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The problem has been execution. For whatever reason, the infrastructure bank has failed to gain traction. Trudeau and Sabia admitted as much. “We put forward something extremely innovative and, quite frankly, we then had to figure out how to deliver,” the prime minister said.
One issue could be the public’s general distaste for user fees, which makes turning public funds into profitable investments politically difficult, since it’s the prospect of a consistent revenue stream that pension funds and other institutional investors are seeking in return for their upfront involvement. The official Opposition’s insistence that it would kill the infrastructure bank probably makes some potential partners nervous, too. And the PMO’s tendency to micromanage probably isn’t helping, as the newest Crown hasn’t had a chance to create distance from the centre.
If Sabia manages to get CIB out of its rut, it’s possible to imagine good things. Take his idea to spend $1.5 billion on electric buses. It could lead to a pile of orders for Lion Electric Power Co., the Saint-Jérôme, Que.-based maker of electric buses that has recently secured orders from Canadian National and Amazon.com Inc., assuming Lion wins whatever contracts will come. Smart governments build national champions by giving potential winners a chance to succeed, rather than lathering them with subsidies.
But politicians will have to get out of the way. Trudeau’s many critics would have been surprised to see him douse suggestions that the infrastructure bank could be used for “social infrastructure” such as long-term care homes or to rescue industries like retail and aviation, reminding reporters that the infrastructure bank’s mission is to make money for both itself and its partners.
It’s a start. There’s a long way to go.