Attracting private investors into public infrastructure projects is not easy, even in Canada where its much more advanced than the US.
Canada's Federal government has reached out to the large public pension plans in Canada with sizable infrastructure portfolios, including the C$282.6 billion Canada Pension Plan, Ottawa and the C$171.4 billion Ontario Teachers' Pension Plan, Toronto, as well as the C$248 billion Caisse de Depot et Placement du Quebec, Montreal, which manages provincial pension and other assets to participate in the significant infrastructure program announce in the recent Budget.
But the pension plans' managers haven't announced any plans to participate in the new infrastructure initiative.
“Over the last few years, we've engaged with the federal government on infrastructure thinking,” Ron Mock, CEO of the Ontario Teachers' Pension Plan, said at a news conference March 30. “We're not unique. Other large Canadian plans have joined in those talks ... the federal government has talked to us all about what the right structure might be for large infrastructure investments.”
The question of structuring infrastructure investments to attract larger plan interest is a crucial one. Most of the pension plan investors have direct partial or full ownership in infrastructure, as opposed to participating in public-private partnerships, which have much more debt than equity. Infrastructure executives such as Andrew Claerhout, Ontario Teachers' senior vice president, infrastructure and natural resources, have said in the past that such partnerships, called PPPs or P3s, make large investments problematic for big plans like OTPP
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