Senate showdown looms over infrastructure bank
OTTAWA — The government’s plan to create a new $35-billion infrastructure bank is facing a rocky road as senators stand poised to rewrite the Liberals’ budget bill and delay creation of the financing agency.
An independent senator will ask the Senate next week to separate out the legislation creating the so-called infrastructure bank from the larger budget bill to give the upper chamber more time to debate the proposal.
Whether Sen. Andre Pratte has enough support is unclear, but he said there is interest from Conservatives, Liberals and independents who want more time to review the legislation.
The Liberal government’s plan is to use public funds through the bank to leverage billions more from investors to pay for large projects, such as rail lines, bridges and transit systems that might be too expensive for governments or too risky for private companies to handle alone.
Pratte said several senators remain unconvinced about the plan after a preliminary study of the proposal, citing concerns about the agency’s independence, transparency and the degree to which taxpayers will be exposed to financial risk.
“In many senators minds, those hearings have actually pointed to more issues to be studied,” said the Quebec senator who was appointed by Prime Minister Justin Trudeau. “There are issues and questions that have arisen that point to more concern, rather than less.”
The Liberals said they see no reason to separate the bank from the rest of the bill that implements elements of the federal budget. Infrastructure Minister Amarjeet Sohi said the government wants to get the bank up and running by the end of the year, including appointing a chief executive and board of directors and can’t do that without parliamentary approval for the bill.
“The Canada infrastructure bank is such an integral part of our overall infrastructure plan and it really ties into the budget process and that’s why it’s there,” Sohi said before Wednesday’s caucus meeting.
“Having it as part of the broader budget legislation makes sense so we can get on with delivering on the commitments that we made to Canadians.”
The Liberals continued to face flak over the plan in the House of Commons on Wednesday amid concerns the government is putting taxpayer dollars at risk in order to lure private investment, details of which have been outlined in internal government documents obtained by the Canadian Press. The documents say taxpayers may bear significant risk in projects where the government takes an equity stake, provide a loss buffer to private investors in other instances, or invest on equal footing but at “concessionary terms” with ownership reverting to a city or province at the end of a term.
The documents show the bank could use financing tools such as derivatives and contributions that are repayable based on benchmarks.