In the months ahead, the federal government will chart a course for Canada’s economic recovery, while also dealing with the ongoing pandemic. CUPE is calling on the federal government to keep privatization out of the country’s pandemic recovery plans. Investing in public programs and services is the fastest, most cost-effective and reliable way to boost the economy and support us all through tough times.
A newly-released CUPE backgrounder sums up the evidence that fully public infrastructure projects provide the most benefit to workers, communities and the economy.
The Liberal government has said the Canada Infrastructure Bank (CIB), which allows corporations to profit from privatized infrastructure, will play a major role in economic stimulus plans. This is a risky move that takes our country in the wrong direction.
The costs of privatization
Most CIB projects are expected to be developed as long-term privatization deals known as public-private partnerships (P3s). The CIB is mandated to use $35 billion in public funds over 11 years to leverage the private financing, ownership and operation of revenue-generating green infrastructure projects like renewable power and water and wastewater systems, as well as public transit, roads and bridges, and broadband projects.
Developing infrastructure projects as P3s won’t provide much-needed economic stimulus. Instead, P3s will lock governments into long-term contracts with corporations that can double infrastructure project costs over 30 years. These decades-long privatization deals are expensive, risky and unaccountable.
A public recovery
The federal government needs to ensure infrastructure stimulus spending gets out the door quickly, addresses shortcomings identified by the COVID-19 pandemic, and positions Canada for the future. Privatization does not meet any of these tests. A public recovery led by the federal government must:
- Invest in public projects by providing grants or low-cost public financing for infrastructure projects.
- Streamline investments to ensure needed infrastructure spending gets out the door, while ensuring safeguards are in place to ensure communities and equity-seeking groups benefit.
- Prioritize green investments that are publicly owned and operated, such as renewable energy.
- Increase the federal share of project costs to reflect the fact that provinces, territories and municipalities are under extreme financial pressure.
- Prioritize social infrastructure in areas such as child care, long-term care and social housing where a predominantly female workforce has been disproportionately affected by the COVID-19 crisis.