Abbotsford private hospital could be more costly — Parks’ review

News release

HEU calls on Campbell government to build it public, build it now

A privately owned and financed hospital for Abbotsford could result in a much more costly alternative than a traditional publicly owned and financed facility, forensic accountant Ron Parks concludes in his review of a controversial $250,000 government health care privatization study.

    Links to thesupporting documentation follow this release
Commissioned by the Hospital Employees’ Union (CUPE) and released today at a Vancouver media conference, Parks’ review also warns that the privatization study prepared for Victoria by consulting firm PricewaterhouseCoopers relies on “suspect data”, is inconclusive and “should not be used as the basis for a definitive government decision,” on how to proceed with the project to replace Abbotsford’s aging MSA hospital.

“If Victoria wants to pursue a private-public partnership (P3) policy for health care or public infrastructure projects,” says Parks, “it definitely has a lot more homework to do.”

HEU is urging the Campbell Liberals to heed Parks’ findings and move quickly to meet the health care needs of Fraser Valley residents. “Our message to the Premier is very clear,” says union spokesperson Chris Allnutt. “The hospital should be built public, and it should be built now.”

In his review of the financial comparisons between a P3 private hospital and a traditional publicly financed and owned facility, Parks confirms the small costs savings projected by PWC (about $2.6 million dollars on a $300 million plus project—less than one per cent over 30 years). But, says Parks, that may be the very best possible outcome. He notes an array of other costs that haven’t been factored in to pricing the private option, and is clear that even minor changes in the many variables in the financial modeling could lead to a more costly project than a traditional public one.

Other findings include:

  • the PWC study may have been working towards “a preconceived conclusion rather than undertaking an unbiased evaluation”;
  • with private sector involvement, there’s a need for stringent oversight and accountability measures, but the “appropriate oversight infrastructure is not in place”;
  • there are questions regarding the degree of risk transfer to the private sector — which is a key requirement of P3 projects;
  • there has been inadequate public consultation.
Concerned about the veil of secrecy surrounding the seven-month PWC report, HEU hired the highly respected Parks and his Calgary-based colleague Derek Malcolm in early April to review the multinational consultant’s study, and to provide independent and unbiased analysis.

Last October, HEU exposed the Campbell government’s efforts to turn the hospital replacement project into a so-called private-public partnership. And in March of this year, the union also forced the Fraser Health Authority to make the PWC report public.

For the webcast of our press conference releasing the Ron Parks review Click here

Links to the Park’s review along with supporting documents available in the media kit follow. These documents are in .pdf format and require Adobe Acrobat reader which may be dowloaded free from Adobe.com

Ron Parks Review Appendix Credentials - Ron Parks Credentials - Derek Malcolm HEU Backgrounder: Private hospital in Abbotsford opposed by 71 per cent... HEU Backgrounder: Abbotsford Hospital chronology of events

-30- Contact: Ron Parks, Kroll Lindquist Avey 604-683-3180; Stephen Howard, HEU communications director, 604-240-8524