UCP expected to ramp up spending on healthcare, education in Budget 2023

The United Conservative Party said its focus with Tuesday's budget is healthcare and education, with pundits expecting the party to loosen its purse strings in the upcoming fiscal year.

Alberta's Finance Minister Travis Toews released a pre-budget video Thursday of him polishing his cowboy boots as a fiscal responsibility and flexibility metaphor.

"It's important to leave enough fiscal room and flexibility in the budget so Albertans can be prepared for an emergency or a commodity price shock. I want to ensure that Alberta remains affordable, with great opportunities and good-paying jobs, the best healthcare providers in the world, and a strong voice in Canada," he said.

As of last November's fiscal update, Alberta had a $12.3 billion surplus for 2022/23, mainly owing to a substantial rebound in oil prices.

West Texas Intermediate (WTI) crude cost averaged well above the government's original budget estimate of US$70 per barrel. Last June, it soared to US$120 per barrel and sat shy of US$76 per barrel as of Monday.

The UCP lowered its surplus to fund tax breaks and social program enhancements from a previous forecast of $13.2 billion. In November, the province announced $2.8 billion in payments, rebates and tax cuts designed to provide inflation relief.

Opposition New Democrats said Monday they await the anticipated large surplus but remain skeptical of where the government would allocate funding. 

Finance critic Shannon Phillips told reporters she expects the UCP to use the surplus to remediate its "generational damage" to service cuts.

"Who knows what kind of spaghetti they'll throw at the wall this time?" she said sarcastically.

On healthcare, Alberta's Health Minister Jason Copping pledged $243 million to boost its primary healthcare over three years and a further $158 million in new spending to recruit frontline staff.

Premier Danielle Smith also pledged to increase mental health and addiction funding by three times that provided in 2019 to $275 million.

Last week, the University of Alberta and the University of Calgary received $9.6 million to accelerate innovation in healthcare.

On education, the province provided $125 million for Edmonton's MacEwan University to support creating a business school with its own building.

The UCP also committed $27.3 million to help Ukrainian refugees access settlement, language, housing and financial support in the upcoming fiscal year.

"Never have so many budget money announcements been made before [the] budget day," said Calgary Herald columnist Don Braid.

"This has been going on for weeks. It's all about the May 29 election, an effort to suck up all the attention and deny it to the NDP."

He added: "It's not exactly a resurrection, but the United Conservative Party's revival comes close. The party that was near death a year ago could now win a second Alberta election in May."

However, Smith cautioned her government would not provide an update on a potential provincial pension plan or police force in the budget announcement. Health spending accounts also appear missing from Tuesday's announcement.

Toews addressed consultations on a potential provincial police force and said last week to expect "a deep commitment to public safety and better enforcement."

Several years ago, presenters at the province's Fair Deal Panel felt the RCMP became "too bureaucratic to respond to local needs," and their resources spread too thin. They claimed their habit of moving officers around the province hurt police effectiveness and that the force "was unable or unwilling to confront activists who terrorize farmers."

Concerns also remain over the policing group's heavy-handed enforcement of gun laws and controversies surrounding Bill C-21.

A 2021 PricewaterhouseCoopers report commissioned by the province said the RCMP costs Alberta about $500 million annually. The report found that those costs would rise to $735 million annually for a provincial service, on top of $366 million in startup costs.

Public Safety spokesperson Dylan Topal said earlier this month the UCP initiated efforts to transition Alberta "on its terms" should the feds end RCMP contract policing or reduce its $170 million in funding to the province through cost-sharing agreements.

MacEwan University political scientist Chaldeans Mensah said Tuesday's announcement would undoubtedly reflect the party's election platform.

"Overall, I'm looking at a budget that threads the needle between fiscal conservatism and trying to use it as a stepping stone for the next election by dealing with vulnerable spots," said Mensah, adding he expects a spending spree.

He expects questions to centre around how the new spending will stand up should the province's economic fortunes reverse again.

"How sustainable are the funding announcements going to be if the government faces a challenge?"

Owing to consecutive surpluses, Alberta's provincial debt as a share of its economy is expected to decrease nearly by half, from 20.1% in 2020/21 to 10.3% in 2022/23. On a per-person basis, its provincial debt burden now stands at $10,131 — the lowest among the provinces. 

From 2020/21 to 2022/23, Alberta's provincial debt (inflation-adjusted) is projected to decrease from $65.7 billion to $46.0 billion — a 30.0% drop. It went from being the only province with more assets than debt in 2007/08 to possessing the fastest-growing provincial debt burden nationwide last decade. 

Budget 2023 will be revealed at 3:15 p.m., exactly 90 days before the provincial election scheduled for May 29.

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