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It’s no surprise that Stephen Harper chose a privatization hotspot to launch his government’s “Building Canada” infrastructure fund earlier this month. That’s because the push to privatize is the real story behind the Conservative spin.

The P3 Kicking Horse Canyon bridge was the backdrop for Harper and BC Premier Gordon Campbell to announce that British Columbia had signed the first “Building Canada” deal with the federal government. Nova Scotia followed soon after.

While the Conservatives are using sweeping terms like “historic” and “unprecedented” to describe the fund, CUPE economist Toby Sanger’s analysis cuts through the spin to show there’s little new money in the Building Canada plan – but a lot of new ways to push privatization.

Prime Minister Stephen Harper’s claim that Building Canada provides “more funding, over a longer period of time…than any previous federal infrastructure initiative” may be technically correct, thanks to the length of the funding commitment and the consolidation of several programs under one new brand.

But the 2007 federal budget and other announcements have provided little new money, certainly not enough to make a dent of historic proportions in Canada’s infrastructure deficit.

In fact, over time the Conservative plan will mean a declining level of federal support for infrastructure. CUPE’s economic analysis shows Building Canada “is unprecedented not for its increase in funding, but for its drive to privatize public services and for its level of political hyperbole.” CUPE got to the truth behind the bluster in Nova Scotia, and influenced media coverage of the announcement.

One of the fastest-rising components of the federal infrastructure cash is a $1.25 billion P3 fund, which is a massive public subsidy to private sector projects and privatization. Research is clear that this is the wrong policy direction. The Conservatives’ Building Canada infrastructure deal also includes a mandatory P3 review  for any project getting more than $50 million in federal funds.

The Kicking Horse Canyon bridge highlights some of the many problems with P3s that have come to light in British Columbia. A 2006 analysis by the Canadian Centre for Policy Alternatives found that P3s can add years worth of red tape, including “significant delays before a contract is even signed.” The report’s author says the P3 process added three years to the bridge project. 

All the federal and provincial funding for the bridge was in place in March 2003, but it took three full years before a single shovel hit the ground, thanks to P3-related delays. Government officials now say the bridge is ahead of the schedule – but it’s a revised schedule tailored to when construction actually started, not the original 2003 time frame.

CCPA public interest researcher Stuart Murray also concluded the provincial government is “aggressively” pursuing P3s “in spite of a lack of objective evidence that they are a superior option”. The report adds to a growing body of evidence against P3s, finding they are “less cost-effective, timely and transparent than traditional government procurement processes.”

The Harper government has yet to cut the ribbon on a federal office dedicated to promoting privatization through P3s. Details about the unit, which will spend $25 million in public funds over the next five years to promote and evaluate P3s, are expected soon. Again, there’s a lesson to be learned from BC, where the CCPA concluded that the provincial P3 agency Partnerships BC “is unable to adequately protect the public interest due to its inherent conflict of interest.”

Perhaps the most frank illustration of this conflict comes from the head of Partnerships BC himself, Larry Blain. He told a 2003 meeting of BC’s Municipal Finance Authority that “public sector comparators won’t do you much good anyways, because I can make the public sector comparator as bad as we want to, in order to make the private sector look good.”


Watch cupe.ca for more background on federal infrastructure privatization, and updates on actions to oppose P3s across the country.