Provincial finance minister Rod Gantefoer needs to do his homework on “public-private partnerships” (P3s) before he commits the province to these controversial infrastructure schemes that could cost Saskatchewan taxpayers for decades, says Tom Graham, President of CUPE Saskatchewan.
Graham is not only offering the minister that advice, he has emailed him a list of suggested reading, including internet links to three Canadian reports on P3s that cast a long shadow over their feasibility.
Minister Gantefoer told a Saskatoon business luncheon earlier this week that he was “open” to the idea of public-private partnerships to assist with large-scale infrastructure projects. He also said the SaskParty intends to seek advice from various companies across the country.
The federal Conservative government, a staunch proponent of P3s, now requires all provinces, territories and municipalities to consider P3 infrastructure options as a condition of federal funding.
Dubbed “Partnerships for Public Pickpockets” by their detractors, one of the key features of P3s is they turn the operation of public facilities over to private interests under multi-year contracts.
The Canadian experience with P3s has not been positive.
One of the best known P3 projects, PEI’s Confederation Bridge, cost $45 million more than it would have if it had been built publicly, according to Canada’s Auditor General.
Similarly, a Brampton hospital built under a P3 scheme cost the Ontario government up to $300 million more than if had been built using traditional public financing.
According to a 2007 report prepared for the Federation of Canadian Municipalities by Quebec academic Pierre Hamel, there is no evidence to suggest that P3s consistently cost less or provide better services than traditional public projects. The report, Public-Private Partnerships and Municipalities: Beyond Principles, a Brief Overview of Practices, is one of CUPE’s picks for the minister.
Another is a 2006 working paper by the University of British Columbia, Public Private Partnerships in Canada: Theory and Evidence, which examines 10 Canadian P3 case studies and concludes: “the potential benefits of P3s are often outweighed by high contracting costs and opportunism.”
The third is a 2006 report by the Canadian Centre for Policy Alternatives, Value for Money? Cautionary Lessons About P3s from British Columbia by Stuart Murray, which finds P3s are less cost-effective, timely and transparent than traditional public projects.
CUPE hopes the minister does his homework and reads these detailed reports before proceeding any further down the P3 road, adding it would be irresponsible not to.
“With so much research demonstrating the financial perils of these projects, it is hard to imagine how any government could justify pursuing these schemes,” says Graham, adding blind ideology is not a sufficient reason.
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