What Does Alberta's Oil Wealth Pay For? Not Education - Alberta Is Dead Last In Per-Pupil Spending Among Provinces [View all]

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Some kids like math, but the math on Alberta’s oil-dependent finances is definitely not fun. Smith’s single-minded fixation on the oil and gas industry has left the province dangerously dependent on highly cyclical oil revenue. A yawning chasm between UCP oil enthusiasm and what is happening in the real world may soon devastate Alberta’s ability to provide basic services like education and health. Despite Smith’s constant cheerleading for additional bitumen extraction, an eye-popping global oil glut of up to 4 million barrels per day in excess supply is projected for the coming year. Some of this is part of normal price volatility, but a growing portion of the global surplus is due to the structural decline in oil demand due to rapid electrification in China and the developing world.

A fiscal plan tabled by Alberta in February details the disconnect between Smith’s pro-oil hype and the ton-of-bricks reality soon to be crashing through her optimistic assumptions. Smith’s government projected the average price of West Texas Intermediate (WTI) crude for the current fiscal year to be $68 per barrel, rising to $71 for the budget tabled next spring and $71.50 for 2027. Last week WTI was below $57 and recent projections from the U.S. government expect crude to plunge to an average $48.50 in 2026. Similar grim projections show little improvement for 2027. Every dollar drop in the price of WTI crude puts a $750 million hole in the provincial budget. A rough calculation shows that Alberta may face a staggering budget shortfall of over $16 billion in 2026 and another $16 billion in 2027 based on current price projections. This is on top of a $6.5 billion updated deficit for the current year.

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A recent report from the right-leaning Fraser Institute documented how Alberta education spending per student is the lowest in the country. But isn’t that because Alberta has a growing population and needs to build more schools? Nope. The Fraser report also looked at per student spending minus capital costs. Alberta is still last; 28 percent below what New Brunswick spends per kid on education. But what about long-term policy choices? The Fraser report helpfully looked at the scenario where “the inflation-adjusted, per-student spending levels [had] been maintained from the 2012/13 base year.” Almost all provinces chose to substantially increase spending per student in the last decade, with a 10 percent average increase nationally. Alberta was again dead last, showing a decline by over 15 percent since 2013.

Is that what prosperity looks like? Alberta bitumen production increased over 90 percent since 2013 while automation eliminated over 25,000 oil and gas sector jobs between 2014 and 2021. Those job losses are projected to accelerate, wiping out about 30 percent of the remaining oil patch workforce by 2040. And if oil prices plunge to levels seen during the COVID-19 pandemic, expect companies to curtail production as they did during the pandemic, no matter how many pipelines Smith would like to imagine.

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https://www.desmog.com/2025/10/29/what-is-albertas-oil-wealth-paying-for-not-better-education/