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Billions in Public Taxes Risked by P3 Hospital Privatization: 100 Failed, Flawed and Abandoned Projects Used to Warn Politicians

Posted: April 7, 2005

(April 7, 2005)

Toronto- As Ontario’s government is making plans to privatize hospitals, roads and schools under controversial long term deals with private finance and service corporations, a group of citizens’ organizations has issued a warning that the projects run the risk of being billion-dollar failures. Last July, Ontario’s Ministry of Infrastructure Renewal announced it would bring in a ten-year infrastructure plan, but the plan has not materialized. However, it has been confirmed that the government is considering private finance deals (P3s) for all new infrastructure projects in Ontario.

A new report, released today by health coalitions across Canada, outlines 100 failed, flawed or abandoned infrastructure projects undertaken using the controversial P3 privatization model. The report finds many troubling aspects to P3s, including:

  • cost overruns & delays
  • secrecy
  • design and construction flaws
  • quality problems & service cuts
  • legal disputes
  • failed contracts & bankruptcies

The report details complex privatization deals worth millions of dollars that have fallen apart, have been subject to lengthy delays and cost overruns, or have been abandoned as the expensive terms required by the for-profit companies become clear.

“We stand at the brink of perhaps the biggest transfer of public assets to private for-profit companies in the history of our country,” stated Natalie Mehra, Ontario Health Coalition coordinator and author of the report. “Yet the record of P3 projects is one of spectacular bankruptcies, environmental and construction disasters, legal disputes and service cuts. This policy must be subject to public scrutiny and debate, not brought in through the back door.”

“Our governments have a duty to look beyond the rosy picture painted for them by the companies that stand to make extraordinary profits from these deals,” added Dora Jeffries coalition co chair. “We have provided 100 examples that show P3s to be a risky waste of taxpayers money. Dalton McGuinty must make an unequivocal commitment to public services and stop taking foolhardy risks with services that are vital for our lives.”

“P3″, which stands for “public-private partnership” is a new term for a wave of deep and long-term privatization that is spreading across Canada. The schemes are promoted by a lobby group comprised of financial companies and private service providers. The country’s first two privatized P3 hospitals in Brampton and Ottawa were signed into being by Ontario’s Liberal government last autumn, despite election promises to the contrary. Governments in Quebec and BC are currently pursuing P3 hospital deals in Montreal, Vancouver and Abbottsford. In Calgary, Alberta, a proposed P3 hospital project has been abandoned. A P3 long term care facility was considered, then dropped in Cornerbrook, Newfoundland.

Plans have sparked protests in which thousands of people have marched and disrupted meetings of the private corporations in Toronto and Montreal. Patient groups, health professionals and unions are opposing the P3s as they result in bed cuts, clinical budget reductions and diminished access while paying hefty profits to the private sector out of public tax dollars.

The report, detailing a litany of cost overruns, legal disputes, bankruptcies, environmental disasters, and shoddy construction, is available at: www.ontariohealthcoalition.ca

For more information: Natalie Mehra 416-230-6402 (cell).

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