It’s like using a credit card to pay for our public services and infrastructure.
CUPE firmly believes that P3s are not in the best interest of workers, our families or our communities. On the contrary, we can count on public financing to be accountable, transparent, locally-controlled and a wise investment of tax dollars.
Here are some of the main concerns with P3s:
- “Off book debts” now will mean less available funding in future years.
- Higher-cost private finance can double the cost of infrastructure projects.
- Private finance will likely lead to higher user fees, which will increase inequality.
- P3 projects involve far higher transaction costs — fees paid to lawyers, financial advisors, accounting firms and other consultants — to develop the deals.
- Much of this extra money will likely flow out of the province, to large companies and investment funds.
So why would any provincial government rely on P3s with higher-cost private financing?
There’s a desire by many politicians to keep borrowing costs off their books, at least in the short term. There is also pressure from the P3 and finance industry which want to gain higher rates of return from investing in public infrastructure or privatized public assets.
Auditors, researchers and journalists across Canada continue to report on P3 failures and the unnecessary waste of taxpayers money, yet here we are in Newfoundland and Labrador about to embark on another foreseeable failure. Let’s put our health care dollars into the public health care system, not into construction cost overruns and the pockets of private companies – who may not even be from our province.