Late yesterday afternoon, Finance Minister Nate Horner delivered the Alberta Government’s 2025-26 Budget. Here are the key highlights:
- Fiscal Balance: The budget projects a deficit of $5.2 billion for the fiscal year.
- Oil Prices: West Texas Intermediate (WTI) oil prices are expected to average US$68 per barrel in 2025-26, which is $6 per barrel lower than the previous year
- Economic Outlook: Economic growth is anticipated to slow from 3% in 2024 to 1.8% in 2025 and 1.7% in 2026. This forecast assumes Canada will face average tariffs of 10% on energy products and 15% on all other goods
- Tax Cut: A new 8% personal income tax bracket for income up to $60,000 will be introduced, saving Albertans up to $750 in 2025
- Revenue: Total revenue is forecasted to be $80.7 billion, an increase of $7.2 billion over the last budget forecast. This rise is primarily due to increased investment income, non-renewable resource revenue, and corporate and personal income tax revenue
- Expense: Total expenses are forecasted at $79.3 billion, an increase of $4.4 billion from Budget 2024. This includes a $2.2 billion increase in operating expenses
- Capital Plan: The capital plan is set at $8.1 billion for 2025/26, down by $200 million compared to the previous year. The plan aims to address current growth pressures, support future economic growth, and create additional opportunities for private sector participation
Navigating the sea of numbers in a budget can be overwhelming, leaving many Albertans struggling to make sense of the financial jargon and complex figures.
Imagine Alberta’s economy as a vast lake. Over the past three years, strong winds of population growth, private sector job creation, and economic expansion have stirred the waters, creating waves of prosperity. These waves, however, bring with them the need for more infrastructure and frontline staff, illustrating the cost of growth. Just as waves eventually recede, so too must we prepare for the ebb that follows the flow of economic success.
Finance Minister Nate Horner likened the current challenges to those faced by Albertans in the past. Federal policies, American trade challenges, and unstable commodity prices have long been part of Alberta’s landscape. He recalled Premier Lougheed’s 1973 query about the national interest in oil from Venezuela and Iran, highlighting the enduring nature of these issues.
To navigate these turbulent waters, the budget includes contingency funds to address labour negotiations and potential tariffs from the United States. This proactive approach aims to cushion the impact of external pressures.
The key takeaway from this budget is that economic growth, while beneficial, comes with its own set of challenges. Just as Alberta has weathered past storms, it must now brace for the uncertainties of commodity prices and tariffs. The lesson here is clear: preparation and resilience are essential to sustaining prosperity in the face of inevitable economic fluctuations.
Like the Alberta government, businesses leaders operating in Alberta must ask themselves: are they prepared for the turbulent times ahead?
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For more information and insights about what these developments mean for Alberta’s political landscape, please contact:
Rick Fraser -Senior Strategy Advisor
rick@prairieskystrategy.ca
403.701.7584
Whitney Issik – Senior Strategy Advisor
whitney@prairieskystrategy.ca
403.815.2582
Dan Nielsen – Senior Strategy Advisor
dan@prairieskystrategy.ca
780.235.7625
Colleen Potter – Senior Strategy Advisor
colleen@prairieskystrategy.ca
587.500.2336
Mat Steppan – Vice-President
mat@prairieskystrategy.ca
780.236.1543
Jeff Sterzuk – President
jeff@prairieskystrategy.ca
403.612.1724
Ben Thibault – Senior Strategy Advisor
ben@prairieskystrategy.ca
587.897.6261
Richard Truscott – Vice-President
richard@prairieskystrategy.ca
403.998.0494
To learn more about Prairie Sky Strategy, please visit our website.
