It all began in November 2006, when the concept of developing an office to promote PPPs was first introduced in Advantage Canada, the long-term economic plan of the government of Canada.
By the time the idea made it through the budgeting process and PPP Canada was officially incorporated (February 2008) and opened for business (September 2009) the Canadian economy had dipped into recession and infrastructure spending was emerging as a major cure for the malaise.
McBride cautions this was merely coincidence, not causality.
"It wasn't related to the economic crisis," he says. "It was driven in the first instance by the desire to invest in infrastructure for the well being of Canadians, not originally as a stimulus plan."
PPP Canada is nevertheless contributing to economic development and growth through the commitment of its PPP Canada Fund, a $1.257 billion pot of money aimed at stimulating infrastructure development by complementing municipal and provincial resources for PPP projects.
"The experience of other countries, the UK and Australia, were very instructive," he says. "But I think we're at the stage now where we've adapted them to our context" |
It's a first-of-its kind fund at the federal level. And its timing could not be better. In Canada, PPPs tend to be structured as availability payment projects. Under this form of financing, governments reimburse private developers for their construction costs once the infrastructure project they've been hired for is substantially complete. They then get an ongoing stream of payments for a fxed period, typically between 20 and 30 years, so long as they keep the project available in good condition to the public. All of this, of course, takes money - money which, thanks to increasingly tight fscal circumstances, is increasingly scarce.