Evidence shows public-private partnerships not a solution, experts

May 30, 2002

(Vancouver) A panel of experts from Britain, the U.S. and Canada on "public-private partnerships" (P3's) say that British Columbia should think twice before adopting the P3 model. Three of the four panelists, who were brought to Vancouver to speak at a public forum organized by the Canadian Centre for Policy Alternatives, appeared at a news conference this morning. All three have done extensive research on P3's and warn that the model is flawed.

Dr. Matthew Dunnigan, a member of the Royal College of Physicians of Glasgow and Edinburgh, has studied Britain's P3 model in health care, and says he is dismayed to see that British Columbia is considering the path taken in Britain over the past 10 years. "P3's in Britain have proved to be a costly mistake," says Dr. Dunnigan. "We have seen a serious deterioration in our acute care system, which is now reaching the crisis stage. People have less access to hospital care, they face longer waiting lists, and the quality of care has been compromised. My research shows clearly that the P3 model doesn't work in health care."

Heather-jane Robertson, the CCPA's national vice-president and a Distinguished Educator of the Ontario Institute for Studies in Education, says that this form of privatization also doesn't mix with education. "Nova Scotia built 30 P3 schools, and after 5 years of experience with them determined that they increased inequity, eroded communities, and cost $30 million more than if they had been publicly financed. BC doesn't need to make the same mistake."

Judith Greene is a criminal justice policy analyst with Justice Strategies and serves as a research consultant for both the RAND Corporation and Human Rights Watch. She has studied the U.S. experiment with P3 prisons, with a particular focus on how privatization affects the quality of correctional services. "After almost two decades of experience in the States, the evidence is clear: private prisons are under-performing those operated by the public sector, with higher rates of violence, and less effective program services." Ontario now has a private "super prison" and the Alberta government is studying the possibility of using P3's in corrections.

P3's are a hybrid approach to infrastructure projects where governments contract with private firms to design, build and sometimes operate facilities such as hospitals and schools. Under these contracts, private firms may retain ownership of the facility, which is then leased back to the government. Proponents of the P3 model, such as those speaking at an industry-organized conference in Vancouver beginning today, claim P3's save the public money. The experts brought to Vancouver by the CCPA presented facts disputing this view. They pointed out that research indicates P3's generally cost more over time because private firms face higher borrowing costs. P3's also lock governments into long-term contracts with no flexibility to meet changing needs. Private profit, not public interest, drives investments.

P3's also pose serious problems for public accountability. Participants at last night's public forum were warned that access to information is undermined when the details of public contracts are left in private hands. And in the event of problems, responsibility is shuffled between public authorities and private contractors.