Money in the bank
This week, Canadian Finance Minister Bill Morneau confirmed that the government will be seeking private sector collaboration to develop new projects through the proposed federal infrastructure bank.
Morneau said that through the bank, the government will work with the private sector to ensure that public dollars go further and that the plans deliver long-term success to the country’s pipeline and economy.
He emphasized that collaboration with all levels of government will be essential to the plan to spur long-term growth through infrastructure investments. But he particularly highlighted the work that can be achieved through the private sector and municipalities.
And he is not the first high-ranking politician to make these claims. Infrastructure Minister Amarjeet Sohi also backed a role for P3s in the plans the previous week when speaking at the National Conference for the Canadian Council of PPPs.
This is reassuring news for the market, which had been unsure as to the exact role of this bank since it was first mooted by the Liberals last year. Fears emerged that this was designed to rival the role of P3 and court the pension funds to an extent that would marginalize some of the investors that have built the Canadian pipeline to what it now is.
However, this looks to be wide of the mark. Obviously, it is early days and these promises from central government will need to be put into practice, but it is looking good for the market.
“We have been given the assurances that existing investors will have a role to play,” one source told P3 Bulletin this week. If that is the case, having new ways to access alternative financing that involves the private sector will only make the Canadian market stronger.
Not only will the market now have the might and experience of the regional procurement agencies, but also a route for additional financing coming from the top that can filter knowledge and opportunities down to lower levels of government.
It is also a positive step to see the Liberals stamping their own methods on the market and if this bank is successful, the opportunities are plain to see.
Streamlining the role of P3s alongside the role of the pension funds will be the key challenge to delivering on these promises – something that will be interesting to see over the coming months. But should this be achieved, Canada is primed for even more growth in the new year.
A more detailed look at the role of the infrastructure bank will feature in the upcoming edition of P3 Bulletin, out next month.