P.E.I. union warns province against public-private partnerships

'When something looks too good to be true - it usually is.' - Shelley Ward, PEIUPSE

Charlottetown (5 Dec. 2007) - The Prince Edward Island Union of Public Sector Employees (PEIUPSE/NUPGE) says it will cost provincial taxpayers more than they should be paying if the government enters into public-private partnerships (PPPs) to replace long-term care facilities.

"The government has acknowledged that our long-term care facilities are in need of replacement. Islanders will not argue that fact," union president Shelley Ward says in a letter distributed to island media.

"This undertaking will cost a considerable amount of money. When the finance minister tabled his capital budget in the house on Nov. 2, 2007, he said this in regard to manor replacement, 'We’re looking at further ways that we can put more money into it. We’re looking at public-private enterprise,'" Ward notes.

"For the average taxpayer this would sound like a reasonable way to deal with the problem. It may even seem to be the best solution considering there is a projected deficit. I am sure that the Finance Minister is counting on this mind set to gather support for such a partnership. The problem is that public-private partnerships do not save taxpayers money," Ward says.

"When a private company enters into a contract with government to design, build and sometimes operate facilities, they retain ownership of the building and lease it back to the government," she notes.

"Supporters of these funding arrangements say that this will save the public money. But many experts will disagree. They argue the fact that private business has to pay more to borrow money - resulting in higher costs over time. They also caution that these arrangements lock governments into long-term leases with no flexibility to meet changing needs. The main concern is private profit not public interest," Ward argues.

While PPPs may seem like a quick fix, island taxpayers will see the reality is otherwise when they are fully informed about hidden costs and other associated problems, she adds.

"When something looks too good to be true - it usually is," she says. NUPGE