Alberta Budget 2025 vs 2024: Spending Comparison
Side-by-side comparison of Alberta Budget 2025 and Budget 2024 spending, revenue, and assumptions. Total expense rises 8.4% as the province swings to a $5.2B deficit.
Overview: A Dramatic Fiscal Reversal
Budget 2025 represents the most significant year-over-year fiscal shift in Alberta since the pandemic. Comparing the Budget 2024 estimate for 2024-25 against the Budget 2025 estimate for 2025-26 reveals a fundamentally altered fiscal landscape.
| Metric | Budget 2024 (2024-25 Est.) | Budget 2025 (2025-26 Est.) | Change |
|---|---|---|---|
| Total Revenue | $73,537M | $74,138M | +$601M (+0.8%) |
| Total Expense | $73,182M | $79,349M | +$6,167M (+8.4%) |
| Surplus/(Deficit) | $355M | ($5,211M) | -$5,566M |
Revenue is essentially flat on a budget-to-budget basis, but the composition has shifted dramatically. Expense growth of 8.4 per cent — driven largely by the doubled contingency — pushes the province into deficit.
Revenue Comparison
| Category | Budget 2024 | Budget 2025 | Change | % Change |
|---|---|---|---|---|
| Personal Income Tax | $15,604M | $15,510M | -$94M | -0.6% |
| Corporate Income Tax | $7,028M | $6,764M | -$264M | -3.8% |
| Other Taxes | $6,013M | $6,563M | +$550M | +9.1% |
| Bitumen Royalties | $12,538M | $12,830M | +$292M | +2.3% |
| Other Resource Revenue | $4,777M | $4,237M | -$540M | -11.3% |
| Federal Transfers | $12,640M | $13,287M | +$647M | +5.1% |
| Investment Income | $3,267M | $2,882M | -$385M | -11.8% |
| Gov't Business Enterprises | $2,123M | $2,016M | -$107M | -5.0% |
| Premiums, Fees, Licences | $5,383M | $5,636M | +$253M | +4.7% |
| Other Revenue | $4,164M | $4,412M | +$248M | +6.0% |
| Total Revenue | $73,537M | $74,138M | +$601M | +0.8% |
The budget-to-budget revenue comparison masks the magnitude of the shift. The 2024-25 third quarter forecast was $80,692 million — significantly above the original Budget 2024 projection. Budget 2025 revenue of $74,138 million represents a $6,554 million drop from that updated forecast.
Key drivers: the new 8% income tax bracket reduces PIT by approximately $1.2 billion; investment income is down sharply; and other resource revenue (including natural gas and land lease sales) has declined.
Expenditure Comparison
| Category | Budget 2024 | Budget 2025 | Change | % Change |
|---|---|---|---|---|
| Operating Expense | $60,124M | $64,311M | +$4,187M | +7.0% |
| Capital Grants | $3,469M | $3,452M | -$17M | -0.5% |
| Amortization | $4,564M | $4,993M | +$429M | +9.4% |
| Debt Servicing | $3,389M | $2,968M | -$421M | -12.4% |
| Pension Provisions | ($364M) | ($375M) | -$11M | — |
| Contingency | $2,000M | $4,000M | +$2,000M | +100% |
| Total Expense | $73,182M | $79,349M | +$6,167M | +8.4% |
The contingency doubling alone accounts for $2 billion of the $6.2 billion increase. Operating expense growth of 7.0 per cent reflects population-driven demands in health, education, and social services.
Debt servicing declines $421 million, benefiting from prior debt repayment and lower rates — but this reverses in 2026-27.
Economic Assumption Changes
| Variable | Budget 2024 | Budget 2025 | Change |
|---|---|---|---|
| WTI Oil Price | US$74.80/bbl | US$68.00/bbl | -US$6.80 |
| Light-Heavy Differential | US$16.30/bbl | US$17.10/bbl | +US$0.80 |
| Exchange Rate | 75.9 US¢/CAD | 69.6 US¢/CAD | -6.3¢ |
| Real GDP Growth | 2.9% | 1.8% | -1.1 pp |
| Population Growth | 2.1% | 2.5% | +0.4 pp |
| CPI Inflation | 2.3% | 2.6% | +0.3 pp |
| Unemployment Rate | 6.6% | 7.4% | +0.8 pp |
| Natural Gas Price | $2.55/GJ | $2.50/GJ | -$0.05 |
The most consequential changes: WTI drops $6.80/bbl, the exchange rate weakens 6.3 cents, and real GDP growth slows by more than a full percentage point. Budget 2025 also introduces a tariff assumption (15% on goods, 10% on energy) that was entirely absent from Budget 2024.
New Measures in Budget 2025
| Measure | Value | Description |
|---|---|---|
| 8% income tax bracket | $1.2B/yr cost | Implemented two years ahead of Budget 2024 schedule |
| Border Interdiction Patrol | Part of +$44M PSES | New Alberta Sheriffs team for U.S. border |
| Compassionate Intervention Act | Included in MHA expense | Mandated addiction treatment framework |
| Acute Care Alberta | $4,639M operating | New provincial health agency |
| Primary Care Alberta | $322M budget | New primary care agency |
| Assisted Living Alberta | $3.8B operating | Continuing care agency under SCSS |
| Alberta Disability Assistance Program | In planning | Launching 2026, replacing portions of AISH |
| Fiscal framework amendments | — | Adjusting surplus cash allocation rules |
Absent from Budget 2025
The following were present or expected based on Budget 2024 but are absent or reduced:
- Surplus cash allocation: No surplus cash forecast for 2025-26 through 2027-28
- Debt repayment: No further debt repayment planned after 2024-25
- Balanced budget: Three deficit years projected vs. Budget 2024's slim surplus
Narrative Shift
Budget 2024's subtitle was focused on responsible growth in a booming province. Budget 2025's framing is "Meeting the Challenge" — reflecting the shift from managing prosperity to managing adversity. The language around tariffs, uncertainty, and resilience is new. The emphasis on the fiscal framework's deficit allowance provisions is prominent in a way it has not been since the pandemic era.
Net Assessment
The fiscal trajectory is worsening. Revenue is essentially flat budget-to-budget while expense has grown 8.4 per cent. The province moves from the narrowest of surpluses to substantial deficits, with taxpayer-supported debt projected to grow from $87.8 billion (Budget 2024 forecast) to $98.4 billion by 2027-28. The operating expense discipline remains intact, but the revenue base has eroded — and the deliberate choice to cut income taxes by $1.2 billion annually accelerates that erosion.
Evidence basis: Budget 2024 figures from Fiscal Plan 2024-27 published February 29, 2024. Budget 2025 figures from Fiscal Plan 2025-28 published February 27, 2025. All amounts in millions of Canadian dollars unless otherwise noted.