Originally published in Blakes Bulletin on Infrastructure, November 2007
On October 11, the Government of Québec unveiled the Québec Infrastructure Plan (the Plan), which provides for CAD 29.7 billion in investments for public infrastructure over the next five years. As a framework for such investments, the President of the Conseil du trésor tabled An Act to promote rigorous management of public infrastructures and large projects (Bill 32) in the National Assembly on October 30. The investments will, for the most part, be used to modernize and repair roads, hospitals, schools and municipal infrastructure. Funds will also be allocated to public transit, public housing, public security, culture and research.
CAD 30 Billion For Infrastructure
By investing in the Plan, the Government of Québec hopes to eliminate the public infrastructure maintenance deficit accumulated over the past decades. Within the next 15 years, the government anticipates being on par with the rest of Canada and the United States in this respect. Investments of CAD 23.4 billion will be used to renovate assets and bring them up to acceptable standards. Another CAD 6.3 billion will be invested in improving and replacing infrastructure. In addition, CAD 7.6 billion has been budgeted to complete existing projects. The bulk of expenses will go to the transportation (CAD 11.8 billion), health (CAD 7.1 billion), education (CAD 5.6 billion) and municipal infrastructure (CAD 3.15 billion) sectors.
Projects financed with the allocated funds will be announced by the Ministers responsible for the relevant sectors. On October 31, the Minister of Health indicated that approximately 2,600 buildings within the health care system will be renovated and modernized thanks to CAD 4.6 billion in financing. The remaining CAD 2.5 billion will be used to finance existing projects, such as the Centre hospitalier de l’Université de Montréal (CHUM), the McGill University Health Centre (MUHC), the Sainte-Justine University Hospital Centre and the Centre hospitalier universitaire de Sherbrooke (CHUS). On November 2, the Minister of Municipal Affairs and Regions announced investments of CAD 1.2 billion to improve water treatment and purification facilities and a further CAD 1.95 billion will be used to renovate other municipal assets.
The purpose of Bill 32 is to promote the development and proper maintenance of public infrastructure and to require future governments to invest in such assets in order to eliminate the maintenance deficit within 15 years. The Conseil du trésor would be called upon to submit to the government, on an annual basis, a capital budget for public infrastructures extending over several years and specifying the amounts allocated to each of the three following objectives: (1) maintenance of existing infrastructures, (2) elimination of the maintenance deficit within 15 years, and (3) improvement or replacement of infrastructure. Under Bill 32, the President of the Conseil du trésor or the Minister responsible for a public body may later request that such public body provide all information deemed necessary to establish the capital budget and an annual report detailing how the allocated amounts will be used. Finally, the capital budget and the annual report would be tabled by the chair of the Conseil du trésor in the National Assembly for review.
Bill 32 also provides a governance framework for large-scale projects in order to reduce cost overrun risks and delays in project completion. To that end, the quality of such projects must be reviewed independently. Accordingly, a ministry or other public body considering a large-scale project (any project valued at CAD 40 million or more) must evaluate such project together with the Agence des partenariats public-privé du Québec (the Agency), which will assess the quality of the business case and make recommendations on the preferred approach. If a project is not carried out as a public-private partnership (P3), a committee of independent experts shall be responsible for providing an opinion and making recommendations on the business case.
The Government of Québec’s new approach is similar to the one adopted by the Government of British Columbia, whereby any infrastructure project of CAD 20 million or more must be reviewed to determine whether it should be completed under a P3 model or in the traditional fashion. The role of the Agency, which was established in 2005, includes advising public bodies on the feasibility of P3 projects, assisting them in selecting partners and negotiating, entering into and managing the contractual framework of P3 projects. By providing advice and expertise, the mandate of the Agency is to assist in renewing public infrastructures and improving the quality of public services through P3 projects.
The investments and Bill 32 mentioned above have been favourably received by most of the principal actors, including municipalities, school boards or groups of professionals such as the Réseau des ingénieurs du Québec. The government will require the support of at least one of the opposition parties in order to have Bill 32 passed into law in the National Assembly.
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