BINDA: The government keeps mismanaging infrastructure

It’s hard to find a government megaproject that isn’t years behind schedule and billions over budget. 

That’s a problem because every dollar that goes towards cost overruns on megaprojects comes from taxpayers. 

Big cost overruns mean tax hikes, more debt, service rollbacks — or all three. Just take a look at the Massey Tunnel replacement between Richmond and Delta. 

The cost to replace the aging tunnel has more than doubled, from $4.2 to $8.5 billion according to Transportation and Transit Minister Mike Farnworth. Ottawa promised to cover a third of the cost, up to a maximum of $3 billion. That federal government bailout doesn’t even cover the overruns on the project.

The new tunnel is also nearly a year behind schedule and won't be completed until September 2031. 

The tunnel’s design hasn’t changed, that means the government can’t blame scope creep. Inflation has gone up an average of 3.76 per cent every year since the budget was set in 2021, so inflation isn’t to blame either. 

Mismanagement from the provincial government is why taxpayers are on the hook for massive cost overruns on big infrastructure projects time and time again. The problem has gotten so bad that it’s hard to find a project that hasn’t blown past its original budget. 

The Richmond Hospital Redevelopment is more than a billion dollars over budget and years behind schedule. The Surrey Langley SkyTrain extension is nearly $2 billion over budget and a year behind schedule. The Surrey Hospital is also years late and a billion dollars over budget. 

Instead of blaming single-digit inflation for triple-digit cost overruns, the provincial government needs to look in the mirror and start fixing the problems that keep driving up costs.

One place to start is by ending restrictive labour practices that freeze out most construction workers in BC. 

The government only allows hand-picked, unionized companies to work on most government building contracts. That drives up the cost to build things because it restricts the competition for projects. Only 15 per cent of construction workers in BC are affiliated with the unions who are able to work on most government building projects. 

Ending restrictive bidding practices is important because taxpayers can’t afford to pay for any more cost overruns. The government is already hiking taxes, adding debt and cutting services to pay for its financial mismanagement. 

Cost overruns have added $17.3 billion to the cost of capital projects since 2018 and delays now add up to 158 combined years, according to ICBA.  

A two-income family of four making $150,000 pays about $8,600 in provincial taxes every year. Those cost overruns are equivalent to about 200,000 families’ provincial tax bills for a decade. 

The province is hiking taxes by $4.2 billion over the next three years. Families and small businesses are paying billions more in income and sales taxes. 

The government is also cutting core services, several assisted living centres for seniors were delayed and canceled in the last budget. Funding for children living with autism is being slashed. 

BC has nearly doubled its per person debt since 2022. Every British Columbian now owes the equivalent of $32,500 towards the provincial government’s debt. Interest charges on that debt are costing us more than $125 million every week. 

The government needs to fix the conditions that keep pushing up the cost of infrastructure and start sticking to its own budgets. 

British Columbians can’t afford mismanagement and overruns adding to our tax bills.

Carson Binda is the BC Director for the Canadian Taxpayers Federation.