Recent Changes to Provincial Government Budget Reporting in Alberta

The School of Public Policy Publications, Volume 10:1, February 2018

12 Pages Posted: 26 Feb 2018

See all articles by Ronald D. Kneebone

Ronald D. Kneebone

University of Calgary - The School of Public Policy; University of Calgary - Department of Economics

Margarita Wilkins

University of Calgary - The School of Public Policy

Date Written: February 14, 2018

Abstract

Defining a government by its finances is a tricky business. Adding to the complexity, governments can change the way they report those finances. This is the case in Alberta where, beginning under former premier Jim Prentice, the government switched from presenting its budgets from a fiscal plan (FP) basis to a consolidated financial (CF) basis. The FP approach did not include most of the financial implications of accounting for the Crown-controlled SUCH sector (school boards, universities and colleges, and health entities). CF-based budgeting now integrates these. The result is that the government now reports revenues and expenditures as being considerably larger than they were previously.

This communiqué comes to grips with the changes to accounting methods, by adjusting Alberta’s recent budgets, now reported on a CF basis, and makes those methods consistent with the FP accounting approach, used by governments in Alberta prior to 2015. This involves disentangling entity budgets, reallocating property tax shares, evaluating federal government transfers, and more. The resulting calculations make it possible to more accurately compare and contrast recent budgetary choices with those made over the past four decades.

The accounting changes also have implications for the apparent size of the annual deficit. For example, the provincial government deficit in 2016-2017 is reported as being nearly $1 billion less than is calculated to have been the case had the previous accounting approach been retained.

Suggested Citation

Kneebone, Ron and Wilkins, Margarita, Recent Changes to Provincial Government Budget Reporting in Alberta (February 14, 2018). The School of Public Policy Publications, Volume 10:1, February 2018, Available at SSRN: https://ssrn.com/abstract=3123980

Ron Kneebone (Contact Author)

University of Calgary - The School of Public Policy

Calgary, Alberta
Canada

University of Calgary - Department of Economics ( email )

2500 University Drive, NW
Calgary, Alberta T2N 1N4
Canada

Margarita Wilkins

University of Calgary - The School of Public Policy

Calgary, Alberta
Canada

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