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Alberta keeping federal finances from boiling over: report

Last Updated May 16, 2019 at 7:43 am MDT

Finance Minister Bill Morneau speaks at the National Press Theatre during a press conference in Ottawa on Tuesday, May 29, 2018. THE CANADIAN PRESS/Sean Kilpatrick

CALGARY (660 NEWS) – Canada might be facing a nearly $20 billion deficit this year, but Alberta might be preventing the country from going even further in debt.

That’s one of the findings of a new report from policy think tank The Fraser Institute, saying that the province largely contributed to the health of the Canadian economy from 2004 to 2014.

According to the study, the federal government’s deficit in 2017/2018 would have ballooned if not for Alberta’s revenue contributions.

Policy Analyst Steve Lafleur explains just how much bigger the deficit would have been.

“If you subtract out the 20-plus billion dollars that Alberta contributed in excess of what it received, that would have been 39 billion dollars. That’s a big deal in terms of federal finances, especially if we ever hope to return to balanced budgets.”


Despite enduring a recession, the Fraser Institute study found that Alberta sent Ottawa $92 billion more than what it received in federal transfer payments and services between 2014 to 2017.

Alberta’s net contribution peaked in 2014 at $27.6 billion but due to economic weakness in the province, that contribution shrunk somewhat but was still $20.5 billion in 2017.

“It’s still a large transfer when you’re talking about $20 billion,” says Lafleur. “despite the fact that we’ve seen our economic output fall, we’ve seen persistently high unemployment. Even despite these challenges, we’re still transferring a significant amount to the federal government.”

Lafleur goes on to say that the narrative about Alberta’s relationship with the rest of Canada needs to change.

“I think what’s crucial is that often resource issues are framed as Alberta issues which really isn’t fair because the entire country benefits from Alberta’s contribution to federal finances.

Despite the contributions, the study found that Alberta was one of four provinces that did not receive equalization payments. B.C., Newfoundland and Saskatchewan were the other provinces.

The province receiving the highest payments is Quebec, which collected $11.7 million this past fiscal year.