HomeDiagramsDatabaseMapsForum About
     

Go Back   SkyscraperPage Forum > Regional Sections > Canada > Alberta & British Columbia > Vancouver > Transportation & Infrastructure


Reply

 
Thread Tools Display Modes
     
     
  #1  
Old Posted Mar 24, 2009, 2:11 AM
LotusLand LotusLand is offline
Registered User
 
Join Date: Jul 2008
Posts: 612
P3 Good or Bad?

Just came across this on the vancouver blogosphere: http://vancitybuzz.blogspot.com/2009...-p3-model.html

Apparently Arnold like our use of P3 in numerous projects. Then I read a comment on the blog

"The problem with the P3 contracts that the BC government has signed is that the taxpayer assumes most of the risk while the private sector reaps all of the rewards.

Most of them end up being back-end revenue deals. RAVCO put up the $1.5B up front capital expenditure. SNC-Lavalin will operate the Canada Line for 35 years. Which means SNC-Lavalin has the GVRD by its balls for the next 35 years.

P3s aren't necessarily bad. Just the ones that have been signed in this province."

Perhaps he is just a disgruntled NDP supporter or is there merit to the comment.

I thought this would be a great starting point for discussion on public private partnerships. You know the advantages and disadvantages of using them.
Reply With Quote
     
     
  #2  
Old Posted Mar 24, 2009, 2:23 AM
djun djun is offline
Registered User
 
Join Date: Feb 2009
Posts: 78
There was a report on Global BC yesterday about P3 projects and how the Governor of California, Arnold Schwarzenegger, went on national TV in praise of BC P3 projects and how our model should be copied.

Go to GlobalBC Videos, then click on Newscasts, then on News Hour Global BC March 22. It's the first story of the news hour.

Of course Global interviewed the NDP critic, who I personally think did not have a very substantial comeback (if at all), explicitly saying that Schwarzenegger is wrong by suggesting all this "hocus pocus" and needs to do some more research, rather than talking to just only Premier Gordon Campbell.
Reply With Quote
     
     
  #3  
Old Posted Mar 24, 2009, 2:39 AM
jlousa's Avatar
jlousa jlousa is offline
Ferris Wheel Hater
 
Join Date: Jun 2006
Posts: 8,371
Completely depends on how the contract is negotiated and worded, P3s can be good or bad on a case per case basis. In general it allows the government to do more upfront with the money it has.
A perfect example is (numbers made up for ease of explanation) Jimmy P has $1Million, he can buy land, build a store and open 1 Save-On foods, he then collects revenue on that one store, or he can rent and outfit 10 stores with that same $1Million, he ends up having to pay rent on those stores and gets less from anyone of those stores then he would from the one he could of built, but he has the revenue for 10 stores which more then makes up for that. In some cases it makes more sense not to sink all your money into one project and to spread it around.

Ravco doesn't have the government by the balls, as if they fail to deliver the service requirement the government can and would pull the plug on them. Ravco did get the government to guarantee ridership figures to ensure they don't get screwed over.
Reply With Quote
     
     
  #4  
Old Posted Mar 24, 2009, 3:56 AM
amor de cosmos amor de cosmos is offline
BANNED
 
Join Date: Jun 2005
Location: lodged against an abutment
Posts: 7,556
according to the recent OECD study posted here
http://forum.skyscraperpage.com/showthread.php?t=166606

Quote:
Past experience has shown that exclusive public sector ownership and provision can lead to inefficient investment decisions. Different organisational forms have been increasingly used in the network industries that would permit more private sector involvement. Furthermore, new contracting techniques, such as public-private partnerships (PPPs), are also on the rise, especially in the United Kingdom, Spain and Korea, and can potentially harness the private sector effectively in the provision of infrastructure. However, these contracts are not suitable for all projects and their design is important for ensuring adequate and efficient investment. Policy settings vary considerably across countries, suggesting in some cases ample scope to improve policy in this area. In particular:
− The decision making about the use of concessions and PPPs should be transparent to ensure that they are the most appropriate method of investment.
− Contract specification should share risk appropriately between the parties and investment incentive mechanisms should be specified throughout the concession period.
− Monitoring of investment decisions and performance evaluation throughout the contract period are important to guarantee value for money.
(p.7)
Reply With Quote
     
     
  #5  
Old Posted Mar 24, 2009, 4:45 AM
johnjimbc johnjimbc is offline
Registered User
 
Join Date: Jul 2007
Posts: 766
I agree with jlousa's opinion. I think there can be really good P3s and very bad P3s, depending on how they are configured and contracted.

They need to be well designed to attract private investors and ensure bidders have incentives to participate, but the risks need to be shared between the public and private enterprise. Likewise the bidding process needs to be fair and open and truly competitive. If not, the public at minimum won't get their money's worth. At worst, corruption could result.

I think in general they are very good idea. Unlike some people, I think the government can do many things well. But when you start talking about construction projects and other type projects, a better solution can result from having public and private partners.

I don't want to change the topic, but what I've found myself questioning lately is the whole crown corporation concept. The examples of crown corporations in BC sometimes make me think the entities become more interested in building their empires and protecting their own interests than actually solving problems or fulfilling their mission statements. They can be corrupt or secretive, yet if there are any tough questions the government seems to avoid responsibility citing their quasi-independence. I have more concerns about the lack of transparency with them then I do with P3s.
Reply With Quote
     
     
End
 
 
Reply

Go Back   SkyscraperPage Forum > Regional Sections > Canada > Alberta & British Columbia > Vancouver > Transportation & Infrastructure
Forum Jump


Thread Tools
Display Modes

Forum Jump


All times are GMT. The time now is 8:40 AM.

     
SkyscraperPage.com - Archive - Privacy Statement - Top

Powered by vBulletin® Version 3.8.7
Copyright ©2000 - 2024, vBulletin Solutions, Inc.