This Guest paper originally appeared in the November/December 2005 issue of the Taxpayer, a regular publication of The Canadian Taxpayers Federation (CTF), a federally incorporated non-profit and non-partisan organization dedicated to lower taxes, less waste and accountable government. This article is reproduced with permission and is copyright to the CTF and Sara MacIntyre © 2005.
Published here April 2006.

Editor's Note | Introduction | Design-Build-Finance-Operate
Capital Projects: What's Good, What's Bad? | Why Now? | Where is Canada on P3s?
Case Example: Abbotsford Regional Hospital and Cancer Centre

Case Example: Abbotsford Regional Hospital and Cancer Centre

The British Columbia provincial government and local health authority have acknowledged the need for a new hospital facility in its area since 1990. Political postponements and capital backlogs have delayed the project. As part of the provincial government's public-private partnerships initiative, Partnerships BC facilitated a competitive tendering process for the province's first ever design, build, finance and operate hospital.

Construction began in 2004 on the 300-bed facility and it is to open in 2008. The 30-year agreement includes a penalty schedule if the facility is not ready on time, set capital commitments from the public partner at $71.3 million and a performance-based annual operation payment of $41 million. "Operation" covers non-clinical services such as food, grounds keeping, janitorial, laundry and security. Expected savings over the life of the agreement: $39 million.

If the private partner is not performing the maintenance and operation duties to a specified standard, the public partner can deduct or withhold the entire annual payment. Try that with a monopoly government union.

Where is Canada on P3s?  Where is Canada on P3s?

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