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"If governments really don’t want to be associated with privatization, they should keep services public instead of paying consultants to come up with new euphemisms for privatization.” — Larry Brown, NUPGE President
Ottawa (21 March 2017) — If media reports are correct, the federal government will be using wildly inaccurate claims to sell Canadians on its proposed infrastructure bank. According to a Canadian Press story today, an economic growth council presentation on the infrastructure bank glosses over the fact that those investing in federal infrastructure projects expect a hefty profit on their investment. Instead, the presentation claims that relying on private investors will free up funds for other public services.
“All too often those pushing privatization try to claim private sector investments are ‘free money.’ But once you add in investor profits and the other costs that come with privatization, the public are actually paying more,” said Larry Brown, President of the National Union of Public and General Employees (NUPGE).
Privatizing infrastructure means less money for other services
Far from freeing up money for other public services, privatizing infrastructure actually costs the public more. A 2014 Ontario Auditor General’s report found that using P3 privatization schemes for 74 projects increased the cost by $8 billion. Other reports from unbiased sources have come to similar conclusions.
Infrastructure bank is a privatization scheme
Based on what has been announced so far, the federal governments infrastructure bank will be used for large-scale privatization of public infrastructure like roads, bridges, and transit routes. But the federal government still refuses to admit that the infrastructure bank is a privatization scheme.
“Privatization has a reputation for higher costs, poorer service and no accountability so it’s understandable that governments don’t like using the word”, said Brown. “However, if governments really don’t want to be associated with privatization, they should keep services public instead of paying consultants to come up with new euphemisms for privatization.”
“Given the hopes many people had for this federal government, I hope the media reports are wrong,” said Brown. “Fudging the facts about expensive privatization schemes is why people are extremely cynical about the Wynne government in Ontario and increasingly cynical about the Wall government in Saskatchewan.”