1. Why shouldn't we let the private sector build and operate hospitals? Can't private companies do it cheaper than government?

There is no evidence that private companies can build and run hospitals (or any other public service) cheaper than government. In fact, all the evidence is that the private sector is more costly when it comes to essential public services like health care, hydro, public transit and education.

There are two reasons the private sector is more expensive than the public sector. The first is interest rates. Any government in Canada can borrow money at a lower interest rate than even the largest corporation. Since hospitals and other public facilities are always built with borrowed money (like a mortgage) even a small difference in interest rates means a lot of money over time.

The second reason is profit. A private company needs profit to survive. And the profit must be high enough to attract investors. In the U.S. profit-driven health care system, costs are much higher than in Canada and other countries with a public not-for-profit system.

2. But doesn't the private sector look for more "efficiencies" in order to make more profit? Doesn't efficiency balance out the profit?

There is no evidence for this claim. It may work for hamburgers but certainly not for health care or other public services. How do you look after more children with cancer or more seniors with Alzheimer's. What "efficiencies" will lower those costs?

There are two ways that the private sector can claim to deliver the public services at a lower cost. The first is to reduce the level of services. It may not seem important that there are not as many people to clean a hospital - thereby saving money - until infections start to kill people in the hospital. In the U.S. where privatization of cleaning and housekeeping services in health care is more widespread than in Canada, cuts in cleaning and infection control standards contributed to 103,000 patient deaths in 2000

The second way is to impose "user fees", which means making people pay for a service that used to be provided at no cost.

3. What's wrong with "user-fees" for public services? Shouldn't people who enjoy the benefit pay for it?

User fees for some services, such as hydro and public transit, are fine as long as they are fair to all users. But user fees for some services are a bad idea. Health care is the best example: User fees stop many people from getting health care when they need it.

It's much cheaper to prevent a disease than treat it. For example, what would happen if everyone had to pay for their flu shots? Many would not get one. If they then got flu, they would pass it on to others.

People would not get medical care soon enough if they had to pay for it. Many would get worse and the cost of treating them would be much higher.

4. Doesn't government bureaucracy and waste make services more expensive?

Health insurance is a good example of useless waste in the private sector. In the private health insurance system of the United States 'paperwork' costs over $1,000 per person per year. In Canada's public health insurance system, the cost is about $300 per person per year.

Nearly 14 percent of all the money spent in the U.S. last year went towards health care. In Canada, it is less than 10 percent. This means that Americans spend almost 40 percent more on health care than Canadians. But even though Americans spends much more on health care than Canadians, 45 million Americans do not have any health insurance. That's more than the entire population of Canada, where everybody has health insurance.

The high number of Americans without health insurance is probably why the United States ranks 21st in life expectancy, just below Portugal. Canada ranks 9th.

5. If privatization is such a bad deal, why do some politicians say it's a good idea? What's in it for them?

Privatization can make a government look good in the short term (on paper) by hiding the real long-term costs of a service. It's an accounting trick, like the difference between renting and buying a house.

If you only look at the monthly payments, it seems smarter to rent a house than to buy it. Since you do not have a mortgage, you have no 'debt.' But once the mortgage is paid off, your living costs are much cheaper. It's the same with public hospitals. It may seem better to have lower public debt, but in the long run, we'll pay much more for that hospital.

6. Aren't unions opposed to privatization only because it will cost jobs?

No. While it is important to keep jobs (unemployment is very expensive for society) it is more important to ensure good quality health care. That takes people. Anyone who has been in a hospital in recent years knows that there are not too many health care workers, there are too few. That's why there are long waits in hospital emergency departments and even longer waits for surgery.

A well-run public health care system will plan ahead to ensure that there are enough health care workers in the future. A private operator will not invest in training more nursing aides, for example, than it needs right now. When there is a shortage of workers, patients suffer.

7. Maybe unions are just worried that a private company will keep their wages down. Isn't it easier to get government to pay more?

No. Wages increases in the public sector, including health care, have been lower than the rise in the cost of living for many years. Governments are tough negotiators. In Ontario, this has led to a shortage of skilled workers in many critical health care areas.

If anything, wages must rise if we are going to be able to deliver quality health care. A shortage of nursing staff has led to the closure of thousands of hospital beds. This is why many people have to wait very long times for surgery.

The private sector pays administrators much more than the public sector. In the United States, top administrators in private hospitals are paid an average of $500,000 (Cdn), well over twice what they would be paid in a Canadian hospital.