Monday, November 28, 2005

Dodgey P3's

Lost in the hoopla of the defeat of the Liberals is this announcement by David Dodge head of the Bank of Canada Dodge touts public-private deals

Governments' inability to successfully harness the hundreds of billions of dollars that pensions control is hurting the country's productivity, Mr. Dodge is expected to argue. He is speaking at a conference on public-private partnerships (P3) in Toronto Monday. That's because infrastructure needs — demand to build roads, schools, hospitals — are enormous and growing. Toronto-Dominion Bank figures the gap between what is needed to maintain or replace existing capital, and the amount actually spent, ranges from $50-billion to $125-billion for Canada. Pension plans, on the other hand, are actively shopping for long-term, stable investments, and infrastructure is a good fit for them, Mr. Dodge will say. Pension plans control $800-billion in assets, and are constantly on the lookout for projects that have a lifespan of 25 or 30 years that can give them a steady and decent rate of return. A man with a plan

I blogged here on this just the other day, and I hate to tell you I told you so but, well ..ok I told you so. The neo-con state in Canada, has failed to sell us on their P3 notions. And private capitalism is not up to the challenge just look at the failure of the privatized highway deal in Ontario. So where can capitalism find some capital just sitting around doing nothing.....well in OUR pension plans. Whether those are public sector plans or the CPP.

While private sector pension plans face deficits public plans are flush with capital and capitalism hates capitals that just sits around being unproductive, that is not inversted and earning interest.

What Dodge does NOT want, nor does existing capital markets is the direct control of public pension funds by the workers who fund it. Currently these funds are managed by private managers whose litany of investments are driven by the sole ethic of the market; profit.

Unions whose members fund these pension plans must demand more control over the investment policy and management of these plans. Otherwise the managers and the State will use them to fund P3's which are NOT in the workers interests.

The time for direct democratic control and transparency of public and private pension funds by the workers who fund them is now. The battle lines are being drawn by the corporations, the banks and Mr. Dodge. It is time for labour to fightback by demanding workers control of our pension funds public or private.

But the biggest roadblocks to P3s and attracting pension money to public infrastructure are probably public opinion and outright hostility from organized labour.

“[P3s] are part of a broader neo-conservative agenda that argues that all that is public should be privatized,” Canada's largest union, the Canadian Union of Public Employees (CUPE), said in a statement on its website.

P3s cost the public more than straight government funding, they are not accountable to the public, and they lead to higher user fees and laid-off workers, CUPE argues.

Mr. Dodge's speech Monday will be the second time in a month that he has clashed with organized labour.

Earlier in November, Mr. Dodge said that employers should have more of a say in what happens to the surpluses in defined-benefit pension plans.

“I say to David Dodge, keep your hands off our pension plans, because workers are in no mood ... for any more scams,” said Sid Ryan, president of CUPE Ontario.

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