The Québec auditor general’s report that was released today strongly repudiates the entire process that led the Charest government to choose public private partnerships (P3s) to build Montreal’s two “super hospitals”, says the Canadian Union of Public Employees (CUPE). “We’ve been speaking out against the P3 trap and its false economies for years,” states CUPE Quebec president Lucie Levasseur. “Today an independent report has confirmed that P3s were made to look better by doctoring the figures.”
According to the auditor general, “analyses of the added value by PPP Québec do not make it possible to support the conclusion that their completion using the PPP delivery method is preferable to carrying out the work under the conventional method.” According to the auditor general, there were many deviations from the norm and the entire process was skewed in favor of the P3 option. He reported, for example, the absence of any real analysis of the impact on the final result of variations in the amount of risk. As concerns the evaluation of the asset maintenance and renewal costs and deficit, he talks about inappropriate assumptions that “greatly accentuate the variance in favor of the P3 method” and even “unrealistic” analyses. He also notes that the discount rate (used to convert to today’s dollars the cash flows associated with the two options) was set at a higher level than for other P3 projects, without any justification.
For CUPE, the absence of a critical and independent assessment of Québec’s P3’s analysis is proof of the Charest government’s ideological bias. “There was a deliberate effort to present a sugar-coated P3 project,” declared Michel Poirier, Quebec Director of CUPE. “The conclusion was decided in advance and “PPP Québec” wrote the playbook. It is a shame since taxpayers will now have to foot the bill, unless the government makes a rational decision and opts for conventional methods.” Canada’s largest union points to overspending on many P3 projects in other provinces and insists on the need for public services to be provided by the public sector. “P3s have never proven to be more advantageous. The public sector must not abdicate its responsibilities but rather make every effort to provide quality services at an affordable cost,” concluded Lucie Levasseur.