By Harland C. Lindsay, Director, Parkin Architects Limited
At the end of July, some 700 people representing architecture, engineering and construction, attended a marketing conference in the USA. In one session, I was one of about 30 people in a break-out room capable of holding over 100 people. A panel session was underway on Public Private Partnerships (P3s). The panel included legal, architectural and financial representation. The Panel session’s stated goal was to inform its audience about how Public Private Partnerships are faring in the current tough (U.S.) environment. It also purported to assist audience members with advice on how to break into the P3 process.
When I first heard of P3s in the late 1990s, I went to the UK, (where P3s are called Privately Financed Initiatives – PFIs), to find out what they entailed. I returned to Canada, convinced that P3s would soon manifest themselves here. I was right.
So, what have P3s done for Canada, the UK and Australia?
First, the politicians win as they can be seen to be promoting impressive new infrastructure without huge initial capital costs appearing on the books.
Second, public agencies win as they can shift a huge risk exposure to the private sector, ensuring that projects are built on time and on budget.
Third, P3s have inarguably permitted construction of much-needed infrastructure projects such as hospitals, justice and correctional facilities, transportation, communication and recreational facilities, thanks to infusions of private financing, maintenance and operations.
The fundamental question has always been, “Would you like to start saving now, so that you can afford to have your new facility built perhaps 40 years from now? Or would you like to mortgage your building, have it ready for use in a year or two and pay it off over the next 30 years?” Essentially, it is not unlike the buy-now-pay-later mortgage philosophy employed by 90% of Canadian homeowners.
As I sat in that room, it occurred to me that the other 670 conference attendees either knew all there is to know about P3s or, more likely, had no idea what a P3 is, nor the impact P3s are about to have on the U.S. design and building industries. P3s are poised to literally change the financial, political and physical landscape in the United States. If we act now, there is an opportunity for Canadians skilled in the P3 process to sell that expertise south of the border.