Newly-revealed court documents show the Ontario Liberal government went ahead with the province’s first privatized hospital, despite knowing the P3 hospital scheme would cost up to $300 million more than a publicly financed and administered facility.
A coalition of health care unions, including CUPE, joined the Ontario Health Coalition in a lengthy court battle to disclose the financial arrangements for Brampton’s William Osler Health Centre.
Lewis Auerbach, a former director with the office of the Auditor General of Canada, said the P3 arrangement for Brampton’s hospital may be “much poorer value for money than a comparable project done in the traditional public non-profit way.” Auerbach estimates that the comparable cost of a public hospital was overestimated by at least $300 million – possibly up to $400 million – to make the P3 project look viable.
“So far, the Brampton P3 has had cost increases, space decreases, flexibility decreases – and all of this with little transparency in the various early stages of the project. Indeed, the Brampton P3 hospital may not only cost more, it may also end up providing a lower level of service – a risk that will increase in the latter stages of this 25-year project”, said Auerbach.
The ongoing cost increases are hitting the community. In late May, the Osler hospital’s CEO priced the P3 at $900 million – $350 to $450 million more than the last estimate (which in turn was more than earlier estimates). The community, which must foot part of the new hospital bill, has seen its share of the bill double to about $270 million.
If residents can’t fundraise that amount, they may find themselves paying higher taxes to fund the overpriced P3. Earlier this month, St. Catharines city council committed $31.2 million to help pay for a new P3 hospital. Council has brought in a separate tax levy for about $42.65 per household, beginning in 2008 and ending in 2037.
The Brampton and Royal Ottawa Hospital projects were negotiated by the previous Conservative government. The Liberals appeared to oppose P3 hospitals during the 2003 election campaign, but approved the two projects – along with dozens more – once elected.
The president of CUPE’s Ontario Council of Hospital Unions (CUPE/OCHU) called for an immediate moratorium until the province’s auditor has reviewed the situation. Michael Hurley also called the provincial Liberals to account for their actions, given the government had an independent consultant’s report showing the $300 million difference for 13 months before going ahead and signing the deal.
The coalition is also calling for full disclosure of all other secret P3 hospital deals it has signed. Together with the Ontario Health Coalition, CUPE/OCHU continues to fight for 100 per cent public hospitals and will continue its campaign of community plebiscites in June.
Visit www.ontariohealthcoalition.ca for more background.
With files from the Brampton Guardian