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A University of Calgary School of Public Policy report claims to prove Alberta independence would decimate wages and living standards.

The report models possible outcomes using contestable assumptions, including that an independent Alberta would replicate Ottawa’s costly approach to government.

Opponents of Alberta independence are presenting a new School of Public Policy report as definitive proof that leaving Canada would devastate the provincial economy.

The "Alberta Federation of Labour" claims the report shows wages could fall by between $5,000 and $12,000 annually while Alberta’s debt could reach $442 billion.

But Dennis Kalma of the Alberta Prosperity Project says the report’s own contents are considerably less catastrophic than those headlines suggest.

Kalma points out that the report’s long-term scenario leaves an independent Alberta economically better off than Alberta is today. Its negative figures compare Alberta with a hypothetical future in which the province remains in Canada and the economy grows differently. They do not necessarily predict that Alberta’s economy would shrink from its current size.

Growing more slowly than an optimistic baseline is not the same thing as becoming poorer than today.

The report also acknowledges Alberta currently sends approximately $14 billion more to Ottawa annually than it receives in federal spending. That net outflow represents money which could remain under Alberta’s control following independence.

The study’s estimate of the cost of replacing federal programs is also built on a debatable assumption. According to Kalma, it calculates Alberta’s future expenses by assigning the province a proportionate share of what Ottawa currently spends.

The result is an estimate that Alberta would require approximately 76,000 workers to perform responsibilities the federal government currently administers in the province with about 18,880 employees.

In other words, the model assumes a new Alberta government would need roughly four times as many workers because its cost estimate is derived from the federal government’s much larger bureaucracy.

An independent Alberta would determine the size and structure of its own government. It could consolidate departments, avoid duplicating existing provincial agencies and deliver services differently. It would not be legally or practically required to recreate Ottawa’s bureaucracy in miniature.

Economic modelling can help identify risks, but a model cannot predict political negotiations, future trade arrangements, government efficiency, energy policy or the choices voters and governments would eventually make.

The report offers scenarios based on assumptions. It does not prove that independence would produce one inevitable economic result.

Its projections should be debated during the referendum campaign, along with competing estimates. Treating its most pessimistic scenario as established fact conceals how heavily that result depends on the authors’ chosen assumptions.

A forecast built around an Ottawa-sized public sector tells Albertans what could happen if independence were badly managed. It does not establish what independence itself would cost.