Costs up, control lost with P3 formula – CUPE
CALGARY – The Canadian Union of Public Employees is bringing forward more examples of failed school construction projects that used the Public Private Partnership (P3) model.
Yesterday, CUPE Alberta President D’Arcy Lanovaz released details about why the Nova Scotia government had to abandon P3 school construction, after costs escalated and communities lost control over their schools.
Today, Lanovaz is pointing to New Brunswick, where a P3 project to build Evergreen School ended up costing $900,000 more than it would have with conventional financing.
“The Auditor General of New Brunswick looked at this school, after it was built, and determined that the government could have saved $900,000 by not going the P3 route,” said Lanovaz.
Lanovaz said the Auditor General found the government could have saved $400,000 by taking advantage of lower borrowing costs available to government, $421,000 by not leasing back land they had already purchased, and saved other costs which increased as a result of the contract with the private operator. (SOURCE: NB Auditor General’s report – 1998).
Lanovaz said given the evidence from the Maritimes, it makes little sense for the Alberta government to be entering into P3s to build schools in this province.
“The Nova Scotia government backed away from P3 schools, the New Brunswick government regretted P3 schools, but Alberta is embracing them?” asked Lanovaz. “This defies logic.”
“The Alberta government plan will add costs to each school, it will take schools out of the publics’ control, and it will attempt to hide debt from the public books. It does not serve the interests of students, education, or the taxpayer.”
Contact: D’Arcy Lanovaz
President, CUPE Alberta
For more information about CUPE Alberta, visit www.alberta.cupe.ca