Alberta economy back deep in the red with $5.2-billion deficit budget

Alberta’s finances, tied for generations to the steep peaks and sharp valleys of oil and gas prices, are once again plunging deep into deficit, with no immediate relief in sight.

Finance Minister Nate Horner has introduced a budget that projects a $5.2-billion deficit this fiscal year on total spending of $79 billion.

That represents an $11-billion swing from the current budget, which is on track to register a surplus close to $6 billion.

It’s the first deficit under Premier Danielle Smith and the first since the COVID-19-era budget of 2020, and the province expects the deficits will remain through to 2027.

Horner says the red ink is driven mainly by oil, tariffs and a $1-billion tax cut that Smith’s government has been promising to bring in for two years.

Horner says oil prices are expected to fall compared with last year and says tariffs threatened by the United States could bring a $6-billion swing in the deficit depending on what is levied and how much.

More coming.