P3 promotion agencies ignore reports by auditor generals

Letter: Partnership is an empty buzzword

creynolds Own Your NL, Privatization

The following letter to the editor was published on Monday, November 5, 2017, in The Telegram.

The St. John’s Board of Trade offered nothing new in their Oct. 27 letter to the editor (“P3 model unduly criticized”) that hasn’t already been said by consultants and lobbyists that stand to profit from these misguided deals.

P3 promotion agencies ignore reports by auditor generals - print adWhen public-private partnerships (P3) promoters use buzzwords like “innovation” and “stability” while talking about P3s, it means they’ve drunk the Kool-Aid. Privatization can take many forms, and its promoters often use different terms to hide what they’re doing.

The term “partnership” can be misleading. Board of Trade chair Dorothy Keating said it herself. “The Canadian P3 market is attractive to investors.” Their goal is not to save taxpayers money. It’s profit.

P3s are long-term contracts that allow for-profit enterprises to finance, build, own, maintain and/or operate a public infrastructure asset and the services it provides. P3s are structured to guarantee the private sector profitable payments and/or user fees, while governments are left holding the risk.

P3s allow politicians to keep upfront costs off the books and let private companies arrange financing until the project is complete. Politicians get credit for delivering new infrastructure while passing future operating and maintenance costs off onto future politicians and taxpayers.

For example, the Corner Brook P3 hospital and long-term care facilities are “Define, build, finance, maintain” projects. That’s privatization.

The value for money that Keating mentioned is often calculated by using biased comparisons in case studies, cherry-picking data and ignoring reports by auditor generals.

High rates of return come at a price for future taxpayers. The P3 parade provides excellent returns for investors today because future generations will pay the price through massive and growing liability payments.

Newfoundlanders and Labradorians should take pride in the fact we’re the only province that hasn’t drunk the Kool-Aid – yet.

Wayne Lucas, president
CUPE NL

Update: After this letter was written, Premier Dwight Ball awarded a P3 contract to a consortium of private companies to design, build, finance and maintain a long-term care facility in Corner Brook (Friday, November 3, 2017). 

Delegates hold up voting cards at national convention 2017

Convention 2017 – Moving Forward Together

creynolds Article, Collective Bargaining

Delegates hold up voting cards at national convention 2017Dear Sisters, Brothers, and Friends:

We’d like to thank the 2,200 delegates who took the time out of their lives to attend our National Convention in Toronto last week. We know it’s not easy, and we appreciate your commitment to our union, and the honesty and civility with which you engaged in debates around our union’s priorities, policies and structure.

We accomplished a lot together, and we wanted to share some of the key decisions that were made.

Strike Pay

Delegates approved a resolution to begin pay for eligible members of striking locals on the first day of a strike, instead of the fifth, as is currently the case. This move will strengthen the position of locals who encounter obstinate and unreasonable demands from employers at the bargaining table. This change to strike pay is effective immediately.

Coupled with the union’s renewed bargaining policy, which rejects all attempts by employers to force concessions and two-tier proposals on workers, we now have a full set of tools to take on bargaining in a climate of aggressive austerity.

Strategic Directions

Delegates also adopted CUPE’s Strategic Directions, which establishes the union’s priorities for the next two years. The plan sets out how we will make gains in our workplaces and communities, fight racism and discrimination in all its forms, defend public services, and advocate for a better country and world.

Task Force on Governance

Delegates approved a resolution to create a Task Force on Governance which will review the structure of our union as laid out in the constitution. Our governance structure has not changed significantly since our inception as a union in 1963, despite the substantial growth and changes in our membership in the intervening 54 years, and this assessment is long overdue.

The task force will look at the current and historic composition of our leadership, the role and responsibility of the positions that make up the National Executive Board, and the structure of our chartered organizations as well as that of other labour organizations. The task force will make recommendations to the National Executive Board by March 2019, and the NEB will submit any constitutional amendments necessary to the 2019 National Convention.

Once again, we’d like to thank each and every delegate for their work.

In solidarity,

MARK HANCOCK
National President
CHARLES FLEURY
National Secretary-Treasurer

Letter: No evidence P3s are cost effective

creynolds News Release, Own Your NL, Privatization

The following letter to the editor from CUPE NL President Wayne Lucas was published in The Telegram on September 201, 2017.

Provincial government Ministers Steve Crocker and Dr. John Haggie have taken exception to the alarm bells CUPE is ringing about the higher costs of P3 deals. 

In a letter to the editor of Aug. 26, the ministers claimed two recent P3s were proof of successful P3 projects: Swift Current Long Term Care Centre in Saskatchewan and Interior Heart Surgical Centre in British Columbia.

Coincidentally, Plenary Health, in the running to build the Corner Brook Long Term Care P3, was involved in the Saskatchewan and British Columbia P3 projects.

Saskatchewan’s Auditor General reviewed the Swift Current Long Term Care Centre and three other P3 deals in 2015 concluding that the value for money assessments were rigged by consultants to favour the P3 model. There was no hard evidence to prove P3s were more cost effective than the public-sector option.

British Columbia’s Auditor General raised major concerns about the high cost of debt through P3 projects in 2014. She examined 16 different P3 projects in the province and reported that interest rates on the province’s $2.3 billion of P3 debt ranged from 4.42 per cent to 14.79 per cent. The BC government can borrow money at around 3.1%. Her review concluded that P3 projects created higher levels of debt than if the government had financed the projects itself.

CUPE’s Senior Economist reviewed the numbers for the Interior Heart Surgical Centre in British Columbia and estimates that the project would have cost $37.5 million more than claimed if an appropriate discount rate had been used. This would have made the P3 more expensive than the public-sector comparator.

Most of the cost-savings boasted about by P3 advocates are based on value for money calculations and when these calculations are scrutinized by impartial experts, like a provincial auditor, they are proven to just not be credible. 

I would urge ministers Crocker and Haggie to put away the glossy consultant flyers and read the Auditor General reports on P3s.
Wayne Lucas
President, CUPE Newfoundland Labrador

New Radio Ads: August 14 – September 3, 2017

creynolds Collective Bargaining, Crossroads

Two new radio ad campaign by public service workers in Newfoundland and Labrador hit the airwaves this week, on radio stations across the province. CUPE’s public services workers launched the ads to voice their concerns about the Ball Government’s failure to protect good jobs, as well as the impact on our economy and our public services.

The radio ads will play until August 20.


Listen to radio ads 3 & 4

CUPE believes the Ball Government should recognize the public sector as a driver of economic growth. There are steps the Province can take in the collective bargaining process – and in the next budget – that put people first, protect the public services we need, create good jobs and a stronger economy.

CUPE Newfoundland Labrador represents approximately 6,000 public service workers in health care, education, treasury, public housing, provincial libraries, university, transition and group homes, child care and much more.

Listen and watch all the ads at nl.cupe.ca/crossroads.

Let’s stop the Ball Government from saddling us with even more debt

creynolds Opinion, Privatization

People living in Corner Brook and the surrounding region have needed new health care facilities, including more beds in long-term care, for many years. It came as welcome news to everyone, including CUPE members and their families, when the province announced two new facilities would begin construction later this year.

However, the secrecy and lack of transparency around these two projects are very troubling. In a meeting with Minister Bennett and Minister Hawkins, in March this year, our representatives were told the details of these projects would be made public, but only after the contracts are signed. That’s a red flag!

Send your MHA a message: Stop P3 deals before you saddle us with more debt

What exactly are public-private partnerships? Instead of using its own borrowing power, a government looking to build public infrastructure uses private-sector money for the project. The private sector invests some (or all) of the required money in return for healthy financial returns and a measure of control.

As explained by economist Toby Sanger, financing a project at the 7-9% return rate that private investors expect from infrastructure investments would dramatically increase the total cost of a project financed over 30 years. If the province directly borrowed the funds, they would get the current 30-year bond rate of 3.7%. There’s another red flag!

The NL Government has stated that the Corner Brook long-term care facility will cost $120-140 million and the hospital will cost $700-900 million. Assuming the province is borrowing money to finance these projects, P3 deals would cost almost twice as much to borrow as public procurement. Why on earth would we do that?

Long-term care facility borrowing costs

Principal Public:

3.7% amortized over 30 years

P3:

7% amortized over 30 years

$120 million $79 million $167 million


Hospital facility borrowing costs

Principal Public:

3.7% amortized over 30 years

P3:

7% amortized over 30 years

$700 million $460 million $977 million

There is plenty of evidence to show that P3s are the wrong way to finance public infrastructure.

The additional beds and services in Corner Brook will create new jobs, but that will happen regardless of how the facilities are built, and assuming the two projects don’t go over budget.

The additional costs could result in closing beds, laying off staff and reducing quality of care. Look at the P3-built North Bay Regional Hospital, which cost at least $160 million more than public procurement would have cost. Over 50 beds have been closed, and they’re on the third round of layoffs with over 100 jobs cut.

The P3 deals that the Ball Government wants to use are a Trojan Horse that will allow the quality of our public health care to be influenced by private interests and profit margins.

CUPE Newfoundland Labrador urges the Ball Government to take the following action:

Make public the full details of the Corner Brook value-for-money report and business case – before final decisions are made and any contracts are signed.

In addition, the Province should mandate:

  • Public consultation
  • The involvement of a provincial auditor
  • Public-Private Partnership Transparency and Accountability legislation that demands a preliminary analysis – available to the public – outlining the risks, costs and benefits of using a P3

We are going to pay for these projects one way or another. We might as well build our health care facilities publicly. Let’s own and control them ourselves, for the public interest and not for private profits.

Wayne Lucas
President, CUPE Newfoundland Labrador

Send your MHA a message: Stop P3 deals before you saddle us with more debt

Keep our health care facilities out of the hands of private interests: Rally on August 15

creynolds News Release

The P3 deals that the Ball Government want to use to build health care facilities in Corner Brook are a Trojan Horse that will allow the quality of our public health care to be influenced by private profits.

People living in Corner Brook and the surrounding region have needed new health care facilities, including more beds in long-term care, for many years. It came as welcome news to everyone, including CUPE members and their families, when the province announced two new facilities would begin construction later this year.

But at what cost? The secrecy and lack of transparency around these two projects are very troubling.

The Ball Government’s plan to use public-private partnerships (P3s) to build Corner Brook health care facilities could cost almost twice as much as public procurement.

Please join us and tell the Ball Government to keep our health care facilities out of the hands of private interests! Meet our 15-foot tall Trojan Horse too!

WHEN: Tuesday, August 15 at 4 p.m.

WHERE: 40 University Drive, Corner Brook

WHO: Speakers will include Mark Hancock, CUPE national president; and Wayne Lucas, CUPE NL president


Media contacts:
Please contact Wayne Lucas or Colleen Reynolds.

 

Meet our Trojan Horse at the Royal St. John’s Regatta

creynolds News Release, Privatization

CUPE Newfoundland and Labrador would like to invite everyone to meet our 15-foot tall wooden Trojan Horse at the Royal St. John’s Regatta on August 2. Members will be on hand to talk to the hidden dangers of using public-private partnerships (P3s) to build health care facilities.

The Ball Government plans to use P3 deals to build two health care facilities in Corner Brook – as if it’s a gift to the people of Newfoundland and Labrador. But they’re not willing to make public all the details of their value-for-money assessment before the contracts are signed. We think that’s a huge red flag!

Like the mythical Trojan Horse, P3-built health care facilities are a hollow promise that threatens our public health care system with increased costs down the road, leading to fewer beds, job cuts and lower standards of care.

Private financing is more expensive than the rate the province could borrow at and the facilities become too expensive to operate. The health care facilities will be forced to make cuts and the only part of the budget that is not tied up for 30 years are the doctors, the nurses and other staff. Inevitably, quality of care will suffer.

If these P3 deals go through, the provincial government will pay more over the long-term, pushing costs onto generations of taxpayers.

To date, we have wisely avoided using P3 deals in Newfoundland and Labrador. P3s have been a disaster in every jurisdiction they’ve been used – in every province and every sector.

Let’s talk about it. Please join us at the St. John’s Regatta.

Learn more about P3 deals

 

 

 

Call for Volunteers – Join CUPE at the St. John’s Regatta!

creynolds Privatization

Say NO to privatizing our health care! 

CUPE needs your help to hand out information telling the Ball Government to keep our health care facilities out of the hands of private interests.

Please join us August 2nd at the Regatta! Every CUPE member who helps will get a CUPE Trojan Horse t-shirt.

While at a meeting in Deer Lake yesterday, Minister Haggie said, “Staff from the province were meeting with three vendors interested in taking on the project.” Haggie went on to say the long-term care build is estimated at $120 to $140 million, a $20 million variance and the acute care build would see numbers over $700 million, approaching $900 million.

A $200 million variance! I don’t take a lot of comfort in these inconsistent numbers.

To volunteer, contact Sister Sherry Hillier with your availability. Please indicate whether you can volunteer for 4 hours, 2 hours, all day, in the morning or in the afternoon.

Email: sherryhillier@nl.rogers.com

Telephone: 709-765-2996

PLEASE DISTRIBUTE THIS MESSAGE TO YOUR MEMBERSHIP.

In Solidarity,

Wayne Lucas
President, CUPE Newfoundland Labrador

Volunteer now – Send an email

CUPE NL mourns the passing of Sister Susan Shiner

creynolds Uncategorized

CUPE Newfoundland Labrador was saddened to learn of the passing of Sister Susan Shiner who was a feminist activist and stood for social justice and equality within the CUPE family and in society.

Susan was a long-time member of both CUPE local 3762, Iris Kirby House and CUPE Local 3017, Daybreak Parent Child Centre.

Susan served on CUPE’s National Women’s Committee and also CUPE NL’s Equality Committee. She was a fierce advocate for equality for all, for childcare, and for universal non-profit childcare throughout the country.

Susan was always there when called upon and also worked very hard with our Political Action Committee.

She will be sorely missed.

Wayne Lucas
President, CUPE Newfoundland Labrador