British columbia's capital asset management framework: Moving from transactional to transformative leadership on public-private partnerships, or a "railroad job"?

Canadian Public Administration

Volumn 51, Issue 1, 2008, Pages 71-97

  Cohn, Daniel ^a  

^a YORK UNIVERSITY   (Canada)

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EID: 48249118723     PISSN: 00084840     EISSN: None     Source Type: Journal    
DOI: 10.1111/j.1754-7121.2008.00005.x     Document Type: Article

References (109)

1. British Columbia, Office of the Premier, Guidelines for the Core Review (Victoria: Province of British Columbia, 2001);
2. P. Willcocks, "The Cutting Edge of Campbell's 'New Era,"' The Vancouver Sun, 3 July 2001, p. A10.
3. P. Vaillancourt Roseneau, "The Strengths and Weaknesses of Public-Private Policy Partnerships," in P. Vaillancourt Roseneau, ed., Public-Private Policy Partnerships (Cambridge: MIT Press, 2000), p. 219;
4. P. Brewer and L. Johnson, Partnering in Practice: New Approaches to PPP Delivery (n.p.: PricewaterhouseCoopers, 2004).
5. D. Cohn, "The public-private partnership 'fetish': Moving beyond the rhetoric," Revue Gouvernance 1, no. 2 (Fall 2004), p. 6.
6. n.a., "Editorial: Private-public partnerships will have twists and turns," Engineering News Records, 5 June 2002, p. 64;
7. A. Ribault, "Lessons from the French experience in public and private partnerships," Irish Banking Review (Spring 2001), pp. 49-61.
8. J.W. Kingdon, Agendas, Alternatives, and Public Policies (Boston: Little, Brown, 1984).
9. J.T.S. Keeler, "Opening the window for reform," Comparative Political Studies 25, no. 4 (January 1993), pp. 433-86.
10. J.V. Denhardt and K.B. Campbell, "The role of democratic values in transformational leadership," Administration and Society 38, no. 5 (November 2006), pp. 556-72.
11. An explanation for the linkage between P3s and the New Public Management is provided by C. Rouillard, E. Montpetit, I. Fortier and A-G. Gagnon, Reengineering the State: Toward an Impoverishment of Quebec Governance (Ottawa: University of Ottawa Press, 2006), pp. 76-9.
12. Cohn, "Public-private partnerships "fetish," Revue Gouvernance.
13. Partnerships BC, Project Report: Achieving Value for Money: The Abbotsford Regional Hospital and Cancer Centre. (Vancouver: Partnerships BC, 2005);
14. Greater Vancouver Transit Authority, News Release: Final TransLink Board Vote Approves RAV Line, 1 December 2004 (Burnaby: Greater Vancouver Transit Authority, 2004).
15. British Columbia, Ministry of Finance, Capital Asset Management Framework - Guidelines (Victoria: Province of British Columbia, 2002), available at http://www.fin.gov.bc.ca/tbs/camf_guidelines.pdf;
16. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview (Victoria: Province of British Columbia, 2002), available at http://www.fin.gov.bc.ca/tbs/camf_overview.pdf.
17. H. Enchin, "Platform for partnerships launched: Liberals create powerful quasi-governmental agency to encourage corporate cooperation," The Vancouver Sun, 31 May 2002, p. D5.
18. British Columbia, Ministry of Finance, Capital Assets Management Framework - Guidelines.
19. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview, p. 2.
20. See, for example, J. Sandier, "Bid to keep report secret foiled," The Vancouver Sun, 22 March 2002, p. B3;
21. B. McLintock, "Leaked notes outline cuts to health care," The Province [Vancouver], 5 March 2002, p. A4;
22. V. Palmer, "Liberals' redesign script stumbles over details," The Vancouver Sun, 24 April 2002, p. A22.
23. Evidence for this analysis is derived from government and quasi-governmental agency documents in the public record, newspapers indexed in the Canadian Newsstand and Canadian Periodical Index databases, and trade publications indexed in the Canadian Business and Current Affairs and ABI/Inform databases. These databases were searched using keywords related to the projects under study, as well as more general combinations including the names of key actors (both individuals and organizations) alongside of "public-private partnership," "PPP," "P3" and the plurals of these terms. Similar keywords were used to search interest group and think-tank documents on the web with Google and Yahoo, as well as Standard & Poor's various reports on credit markets.
24. Fraser Health Authority, Fraser Health Authority Strategic Plan (Surrey: Fraser Health Authority, 2005), p. 3.
25. Interviews were also conducted by the author with public- and private-sector executives in the summer and fall of 2005: From the Abbotsford Regional Hospital and Cancer Centre: Dr. David MacLean, Dean of Health Sciences, Simon Fraser University, and former board member, Fraser Health Authority; Mr. Brian Woods, vice-president, Corporate Services, and chief financial officer, Fraser Health Authority; and Mr. Mike Marasco, vice-president, Partnership Development, Partnerships BC, and project director, Abbotsford Regional Hospital and Cancer Centre. From the Richmond-Airport-Vancouver Rapid Transit Line: Ms. Jane Bird, president and CEO, RAVCO; and Mr. Doug MacCallum, mayor of Surrey, British Columbia, and chair, GVTA. From the Sea-to-Sky Highway Improvement Project: Mr. Peter Milburn, acting assistant deputy minister, Highways Department, Ministry of Transportation, and executive project director, Sea-to-Sky Highway Improvement Project; and Mr. Richard Fyfe, supervising solicitor, Ministry of the Attorney General, and procurement director, Sea-to-Sky Highway Improvement Project. From Partnerships BC: Mr. Larry Blain, president and CEO, Partnerships BC; Mr. Mike Marasco, vice-president, Partnerships Development, Partnerships BC, and project director, Abbotsford Regional Hospital and Cancer Centre; and Ms. Jennifer Davies, senior communications consultant, Partnerships BC. Private-sector executives interviewed: Mr. Nicolas Harm, managing director, Macquarie North America Limited; Mr. Mark Hodgson, managing director, Infrastructure Advisory Practice Vancouver, Deloitte (formerly with PricewaterhouseCoopers); and Ms. Jane Peatch, executive director, The Canadian Council for Public-Private Partnerships.
26. Professional Association of Residents British Columbia, Report on the Health Authorities' Health Services Redesign Plans (Vancouver: Professional Association of Residents British Columbia, 2002).
27. British Columbia, Ministry of Health Services. News Release: Government Honouring Promise for New Hospital, 23 January 2003 (Victoria: Province of British Columbia, 2003).
28. Canadian Council for Public-Private Partnerships, The Canadian Case for Hospital PPP Projects (Toronto: Canadian Council for Public-Private Partnerships, 2003), p. 29.
29. P.B. Calder, Approaches to Canadian Infrastructure Financing: Past, Present, and Future (Toronto: Standard & Poor's, 2004);
30. Macquarie North America, Report for the Greater Vancouver Transportation Authority [on using public-private partnerships to develop the Richmond-Airport-Vancouver rapid transit line and the new Fraser River crossing] Part 1 (Vancouver: Macquarie North America, 2001), pp. 4-5.
31. PricewaterhouseCoopers, Fraser Valley Health Centre/Eastern Fraser Valley Cancer Centre, Public-Private Partnership Review. Final Report (n.p.: PricewaterhouseCoopers, 2002).
32. PA. Grout, "Public and private discount rates in public-private partnerships," Economic Journal 113, no. 486 (March 2003), p. 63.
33. United Kingdom, Her Majesty's Treasury, PFI: Meeting the Investment Challenge (London: HMSO, 2003), p. 42;
34. S. Byers, "Full-text of Stephen Byers' speech: The former transport and local government secretary's speech to the Social Market Foundation in London today," Guardian Unlimited, 3 June 2003.
35. Partnerships BC, Project Report: Achieving Value for Money: The Abbotsford Regional Hospital and Cancer Centre.
36. R. Goldsworthy, "Objective-based government remains liberal target in B.C.," Journal of Commerce [Vancouver] 91, no. 92 (20 November 2002), retrieved from Canadian Business and Current Affairs database. I sent Mr. Gary Collins, finance minister from June 2001 to December 2004, a copy of the Goldsworthy article and gained his written confirmation that it accurately reflects his comments to the reporter.
37. T. Leslie, "Only one bidder left to build new hospital," Abbotsford Times, 10 February 2004, p. 7.
38. Partnerships BC, Project Report: Achieving Value for Money: The Abbotsford Regional Hospital and Cancer Centre.
39. Of all the critics of the Abbotsford Hospital, S. Murray provides one of the most reasoned and detailed analyses to date. See S. Murray, Value for Money? Cautionary Lessons about P3s from British Columbia (Vancouver: Canadian Centre for Policy Alternatives, 2006).
40. Those interested in a more detailed examination of the RAV Line as a public planning exercise and its outcome should look at M. Siemiatycki, "Implications of private-public partnerships on the development of urban public transit infrastructure: The case of Vancouver, Canada," Journal of Planning Education and Research 26, no. 2 (2006), pp. 137-51.
41. J. Lee Whalley, "Richmond ties announced: Transit to grow 'n' grow," The Vancouver Sun, 31 July 1989, p. A1.
42. Greater Vancouver Regional District, Livable Region Strategic Plan (Burnaby: Greater Vancouver Regional District, 1999), p. 12;
43. P. McMartin, "RAV Line follows the money," The Vancouver Sun, 29 May 2003, p. A4.
44. Canada Line Rapid Transit, Canada Line Final Project Report (Vancouver: Canada Line Rapid Transit, 2006), p. 2.
45. Macquarie North America, Report for the Greater Vancouver Transportation Authority (Vancouver: Macquarie North America, 2001).
46. The degree of independence possessed by the "independent" directors can be judged by the background of the RAVCO board chair and independent director, L.I. (Larry) Bell. There can be no doubt that Bell is a skilled and accomplished executive. However, his fate is closely tied to that of the government. Among the first major personnel decisions made by Premier Campbell was to sack the board of the provincial power utility, BC Hydro, and to appoint Bell as chair and CEO, a job he first held from 1987-91 under the Social Credit Party. In the 1980s, Bell had been among the small group who were close confidants of Social Credit Premier Bill Bennett. He also became a close adviser to Premier Campbell while Campbell was opposition leader and played a key role in his transition team. It should also be recalled that the present-day B.C. Liberals are a right-of-centre "anybody but the NDP" coalition that emerged when the coalition's previous electoral vehicle, the Social Credit Party, became tarnished in the minds of voters. See, for example, B. Lewis, "Hydro sparkplug recharged: Premier calls up high-powered executive to take over B.C. Hydro," The Province [Vancouver], 9 September 2001, p. A43;
47. and J. Hume, "Bill Bennett: An insider's view," Times-Colonist [Victoria], 16 April 2006, p. D5.
48. G. Campbell and K. Falcon, Letter to Chair Doug McCallum and Members of the Greater Vancouver Transit Authority Board. Issued with News Release 2004OTP0049-000492 ed. (Victoria: Office of the Premier of British Columbia, 2004);
49. Greater Vancouver Transit Authority, News Release: Rapid Transit Expansion, 30 June 2004 (Vancouver: Greater Vancouver Transit Authority, 2004);
50. J. Lee, "Victoria declares RAV Line dead, assails Translink board," The Vancouver Sun, 19 June 2004, p. A1;
51. C. Skelton, "RAV Line was short 'hundreds of millions': Project bids far higher than Translink budget," The Vancouver Sun, 10 May 2004, pp. A1-A2;
52. Canada Line Rapid Transit, Canada Line Final Project Report, p. 2.
53. Greater Vancouver Transit Authority, News Release: Final TransLink Board Vote Approves RAV Line, 1 December 2004 (Burnaby: Greater Vancouver Transit Authority, 2004);
54. P. Jacobsen and S. Plewes, "Memo to GVTA Board of Directors from Pat Jacobsen, Chief Executive Officer, and Sheri Plewes, Vice President Capital Management & Engineering: Richmond Airport Vancouver Project - Summary of Best and Final Offer Proposal Stage and Proceeding to Preferred Proponent Stage" [26 November 2004 for 1 December board meeting] (Burnaby: Greater Vancouver Transit Authority, 2004);
55. W. Boei, "RAV Line gets final approval: Construction to start in 2005," The Vancouver Sun, 2 December 2004, pp. Al, A4.
56. Canada Line Rapid Transit, Canada Line Final Project Report, pp. 17-18.
57. Ibid., p. 1.
58. B. Flyvbjerg, M.K. Skamris Holm and S.L. Buhl, "How (in)accurate are demand forecasts in public works projects: The case of transportation," Journal of the American Planning Association 71, no. 2 (Spring 2005), pp. 131-46.
59. P. Jacobsen, "Memo from Pat Jacobsen, CEO to the GVTA Board of Directors: Approval of Procurement Strategy and Funding Commitment for Richmond-Airport-Vancouver Rapid Transit" (Burnaby: Greater Vancouver Transit Authority, 2003).
60. Jacobsen and Plewes, "Memo to GVTA Board of Directors," p. 14;
61. W. Boei, "Contract protects taxpayers, Translink, RAVCO says: But taxpayers remain liable for ridership levels on the Transit Line, Chief Executive Larry Bell says," The Vancouver Sun, 20 November 2004, pp. El, E3.
62. Boei, "RAV Line gets final approval," The Vancouver Sun.
63. P.B. Calder, Research Update: Municipal Finance Authority of British Columbia 'AAA' Ratings Affirmed on Provincial Support (Toronto: Standard & Poor's, 2005). The Finance Authority issues debt on behalf of all of British Columbia's municipal governments. Given the role of the GVRD and GVTA, the debts they issue to finance capital projects make up a sizable component of the Authority's borrowing, and the GVRD's taxation power represents a key resource to the Authority.
64. M. Taylor et al., Building Better Partnerships: The Final Report of the Commission on Public Private Partnerships (London: Institute for Public Policy Research, 2001).
65. G.J. Hodgson, "Design and Build - Effects of Contractor Design on Highway Schemes," Civil Engineering 108, no. 2 (May 1995), pp. 64-76;
66. B. Flyvbjerg, N. Bruzelius and W. Rothengatter, Megaprojects and Risk: An Anatomy of Ambition (New York: Cambridge University Press, 2003);
67. United Kingdom, Her Majesty's Treasury, PFI: Meeting the Investment Challenge, pp. 3 and 46-8.
68. Murray, Value for Money? Cautionary Lessons about P3s from British Columbia, pp. 12 and 20-1.
69. P. Edwards, J. Shaoul, A. Stafford and L. Alabaster, Evaluating the Operation of PFI in Roads and Hospitals. Research Report No. 84 (London: Association of Chartered Certified Accountants, 2004);
70. n.a., "Trusts feel the impact as PFI and payment for results collide," Health Services Journal, 8 June 2006.
71. This in part explains why even with more traditional public procurements, interest is growing in using consortiums to develop so called design-build and design-build-finance "turn-key" projects. They are called by this name since all the public owner has to do once they take delivery for the infrastructure is "turn the key" to start them. As noted in the article, one interviewee indicated that the FHA would have preferred to adopt a turn-key approach, such as design-build for the Abbotsford Hospital rather than undertake a P3.
72. V. Palmer, "Liberals' pet 'P3' a long way from reality," The Vancouver Sun, 10 May 2002, p. A14.
73. Cohn, "Public-private partnerships 'fetish,'" Revue Gouvernance, pp. 8-9 and 14. Market actors are generally much better informed as to the particulars of a given deal than is widely understood by the public. One private-sector interviewee observed that even when important aspects of a project are kept confidential, rival firms can generally figure out the details of the winning proponent's proposal, soon after the competition closes.
74. Edwards, Shaoul, Stafford and Alabaster, Evaluating the Operation of PFI in Roads and Hospitals; n.a., "Trusts feel the impact as PFI and payment for results collide," Health Services Journal.
75. Lewis Auerbach "Memo to Barry O'Neill, President Canadian Union of Public Employees, BC Division Regarding the March 31st Letter from Ken Dobbel to Pat Jacobsen on Performance Payments for the RAVRT Project," 14 October 2004 (Vancouver: CUPE B.C. Division, 2004).
76. C. Fitzsimmons, "Public-private partnerships and the CA profession," Beyond Numbers (November 2002), available at http://www.ica.bc.ca/kb.php3?artid=1154.
77. Canadian Union of Public Employees, B.C. Division, The Drive to Privatize (Vancouver: CUPE, B.C. Division, 2006), available at http://www.cupe.bc.ca/index.php4?id=1027.
78. See, for example, J. Beatty and C. McInness, "Patients and students first," The Vancouver Sun, 26 January 2002, p. A1;
79. J. Bermingham, "Private health care firms met with bureaucrat," The Province [Vancouver], 26 June 2002, p. A19;
80. Health Services and Support - Facilities Subsector Bargaining Assn. v. British Columbia, 2007 S.C.C. 27.
81. J. Greenwood, "Teachers blame B.C. for botched road project," National Post, 25 July 2003, p. FP3;
82. J. Greenwood, 'Teachers put B.C. investing on hold," National Post, 15 May 2003, p. FP1.
83. S. Tafler, "BC+X = P3," Summit (September 2002), p. 17.
84. Goldsworthy, "Objective based government remains Liberal target in B.C.," Journal of Commerce [Vancouver].
85. D. Cohn, "Creating crises and avoiding blame: The politics of public sector reform and the new public management in Great Britain and the United States," Administration and Society 29, no. 5 (November 1997), p. 585;
86. British Columbia, Ministry of Finance, Capital Assets Management Framework-Overview.
87. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview; British Columbia Capital Assets Management Framework - Guidelines.
88. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview, p. 2.
89. British Columbia, Ministry of Finance, Capital Assets Management Framework - Guidelines.
90. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview.
91. Ibid.
92. D. Cohn, "Creating crises and avoiding blame," Administration and Society, pp. 597-98.
93. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview, p. 4;
94. P. Aucoin, The New Public Management: Canada in Comparative Perspective (Montreal: Institute for Research on Public Policy, 1995);
95. C. Hood, "A public management for all seasons?," Public Administration 69, no. 1 (Spring 1991), pp. 3-19;
96. D. Osborne and T. Gaebler, Reinventing Government: How the Entrepreneurial Spirit is Transforming the Public Sector (New York: Penguin, 1993);
97. D.P. Moynihan, "Managing for results in state government: Evaluating a decade of reform," Public Administration Review 66, no. 1 (January/February 2006), pp. 77-89.
98. British Columbia, Ministry of Finance, Capital Assets Management Framework - Overview.
99. Ibid., p. 5.
100. Ibid., p. 3.
101. Ibid., p. 6.
102. Canadian Union of Public Employees, B.C. Division, Fact Sheet: The Liberal Attack on the Public Delivery of Services (Vancouver: CUPE, B.C. Division, 2006), available at http://www.cupe.bc.ca/359.
103. Macquarie North America, Report for the Greater Vancouver Transportation Authority, p. 1.
104. Enchin, "Platform for partnerships launched," The Vancouver Sun.
105. British Columbia, Executive Council, Transcript of the Open Cabinet Meeting May 30, 2003 (Victoria: Province of British Columbia, 2003).
106. British Columbia, Ministry of Finance, Shareholder's Letter of Expectations between The Minister of Finance and the Chair of Partnerships British Columbia (Victoria: Province of British Columbia, 2003), p. 4.
107. Greater Vancouver Transit Authority, News Release: Final TransLink Board Vote Approves RAV Line; Jacobsen and Plewes, Memo to GVTA Board of Directors; Boei, "RAV Line gets final approval," The Vancouver Sun.
108. Greater Vancouver Regional District, Livable Region Strategic Plan.
109. See, for example, Flyvbjerg, Bruzelius and Rothengatter, Megaprojects and Risk.