Frank Swedlove is the president of the Canadian Life and Health Insurance Association.
During recent municipal election campaigns in Ontario and British Columbia, one issue dominated debates from Toronto to Tofino: The need for infrastructure investment. From the hospitals that heal us to the roads and bridges that link us, there's no question that Canada's infrastructure is in urgent need of renewal. And while a recent announcement by the federal government of $5.8-billion in additional infrastructure funding is welcome, much more needs to be done.
Canada's current infrastructure deficit is estimated to be somewhere between $350-billion and $400-billion, with the majority of the need at the municipal level. It is unlikely that governments can close this gap on their own. That is why innovative funding approaches are required. Canada's life and health insurance companies can offer a solution: We have $570-billion in long term assets, and a strong appetite to invest in Canadian infrastructure, to keep our country moving forward.
Canada is a global leader in the use of public, private partnerships (or P3s) to help fund things like hospitals, transit project and airports. Canada's life and health insurers were at the forefront of the development of this market and have a strong appetite to do more. But action is required to make it easier for smaller projects, like those at the municipal level, to attract private sector investment. P3s are well suited for larger projects – say those over $100-million in size – as the complexity of structuring P3s are adequately compensated for by the large deal sizes. This is not the case for smaller projects, however. We need to look for innovative and collaborative approaches to help ensure that Canadian private sector money and know-how can be directed to projects that benefit communities of all sizes.
The need is urgent and growing. That's why we believe that provincial and federal governments, life and health insurers and other private investors need to work together to develop standardized P3 documentation for smaller projects and to find ways to bundle smaller projects together to achieve greater scale. PPP Canada is the federal agency created to develop and share P3 best practices and to encourage and increase the use of P3s throughout Canada. With an established leadership role, expertise, and a degree of direct influence over the P3 market nationally, it is the logical choice to lead this effort.
The announcement by Prime Minister Stephen Harper will help to address Canada's critical infrastructure needs. But there's more to do. So to newly-elected officials in Ontario and British Columbia, and to policymakers across the country, our message is simple – let us help. Canada's life and health insurers have considerable resources and a strong appetite to invest more in Canadian infrastructure. Working together, we can help to build the critical infrastructure that will make our communities – and our country – even stronger.