News release

May 2, 2007

Harper Government Proposes Sale of Federal Buildings, Numbers Add Up to a Bad Deal for Canadians

OTTAWA - The Public Service Alliance of Canada is calling on the Harper government to stop the sell-off of publicly-owned buildings. The federal government has just announced that it is going ahead with its plan to sell nine buildings, currently owned by the people of Canada, to the private sector.

“This process lacks any accountability and is a very bad deal for the Canadian public”, says PSAC National Executive Vice-President Patty Ducharme. “Canadians would not sell their houses and then rent them back again. Canadians own these buildings. Where is the sense in selling these valuable assets and then having to pay rent for them?”

PSAC members who work in government buildings know from experience that they can expect better conditions if the buildings they work in are owned and managed by the government instead of by investors whose primary concern is reaping a profit.

The public properties the government is selling are prime real estate. BMO Capital Markets and RBC Capital Markets' own promotional materials say that the “offering is one of the most significant real estate opportunities to come to the Canadian market. The Offering provides a unique opportunity for an investor to acquire nine high quality office properties leased back by the highest rated tenant in Canada.”

According to the PSAC, the sell-off will give private investors a license to print money. The government is guaranteeing that the buildings are debt free. Some buildings are new and some are recently renovated. Once the buildings are sold, for 25 years, the government will be forced to rent back the property it owns now.In the long run, it will cost the government – and Canadian taxpayers – considerably more than it will to operate the buildings they already own. Because the federal government can borrow money at a lower rate than the private sector it would be cheaper for the government to keep the buildings and pay for the cost of any repairs.

Even more alarming is the possibility that these nine buildings may be just the first wave in an even larger sell-off. This could create a future debt that Canadians don't want or need.

Ducharme says that not only are Canadians being fleeced, they're being fleeced in secret.  “BMO Capital Markets and RBC Capital Markets wrote the report advising the government to sell the buildings and now they are in charge of the tendering process. Not only is this an apparent conflict of interest, but the details of the contract are secret.”

When asked for the details of the contract, Minister of Public Works and Government Services Fortier said that he will inform Parliament after a decision is made because releasing the information in the report is subject to commercial confidentiality.

“Someone has to speak out about this crazy idea,” says-Ducharme. “I think that most Canadians would agree that this give away needs to be stopped now!”

For information:
Alain Cossette, PSAC Communications - 613-560-4317

17-020507