The Implications of an Aging Population for Government Finances in Alberta
— Publié le 30, November, 2021
- Seniors currently compose 13.8 percent of Alberta’s population, and their share of the province’s population will continue to grow and reach 19.0 percent by 2043.
- This will drive increases in health care spending and slow growth in revenues, while imposing adverse effects on the provincial economy. The risk of future recessions, rising interest rates, and other unexpected events would only compound problems further.
- Health care expenditures are estimated to increase by approximately 5.6 percent annually from now until 2040/41. Put differently, Alberta’s health care spending will increase from 6.3 percent of GDP in 2019 to 7.0 percent in 2040.
- The aging population will exacerbate challenges for Alberta government finances and projections suggest the province will not see a balanced budget before 2040 at the current trajectory.
- Alberta is expected to run primary deficits (excluding interest costs) equivalent to between 1.0 and 2.0 percent of GDP, absent a change in spending or tax policy.