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Commentary: July-August 2011

Should governments get involved in projects that have typically been the domain of the private sector?

Should governments get involved in projects that have typically been the domain of the private sector? That’s a question that is front and centre in Nova Scotia these days as crews from the provincial government’s Transportation and Infrastructure Renewal (TIR) prepare to get hands on in the province’s roadbuilding business, following a 20-year hiatus.

It’s a decision that has of course been met with some resistance. It has been highly criticized by the Nova Scotia Road Builders Association (NSRBA) and a number of its allies, including other associations and private sector companies who are crying foul, saying that “government has no business being in business.”

TIR officials counter by saying they really don’t plan to take work away from private sector roadbuilding companies, and the projects they are targeting to bring in house will only account for between 5% and 10% of the province’s chip seal paving and asphalt work. They contend that their main goal is to bring pricing in line when there is little or no competition for roadbuilding work in remote areas of the province. They make some good arguments, pointing to neighbouring New Brunswick, where they also have some in-house crews competing against the private sector and average costs that are staggeringly lower than Nova Scotia’s.

But for NSRBA members, any amount of government work is too much. They ask valid questions, especially when it comes to accountability. They say private sector roadbuilders must warranty their work, adhere to regular quality control checks, and meet environmental and safety standards that are set by the government and monitored by the government. The same government that they now must compete against for business. Their main concern – who is going to hold TIR accountable for accurate financial analysis of its true costs?

Both sides are well prepared for the fight. In covering the issue for this magazine (you can read the full story starting on page 11), I talked with Bruce Fitzner, chief engineer for the province’s TIR Highway Programs, and Kevin Mitchell, TIR’s director of fleet management. They came armed with relevant  information such as fact sheets and frequently asked questions. They were also pleased to show their new tools of the trade, including asphalt spreaders, rollers, dump trucks and more. On the other side, I spoke with Grant Feltmate, executive director of the NSRBA. He has gone pubic with his members’ concerns, spearheading a highly visible campaign that includes radio, television and print communications, all aimed at educating Nova Scotia’s taxpayers on the association’s views on the subject.

So how will this conflict end? Since TIR has already invested taxpayer funds in new equipment and started training crews, it seems as though this program will go ahead regardless of the resistance. On the other side, roadbuilders are asking about their future in the province, and as NSRBA’s Feltmate will tell you, those same private roadbuilding companies are questioning their ability to invest and do business in Nova Scotia going forward.

This is an important issue not just for Nova Scotia, but for the entire country as other jurisdictions look on with interest. Do you have an opinion on the topic? If you do, drop us a note at the e-mail address below and we will print some of the responses in our next issue.