Over the next 30 years, Albertans will contribute an estimated $605.9 billion more to the country than they receive

New research confirms what many Albertans have been saying for years: Alberta is the economic engine of Canada and deserves a fairer fiscal relationship with Ottawa.

Revised estimates project that Albertans will send $312.4 billion more to Ottawa than they will receive back between 2025 and 2036. The higher estimate reflects stronger-than-expected economic growth in Alberta.

The $312.4 billion represents Alberta’s net fiscal contribution (NFC)—the difference between what Albertans pay to Ottawa, primarily through personal and corporate taxes and other federal revenues, and what returns to the province through federal spending and transfers. Projections of Alberta’s future NFC are based on the same methodology used by Statistics Canada and Alberta Treasury Board and Finance (TB&F).

Over the next 12 years, revenues raised by the federal government in Alberta are estimated at $1.16 trillion, including $856.8 billion in federal and provincial taxes. During the same period, federal government expenditures in Alberta, including transfers, are estimated at $844.9 billion.

Albertans have been major net fiscal contributors to Canada for many years. Between 2007 and 2024, a period of 18 years, Albertans paid $293.5 billion more to Ottawa than they received in return, according to Statistics Canada.

Taken together, these figures mean that over the 30 years from 2007-2036, Albertans will contribute an estimated $605.9 billion more to Ottawa than they receive back in federal spending and services.

To be clear, Alberta, like every province, does not directly contribute to federal revenues. Albertans pay the same federal tax rates as other Canadians but contribute more per person because of higher average incomes, a younger population and a strong corporate tax base.

Canada’s federation has always depended on provinces making different fiscal contributions at different times. But when one province consistently generates a disproportionate share of federal revenues over decades, it is reasonable to ask whether the country’s federal-provincial fiscal arrangements continue to reflect today’s economic realities.

These numbers should not be viewed as an argument for separation. I do not support that view. Instead, they should be viewed as evidence that Canada’s federal-provincial fiscal arrangements deserve careful review.

In my view, the Alberta government should use its considerable fiscal strength within Canada to press for a more transparent and accountable approach to federal-provincial fiscal arrangements. That process should begin with a more rigorous review and renewal of major federal transfer programs, followed by the development of meaningful options to reform federal-provincial fiscal arrangements.

Any review should examine not only the Equalization Program but also the Canada Health Transfer (CHT), the Canada Social Transfer (CST) and the Fiscal Stabilization Program. Its objective should be to recommend reforms that improve transparency, reduce complexity, strengthen accountability, encourage economic growth and ensure these programs remain relevant for the future.

I am encouraged that Premier Danielle Smith has also begun calling for reforms to the Equalization Program, which is intended to help provinces with below-average fiscal capacity provide reasonably comparable public services, but the discussion should not stop there.

A more open and co-operative approach to federal-provincial fiscal arrangements would strengthen national unity by ensuring that all provinces are treated equitably within the Canadian federation. As part of that process, I continue to believe the federal government and the provinces should pursue a memorandum of understanding outlining a framework for reform, with Alberta playing a leadership role.

Alberta’s substantial contribution to Canada should not be viewed as a problem to be corrected. It is a strength to be recognized. The challenge is ensuring that the federation’s fiscal arrangements evolve alongside the country’s changing economic realities so they remain fair to all Canadians.

Lennie Kaplan is a former senior manager in the Fiscal and Economic Policy Division of Alberta’s Ministry of Treasury Board and Finance (TB&F), where, among other duties, he worked on cross-ministry committees dealing with energy issues, including participating on the Clean Energy Strategic Advisory Committee (CESAT) and the 2009-2010 Alberta Competitiveness Review.