There are undoubtedly those who will never accept the fact that in electing Justin Trudeau and his sunny band of men and women, they were, in fact, putting into power a group as neoliberal as the outgoing Harper regime. It is a hard truth, one that I have had to accept despite the fact that mine was one of the many votes that put the Liberals back into power.
The
latest evidence of this sad truth is found in new information about the
Canadian Infrastructure Bank, a scheme ostensibly designed to raise private capital to fund various projects to rebuild our steadily decaying roads, bridges, etc.
Federal investments doled out through the government’s new infrastructure financing agency may be used to ensure a financial return to private investors if a project fails to generate enough revenues, documents show.
What investors have recently been told — and what the finance minister was told late last year — is that if revenues fall short of estimates, federal investments through the bank would act as a revenue floor to help make a project commercially viable.
Experts say the wording in the documents suggests taxpayers will be asked to take on a bigger slice of the financial risk in a project to help private investors, a charge the government rejects.
The devil, as they say, is in the details:
An October briefing note to Finance Minister Bill Morneau ahead of the fall economic update where the government unveiled the financial plan for the bank, said federal funding could be structured in such a way that the bank’s “return on investment will only materialize if defined institutional investor revenue thresholds are met.”
“The infrastructure bank could enter in the capital structure to bridge the gap between reasonable returns on investment for investors and the revenue generation capacity of specific infrastructure projects,” reads the briefing note, obtained by The Canadian Press under the Access to Information Act.
In other words, if I interpret this correctly, should revenues for private investors fall below expectations, we, the taxpayers, will be propping up their profits.
Despite my aging olfactory system, I am forced to conclude that this scheme does not pass any reasonable smell test.