Government & Policy
Provincial Budget, 2004/05, Announced
The 2004/05 Provincial Budget (“On Route On Course – Heading Toward Alberta’s Second Century”) was released on Wednesday, March 24th. Spending is up, which is no surprise with all signs pointing to an election next year, and both health and education receive substantial increases.
For 2004/05, Alberta Learning’s program spending will increase by $284 million, or 5.7%, to $5.3 billion, in part to help address government-supported recommendations from Alberta’s Commission on Learning, and to improve post-secondary access. According to the Government’s Fiscal Plan 2004-07, the Learning Ministry’s program spending will exceed $5.7 billion by 2006/07, for a three-year increase of $734 million, or 14.7 %. (The total is somewhat higher with the inclusion of property tax support to school boards which opt out of the Alberta School Foundation Fund.) This sounds impressive, but a note of caution is advisable.
For 2004/05, ongoing operating funding to post-secondary institutions will increase by $85 million, or 7.5%, to $1.22 billion (and is projected to reach nearly $1.3 billion by 2006/07). These numbers exclude $40 million in one-time allocations for performance, and for operations and maintenance provided in 2003/04. The Ministry’s 2004/05 Estimates set total grants to technical institutes at $157.6 million (gross); and to public colleges at $297.7 million (gross) – up from $152.1 million and $285.8 million, respectively, in last year’s Budget.
All public universities, colleges and technical institutes will receive a base operating grant increase of 4.0% in 2004/05. This will go some way to easing pressure on the system, though it is unlikely to forestall cutbacks at the University of Alberta and other post-secondary institutions facing a substantial shortfall this year.
In addition, increased funding is being provided through the Access Fund to create up to 2,000 new spaces over the next four years for priority programs (as announced earlier), and “to enhance apprenticeship programs.” The 2004/05 Estimates show a total of $146.2 million in the Access Fund envelope, up from $113 million in last year’s Budget. (There is no new money in the Estimates for the Performance Envelope.)
Reference is made to the implementation of the new Post-Secondary Learning Act as the means to increase access to degree-granting programs, but there is no specific allocation for this purpose in the 2004/05 Budget.
Funding for scholarships, bursaries and grants to students will increase by $6.2 million, or 10.9%, to $63 million in 2004/05.
For 2004/05, $4 million has been budgeted for the Alberta Centennial Education Savings Plan, which is set to begin on January 1, 2005. Starting in 2005/06, the program will cost $20 million a year.
For infrastructure, the Capital Plan 2004/07 earmarks a total of $416 million for post-secondary facilities over the next three years (approximately $312 million for completion of current capital projects, with $104 million available for new projects). For 2004/05, the estimates include $128 million for new facilities and $100 million for expansion, upgrading and maintenance of existing facilities. These projects will be supported through the Ministries of Infrastructure and Revenue.
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N.B. It is important to recognize the assumptions underlying the Alberta Government’s 2004/05 Budget and its Fiscal Plan 2004/07:
According to the Budget materials, Alberta’s (real) GDP is expected to grow by 3.6% in 2004, and is expected to average 3.1% per annum over the medium term.
CPI inflation in Alberta, which averaged 4.4% for 2003 as a whole, but declined steadily in the second half of the year, is expected to fall below 2% in 2004, and to remain in the 2.0% range through 2007.
More information on the Budget is available online at http://www.gov.ab.ca/budget2004/.