ABOUT PUBLIC PRIVATE PARTNERSHIPS (P3’s) – By Michael Goldberg

Public Private Partnerships (P3)

P3s have been characterised as an alternative to full privatization of publicly funded infrastructure and services. There is a broad continuum of P3s.

One end of the P3 continuum is Design Build infrastructure, where the project is financed by the government and a consortium designs and builds the infrastructure under the terms agreed upon. The consortium assumes any construction risks that may arise within the terms agreed upon. The New Westminster Secondary School Replacement Project is an example of a Design Build P3.

At the other end is the Design, Build, Finance, Operate and Maintenance P3. As its name implies, this type of P3 involves both private financing for the construction and the consortium providing ongoing service operation and maintenance. The infrastructure and operation are turned over to the public entity at the end of the agreement. The Canada Line is an example of a more complex P3. The Canada Line will be turned over to TransLink (Greater Vancouver Transportation Authority) at the end of the 35-year agreement.

The BC Auditor has prepared a very good report that explains P3s;

UNDERSTANDING PUBLIC PRIVATE PARTNERSHIPS 

See http://www.partnershipsbc.ca/projects/ for a list of P3 projects in BC. Each completed project listed has a case study link, which is a short description about the completed P3. Each completed project also includes a link to a report, which is a detailed paper prepared by Partnership BC with comments about the conclusions by the Auditor General of BC.

While governments and the private sector have argued that P3s provide value for money, others have argued that the evidence of such is either very weak or that the evidence shows that many of the P3s do not live up to their initial promises.

See for example: PPPs: THE PASSAGE OF TIME PERMITS A SOBER REFLECTION by Graeme A. Hodge and Carsten Greve at http://onlinelibrary.wiley.com/doi/10.1111/j.1540-6210.2007.00736.x/full
This paper argues that evaluations of public–private partnerships thus far point to contradictory results regarding their effectiveness and value-for-money. Despite continuing political popularity, greater care is needed to strengthen future evaluations.

Given the dubious results to date, one must question if a P3 of the Design, Build, Finance, Operate and Maintenance is a legitimate alternative for a long term care facility on the Sunshine Coast.

Research by Dr. Margaret McGregor and others show that “there is considerable evidence from observational studies that public funding of care delivered in for- profit facilities is inferior to care delivered in public or non profit facilities.”

Observational Evidence of For-Profit Delivery and Inferior Nursing Home Care: When Is There Enough Evidence for Policy Change?

http://irpp.org/research-studies/study-no14/

So, while there may be a relatively small ”money for value” outcome using a P3 approach, it is questionable that such “savings” are worth the inferior care that seniors receive when looking at the services provided by for-profit private care providers.

P3 Summary prepared by Michael Goldberg Jan/18

WE URGENTLY ASK THAT OUR SUPPORTERS WRITE MR. HORGAN, MR. DIX AND MR. SIMONS…