In Quebec the Public-Private Partnership Agency, currently studying different PPP scenarios, will submit its report this December. One hot issue for the end of Premier Jean Charest’s tumultuous mandate is therefore likely to be the controversy ar-ound Quebec’s biggest construction and investment project – the two university hospital centres.
According to Health Minister Couillard’s latest estimates, the University Hospital Centre of Montreal (known as CHUM) and the University Health Centre of McGill (CUSM), planned for 2010-11, are projected to cost $3.6 billion. This dual project, the most important in the health sector’s last forty years, is equal to seven per cent of Quebec’s annual budget. Up to now, the Charest government seems to want to invite the private sector to construct and maintain the buildings for thirty years, as well as to foot the bill. If this takes place, the formula is supposed to give the government a short-term budget break.
What is not being said is that if the private sector finances the construction, it will have to pay a higher rate of interest. On top of this, we know that the private sector always gives itself a healthy profit margin. The construction costs alone are suggested to be $1.6 billion. So – where are the savings to come from?
Some analysts go so far as to say that the government is simply resorting to creative accounting in order to preserve its neoliberal dogma on the dangers of public debt and the virtues of private enterprise.
In their quest better to understand the famous British PPPs that so inspire the Charest government, the directors of CHUM and the CUSM went to check out the situation in the United Kingdom. Their observations led them to conclude that PPPs would not be advantageous for projects as big and all-encompassing as CHUM and the CUSM. Numerous problems were reported in the European experiences, like the creation of private monopolies and two levels of administration that are not in sync with one another. The directors instead proposed an alternative formula: the creation of a para-public agency that would issue public bonds and that would put out a call for proposals for the construction of the hospital. This agency would maintain control over the centres’ real estate and their maintenance personnel.
Premier Charest seems to be making more of an ideological and cosmetic move than an effort to ensure healthy public finances. Opening the door to the private sector is his principal objective. This has already been achieved on several fronts: subcontracting (which has been facilitated by the retraction of a labour code that protected unions in situations of complete or partial change of management or ownership) and the construction of nursing homes. In addition, following the Supreme Court of Canada’s Chaouli decision, private clinics operating outside the public system can take clients who face an unacceptable wait in the public system. Individuals will also be able to buy private insurance to cover the cost of private health services, in parallel to the public system.
The contortions used by Premier Charest and Health Minister Couillard to cover up the breaches to the public system since the Chaouli decision are perhaps a foreshadowing of what can be expected in the CHUM/CUSM dossiers.
Many are asking whether Quebec can even afford to have two mega-hospitals – one Francophone, one Anglophone – thereby duplicating many specialized services. Or should there instead be only one University Hospital Centre, an integrated national institution that would guarantee services in English to Quebec’s Anglophone minority? Will the Charest government try to find a solution to this thorny question – of such importance to public finances – or simply use the opportunity to tailor a place for the private sector?
This article appeared in the September/October 2006 issue of Canadian Dimension (Good to the Last Drop).