On February 27, 2025, Alberta’s Finance Minister presented the 2025 Budget. This memo highlights key updates relevant to plan administrators, employers, and members.

Click here to download the article in PDF format:

Notes on the Alberta Budget (PDF)

Healthcare

The Budget includes a $28 billion allocation to healthcare in operating expenses, representing a 5.4% increase. This includes $22.1 billion to improve access to health services close to home, build capacity in hospitals and rural facilities, expand surgical options, and retain health professionals. An additional $644 million is dedicated to primary care, while $4.6 billion will support acute care services in hospitals and other health facilities. Indigenous health initiatives will receive $45 million over three years to address health inequities and promote wellness. $7 billion is earmarked for physician compensation and development, while $1.9 billion will support drugs and supplemental health benefits, including the seniors’ drug program. An additional $3.6 billion will be invested in health infrastructure, including $5 million for a cardiac catheterization lab and $22 million for renal dialysis expansion at Chinook Regional Hospital.

Mental Health

The Budget allocates $1.7 billion to expand addiction and mental health services and $3.8 billion to establish Assisted Living Alberta, a new provincial agency focused on continuing care and home support.

Enhanced Benefits Coverage for Adopted Children

The government announced that it will no longer be moving forward with the proposed health benefits program for adopted children. The program would have provided dental, vision and other supplemental health benefits for adopted children.

Alberta Child and Family Benefit

The Budget plans for an additional $29 million towards Alberta Child and Family Benefit (ACFB), considering population growth, a 2% benefit increase, and increased phase-out income thresholds. The ACFB provides direct financial assistance to lower and middle-income families with children under 18.

Disability Programs

Budget 2025 includes $1.64 billion in 2025-2026 for the Assured Income for the Severely Handicapped (AISH) program — a $49 million decrease from the previous year. This will not affect the amount of monthly income support received.

In February, Alberta’s Seniors, Community and Social Services Minister announced a new disability program on top of AISH called the Alberta Disability Assistance Program (ADAP) set to launch in 2026. The program is designed to allow those with disabilities to pursue job opportunities while continuing to receive financial, medical and personal supports.

Alberta Senior Benefits

Funding for Alberta Seniors Benefits increases by $33 million in 2025-26, to $540 million, and reaches $619 million by 2027-28, due to senior population growth and annual rate increases. The Alberta Senior Benefits provides financial assistance to eligible low-income seniors.

K-12 Education

Budget 2025 allocates $9.9 billion in operating expenses for K-12 education, reflecting a 4.5% increase tied to enrolment growth. This funding includes$1.1 billion to hire over 4,000 new teachers and classroom support staff. An additional $1.6 billion will support students with specialized learning needs.  $55 million is allocated to support additional staff like teachers, counselors, psychologists, and interpreters, aiming to address the needs of complex classrooms.  $2.6 billion will be invested in educational infrastructure over the next three years.

Personal Income Tax

The government is introducing an 8% personal income tax bracket for income up to $60,000 2 years ahead of schedule, effective January 1, 2025. This initiative is expected to save Albertans up to $750 per individual, or $1500 per household, in 2025. Personal income taxes for Albertans earning less than $60,000 will fall by 20%.

Property Tax

Budget 2025 is increasing the education property tax from $2.56 to $2.72 per $1,000 of equalized assessment for residential and farmland properties, and from $3.76 to $4.00 per $1,000 for non-residential properties.

Locomotive Fuel Tax

Effective March 1, 2025, the fuel tax rate will increase from 5.5 to 6.5 cents per litre.