Almost $400 billion of transitional costs, plus somewhere in the neighbourhood of $25 billion to $50 billion in annual costs.
That was Alberta Premier Danielle Smith’s early estimate of the price tag facing her province should it separate from Canada.
“I think it’s responsible for us to be very forthright about the cost associated with what is being proposed, so people can make an informed decision,” Smith said Monday.
Contained within the estimate? What Smith called a long “laundry list” that runs the gamut from Alberta’s share of the national debt — about $170 billion, with about $10 billion a year in interest, in her estimation — to costs tied to border control, tariffs and NATO.
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A full costing document has been promised, potentially to be delivered by August, and is currently being prepared by Finance Minister Jason Nixon.
“We have to take some time with it,” Smith said. “We want it out in time for people to have enough time to digest it before the vote.
“But there are significant startup costs.”
That estimate is “insane” in the eyes of Jeffrey Rath, the chief lawyer for Stay Free Alberta.
“It’s just trying to terrify Albertans into not wanting to leave,” Rath said.
The Alberta Prosperity Project, the group behind Stay Free Alberta, released its own costed fiscal plan in July 2025, which it calls the Value of Freedom.
The document looks at the cost of setting up armed forces, immigration and deportation systems, a postal service, airports, policing and national parks, among other necessities.
The transition number it came up with was approximately $6 billion, Rath said.
“If this is the best argument that the federalist Dani Smith can come up with, she better get back to the drawing board, because it’s not an argument at all,” he said.
On Oct. 19, Albertans will head to the polls to vote on a number of referendum questions. Among them, whether Alberta should remain a province of Canada or whether the provincial government should begin the process to hold a referendum on separation.
In discussing the government’s forthcoming document, Smith mentioned that she thought University of Calgary economist Trevor Tombe had already done some “back-of-the-envelope” calculations.
Tombe told CBC News he hasn’t done work on setup costs to date. Tombe is part of the federalist group Lead Not Leave.
His research from July 2025 had suggested higher trade barriers following separation could reduce Alberta’s economy by about six per cent or roughly $30 billion per year in overall income generated.
He also pointed to the United Kingdom’s experience following Brexit, where investment levels remain significantly below where they otherwise would have been.
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“Brexit was significantly easier than what Alberta leaving Canada would entail,” Tombe said.
“And so any of the costs around what the United Kingdom has experienced should be viewed as a substantial underestimate of the potential costs and challenges that Alberta would face leaving Confederation.”
Interestingly, the British government’s estimate of the cost of leaving Europe — pegged at roughly £4,300-a-year per family by 2030 — was one of the most contentious and scrutinized elements of the heated Brexit debate in 2016.
No doubt Canadians will be watching closely to see what number Nixon calculates for the cost of Alberta separation later this summer.
A British economist, meanwhile, told CBC News that Alberta’s separation discussions remind him of Scotland’s 2014 failed referendum seeking independence from the United Kingdom.
“The focus was much more on these costs … of actually separating and that seems to me a much more direct analogy with what you’re talking about in Alberta,” said Jonathan Portes, professor of economics and public policy at King’s College London and a senior fellow at the UK in a Changing Europe think tank.
“Although you probably ought to be talking about the potential trade costs as well.”
Portes noted that unlike Brexit, the secession vote in Scotland lost and thus economists were not able to observe its real-world effects.
But analyses suggested that the process would have been difficult, especially when it came to dividing responsibilities for taxes, pensions and other benefits, he said.
“There are areas where either side could reasonably argue different positions on the allocation of cost of benefits,” Portes said.
“And hence, since it’s not simple or obvious, you’re setting yourself up for some long and complicated and possibly quite bitter arguments.”
Nixon, Alberta’s newly appointed finance minister, has said he’ll turn to outside experts to help inform the provincial government’s report on the costs of leaving Canada.
Lennie Kaplan, a former Alberta Finance official, has some experience in such matters. He was the executive director of the MacKinnon Report on Alberta’s Finances in 2019.
On Wednesday, he drew up some recommendations on how a panel focused on measuring the economic and fiscal impacts of Alberta independence could function.
“By using an expert panel, I think you maybe defuse some of the conflict,” Kaplan said.
“Having it outside the scope of government by having government staff available to provide assistance, to run shock analysis or answer questions, provide data, et cetera, I think that’s a useful template. And that’s what we used with the MacKinnon Panel.”
That panel should consist of independent and impartial experts tasked with contrasting the government and the separatist estimates, he said.
It should assess national debt and assets, setting up new federal-style institutions like a tax agency and a central bank, he said, replacing major social programs and pensions, and modelling the economic impact of potential trade barriers.
All told, it should provide Albertans with a comprehensive study, Kaplan said.
“Albertans can judge for themselves whether moving toward some sort of independent state or remaining within Canada under some maybe different fiscal arrangements would be a better alternative,” Kaplan said.
Rath, meanwhile, isn’t convinced about the merits of Smith’s efforts to engage Nixon on the file.
“[They will] come up with more silly numbers to try to scare Albertans into not wanting to leave Canada. You know, I think it just further undermines her credibility,” Rath said.
