This Friday, the Prime Minister’s Office announced the appointment of Queen’s Chancellor Jim Leech, MBA ’73, to the position of Special Advisor to the Prime Minister on the Canada Infrastructure Bank.
“Mr. Leech brings with him immense knowledge and experience, and I am confident that he will help ensure a smooth and successful launch of the Canada Infrastructure Bank,” Prime Minister Justin Trudeau stated in the announcement released on the Prime Minister’s website.
“This is about making sure our public dollars go farther and are used smarter, as we make historic investments in infrastructure to create middle class jobs today and sustained economic growth for years to come.”
In an interview with The Journal on Tuesday, Leech explained that the Canada Infrastructure Bank is a product of the Fall Economic Statement issued by the Finance Minister last fall, and is part of an effort by the federal government to stimulate growth within Canada’s economy and job market.
As Special Advisor, Leech will be working pro bono to get the Bank off the ground and running.
“The Canada Infrastructure Bank is a relatively innovative and unique concept, and it is still just a concept — my job is to advise the Prime Minister on how best to set it up,” Leech said.
The Canada Infrastructure Bank is a relatively innovative and unique concept, and it is still just a concept — my job is to advise the Prime Minister on how best to set it up.
The purpose of the Bank is to attract private capital to partner with government tax payer dollars to improve what Leech calls “the economic backbone” of Canada — its infrastructure.
Leech explained that many private institutions today have a desire to invest in infrastructure, but don’t know how to go about handling the risks involved in building new bridges, airports, roads, etc. The government has a desire to start these new infrastructure projects, but requires capital to do so.
This disconnect between the public and private sector is the problem the Canada Infrastructure Bank will attempt to resolve.
The Bank’s purpose is to “help bridge that gap” because it “will absorb some of the risk” associated with launching new infrastructure projects that make private investors uneasy.
“The idea is that we will have 35 billion dollars of tax payer money to use to ‘prime the pump’ in order to get three, four, or five times that amount from the private sector,” Leech said. “The 35 billion will give you more like 100 to 150 billion because we’re bringing in third parties.”
Before starting in his position as Chancellor in 2014, Leech served as President and CEO of Ontario Teacher’s Pension Plan, the largest single-profession pension plan in Canada.
According to Leech, his past experience at Ontario Teacher’s Pension Plan revealed to him the fact that very little private capital has been invested into Canada’s infrastructure.
“It frustrated me to no end — maybe even dismayed me — that we had very little invested in [Canada’s infrastructure], because Canada has not really embraced private investment into public infrastructure,” Leech said.
It frustrated me to no end — maybe even dismayed me — that we had very little invested in [Canada’s infrastructure], because Canada has not really embraced private investment into public infrastructure.
Leech explained that Canada’s mantra has traditionally been that public infrastructure should be owned and paid for by the taxpayer — but it doesn’t necessarily have to be this way.
Many other countries have been very successful having private institutions investing in infrastructure. This arrangement not only frees up government money for other priorities, like health care, but also allows for the private sector to run projects “much more efficiently and effectively,” Leech explained.
His most crucial task, he said, will be to attract the right people to help govern the Bank.
According to Leech, a balance between third-party independents and government officials on the board of directors is crucial to ensuring that outside perspectives are met with accountability, and it’s important to ensure that each person involved is talented and experienced, since the project is so significant.
“[The Bank] is going to be dealing with all the largest financial institutions in the world,” Leech said. Leech hopes that by year-end, the Canada Infrastructure Bank will be up and running.
“It’s quite an honour that the Prime Minister would approach me to take on what could give Canada a real competitive advantage,” Leech said.
Leech has also served as Special Advisor to the Ontario Minister of Finance, and currently chairs the MasterCard and Toronto General and Western Hospital Foundations. He was made a Member of the Order of Canada in 2014 and was awarded the Queen's Diamond Jubilee medal in recognition of his work with the True Patriot Love Foundation in 2012.
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