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Abstract
Public–private partnerships and social impact bonds are both forms of private sector encroachment on state activity and are new frontiers of commodification that rely, ultimately, on subsidies or concessions from the state. This article provides an update on both models in the Canadian context, and it reviews theories that rationalize their emergence and growth. Both models have been nurtured by direct and indirect government support, as opposed to any demonstrated superiority, raising concerns that these models are proceeding contrary to the public interest.
Notes
Notes
1 Ryan and Young, “Social Impact Bonds”; Warner, “Profiting from Public Value”; and Warner, “Private Finance.”
2 Social Finance, “Impact Bond Database.”
3 Loxley, “Public-Private Partnerships.”
4 Whiteside, About Canada.
5 Loxley and Loxley, Public Service Private Profits, 1; Whiteside, About Canada, 31–35.
6 Whiteside, About Canada, 35–41.
7 Canadian Council for Public-Private Partnerships (CCPPP), “Public-Private Partnerships,” 7.
8 Loxley, “Public-Private Partnerships,” 26.
9 Inframation Group, “Canada PPP State of the Market.”
10 CCPPP, “Public-Private Partnerships”; and Philpott, “Speech for The Honourable Jane Philpott.”
11 Gomez-Perez, “Canadian P3 Secondary Market.”
12 Loxley, “Public-Private Partnerships,” 10.
13 Inframation, “Global Transactions Database.”
14 Social Finance, “Impact Bond Database.”
15 Government of Saskatchewan, “Innovative Sweet Dreams Project.”
16 Human Resources and Skills Development Canada, “Government of Canada.”
17 Gustafsson-Wright, Gardiner and Putcha, Impact Bonds, 127.
18 Government of Saskatchewan, “Premier Appoints Legislative Secretary.”
19 Government of Saskatchewan, “Social Impact Bond.”
20 Royal Bank of Canada, “RBC Social Finance Initiative.”
21 Farthing-Nichol and Jagelewski, Pioneering Pay-For-Success, 5, 12.
22 Monsebraaten, “Groundbreaking MaRS,” l ; and Gilbert-Walters, “Access to Justice.”
23 Kielburger and Kielburger, “Canada’s First”; and Social Finance, “Essential Skills.”
24 Colleges and Institutes of Canada, Essential Skills.
25 Whiteside, “Public Works,” Whiteside, “Stabilizing Privatization.”
26 Whiteside, “Public Works,” 13.
27 Whiteside, “Public Works,” 13.
28 PPP Canada, “About Us.”
29 PPP Canada, “About Us.”
30 PPP Canada, “Building Canada Fund.”
31 Infrastructure Canada, “Government of Canada Announces.”
32 CCPPP, “Canada Infrastructure Bank.”
33 CCPPP, “Canada Infrastructure Bank”; and Whiteside, “Private Finance.”
34 Advisory Council on Economic Growth, Unleashing Productivity, 12.
35 Canadian Union of Public Employees, “Infrastructure Bank.”
36 Government of Canada, “Harnessing the Power.”
37 Government of Saskatchewan, “Vision 2020 and Beyond.”
38 CBC News, “Referendum Results.”
39 Government of Manitoba, “Backgrounder,” 1.
40 Government of Manitoba, “Backgrounder,” 2.
41 Government of Manitoba, “Backgrounder,” 1.
42 Government of Manitoba, “Framework for New Schools.”
43 Government of Manitoba, “Statement from Minister.”
44 Gerster, “Niverville Teams Up.”
45 Gerster, “Health-care Union.”
46 For reviews of these infrastructures and supports, see Loxley, “Public-Private Partnerships,” and Loxley and Loxley, Public Service Private Profits.
47 Bakx, “Alberta Government.”
48 Malcolmson, Social Impact Bonds.
49 McGladrey, “Social Impact Bonds,” 27.
50 MacDonald, Wenban, and Ciufo, “Building Social Bonds.”
51 Critchley, “Countdown.”
52 Walter, “RAFT Seeks Investors.”
53 Friesen, “Manitoba Budget Address”; and Government of Manitoba, “Request for Proposals.”
54 Government of Manitoba, “Request for Proposals.”
55 Government of Manitoba, “Manitoba Selects Consultant.”
56 Whiteside, “Public Works.”
57 Dexter Whitfield, Contracts in UK.
58 Loxley, "Public-Private Partnerships”; Whitfield, Global Auction; Whiteside, About Canada; and Whiteside, “Canada’s Privatization.”
59 Loxley and Loxley, Public Service Private Profits, 173–75.
60 Vining and Boardman, “Theory and Evidence,” 38.
61 Shaoul, “Private Finance Initiative,” 190–206; and Chong et al., "Water Distribution,” 149–69.
62 Reynolds, “Flipping Equity.”
63 See Loxley and Loxley, Public Service Private Profits, for a summary of the value for money calculation process, which compares conventional procurement to the proposed P3 delivery model and calculates the value achieved.
64 Loxley and Loxley, Public Service, Private Profits; and Reynolds, “BC Hospital.”
65 Whiteside, “Canada’s Privatization.”
66 Whitfield, “£10bn Sale.”
67 Whiteside, “Canada Infrastructure Bank”; and Whiteside, “Private Finance,” 223–37.
68 Bending, “I love You SIB.”
69 Ryan, “Social Impact Bonds.”
70 Ontario Public Service Employees Union, “Out of Patience.”
71 Loxley, “Social Impact Bonds”; Malcolmson, Social Impact Bonds; and Whitfield, Private Finance.
72 Loxley, “Social Impact Bonds”; Malcolmson, Social Impact Bonds; Whitfield, Private Finance; Joy and Shields, “Social Impact Bonds”; and Edmiston and Nicholls, “Social Impact Bonds,” 57–76.
73 Fraser et al., “Narratives of Promise,” 14.
74 Joy and Shields, “Austerity and the Nonprofit Sector”; and Cooper, Graham, and Himick, “Social Impact Bonds.”
75 Clarke and Pitelis, “Introduction”; Bel, Fageda, and Warner, “Private Production,” 553–77; and Petersen, Hjelmar, and Vrangbaek, “Great Panacea,” 130–57.
76 Alchian and Demsetz, “Economic Organization,” 777–95.
77 Bel, Fageda, and Warner, “Private Production,” 555.
78 Van Slyke, “Mythology of Privatization,” 296–315; Hart, Shleifer, and Vishny, “Scope of Government,” 1129; and Vickers and Yarrow, Privatization, 426.
79 Dixit, Economic Policy, 2–3; Williamson, “Modern Corporation,” 1550; and Williamson, “From Choice to Contract,” 174.
80 Williamson, “Public and Private Bureaucracies,” 319–23.
81 Hart, Financial Structure, 29.
82 Hart, “Incomplete Contracts,” C69–C76.
83 Hart, “Incomplete Contracts,” C74; and Loxley and Loxley, Public Service, Private Profits, 24.
84 Bentz, Grout, and Halonen, Assets or Services; Iossa and Martimort, “Simple Microeconomics,” 4–48; and Martimort and Pouyet, “Public–Private Partnerships,” 393–411.
85 Hart, Financial Structure, 71–72.
86 Greco, “Imperfect Bundling,” 136–46.
87 Pauly and Swanson, “Social Impact Bonds,” 718–60.
88 Hodge, Privatization, 17–25; Vickers and Yarrow, Privatization, 157; Bel and Fageda, “Local Governments,” 517–34; Germà and Fageda, “Local Privatization,” 105–19; and Sundell and Lapuente, “Political Incentives,” 1–17.
89 See for example, Maskin and Tirole, “Public–Private Partnerships,” 412–20; and Feller and Liebman, Economics and Econometrics.
90 Rowthorn and Chang, “Political Economy,” 5.
91 Chang, Globalisation, 52–57.
92 Nasser, “Tendency to Privatize,” 22–37, 32–33.
93 Duménil and Lévy, Capital Resurgent.
94 See forward by Joseph Stiglitz in Roland, Privatization: Successes and Failures, IV.
95 Harvey, New Imperialism, 145–52; Loxley and Loxley, Public Service Private Profits, 7; Whiteside, “Stabilizing Privatization,” 87; and Whiteside, “Private Finance,” 223–37.
96 Harvey, New Imperialism, 117–20, 158.
97 Dowling, “Wake of Austerity”; and Dowling and Harvie, “Harnessing the State.”
98 Joy and Shields, “Social Impact Bonds,” 49; and Whiteside, “Stabilizing Privatization,” 87.
99 Whiteside, “Public Works,” 3; Joy and Shields, “Austerity in the Making.”
100 Halpren and Jutte, “Ethics”; and Cooper, Graham and Himick, “Social Impact Bonds.”
101 Warner, “Making Markets”; Tse and Warner, “Razor’s Edge.”
102 Loxley, Collapse.
103 Fraser et al., “Narratives of Promise,” 20.
Additional information
Notes on contributors
John Loxley
John Loxley teaches in the Department of Economics at the University of Manitoba in Winnipeg, Manitoba, Canada.
Jesse Hajer
Jesse Hajer teaches in the Department of Economics and the Labour Studies Program at the University of Manitoba in Winnipeg, Manitoba, Canada.