Madam Speaker, I will be splitting my time with the member for Edmonton Strathcona.
Today we are debating the government's proposal for a Canada infrastructure bank. In particular, today's NDP motion asks the House to remove the clauses concerning the Canada infrastructure bank from Bill C-44, the budget implementation act, so they can be studied as a stand-alone bill.
I would like to start with a short history of the proposal and then move on to some of the concerns I have about the infrastructure bank.
In the 2015 election, the Liberal platform stated that it would:
...establish the Canadian Infrastructure Bank to provide low-cost financing for new infrastructure projects. The federal government can use its strong credit rating and lending authority to make it easier and more affordable for municipalities to build the projects their communities need.
This was not one of those high-profile promises, like electoral reform, which the Liberals have since broken, and it seems to be an entirely reasonable promise to make: using public money wisely to build and maintain public infrastructure.
Unfortunately, the plan has changed radically. In the latest budget, the government reveals that the infrastructure bank will involve $35 billion, $15 billion of which is public money. The rest will come from private investment banks and funds that expect a sizable return on their investments and a real say in the priorities of where that money is invested.
Do we need such a private infrastructure bank in Canada? Do we need to pay more for infrastructure projects? Do we need to pay tolls and extra fees? Do we need to give up the planning control of where our money is spent on public infrastructure?
According to a study by researchers at the Institute of Fiscal Studies and Democracy, the federal government could build even more infrastructure simply by borrowing at preferred rates and then passing the savings on to cities and provinces. That was exactly what the Liberals promised in the last election.
The government seems to be doing this for only one reason, and that is to take the credit for infrastructure projects it has had little or nothing to do with, projects that will profit wealthy investment bankers, projects funded by taxpayers paying extra tolls and fees, all the while taking the costs off government books so its fiscal record looks better than it is.
I would like to look a little more closely at some of the concerns surrounding the Canada infrastructure bank proposal. First among these is that unnecessary added cost that it would bring to public infrastructure projects.
As the Liberals pointed out in their election promises, the federal government can use its strong credit rating to access funds to help provinces and municipalities move forward with infrastructure projects that will benefit all Canadians. Why bring in private investment firms that demand higher returns? The government is simply adding a middleman who wants a profit.
As we heard earlier in various speeches, the Liberal government recently commissioned a study by KPMG to look into the infrastructure bank idea. It obviously did not like the answers it got since it initially refused to release the report.
One of the points the report makes is that Canadians do not like paying extra fees and tolls for the use of public infrastructure, something that really should not come as a surprise, especially when those fees and tolls will not be paying back public monies used for the project, but instead paying for profits to investment bankers.
The report mentions the push back the government might get if we start charging fees for water use. It points out that private investors internationally have only taken on municipal water assets after the community has adopted full costing and metering of water use.
In my riding, water metering is already in effect in many communities, simply because water is a precious commodity in the dry interior of southern British Columbia and paying for use instead of per household is a strong incentive for water conservation. People are paying their own municipal governments, not a private corporation, for that water use. This example points to the fact that private investors are simply interested in making a profit rather than getting involved for the public good.
Every municipality has ongoing infrastructure maintenance and operating costs that they must bear every year. Small rural municipalities and regional districts already are struggling with per capita costs that are much higher than those in larger cities. It makes no sense to them to embrace an infrastructure bank that will inevitably cost their citizens even more in the long term. They need a federal government that will provide the funding they need in the form of grants or low interest loans, just as the Liberals promised in their election platform, not through a private infrastructure bank.
Small municipalities in rural Canada are also concerned that $15 billion have been taken out of the infrastructure pot and put in a bank that probably will not be that interested in funding small town projects.
In recent years, governments across the country have been undertaking public-private partnerships despite the obvious fiscal and control problems that come with them.
A couple of years ago, the auditor general in my home province of British Columbia found that provincial taxpayers were on the hook for about $31 million in extra interest rates on one project alone, the Fort St. John Hospital, representing the private equity in the project borrowed at an interest rate of 14.79%. This led one journalist to wonder if the B.C. Liberals had put the charge on their Visa card.
The amount that B.C. taxpayers pay every year for the extra interest costs of PPP projects has been calculated at $81 million.
I do not have time to go into all the other concerns about this proposal: concerns about the privatization of airports; concerns about the lack of public oversight, the lack of public input into the priorities of the infrastructure bank, the lack of public involvement in the board of the bank; concerns that the people who the Liberals are getting to design the system are the very people, wealthy investment bankers, who will benefit from it; and concerns about the rush to get this started. The jobs are already posted on the government website before the bill has been fully debated in the House, let alone passed through the House and Senate.
The KPMG study I mentioned earlier calls for careful study of the infrastructure bank proposal, but instead the government is trying to rush this through with only two hours of committee hearings. We all know what can be done at a committee in two hours, maybe hear from six witnesses who have 10 minutes each to speak and answer a few questions. This is entirely inadequate to cover the myriad of concerns about this proposal.
We are talking about a lot of money, $35 billion. The Liberals might point out that it is merely the amount of the annual budget deficit, but to Canadians it is a big number, especially with the extra tolls and fees they will be paying to fund this investment. The minister has said, “We are not hearing concerns from [those on] whose behalf we are doing this.” We are doing this on behalf of the citizens of Canada and I am hearing concerns from my constituents. I am left to wonder who the minister has been listening to and who he thinks we are doing this for.
We in the NDP feel the Canada infrastructure bank proposal needs to be taken out of Bill C-44 and thoroughly studied as a separate stand-alone bill. That way Canadians can provide some input into a major change in government policy, a change that will unnecessarily cost Canadian taxpayers a great deal of money, while at the same time giving up public oversight into how that public money is spent and which public infrastructure projects move forward.