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P3 model misguided and expensive
The recent decision by the Vancouver Island Health Authority (VIHA) to build the new Campbell River and Courtenay hospitals utilizing the Public-Private Partnership (P3) model is misguided and expensive.
Our provincial government has mandated that major projects go through Partnerships BC, despite the fact that there is increasing evidence that this approach does not save taxpayers money nor transfer the ‘risk’ to the private corporations.
Firstly, governments can borrow money to finance capital projects more cheaply than the private sector, so we must now absorb this additional cost. With P3’s much of the profits wind up out-of-province and country in corporate coffers and there is no long term gain for our communities.
Secondly, VIHA has indicated that housekeeping and maintenance services will be privatized and the current staff will be laid off. Contractors are notorious in paying low wages with minimal benefits or worker protections.
If workers attempt to join a union, they are let go with little recourse. The experience with private contractors in health care in the Lower Mainland is that workers are poorly trained in areas such as infection control and the hospital management has no control over employee turnover, which is frequent due to the non-livable wages and benefits.
As well, many workers are forced to juggle multiple jobs to survive, and fatigue sets in. I totally concur with E.A. Foster’s letter to The Record entitled ‘More child poverty on the way.’
B.C. continues to have the highest child poverty rate in the country.
Further, the private contractor is guaranteed their profits for 30 years, regardless of the utilization. A good example is the Golden Ears Bridge in Maple Ridge, which is under-utilized due to tolling, yet the company will continue to reap profits for ‘projected’ usage from the public purse.
The Port Mann bridge project has problems in collecting tolls through misread licence plates. As well, there are no reciprocal agreements with out-of-province jurisdictions, so those motorists cannot be billed, so we pick up the tab again.
The sales mantra of the risk being shifted away from government is a theory that also does not stand up to reality. In cases where there are system problems e.g. flooding, electrical failure, equipment malfunction, the public demands that services be restored as quickly as possible and blames the government if they are not.
The result is that in-house staff must correct the problem or the health facility needs to hire local contractors. If the P3 contractor refuses to take responsibility, it can result in lengthy and costly litigation with corporations and multi-nationals that have very deep pockets and tax write-offs.
What is even more galling is the fact that the public never sees what tax dollars are being spent on. For instance, what contingency clauses are included that can significantly increase expenditures through add-ons.
By way of a real example, if the utilization of hygienic hand cleaner, that is widespread throughout health care facilities, exceeds agreed to levels, what additional costs to maintain/increase this are incurred?
If cleaning levels required for a sterile environment exceed contracted expectations, who picks up the cost and for how much?
There have been problems elsewhere.
The P3 contracts are not made public and the ‘requirement’ for competitive corporate confidentially trumps any freedom of information. These P3 contracts are more political expediency than due diligence for fiscal prudence and service integrity.