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Canada Infrastructure Bank’s board of directors named; P3 privatization on the agenda

Christopher Hickman, David Bronconnier, James Cherry, Stephen Smith, Jane Bird.

The Council of Canadians opposes the Trudeau government’s to-be-launched Canada Infrastructure Bank and notes that its recently appointed Board of Directors is heavily slanted toward supporters of public-private partnerships (P3s).

In terms of background:
October 2015 – Justin Trudeau campaigned on spending billions on infrastructure over the coming decade.
November 2016 – Finance Minister Bill Morneau announced the Canada Infrastructure Bank would be capitalized with $15-billion from existing programs and $20-billion in equity or debt tied to specific projects built with public and private partners.
November 2016 – Trudeau met with foreign investors with trillions of dollars at their disposal at a gathering in Toronto organized by BlackRock Inc.
February 2017 – former Ontario Teachers’ Pension Plan CEO Jim Leech (who oversaw the OTPP investing in privatized water utilities in Chile) named special advisor to help with the launch of the bank.
July 2017 – Janice Fukakusa, a former Royal Bank of Canada chief financial officer, appointed chair of the board.
November 2017 – Infrastructure Minister Amarjeet Sohi said the bank was on track to be running by the end of the year.

Then on November 16, the Board for the Infrastructure Bank was announced:

1- James Cherry – the former president and CEO of Aéroports de Montréal, who has previously advocated for airport privatization; recently appointed to the Board of the P3 McGill University Health Centre.

2- David Bronconnier – a former municipal politician who was mayor of Calgary from 2001 to 2010; promoted the P3 ring road extension.

3- Jane Bird – Vancouver lawyer who led the development and construction of the city’s P3 Canada Line rapid transit project.

4- Stephen Smith – First National Financial CEO, former board member of Metrolinx Inc.; major system expansions managed by Metrolinx have been P3s; sits on the Board of the C.D. Howe Institute; member of the Business Council of Canada.

5- Kim Baird – has past ties to Kinder Morgan Canada; was a registered lobbyist for the Woodfibre LNG project.

6- Christopher Hickman – chairman and CEO of Marco Group of Companies; currently serves on the boards of Nalcor Energy, Muskrat Falls Corporation.

7- Patricia Youzwa – former SaskPower president and CEO; has had policy advisory roles with the Canadian Electricity Association and the Energy Council of Canada; an Officer with the Canada West Foundation (which promotes mining, oil and gas).

8- Poonam Puri – Osgoode Hall Law School professor; on the board of Arizona Mining Inc.; previously on the board of the Greater Toronto Airport Authority.

9- Michèle Colpron – an international finance executive who has previously held senior positions with the Caisse de dépôt et placement du Québec, Merrill Lynch Bank, and Standard Chartered Bank.

10- Bruno Guilmette – former public pension executive who managed infrastructure files for the federal Public Sector Pension Investment Board and the Caisse.

Last week, the Canadian Press reported, “The bank will take $35 billion in government funding and use the money to potentially leverage three or four times that much [about $105-140 billion] in private dollars to help finance infrastructure projects across the country. Eligible projects will have to generate revenue, meaning roads, bridges, water and transit systems where user fees help to defray costs.” Infrastructure projects could also include hospitals, rail lines, airports, ports, and energy grids.

A CUPE media release has highlighted, “The plan for a Canadian Infrastructure Bank is a recipe for the cannibalization and privatization of Canada’s public infrastructure for profit by private institutional investors. The federal government should put the brakes on any move towards privatization and use low-cost public financing—instead of high cost private finance—for our public infrastructure.”

CUPE economist Toby Sanger explains, “There’s no shortage of low-cost public financing available to Canadian governments. Ottawa can now borrow at 0.6 per cent over a year and issue 30-year bonds at 1.8 per cent, with provinces a percentage point higher. Long-term borrowing rates have never been this low. Meanwhile large private infrastructure investors expect ‘stable, predictable returns in the 7 to 9 per cent range’…It doesn’t take an economist to understand it makes no sense to finance projects at seven to nine per cent when you can do so at two per cent.”

The Council of Canadians believes that for public infrastructure to be truly in the public interest it must be publicly owned and operated. We share the concern of allies that the Canada Infrastructure Bank will result in higher private financing costs, more privatization, increased profits for global investors, bigger executive salaries, lower workers’ wages, higher user fees, and greater inequality.

A CUPE media release on the bank’s board of directors can be read at Infrastructure bank board primed to privatize.