North Battleford Hospital to cost far more as a P3

The Sask. Party believes that having Saskatchewan people be the project managers on the Saskatchewan Hospital at North Battleford is very risky – which is why they’re willing to pay millions more to have a corporation from the United Kingdom manage the building and maintenance.

A government report released Thursday shows that the price of building and handling maintenance of the mental health and corrections facility through straightforward public building and ownership methods is $309 million. The same price via a P3 rent-a-hospital scheme is $363.4 million.

But the Sask. Party then says it estimates that having Saskatchewan people manage the project equates to a whopping $176 million in ‘risk.’ P3 ‘risk’ calculations have been panned by auditors across the country as unjustified, largely made-up numbers to make P3 projects look better than they are and were called “full of assumptions” by Saskatchewan’s own auditor.

“This shows that the P3 only offers value if the Sask. Party was definitely planning to run a $176-million cost overrun on this project,” said NDP Central Services critic Warren McCall. “Unless they have a crystal ball showing that an earthquake will hit North Battleford three-quarters of the way through construction, I think that number is ludicrous.

“Saskatchewan people and companies absolutely can manage projects on-time and on-budget. We don’t need to turn to a corporation from the United Kingdom to build and maintain Saskatchewan’s health care facilities.”

In Ontario, the Auditor General looked at 74 P3 projects and said that using the P3 method cost that province’s taxpayers an additional $8 billion.

A government backgrounder released in September pegged the P3 construction-alone cost to be $222 million. That means $185 million being given to the United Kingdom conglomerate is for maintaining the pipes and similar hard infrastructure for 30 years, as well as to pay for the higher costs of a P3, like interest fees.

“It shouldn’t cost $185 million to maintain a brand new building – that’s a terrible deal for taxpayers, especially when that’s on top of our daily operations costs,” said McCall. “The Sask. Party seems to have forgotten that money belongs to taxpayers.

“The Regina bypass is being built and plowed by a European company. The P3 schools are being built and maintained by a conglomerate from the United States and elsewhere. This hospital project goes to a British company. When the Sask. Party turns to a foreign corporation to manage a project, it’s shipping hundreds of millions of dollars – and some good jobs – to other countries instead of keeping them here in Saskatchewan. That’s not putting Saskatchewan first, it’s clearly not delivering on value for Saskatchewan families.”