By Rose Marie Losier, director general at the Canada-Spain Chamber of Commerce | Public infrastructure in Canada has been aging in recent years and the country has seen the need to replace them. In this context, governments at both federal and provincial level, have found in models of public-private partnership (PPP) an interesting formula that allows them to leverage funding and innovation with support from the public sector.
What are PPPs? The public-private partnerships are an alternative for governments to meet their programmes on public infrastructure. Through long-term PPP contracts, which include design, construction, financing, maintenance and operating components, public administrations can access the experience, technology and capital from private sector. Unlike traditional procurement, PPP projects provide the private sector a greater role in the design, construction, financing, or operation of public infrastructure and offer a unique business opportunity, allowing private companies to offer a wide range of services in different industries over a period of long-term concession (usually 25 to 35 years).
In 2008, the agency PPP Canada was created to develop the knowledge and ability of the federal government on PPP and optimise federal investments in infrastructure projects at the provincial, territorial, municipal, and First Nations level with the Canada PPP Fund . The mandate of this company is using the PPP model to improve the set up of public infrastructure by increasing the quality and speed of projects with better accountability and better use of taxpayers’money.
To meet this mandate, the government has given to PPP Canada four main functions: investing C $1.2 billion to catalyse the use of PPPs by all levels of the administration, checking on large infrastructure projects of over C $50 million carried out by administrations seeking federal funds so as to encourage the use of PPPs where appropriate, assessment of opportunities for PPP projects at the federal level and acting as a source of knowledge and advice on PPP.
The provinces of British Columbia, Ontario, Alberta and Quebec have been the first to adopt the PPP system and, to date, they are those that have hosted the vast majority of these projects. As a result, Canada has a large number of PPP contracts in the areas of social and transport infrastructure such as hospitals, courthouses, roads and bridges, which are key areas of provincial responsibility.