Save the Canada Infrastructure Bank—from itself

We need to rebuild the Canada Infrastructure Bank with a new vision and mandate that abandons privatization and gives Indigenous, provincial, and municipal governments a seat at the table

The Greyhound bus station in Ottawa was demolished this month – the end of an era and a lifeline for rural Canada. When Greyhound folded their Canadian operations in 2021, small communities immediately felt the impact.

Imagine if the federal government had taken Greyhound over and run it as a public service that existed to keep rural communities connected, rather than to turn a profit. Imagine if there was a public bank, governed democratically, that backed a new publicly owned and operated national transit system.

That could have been the Canada Infrastructure Bank. It had such promise, yet has been such a colossal failure.

The bank was originally a 2015 Liberal election promise to provide low-cost loans for much-needed municipal infrastructure. By the time Parliament passed a 2017 law establishing the bank, its core mandate had dramatically shifted.

On paper, the bank is supposed to leverage private investment to deliver infrastructure projects. Yet in the five years since it opened its doors, the only bank-financed project under construction is the privately-owned and operated Réseau Express Métropolitain (REM) in Montreal. The REM is co-financed by the Government of Québec and the Caisse de dépôt et placement du Québec, an institutional investor for the Quebec Pension Plan and other pension and insurance plans.

According to the Parliamentary Budget Officer, the bank has not met its own targets when it comes to attracting private investors. The failure has been so spectacular that when members of the House of Commons Standing Committee on Transportation, Infrastructure and Communities studied the bank earlier this year, they had one single recommendation: shut it down.

Instead of putting the needs of the public first, the bank is required by law to prioritize private investment in so-called public-private partnerships (P3s) and other privatization schemes.

Study after study shows that P3s are rarely, if ever, good for the public. In 2014, Ontario’s auditor general found that Ontarians paid $8 billion more for 74 P3 projects than they would have if they had been financed and delivered publicly.

The problem is that the private sector, by its nature, is more concerned about private profit than the public interest. And what’s in the public interest is seldom in the interest of shareholders.

This is why evidence shows that P3s are a cash-cow for corporations at the expense of the public – through guaranteed long-term payments as well as tolls and other user fees – or are

plagued with delays, contract renegotiations and lawsuits as companies cut corners to save themselves money while leaving the public on the hook for maintenance and repair.

The Government of Canada is required to undertake a statutory review of the Canada Infrastructure Bank soon, and that review presents us with an opportunity.

Canadian communities need reliable, public, climate-resilient infrastructure now more than ever. As Atlantic Canada rebuilds from Hurricane Fiona, our Eastern neighbours and friends will need to repair roads and bridges across the region. The hurricane has battered their ports and harbours, and wrecked power grids.

In the west, out-of-control wildfires in British Columbia this season have led to evacuation orders and smoky skies covering hundreds of square kilometres. This, after devastating floods cut off rail and highway access to Canada’s biggest port in Vancouver last year.

Climate change is making severe weather events more common, including Ottawa’s derecho storm in May. Not only do we need reliable infrastructure financing for communities to withstand these events, but we need such financing to put people and the planet first. And that means removing private profits from the equation.

We believe there’s a better way forward – one where the bank sheds its private-sector financing mandate to become a public bank with a public purpose.

We don’t need to shut the Canada Infrastructure Bank down. We need to rebuild it with a new vision and mandate that abandons privatization and gives Indigenous, provincial and municipal governments a seat at the table.

Let’s open our minds to the possibilities that lie ahead when we put public interest ahead of private profit.

Aditya Rao is a Senior Research Officer for the Canadian Union of Public Employees, Canada’s largest union with 700,000 members working in health care, emergency services, education, early learning and child care, municipalities, social services, libraries, utilities, transportation, airlines and more.

Bonita Zarrillo is the MP for Port Moody–Coquitlam and the NDP Critic for Infrastructure and Communities.