June 28, 2018 12:08 pm
Updated: June 28, 2018 8:24 pm

Alberta economy has recovered two thirds of recession losses: government

WATCH ABOVE: The numbers are still at a place most people don't want, but they also show things are getting better in Alberta. The deficit is down compared to a year ago. Vinesh Pratap breaks down the results of the 2017-18 fiscal update.

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Alberta’s finance minister says the province’s economic picture is brightening with a lower-than-expected deficit last year thanks in part to higher resource revenues.

The government’s 2017-18 annual report shows Alberta ended the fiscal year with an $8-billion deficit. That’s $2.5 billion lower than what was expected in last year’s budget.

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READ MORE: Alberta slashes deficit projection by $1.4B in fiscal update

The NDP government says it’s on track to return to balanced books by 2023-24.

“While we’re happy to see our economy on the right track forward, we know the economic recovery has yet to reach every kitchen table in this province. And for us, an economic recovery that doesn’t reach every kitchen table is no recovery at all,” Joe Ceci said Thursday.

“That’s why we’re going to continue to make sure the Trans Mountain pipeline gets built. It’s why we’re going to keep working to create jobs and diversify our economy. It’s why we’re going to keep defending funding for our classrooms and hospitals. And it’s why we’re going to continue to make life more affordable for Alberta families.”

READ MORE: Trans Mountain pipeline project purchase ‘major step forward’: Rachel Notley

The report indicates the provincial economy has recovered about two-thirds of what was lost in a recession that began in 2014. It grew by 4.9 per cent last year and is expected to add 2.7 per cent this year.

There was $43.4 billion in borrowing for government capital and operational spending at year end and net debt stood at $19.3 billion as of March 31 – about $1 billion lower than forecast.

A rebound in the energy sector, driven by improved oil prices, spearheaded the recovery.

Non-renewable resource revenue was $5 billion – up $1.9 billion from the previous year and $1.2 billion higher than the budget estimate.

Conventional oil and gas drilling was up by 65 per cent. The manufacturing and forestry sectors also saw stronger performance.

Despite the welcome boost, the province is trying to be less reliant on the energy sector, Ceci said.

“Diversification is critical so that we don’t continue to ride the oil and gas energy roller-coaster, (so) that we see a more flat, predictable revenue source.”

READ MORE: Alberta report on debt shows bleak future for taxpayers

Personal and corporate income taxes came in lower than anticipated.

“They’re lagging for sure, but what I think we see in the economy is that the trend is in the right direction,” Ceci said.

Alberta’s population grew last year by nearly 58,000 residents, including more than 26,000 migrants.

The province says 90,000 jobs were added in 2017. The unemployment rate was seven per cent at the end of the year, down from a recessionary peak of nine per cent in November 2016.

READ MORE: Oil prices are high. So why is the Canadian dollar still so low?

Ceci said Alberta is emerging from a particularly severe recession.

“It’s been the toughest one in a couple of generations and it’s lasted longer than previous downturns.”

© 2018 The Canadian Press

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