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Harper’s ‘Building Canada Fund’ promotes P3s

CBC reports, “The Conservatives announced in last year’s federal budget $14 billion over 10 years in new infrastructure money under a new Building Canada Fund but the details have yet to be made public. With the 2014 budget just over a week away and still no details about the new fund (which is scheduled to come into effect on April 1), cities say they are at risk of losing thousands of jobs that come with the construction season. …Without the details of the program, cities have to wait to find out if their projects are eligible for funding under the new plan before applying.”

In 2011, the Harper government generally outlined that, “The priority funding categories for the (Building Canada Fund) will be Core National Highway System (NHS) Routes, Drinking Water, Wastewater, Public Transit and Green Energy.” Today’s news report notes, “In Calgary, city council approved on Friday a $900 million expansion of its transitway but the project will require funding from both the province and the federal government. …Last September, Toronto Mayor Rob Ford saw Prime Minister Stephen Harper and Finance Minister Jim Flaherty pledge $660 million from the new Building Canada Fund for the extension of a subway line.”

The Harper government has also stated, “The Building Canada plan encourages the development and use of P3 (public-private partnership) best practices by requiring that P3s be given consideration in larger infrastructure projects funded through the Gateways and Border Crossing Fund and by the Building Canada Fund. Specifically, all projects seeking $50 million or more in federal contributions will be required to assess and consider the viability of a P3 option.”

Last May, the Financial Post reported, “The public-private partnership model for building infrastructure has made inroads into provincial projects such as hospitals and schools. …Sitting in the bull’s-eye are water and waste treatment facilities.” But significantly, that article adds, “John Loxley, an economics professor at the University of Manitoba, opposes P3s and any expansion of them into the municipal sector. ‘The argument in favour of P3s has been exaggerated’, he says, noting there hasn’t been any long-term analysis of benefits. He calls the risk calculations ‘highly dubious’, also believing governments pay too much in interest payments and says P3s cut small, local contractors out of the picture.”

In her book Blue Future, Council of Canadians chairperson Maude Barlow writes, “If the right to water is to be honoured, it is crucial to keep municipal water services in public hands and to maintain their status as a public service.”

After the signing of the Canada-European Union ‘free trade’ deal last October, she wrote, “This deal will give French companies Suez and Veolia, the two biggest private water operations in the world, access to run our water services for profit. Under a recent edict, the Harper government has tied federal funding of municipal water infrastructure construction or upgrading to privatization of water services. Cash-strapped municipalities can only access federal funds if they adopt a public-private partnership model, and several cities have recently put their water or wastewater services contracts up for private bids. If Suez or Veolia are successful in bidding for these contracts (and under the new deal, local governments cannot favour local bidders) and a future city council decides it wants to move back to a public system, as municipalities are doing all over the world, these corporations will be able to sue for huge compensation. Private water operators charge far higher rates than public operators and cut corners when it comes to source protection. Privatization of water services violates the essential principle that Canada’s water is a public trust.”

In 2011, the Council of Canadians participated in a successful campaign with the Canadian Union of Public Employees to defeat the P3 ‘Stave Lake Water Project’ proposal in Abbotsford, British Columbia (the P3 was rejected by local voters even with the Harper government promising to put more than $65 million into the project). In 2013, we campaigned with Water Watch, CUPE and local allies to try to stop a P3 wastewater plant in Regina, Saskatchewan and a P3 water treatment plant in Saint John, New Brunswick. We also continue to work with CUPE to promote the ‘blue communities project’ with municipalities across the country, and now around the world. That initiative asks municipalities, in part, to pass a resolution promoting publicly financed, owned and operated water and waste water services.

Further reading
WIN! Abbotsford rejects P3 water proposal
P3 wastewater plant in Regina could cost $61 million more than public option
Saint John faces costly P3 for their drinking water
From Burnaby to Bern municipalities are protecting the water commons