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Infrastructure bank lacks transparency: Report

0 172 Government

by Russell Hixson

A new report by the Columbia Institute is criticizing the Canada Infrastructure Bank (CIB) for its plans to use private partners and limit access to information.
Infrastructure bank lacks transparency: Report

The bank was established by federal legislation in June 2017 and will be operational later this year. It arose from a 2015 Liberal campaign promise to create a national bank that would use the federal government's ability to borrow money in a more affordable way in order to support infrastructure projects, such as providing water treatment facilities and public transit for local governments.

The report, Canada Infrastructure Bank and the Public's Right to Know, examines the bank and government legislation that allegedly prevents public access to information. The report also highlights concerns expressed by information commissioners and includes examples of how the Canadian government can do better.

According to the report, the bank will encourage more private service and infrastructure delivery, which is already a growing trend in the country. According to the Canadian Council for Public-Private Partnerships, in 2016 there were 200 P3 projects tendered or completed with a nominal cost of $114 billion.

"The federal government is ready to invest $35 billion in public funding to create a new infrastructure bank intended to attract private investors for public projects," said Keith Reynolds, the report's author in a press release. "At the same time, in June, government passed legislation that would further undermine the public's access to information about the bank."

The report stated that result will not provide savings to taxpayers.

The report states auditor generals in British Columbia, Ontario and Quebec have all raised issues around the high cost of public-private partnerships. B.C.'s auditor general found the cost of borrowing through P3s was double the cost of public borrowing. Ontario's auditor general said Infrastructure Ontario's use of private-public partnerships has cost $8 billion more than traditional public financing, the report notes.

The institute claimed the CIB as proposed would make it difficult for residents to check projects to make sure money is being spent wisely.

Legislation creating the CIB forbids the bank from releasing any information obtained from proponents' private sector investors or institutional investors involved in infrastructure projects.

The legislation also adds the CIB to Schedule II of Canada's Access to Information Act, a part of the legislation that limits public access to information, further limiting public disclosure, the report states.

As governments increasingly turn to public-private partnerships for the delivery of services, proprietary information, trade secrets and competition are cited as rationales for secrecy with these private contractors.

"Essentially, private sector interests are given a veto over releasing information about how public funds are spent," wrote Reynolds in the report.

"Freedom of Information requests to government are often denied, delayed or arbitrarily redacted. This erodes the transparency and accountability needed for the functioning of a healthy democracy."

Reynolds cited a recent case in B.C. where it took almost a year for a media outlet to receive information about potential political interference in the construction of the Port Mann Bridge. Leaked documents suggest the B.C. Liberal government rushed to finish the project and overpaid in the process. The bridge cost $527 million more than the original estimate.

The institute's report identifies three recommendations to government to improve transparency.

First, they suggest that private entities delivering substantial public functions or services, or receiving substantial government funding to carry out public functions or services, should be subject to access to information legislation.

Second, they are asking Canadian jurisdictions to adopt a policy of prompt and full proactive disclosure of all procurement records, including preliminary analyses, business case documents, successful and unsuccessful bids, evaluations of bids and contracts.

Finally, the institute is asking all Canadian jurisdictions to move to a discretionary standard for the release of information that has gone before cabinets or cabinet committees.

"When citizens are blocked from knowing the details of government operations it undermines both the accountability of government and democracy itself," reads the report.

"While this is particularly true for financial information, it is also true for the delivery of services. Canada, which once was one of the world's freedom of information leaders, has fallen behind."

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