135-555: The Alberta Heritage Savings Trust Fund (HSTF) is a sovereign wealth fund established in 1976 by the Government of Alberta under then- Premier Peter Lougheed . The Heritage Savings Trust Fund was created with three objectives: "to save for the future, to strengthen or diversify the economy, and to improve the quality of life of Albertans." The operations of the Heritage Savings Trust Fund are subject to
270-713: A $ 8.3 billion deficit in his November report, prior to the release in February 2019 of the corrected deficit figures, which was "$ 1.9 billion less in 2018-19 than originally expected", —$ 6.9-billion deficit instead of the original $ 8.8-billion". Alberta's current deficit is "unusual for the province", says Tombe in 2018. During the financial crisis, Alberta's "net asset position equivalent to 15 per cent of GDP"−it "owned more financial assets than it owed in debt." In 2009 Alberta had $ 31.7 billion in financial assets. On December 3, 2019, Moody's downgraded Alberta's credit rating from Aa2 stable from Aa1 negative and "downgraded
405-420: A 10 per cent coupon . Alberta amended the policy on Canada Investment Division loans in the 1979-80 fiscal year to allow all provincial governments to borrow at the interest rate of the province with the strongest creditworthiness , a benefit for provinces who would otherwise be required to borrow at higher interest rates on the open market. The highest credit rating and default benchmark for all other provinces
540-530: A 2014 study, SWFs are not created for reasons related to reserve accumulation and commodity-export specialization. Rather, the diffusion of SWF can best be understood as a fad whereby certain governments consider it fashionable to create SWFs and are influenced by what their peers are doing. As market participants, SWFs influence other institutional investors, who may see investments made alongside SWFs as inherently safer. This effect can be seen with increasing frequency, especially with regard to investments made by
675-437: A base of resource extraction in their hinterlands. However, Calgary is predominant in hosting the regional and national headquarters of oil and gas exploration and drilling companies. Edmonton skews much more towards governments, universities and hospitals as large employers, while Edmonton's suburban fringes (e.g. Fort Saskatchewan , Nisku , Strathcona County ( Refinery Row ), Leduc , Beaumont , Acheson ) are home to most of
810-642: A billion-dollar umbrella over mortgage holders, small businesses, and farmers. In the announcement to address the recession , Lougheed stressed the diversion of funds from the Heritage Trust Fund would only be temporary, and the concept of the fund would remain intact. The Legislature passed the Alberta Heritage Savings Trust Fund Amendment Act, 1983 (Bill 18) which repealed the diversion of 30 per cent of non-renewable resource revenue and provided for
945-734: A central bank, which accumulates the funds in the course of its management of a nation's banking system; this type of fund is usually of major economic and fiscal importance. Other sovereign wealth funds are simply the state savings that are invested by various entities for investment return, and that may not have a significant role in fiscal management. The accumulated funds may have their origin in, or may represent, foreign currency deposits, gold, special drawing rights (SDRs) and International Monetary Fund (IMF) reserve positions held by central banks and monetary authorities, along with other national assets such as pension investments, oil funds, or other industrial and financial holdings. These are assets of
1080-567: A deposit of $ 500-million in the Heritage Savings Trust Fund over that period. In October 2020, the Government of Alberta announced a review of the investment policy for the Heritage Savings Trust Fund. The Trust Fund faced significant losses from a volatility-based investment strategy during the COVID-19 recession . The volatility-based strategy resulted in direct losses of $ 411-million, which were compounded by other global market losses from
1215-586: A key industry since the 1870s. The climate is dry, temperate , and continental , with extreme variations between seasons. Productive soils are found in most of the southern half of the province (excluding the mountains), and in certain parts of the north. Agriculture on a large scale is practiced further north in Alberta than anywhere else in North America, extending into the Peace River country above
1350-480: A large presence in the industries that have traditionally started industrialization in other places (notably the original Industrial Revolution in Great Britain) but which require large labour forces , and large internal markets or easy transportation to export markets, namely textiles , metallurgy , or transportation-related manufacturing ( automotives , ships , or train cars ). Agriculture has been
1485-507: A notable exception to this more typical model. Stabilization SWFs are created to reduce the volatility of government revenues, to counter the boom-bust cycles' adverse effect on government spending and the national economy. Savings SWFs build up savings for future generations. One such fund is the Government Pension Fund of Norway . It is believed that SWFs in resource-rich countries can help avoid resource curse , but
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#17327915878321620-472: A number of investments which brought negative attention to the fund and government. The 1987 loan of $ 120-million to Millar Western for a Whitecourt pulp mill which the government never received interest or principle payments on despite the province awarding the company several contracts. The province lost $ 244.2-million on the loan and in 1994 took a 60 per cent ownership stake in Millar Western which
1755-409: A parkland region (with isolated patches of prairie, hence the name) in the northwest isolated from the rest of the parkland by the forested Swan Hills . Fort McMurray is the only urbanized population centre in the boreal forest which covers much of the northern half of the province. The Calgary and Edmonton regions, by far the province's two largest metropolitan regions, account for the majority of
1890-566: A record of over US$ 50 per barrel. In response, then Premier Rachel Notley made a December 2 announcement of a mandatory cut of 8.7% in Alberta's oil production. By December 12, after the announcement of the government's "mandated oil output curtailment", the price of WCS rose c. 70% to c. US$ 41 a barrel with the WTI differential falling from US50 to c. US$ 11., according to the Financial Post . The WCS price rose to US$ 28.60 by January 2019, as
2025-401: A significant rebound in oil-related investments...Alberta's oil and gas sector is carbon-intensive and Alberta's greenhouse gas emissions are the highest among provinces. Alberta is also susceptible to natural disasters including wildfires and floods which could lead to significant mitigation costs by the province." In 2006 Alberta's per capita GDP was higher than all US states , and one of
2160-492: A single economic region as the TD study did in 2003 was novel. The more traditional view had been to see the two cities as economic rivals. For example, in the 1980 both cities claimed to be the "Oil Capital of Canada". Alberta has always been an export-oriented economy . In line with Harold Innis ' " Staples Thesis ", the economy has changed substantially as different export commodities have risen or fallen in importance. In sequence,
2295-549: A small internal market, and it is relatively distant from major world markets , despite good transportation links to the rest of Canada and to the United States to the south . Alberta is located in the northwestern quadrant of North America , in a region of low population density called the Interior Plains . Alberta is landlocked , and separated by a series of mountain ranges from the nearest outlets to
2430-463: A source of criticism for Alberta governments, as the value of the fund has failed to grow at the pace of provincial non-renewable natural resource revenues, which between 1980 and 2014 accounted totaled almost $ 190 billion, while the value of the Heritage Fund in 2014 was only $ 17.3 billion. The fund was established in 1976 accruing 30 per cent of provincial non-renewable resource revenues, which
2565-748: A ten-year period from July 2009 to July 2019, was in September 2013 at 4.3%. The unemployment rate in the spring of 2019 in Alberta was 6.7% with 21,000 jobs added in April. By July 2019, the seasonally adjusted unemployment rate had increased to 7.0%. By August 2019, the employment number in Alberta was 2,344,000, following the loss of 14,000 full-time jobs in July, which represented the "largest decline" in Canada according to Statistics Canada. Beginning in June 2014,
2700-606: A typical worker earns today goes about as far as $ 1,000 did nearly a decade ago.", according to Tombe. In spite of the typical worker in Alberta earns $ 1,183 per week compared to Saskatchewan, where the typical worker earns $ 1,070 per week. The weekly income a typical worker in all the other Canadian provinces and territories is less than that. Since 2014, sectors that offered high-wage employment of $ 30 and above, saw about 100,000 jobs disappear—"construction (down more than 45,000 jobs), mining, oil and gas (down nearly 35,000), and professional services (down 18,000)." Alberta's net debt
2835-482: A year. By 2009 with natural gas prices at a long-term low, Alberta's economy was in poor health compared to before, although still relatively better than many other comparable jurisdictions. By 2012 natural gas prices were at a ten-year low, the Canadian dollar was high, and oil prices recovered until June 2014. The spin-offs from petroleum allowed Alberta to develop many other industries. Oilpatch-related manufacturing
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#17327915878322970-434: Is a highly developed one in which most people work in services such as healthcare, government, or retail. Primary industries are also of great importance, however. By March 2016 the unemployment rate in Alberta rose to 7.9%— its "highest level since April 1995 and the first time the province’s rate has surpassed the national average since December 1988." There were 21,200 fewer jobs than February 2015. The unemployment rate
3105-419: Is a state-owned investment fund that invests in real and financial assets such as stocks , bonds , real estate, precious metals , or in alternative investments such as private equity funds or hedge funds . Sovereign wealth funds invest globally. Most SWFs are funded by revenues from commodity exports or from foreign exchange reserves held by the central bank . Some sovereign wealth funds may be held by
3240-524: Is an obvious example, but financial services and government services have also benefited from oil money. A comparison of the development of Alberta's less oil and gas-endowed neighbours, Saskatchewan and Manitoba, reveals the role petroleum has played. Alberta was once the smallest of the three Prairie Provinces by population in the early 20th century, but by 2009, Alberta's population was 3,632,483 or approximately three times as much as either Saskatchewan (1,023,810) or Manitoba (1,213,815). Alberta's economy
3375-630: Is due to political instability, while economic determinants generally play a less important role. SWFs in unstable countries may provoke risks for recipient states of SWF investments, given that the instability in SWF-sponsor countries makes those investments uncertain and likely to be disinvested to weather political risk in the short-term. Highly stable countries, such as Denmark, Qatar, China, or Australia are less likely to experience SWF depletion precisely because of their political stability. Economy of Alberta The economy of Alberta
3510-538: Is not always possible or desirable to hold this excess liquidity as money or to channel it into immediate consumption. This is especially the case when a nation depends on raw material exports like oil, copper or diamonds. In such countries, the main reason for creating a SWF is because of the properties of resource revenue: high volatility of resource prices, unpredictability of extraction, and exhaustibility of resources. SWFs are primarily commodity-based and many have been established by oil-rich states. SWFs of China are
3645-748: Is now served by two major transcontinental railways ( CN and CP ), by three major highway connections to the Pacific (the Trans-Canada via Kicking Horse Pass , the Yellowhead via Yellowhead Pass and the Crowsnest via Crowsnest Pass ), and one to the United States ( Interstate 15 ), as well as two international airports ( Calgary and Edmonton ). Also, Alberta is connected to the TransCanada pipeline system (natural gas) to Eastern Canada,
3780-704: Is now worth $ 853 billion. Another early registered SWFs is the Revenue Equalization Reserve Fund of Kiribati . Created in 1956, when the British administration of the Gilbert Islands in Micronesia put a levy on the export of phosphates used in fertilizer , the fund has since then grown to $ 520 million. SWFs are typically created when governments have budgetary surpluses and have little or no international debt. It
3915-538: Is the sum of all economic activity in Alberta , Canada's fourth largest province by population . Alberta's GDP in 2018 was CDN$ 338.2 billion. Although Alberta has a presence in many industries such as agriculture, forestry, education, tourism, finance, and manufacturing, the politics and culture of the province have been closely tied to the production of fossil energy since the 1940s. Alberta—with an estimated 1.4 billion cubic metres of unconventional oil resource in
4050-564: Is widely believed most have diversified hugely into assets other than short-term, highly liquid monetary ones, though almost no data is publicly available to back up this assertion. The term "sovereign wealth fund" was first used in 2005 by Andrew Rozanov in an article entitled, "Who holds the wealth of nations?" in the Central Banking Journal . The previous edition of the journal described the shift from traditional reserve management to sovereign wealth management; subsequently
4185-520: The Alberta Heritage Savings Trust Fund Act and with the goal of providing "prudent stewardship of the savings from Alberta's non-renewable resources by providing the greatest financial returns on those savings for current and future generations of Albertans." Between 1976 and 1983 the Government of Alberta deposited a portion of oil revenue into the fund. The Heritage Savings Trust Fund used oil revenues to invest for
Alberta Heritage Savings Trust Fund - Misplaced Pages Continue
4320-726: The 1971 election ending the 36-year Social Credit government. The Progressive Conservatives promised change and began quickly with public consultations on energy policy. The previous Social Credit government limited royalties on oil and gas at 16.6 per cent, which was written into each mineral lease. The result of the consultation and government analysis concluded public ownership share of energy resources should be higher, oil and natural gas were priced below value, resource upgrading and employment in Alberta must be increased, and Albertans deserved greater investment opportunity for public-owned resources. The government of Alberta made efforts to increase export prices of oil and natural gas in 1972, which
4455-495: The 55th parallel north . Generally, however, northern Alberta (and areas along the Alberta Rockies ) is forested land and logging is more important than agriculture there. Agriculture is divided into primarily field crops in the east, livestock in the west, and a mixture in between and in the parkland belt in the near north. Conventional oil and gas fields are found throughout the province on an axis running from
4590-488: The Calgary Chamber of Commerce , the COVID-19 pandemic in Alberta and its "economic fallout will permanently reshape our economy." Hirsch said that he expects that the resulting contraction in Alberta's economy will be the "worst...Alberta has ever seen." The global price of oil decreased dramatically because of the combination of COVID-19 pandemic and the 2020 Russia–Saudi Arabia oil price war . In March 2020,
4725-538: The Fiscal Management Act requiring the Government of Alberta to deposit to the Trust Fund five per cent of the first $ 10-billion of non-renewable resource revenue, 25 per cent of the next $ 5-billion and 50 per cent of all non-renewable resource revenue in excess of $ 15-billion. Based on a look back at non-renewable resource revenue between 2000 and 2013, on average, the proposal would have resulted in
4860-478: The Fraser Institute concluded that Alberta should be saving more of its non-renewable resource revenues. The report noted that since 1980, the non-renewable resource revenues in Alberta has generated almost $ 190-billion, but the value of the Heritage Fund was only $ 17.3-billion in 2014. After 1987, non-renewable resource revenue was no longer added to the Heritage Fund. The Fraser Institute report compared
4995-470: The Great Recession , reducing the fund's value to $ 14-billion. Peter Lougheed – whose government created the fund in 1976 – spoke critically of the fund's management and failure to diversify the Alberta economy, noting the fund was valued at $ 14-billion in 1985 when he retired from provincial politics. The fund did not recover these 2009 losses for another five years when
5130-743: The Kuwait Investment Authority during the Gulf War managed excess reserves above the level needed for currency reserves (although many central banks do that now). The Government of Singapore Investment Corporation , Temasek Holdings , or Mubadala are partially the expression of a desire to bolster their countries' standing as an international financial centre. The Korea Investment Corporation has since been similarly managed. Sovereign wealth funds invest in all types of companies and assets, including startups like Xiaomi and renewable energy companies like Bloom Energy. According to
5265-794: The Northern Border Pipeline (gas), Alliance Pipeline (gas) and Enbridge Pipeline System (oil) to the Eastern United States, the Gas Transmission Northwest and Northwest Pipeline (gas) to the Western United States, and the McNeill HVDC Back-to-back station (electric power) to Saskatchewan. Since the days of early agricultural settlement, the majority of Alberta's population has been concentrated in
5400-788: The Pacific Ocean , and by the Canadian Shield from ports on the Lakehead or Hudson Bay . From these ports to major populations centres and markets in Europe or Asia is several thousands of kilometers. The largest population clusters of North America (the Boston ;– Washington , San Francisco - San Diego , Chicago – Pittsburgh , and Quebec City – Windsor Corridors ) are all thousands of kilometers away from Alberta. Partly for this reason, Alberta has never developed
5535-606: The US$ 1.2-trillion sovereign wealth fund established in 1990 to invest surplus revenues of the Norwegian petroleum sector . Norway's fund has grown significantly, increasing in value by 13 times between 2002 and 2017, furthermore the Norwegian government is only able to withdraw up to 3 per cent of the fund's value each year, with the first withdrawal taking place in 2016. In their August 2015 contrast for The Globe and Mail between
Alberta Heritage Savings Trust Fund - Misplaced Pages Continue
5670-490: The droughts of the 1920s and 30s. The chernozem (black soil) of the parkland region is more agriculturally productive than the red and grey soils to the south. Urban development has also been most advanced in the parkland belt. Edmonton and Red Deer are parkland cities, while Calgary is on the parkland-prairie fringe. Lethbridge and Medicine Hat are prairie cities. Grande Prairie lies in the Peace River Country
5805-567: The parkland belt (mixed forest-grassland), a boomerang-shaped strip of land extending along the North Saskatchewan River from Lloydminster to Edmonton and then along the Rocky Mountain foothills south to Calgary. This area is slightly more humid and treed than the drier prairie (grassland) region called Palliser's Triangle to its south, and large areas of the south (the " Special Areas ") were depopulated during
5940-448: The price of oil , and increasingly natural gas prices . When oil prices spiked during the 1967 Oil Embargo , 1973 oil crisis , and 1979 energy crisis , Alberta's economy boomed. However, during the 1980s oil glut Alberta's economy suffered. Alberta boomed once again during the 2003-2008 oil price spike . In July 2008 the price of oil peaked and began to decline and Alberta's economy soon followed suit, with unemployment doubling within
6075-425: The "lowest taxes overall of any province or territory" in Canada, due in part to having high resource tax revenues. However, overall tax revenues from oil royalties and other non-renewable sources has fallen steeply along with the drop in global oil prices. For example, in 2013, oil tax revenues brought in 9.58 billion, or 21% of the total Provincial budget, whereas in 2018 it had fallen to just 5.43 billion, or 11% of
6210-699: The "political temptation" to "raid" the Fund and offered the Canadian Pension Plan Investment Board (CPPIB), a Crown corporation, the largest pension fund in Canada, as a model. By March 2015 the CPPIB fund had grown to $ 219-billion and made a 16.5 per cent rate-of-return in 2013. Max Fawcett, the editor of Alberta Oil magazine, warned that the newly proposed Alberta Future Fund from the Premier's Council for Economic Strategy, which
6345-829: The Alaskan formula, by 2011 the Heritage Savings Trust Fund would have had a value of $ 42.4-billion instead of $ 9.1-billion. Under the Norway fund deposit requirements, Alberta's Heritage Savings Trust Fund would have reached $ 121.9-billion by 2011. In its annual report on the Canadian economy in February 2013, the Washington-based International Monetary Fund (IMF) urged Canada, and resource-rich provinces like Alberta and Quebec to "better manage boom-and-bust commodities cycles by stashing away more tax revenue in good times". IMF mission chief for Canada, Roberto Cardarelli, suggested that Norway, with
6480-503: The Alberta Heritage Fund to Norway's pension fund and Alaska's Alaska Permanent Fund and argued that Alberta's was significantly "smaller than others because of its relative under-funding and chronic withdrawals of most income from the fund." Alaska for example continued to deposit 25 per cent of its non-renewable resource revenue from 1982 to 2011 and Norway contributed 100 percent. The report noted if Alberta had followed
6615-687: The Alberta Heritage Savings Trust Fund and the Norwegian Government Pension Fund Global , Brian Milner and Jeff Lewis wrote that Norway parks 100 per cent of its non-renewable resource revenue from royalties and dividends in a fund that is barred from investing a krone in the domestic economy, while the Heritage Savings Trust Fund has invested heavily in Alberta. Reports by the Canadian Centre for Policy Alternatives and
6750-561: The Canadian average of $ 47,417. Alberta's A grade on its income per capita was based on the fact that it was almost "identical" to that of the "top peer country" in 2016, Ireland. In 2017, Alberta's real per capita GDP—the economic output per person—was $ 71,092 compared to the Canadian average output per person of $ 47, 417 and Prince Edward Island at $ 32,123 per person. Since at least 1997, Alberta's per capita GDP has been higher than that of any other province. In 2014, Alberta's reached its highest gap ever—$ 30,069—between its real capita GDP and
6885-548: The Canadian average. According to the Conference Board of Canada , in 2016 Alberta earned an "A grade with income per capita almost identical to the top peer country, Ireland." In 2016 income per capita in Alberta was $ 59,259. A table listing annual " "Gross domestic product (GDP) at basic prices, by industry, provinces and territories (x 1,000,000)." from 2014 through 2018 with value chained to 2012 dollars. Source: Statistics Canada : GDP (totals), Alberta has
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#17327915878327020-741: The Commercial Investment Division to hold a portfolio of securities, and the Energy Investment Division to make investments in energy capacity across Canada, which was closed shortly afterward owing to the National Energy Program. Eventually, Provincial Treasurer Lou Hyndman announced the province would indefinitely suspend the Canada Investment Division and the possibility of future inter-provincial loans issued by
7155-465: The Fund provided loans to provincial governments and Crown Corporations in the provinces of Newfoundland and Labrador, Nova Scotia , Manitoba , New Brunswick , Prince Edward Island , and Quebec through Hydro Quebec . Loans under the Canada Investment Division grew to $ 1.9-billion by the time the program was suspended in May 1984. In certain circumstances loans to other Canadian provinces failed to support
7290-568: The Fund's $ 11.8-billion assets placed in the Transition Portfolio. The Transition Portfolio invested primarily in interest-bearing securities for a steady stream of income, while the Endowment Portfolio was split between fixed-income securities and equities both between 35 and 65 per cent of the fund. The Alberta economy's recovery from the early 1990s recession was jumpstarted by the 2000s energy crisis , which saw
7425-535: The Government Pension Fund of Norway, Abu Dhabi Investment Authority , and Temasek Holdings, and China Investment Corporation. SLFs help facilitate a state's ability to use its selective equity investments to promote its industrial policies and strategic interests. The growth of sovereign wealth funds is attracting close attention because: The governments of SWFs commit to follow certain rules: A number of transparency indices sprang up before
7560-505: The Heritage Savings Trust Fund and the remaining $ 273-million applied to the provincial debt. Calls to amend the Alberta Heritage Savings Trust Fund legislation to make the fund "inflation-proof" dated back to the 1990s as successive governments withdrew large portions of the Fund's investment interest. The Alberta Heritage Savings Trust Fund Act (Bill 32) was introduced by the Progressive Conservative government during
7695-421: The Heritage Savings Trust Fund and withdrew all interest income from the fund into general revenues. The decision to suspend non-renewable natural resource deposits provided an estimated additional $ 216-million to the treasury, and an additional $ 1.4-billion in investment income transfers. The decision in effect capped the fund at $ 12.7-billion. The $ 1.4-billion investment income transfer amounted to 19.7 per cent of
7830-410: The Heritage Trust Fund. Funds would instead be used on investments in Alberta. The 1982-83 fiscal year marked the first occasion when income generated in the fund was utilized for general government purposes with the transfer of $ 866-million to Alberta's General Revenue Fund while retaining $ 1,986-million. Lougheed announced to Albertans that the " rainy day " had arrived and the government intended to put
7965-478: The IMF call for "stabilization funds" arguing that every province in Canada should consider establishing a sovereign wealth fund, as global peers have done, and treat non-renewable resource revenue as "capital to be saved and invested, rather than income to be spent." She added that in provinces like Alberta where the Fund already exists, it "should be implemented with a great deal more rigour." Drohan warned in 2013 against
8100-472: The Legislature further refined the purpose of the fund, stating it was not to transform Alberta into an "industrial state", stating he did not want smoke-stacks, but instead the "best jobs" and "brain power". Lougheed and the Progressive Conservative campaign was successful, and he returned to power with a strong majority government controlling 69 of 75 seats in the Legislature. The fund was created with
8235-604: The Lloydminster Bi-Provincial Upgrader for heavy oil with Husky Oil and the Government of Saskatchewan, and the Alberta-Pacific Forest Industries pulp mill. By 1993 the government's decisions to reduce and eventually eliminate non-renewable natural resource revenue in 1983 and 1987 combined with the diversion of interest revenue from the fund to general revenue had reached $ 15.4-billion in diversion, more than double
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#17327915878328370-498: The Lloydminster upgrader to Husky Oil only four years later in 1998 for $ 310-million, fully recovering Saskatchewan's investment in the project. The Heritage Savings Trust Fund has proven to be a target of criticism from a wide spectrum of authors and organizations representing many positions on social and economic scales. The Alberta Heritage Savings Trust Fund often draws comparisons to the Government Pension Fund of Norway ,
8505-873: The Principles, representing collectively 80% of the assets managed by sovereign funds globally or US$ 5.5 trillion. Assets under management of SWFs amounted to $ 7.94 trillion as of 24 December 2020. Countries with SWFs funded by oil and gas exports, totaled $ 5.4 trillion as of 2020. Non-commodity SWFs are typically funded by transfer of assets from official foreign exchange reserves, and in some cases from government budget surpluses and privatization revenues. Middle Eastern and Asian countries account for 77% of all SWFs. Numerous SWFs have gone bust throughout history. The most notable ones have been Algeria's FRR, Brazil's FSB , Ecuador's numerous SWF arrangements, Papua New Guinea's MRSF, and Venezuela's FIEM and FONDEN. The main reason why these funds have been exhausted
8640-524: The Provincial budget. In the spring of 2020, Alberta's economy suffered from the economic fallout of both the COVID-19 pandemic and the 2020 Russia–Saudi Arabia oil price war ." GDP by sector, 2016 (in bil. CA-Dollar) (in CA-Dollar) (in %) According to ATB Financial 's Vice President and Chief Economist— Todd Hirsch , who spoke during an April 2, 2020, webinar hosted by
8775-658: The Santiago Principles, some more stringent than others. To address these concerns, some of the world's main SWFs came together in a summit in Santiago , Chile, on 2–3 September 2008. Under the leadership of the IMF, they formed a temporary International Working Group of Sovereign Wealth Funds. This working group then drafted the 24 Santiago Principles , to set out a common global set of international standards regarding transparency, independence, and accountability in
8910-399: The United States benchmark crude oil EWest Texas Intermediate (WTI)—upon which Alberta's benchmark crude oil Western Canadian Select (WCS) price is based—dropped to an historical below of US$ 20 a barrel. The price of WCS bitumen-blend crude was US$ 3.82 per barrel by the end of March. In 2018, the low price of heavy oil negatively impacted Alberta's economic growth. In November 2018,
9045-608: The United States. While the PSF was first funded by an appropriation from the state legislature, it also received public lands at the same time that the PUF was created. The first SWF established for a sovereign state is the Kuwait Investment Authority , a commodity SWF created in 1953 from oil revenues before Kuwait gained independence from the United Kingdom. As of July 2023, Kuwait's Sovereign Wealth Fund, or locally known as Ajyal Fund,
9180-569: The absence of Legislature control over investments noting matters concerning investment are traditionally the prerogative of the government. The Alberta Heritage Savings Trust Fund's first year of operations saw the legislated deposit of $ 1,500-million in assets from the Government of Alberta, $ 620-million in deposits resulting from 30 per cent of the Province's non-renewable resource revenue, and $ 88-million in investment earnings. The initial $ 1,500-million transfer included $ 254.5-million in cash, with
9315-556: The absence of public consultation in the development of overarching legislation, Cabinet's control over 80 per cent of the fund's investments, leaving the Legislature with control over 20 per cent of the fund's assets. The Progressive Conservative government made concessions to give the Legislature power to vote on deposits made into the fund each year, but Premier Lougheed called giving the Legislature additional control over investments impractical, naïve and ridiculous. Progressive Conservative Government House Leader Lou Hyndman rationalized
9450-482: The allocation of all non-renewable resource royalties to make investments in firms, projects, and infrastructure that would encourage economic activity – without necessarily providing a financial return on investment. Despite the recommendations of the report, the Government did not create the Future Fund. Under Premier Alison Redford and Finance Minister Doug Horner , the 28th Legislature passed
9585-499: The arrival of the Canadian Pacific Railway 's transcontinental line in 1880s. Commercial farming became viable in the area once the grain trade had developed technologies to handle the bulk export of grain, especially hopper cars and grain elevators . Oil and gas exports have been possible because of increasing pipeline technology. Prior to the 1950s, Alberta was a primarily agricultural economy, based on
9720-483: The asset management firm for the province of Alberta. AIMCo transferred control of the province's various financial assets, which had previously been managed by a division of the Alberta Ministry of Finance. AIMCo's mandate included managing the Heritage Savings Trust Fund from that point onward. Public criticism reignited in 2009 when it was announced the Heritage Savings Trust Fund had lost $ 3-billion during
9855-422: The bituminous oil sands —leads Canada as an oil producer. In 2018, Alberta's energy sector contributed over $ 71.5 billion to Canada's nominal gross domestic product. According to Statistics Canada , in May 2018, the oil and gas extraction industry reached its highest proportion of Canada's national GDP since 1985, exceeding 7% and "surpass[ing] banking and insurance" with extraction of non-conventional oil from
9990-482: The economist, Trevor Tombe . There was a decrease in wages, in the number of jobs, and in the number of hours worked. The total loss of incomes from "workers, business, and government" amounted to about 20 percent or about CDN$ 75 billion less per year. Since 2011, prices have increased in Alberta by 18%. However, a typical worker in Alberta still earns more than a typical worker in all the other provinces and territories. By March 2016, Alberta lost over 100,000 jobs in
10125-534: The election, and Premier Lougheed used the opportunity to outline the policy behind the fund. The fund would be used to diversify and strengthen the Alberta economy , improve the capacity and quality of life for future Albertans, stimulate the economy and continue to accumulate interest on the principal. Furthermore, Lougheed stated the funds would not be invested in a way as to interfere with private sector activity, or disrupt existing financial institutions, and primarily be invested inside Alberta. Lougheed in debates in
10260-445: The export of wheat , beef , and a few other agricultural products. The health of economy was closely bound up with the price of wheat . In 1947 a major oil field was discovered near Edmonton. It was not the first petroleum find in Alberta, but it was large enough to significantly alter the economy of the province (and coincided with growing American demand for energy). Since that time, Alberta's economic fortunes have largely tracked
10395-449: The fastest-growing regions in the country. A 2003 study by TD Bank Financial Group found the corridor was the only Canadian urban centre to amass a U.S. level of wealth while maintaining a Canadian-style quality of life, offering universal health care benefits. The study found GDP per capita in the corridor was 10% above average U.S. metropolitan areas and 40% above other Canadian cities at that time. Seeing Calgary and Edmonton as part of
10530-511: The final payment was made. The growing provincial treasury led to three years of deposits in the Heritage Savings Trust Fund in 2005-06 ($ 1.75-billion), 2006-07 ($ 1.25-billion), and 2007-08 ($ 918-million); the first deposits to the Fund in 19 years. In 2008, the Government of Alberta created the Alberta Investment Management Corporation (AIMCo), a Crown corporation owned by the provincial government as
10665-407: The fourth session of the 23rd Alberta Legislature and received Royal Assent on May 23, 1996. The Act reorganized the fund, focusing on a period of temporary short-term investments for the benefit of the provincial treasury while transitioning the Fund to long-term investments by 2005. This change was facilitated through a separate "Transition Portfolio" and "Endowment Portfolio", with $ 10.6-billion of
10800-466: The fund claimed $ 2.8-billion on "deemed assets" which could not be liquidated or in any way recovered by the province. Furthermore, opposition MLAs Nicholas Taylor, and Sheldon Chumir claimed the fund created a needless backlash against Albertans in Toronto and Ottawa. As Alberta's economy continued to falter in the late 1980s, calls from both inside and outside Alberta were made to use the Fund to reduce
10935-445: The fund's 1993 value of $ 15.3-billion. The Alberta Heritage Savings Trust Fund underwent several changes with Ralph Klein 's successful leadership campaign for the Progressive Conservative party and subsequent success in the 1993 Alberta general election . Klein was a staunch believer that private enterprise should dictate market activity and government "should not be in the business of business". The Alberta Heritage Savings Trust Fund
11070-404: The fund's assets invested in projects with long-term economic or social benefits to Albertans. The Canada Investment Division with up to 15 per cent of the fund's assets made loans to other governments or government agencies in Canada. The Alberta Investment Division sought opportunities in Alberta where investments would strengthen and diversify the economy . The fund was initially criticized for
11205-531: The fund. Non-renewable resource revenue included any revenue received by the Alberta government related to agreements or bonuses under the Mines and Minerals Act , including royalty or in lieu of royalty for bituminous sands leases. The Act also created the 15-person Legislature Committee to review the operations of the fund, but not manage any of the investments. The fund was divided into three investment divisions. The Capital Projects Division with up to 20 per cent of
11340-554: The goals of the Heritage Savings Trust Fund, as the Province of Quebec used loans to subsidize agricultural development in the early 1980s, leadings to a reduction in Alberta livestock exports to Quebec. Under Peter Lougheed, $ 25.5-million from the Heritage Savings Trust Fund was used for the construction of the Kananaskis Country Golf Course as a measure to promote the diversification of the province's economy. The Alberta Heritage Savings Trust Fund has had
11475-466: The goods sector lost 56,000 jobs, while the services sector gained 34,800." In 2015 Alberta's population increased by 3,900. While Alberta had a reprieve in job loss in February 2016—up 1,400 jobs after losing jobs in October, November, December 2015 and January 2016—Ontario lost 11,200 jobs, Saskatchewan lost 7,800 jobs and New Brunswick lost 5,700 jobs. The unemployment rate in spring 2019 in Alberta
11610-463: The government's "mandated oil output curtailment", has resulted in a sustained rebound in WCS prices. However, investment and spending were low in the province. The loss of 14, 000 of the full-time jobs out of 2,344,000 in Alberta in July 2019, represented the "largest decline" in employment in Canada for that month, according to Statistics Canada. In 1985, Alberta's energy industry accounted for 36.1% of
11745-642: The highest figures in the world . In 2006, the deviation from the national average was the largest for any province in Canadian history. Alberta's per capita GDP in 2007 was by far the highest of any province in Canada at C$ 74,825 (approx. US$ 75,000). Alberta's per capita GDP in 2007 was 61% higher than the Canadian average of C$ 46,441 and more than twice that of all the Maritime provinces . From 2004 to 2014 Alberta's "exports of commodities rose 91%, reaching $ 121 billion in 2014" and 500,000 new jobs were created. In 2014, Alberta's real GDP by expenditure grew by 4.8%,
11880-463: The highest figures in the world . In 2006, the deviation from the national average was the largest for any province in Canadian history. In 2007, Alberta's per capita GDP in 2007 was C$ 74,825 (approx. US$ 75,000)—by far the highest of any Canadian province—61% higher than the Canadian average of C$ 46,441 and more than twice that of all the Maritime provinces . In 2017, Alberta's real per capita GDP—the economic output per person—was $ 71,092, compared to
12015-421: The inflation-adjusted price of a barrel of crude oil on NYMEX rise above US$ 30 in 2003, reached US$ 60 by 11 August 2005, and peaked at US$ 147.30 in July 2008. Provincial government revenues from oil and gas royalties grew leading Premier Klein to declare the province "debt free" in July 2004; this included the province having set aside enough money to make payments on outstanding locked-in debts until 2013 when
12150-553: The international price of oil had begun to recover from the December "sharp downturn" caused by the ongoing China–U.S. trade war In March 2019, the differential of WTI over WCS decreased to $ US9.94 as the price of WTI dropped to US$ 58.15 a barrel, which is 7.5% lower than it was in March 2018, while the price of WCS increased to US$ 48.21 a barrel which is 35.7% higher than in March 2018. According to TD Economics' September 2019 report,
12285-524: The largest sovereign wealth fund, is an example Canada should follow; the suggestion to Canada missed that, unlike Norway, resource royalties are a provincial level revenue stream, not a federal level revenue stream In 2013 Madelaine Drohan , author of the Canadian International Council report entitled The 9 Habits of Highly Effective Resource Economies: Lessons for Canada ,and a Canadian correspondent for The Economist , echoed
12420-488: The last half of 2012. In the first half of 2014, global sovereign wealth fund direct deals amounted to $ 50.02 billion according to the SWFI. Sovereign wealth funds have existed for more than a century, but since 2000, the number of sovereign wealth funds has increased dramatically. The first SWFs were non-federal U.S. state funds established in the mid-19th century to fund specific public services. The U.S. state of Texas
12555-484: The literature on this question is controversial. Governments may be able to spend the money immediately, but risk causing the economy to overheat, e.g., in Hugo Chávez 's Venezuela or Shah -era Iran. In such circumstances, saving money to spend during a period of low inflation is often desirable. Other reasons for creating SWFs may be economic, or strategic, such as war chests for uncertain times. For example,
12690-460: The long term in such areas as health care, education and research and as a way of ensuring that the development of non-renewable resources would be of long-term benefit to Alberta. The strategy and goals of the fund have changed through successive provincial governments which moved away from direct investments in Alberta to a diversified approach, which now includes stocks, bonds, real estate and other ventures. The Heritage Savings Trust Fund has been
12825-500: The long-term debt ratings of the Alberta Capital Finance Authority and the long-term issuer rating of ATB Financial to Aa2 from Aa1." The agency said that there is a "structural weakness in the provincial economy that remains concentrated and dependent on non-renewable resources ... and remains pressured by a lack of sufficient pipeline capacity to transport oil efficiently with no near-term expectation of
12960-452: The market value returned to $ 17-billion in 2014. Premier Ed Stelmach formed the Premier's Council for Economic Strategy in 2011. The council's report, Shaping Alberta's Future , proposed several government programs and policies for Alberta to remain competitive into the 2040s. Among the suggested programs was the creation of a Shaping the Future Fund, similar to the Heritage Savings Trust Fund. The proposed Future Fund would be funded through
13095-645: The market. SWFs grew rapidly between 2008 and 2021, with global assets under management by these funds increasing from approximately $ 4 trillion to more than $ 10 trillion. SWFs invest in a variety of asset classes such as stocks, bonds, real estate, private equity and hedge funds. Many sovereign funds are directly investing in institutional real estate. According to the Sovereign Wealth Fund Institute's transaction database around US$ 9.26 billion in direct sovereign wealth fund transactions were recorded in institutional real estate for
13230-420: The most important products have been: fur, wheat and beef, and oil and gas. The development of transportation in Alberta has been crucial to its historical economic development. The North American fur trade relied on birch-bark canoes , York boats , and Red River carts on buffalo trails to move furs out of, and European trade goods into, the region. Immigration into the province was eased tremendously by
13365-491: The northwest to the southeast. Oil sands are found in the northeast, especially around Fort McMurray (the Athabasca Oil Sands ). Because of its (relatively) economically isolated location, Alberta relies heavily on transportation links with the rest of the world. Alberta's historical development has been largely influenced by the development of new transportation infrastructure , (see "trends" below). Alberta
13500-558: The oil patch. In spite of the surplus with the low price of WCS in 2015—99% of Canada's oil exports went to the United States and in 2015 Canada was still their largest exporter of total petroleum—3,789 thousand bpd in September—3,401 thousand bpd in October up from 3,026 thousand bpd in September 2014. By April 2019, two of the major oil companies, still had thousands of workers—Suncor had about 12,500 employees and Canadian Natural Resources had about 10,000 full-time employees. Alberta has
13635-403: The oilsands reaching an "impressive", all-time high in May 2018. With conventional oil extraction "climbed up to the highs from 2007", the demand for Canadian oil was strong in May. From 1990 to 2003, Alberta's economy grew by 57% compared to 43% for all of Canada—the strongest economic growth of any region in Canada. In 2006 Alberta's per capita GDP was higher than all US states , and one of
13770-408: The optics of a balanced budget before a snap election. Only a month after the announcement the 19th Alberta Legislature was dissolved and an election was called for November 2, 1982 . The Don Getty -led Progressive Conservative government facing deteriorating economic conditions and low oil prices tabled a 1987-88 budget that terminated the 15 per cent non-renewable natural resource deposits into
13905-407: The passage of The Alberta Heritage Savings Trust Fund Act (Bill 35) during the second session of the 18th Alberta Legislature , receiving Royal Assent on May 19, 1976. The bill legislated the transfer of $ 1.5-billion (equivalent to $ 7,577,000,000 in 2023) in assets from the Province's General Revenue Fund and committed 30 per cent of the province's annual non-renewable resource revenue into
14040-431: The price of Western Canadian Select (WCS), the benchmark for Canadian heavy crude, hit its record low of less than US$ 14 a barrel, as a "surge of production met limited pipeline space causing bottlenecks." Previously, from 2008 through 2018, WCS had sold at an average discount of US$ 17 against West Texas Intermediate (WTI)—the U.S. crude oil benchmark, but by the fall of 2018, the differential between WCS and WTI reached
14175-531: The project for a commitment of $ 404-million. The Lloydminster upgrader came in 28 per cent above budget at $ 1.63-billion well above budget, and the book value of the plant was listed at $ 148-million. The Alberta government decided to sell the remaining ownership of the plant in 1994 to be absolved of any more liabilities with the project, selling its share in the plant to the Government of Saskatchewan and Husky Oil for $ 32 million. The Government of Saskatchewan under Premier Roy Romanow sold their 50 per cent interest in
14310-600: The province of Alberta received $ 101.3-billion in resource revenues. The authors argued that $ 49.2-billion on programs above inflation and population growth—a deposit of 25 per cent of resource revenues equaling $ 25.3-billion, into the Heritage Fund would not have been unreasonable had program spending been more carefully controlled. The Frasier Institute criticized the province's deposited of $ 4.5-billion during that period which equaled 4.5 per cent of all resource revenues during that period. Sovereign wealth fund A sovereign wealth fund ( SWF ), or sovereign investment fund
14445-482: The province's manufacturing (much of it related to oil and gas). The Calgary-Edmonton Corridor is the most urbanized region in the province and one of the densest in Canada. Measured from north to south, the region covers a distance of roughly 400 kilometres (250 mi). In 2001, the population of the Calgary-Edmonton Corridor was 2.15 million (72% of Alberta's population). It is also one of
14580-461: The province's population. They are relatively close to each other by the standards of Western Canada and distant from other metropolitan regions such as Vancouver or Winnipeg. This has produced a history of political and economic rivalry and comparison but also economic integration that has created an urbanized corridor between the two cities. The economic profile of the two regions is slightly different. Both cities are mature service economies built on
14715-487: The province's revenue in 1987, exceeding personal income tax by approximately $ 230-million. The opposition to the Alberta Heritage Savings Trust Fund grew in Alberta in the 1980s. A green paper on the fund produced by the opposition Liberal Party claimed the value of the fund was half of what the government claimed as many of the assets could not be reasonably sold or liquidated, such as infrastructure upgrades in provincial parks. The Auditor General raised similar concerns as
14850-607: The provinces $ 66.8 billion GDP. In 2006, the mining, oil and gas extraction industry accounted for 29.1% of GDP; by 2012 it was 23.3%; in 2013, it was 24.6% of Alberta's $ 331.9 billion GDP, and in 2016, the mining, oil and gas extraction industry accounted for about 27.9% of Alberta's GDP. By comparison, "In 2017, the federal, provincial and territorial governments spent some $ 724 billion on programs and more than $ 58 billion on interest payments on their public debt, which, combined, amounted to about 36 percent of Canada’s gross domestic product (GDP). Their combined borrowing that year
14985-523: The provincial deficit or pay off provincial debt, however, the Progressive Conservative government was unwilling to reduce the principle of the fund. The Don Getty government faced continued criticism over the handling of the Heritage Savings Trust Fund, particularly the dwindling principal which had seen four consecutive years of reduction by 1991. The funds continued reductions were in part a result of transfers of interest to general revenue and lower earnings from non-interest-bearing investments, in particular
15120-423: The recession" Alberta's economy is "down $ 100 billion per year", compared to what was anticipated. Tombes said that the "boom years that ended in 2014 were the outliers" and the lower earnings in 2019 reflect a "natural adjustment that's moving Alberta to a more normal and balanced labour market." While earnings are lower, because of inflation, prices have increased in Alberta by 18% since 2011. "The $ 1,183 per week
15255-402: The recession, resulting in a total loss in book value of approximately 10 per cent, with a September 2020 month-end value of $ 17.2 billion. As of year-end 2021, the market value of the Trust Fund had risen to $ 18.9 billion. The Alberta Heritage Savings Trust Fund has made a number of different investments in Alberta and Canada since its incorporation in 1976. Under the Canada Investment Division,
15390-500: The record high volume of worldwide oil inventories in storage—referred to as a global oil glut —caused crude oil prices to collapse at near ten-year low prices. By 2016 West Texas Intermediate (WTI)—the benchmark light, sweet crude oil—reached its lowest price in ten years—US$ 26.55. In 2012 the price of WTI had reached US$ 125 and in 2014 the price was $ 100. By February 2016 the price of Western Canadian Select WCS—the Alberta benchmark heavy crude oil—was US$ 14.10 —the cheapest oil in
15525-620: The remaining assets including debentures from the Alberta Housing Corporation, Alberta Home Mortgage Corporation, Alberta Government Telephones , and Alberta Municipal Financing Corporation; as well as shares from Alberta Energy Company , Syncrude Canada Limited , and Canada-Cities Service Limited. The first investment of the Canada Division was the March 8, 1977, private placement loan to the province of Newfoundland and Labrador for $ 50-million for 21 years at
15660-735: The sovereign nations that are typically held in domestic and different reserve currencies (such as the dollar , euro , pound , and yen ). Such investment management entities may be set up as official investment companies, state pension funds, or sovereign funds, among others. There have been attempts to distinguish funds held by sovereign entities from foreign-exchange reserves held by central banks. Sovereign wealth funds can be characterized as maximizing long-term return , with foreign exchange reserves serving short-term "currency stabilization", and liquidity management. Many central banks in recent years possess reserves massively in excess of needs for liquidity or foreign exchange management. Moreover, it
15795-626: The strongest growth rate among the provinces." In 2017, Alberta's real per capita GDP—the economic output per person—was $ 71,092, compared to the Canadian average of $ 47,417. In 2016, Alberta's A grade on its income per capita was based on the fact that it was almost "identical" to that of the "top peer country"—Ireland. The energy industry provided 7.7% of all jobs in Alberta in 2013, and 140,300 jobs representing 6.1% of total employment of 2,286,900 in Alberta in 2017. The unemployment rate in Alberta peaked in November 2016 at 9.1%. Its lowest point in
15930-510: The term gained widespread use as the spending power of global officialdom has rocketed upward. China's sovereign wealth funds entered global markets in 2007. Since then, their scale and scope have expanded significantly. SWFs were the first institutions to use sovereign capital in an effort to contain the financial damage in the early stages of the 2007-2008 global financial crisis . SWFs are able to react quickly in such circumstances because unlike regulators, SWFs actively participate in
16065-491: The transfer in place for a rate of 15 per cent. The following year, the Fund transferred $ 1,469-million to general revenue and retained $ 720-million. Criticism mounted on Peter Lougheed and the Progressive Conservative government from the opposition, with Western Canada Concept leader Gordon Kesler calling the decision "disastrous" and an example of the government's poor financial planning, while Liberal leader Nicholas Taylor called attention to bloated government programs and
16200-622: The way that SWFs operate. These were published after being presented to the IMF International Monetary Financial Committee on 11 October 2008. They also considered a standing committee to represent them, and so a new organisation, the International Forum of Sovereign Wealth Funds was set up to maintain the new standards going forward and represent them in international policy debates. As of 2016, 30 funds have formally signed up to
16335-539: The world. Alberta boom years from 2010 to 2014 ended with a "long and deep" recession that began in 2014, driven by low commodity pricing ended in 2017. By 2019—five years later—Alberta was still in recovery. Overall, there were approximately 35,000 jobs lost in mining, oil and gas alone. Since 2014, sectors that offered high-wage employment of $ 30 and above, saw about 100,000 jobs disappear—"construction (down more than 45,000 jobs), mining, oil and gas (down nearly 35,000), and professional services (down 18,000)," according to
16470-429: Was Ontario Hydro , although neither Ontario Hydro nor the Government of Ontario borrowed from the Fund. The Lougheed government also lifted the ban on loans to the Province of Quebec in September 1979. The Alberta Heritage Savings Trust Fund would go through several changes in the early 1980s under Premier Peter Lougheed's Progressive Conservative government. The provincial government created two new investment divisions,
16605-439: Was $ 27 billion, and their net financial debt at year-end stood at around $ 1.2 trillion, about 54 percent of GDP." In his July 2019 CBC News article, economist Trevor Tombe said that prior to the 2014 recession, Albertans had experienced boom years from 2010 to 2014, with workers earnings reaching exceptional highs. The recession, which "ended over two years ago" in 2017, was "long and deep". By 2019—five years later—the province
16740-575: Was $ 27.5 billion by March 2019, which represents the end of the 2018-19 fiscal year (FY). By November 2018, Alberta's government expenditures were $ 55 billion while the revenue was about $ 48 billion, according to a report by the University of Calgary 's School of Public Policy (SPP) economist, Trevor Tombe. Capital investment amounted to $ 4.3 billion. The provincial government employs more than "210,000 full-time equivalent workers across hundreds of departments, boards and other entities." Tombe, cited
16875-681: Was 6.7% with 21,000 jobs added in April; in Calgary it was 7.4%, in Edmonton it was 6.9%, in Northern Alberta it was 11.2%, and in Southern Alberta it was 7.8%. By July 2019, the seasonally adjusted unemployment rate had increased to 7.0%, which represented an increase of 0.3% from the previous year. The unemployment rate in Alberta peaked in November 2016 at 9.1%. Its lowest point in a ten-year period from July 2009 to July 2019
17010-579: Was accelerated due to the 1973 energy crisis , and legislated royalty increases into existing mineral lease contracts. Other major policy changes included expanding the mandate of the government-owned pipeline Alberta Gas Trunk Lines to include upgrading activities. Finally, the government created the Alberta Energy Company with $ 150-million, half of which was provided by the Legislature and the other half came from Albertans who could purchase $ 10 shares. The Alberta Heritage Savings Trust Fund
17145-420: Was dissolved only days later and the 1975 Alberta general election was scheduled for March 26. Former Progressive Conservative Cabinet Minister Allan Warrack claims the decision to introduce the legislation knowing the legislature would be dissolved was intentional to allow widespread public review, transparency, and accountability. The proposed Alberta Heritage Savings Trust Fund became a central issue during
17280-425: Was expected to average 7.4% in 2016. The Canadian Association of Petroleum Producers (CAPP) claimed that Alberta lost 35,000 jobs in 2015–25,000 from the oil services sector and 10,000 from exploration and production. Full-time employment increased by 10,000 in February 2016 after falling 20,000 in both December 2015 and January 2016. The natural resources industry lost 7,400 jobs in February. "Year-over-year (y/y),
17415-473: Was proposed in 1974 legislation was decided to include the first announced in the 1975-1976 election budget tabled by the Progressive Conservative government led by Premier Peter Lougheed in the 17th Legislature in February 1975. The fund would be established to hold $ 1.5-billion, and scarce details were provided by Provincial Treasurer Gordon Miniely , noting that the fund would be for the betterment of current and future Albertans. The 17th Legislative Assembly
17550-477: Was set to receive $ 200-million a year to "support big-picture projects" and the two "new innovation endowments" announced by Finance Minister Doug Horner in the 2014 budget, would be funded by raiding the Alberta Heritage Savings Trust Fund. There were no new savings. The 2015 Fraser Institute report titled Fumbling the Alberta Advantage , noted that between 2005 and 2014, and adjusted for inflation,
17685-568: Was shifted away from strategic business investments to become a savings tool investing for financial return. Klein began the sell-off of the province's 15 per cent ownership in Syncrude in 1993, selling 5 per cent of the enterprise to Murphy Oil for $ 150-million. Alberta sold its 36 per cent stake in the Alberta Energy Company Ltd. (which eventually became Ovintiv ) for $ 476-million in May 1993, with $ 183-million returned to
17820-536: Was sold in 1996 for $ 28-million. The Alberta-Pacific pulp mill in Athabasca was provided a $ 260-million loan in 1991, and following low pulp prices, the Klein government wrote off $ 155-million in interest and sold the loan in 1998. The governments of Alberta, Saskatchewan and Canada took severe losses on the Lloydminster Bi-Provincial Upgrader during the early 1990s, the Heritage Savings Trust Fund held 24.17 per cent of
17955-492: Was still in recovery. Overall, there were approximately 35,000 jobs lost in mining, oil and gas alone. By 2019, the slow recovery and low earnings growth have resulted in workers getting "fewer hours, fewer jobs and, in some cases, lower wages". Tombe said that from 2014 to 2016, Alberta earned CDN$ 75 billion less per year with the "total incomes of workers, business, and government combined [falling] by nearly 20 per cent". Tombes said that relative to Alberta's "growth path prior to
18090-560: Was subsequently lowered to 15 per cent in 1983 and eliminated in 1987. The Heritage Savings Trust Fund has not been immune to market forces, gaining and losing value according to general market trends. This includes a $ 3-billion loss during the 2009 Great Recession resulting in the fund dropping to its 1985 value of $ 14 billion. The Alberta's Heritage Savings Trust Fund's fair market value was listed at $ 17.5 billion in 2014, and $ 16.3-billion as of 2020. The Progressive Conservative government under Premier Peter Lougheed swept into power after
18225-543: Was thus the first to establish such a scheme, to fund public education. The Permanent School Fund (PSF) was created in 1854 to benefit primary and secondary schools, with the Permanent University Fund (PUF) following in 1876 to benefit universities. The PUF was endowed with public lands, the ownership of which the state retained by terms of the 1845 annexation treaty between the Republic of Texas and
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