by Doug Luellman, CUPE 474

The recent construction of a Calgary public school by a private developer to be leased back to the Calgary Board of Education (CBE) should set off alarm bells for supporters of public education.

The Hamptons project is a school in a new neighborhood that was constructed by the area developer and leased to the CBE. This is known as a ‘lease back’ and is part of the newest trend in privatization of public services; Public Private Partnerships known as P3.

The CBE announced the completion of the school in a press release in January; stating that the Hamptons school is the first developer-built school in Alberta. Tirion Developments contributed $750,000 towards the project and Alberta Learning contributed $450,000 towards the cost from its $10 million Innovation Fund.

In Edmonton the public school board has been approached by Tewiliger parents and Carma Developers with a P3 plan to build a public school in that suburban neighborhood despite the fact there is an under-utilized school in the neighborhood. They too are being pressured into public-private partnerships by the funding conditions of Alberta Infrastructure School Innovation Fund.

When the Klein government merged departments last year into super-departments, all infrastructure costs in the province which include highways, municipalities, hospital and schools, are now housed in one department with its own separate funding programs. The School Facilities Innovation fund is one of these.

In 1998 a public review was done by the provincial government to assess the current physical condition of Alberta’s schools. The results of this review showed that many of our schools are falling apart, are in disrepair, and are old. The final price tag for repairing and upgrading al Alberta schools came to just under a billion dollars.

The School Innovation fund was one result of this review. The fund is being used by the government to force school boards into public-private partnerships as has happened in Calgary and may soon happen in Edmonton. The $10 million dollar fund provides matching funds for building new schools when school boards partner with the private sector, in this case developers who are creating housing projects in new suburban districts of the city.

Other ‘innovative’ partnerships between the public schools and the private sector will be given funding under this program. The simple fact is that this slush fund has been created to promote the further privatization of public education while not addressing the need for secure full government funding to repair schools.

The government has made it clear that public education funding will be tied to promotion of business and corporate links with school boards. In response the Calgary Public and Separate Boards have formed a business foundation to promote this. The Superintendent of Edmonton Public School Board meets monthly with the Chamber of Commerce and other business leaders in a Superintendents Round Table.

And while business should be paying for education through their taxes, they have been relieved of this ‘financial burden’ by the government who has reduced education taxes over the past five years.

Business in Canada, and around the world, has made ‘Education Reform’ their watch word. They wish our schools to produce docile workers rather than well-rounded citizens. This is far from benign. Increasingly our school boards are being pushed to participate with some rather unsavory right wing ideologues who are promoting the privatization agenda under the guise of these so called ‘business partnerships’.

The Canadian Council for Public-Private Partnerships holds an annual conference on P3’s, pushing the privatization agenda to politicians and public sector administrators. Last fall the conference in Toronto was attended by a senior member of the Edmonton Public School Board administration in charge of the Tewiliger School Private Public Partnership plan. One of the panelists that they sat with was from the Reason Public Policy Institute, part of the Reason Foundation. The Reason Foundation is an American right wing think tank that promotes the privatization of all public services.

In the area of public education it has promoted the contracting out of all school services, teaching, custodial, maintenance, busing, food services, etc. and is a cheerleader for corporations like EAI (Education Alternatives Inc.). The Reason Foundation is listed as a Calgary Board of Education Business Partner. They are a key associate with the Canadian Council for Public-Private Partnerships.

"In a recent address to The Canadian Council for Public-Private Partnerships Robert Poole, President of the Reason Foundation, demonstrated his exceptional knowledge of privatization initiatives and trends from around the world. He shared his views on why governments need to make the transition from being service providers to being policy makers and regulators. He contends that governments using public-private partnerships (P3s) can increase productivity, and ultimately, will be more competitive.

He also believes that removing union power is a successful technique...". The Canadian Council for Public-Private Partnerships Newsletter May 1999

The Reason Foundation, along with the Heritage Foundation (another American right wing lobby group), has been promoting, the P3 school construction program in Nova Scotia. And they are very clear about what the implications of P3’s are. "Under the P3 program, Nova Scotia's Ministry of Finance requests bids from qualified developers to provide one or several school facilities built to the ministry's specifications in a designated district. The developer furnishes the desks, telephones, blackboards, and computers while the school system provides teachers, principals, and students. Prospective qualified bidders compete on price, and the cost of the project is converted into a 20-year lease with annual rent payments equal to 85 percent of the capitalized cost of the project. In order for the developer to make up the difference in cost and earn a profit on his investment, the contract is structured so that the school system leases the building for specific hours, days and months. During the hours, days and months in which the public school system is not using the facility, the developer can rent its space to other approved and compatible organizations and businesses."

Nova Scotia is leading the way in embracing P3’s for school construction despite protests from teachers, parents, support staff and community representatives. They have not saved money, in fact they are costing more, and they have proven detrimental to community based schooling. Viable schools that were in need of repair were closed down while new schools were built by developers in newer suburban communities forcing parents to bus their children.

One of the inherent flaws of privatization is the high cost of private as compared to public financing. Another is the need to ensure an attractive profit margin for the private company undertaking the service. According to the Nova Scotia Teachers Union, the Nova Scotia Auditor General judged that costs related to the lease-purchase of one P3 school were $300,000 more than if the province owned the same facility and financed it with public debt.

The CUPE Annual Report on Privatization states that, "the Canadian experience with private ventures has demonstrated that they cost more to provide the same services. This is because many expenses do not become apparent until after private companies receive contracts, and costs associated with tendering practices and subsequent contracts are not factored into comparisons with equivalent public sector work. A 1998 Vector poll showed that Canadians believe that public private partnerships (P3) are likely to result in less quality and accountability, higher costs and higher risks."

The use of P3’s to privatize construction costs are being promoted not just for schools but hospitals as well. Premier Klein said as much in his televised speech in February, when he told Albertans that the government was getting out of the business of providing for the ‘bricks and mortar’ of our health care system. The government plans to defer hospital construction funding to private developers who will lease them back to the Regional Health Authorities.

Once again our public education system is being used to experiment with the latest flavour of privatization. The success or failure of the governments push for P3’s in public education will determine how wide spread this program will become.