PROVINCE LOCKS IN INFLATION RELIEF PLAN

`Every little bit helps,' says chief economist as key interest rate again marches higher

Shortly before the UCP government introduced legislation to activate a $2.8-billion relief package for Alberta businesses and consumers stung by surging inflation, the Bank of Canada ratcheted up its key interest rate.

Again.

It's the seventh such increase since March.

Higher bills, falling consumer demand, escalating interest rates — it's a trifecta of trouble to wind up a tumultuous 2022.

Can the provincial government significantly shield Albertans from the deluge caused by surging shelter, food and energy bills? Or, like King Canute, is the tide simply too powerful to hold back?

“I don't think that (rate hike) in any way diminishes the significant inflation relief that is contained in this comprehensive package,” Matt Jones, Alberta's affordability and utilities minister, said Wednesday.

The assistance plan, first revealed by Premier Danielle Smith last month, comes with a $2.8-billion price tag over three years.

Some measures are targeted; others are more broadly based.

There will be $100 payments made to eligible seniors or families (for each dependent child) that have annual household incomes under $180,000, for six months starting in January.

The government is reindexing AISH, Income Supports and the

Alberta Seniors Benefit — they will go up by six per cent on New Year's Day — and it's indexing personal income taxes to inflation, retroactive to the start of this year.

The province will continue suspending its excise tax on gasoline and diesel until June, and extend the relief at the pumps after that period, based on benchmark U.S. oil prices.

It will temporarily cap electricity prices for consumers on the regulated rate option, at 13.5 cents per kilowatt-hour, for the first three months of next year, although prices above that mark will be deferred and recouped during lower-priced months.