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  • Could skyrocketing private sector debt spell economic crisis? June 21, 2017
    Our latest report finds that Canada is racking up private sector debt faster than any other advanced economy in the world, putting the country at risk of serious economic consequences. The report, Addicted to Debt, reveals that Canada has added $1 trillion in private sector debt over the past five years, with the corporate sector […]
    Canadian Centre for Policy Alternatives
  • Betting on Bitumen: Alberta's energy policies from Lougheed to Klein June 8, 2017
    The role of government in Alberta, both involvement and funding, has been critical in ensuring that more than narrow corporate interests were served in the development of the province’s bitumen resources.  A new report contrasts the approaches taken by two former premiers during the industry’s early development and rapid expansion periods.  The Lougheed government invested […]
    Canadian Centre for Policy Alternatives
  • Canada-China FTA will leave workers worse off June 2, 2017
    Global Affairs Canada is currently consulting Canadians on a possible Canada-China free trade agreement. In CCPA’s submission to this process, CCPA senior researcher Scott Sinclair argues that an FTA based on Canada’s standard template would almost certainly reinforce rather than improve upon Canada’s imbalanced and deleterious trade with China. It can also be expected to […]
    Canadian Centre for Policy Alternatives
  • Faulty assumptions about pipelines and tidewater access May 30, 2017
    The federal and Alberta governments and the oil industry argue that pipelines to tidewater will unlock new markets where Canadian oil can command a better price than in the US, where the majority of Canadian oil is currently exported. Both governments have approved Kinder Morgan's Trans Mountain Expansion Project, but a new report finds that […]
    Canadian Centre for Policy Alternatives
  • Weathering the storm: is this the end of CRA’s political activities audits? May 5, 2017
    Yesterday, following a panel’s recommendation to allow charities more freedom to speak out, the federal government decided to suspend the Canada Revenue Agency’s controversial political activities audit program. Indeed this is good news for Canadian charities. Everyone at the CCPA is proud of the role our organization has played in challenging these audits and in […]
    Canadian Centre for Policy Alternatives
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The Progressive Economics Forum

Regina Hosed by P3 Waste Water

Regina City Council has voted to proceed with a 30-year public-private partnership (P3) in which a private company would design, build, finance, operate and maintain the city’s new waste water treatment facility.

The municipal administration’s rationale has been that, although a P3 will be more expensive than traditional public financing, it is required to access federal money from the P3 Canada Fund.

However, Hugh Mackenzie’s recent analysis concludes that the additional costs of a P3 would actually exceed the full value of the federal grant. As my dad noted with the following letter in Saturday’s Regina Leader-Post, that means this federal “infrastructure” funding is not helping to pay for the infrastructure but is simply being transferred to private financiers.

P3s wrong model

Your May 7 article (Project ‘doesn’t make any sense’: economist), states: “Proceeding with a public private partnership (P3) to upgrade the city’s waste water treatment plant is going to cost Regina taxpayers $60 million more than if the city paid for the project itself.”

Economist Hugh Mackenzie’s study also concluded that even after subtracting the expected federal funding, the P3 model would still be more expensive.

P3s are very costly. In essence, the city is hiring a private operator to borrow money to finance part of the plant.

The private partner must pay higher interest rates to borrow than the city and will expect to make a profit each and every year. In addition, the costs to structure a complex P3 deal are substantially more than the costs of straightforward public borrowing.

The city claims the only available federal funding requires a P3 model. Without P3 strings attached, the proposed $50 million federal contribution could be used to reduce the cost of our $200-million wastewater plant to $150 million.

With a P3, the $50-million federal grant will not be used to reduce the cost of the project to citizens of Regina. It will be misused to pay the higher private interest charges, the profit demanded by the private partner and the higher P3 deal structuring charges – enriching bankers, lawyers and financiers.

The Harper government should help fund infrastructure. But requiring the P3 model squanders our tax dollars to support their friends in business.

David Weir, Regina

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