In addition to the benefits associated with P3s, there are several concerns that underline the need to proceed cautiously with P3s. These concerns can include the following (depending on the nature of the project, and the form of the P3 model):
| Potential Concern | Description |
| Higher costs | Financing costs for the private sector participant tend to be higher than the financing available to The City when viewed in isolation of the risks retained and/or transferred by the City. |
| Long term commitment | P3s can create a long term liability to The City, thereby reducing The City's debt capacity. Borrowing bylaws may be needed for P3s. |
| Reduced control/flexibility | Scope changes become costly, reducing The City's flexibility as the project proceeds. P3s can fail when the public sector participant changes the scope. |
| Resistance to private sector participation | There may be considerable resistance to private sector participation in the provision of traditional public services. |
| Reliability of operator | There may be concerns with the loss of control over the private sector operator in terms of changes to the ownership and/or the operations or a loss of control in the setting of fees. |
| Employee displacement | P3s may displace public sector workers. |
| Potential for conflict | Any contract that has performance incentives and/or penalties can result in disputes of whether these provisions are triggered. |
| Accounting Treatment | As public sector entities in Canada move to update their accounting practices to PSAB compliant, there is the need to reflect the true extent of all potential liabilities on the balance sheet, and whether they are tax supported or not, which will depend on the specific details and structure of the project itself. |
| Evaluation Process | Evaluations require a significant dedication of resources and are very time consuming. |
Most of these concerns can be mitigated by carefully structuring and monitoring the contract. There is also a trade-off between the concerns raised and the benefits outlined above. This underlines the need to carefully evaluate and structure any P3 to ensure that the benefits from the arrangement outweigh all concerns and costs.