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The Privatization Party

Photo of Eddy Almeida for blog

The following letter was submitted to the Hamilton Spectator by 1st Vice-President/Treasurer Eduardo (Eddy) Almeida:

The Privatization Party

Privatization promises cost savings for taxpayers. But make no mistake. It’s big business. Yet despite this, privatization is a growing industry.

Why? Because there’s money to be made.

Recently Auditor General Bonnie Lysyk reported that the Ontario Liberals paid $8 billion more dollars more than they should have to complete infrastructure projects throughout the province.

That’s $600 dollars for every man, woman, and child in Ontario. Money that could have been used for quality public services and municipal infrastructure projects.

Instead of instituting internal accountability measures, government is caught up trying to make privatization deals that promise infrastructure modernization.

Politicians need to wake up. Outsourcing doesn’t work.

Public-private partnerships leave the government’s purse wide open with little oversight to protect the taxpayer.

On budget and on time is easy to achieve when budgets are purposely expanded. What’s really needed is transparency and accountability.

While P3’s are advertised as being mutually beneficial, clearly, the Ontario experience says otherwise.

Politicians elected in the short term have little regard for protecting the taxpayer’s long-term interest. Today’s politician is more interested in re-election or feathering the nests of their future.

Accountable budgeting is reduced to “guesstimating”. And those “guesstimates” get put into the contract. “Guesstimating” leaves wiggle room. It allows the private supplier to take advantage of the government’s lack of due diligence. Contract language protects their interest, not ours.

And, it’s all disguised as cost savings.

Unfortunately, these cost savings rarely materialize. The devil is in the contract’s details.

Service levels change? That’ll cost you.

Requirements change? There’s a fee for that too. 

Change suppliers? Now you’re paying twice as much.

And who suffers? We all do.

Lack of consistent governance and oversight allows the contractors to go rogue. Cost overruns follow. Service levels aren’t met. And the people who rely on the service are suffering because of the outsourcing agreement.  

Reworks follow. And that costs.

That’s where the real money is made. Changing contracts means the imposition of penalties. And that’s how government and taxpayers are held ransom.

More penalties mean more money. And corporate bonuses roll in.  

And the Liberals are OK with that.

The Wynne regime has locked themselves into one of those unbearable Bay Street cocktail parties with no escape plan.

But what’s the problem with that?

They are the life of the party and all of their friends are drinking from the trough.

Mismanagement? Hardly. They are managing their friends’ interests quite well. Unless a public inquiry is called into the privatization industry—this is going to be a three year party.  

It’s time to pull the plug.