6/27/11

It's not a P3, it's a P4: a Public-Private Partnership Problem

More trouble at Windsor's public private partnership (P3) long term care (LTC) project on the old Grace Hospital site.  This is the long delayed LTC project that is driving up the bed backup at local hospitals.  


After much delay, the Ontario Minster of Health and Long Term Care had announced the private developer had come through -- on the (supposedly) final day of the deadline


But, the Windsor Star reports that eleven days later, the guy hired to demolish parts of the building left and took his cranes with him.  He said he hadn't been paid.


The Minister then told the Star that "this issue has nothing to do with the developer's ability to continue to move forward with the project.  This is an issue between the contractor and subcontractor."


But the Star reports the owner of the cranes, was pretty clear that wasn't the problem.  "I haven't been paid, and the job's not started. So I'm moving my equipment out."  The equipment had been there for seven months, and he had never been paid.  The developer did not return the Star's calls.  


So, on Thursday, the government announced another deadline (Friday) for the developer to get financing in place.  After an hour of looking over the documents submitted , the government stripped the developer of the contract.  Finance Minister Dwight Duncan said they were "nowhere near" sufficient.


Duncan acknowledged that there has been a "horrendous cost" to the health care system and the region's seniors who were waiting for long term care beds to become available.  "This contract has been completely violated," Duncan said.


Government's usually justify the extra costs associated with P3s by arguing they transfer risk to the private sector (and then make us pay heavily for it).  


Ha! In this case, Duncan justified the (long) delay before the final cancellation of the contract  by arguing that the government was trying to avoid being sued by the developer!   "We had to go extra mile to insure that he would not have a case against the province," Duncan pleaded.  


The project was supposed to be completed over a year ago.  The project hasn't even begun: the government is now re-starting the bidding process. 

Also on Friday, the government announced a $100 billion, ten year program to expand public facilities, with even more projects to be done through public-private partnerships.



Why not? It's only time and treasure.   

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