Alberta Heritage Savings Trust Fund

An Alberta Heritage Savings Trust Fund is a provincial fund established in the Canadian province of Alberta which aims to manage and invest the savings from Alberta's vast non-renewable resources to provide the greatest financial return on those savings for current and future generations of Albertans. The Alberta Heritage Fund was enacted under the Alberta Heritage Savings Trust Fund Act of 1976. The fund invests in equities, bonds, real estate, private equities and absolute return strategies. It acts as a sort of long-term savings fund. No other province in Canada has such a fund, so it is unique completely to Alberta. The Heritage Savings Trust Fund operates under the Alberta Heritage Savings Trust Fund Act. It was started during a time period when the people and government of Alberta feared that the natural resources and wells of the province were going dry.

At inception in 1976, the Alberta Heritage Savings Trst Fund had three objectives: to save for the future, to strengthen or diversify the economy, and to improve the quality of life of Albertans. When it was originally established, it was meant to collect a portion of the province’s non-renewable resource profits to invest into projects for the future. In 1997, the Heritage Fund was restructured so that it could no longer be used by the government for direct economic development or social investment purposes.

Today, the Fund is invested by the Alberta Investment Management Corporation in a globally diversified portfolio across many assets classes, such as stocks, bonds, and real estate. However, the funds and the revenue produced by the income still support governmental programs that the citizens of Alberta use, including health care, education, and infrastructure.

The Alberta Heritage Savings Trust Fund releases quarterly updates that detail its earnings, rate of return, and top financial priorities for revenues. For example, over the first nine months of the 2017-18 fiscal year, the Heritage Fund earned a 7.1 percent return and $1.4 billion in net income. As of December 31, 2017, the fund’s assets were worth $17.5 billion on a fair value basis. With statistics that are current as of May 2018, the Heritage fund earned 11.1 percent average annual rate of return for the preceding five years and since its inception in 1976, has contributed an impressive $42.8 billion to fund priorities such as health care and education.