Recent debates swirling around the acceptance or rejection of Lean technology to increase efficiencies in the provincial government's health and education sectors has relegated the debates about using P3 models to replace aging infrastructure to the back pages.
We believe the jury is still out on the topic of using private/public partnerships to build or restore public facilities. It does appear as if our provincial government is anxious to embrace the concept as it allows them to kick the expense can down the road. It would relieve them of a vast array of responsibilities and would set up other companies and agencies to bear the brunt and responsibilities of paying and even managing new school buildings, nursing homes, hospitals, highways, bridges and culverts.
We here in this corner have already gone on record as being in favour of applying P3 models to a variety of provincial projects but only under certain guarded conditions.
Knowing the track record of major corporations, the ones that would be doing the bidding, buying, building and financing, our governments would need to ensure that concrete 35 to 40-year contractual agreements are signed before any construction begins.
We know that as a building, bridge or highway ages, the maintenance costs rise. There would have to be assurances that the private owner/manager had the funds in place to meet increasing financial demands. This would be difficult because in the private corporate sector, investor demands for increasing profits and dividends might tempt a company to put less in the piggy bank for an aging building, not more.
Who insures the package and even more importantly, who guarantees best management practises will be sustained? If the company that owns the public structure(s) merges with another company or gets swallowed by a larger company that wants to place less importance on maintaining four old buildings in Saskatchewan while building large commercial edifices in New York, London or Dubai, where are the guarantees? This happens all the time. No company is immune to friendly or hostile takeover. Governments who let out contracts under the P3 model have to realize that these mega corporations can wield uncommon power and influence on the lowly politician through their lobbying efforts and downright fearsome size. There is a reason why the phrase "too large to fail," became a popular truth when the North American economies took a nose-dive in 2008. Too big to fail also translates into too big for lowly provincial governments to fend off or dictate to when push comes to shove. It's sad, but true, and large business trumps government at every level. Just ask Quebec.
And finally, P3 would mean welcoming larger corporate entities who would look at our size and makeup and decide that while they won the contract, they only need to establish temporary field offices here with no long-term commitment and provincial jurisdictional regulations would get short shrift as they flex their corporate muscle.
So, would P3 work in Saskatchewan?
We believe so, but only if there is an accompanying high degree of caution and iron clad assurances in place to accommodate the expected contingencies.
