CALGARY -- Alberta will run a $6.8-billion deficit this year but the province's finance minister vows to post a surplus by 2023.
"I'm hopeful and I'm expectant and I'm confident that that the policies we’ve implemented and continue to implement will attract investment to this province and create long term opportunity for Albertans in the future," said Finance Minister Travis Toews
On Thursday, Toews shared details of the UCP's second budget since taking office.
While there were few surprises in the document, there were more details expanding on promises made in the last budget, released less than five months ago.
Oil optimism
The UCP government is optimistic about the projected price of oil, and therefore the province's fortunes which continue be tied to to it.
It anticipates oil selling for $58 a barrel this year, rising to $62 the following year and $63 by 2022-23.
It says by then, Alberta will be running a modest, $700-million surplus.
However, those numbers are based on the completion of least two of three current pipeline projects that haven’t been finished — the Trans Mountain Expansion, Keystone XL and Enbridge's Line 3.
The province also says it anticipates an additional $4 billion to be invested in Alberta this year, including $1.5 billion in the oil and gas sector, thanks in part to its controversial Job Creation Tax, which continues to reduce the corporate tax rate each year.
The province says that investment will lead to the production of an additional 170,000 barrels of oil per day.
However, it says even with improved economic climate, investment will be less than half as much as it was before the recession six years ago.
While Premier Jason Kenney recently hinted that the province may consider investing tax dollars in new oil and gas projects, there is no allotment for that in this budget, nor are there any concrete plans to pursue that option in the future.
The province also hopes to improve innovation and investment in Alberta’s agriculture sector, with the goal of creating 2,000 new jobs — however there is no detailed plan on how this will be achieved.
The government will also move to expediting visa applications for foreign graduates wishing to launch new companies in Alberta.
It's counting on Alberta’s unemployment rate dropping to 5.1 per cent over the next three years thanks in part to added jobs in those three sectors.
New taxes
While the province previously vowed to tax vaping products and Airbnb properties, it hadn’t explained how that would be rolled out until now.
A 20 per cent tax will soon be added to vaping products, bringing an estimated $8 million to the provincial coffers per year
A four per cent tourism levy will also be applied to Airbnb bookings as of this summer, bringing them in line with hotels — that’s expected to earn $3 million dollars this year and an additional $4 million a year after that.
Public pay cuts
The province also continues to take a hard line on public sector salaries.
"Alberta is spending $10.7 billion more per capita relative to other provinces," said Toews. "And the service we are getting isn't any better. Alberta is no longer the highest cost jurisdiction to live in anymore either ... we can no longer afford to be an outlier in the way we spend money."
It says $26.7 billion is currently devoted to government pay cheques every year — well over half of all government spending.
The UCP plan to reduce that overall figure over the next three years but this comes just weeks before it enters what are expected to be contentious contract talks with several public sector unions.
School daze
Perhaps no sector felt the impact of the UCP's fall budget more than that of post-secondary education.
Colleges and universities saw drastic cuts to funding, leading to the elimination of some programs and reductions in staff.
While the province isn’t cutting post-secondary institutions (PSIs) any deeper in this budget, it’s also not planning on restoring any funding and advanced education’s financial allotment will slowly recede.
While PSIs received nearly $5.4 billion a year ago, they’ll be getting just over $4.9 billion by 2023.
Kindergarten to Grade 12 schools won't see any more money either, despite projected increases in enrolment.
The province says schools will have $100 million more to work with, however that money needs to be generated by the schools themselves — either through facility rental, fundraising or savings from previous government allocation.
Forward thinking
Whether it's more jobs, more money or more people moving to the province, the 2020-21 budget may also be viewed as an optimistic road map for Alberta’s future.
The UCP says they want tourists to spend $20 billion a year in Alberta — twice as much as they spend right now.
It also hopes for more innovation in the technology sector as Alberta continues to search for ways to move away from oil and gas as the dominant economic driver.
The government wants to move forward with plans to increase the number of surgeries performed in Alberta and reducing how one it takes to get one.
It also hopes 80,000 additional surgeries are performed over the next three years and that nobody waits more than four months to get one.