P3s are more expensive, less accountable and of lower quality than public provision. There are a number of common misconceptions about P3s:


Myth: P3s are cheaper, because the private sector is more efficient.
Reality: Numerous examples prove that P3s are more expensive than public provision.

Governments can always borrow at a rate better than private enterprise, and do not need to retain a profit. The Confederation Bridge between New Brunswick and PEI was constructed as a P3, and Canada's Auditor General found that the P3 cost the public an extra $45 million. Nova Scotia's 55 P3 schools cost an estimated $32 million more than if they had been built publicly, and even TD Bank has stated that P3s are not a cheaper option.


Myth: In P3s, the private sector bears the risk.
Reality: P3s are a major risk for the public sector.

Private partners frequently default on loans or fail to meet benchmarks, and because the service is essential, the public has to provide bail-outs. Ottawa and Guelph have had to take over failed arena P3s at a cost of millions, and in California, a P3 highway deal was extended from 35 to 45 years because the private partner was not making its expected 18% return.


Myth: P3s are more efficient.
Reality: P3s result in delays and cost increases.

P3s are costly and time-consuming to evaluate. Calgary opened the $5.8 million Radisson Park School this year, announcing it as a success. Contract negotiations alone on that project took two years.

The province considered building Calgary's South Campus Health Centre as a P3, and the price tag has since risen to over $1 billion. In Edmonton, the City spent $1 million and a year to explore P3s for building a new transit garage, and the cost of the project has now risen from about $50 million to well over $90 million.


Myth: P3s provide quality service.
Reality: The private sector cuts corners and reduces quality.

The private sector will always try to reduce costs to maximize profit, and will be reluctant to perform costly maintenance.Hamilton's water services P3 was plagued by water quality issues and a major sewage spill, and the City ended the agreement in 2004. A national audit of 17 P3 schools in Britain found them to be of lower quality in terms of space, light, heating, acoustics and ventilation.


Myth: P3s are still responsible to the public.
Reality: P3s are not accountable or transparent.

P3s are bound by the disclosure rules of private enterprise, not public service. Municipalities in Quebec have had to resort to legal action to get access to information about their own P3s.

Even the information that is available is often not open to the public. The City of Edmonton is currently considering a recreation centre P3 proposal, but will not release the identity of the bidder, even to Council. Hamilton's water services P3 provided audited financial statements, but these could not be released to the public.

When independent consultants found the private partner in Hamilton's P3 to be responsible for a massive sewage spill, Hamilton had no way to enforce accountability, and the private sector was not forced to pay for the cost of damages.

P3s are simply not an effective or accountable mode of service delivery.

For more information, click below:

Economic Drawbacks to P3s

Cost and Quality: P3s Lead to Higher Costs and Lower Quality Than Public Service

Risks to the Public Partner: P3s Are Not a Low-Risk Option

P3s and the Public Interest

How P3s Erode Transparency and Accountability

Loss of Flexibility: P3s Reduce Public Control Over Services and Planning


Get Informed and Take Action

Current P3 Projects in Alberta: More Expensive, Less Effective