Public-Private Partnerships and the PMO

January 26, 2009

A few weeks ago Dr. Al Drummond of Perth drew attention to the problem local hospital staff had in finding a bed for a patient who was a suicide risk. The chronic shortage of acute care facilities for mental health patients impacts daily upon emergency room staff.

January 26, reporter Mohammed Adam of the Ottawa Citizen ran a front-page story “Audit on Royal Ottawa sought” in which he described the case of the private consortium-built Brampton Civic Hospital. “Conceived as a 716-bed hospital, (it) opened with 479 beds in October, 2007.  Two months later public protests over medical deficiencies and shortages of beds and staff forced the Ontario government to appoint a supervisor to run the hospital.”  Adam goes on to quote the Ontario auditor general’s report which showed that the hospital had an initial cost overrun of $194 million.  Because of the higher interest rate charged by the consortium, over the life of the lease it will have cost taxpayers an additional $200 million more than if the project had been financed by government.

The justification for the audit call in the case of the Royal Ottawa, another P3 consortium contract, is that while in its two years of operation it has had “serious problems, including building quality and equipment failures,” its management has remained extremely secretive.  “Hospitals are not bound by provincial freedom-of-information laws…and the Royal Ottawa has been particularly reluctant to disclose information on its project and the only way to get it is through the auditor general,” said a spokesperson for The Ontario Health Coalition in the article.

The P3 program is a legacy of the Harris government.  Its dealings are conducted well away from the public eye, and the history of cost overruns puts one in mind of the carpetbaggers who plundered the American south after the Civil War.  In Mike Harris’s home town, the North Bay hospital was budgeted at $551 million.  It cost $1 billion.  Sarnia’s figures were $140 million and $320 million.  The Royal Ottawa’s budget was $100 million and the final figure was $146 million.

These figures remain numbers on a page until it is your relative or your patient who can’t find a hospital bed.

So what does this have to do with the return of parliament after the Christmas recess?  I’m worried.  The idea of Stephen Harper and Jim Flaherty with $64 million in their pockets scares me even more than Mike Harris’s giddy cut-fast-cut-deep-don’t-flinch mantra which he and his staff (including Flaherty and Guy Giorno) chanted as they lay waste to the public sector of Ontario.

Political pressure for stimulus spending in this budget leaves Harper in the enviable position of having a huge sum of money with which to buy votes.  With his hyper-partisan attitude, I can’t imagine him seeing beyond that initial thought.

Today’s Citizen shows two examples of the complexity of government spending:  Harper has ordered 1,300 non-combat trucks for the military, a contract with the U.S. company Navistar worth $274 million.  But the trucks will be built in Texas, and 500 workers at Navistar’s Chatham plant have received layoff notices, with another 200 expected in the spring (David Pugliese “Make sure defence projects create jobs here, Tories told”).  So far Harper’s spending to upgrade Canadian military equipment has not generated the promised benefits for Canada’s defence and aero-space firms.  Peter McKay wants to buy $3.1 billion worth of Italian search and rescue aircraft which will be built in the U.S.A.  Alenia has made no real commitment to create Canadian jobs in return for the deal.

According to Pugliese, the worry is that the Harper government doesn’t take enough care to look after Canadian jobs in these deals.

Spending money calls for wisdom and integrity.  Do you remember Pierre Trudeau taking $100,000 for harbour improvements away from Westport because of a fight with MP Tom Cossitt, and then bestowing the same money, unasked, upon Perth?  Can you imagine John Baird doing better?  Remember the mess he made of the light rail portfolio in Ottawa just to give pal Larry O’Brien a boost in the polls?

Through the hype of the budget this week, we should bear in mind who, apart from Stephen Harper, really calls the shots in Canada at this time. The PMO is run by Guy Giorno who was Mike Harris’s right hand man.  The massive program cuts of the Harris era were his idea.  His deputy Patrick Muttart, an ardent neo-conservative, tries to remain invisible, but has been implicated by Maclean’s magazine in the In and Out scandal.  Darrel Reid campaigned against divorce, abortion and same-sex relationships as head of Focus on the Family Canada.  Then he became chief of staff for Rona Ambrose on the way to his current position as deputy director of policy and research in Harper’s office.  “Jasmine Igneski is an adviser on economic affairs, environment and energy security. Kory Teneycke, the director of communications, is advising on how to sell the budget – and its whopping fiscal shortfall – to the media and, through them, to Canadians” (Les Whittington, Toronto Star).

If the PMO manages to turn the stimulus money into votes – and it’s hard to imagine them doing anything else with it – I wonder how they will get the Canadian finances back out of the deficit?  My guess is that, if this cabal is still in power, they will push Harper to sell the health care system to the highest  bidder.

I think of this and then I think of Obama’s call last week for the interests of the few to give way to the interests of the many, and I want to weep.

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