Smith announces new Crown corporation to oversee Alberta’s rainy day fund

Alberta Premier Danielle Smith announced a new Crown corporation Wednesday to oversee the province’s rainy day fund.

The Heritage Fund Opportunities Corp. is to direct policy for the Heritage Fund, which for the most part will still be managed by the Alberta Investment Management Corp., or AIMCo.

The new Crown corporation is also mandated to independently manage the investment of new deposits.

Smith said she aims to grow the fund to at least $250 billion by 2050 in order to wean the province off the resource revenue roller-coaster.

“No matter how far into the future, there will come a time that we may be unable to rely on those revenues, and we cannot hide from that reality now,” the premier said in Calgary.

The fund’s assets were valued at $23.4 billion as of September, and the government pledged another $2 billion that is now earmarked for the new corporation’s investments.

Finance Minister Nate Horner said its board can invest that seed funding in a different way than AIMCo, the province’s public pension fund manager.

“That’s beyond AIMCo’s mandate, more in a sovereign wealth (fund) style,” said Horner.

The new Crown corporation will operate at an arm’s length and publicly report results, Smith said.

Horner told The Canadian Press in an earlier interview the goal is not to “de-risk” pet projects that have difficulty getting financing, as Smith has previously mused.

“This will be return-focused,” he said.

The finance minister said the new corporation will create global investment opportunities that wouldn’t have been offered to a manager like AIMCo.

When asked Wednesday whether the new corporation’s goal to support “areas that matter to Albertans” means investing in more Alberta-based assets, Horner said “not necessarily.”

“It’s about leveraging opportunities where those partnerships could provide great opportunity for the province down the road, but that isn’t necessarily the goal,” he said, pointing to the province’s advantages, like its knowledge base in artificial intelligence and water infrastructure.

He said the plan represents a return to the original vision of the heritage fund.

It was created in 1976 by former premier Peter Lougheed to set aside a portion of resource revenues, but subsequent governments have dipped into the piggy bank as needed, particularly when the price of oil crashed.

The Heritage Fund Opportunities Corp. will be chaired by Lougheed’s son Joe, board chair of Calgary Economic Development and a partner at Dentons law firm in Calgary.

Smith’s United Conservative Party government has committed to not skimming interest earnings from the fund to prop up the province’s general revenue.

It estimates that if all the Heritage Fund’s income had been reinvested from the start, it would be worth upwards of $250 million today, generating more than $20 billion annually.

Opposition NDP finance critic Court Ellingson told reporters in Calgary he supports the government’s efforts to grow the long-neglected savings fund, but the province already has a body in place to do that work.

“We didn’t need a new corporation,” he said.

Wednesday’s announcement comes after Horner sacked the chief executive officer and entire board of directors of AIMCo in November.

Less than two weeks later, the province hired former prime minister Stephen Harper as the new chairman of AIMCo.

In addition to the Heritage Fund, AIMCo also handles about $118 billion in investments for public sector pension plans representing thousands of Albertans, including teachers, police officers and municipal workers.

This report by The Canadian Press was first published Jan. 29, 2025.

Lisa Johnson, The Canadian Press