Govt perpetrating fraud

The government is perpetrating a massive fraud with its proposal to build a new hospital in Dunedin and new highways using the public–private partnership model, according to Democrats for Social Credit Party Deputy Leader & Finance Spokesman Chris Leitch.

The government is rolling out those schemes for much of its infrastructure development in schools, roads, and now health as if they are the greatest things since sliced bread.

Yet that model has proven to be a dismal failure and is being rolled back internationally, with many cities reclaiming projects back from the private sector owners.

Public private partnerships have been shown to provide a solid gold 25 year profit guarantee to private developers, while shouldering taxpayers with the costs of meeting that guarantee.

In most cases the public pay significantly more over the period of the deal than they would have done using the old model.

With PPPs the government can proclaim that its books are looking good and its debt is down because the cost of financing the project does not show up as borrowing on government accounts.

The loans are taken out by the private sector developers but the cost is borne by the public.

The latest announcements will cost taxpayers in excess of a billion dollars more than if the government had financed them directly.

That’s the fraud. Taxpayers are lied to about the state of the government accounts and then have to stump up with the money to foot the bill anyway.

The Executive Director of the Association of Salaried Medical Specialists, Ian Powell, is right on the money when he says profit making companies should have no business taking a stake in public hospitals.

ENDS

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