P3 model for Regina bypass project saves $380M: third-party review

Avalue for money report prepared by Ernst& Young shows a P3 build for the Regina bypass project will save about $380 million.

The provincial government released the report this morning. Documents show that a traditional build would have cost $2.2 billion, instead of the $1.88 billion touted by government.

"The report confirms what our government has said many times that a P3 was the right decision for this project," SaskBuilds Minister Gordan Wyant said in a release Tuesday morning.

The report included the cost of private financing, cost of design, construction and 30 years of operations and maintenance on the roads.

The bulk of the government's savings fall under the retained risk category.

Construction on the bypass project began this summer. The first phase is expected to open in fall of 2017 and be fully completed in 2019.

NDP claims 'bypass fiasco' costs more

The NDPdoesn't buy the numbers in the report.

In a release Tuesday morning, the Opposition said the government's own numbers show the P3 model actually costs more.

The bulk of the government's savings istied up in a category called 'retained risk' something the report says will save the government about $430 million, but the NDP says retained risk calculations have been declared bogus in other jurisdictions.

With that in mind, the Opposition says the project will actually cost taxpayers $200 million more than a traditional model.

"The only way government can justify this, potentially, to taxpayers is with this very large and unsubstantiated risk transfer cost," said NDP Deputy Leader Trent Wotherspoon.

But Wyant disputes the opposition claims.

"The auditor has said that risks are real and that there are costs associated with those risks.So, if you can take a project and you can transfer that risk from the government to the proponent team, there's certainly value in that to the taxpayer," he said.

According to the NDP,Ontario's Auditor General reviewed 74 P3 projects in that province and found that despite value for money reports,government spent$8 billion more than they would have with traditional builds.