ANTIGONISH: A Canadian Centre for Policy Alternatives (CCPA) Research Associate says using a public private partnership (P3) model for the Highway 104 twinning project could potentially end up costing $119.2 million in unnecessary additional costs.
“An examination indicates that it might cost $66.6 million more in interest payments than it would cost to finance the project through government bonds,” Christopher Majka, the author of the recently released report called “Highway Robbery: Public Private Partnerships and Nova Scotia Highways” said. “Also the construction costs of the project as a P3, announced as $285 million, are $52.6 million more than highway construction costs that government currently pays for constructing identical lengths of twinned highway through normal government procurement.”
The town hall, which was hosted by Canadian Union of Public Employees (CUPE) Local 1867 and the Nova Scotia Highway Workers’ Union featured Majka, along with CUPE Atlantic Researcher Govind Rao, Leanna Braid, an Antigonish resident, and New Brunswick highway worker Joey Kelly, as panelists speaking on their individual concerns with the P3 model.
“The provincial government wants to hand over ownership and operation of the new stretch of highway to a private, for-profit corporation,” Steve Joy, president of Nova Scotia Highway Workers’ Union, CUPE 1867 said in a media release. “But we’re paying 67 per cent more for a private highway, with poorer contracted-out winter road maintenance.”
Rao told the nearly 75 people in attendance the town hall was about presenting information about what they felt were downsides to the P3 model which included safety and local control over the public infrastructure. The meeting also provided an opportunity for community members to have their say and voice their opinions.
“For me there are three topics that draw my concern. First safety is the overwhelming issue – we need to improve the safety along that stretch of highway,” he said. “Second is control and accountability, if maintenance and snow removal is poor – what are our options? And finally the cost, can we get more kilometers twinned and maintained safely if it was a public project?”
Rao questioned why the 104 twinning project is the only current expansion project using the P3 model as the Highways 101, 103 and 107 projects are using the traditional public procurement.
“We could have a safer, longer stretch, and more quickly built public highway if the government would finance and build the highway in the traditional way we have always been building highways in the province.”
A highway twinning study by CBCL in 2016 examined the proposed twinning of the section from Sutherland’s River and Antigonish and it was calculated the proposed per kilometer cost, including construction and the purchase of land and water rights was $6,125,291 for a total cost of $232.4 million for this 38 kilometer stretch of highway.
However, the Nova Scotia Government has said that it anticipates the cost of the project as a P3 contract will be $284 million, resulting in a per kilometer increase of 22.6 per cent.
As a way to “sweeten the pot” for the successful contractor to undertake the project, Majka indicated the company is going to receive an extra 26 kilometers of road that is already being maintained by public workers.
“The government proposes that the P3 consortium undertake not only the maintenance of the new section of highway, but also of 9.3 kilometers of existing divided highway between East River Road and Exit 27,” Majka said. “And for the recently completed 16 kilometer Antigonish by-pass. Thus a total of 63 kilometers of highway would be bundled into the contract.”
After a short discussion with the attending community members, the only question left unanswered was why the province made the decision to go the route of a P3 model.