Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(}function setPanelState(o){dom.root.classList[o?"add":"remove"](,dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

Canada's Finance Minister Bill Morneau speaks during Question Period on Parliament Hill in Ottawa on Feb. 14, 2017.


Finance Minister Bill Morneau says cabinet will have the final say on any projects approved by the Canada Infrastructure Bank, a proposed $35-billion entity that the Liberal government describes as an arm's length Crown corporation.

The minister's comments touch on one of the key points of tension surrounding the bank: Private investors – including Canadian pension funds – want assurances that any project decisions will be free of partisan politics and the short-term whims of election cycles. However, the government must also demonstrate appropriate oversight of the bank in response to critics who say it could give the world's largest investment funds too much influence over how billions in federal tax dollars will be spent.

Mr. Morneau outlined Monday how he expects the government will manage those competing demands.

Story continues below advertisement

Read more: Infrastructure Bank risks slowing down projects, internal report warns

"We will need to have [cabinet] approval to make sure those projects make sense for Canadians, of course, but the organization, the financing and the management of those projects will be left to the Canada Infrastructure Bank to execute," he told reporters following an appearance before the House of Commons finance committee.

"We will always need to have some level of oversight. Our goal is that the bank can be as independent as possible from a governance standpoint and from a management standpoint. And that once a project is determined to be the right kind of project, that it can be run and managed separate from government intrusion," he said.

The Liberal government's 2017 budget describes the Canada Infrastructure Bank as an "arm's length organization" that will work with other levels of government and private investors on major projects that would be led by the private sector.

Legislation to create the bank is included in Bill C-44, an omnibus budget bill. Mr. Morneau's advisory committee on economic growth – which includes representatives from major institutional investment firms – had recommended in an October report that the bank's independence should be modelled on the Canada Pension Plan Investment Board (CPPIB).

However, the details of the bill show the bank's board of directors will need cabinet approval before issuing loan guarantees. The legislation also gives cabinet the power to remove or suspend any director of the bank. Ben Dachis of the C.D. Howe Institute has pointed out that this makes the bank less independent than directors of the CPPIB, who can only be terminated with cause. Mr. Dachis said Monday that cabinet should have a say early on in a project-approval process, but Mr. Morneau should be more clear as to how and when cabinet would be involved in bank decisions.

Because the legislation to create the bank is part of an omnibus budget bill, it will not be subject to a thorough review by parliamentary committees. The Commons transportation, infrastructure and communities committee will hold a two-hour hearing on the bank legislation Tuesday. That will likely be the only meeting exclusively on that topic, though the NDP intends to put forward a motion to call more witnesses.

Story continues below advertisement

The proposed bank is partly inspired by Infrastructure Australia, an independent body that was created in 2008 to prioritize nationally significant infrastructure.

An internal research paper conducted by KPMG for Infrastructure Canada noted that Infrastructure Australia initially faced concerns that it was not independent enough as a division of a federal department.

"As a result, there was a perception among state and local governments that [Infrastructure Australia] lacked independence and was heavily politicized," the KPMG report stated. "This led to the refusal by some state and local governments to submit business cases for inclusion of their projects with the national project pipeline."

Australia changed the law in 2014 to establish a chief executive position who is appointed by an independent board, which is similar to what is being proposed in the Canadian legislation.

Mark Romoff, president and CEO of the Canadian Council for Public-Private Partnerships, a non-profit, non-partisan organization, said private infrastructure companies will be watching closely to see who the government appoints to the board and who becomes CEO before judging whether Ottawa has struck the right balance in terms of independence and government oversight.

"I think you can find common ground there," he said. "We have a very successful track record in Canada of the private sector working closely with government at all levels … to get critical infrastructure built."

Story continues below advertisement

In a speech earlier this month, Ontario Teachers' Pension Plan CEO Ron Mock referred to Australia and a similar program in Britain as the "gold standard" for how governments can partner with institutional investors on infrastructure projects.

Mr. Mock praised the Canada Infrastructure Bank as a positive initiative, but said the devil is in the details.

"I believe it comes down to what role government should play. We know that there has to be strong governance in place with a high level of independence, but we also know that government absolutely must play a key role," he told the International Finance Club of Montreal on May 4. Mr. Mock also said investors must address the fact that there is "a great deal of resistance" among the public for large private investment in infrastructure.

"If we want to pursue this model, we are going to have to find ways to clearly demonstrate the benefits, and to gain the public trust," he said.

Globe political columnist gives his take on the new Liberal budget, describing it as a plan mired in debt that will hinder the Trudeau government's agenda.
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to If you want to write a letter to the editor, please forward to

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies