Made-up numbers to justify P3s mean taxpayers may pay more

The independent Provincial Auditor says the government builds its so-called value-for-money reports on public-private partnership (P3) projects using unsubstantiated numbers. 

In Ontario, the Auditor General found this practice in that province cost taxpayers an extra $8 billion on 75 P3s, compared to straightforward building models. 

Auditor Judy Ferguson said Wednesday of the government's approach to P3 justification: "It's full of estimates. It's full of assumptions."

“Rather, we found that participants and external experts made decisions about identified risks, and calculation of related costs based primarily on the results of verbal discussions,” says the auditor's report. "Not making information available in writing or maintaining key empirical data makes it difficult to substantiate or scrutinize decisions, particularly those that require a high level of expertise and professional judgement."

NDP MLA and deputy caucus chair Cathy Sproule says said she's concerned the government is ignoring evidence from other jurisdictions as well as Saskatchewan's own auditor to continue its support for P3 privatization at any cost. 

"P3s often mean communities pay more and get less," said Sproule. "The plan to have private corporations own and operate our children's schools while we rent them back is something I definitely hear opposition to – but the government is pushing it whether real numbers support it or not."

Ferguson said not only should the government have to show the final price for the P3 – she called for a financial cushion to be built in to P3 cost estimates to make up for major uncertainty in assumptions. Three out of four Saskatchewan P3s she examined didn't have such a cushion. 

The government also doesn't have a standard requirement for how to evaluate P3s or release the evaluations. 

"The government policy for itself is, apparently, to make it up as they go along at every stage of the P3 process," said Sproule. “We're talking about billions of dollars here. The Sask. Party has got to stop stubbornly pushing P3s based merely on its worldview."