Premier Smith vows to build Alberta Heritage Fund for 'future generations'

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Alberta Premier Danielle Smith addressed the province Wednesday evening, pledging continued investments into Alberta’s Heritage Savings Trust Fund for “future generations.”

During an eight-minute televised speech, Smith acknowledged the need for more fiscal restraint than previously anticipated, citing lower resource revenues and volatile oil and gas prices. 

“Thankfully, we had a good year, and we’ll collect enough resource revenues to cover that $16 billion, with a few billion leftover to pay towards our provincial debt and savings for the future,” said Smith.

“That said, we simply cannot continue to rely on $16 billion or more in resource revenues to balance our budget year in and out.”

The UCP outlined a plan last budget to limit annual spending increases to population growth and inflation while creating requirements for running a deficit and dictating how to set aside surplus cash.

Government legislation last spring requested 50% of surplus cash go to repaying debt maturing that year, with the remainder going to the Heritage Fund.

“Instead of spending all that non-renewable surplus cash on the wants of today, we will be fiscally disciplined — invest in the Heritage Fund annually, strategically pay down maturing debt. And slowly but surely, wean our province’s budget off the volatile roller coaster of resource revenues,” she added.

Tonight I am speaking directly to all Albertans on the challenges and opportunities that lie ahead for our province.
Together, we will seize this moment and continue on a path of prosperity. Albertans, our families, and our children deserve nothing less. pic.twitter.com/Bl2WPxXCTt

— Danielle Smith (@ABDanielleSmith) February 22, 2024

Smith suggested massive debt and cuts to health and education would be the price of not planning ahead for the future.

“In my view, our province has one last shot at getting this right. We still have several decades during this global energy transition, where nations will desperately need our oil and gas resources for their people, and we will provide it to them,” she said.

According to the province, their initial $2.2 billion investment into the Heritage Fund rose to $21.2 billion since last March 31. 

Established in 1976 to collect non-renewable revenues for “future generations,” Smith said her government will reinvest $3 billion of surplus and investment income into the Heritage Fund, thereby increasing its value to $25 billion.

The goal is to have between $250 billion to $400 billion in the fund by 2050, she said, in accordance with their efforts to shift towards a carbon neutral economy.

“There is no doubt in my mind we are capable of achieving these goals, but we need to start today and stick with it fervently year after year,” Smith told Albertans during the address.

“I ask for your support as our government commits itself to placing our province on this path to prosperity that will last long after our last barrel of oil has been produced.”