2018 Ontario Provincial Election Discussion

[SkyGod]

Financing costs are not the only costs included in procurement projects. Get it?

What advantage does bringing private capital to the table provide? You can get all the advantages of integrated project delivery without involving private financing.

 

[SkyGod]

That's PFI, not PPP. Keep digging...

PFI (Private Finance Initiative)/PPP (Public Private Partnerships) and...
https://www.lexisnexis.com/.../PFI (Private Finance Initiative)/PPP (Pu...
'PFI' stands for 'Private Finance Initiative' and 'PPP' and 'P3s' are both shorthand for 'Public Private Partnerships'. PFI and PPP both have very similar characteristics, the key difference being the way in which the relevant project is funded.

Read the 2nd part of my post:

If the idea is that the Feds are borrowing money on behalf of municipalities or others to get a lower interest rate...that makes sense. But that isn't what is being proposed:

Ottawa also expects the Infrastructure Bank to be operational by the end of the year, staffed with a chief executive officer and board of directors. The bank is aimed at combining public and private funds for big-ticket projects, to speed construction, and take advantage of institutional investors’ asset management and development expertise.

http://www.theglobeandmail.com/repo...-cash-in-infrastructure-push/article34392164/

They want private capital, which is more expensive than public.

 

[ADRM]

What advantage does bringing private capital to the table provide? You can get all the advantages of integrated project delivery without involving private financing.

There is a litany of academic research and media reporting available outlining cost-benefit analyses of P3s, much of it easily Googleable, but this isn't really the thread on which to continue litigating that.

 

[SkyGod]

There is a litany of academic research and media reporting available outlining cost-benefit analyses of P3s, much of it easily Googleable, but this isn't really the thread on which to continue litigating that.

You can do a P3 without private financing. That is my point. Design, build, operate, maintain contract.

 

[steveintoronto]

If the idea is that the Feds are borrowing money on behalf of municipalities or others to get a lower interest rate...that makes sense. But that isn't what is being proposed:

It isn't. You keep posting strawman arguments. I suggest you read the links I've already provided, it would save you from appearing ever more bereft of the terms you keep tossing around.

Some PPPs have been disasters. So have some aircraft designs, the challenge is to design them right.

Edit to Add: Segway planes and PPP into this:
https://www.thestar.com/news/canada...nership-change-can-fuel-regional-transit.html

And then consider how the QP Libs are going to have to take a hint from this. If the present cohort of Con bots aren't capable of anything but miming mantras, then Wynne does stand a much better chance of re-election, albeit I still contest her being the right one to lead the Libs to re-election.
Wynne's 'go-bold' re-election strategy: Hepburn

 

[steveintoronto]

You can do a P3 without private financing. That is my point. Design, build, operate, maintain contract.

And now you're sounding like a Soviet Progrom.

 

[SkyGod]

It isn't. You keep posting strawman arguments. I suggest you read the links I've already provided, it would save you from appearing ever more bereft of the terms you keep tossing around.

Some PPPs have been disasters. So have some aircraft designs, the challenge is to design them right.

How much clearer can the infrastructure minister be?

“The Trudeau government is trying to dispel fears about its plan to tap some of the world's wealthiest institutional investors to help fund infrastructure projects in Canada.”

“Such fears have been raised repeatedly since the federal government announced its intention to create an infrastructure bank, aimed at leveraging $4-5 in private-sector funding for every $1 in government funding.

And they intensifed in the wake of Prime Minister Justin Trudeau's summit Monday with some of the most powerful institutional investors in the world, representing a combined capital pool worth $21 trillion. He also met with some of Canada's largest investors, including insurance companies, the big banks and pension funds.

"If foreign billionaires loan the Canadian government money for bridges, hospitals and schools, they are not going to do it out of the goodness of their hearts," interim Conservative leader Rona Ambrose told the House of Commons on Tuesday.”

http://www.ctvnews.ca/politics/sohi...investment-in-public-infrastructure-1.3162794

The article you posted is a report that says the government SHOULDN'T include private financing. But they are. They have made that clear on multiple occasions.

 

[steveintoronto]

You exactly make my point by miming Ambrose' nonsense claim:

"If foreign billionaires loan the Canadian government money for bridges, hospitals and schools, they are not going to do it out of the goodness of their hearts," interim Conservative leader Rona Ambrose told the House of Commons on Tuesday.”

They don't "loan money"...the Gov't underwrites the money at the best rates possible to borrow as part of their minority share of the funding.

Ambrose is wrong! And you blindly blather her baloney. And she's a genius compared to Brown. Nothing personal against Brown, but I wouldn't let him drive my sister home from school, let alone lead a province.

I suggest you read some of the links I've posted.

Meantime, you'd best brush up on whatever political position it is that you're trying to espouse:

Harper launches new $14-billion infrastructure program


Gordon Isfeld | February 13, 2014 5:37 PM ET
OTTAWA — The Conservative government has added the long-awaited fuel needed to generate its new marquee infrastructure program.

For cities and municipalities across Canada, the new Building Canada Fund will pile $14-billion over 10 years into sorely needed new and upgraded construction projects.

“This will allow those whose job it is to make infrastructure decisions to plan those decisions with assurance over the long term,” Prime Minister Stephen Harper on Thursday at a community centre in Gormley, Ont., north of Toronto.

The new Building Canada Fund, originally announced in the 2013 budget, will replace a similar seven-year program that expires on March 31, Ottawa’s fiscal year-end.

The fund will function alongside other 10-year infrastructure initiatives for national, provincial-territorial, municipal and First Nations projects — under the umbrella of the new $53-billion Building Canada Plan. [...]

http://business.financialpost.com/news/harper-launches-new-14-billion-infrastructure-program

Be sure to send a 'Memo to Ronalee Chapchuk Ambrose'...the new Country Music jingle in Alberta...as a follow-on ditty to that resounding Canadian hit: 'Action Canada'.

And for the record, there were problems with Harper's debacle, all of his debacles actually, and the Investment Bank ostensibly will address many of them. Not that many "conservatives" would get it. It interferes with their knees knocking together.

 

[SkyGod]

It amazes me that you don't understand this.

The Liberals plan to finance the bank with $35 billion — $15 billion of it in cash — to backstop projects and attract private investment for those that can generate revenue through transit fares, water rates or road tolls.

The hope is that the federal money will generate $140 billion in private investment, particularly from pension plans looking for steady, predictable returns that will also keep up with inflation.

A study released Monday from the Canadian Centre for Policy Alternatives suggests the bank will cost Canadians more over the long term. In it, economist Toby Sanger argues that much depends on interest rates: The federal government can borrow at rates below 2.5 per cent, while private investors want returns of seven to nine per cent.

Based on Sanger’s calculations, Canadians could end up footing the bill for an extra $150 billion in financing costs on the $140 billion in infrastructure investments the government hopes to see come out of the bank.

https://www.thestar.com/news/canada...o-infrastructure-bank-projects-documents.html

There are arguments for and against private sector funding in infrastructure. It is certainly an interesting debate.

But you are saying that the Liberals aren't proposing private sector funding in infrastructure. That is an insane argument because everybody from Trudeau down has said that they are. How elese do you explain these quotes? It doesn't mean it's a bad plan (there are arguments both ways), but it is 100% what they are proposing. Ontario has already done tons of P3 projects with private sector financing. The AG did a report on them if you're interested.

 

[steveintoronto]

It amazes me that you don't understand this.

I do, been quoted and debunked in the VIA Rail string. You're all over the map, that's a left of centre org basing their views on the model that I quoted above, Harper's Bizarre.

In the Investment Bank, various factors can merge for the *sharing of risk* for *shared benefit*! Where this sub-string started was on "taxpayer's investment" and how that relates to blocking any more blindly-willed investment into SSE from the Fed coffers, and hopefully, by default, Queen's Park funding too, since the province and Feds match their funding amounts.

Duguid besides, Wynne would be wise to start addressing the wider Scarberial voting bloc by promoting the plan that benefits most, by far, already fully funded by QP and ready to go, and stating the obvious honest truth: (gist) "The Feds are only in for $660,000 on the SSE, we're not prepared to go any more than to match that amount, we're also not committed, so we stand for the greater benefit of all of Scarborough, and will stand behind our prior LRT commitment to fully fund and promote a much more comprehensive, meaningful, and shovel ready project to see Sacarborough moving in the next five years".

"Bold"? You betcha, and affordable. (and if you read between the lines, there's an apology to Tory for leading him around by his polished Oxfords on expressway tolls and then neutering him)

 

[SkyGod]

You don't understand it if you think that private money isn't involved and that private investors have higher financing costs than the Federal government.

 

[steveintoronto]

private investors have higher financing costs than the Federal government

My God...most investors have their own money. That's why they invest. Some borrowed capital may be necessary, especially for the government's slice, in which case it, and any capital borrowed for investors for the project (with some exceptions) is borrowed at the Gov't's preferential rate. That's the downside for liability, just as CSBs are underwritten by the guv. If the markets go south, the Guv is on the hook. But since that scenario is so catastrophic (which is exactly why I mentioned Greece, I wasn't talking about the movie musical) we're all up Shitz Creek anyway. This is what went wrong with the privatization with the operations of London's tube lines. It was a *bad implementation* and BBD were up to their necks in that one. London Greater Council had to pick up the tab.

You know, it's all in the links I posted.

Liquidity



Managing Liquidity
To make sure we have sufficient cash on hand to meet current payments to plan members and readily acquire investments, we hold a small percentage of the plan's assets in unencumbered Canadian treasury bills. This level of liquidity supports our large asset base and addresses uncertainty in global credit and equity markets.

We report our actual liquidity position regularly to our board's Investment Committee and also test our position periodically through simulations of catastrophic events.

Benefits of Liquidity
Having cash on hand is vital for several reasons:

• It allows us to avoid selling high-quality long-term assets to meet short-term funding needs at inopportune times
• It gives us the ability to adjust our asset mix in response to market movements
• It enables us to invest in assets such as real estate, infrastructure, timberland and private equity that cannot be quickly monetized
• It means we can meet short-term, mark-to-market payments embedded in our derivative exposure

As a number of developed countries deleverage, public asset privatizations are likely to emerge and our liquidity strategy will serve us well.

https://www.otpp.com/investments/performance/investment-strategy/liquidity

 

[SkyGod]

Yes, investors have their own money. Why would they invest in risky infrastructure projects for the same return as risk-free government bonds? They won't. Please note the bolded points which you didn't read:

The Liberals plan to finance the bank with $35 billion — $15 billion of it in cash — to backstop projects and attract private investment for those that can generate revenue through transit fares, water rates or road tolls.

The hope is that the federal money will generate $140 billion in private investment, particularly from pension plans looking for steady, predictable returns that will also keep up with inflation.

A study released Monday from the Canadian Centre for Policy Alternatives suggests the bank will cost Canadians more over the long term. In it, economist Toby Sanger argues that much depends on interest rates: The federal government can borrow at rates below 2.5 per cent, while private investors want returns of seven to nine per cent.

Based on Sanger’s calculations, Canadians could end up footing the bill for an extra $150 billion in financing costs on the $140 billion in infrastructure investments the government hopes to see come out of the bank.

At least you finally admitted that the Libs are asking for financing from the private sector.

 

[steveintoronto]

The Libs *ARE NOT* "looking for financing! They are looking for shared investment.

The Liberals plan to finance the bank with $35 billion — $15 billion of it in cash — to backstop projects and attract private investment for those that can generate revenue through transit fares, water rates or road tolls.

The investors aren't paid by taxpayers, they are paid by users.

In case you don't understand what "backstop" means, it's the same as "underwrite".

I feel like I'm arguing with Patrick Brown...

 

[Juan_Lennon416]

..and SkyGod is arguing with Kathleen Wynne