Hospital overruns add to Charest's troubles

First UQAM, then the Caisse, and now rising costs of the three new hospitals


The bad news just keeps coming for the Charest government. This week the mounting costs of Montreal's proposed hospitals took over the headlines from the $40- billion losses at the Caisse de dépôt et placement and the controversial appointment of Michael Sabia.
Auditor-General Renaud Lachance confirmed that in the last two years the cost of the French-language CHUM shot up to $2.5 billion from $1.1 billion. Cost of the bilingual MUHC went up 50 per cent to $2.2 billion. As for the Ste. Justine children's complex, the bill went up 42 per cent to $500 million.
But with CHUM optimistically predicted to open in 2018 and the MUHC a few years before that, these are only projected costs. So expect the final total to be even more impressive.
According to the auditor- general, this situation stems from a number of factors. But most point to the government's inadequate management, its lack of supervision, too many "captains" steering the boat, and hundreds of millions of dollars in unsecured funding from private foundations and the federal government.
The Charest government's decision to go with a PPP, a public-private partnership, could also turn into a nightmare. It was highly questionable to plan public hospitals that would end up as tenants of big private consortiums to which the government would have to pay huge amounts in rent over 30 years. But now, with the recession, there's also a clear possibility that the two bidding consortiums might fail to get their financing together before next year.
Should that happen, either taxpayers would end up covering the entire final cost - expected to run more than $5 billion - or the government would be forced to scale down these projects accordingly.
In the meantime, life must go on. Which means that while we wait for the new hospitals, existing ones in Montreal need essential renovations, new equipment and their dilapidated clinics repaired. While crucial to the quality of care, these costs are also adding up due to the appalling number of years it is taking to get the three hospitals built.
The concept was born under the Parti Québécois government when it said yes to McGill's proposal for a (then) superhospital, but it's the Charest government, in power since 2003, that shoulders the blame for the rising costs, delays and changes in locations.
Blamed by many Quebecers for having let the Caisse de dépôt take too many risks while denying the losses throughout the election campaign, this government also stands to pay politically for the CHUM-MUHC saga. The auditor-general's report doesn't do anything to soften that blow.
A little over a year ago, the auditor-general reported another case of costly mismanagement: UQAM's financial debacle brought on by the building of the Pierre-Dansereau complex and the stalled Îlot Voyageur, which dug a hole of more than $300 million in the school's budget.
Lachance blamed UQAM's mismanagement on its rector, a couple of high-placed directors, and its board. But it also pointed a finger at the education department, saying that it failed to do "adequate follow-up of UQAM's financial situation even if the information that was available, both internally and externally, had shown a major deterioration."
Since then Jean-Marc Fournier, who was education minister, has left politics and left Quebecers with many unanswered questions, questions added to others about the Caisse's losses and the mounting costs of the hospitals.
Add this: With the government planning to spend $42 billion on construction and infrastructure during the next five years, including the hospitals, more questions are being asked. Why? Because there are reports in the media of criminal elements possibly infiltrating some construction companies; projects that cost 10 per cent more in public funds than in other provinces; tax evasion; cozying up among big construction bosses, some politicians and union leaders; lucrative contracts often given to the same firms at the provincial or municipal levels.
This week La Presse columnist Yves Boisvert suggested a public inquiry like the Cliche Commission which in the 1970s investigated Quebec's biggest construction and infrastructure projects and helped clean the whole mess up. Before we dish out $42 billion, could it be time to clean up again?

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