The province's bottom line has taken a serious hit from falling commodity prices and the spin-off effects of the falling economy.
The government's third quarter fiscal update revealed the deficit has grown to $6.3 billion, an increase of $197 million since October. That increase would have been nearly half a billion dollars had it not been offset by a cash injection from the federal government of $251 million.
The province received the federal stabilization funds on Wednesday morning.
While oil revenues fall by $294 million in the last quarter, a major decrease in personal income taxes pose an even greater challenge for the government. Lower earnings and falling employment resulted in a $762 million in lost revenue.
In its last fiscal update, the government pegged employment would grow by 0.5 per cent in 2016, but are now forecasting minus 1.5 per cent.
The fiscal health of the province has also been hurt by falling revenue from the tourism levy due to a lack of business travel, at a cost of $5 million from the last budget.
Increased school enrollment and physician compensation have also driven up the government's operating costs since October.
Meanwhile ministries have maintained or reined in spending nearly across the board, with the exception of health, which funded a $147 million increase from its reserves.
On Tuesday, Finance Minister Joe Ceci said Alberta will seek a further $700 million in infrastructure funding, which Prime Minister Justin Trudeau promised to provide during his visit to Alberta a few weeks ago.
He said the federal stabilization funds the province has already received — which have been funneled into Alberta's general revenue stream — will provide some welcome relief, but won't be enough to counteract the impact of the crash.
The last time the government saw two consecutive years of economic decline was in 1982 and 1983, a time when the national energy program was running and oil prices began to crash to a record low.
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