Last year, the union for the Centre hospitalier universitaire de Québec (CHUQ) employees denounced the skyrocketing costs of the proposed public-private partnership (P3) renovation of the Hôtel-Dieu de Québec. The union’s figures have never been refuted.
Armed with even stronger arguments in the wake of the Quebec Auditor General’s report released on June 9, CUPE took up the torch and denounced the choice of a P3 for the Hôtel-Dieu de Québec (CHUQ) expansion project. For the union that represents the majority of CHUQ employees, it has become apparent that the current proposal will be more costly for taxpayers and is far too risky for the province of Quebec.
The most recent monitoring report of Quebec’s Auditor General once again criticizes the added value analyses that have unduly favoured the P3. “We continue to be of the opinion that the value-added analyses of the P3 revised by Infrastructure Québec (IQ) for the MUHC and CRCHUM projects still do not allow us to conclude that the P3 delivery method is more economical than having the public sector carry out the projects using the conventional method.” The auditor’s report points out two inaccuracies in the value-added analyses for these projects: the markedly exaggerated depreciation index and the discount rate.
On this last point, CUPE is stunned by the auditor’s revelation that, “The information sent to decision-makers who have selected the P3 delivery method indicates that a simulation of the results with a discount rate of 6.5 per cent and with no asset maintenance and renewal deficit was carried out. But this simulation was never performed. In reality, if such a simulation had been carried out, the effect of these two assumptions on the results of the value analysis would have considerably increased the $10.4 million advantage offered by the conventional method in comparison with the P3 method.”
Raynald Blouin, president of the CHUQ union (CUPE 1108), finds this very disturbing. “We learned today that the P3 agency deliberately lied about the Montreal projects in order to deceive the public. It is a serious matter to make statements supposedly based on calculations that were never carried out. This just goes to show the blind faith of the P3 supporters.”
Blouin hopes that the Charest government will step up to the plate by abandoning the P3 approach to the hospital centres and renew its faith in the public method.
Finally, CUPE notes that these “inaccuracies,” to borrow the auditor’s term, or “omissions” regarding the simulations, are common in P3 cases. The ‘value for money’ justification of PFI projects in the United Kingdom, for example, presented similar irregularities to foster partnerships with private companies. Finally, Professor Pierre J. Hamel’s recent research on P3s in hospitals has also identified the many problems inherent in these analyses.