The Federal Commitment to Public Private Partnerships (P3s).
Is it real?
About 4 years ago, the federal government established P3 Canada Inc. – a crown agency designed to facilitate P3s at the municipal and provincial levels of government. A $1 billion fund was established by the Finance Minister and municipalities and provinces (with some private sector proponents in tow) were encouraged to apply to P3 Canada funding on an annual basis. Essentially, the fund is designed to be exhausted in about 5 years and can provide up to 20% funding on approved projects. As a result it is possible for P3 Canada to leverage up to $1 billion in P3 funding on an annual basis. Although a public agency, it is very difficult to determine if these targets have been met. Given the number of completed projects cited on the website, one has to conclude that the federal facilitated projects are much lower than projected.
In the last year or so, the P3 Canada mandate has been expanded to include facilitating P3 development on federal projects. The new federal P3 preoccupation involves a new requirement that all federal projects over $100 million and with a 20 year or more lifespan undergo a P3 “screen”. The process for screening has been set up by P3 Canada and the worksheets to determine project applicability are on the P3 Canada website for all to review. The process mirrors the federal bureaucracy approach to many government priorities: Let’s establish a paper shuffling exercise to make it appear we actually are trying to change, modify or be innovative. Mandatory regulatory impact assessments and mandatory socio-economic impact assessments come to mind. Essentially, whole divisions of bureaucrats spring up to write up justifications for doing things the same way they have done them before or the same way that the government established as the safest and most risk adverse way to proceed. Just consult any Canada Gazette publication to see how skillfully the bureaucrats in these divisions use language to make it appear that alternatives have actually been considered.
I attended the P3 Canada annual meeting a month ago. The meeting room was jam packed. Given the fact nobody from government asked any questions, one has to surmise that attendees were mostly federal bureaucrats. Some Labour organizations and NGOs that oppose P3 were also present. Essentially P3 Canada is telling everybody that their job now is to be a missionary for P3s. When queried about whether a real project will actually emerge from the federal “commitment”, they cite a few federal projects such as the Canadian Security Establishment complex and the new Montreal bridge as evidence. Pretty thin gruel and knowing a bit about these projects they have proceeded or are proceeding for a raft of reasons that have little to do with federal government commitment to P3s. P3 Canada Management talk about receiving many more applications, particularly from municipal governments, for funding under their program. The fact is that many provincial and municipal governments committed themselves to P3s and Alternative Forms of Delivery years and years ago. The reason more people are applying to P3 Canada is because other sources of funding are drying up.
So the federal commitment to P3s and Innovative Alternative Forms of Delivery is there on paper but there’s much more to do. The question is whether the federal leadership exists to actually do things differently and more innovatively. It is not clear. Maybe it is time for advocates to push them a bit.