Trudeau's new infrastructure bank ensures business profits from public services

Please chip in to support more articles like this. Support for as little as $5 per month!

Prime Minister Trudeau, Minister McKenna and Michael Sabia make an announcement on infrastructure funding, October 2020. Image credit: Adam Scotti/PMO

Governments are generally secretive about giving handouts to business, but the Trudeau government has come up with a particularly sneaky way to deliver corporate welfare -- through its Canada Infrastructure Bank (CIB).

This little-known business boondoggle is about to get much richer -- billions of dollars richer -- as Ottawa gears up for a binge of post-COVID spending to build infrastructure across the country, financed by its new bank.

Of course, municipalities badly need new infrastructure so the bank, endowed with $35 billion in public money to help finance infrastructure, should be a godsend.

But it isn't -- except for business and investors.

That's because of the business-friendly way the Trudeau government designed the bank. Municipalities that want the bank's financial support for an infrastructure project must "partner" with a private business.

These public-private partnerships (P3s) ultimately drive up the cost of the projects and leave municipalities with less control over their own infrastructure.

But if municipalities don't want to "partner" with business -- if they want instead to handle the projects themselves, raising the money through municipal bonds as they've traditionally done -- Canada's new public bank won't help them.

The township of Mapleton, Ont. recently got a taste of how tilted the bank is toward the interests of private business.

Like many municipalities, Mapleton needed to upgrade its water and wastewater systems. The CIB offered a $20-million debt-financing package, and proudly promoted Mapleton as a "pilot project" for its new model of financing municipal water projects.

But the $20-million financing package was aimed at ensuring the private partner achieved its profit targets, and offered nothing directly to the municipality.

When Mapleton township studied the deal carefully, it realized that it would be cheaper for the township to do the water project itself. So it cancelled the deal -- and received no help from the CIB.

All that Mapleton was left with was a $367,000 legal bill in connection with the CIB process.

But why didn't the CIB offer the $20-million subsidy directly to the municipality to help finance the project? Why must a private partner be involved?

What the CIB calls its "innovative financing model" is really a mechanism for directing taxpayer dollars to private companies so they can earn profits managing our infrastructure -- even though we can build and operate these projects more cheaply on our own.

What's the point of this bank -- besides ensuring businesses profit from our public services?

Certainly it's a far cry from the bank Justin Trudeau promised as a key plank in the 2015 Liberal election platform. During that campaign, Trudeau pitched the bank as a way to help struggling municipalities build needed infrastructure. He never mentioned municipalities would have to partner with businesses.

What Trudeau was describing back then sounded like European public banks, which clearly aim to advance the public interest.

Holland, for instance, has a public bank that helps finance local water projects by providing municipalities directly with extremely low-interest loans, as well as expertise in water management, according to David McDonald, a political economist at Queen's University and co-author of Public Banks and COVID-19.

But once in power, Trudeau designed his new bank with extensive input from Wall Street titan Larry Fink, head of the mega-investment firm BlackRock. Along with key figures from Canada's business and financial community, Fink pushed for a bank that would open up lucrative opportunities for investors.

But those lucrative opportunities mean Canadians will pay more for infrastructure, either through higher taxes or user fees.

As the Ontario auditor general has shown, involving the private sector drives up the costs of infrastructure projects. In a 2014 investigation of 74 projects, the AG found that the province's decision to partner with the private sector -- rather than building the infrastructure itself -- cost Ontarians an extra $8 billion.

The little township of Mapleton figured this out all on its own. So Mapleton (population 11,000) is now funding its water projects itself.

No longer hosting the CIB's pet "pilot project," the township has been abandoned by Trudeau's new bank, which has plenty to offer rich investors but nothing for the people of Mapleton.

Linda McQuaig is a journalist and author of The Sport & Prey of Capitalists: How the Rich are Stealing Canada's Public Wealth. This column originally appeared in the Toronto Star.

Image credit: Adam Scotti/PMO

Related Items

Thank you for reading this story…

More people are reading than ever and unlike many news organizations, we have never put up a paywall – at rabble we’ve always believed in making our reporting and analysis free to all, while striving to make it sustainable as well. Media isn’t free to produce. rabble’s total budget is likely less than what big corporate media spend on photocopying (we kid you not!) and we do not have any major foundation, sponsor or angel investor. Our main supporters are people and organizations -- like you. This is why we need your help. You are what keep us sustainable. has staked its existence on you. We live or die on community support -- your support! We get hundreds of thousands of visitors and we believe in them. We believe in you. We believe people will put in what they can for the greater good. We call that sustainable.

So what is the easy answer for us? Depend on a community of visitors who care passionately about media that amplifies the voices of people struggling for change and justice. It really is that simple. When the people who visit rabble care enough to contribute a bit then it works for everyone.

And so we’re asking you if you could make a donation, right now, to help us carry forward on our mission. Make a donation today.


We welcome your comments! embraces a pro-human rights, pro-feminist, anti-racist, queer-positive, anti-imperialist and pro-labour stance, and encourages discussions which develop progressive thought. Our full comment policy can be found here. Learn more about Disqus on and your privacy here. Please keep in mind:


  • Tell the truth and avoid rumours.
  • Add context and background.
  • Report typos and logical fallacies.
  • Be respectful.
  • Respect copyright - link to articles.
  • Stay focused. Bring in-depth commentary to our discussion forum, babble.


  • Use oppressive/offensive language.
  • Libel or defame.
  • Bully or troll.
  • Post spam.
  • Engage trolls. Flag suspect activity instead.