POLITICS

Saskatchewan should scrap P3 model in light of Ontario auditor's report: NDP

12/10/2014 01:34 EST | Updated 02/09/2015 05:59 EST
REGINA - The Opposition New Democrats say an auditor's report in Ontario provides evidence for why Saskatchewan should scrap public-private partnerships to build infrastructure.

Auditor general Bonnie Lysyk said in her annual report on Tuesday that using the P3 model to fund 74 projects in Ontario cost nearly $8 billion more than if the government had paid the entire cost.

The Ontario government said the cost difference was more than offset by the risk of potential cost overruns if the projects were done through the public sector.

NDP finance critic Trent Wotherspoon said Wednesday that the Saskatchewan government needs to look at what he calls the mounting evidence in other jurisdictions against public-private partnerships.

"They continue to ram forward with an agenda that's not in the interest of the public," he said. "We call on the government to set aside this costly, risky process and start building the infrastructure that we need."

The government is using P3s to finance nine schools, a Regina bypass and a building that integrates a hospital and correctional facility.

"It's time to recognize a bad idea for what it is," Wotherspoon said.

Gordon Wyant, minister responsible for SaskBuilds, said he is confident in Saskatchewan's model.

He added that he hasn't yet read the Ontario report and he can't comment on Lysyk's methodology. Lysyk used to be Saskatchewan's auditor.

"I will tell you though that our P3 procurement in Saskatchewan does follow our auditor's recommendations. If anything comes out of the report that will enhance best practices in Saskatchewan with respect to P3 procurement, we'll certainly look at it," he said.

Lysyk found that the Ontario government assumed the risks of cost overruns and delays were about five times higher when the public sector was responsible for building infrastructure.

Wyant said Saskatchewan taxpayers will see "significant savings" with the P3 model because contracts stipulate that projects are delivered on time and on budget.

"We see time and time again with traditional procurement that projects are going overbudget, they're not being delivered on time," he said.

"All I can say is that I'm very comfortable with the methodology that we use."

Wotherspoon said the P3 model is misleading.

"To some extent it allows them to try to hide some of the debt if you will, having the private partner take on that debt at a much higher cost and then passing those costs back to taxpayers," he said.