Expensive privatization mistake to be repeated in Ontario | National Union of Public and General Employees

Expensive privatization mistake to be repeated in Ontario

Despite the track record cost overruns in the millions of dollars, the Ontario government continues to use P3s to construct new hospitals, while hiding true costs from the publc.

placard saying P3 means Public Pays Private ProfitsOttawa (04 April 2014) — When a decision about how to build a hospital increases costs by $394 million, you would expect things to be done a bit differently the next time there was a big construction project. Not in Ontario.

Public-Private Partnership increased costs of new hospital by $394 million

In a 2008 report, Ontario's Auditor General found that the decision to use a Public-Private Partnership (P3) to build a new Brampton Civic Hospital for the William Osler Health Centre increased the cost by $394 million. That increase represented over half of the construction cost of $614 million.

But in spite of this costly mistake, the Ontario government is using a P3 to build another new facility for the William Osler Health Centre. It was announced that a consortium has been selected to build and operate the Peel Memorial Centre for Integrated Health and Wellness.

Public still being kept in the dark about cost of privatization

As in the case of the Brampton Civic Hospital project, the public is not being told the cost of the construction. Even though a lot of public money will be spent on the project, the cost will not be released until the project is finished—when it is too late to complain.

Information that would allow the public to see the real cost of the project will be kept hidden on the grounds of corporate confidentiality. The only way the public can find out the true cost of a P3 is when Auditors General investigate them.

Public interest needs to be protected from privatization

"As long as governments can use P3s and other forms of privatization as a way to borrow money and pretend it's not debt, they are going to be tempted to privatize public services," said James Clancy, National President of the National Union of Public and General Employees (NUPGE). "That is why conditions for privatization proposals are needed to protect the public."

Clancy continued, "Full disclosure of all information on costs and service levels, comprehensive consultations, and a guarantee that public interest will trump commercial interests are necessary before P3 projects move ahead. Until then, as the Peel Memorial Centre P3 shows, expensive privatization mistakes will keep being repeated."

More information:

Privatization Zombie (video)

Public-Private-Partnership doubles cost of new hospital

Privatization: Same old game: Brand new threats

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The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE

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