The Alberta government’s Budget 2017 expressed optimism about the “green shoots” of recovery as the province emerges from recession and is aligned with Calgary Economic Development’s focus on innovation driving prosperity and economic diversification.
Finance Minister Joe Ceci tabled the $54.9-billion budget in the legislature Thursday and acknowledged: “We are not out of the woods yet. Far from it. But there are hopeful economic signs, what I refer to as ‘green shoots’.”
Ceci expressed cautious optimism about a stronger economy but the government is limited in the levers it can pull to stimulate growth with a $10.3 billion budget deficit.
There was $166 million allocated to economic development, trade and investment attraction, science and innovation, as well as for jobs, investment and diversification. Almost $1 billion from carbon levy revenues will go to initiatives under the Climate Leadership Plan over the next three years which include innovation and technology.
There was a modest but important change in funding to diversify the creative industries sector.
The Alberta Media Fund that supports film and TV production was increased to $29 million a year from the previous $25 million annual cap. An $11 million “top up” to the fund in 2015 and 2016 to clear a backlog of productions came to end.
However, funding was bolstered with $5 million to support post-production and interactive video to bring the Alberta Media Fund to $34 million.
“We agree with the need to diversify within creative industries and we’re doing it as an organization too so we are pleased the budget supports that,” said Mary Moran, President and CEO of Calgary Economic Development. “We hoped for additional support to attract more major and big budget films but we are working closely with the government to see that the industry here reaches its full potential.”
Film and TV production is a $175-million-a year industry in southern Alberta. There is an opportunity to grow to $500 million annually – and create more than 5,000 jobs – by 2020 with appropriate government support.
A foundation is in place for the sector to grow. The Calgary Film Centre opened last May and provides a base for the industry in southern Alberta that has won more awards at the Oscars, Emmys and Golden Globes over the last decade than any jurisdiction in Canada.
Purposeful economic diversification into agribusiness, clean energy, renewables, logistics, finance and creative industries – and their related technologies – is a cornerstone of Building on our Energy, the Economic Strategy for Calgary.
There was no change to the corporate tax rate in the 2017-18 budget which included $9.2 billion in capital spending on infrastructure projects such as flood mitigation and highways as well as schools and hospitals; including the Calgary Cancer Centre.
The budget forecasts economic growth of 2.6 per cent during the fiscal year. Its revenue projections are based on benchmark West Texas Intermediate crude averaging US$55 per barrel with a US$16 discount on heavy oil and Alberta gas averaging $2.90 a gigajoule.
The budget cites a stronger energy sector as a key to recovery. Ceci said the government is confident the regulatory approval in 2016 of expansions for two oil pipelines – Kinder Morgan’s Trans Mountain to the West Coast and Enbridge’s Line 3 to the U.S. Midwest – will lead to higher prices and greater price stability when they’re in service early in the next decade.