Private hospital schemes based on “pseudo-scientific mumbo-jumbo,” warns Britain’s top financial watchdog

News release

Findings similar to Ron Parks’ review of B.C. Liberal’s Abbotsford private hospital scheme

With the Campbell government expected to make a final decision on its controversial Abbotsford private hospital scheme within a month, the Hospital Employees’ Union (CUPE) says the Premier should heed new warnings from the British equivalent of B.C.’s Auditor General.

In a recently published report in the Financial Times of London, the head of Britain’s National Audit Office says government officials rely heavily on “spurious” financial data to determine whether proposals for privately owned and operated hospitals are cost effective.

Jeremy Colman, Britain’s auditor general and deputy controller, says that proponents of so-called private-public partnership (P3) infrastructure projects to build hospitals, schools and roads create cost comparisons with traditional public finance and operation that involve “pseudo-scientific mumbo jumbo where the financial modeling takes over from thinking.” It’s an exercise, Colman says, that “becomes so complicated that no one, not even experts really understand what’s going on.”

With the Campbell Liberals following Britain’s P3 playbook page for page, HEU spokesperson Chris Allnutt says “these are sobering findings that our own government would be wise to heed.”

He added that Colman’s conclusions are similar to the findings of Vancouver forensic accounting specialist Ron Parks who recently carried out an independent analysis of a government study that promoted a private hospital for Abbotsford.

Parks determined that the study—which was prepared for the Campbell Liberals by P3 proponents PricewaterhouseCoopers—was based on “suspect data” that “should not be used as the basis for a definitive government decision.”

Colman’s comments came as Britain’s finance ministry prepares to launch a review of how P3 project proposals are appraised, the Financial Times article notes.

-30- Contact: Stephen Howard, director of communications 604-240-8524