Budget 2025: What It Means for Northern Alberta Communities

The Bottom Line

Budget 2025 delivers targeted investments for northern Alberta communities. The $189 million Beaverlodge Health Centre replacement is the headline health project for the Peace Country. Highway infrastructure receives significant attention, including $101 million for Highway 63 twinning north of Fort McMurray and paving of Highway 686 to connect remote communities. The Rural Remote Northern Program gets a $12 million increase to recruit and retain physicians. While energy products face a lower 10% U.S. tariff compared to 15% on other goods, the economic uncertainty still weighs on the energy-dependent northern economy. The personal income tax cut saves you up to $750.

Top Measures That Affect You

1. Beaverlodge Health Centre Replacement: $189 Million

The three-year Capital Plan allocates $189 million for the Beaverlodge Health Centre Replacement, with $10 million in 2025-26, $170 million remaining over the following years. This is a transformative health infrastructure investment for the Peace Country region, replacing aging facilities and improving access to care for communities across the northwest.

2. Highway 63 Twinning North of Fort McMurray: $101 Million

Highway 63, the critical lifeline to Fort McMurray and the oil sands, receives $101 million over three years for continued twinning north of the city. This project improves safety and capacity on one of Alberta's busiest and most dangerous stretches of highway, directly benefiting workers, residents, and commercial traffic.

3. Highway 686: Connecting Northern Communities

Budget 2025 funds the paving of Highway 686 between Peerless Lake and Trout Lake, and commences design work to extend the highway from Fort McMurray to Peerless Lake. When complete, this highway will connect First Nation communities along the route and provide alternate access to Fort McMurray, shortening commute distances by 100 kilometres. This is a key roadway project to connect the province's northeast and northwest regions.

4. Keyano College Upgrades: $2 Million

Keyano College in Fort McMurray receives $2 million for lab and classroom upgrades to provide an enhanced learning environment for in-demand programs like nursing and paramedicine. These programs help address labour needs in Alberta's health care system, which is particularly acute in northern communities.

5. Northwestern Polytechnic: Grande Prairie

Northwestern Polytechnic in Grande Prairie receives funding for Power Engineering and Instrumentation Lab Development and Skilled Trades Expansion. These programs train the workers that northern industry needs. Highway 40 twinning south of Grande Prairie also receives capital funding, improving access to the city.

6. Rural Remote Northern Program: +$12 Million

The existing Rural Remote Northern Program receives a $12 million increase. Combined with $15 million for recruitment and retention of physicians in underserved areas and $12 million annually for physician support programs, this represents a focused effort to address the persistent doctor shortage in northern Alberta. The new primary care physician compensation model specifically incentivizes full-time rural and remote practice.

7. Personal Income Tax Cut

The new 8% bracket on your first $60,000 of income saves you up to $750 per year. In northern communities where many workers earn above $60,000 due to energy sector wages, every individual taxpayer benefits from this maximum savings amount.

Direct Financial Impact

Tax savings: Up to $750 per individual from the new 8% bracket. Alberta maintains no provincial sales tax, which is particularly beneficial in northern communities where the cost of living tends to be higher.

Energy sector outlook: The budget assumes a WTI oil price of US$68 per barrel and a WCS price of C$73.10 per barrel. Energy products face a 10% U.S. tariff, lower than the 15% on other goods. Oil production hit a record 4.3 million barrels per day in 2024. The energy sector is expected to fare better than other sectors under the tariff scenario, which is positive for energy-dependent northern communities.

Natural gas: The natural gas price assumption is $2.50 per GJ (AECO), up from $1.20 the prior year. Higher gas prices benefit communities in northwest Alberta where natural gas production is concentrated.

Property taxes: Education property tax rates increase to $2.72 per $1,000 for residential in 2025-26.

Northern residents deduction: The federal Northern Residents Deduction continues, valued at approximately $38.6 million province-wide in tax expenditures.

Service Changes

Health system restructuring: The four new provincial health agencies will affect how care is delivered in northern communities. Primary Care Alberta aims to provide access to primary care including after-hours and in rural and remote areas, using virtual and digital services. This is critical for communities where driving to a doctor can take hours.

Physician training: $44 million for the Physician Training Expansion Program through rural training centres provides increased access to medical education in rural areas. The goal is to train doctors who will stay and practice in communities like yours.

Indigenous health: $45 million over three years for Indigenous health initiatives prioritizing care in rural, remote, and First Nations, Metis, and Inuit communities. This is highly relevant for northern Alberta where many communities have significant Indigenous populations.

Wildfire preparedness: After devastating wildfire seasons, Forestry and Parks maintains operating expense of $362 million. While the major wildfire costs of 2024-25 do not recur in the base budget, the $4 billion contingency provides fiscal room for disaster response if needed.

Family Justice Strategy: The strategy is expanding to Grande Prairie and five base court locations surrounding Edmonton, improving access to family court services for northern residents.

What's Missing

No Fort McMurray-specific recovery fund: Despite the community's vulnerability to both wildfire and oil price volatility, there is no dedicated economic resilience fund for Fort McMurray.

No northern broadband expansion: The budget does not announce a specific northern internet connectivity or broadband infrastructure program despite the critical role of digital services for remote communities.

No northern housing strategy: While ASHC receives $767 million province-wide, there is no northern-specific affordable housing program addressing the unique challenges of building in northern climates at higher costs.

No energy transition support for northern workers: Despite long-term energy sector transformation, the budget does not include retraining or diversification programs specifically targeting northern energy workers.

No northern air ambulance enhancement: The budget does not specifically address air ambulance capacity for remote northern communities.

No Lac La Biche or Athabasca-specific projects: Several northern communities do not see named capital projects in the budget.

Key Dates

Date	Event
January 1, 2025	New 8% personal income tax bracket takes effect
February 27, 2025	Budget 2025 tabled
April 1, 2025	2025-26 fiscal year begins
After July 1, 2025	Adjusted payroll withholdings reflect tax cut on paycheques
2025-26	Beaverlodge Health Centre construction begins ($10M first year)
2025-26	Highway 686 paving and design work commences
2025-28	$101M Highway 63 twinning continues
2025-28	Keyano College upgrades proceed
Ongoing	Rural Remote Northern physician recruitment continues

Where to Get Help

• Alberta Health: For Rural Health Action Plan and northern health service updates. Call Health Link at 811.
• Alberta Transportation and Economic Corridors: For highway construction schedules. Call 310-0000 then 780-427-2731.
• Regional Municipality of Wood Buffalo: For Fort McMurray municipal information. Visit rmwb.ca.
• City of Grande Prairie: For municipal services and LGFF-funded projects. Visit cityofgp.com.
• Alberta Treasury Board and Finance: For tax and budget details. Visit alberta.ca/budget.
• Your MLA: Contact your northern Alberta MLA to advocate for regional priorities.