is crucially vitally important to ensure that we can deal with
00:45:38.900disasters and emergencies that we're unable to budget or plan for but again any any plans and
00:45:45.780programs need to be reflected in this appropriations bill and and so no it
00:45:50.820again the Alberta fund really does provide guardrails and firstly at least
00:45:56.10050% of a surplus has to be used towards debt that's maturing in the year the
00:46:01.560surplus is attained that's that's number one it prioritizes debt repayment that's
00:46:05.460our fiscal rule but anything that ends up in the Alberta fund only you know
00:46:09.540debt repayment additional investment into the heritage trust fund or again
00:46:14.040one-time non-reoccurring investments that align with government's strategic
00:46:20.100priorities could could could fit as well but that needs to be reflected those
00:46:24.540plans need to be reflected in a budget
00:46:29.360follow-up sure yeah I mean but we won't see a fiscal update until after the
00:46:34.980election so we won't have those details but you're saying that it's going to be
00:46:40.180reflected in appropriations in detail just to clarify but I have a second
00:46:46.940question which is a bit of a niche question in a mandate letter to her
00:46:51.060Minister Premier Daniel Smith asked for a digital innovation tax credit for
00:46:56.260video game creators I'm wondering why that was abandoned in this budget I
00:47:00.400don't see it anywhere in the budget sure I mean you know what we constantly
00:47:04.840evaluate our competitiveness in every sector where we know we're naturally
00:47:09.820competitive. Certainly the tech sector is an area where we're naturally competitive. The numbers
00:47:15.300speak for themselves. And I should point out that in 2022, Alberta set another record in terms of
00:47:22.960venture capital investment at something like $729 million. And we did that. We set a new record at
00:47:29.700a time when provinces, other large provinces with large tech sectors, saw a decline in investment.
00:47:36.440So the point there is that Alberta is very competitive in the tech space.
00:47:41.880We have a growing tech sector in Alberta.
00:47:45.460We evaluate the competitiveness of every sector ahead of every budget,
00:47:49.620and a digital media tax credit is not included in this budget.
00:47:54.860We continue to work with the sector and the industry to understand what they're going to need to remain competitive.
00:48:02.220If I take a look broadly at the tech sector, what we're doing, again, broadly as a province,
00:48:08.000and that includes governments, includes our academic institutions, it includes our world-class tech sector,
00:48:13.460what we're doing broadly is working because we're winning with venture capital investment.
00:48:20.100Good afternoon. It's Safe Kaiser, Global News.
00:48:22.580Minister, a couple of questions back a couple of times you sent.
00:48:25.380This is not an election budget, but when we actually look at the budget,
00:48:28.920we see Calgary which is a battleground mentioned almost double the amount of times Edmonton is
00:48:35.660more money going to Calgary for more things. Why would that be the case if you're claiming this
00:48:40.740isn't an election budget? Again I can tell you as the President of Treasury Board our practice when
00:48:47.740we consider requests from ministries whether they be operating but especially capital. You can
00:48:53.040imagine every ministry lobbies hard for capital and of course we hear you know interventions from
00:48:58.420every MLA, rightfully so, as they're working to do their job. At Treasury Board, we have a
00:49:04.320comprehensive rating process that rates capital projects based on the need, based on the priority,
00:49:11.260based on the return of investment to Albertans, based on the readiness of that project.
00:49:16.660And it's through that checklist that ultimately informs our decisions at Treasury Board as to
00:49:23.000which projects we approve and move forward with. And so, you know, from time to time,
00:49:26.920some years it's going to be rural alberta other times it might be the north i can't wait for that
00:49:31.480day being from grand prairie other times it'll be the south or calgary or edmonton but again
00:49:36.920at as the president of treasury board we take a disciplined view and we want to ensure and we work
00:49:42.680to ensure that the highest priority the most defensible projects are the ones that are funded
00:49:48.600budget 23 is no exception right so what you're saying then is uh all of the requests you've
00:49:54.760received from edmonton i mean edmonton has just as big of a population and as many problems as
00:49:59.560calgary does you're seeing the requests you've seen don't give you a large enough return of
00:50:07.800investment that you think it's worthwhile investing into those problems in edmonton
00:50:13.080well you know the the projects are ranked based on need and priority they have a ranking based on
00:50:19.160safety they certainly have a ranking based on readiness all of those factors are considered
00:50:25.400when treasury board makes the final decisions around the capital plan and i can tell you this
00:50:30.360that again from time to time it'll be calgary edmonton or rural alberta that seems to you know
00:50:35.960get a disproportionate amount of that investment but that's the process we stick to and that's the
00:50:40.600process we undertook in budget 23. thanks eve hi minister morgan black also with global news
00:50:47.800on the topic of priorities i know affordable housing has been a big priority for edmonton
00:50:51.320for a number of years i didn't see that explicitly in the budget i don't know if
00:50:55.080that's included in msi funding but why was that not encompassed within this budget
00:51:01.080that's a great question we are funding affordable housing in budget 23 we're increasing funding
00:51:08.040for affordable housing and it will be a key part of budget 23. there's a great need
00:51:13.480out there both in our municipalities edmonton and calgary especially but more than that you know we
00:51:18.280can go to grand prairie fort mcmurray lethbridge medicine had other regions as well and we have a
00:51:24.840long-term strategy around affordable housing our goal is to add 25 000 additional doors over time
00:51:31.560we're sticking with that plan budget 23 ultimately delivers on the long-term plan to add more
00:51:38.360affordable housing options for albertans do you think oh all right um and my colleagues asked
00:51:43.560such great questions that i just thought this one um if you had any more surplus what would
00:51:50.120you have invested in that's not encompassed in this budget and why that's a great question you
00:51:55.480know if with additional surplus i believe that we should really be making debt repayment a priority
00:52:03.320in the future. Over the last few years, of course, with the shock of COVID, I talked about, it's kind
00:52:09.280of the triple black swan event, huge crash in energy prices, contraction in the global economy.
00:52:15.600Alberta's debt grew. That's the reality. We had to deliver for Albertans during that time.
00:52:21.040And there was a time in March, April of 2020, when there was great global uncertainty economically,
00:52:29.300And all sub-national governments in Canada, none of us could borrow, none of us could float a bond issue.
00:52:35.600And that lasted for quite a long period of time.
00:52:39.080And it was at that time I recognized the great need to create fiscal room
00:52:43.360so that a province like Alberta can handle an economic or fiscal shock in the future.
00:52:48.640That's why debt repayment, I believe, should be a great priority.
00:52:52.040Because as you pay down debt, you create fiscal room so that you can handle a shock in the future.
00:52:57.560The good news is this. We set a fiscal anchor of keeping our net debt to GDP ratio below 30 percent, keeping a relatively strong balance sheet even during those dark days. By the end of this year, that net debt to GDP ratio is 10 percent, the strongest balance sheet of any province in the country by far. That's good news for all of Albertans.
00:53:16.420Thank you. We have time for two more questions from the line. Then we have a hard stop at 145. So, operator, can you put through the next caller?
00:53:51.100In other words, how will you decide how to divvy that up between the three different
00:53:55.080buckets that you've already laid out today?
00:53:57.080I correct Chris that's a great question and we've allowed flexibility in the use of the Alberta fund again flexibility for debt repayment further investment in the heritage trust fund or perhaps one time strategic projects and you know my mind goes probably if it is going to be used for those purposes those are probably capital projects but I believe that we need to leave flexibility because for governments of the day they're going to need to
00:54:27.060evaluate the cost of capital, cost of borrowing. They're going to need to evaluate expected returns
00:54:33.260in the Heritage Savings Trust Fund. They're going to need to take a look at their overall debt
00:54:37.700levels. All of those features, I believe, should inform decisions around ultimate surplus allocation.
00:54:44.680Again, Chris, if you heard my answer to the previous question, you know my preference. My
00:54:50.280preference right now is debt repayment debt reduction in order to create fiscal
00:54:56.100room because fiscal room gives a province such as Alberta more optionality
00:55:02.520more flexibility should we hit another economic shock in the future and at the
00:55:06.520same time right now our cost of capital like every government around the world
00:55:11.760has been creeping up with interest rates even though our cost of capital
00:55:16.200relative to Ontario was going down because of our strong balance sheet the
00:55:20.220reality is is we're in a time of increasing interest rates and so right
00:55:24.280now debt repayment also materially lowers debt service costs which that
00:55:30.300funding can be available for programming or future investment in the heritage
00:55:34.380savings trustman Chris did you have a quick follow-up yeah this is a bit of a
00:55:40.620two-part question minister but is it your target to drive net debt down to
00:55:45.100zero and just going back to the earlier comments about the effectiveness of
00:55:49.920balanced budget bills, given the fact that we've already seen them in the past in this province in
00:55:53.860the 1990s and in the 2000s, and they were subsequently ignored by future governments,
00:55:59.300how successful or how effective are they?
00:56:03.620Chris, I believe a well-thought-out set of fiscal rules, a well-thought-out fiscal framework,
00:56:13.760like the framework that I'll be ultimately presenting in the House