For immediate release: Jan. 07, 2003

EDMONTON – Alberta health regions and other public entities should be discouraged from entering into so-called public-private partnerships to build or operate public facilities, says the president of the Alberta Union of Provincial Employees.

Higher over-all costs and diminished accountability are likely outcomes of these so-called partnerships, said AUPE President Dan MacLennan.

"No matter how you look at these arrangements, they add up to poor – and potentially very expensive – public policy," MacLennan said. "It’s a dangerous strategy that shouldn’t be adopted without full and fair public debate."
Public-private partnerships offer governments a way to build major capital projects without appearing to use deficit spending, he explained. "The trouble is, financial risk associated with such projects ends up in the hands of the province. This can result in increased costs to taxpayers."

Both the Capital Health Region and the Calgary Health Region have indicated they are interested in public-private partnerships.

When such projects get into financial trouble, overruns are invariably funded with more money from the province, said MacLennan, elected leader of the 50,000-plus-member AUPE.

The over-all cost to taxpayers is likely to be far higher than it would have been if these facilities had been put out to public tender, built by private construction companies and then owned and operated by a public entity. "That way, costs are lower and the public owns the facility they’ve paid for."

"Public-private partnerships are simply direct or indirect mechanisms to subsidize businesses," MacLennan said. "I believe they will ultimately cost the province more. They are a bad long-term policy that will leave Alberta with fewer assets at the end of the process."

MacLennan said these arrangements also reduce accountability by putting elected officials further from the process that taxpayers finance, and further from the information they need to make decisions.

"This approach carries high risks to the public and needs to have more public debate to make sure voters have the most up-to-date information before public dollars are tied into long-term arrangements that have a negative effect on services and provincial infrastructure," MacLennan concluded.

For more information, contact:
Dan MacLennan, President, AUPE, 780-930-3301 or 780-910-8392 (cellular phone)
David Climenhaga, Communications Director, AUPE, 780-930-3311 or 780-717-2943 (cellular phone)