Ambassador to UN Bob Rae says P3s needed for infrastructure to combat effects of climate change
The Canadian Council for Public-Private Partnerships held its annual conference remotely for the first time last month, in response to the COVID-19 pandemic. Drastic times call for drastic measures, as climate change also casts its shadow over the planet and economy.
“I don't think there's any question at all that we're going to see a need for an unprecedented level of international investment on infrastructure that will help us deal with climate change,” Canada’s Ambassador to the United Nations Bob Rae told conference participants in a keynote address.
“If we don't start yesterday, we're not going to get even close to the targets that we set ourselves for 2050.”
Governments can’t do it alone, he added, but will need the private sector.
Inevitably there will come a point at which governments, “after this extraordinary period, and public spending way beyond and above what anybody would have anticipated a year ago” in response to the COVID-19 pandemic, will need to set manageable limits on spending.
“We can't succeed without the private sector, without pension funds, without really significant partnerships between private capital and government, in order to achieve what we need to achieve,” said Ray. “I think we're going to see … unprecedented measures being taken to try to deal with these twin crises, and Canada is going to be very much involved.”
The conference, held over three days in mid-November, saw just over a thousand registered delegates from 38 countries – not far under its usual attendance numbers.
Public-private partnerships, or P3, is a trend that has “taken off all across Canada,” said Ted Betts, head of the Infrastructure & Construction Group at Gowling WLG in its Toronto office, in his remarks wrapping up the session “Canadian Infrastructure Procurement Agencies Tackle the Evolution of Infrastructure Delivery.”
“The opportunities, the resources, the infrastructure needs across the whole country are enormous, and really underpinning the growth and recovery in Canada economically.”
The session included representatives from infrastructure procurement agencies in Alberta, Saskatchewan, Nova Scotia, and Newfoundland and Labrador.
One observation was that large players in the infrastructure industry are partnering with local firms, and that Canadian P3 projects have benefitted greatly from international involvement.
“That happened more organically due to the level of interest in projects, and local players wanting to be involved,” said Gary Porter, Executive Director, Corporate Initiatives, for Nova Scotia Department of Transportation and Infrastructure Renewal.
“Establishing the up-front aspect of the procurement process … will require a large participation of local suppliers, so creating local awareness of opportunities has been important.”
“’Shop local’” is what we want,” agreed Andy Ridge, Assistant Deputy Minister, Properties Division for Alberta Infrastructure, but rounded out by a fierce competitiveness. “We are bullish in looking at international players,” with the recognition that they will pick up local supplies and labour. “It’s a nice marriage.
P3 projects have benefited greatly from the international community and “the innovation they’ve brought has been a huge benefit,” said Miguel Morrissette, Vice-President of Infrastructure Development for SaskBuilds. It has increased apprentice opportunities in local business, and the partnerships ensure “that we have the best from around the world, [and] local labour, too.”
Morrissette and other panellists also stressed the importance of market engagement in developing P3 projects.
“It's a very important time to take a step back and do the value-for-money assessment,” said Saskatchewan’s Morrissette, which can help the public understand that money can be saved by engaging in P3. Politics will also be important, and the public will be concerned regarding what they see as the privatization of services.
“But these projects sell themselves in many ways,” he says; “our projects have been on time and on budget,” including major hospital projects, where the P3 model has protected them in terms of risk. “The key thing for us is … trying to take the politics out of it, trying to get down to a place where we're making good decisions based on, ‘Is it the right tool for the job?’
Porter called the market-sounding aspect of the process “vital to our decision-making” in P3 projects. The Nova Scotia Department of Transportation and Infrastructure Renewal invites large and small, local and national firms in the design, construction and maintenance fields to hear about projects on the table, and gains feedback on the firms’ interest, capability, questions or barriers that they may see in the delivery of the projects.
“It’s important feedback on capability along the road and some of the challenges that they would face,” and contributes to the spirit of collaboration,” says Porter. “Those have really been helpful and instrumental in engaging with the community and using that feedback to help inform our processes.”