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The company that cleans the Royal Ottawa Mental Health Centre, makes the food, runs the laundry, cuts the grass and fixes the building is being liquidated, but patients and staff shouldn’t notice much difference, the hospital’s chief financial officer says.
Carillion, a British company with 6,000 workers in Canada, announced Monday morning that it’s going bust, owing the equivalent of $3.5 billion in debt and pension obligations and unable to get more credit.
Besides the non-medical services at the Royal Ottawa and other hospitals across Ontario, Carillion maintains provincial highways (including plowing and salting them in the winter) and maintains the housing at CFB Petawawa. It also has similar operations in Alberta; in all, it maintained about 40,000 kilometres of Canadian roads.
“As of today, it’s business as usual,” said Cal Crocker, the hospital’s CFO and executive vice-president. He and hospital executives have known for a while that Carillion was in bad shape, he said. “We have followed up with Carillion looking for more details and also followed up with our external legal counsel. But as of today, no change in operations. The contracts are in place.”
Carillion’s Canadian subsidiary is just part of a 43,000-person global conglomerate that specialized in taking over services governments want to contract out. The British government is keeping the company going temporarily, promising to pay the bills to keep Carillion’s public customers in the U.K. served. It’s not clear whether the promise extends to Carillion’s overseas operations.
The British parent’s website said Monday it was under British government receivership; sites for its Canadian and Middle East subsidiaries said nothing about their current conditions. A Toronto spokesman didn’t respond to a call or an email.
The company’s work at the Royal Ottawa was unusual when it started in the early 2000s. Carillion was part of a consortium that won a bid for a public-private partnership to completely rebuild the Carling Avenue hospital, finance the work, maintain the structure and provide all the housekeeping and related services.
The deal, and a similar one for a new general hospital in Brampton, were groundbreaking and controversial at the time. The Progressive Conservatives under Ernie Eves struck the first deal; Dalton McGuinty and the Liberals accused them of privatizing health care and of borrowing money on the sly, hiding the costs of new hospitals in promises to pay fees for decades rather than just taking on debt.
Then-premier Ernie Eves toured the Royal Ottawa Hospital in fall 2003. Rebuilding it into the Royal Ottawa Mental Health Centre through a public-private partnership was a major Progressive Conservative project in the early 2000s.
The idea that the private partner that does the cleaning, maintenance and food service might vaporize was not one of the major worries at the time. If anything, taxpayers were supposedly overpaying, making investors rich with money that didn’t need to be spent. In office, the Liberals made revised deals that kept the ownership of the hospitals in public hands, though otherwise the basic arrangement didn’t change much.
The hospitals were part of a first wave of public-private partnerships in Ontario. They’re now standard practice for large infrastructure jobs, including the $2.1-billion light-rail line Ottawa expects to open later this year; a consortium of companies with different specialties is designing, building, financing and maintaining the system on a decades-long contract.
For the $100-million new Royal Ottawa, pension funds put up the money. EllisDon did the building. Carillion was the partner that stayed for the long-term operations. In exchange, the hospital makes an array of annual payments under 25-year contracts. The contracts for Carillion’s services are worth about $7 million a year, Crocker said, plus $4 million in “flow-through” payments for things like the gas and electric bills.
The key today, Crocker said, is that the consortium, called The Healthcare Infrastructure Company of Canada (or “THICC”) is the entity the Royal Ottawa has a contract with. If Carillion Canada disappears, that’s not legally the hospital’s problem.
“Our sense, organizationally, is there will be another company, whether it’s a Canadian company or somebody else, that will buy at least the health-care business in Canada and become a new partner in THICC,” Crocker said. “Or one of the current partners will. That’s just our sense — we have no direct knowledge.”
Other players in the market include giants like Aramark and Compass, he said. Somebody will want the business.
Meanwhile, the Ministry of Transportation is trying to figure out what will happen with Carillion’s road-maintenance contracts. It hold eight of Ontario’s 20 maintenance contracts, though the one closest to Ottawa is in the region around Bancroft. They’re worth about $81 million a year.
A Carillion plow and sander on an Alberta highway.
“We are actively exploring options to make sure Ontarians will continue to receive the winter maintenance that they both expect and deserve — regardless of what is happening overseas with Carillion U.K. ? — and will provide an update as soon as possible,” said ministry spokesman Bob Nichols.
Carillion has had trouble meeting standards for plowing and snow clearing. The ministry fined it $900,000 in 2014 and it faced a fresh investigation after a series of crashes on Toronto-area highways in 2016. Auditor general Bonnie Lysyk examined winter maintenance on Ontario highways in 2015 and followed up the next year; she never mentioned Carillion by name but noted that the government has a habit of picking the lowest bidder for plowing contracts without checking that the winner is up to the job.
Last fall, Carillion and the government jointly cancelled at least one road contract in the Muskoka area. By that time, Carillion’s British parent had already said twice it was in financial difficulty — once in July and again in early September.
dreevely@postmedia.com
twitter.com/davidreevely
查看原文...
Carillion, a British company with 6,000 workers in Canada, announced Monday morning that it’s going bust, owing the equivalent of $3.5 billion in debt and pension obligations and unable to get more credit.
Besides the non-medical services at the Royal Ottawa and other hospitals across Ontario, Carillion maintains provincial highways (including plowing and salting them in the winter) and maintains the housing at CFB Petawawa. It also has similar operations in Alberta; in all, it maintained about 40,000 kilometres of Canadian roads.
“As of today, it’s business as usual,” said Cal Crocker, the hospital’s CFO and executive vice-president. He and hospital executives have known for a while that Carillion was in bad shape, he said. “We have followed up with Carillion looking for more details and also followed up with our external legal counsel. But as of today, no change in operations. The contracts are in place.”
Carillion’s Canadian subsidiary is just part of a 43,000-person global conglomerate that specialized in taking over services governments want to contract out. The British government is keeping the company going temporarily, promising to pay the bills to keep Carillion’s public customers in the U.K. served. It’s not clear whether the promise extends to Carillion’s overseas operations.
The British parent’s website said Monday it was under British government receivership; sites for its Canadian and Middle East subsidiaries said nothing about their current conditions. A Toronto spokesman didn’t respond to a call or an email.
The company’s work at the Royal Ottawa was unusual when it started in the early 2000s. Carillion was part of a consortium that won a bid for a public-private partnership to completely rebuild the Carling Avenue hospital, finance the work, maintain the structure and provide all the housekeeping and related services.
The deal, and a similar one for a new general hospital in Brampton, were groundbreaking and controversial at the time. The Progressive Conservatives under Ernie Eves struck the first deal; Dalton McGuinty and the Liberals accused them of privatizing health care and of borrowing money on the sly, hiding the costs of new hospitals in promises to pay fees for decades rather than just taking on debt.
Then-premier Ernie Eves toured the Royal Ottawa Hospital in fall 2003. Rebuilding it into the Royal Ottawa Mental Health Centre through a public-private partnership was a major Progressive Conservative project in the early 2000s.
The idea that the private partner that does the cleaning, maintenance and food service might vaporize was not one of the major worries at the time. If anything, taxpayers were supposedly overpaying, making investors rich with money that didn’t need to be spent. In office, the Liberals made revised deals that kept the ownership of the hospitals in public hands, though otherwise the basic arrangement didn’t change much.
The hospitals were part of a first wave of public-private partnerships in Ontario. They’re now standard practice for large infrastructure jobs, including the $2.1-billion light-rail line Ottawa expects to open later this year; a consortium of companies with different specialties is designing, building, financing and maintaining the system on a decades-long contract.
For the $100-million new Royal Ottawa, pension funds put up the money. EllisDon did the building. Carillion was the partner that stayed for the long-term operations. In exchange, the hospital makes an array of annual payments under 25-year contracts. The contracts for Carillion’s services are worth about $7 million a year, Crocker said, plus $4 million in “flow-through” payments for things like the gas and electric bills.
The key today, Crocker said, is that the consortium, called The Healthcare Infrastructure Company of Canada (or “THICC”) is the entity the Royal Ottawa has a contract with. If Carillion Canada disappears, that’s not legally the hospital’s problem.
“Our sense, organizationally, is there will be another company, whether it’s a Canadian company or somebody else, that will buy at least the health-care business in Canada and become a new partner in THICC,” Crocker said. “Or one of the current partners will. That’s just our sense — we have no direct knowledge.”
Other players in the market include giants like Aramark and Compass, he said. Somebody will want the business.
Meanwhile, the Ministry of Transportation is trying to figure out what will happen with Carillion’s road-maintenance contracts. It hold eight of Ontario’s 20 maintenance contracts, though the one closest to Ottawa is in the region around Bancroft. They’re worth about $81 million a year.
A Carillion plow and sander on an Alberta highway.
“We are actively exploring options to make sure Ontarians will continue to receive the winter maintenance that they both expect and deserve — regardless of what is happening overseas with Carillion U.K. ? — and will provide an update as soon as possible,” said ministry spokesman Bob Nichols.
Carillion has had trouble meeting standards for plowing and snow clearing. The ministry fined it $900,000 in 2014 and it faced a fresh investigation after a series of crashes on Toronto-area highways in 2016. Auditor general Bonnie Lysyk examined winter maintenance on Ontario highways in 2015 and followed up the next year; she never mentioned Carillion by name but noted that the government has a habit of picking the lowest bidder for plowing contracts without checking that the winner is up to the job.
Last fall, Carillion and the government jointly cancelled at least one road contract in the Muskoka area. By that time, Carillion’s British parent had already said twice it was in financial difficulty — once in July and again in early September.
dreevely@postmedia.com
twitter.com/davidreevely
查看原文...
