P3s: Public-Private Partnerships
Bruce Holland explains how municipalities can solve infrastructure challenges wherein [P3s] will reduce the burden on local taxpayers while leveraging a greater number of projects. This may be something that Moncton and Saint John city councillors could look into more seriously (as a longterm strategy) instead of always getting on their hands and knees with those on the dole in Ottawa and Fredericton.
16 Comments:
The article makes for an interesting read, as it focuses on the infrastructure problems that we will be facing in the 2010s and 2020s. Moncton, for example, has wooden water mains from the 1890s downtown. We're living on infrastructure that was mostly built during the post-war years. Most of these projects have 25 to 50 year lifespans, and those bills are coming due.
The only thing that we need to watch with P3s is proper public scrutiny of the construction process. Contractors are very good at getting things done on time, and under budget. To achieve these two goals, shortcuts are sometimes taken. Perhaps a pipe with a smaller wall thickness is installed. Maybe the asphalt isn't as thick as it should be. The Crown cannot absolve itself of its responsibilities when it outsources to the private sector.
NB has dropped the ball on P3s so far. We've already ripped up a major contract for political reasons, and we'll be paying penalty clauses for the foreseeable future. I don't necessarily trust our future in these endeavors.
I agree with the above poster. Although, just like the article says, there are those who oppose it on the basis of self interest even though Canadians agree the private sector should play a larger role:
Environics and Research Group shows that 64 per cent of Canadians agree that “It’s time to allow the private sector to deliver these types of services
in partnerships with governments.” Yet unions and municipalities remain largely opposed. This position is not in line with voter
interests. Perhaps it is all about self-interest.
I see the interest groups are lining up already against the use of P3s by our premier. Not surprising since they were against free trade, Atlantica and a slew of other great initiatives.
Good comments you two. I think interest groups opposed to P3's should remember the other side of the arguement, in that, few taxpayers in New Brunswick believe that governments are efficient or good money managers (circa Caisse). Not to mention, recent debacles like the sponsorship scandal, HRDC, the two billion dollar gun registry or NB’s overuse of corporate welfare to declining industries are expensive reminders of government incompetence and mismanagement.
It's time to let business get involved in mega projects since bureaucrats obviously have demonstrated that they can't look past petty politics when it comes to ED and our hard-earned money.
Socialists hate P3, it allows the private sector to profit from the provision of social infrastructure. It also puts the lie to their continual claims that anything that benefits society HAS to be provided by the state because no one else will do it.
When they were elected the first time, the Liberals in Ontario canceled a P3 project that would have built and run a state of the art hospital in Ottawa.
I wonder how many lives and how much suffering that little piece of socialism cost.
Excellent post!! I'm a Winnipeg resident and we have seen good examples where this has worked in our region. Take the police station as an example:
Katz proposes 'P3' funding
Not only do I applaud the Mayor for finding alternative funding structures for large capital projects, but for keeping his commitment to local taxpayers.
speaking of p3s:
http://telegraphjournal.canadaeast.com/front/article/152885
It also puts the lie to their continual claims that anything that benefits society HAS to be provided by the state because no one else will do it.
I don`t agree that the state needs to provide it, but with a true cost benefit analysis, compared to all the graft your typical capitalist tacks onto a project, the state can do a fairly good job.
How many Canadians not in an upper tax bracket do you think would like to repeal our socialized medicare system? Do you think the nurses spend their money differently whether they get it from the province or a private clinic? You`ll have to pardon me if I don`t weep for lost BMW sales to doctors.
Although it might be true that full-out socialism demands a level of cooperation outside our capacity, it seems sad that this would always be the case. It certainly will be as long as we`d rather pay illegals to grow our food and slaves to make our clothing while the kids fry themselves out on Xbox and prozac.
Somehow we got to a point where we`d suddenly let our leaders send the soldiers off for oil, we`d sit there high while millions get locked up for drugs, we`d even let the government fund Nicaraguan rebels through crack sales, while our cops learn to taser mental patients (have you seen the SSRI prescription rates).
If you believe that humans have the potential for good, you`ll join me in praying that these times someday end.
Perhaps once people start finding out how bad the banks have screwed them. The spin doctors and cheerleaders are trying their best, but the fundamentals will really test our collective credulity that uncle Sam and dick Cheney`s crew know what to do.
If enough people simply start talking about how little the money is really worth, how it was created and needs continuous exponentially growth to support the associated (stupefyingly enormous) total debt.
Unfortunately, it`s going to be an unfair fight - the same fight Christ was glorified for attempting - the globalists have the best military in the world, all the oil land and power, most of the weapons and hold all of the debt.
The people have controls over themselves and what they`re willing to do (i.e. accept worthless paper currency).
It`s a battle we can win, but not without help. Just think about it - if we still have a say in things - will it be private nurses, soldiers, lawyers and highways or take away the piggy bank from our capitalist monarchy?
Ummm...Mike Murphy coming through on a verbal promise??? No chance.
Try to stay on topic folks!!!
That WAS the topic NBT, you just don't like it said. I'll add to it though, a 'poll' is not 'proof' of anything. Canadians have been saying in successive polls since the mid nineties that they want government to properly fund public expenditures. It's tough to do that though when you cut billions in taxes for the very rich and corporations pay almost nothing.
Of course I'll again mention that 'state run' is NOT socialism. If it were, the US would be far more socialist than Canada as there public medicare system is far larger than Canada's. State run medicine is simply state run medicine, NOT socialism unless you have the most bizarre definition of socialism which every person in the world who calls themselves socialist would disagree with.
Now, IF the public had some kind of say in their medical system that would be a different story, but thats never been the case. The healthcare system is as closed to public intervention as most totalitarian structures. It isn't 'socialists' who worry about P3's, it is unions, because they know the profit motive knows no bounds.
The gun registry is a good example, do some research on it. The REASON why it cost so much was BECAUSE it was a P3, it would have been infinitely cheaper to do within government. Instead, it was handed out to Ross Perot's government which then began a billing system that had the government leasing ten year old computers and subleasing them back to Perot's company.
Virtually EVERY cost overrun in a P3 has been because of the private sector itnerests-not the public sector. However, if you ask a person whether they want a hospital now with a convoluted payment system they will never see, or else no hospital at all, guess which they will pick?
People have complaints about government, but have zero faith in corporations to manage anything in anybody's best interest but their own. And in New Brunswick, the most secretive government in North America, it definitely means "come and get er boys, money is flying everywhere".
That's something pretty ironic. NBT gripes about the government giving more money to corporations, but then says corporations should be brought in to work with government. That's pretty naive, if you think it costs money to prop up a company, what do you think a P3 costs? The gun registry was a P3, so there is your answer. By the way, there are now numerous hospitals being built with P3's in ontario, in fact all of them.
Sorry if I come across as someone who objects to black helicopter scenerios, but as I've said a thousand times before, this blog isn't an outlet for strange conspiracy theories. Either stick to the topic at hand or take the nonsense elsewhere. Other than that, blog away!
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What exactly is the conspiracy theory again?
I don`t agree that the state needs to provide it, but with a true cost benefit analysis, compared to all the graft your typical capitalist tacks onto a project, the state can do a fairly good job.
Would that be opposed to all the graft politicians and public servants bring into the equation?
A business would and could never go 200% over budget on a project, governments do it all the time.
How many Canadians not in an upper tax bracket do you think would like to repeal our socialized medicare system? Do you think the nurses spend their money differently whether they get it from the province or a private clinic? You`ll have to pardon me if I don`t weep for lost BMW sales to doctors.
Wow, talk about fear mongering. P3 isn't designed to replace our universal healthcare just to alleviate some of the burden of constructing and managing the infrastructure it depends on. The doctors, nurses and all staff essential to the provision of actual healthcare would still be paid by the system. Do you honestly believe that John Q public cares if the building that houses his MRI, or the MRI itself is owned by the government?
Although it might be true that full-out socialism demands a level of cooperation outside our capacity, it seems sad that this would always be the case. It certainly will be as long as we`d rather pay illegals to grow our food and slaves to make our clothing while the kids fry themselves out on Xbox and prozac.
Yes it is sad, sad that you actually believe the socialist lies you've been fed. How come socialism always ends up as a huge humanitarian disaster? How come socialists always resort to killing those that disagree? How come socialism as an ideology has killed more people than any other idea in the history of man, more even than religion? It is socialism that seeks to free the slaves as you called them, but only by making ALL of us slaves.
Somehow we got to a point where we`d suddenly let our leaders send the soldiers off for oil, we`d sit there high while millions get locked up for drugs, we`d even let the government fund Nicaraguan rebels through crack sales, while our cops learn to taser mental patients (have you seen the SSRI prescription rates).
If you believe that humans have the potential for good, you`ll join me in praying that these times someday end.
Perhaps once people start finding out how bad the banks have screwed them. The spin doctors and cheerleaders are trying their best, but the fundamentals will really test our collective credulity that uncle Sam and dick Cheney`s crew know what to do.
If enough people simply start talking about how little the money is really worth, how it was created and needs continuous exponentially growth to support the associated (stupefyingly enormous) total debt.
Unfortunately, it`s going to be an unfair fight - the same fight Christ was glorified for attempting - the globalists have the best military in the world, all the oil land and power, most of the weapons and hold all of the debt.
The people have controls over themselves and what they`re willing to do (i.e. accept worthless paper currency).
It`s a battle we can win, but not without help. Just think about it - if we still have a say in things - will it be private nurses, soldiers, lawyers and highways or take away the piggy bank from our capitalist monarchy?
Never mind. Someone obviously has slipped into the twilight zone.
This comment has been removed by a blog administrator.
Again, the gun registry was a P3, it was privately run and it went WAY over budget. In private industry companies go over budget ALL the time, and even moreso when they have a monopoly client-the government.
As for the view of what a P3 is designed for, thats not fear mongering. In order to make money, the system has to change. A P3 is designed to make investors and owners rich because they can cut costs and have a monopoly on the service. Just go look at what happened in Great Britain when they privatized their energy sector. It now takes more money to regulate it because ratepayers were getting so ripped off than it did to regulate it when the government ran the system.
Do you really think an investor is going to put money into such a deal when they can make 17% on investments overseas? In order to get investment it has to be financially viable, which means it often costs MORE (just over longer periods of time) or else labour costs have to plummet. Businesses aren't in business to do anybody favours, if it doesn't make money, they aren't interested.
But man, talk about fear mongering and believing lies. Go look up socialism in a dictionary. There has NEVER been a socialist government. Where exactly have all these killings been done? And MORE than religion? Thats just crazy, socialism didn't even exist as a political theory until the 1800's. Ironically, it has been socialists who have been persecuted far more than any political adherent.
If you are referring to the soviet union, that never even called itself socialist. Wake up and stop getting news from Fox. The CCP was nominally socialist, and Tommy Douglas was rated as the number one canadian. Funny but I don't remember 'mass murderer' being on his resume.
But just because something is 'state run' doesn't make it socialist. Stalin was a mass murderer (who was a good friend of Churchill, Churchill even did him a favour of sending back cossack defectors who worked for britain during the war so they could be murdered by Stalin).
So come on, talk about 'twilight zone' talking. Let's try to keep the debate in the real world.
It's actually the opposite, go read some history. In the states the people who won the war for the North were workers, who were fighting slavery, but not just negro slavery but what they called 'wage slavery'. Guess what, if you don't work, you starve. You lose your home, you lose everything. Thats why a basic rule of socialism is that workers OWN the factories, not foreign investors. And gee, just look at what a great job foreign investors are doing for New Brunswick-how many mills have closed now? How much corporate welfare goes on?
A public enterprise at least has the possibility of scrutiny, even if its hard. Most P3's have built in clauses so that you can NEVER find out how much you are paying for their services because its 'confidential private information'.
But again, just go look at the gun registry. That was a P3, and look what they ended up costing. There is no way that a private enterprise can build a building for less than government. Even if a corporation 'had the money lying around' the work has to be worthwhile, meaning it has to make them more than it would if they invested it elsewhere. In order to do that the government has to pony up a lot of dough.
To build it themselves they can use their own money, hey, how about that 'rainy day money' they are talking about. Even borrowing it on the open market is far cheaper as the province has an excellent credit rating. ANd you'll notice they had no trouble going into debt for 300 million for a little piece of highway, so a hospital certainly isn't a problem.
As for going over budget, that is easy, you just sign a contract. GOvernments don't do the work, they hire, just like private companies do. So you simply have a contract stating what gets done and for how much and problem is solved. Contracts are really neat things, you sign it beforehand and companies are locked into completion dates.
However, lets compare that to the private sector. Ever dealt with a housing developer before? Nuff said.
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