Alberta budget bill cancels planned benefits for adopted children, changes legal aid funding

The Alberta government is backing away from a program that would have provided dental, optical and other health benefits for adopted children.

"This is basically stopping a program that never started," Finance Minister Nate Horner said of the change at a news conference on Monday.

The move is part of a bill introduced in the legislature on Monday that would enable the government to enact its proposed budget.

Bill 39, The Financial Statutes Amendment Act, would also create a new, lower personal income tax bracket, as the government has promised. If passed, it would also trim some programs to save money, and increase some fees, such as raising the locomotive fuel tax by one cent per litre.

The legislation would apply a new eight per cent income tax rate on the first $60,000 a person earns.

Existing tax brackets would have Albertans pay 10 per cent income tax on the first $148,269 they earn for the 2024 tax year.

The change is expected to save each person up to $750 a year. Bill 39 would also introduce a targeted tax credit to ensure no Albertan loses money as a result of the bracket changes.

With the tax break expected to cost the treasury $1.2 billion in lost revenue, and "whiplash policies coming from our neighbours to the south," Horner said the government is looking closely at programs and services to trim costs. It's necessary to keep Alberta as a low-tax jurisdiction, he said.

Halting the proposed health benefits program for adopted children should save about $3 million a year, according to government officials.

"I know $3 million may not sound like much, but if you want to worry about the dollars, you better take care of the dimes," Horner told reporters.

Sheryl Proulx, executive director of the charitable adoption organization Adoption Options, said a private adoption can cost a family between $10,000 and $15,000.

"It would have been a huge support, as many adoptive children have unique medical and psychological needs," Proulx said.

A benefits program would have been especially helpful for families adopting older children, children with disabilities, and children who have been exposed to alcohol or drugs in utero, who may require lifelong help.

Eliminating the program before it begins could prevent some families from adopting children with more complex needs, she said.

"Adoption services to me is not just an expense," Proulx said. "It's an investment in ensuring a stable, loving forever home with improved long-term outcomes for children and reduced future social costs related to child welfare and foster care."

The agency currently has 78 registered families hoping to adopt a child through private arrangements with birth parents, she said.

The provincial government said there are 48 children in care awaiting adoption.

Legal aid funding changes

Bill 39 would also prompt the government to rely more heavily on the Alberta Law Foundation for legal aid funding.

The foundation receives interest revenue from Alberta lawyers' pooled trust accounts, where client funds are held.

Since 1991, a quarter of that interest has gone to fund legal aid, which provides some representation to people who cannot afford a lawyer.

Should Bill 39 pass, the foundation would have to dedicate 50 per cent of its funding to legal aid. The government plans to reduce its legal aid funding contribution by $22 million this year to $88 million, according to budget documents.

Foundation executive director Byron Chan says he's disappointed by the proposal, because the fund, which started in 1973, was never intended for this use.

The foundation has no control over the size of the fund, or interest rates, meaning the interest available can vary substantially from year to year, he said.

This could destabilize funding for legal aid, and put at risk grants the foundation also gives to legal clinics, violence prevention services, and other organizations, he said.

The bill would also require the minister of justice to approve any foundation gifts or awards worth more than $250,000. Chan says that could call into question the independence of the organization.

"It risks politicizing a granting process that has always been apolitical," Chan said.

Chan says he doesn't know of another provincial law foundation subject to these rules.

Justice Minister Mickey Amery said at a news conference it is an attempt to align foundation oversight with that of other provincial organizations.

"We thought that this was a good way of making sure that legal aid would be sustainable for the long term," Amery said.