Another painful year in Alberta
NDP government still plans to balance books in six years
Alberta ended its most recent fiscal year with a $10.8 billion deficit and $33.3 billion in debt, but Finance Minister Joe Ceci said Thursday the economic outlook is improving and the NDP government still plans to balance its books in six years.
The province’s year-end financial statement said the Alberta economy shrank by more than seven per cent over 2015 and 2016 as the cratering in oil prices led to tens of thousands of layoffs and sharply cut government revenues.
Ceci said the Fort McMurray wildfire, which knocked major oilsands projects offline for weeks and forced more than 80,000 from their homes for a month or more, compounded an already dire situation.
“The oil price collapse together with the Wood Buffalo wildfire reverberated throughout our economy,” he said.
But matters started to improve around the middle of last year, with indicators like oil and gas drilling activity and manufacturing picking up.
“As we close off a very difficult year, the light on the Prairies is shining a little brighter,” Ceci said.
The Fort McMurray wildfire slowed the economy by 0.6 per cent and reduced royalty and tax revenues by about $300 million. The province spent $710 million on firefighting and support during the disaster, but that was offset by $495 million it received in federal assistance.
The deficit for the 2016-17 fiscal year was in line with the government’s most recent forecasts, but $263 million higher than anticipated in the budget. Total revenues were $1 billion more than expected at $42.4 billion.
Non-renewable resource revenues were $1.7 billion higher than the budget estimate thanks in part to higher-thanexpected commodity prices.
For instance, West Texas Intermediate crude prices, the key U.S. benchmark, averaged US$47.93 a barrel in 201617, nearly $6 higher than the budget estimate.