Re: Megaprojects need public-private partnerships, March 31

Megaprojects need public-private partnerships, March 31

I was sorry to see that TD Bank had joined the cadre of P3 propagandists who are distorting what the auditor-general of Ontario said about P3s in her annual report.

To be clear, the A-G did not claim, as the TD report suggests, that public projects never go over budget. What she actually said was that Ontarians paid a whopping $8 billion premium for P3s with no data or evidence proving they are actually worth anywhere near this much.

Public projects can and do indeed go over budget, and so there is a price worth paying for cost certainty. But not just any price.

And in the case of Ontario, the $8 billion P3 price-tag is equivalent to a 30 per cent cost over-run on every single P3 project. For comparison, the Toronto-York Spadina Subway Extension is currently 15 per cent over budget.

In other words, if every P3 project had been procured traditionally, they all could have gone 15 per cent over budget just like the subway, and Ontarians still would have saved $4 billion compared to what we paid for P3s.

By the way, the A-G also noted that $6.5 billion of the $8 billion went not to the contractors who actually build the project, but to financiers such as TD Bank, due to the higher cost of private financing compared to public borrowing.

In fact, TD Bank helped finance the new Whitby train shed P3 project mentioned in the Star article. But this relationship was not disclosed, nor was TD’s obvious interest in promoting and profiting from P3s.

Catherine Fife, MPP Kitchener-Waterloo, Ontario NDP Finance and Treasury Board Critic

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