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South Okanagan Photos

Think piece

What do you think of P3’s – Public/Private Partnerships?

The government of BC (Ministry of Finance) has issued the results of a study that outlines 19 recommendations for change – some major. All have been accepted by the government.

Is there something wrong in the way P3’s have been run to date?

 

A government review of Partnerships BC concludes that the organization’s mandate is clear and being fulfilled, and makes recommendation to further strengthen the provincial Crown corporation.

The review found Partnerships BC has designed a robust process to help assess value for money of public private partnership (P3) capital projects, and that compensation and operating expenses appear reasonable and generally consistent with government direction.

The Crown review report provides recommendations to government to further strengthen the provincial Crown and government’s management of P3 capital projects, including a review of the screening threshold for capital projects.

An executive steering committee comprised of government and industry representatives also reviewed Partnerships BC’s service delivery model and made several recommendations on implementing the Crown review recommendations. As a result of the steering committee’s recommendations, the capital standard threshold for P3 projects will be increased from the current $50 million to $100 million. This recognizes the significant resources required to participate in the P3 procurement process.

The B.C. government has accepted and will be implementing all recommendations from both the Crown review and the steering committee review.

Partnerships BC will continue to provide:

  • Business case development and procurement management services for provincially funded P3 projects.
  • Expertise in capital project governance for provincially funded major infrastructure projects.
  • Expertise, knowledge, tools and advice to government and public sector entities in regard to planning and procurement of major capital projects.

Since 2002, Partnerships BC has participated in more than 40 projects in British Columbia and other jurisdictions with an investment value of more than $17 billion, of which approximately $7 billion is private sector capital. Every project to date has been delivered on time and on budget, created thousands of jobs and generated significant investment opportunities.

Government undertook the Crown review of Partnerships BC to evaluate its effectiveness in facilitating and delivering partnership capital solutions in B.C. The review evaluated Partnerships BC’s governance, mandate, roles and service delivery model, performance, contracting practices, operating costs and the overall process for determining partnership capital solutions. As first announced in 2011, government is reviewing all Crown corporations.

What follows is 10 of the most serious recommendations:

 

  1. The Government of British Columbia should consider evaluating the screening threshold for capital projects.
  2. The Government of British Columbia should determine the most appropriate delivery model for each of the services that Partnerships BC provides.
  3. Project owners and Partnerships BC should ensure that the most likely alternative is selected as the benchmark when assessing value for money.
  4. Project owners and Partnerships BC should strengthen decision-making by ensuring that complete information is provided to Treasury Board.
  5. The Government of British Columbia should consider setting a minimum value for money threshold at the business case and procurement phases.
  6. Partnerships BC should increase transparency by ensuring that project owners fully understand the financial model and its assumptions.
  7. The Government of British Columbia should consider reinforcing to project owners that they are accountable for their projects.
  8. Project owners and Partnerships BC should strengthen decision-making by ensuring that the appropriate government agencies are formally involved.
  9. The Government of British Columbia should consider reinforcing the conflict of interest guidelines for board members of Crown corporations and government agencies and ensure that those guidelines are appropriately followed.
  10. Partnerships BC should ensure contractor files have adequate documents.