Edelman Canada shares highlights from Alberta Finance Minister Joe Ceci’s 2017 Budget. To learn more about Edelman Canada, please visit www.edelman.ca.

1. Edelman Calgary | #220 903 – 8th Avenue SW | Calgary, AB T2P 0P7 | 403 817 0620
The Alberta economy has been hit hard in recent years
with a deep recession, slow recovery, and low oil prices.
Albertans are becoming increasingly unhappy with
the state of their province, and the NDP government is
consistently running third in public polling.
Against this backdrop, the Alberta government has tabled
a budget that includes a $10.3 billion deficit, and a debt
that will grow to $71.1 billion by 2019-20. For Albertans,
that means $51.1 billion in new provincial debt has been
added since 2015.
Getting public spending under control in the near-term
won’t be easy, as public sector compensation accounts
for roughly 50% of the budget, and many of the contracts
that have forced those costs were negotiated years ago
with built-in, annual raises. Reigning in the public purse
will require staunch leadership and courage in the face of
steep political consequences moving forward.
A recent survey showed that Premier Notley’s personal
approval rating has dropped to just 35%, with 56.7%
of Albertans disapproving of her leadership. For a
province that has grown accustomed to being a model of
economic success and political stewardship, this is largely
unchartered waters for many, posing new challenges and
novel opportunities.
Bob Richardson
Executive Vice-President & National Practice Lead
416.849.1913 | bob.richardson@edelman.com
2017 ALBERTA BUDGET UPDATE
OUR PERSPECTIVE
HIGHLIGHTS
• Budget 2017 projects a modest economic recovery
since the oil price crash two years ago, fueled by growth
in exports, increased drilling activity, oil production, and
manufacturing. It also projects a $10.3 billion deficit
(down from a $10.8 billion forecast in 2016-17).
• Though Budget 2017 estimates Alberta’s economy
will grow by 2.6% this fiscal year, the province is now
projected to be $71.1 billion in debt by 2019-20.
• A return to a balanced budget is not expected in
Alberta until 2023.
• Forecasting oil priced at $55 per barrel and bitumen
production ramping up to 2.9 million barrels per day,
Budget 2017 lays out revenue projections at $45
billion in 2017-18.
• Budget 2017 includes $9.2 billion in health facilities,
roads, maintenance, environmental initiatives and
other projects under its massive construction, repair
and upgrading plan, borrowing $6 billion for capital
projects, and a further $6.4 billion to pay the day-to-
day bills. This borrowing will bring Alberta’s debt
to $45 billion.
• Increased infrastructure spending is expected
to boost activity and improve productivity, and
Budget 2017 earmarks $29.5 billion over four years
for infrastructure projects including: $7.6 billion
in municipal infrastructure support, $3.1 billion for
roads and bridges, and funding for two major road
infrastructure projects in Calgary (Airport Trail) and
Edmonton (50th Street).
• Budget 2017 also includes $14.5 million to hire
35 crown prosecutors and an additional 30 court
support staff (in addition to the 15 crown prosecutors
currently being recruited) to help address rising
court pressures.
• To better control spending costs, Budget 2017
offers savings of $200 million in 2017-18 and 2018-
19, and $100 million in 2019-20 by reducing salaries
of the highest paid CEOs of 23 provincial agencies,
amalgamating or cutting 26 agencies, boards and
commissions, and freezing the salaries of political staff
and management staff in the Alberta Public Service
and agency boards and commissions.
• Budget 2017 estimates more than 600,000 barrels
per day of new production will help lift real oil exports
by 16% over the next two years. In addition, the increase
in conventional oil and gas drilling in Budget 2017 is
expected to lift overall energy investment by 4.9% in 2017.
• The government will also seek intervener status on any
legal challenges to the Trans Mountain Pipeline and
will continue to work with the federal government and
provinces on the Energy East proposal this year.
• Budget 2017 provides a detailed look at how carbon tax
revenue will be used, and of the estimated $9.6 billion the
levy is expected to raise over five years, $6.2 billion will
be used to diversify the energy industry. The remaining
$3.4 billion will go to supporting households and
businesses in adjusting to the new levy through rebate
programs and small business tax breaks.
• The provincial carbon levy was outlined at length in
Budget 2017, and is estimated to raise $1 billion in 2017-18.
• The impacts of the carbon levy will vary by family,
depending on a household’s energy use and driving
patterns, and an estimated six of ten Alberta households
will receive a rebate that covers the average cost of the
carbon levy: $200 for an adult, $100 for a spouse and
$30 for each child under 18 (up to four children). The
indirect costs of the carbon levy are estimated to range
between: $50 to $70 per household in 2017.
• To help businesses adjust to the carbon levy, Alberta’s
small business corporate income tax rate was reduced by
one third, from 3% to 2% effective Jan 1, 2017, and Budget
2017 estimated the reduction will save small business
owners $185 million in 2017-18.
ENERGY AND ECONOMY
Hon. James Moore
Special Advisor, Public Affairs, Edelman Canada
604.648.3401 | james.moore@edelman.com
John Larsen
General Manager, Edelman Calgary
403.817.0626 | john.larsen@edelman.com

2. Edelman Calgary | #220 903 – 8th Avenue SW | Calgary, AB T2P 0P7 | 403 817 0620
2017 ALBERTA BUDGET UPDATE
EDUCATION
HEALTH
Budget 2017 was true to a pre-budget promise to keep post-
secondary funding predictable and sustainable, increasing the
base operating grants by 2%.
Surpassing $6 billion for 2017, Alberta’s advanced education
expense is the third largest portfolio behind health ($21.4
billion) and education ($8.2 billion).
The Alberta Education Ministry spending will jump to $8.2 billion
in 2017-18 to accommodate an expected 12,000 more Alberta
students, and significant ministry funding will be put towards
24 new and modernized schools across the province.
Budget 2017 also includes a 25% reduction of public school fees
for K-Grade 12, (an equivalent savings for families of $54 million)
that will take effect in the 2017/18 school year, as well as an
extension of the tuition freeze in post-secondary institutions for
the third year in a row.
Of the $29.5 billion over four years earmarked for key provincial
infrastructure projects in Budget 2017, $4.5 billion will go towards
health care, including a new hospital in Edmonton and long-term care
senior’s facility in Calgary.
Government spending on health care will increase to $21.4 billion in
2017-18, representing a 5% increase from last year’s health budget.
With an added emphasis on community and home care (adding over
1,000 new continuing care beds for communities across Alberta), Budget
2017 includes $31 million in Community and Social Services and Health
to support unemployed Albertans during the economic downturn.
By signing a new agreement with Alberta’s doctors, Budget 2017 also
forecasts a savings of $500 million over two years.
CHALLENGES
On April 1st, the Alberta government will be begin entering into contract negotiations with many of their supporters at a
time when Alberta taxpayers are already tired of deficits, mounting debt and a uncompetitive economy.
The government will have to negotiate new contracts with 19,000 paramedics employed by the Alberta Health Services,
28,000 nurses, and 24,000 support-service employees, with others on the horizon thereafter.
Meanwhile, former federal Conservative Party colleagues Jason Kenney, the incoming leader of the Alberta PC Party, and
Brian Jean, leader of the Wildrose Official Opposition, are openly flirting with a centre-right merger ahead of the next
election to defeat the incumbent NDP government.
Between growing public angst over the state of the economy, impending labour negotiations that risk NDP core support,
and a possible united centre-right alternative, Premier Notley’s NDP government has massive challenges on the horizon
as they begin planning their path toward the next election, expected in May, 2019.
STAKEHOLDER REACTIONS
“As our economy recovers, we will continue to bring the deficit down to balance, and we will do so without
sacrificing the supports and services families need.”
- AB NDP – Treasury Board President and Finance Minister, Joe Ceci
“Albertans will be paying for this budget for years to come.”
- Wildrose Party – Opposition Leader, Brian Jean
“They haven’t even slowed down, and now they are taking Alberta over the fiscal cliff.”
- Progressive Conservative Party – Interim Leader, Ric McIver
“What businesses mainly want is for government to not make it any harder to survive in these
challenging times and this budget shows us there is clearly no plan to make it easier.”
- Calgary Chamber of Commerce – CEO, Adam Legge