Transport Committee on Oct. 17th, 2011

[Paul Moist]

I walked.

[Mark Adler, Conservative, York Centre, ON]

Do you have a—

[Paul Moist]

I live near Parliament Hill and I....

[Mark Adler, Conservative, York Centre, ON]

How do you normally transport yourself around on union business? Do you have a driver, or do you use public transit?

[Paul Moist]

I fly while the airlines are flying.

[Mark Adler, Conservative, York Centre, ON]

Through the city streets...do you drive?

[The Chair, Conservative, Merv Tweed]

I'm going to go to Mr. Nicholls now.

Mr. Nicholls.

[Paul Moist]

I do drive. Absolutely.

[Mark Adler, Conservative, York Centre, ON]

You're a driver.

[The Chair, Conservative, Merv Tweed]

Thank you.

[Paul Moist]

I am a driver. I'm a good driver.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Nicholls, you have five minutes.

[Jamie Nicholls, NDP, Vaudreuil—Soulanges, QC]

Thank you, Mr. Moist, Mr. Sanger, and Ms. Cameron.

I'd like to return to maybe a bit of the substance of what we're debating: public transit. The Conference Board of Canada 2010 report, Dispelling the Myths, talked about P3s, saying that they had certain “efficiency drivers”. However, governments continue to treat them in an ideological way by claiming that they save taxpayers money, sometimes even claiming that they cost the taxpayer nothing through such discredited practices as off-book accounting.

Can you outline how P3 projects--maybe specific to transit--sometimes are more costly to the taxpayer and can actually decrease economic activity?

[Paul Moist]

Thank you.

It was your colleagues in the United Kingdom, in the 2008 parliamentary report of the transport committee, who said, about the London Underground: “Whether or not the Metronet failure was primarily the fault of the particular companies involved, we are inclined to the view that the model itself was flawed and probably inferior to traditional public-sector management”.

There are auditors general across Canada, including the federal Auditor General, who at times have commented upon the so-called public-private partnerships. There is a legitimate role for the private sector to help us build Canada's public sector. That's where the work belongs: it belongs in the hands of the private sector. But when we start mortgaging debt at terrible prices compared to what we could manage that debt at ourselves.... Mr. McGuinty was elected for the first time in 2003. He said he was going to take to court the whole deal around Highway 407 in Toronto. He found out that it's locked down for 90 years. He's not able to undo that deal. He says he'll never make that mistake again.

History and countries around the world, including this country, are replete with examples. Mortgaging debt at inflated costs is a bad move. The private sector assisting the public realm in building infrastructure is an appropriate move.

[Jamie Nicholls, NDP, Vaudreuil—Soulanges, QC]

Thank you.

That leads me to my second question.

You mentioned that under tough economic times one of the weaknesses of P3 procurement is the difficulty of finding private partners willing to make negotiations that are favourable to the public's interest. It's sort of the idea that the private partner looks at it as how beggars can't be choosers, and the public partner might make an unfavourable negotiation. You can look at examples such as twinning the Port Mann Bridge, where the private bidder walked away and the public ended up saving $200 million through public financing of that project.

In comparing P3 and public procurement, what's the method of determining the savings that can come to taxpayers? Secondly, can you outline examples of savings to taxpayers through public sector procurement and service provision?

[Toby Sanger]

One of the major sources of savings is simply the lower costs of financing through public procurement and financing--i.e., not P3s. Over the 30 or 40 years that these might be amortized those 100 or 200 basis points can be a really substantial amount. Unfortunately, a lot of the value-for-money studies that are done by provincial governments really obfuscate the information. They present just a few pages of information. It's really not transparent. Unfortunately, that lack of transparency about the costing is endemic to P3 projects as well, because the public just does not have access to that information, which is often protected by commercial confidentiality and thousands of pages of legal contracts.

[Jamie Nicholls, NDP, Vaudreuil—Soulanges, QC]

I just have one more question. When the Vancouver system transferred from B.C. Transit to Coast Mountain, I believe the rights of the CAW were transferred. I think one of the members across, Mr. Watson, might have been a member of CAW at one point. We see that through P3 sometimes the union rights are transferred. In late 2007, I think, Montreal transit drivers of CUPE 1983 were upset about privatization pressures. During the same period, TransLink and Coast Mountain in October 2008got B.C.'s top employer award. The Vancouver example shows that when governments advance in good faith, union rights can be transferred in these negotiations, even when the agency running it might be contracted to private partners. However, in bad faith, bad things can happen.

Could you outline what the locals’ concerns were vis-à-vis privatization pressures in Montreal's transit provision?

[The Chair, Conservative, Merv Tweed]

Very briefly, if you could.

[Paul Moist]

I couldn't speak with any authority on that.

All over Canada we have had debates, and our goal here today is not to represent union members' interests, it's to talk about what kind of system we need for Canada. I'm old-fashioned. I'm from the prairies. I don't think we should spend any more money than we need to, to build Canada.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Poilievre.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

If you are going to come before a parliamentary committee and ask for billions of dollars in spending, it's perfectly reasonable for us to ask you how you're going to pay for it. So your suggestion earlier that our line of questioning had nothing to do with the subject at hand is in fact wrong. We do have the right to ask these questions.

If you're going to take one cent of the GST, there are only two ways to do that. You can raise the GST, which we oppose, or you can use the equivalent amount from general revenues, which also come from taxation. At the end of the day, there's no free money. I'm still waiting for you to explain how we're going to pay for this increase in spending that you're proposing today.

[Paul Moist]

We've tried to answer that. We would make different spending priorities within existing allocations. We would make revisions to the tax code to apply a fairer tax system. We would end the capital gains windfall that some Canadians enjoy. We would make tax moves that would free up capital for public investments that mayors and councillors are clamouring for from across Canada. These are all choices.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Do your members have a pension plan?

[Paul Moist]

Most CUPE members--not all, but most--participate in pension plans across Canada.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

I suspect that those pension plans are almost universally invested in the capital markets.