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The Federation of Canadian Municipalities has released a research report which asks many questions of those pushing public-private partnerships.

Public-Private Partnerships and Municipalities: Beyond Principles, a Brief Overview of Practices, by Université de Montréal professor Pierre J. Hamel stops short of telling municipalities not to use public-private partnerships, but reaches some suggestive conclusions:

  • There is no evidence to suggest that P3s consistently cost less or provide better services than traditional public projects.
  • P3s do not offer municipalities a magic solution to the problem of securing additional funds for infrastructure. Only significant, sustained public investment will meet our infrastructure needs.
  • P3s give the responsibility for financing projects to the private sector, even though traditional municipal financing is simple, relatively easy, and less costly than private-sector financing.
  • P3s are normally used for the construction of new projects, which tend to be more attractive to potential private-sector investors. As a result, they do little to solve the more pressing problem of funding repairs and maintenance of existing infrastructure.

Hamel’s report also notes that municipalities that rely on P3s can lose the ability to ever go back, and that use of P3s can render a municipal government less flexible, less transparent and less accountable.