Taxpayers will not be hit over delay in P3 hospital

North Battleford project running several months behind schedule

The private company in charge of building a new hospital in North Battleford is delaying its completion date.

A public-private partnership (P3) was used for the project, and the province announced Tuesday the company chosen as the vendor — Access Prairies Partnership (APP) — is two to three months delayed.

The reason provided by the province is “a subcontractor unable to deliver according to the overall schedule.”

SaskBuilds Minister Dave Marit said he is unsure of what the specific issues are, but said extra staff and shifts have been added to address the delays.

APP will be fined about $1.25 million per month, said Marit.

“I’m not real concerned it’s going to take much longer, because obviously the partners are going to want to make sure they get this back on track,” he said.

“Obviously, every delay is costing them money also, so they want to get this resolved as quick as possible.”

The minister was adamant the delay is “not any cost to the taxpayers of the province” because the cost of delays are paid for by APP.

Premier Scott Moe also weighed in on the delay on Tuesday.

“This is challenging, as we were hoping that it would be finished so we can start our move into this facility,” Scott said, adding it “bodes well” for the work done by the province prior to the project because the delay will be paid for by the private partner, not taxpayers.

Repeatedly the province has said P3 projects are delivered on time and on budget. With other projects, such as the nine jointuse schools and, to date, the Regina bypass project, that has been the case. Asked if this delay shakes the government’s belief in that notion, Moe said he continues to “feel confident in the process we have.”

The facility is expected to be “among the most advanced mental health treatment centres in Canada”, once complete. Construction began in September 2015 and was expected to be finished this June.

A government website dedicated to the project states, “this provincial psychiatric facility will open on-time and on-budget.”

Total cost of the build was $407 million, which, according to the province includes the design, construction, finance and maintenance of the facility.

SaskBuilds said using a P3 model for the project “saves taxpayers $15 million on construction alone. A traditional build was expected to cost $237 million, but a P3 approach drops that to $222 million.”

Opposition NDP Leader Ryan Meili pointed to news out of Manitoba this week that the Conservative government in that province has decided to move away from using P3s as a means to build because using a traditional route saves more money.

He said the majority of the experiences out there show it’s less expensive and gives more control “if you build it yourself.”

This is not the first obstacle faced in building the new North Battleford hospital. Earlier this year a British company, Carillion PLC, involved in the project went into liquidation. The province said a replacement company has been found.