The final version of this vital plan will likely be presented in the spring of 2011
December 3, 2010 By Rob Bradford
The Ontario construction industry, especially the civil sector, eagerly
awaits the imminent unveiling of the provincial government’s 10-year
The Ontario construction industry, especially the civil sector, eagerly awaits the imminent unveiling of the provincial government’s 10-year Infrastructure Plan.
The capital investment document will be vital to the stability and business planning capabilities of the design and construction industry. Without a reliable investment outlook going forward at least 10 years, the industry cannot effectively plan to have appropriate resources including a well-trained workforce, equipment and materials sources in place. The effect of trying to plan year to year with no vision of the future results in the chronic employment peaks and troughs within the industry.
Infrastructure Minister Bob Chiarelli has been meeting with industry and public stakeholders through the fall and his intention is to present the final plan in the spring, likely as a centerpiece of the spring budget. This follows completion of the Liberal government’s first five-year, $30-billion infrastructure program which set the stage for unprecedented investment in roads, bridges, clean water systems, hospitals, schools, public buildings and more.
That five-year plan signaled a serious commitment to beginning to address massive infrastructure deficits and laying the groundwork for future economic development and growth. The industry is looking for a similarly strong commitment in the new 10-Year Infrastructure Plan. While recent investment levels have recognized the need to turn around decades of underinvestment, unless they are maintained and enhanced over the long term the provincial infrastructure deficit will continue to grow.
A 2010 RiskAnalytica report establishes that investment in total public infrastructure over the last decade has averaged about 3.1% of GDP. It further recommends that sustainability requires investment closer to 5% of GDP in the future. That however is going to be a big challenge for a government with a recovering economy and a large deficit of its own that is going to have to make hard choices about spending over the next few years at least.
The construction industry has been actively involved in the consultations with Minister Chiarelli. While the dollars attached to the 10-Year Infrastructure Plan are a priority agenda item, the industry has also made recommendations on what the plan should look like. The Ontario Road Builders’ Association (ORBA) met with the minister in November as did the new Construction and Design Alliance of Ontario (CDAO) of which ORBA is one of 10 provincial association members. Submissions from the two industry organizations were remarkably similar on four key themes:
Municipal Infrastructure Sustainability
The 10-year plan should set out a clear strategy for achieving a dedicated and sustainable provincial source of funding for municipal infrastructure; to assist municipalities in addressing their infrastructure deficits and to support needed expansion.
To receive provincial funding, municipalities should have a mandatory asset management system in place. This will allow for provincial funding based on need as established by life-cycle planning models. Municipal data would be maintained in a central database and be available for investment planning.
Core Infrastructure Focus
The plan should concentrate on core infrastructure, with specific distinction between core and social infrastructure. The plan should contain a transparent measurement system, in order that throughout the delivery of the plan both the government and the public will be able to recognize the impact that investment in infrastructure is making on the ‘core’ infrastructure deficit.
As part of the 10-year plan the government should set out a process for reviewing all regulatory policy that affects the ability of the construction industry to deliver infrastructure projects on a timely and cost-effective basis. Possibly each year one large piece of legislation is reviewed and amended if necessary. Examples could include Permits to Take Water, Municipal Class EA’s, Brownfield Legislation, “One-Call to Dig,” etc.
The industry also recommends that the provincial government establish the objective of working with the federal government toward a single, integrated environmental assessment process.
Alternative Financing and Delivery
The civil construction industry supports and has the ability to deliver projects that contain innovative funding and/or other alternative contract delivery mechanisms.
The use of such procurement models should be explored and used where appropriate in broader infrastructure areas such as water treatment or major new highways, where it can be demonstrated they offer greater value for taxpayer dollars and/or allow investments in infrastructure that otherwise might not be possible through normal government budgeting and funding processes. There should be a systematic approach to selection of the appropriate delivery model, consistent with the nature and size of the project.
However, traditional design-bid-build tendering models must also be maintained in order in support of a diverse, competitive Ontario construction industry.
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