Privatize city hall

Lawrence Solomon
Financial Post
August 10, 2009

It’s time to shed the dead weight of the bureaucracy.

Toronto’s municipal strike is over. Some 30,000 garbage and other workers are back on the job. That’s at least 15,000 too many.

If the strike has taught Torontonians anything, it’s that the city does precious little for its residents. Now that the garbage is finally being picked up, Torontonians want to clean up the mess at City Hall. Most hold the Mayor in low regard, most hold the councillors in low regard, most hold the strikers in low regard, and most want to privatize garbage collection.

But why stop with outsourcing garbage services? Private firms can and should take over the many other functions that city workers have grabbed from private-sector firms who would treat city customers with more respect, and at lower cost. Striking 15,000 to 20,000 workers from the city payroll will not only improve the quality of city services, doing so will also lower taxes and create jobs throughout the wider city economy.

In the case of garbage collection, private-sector workers, who tend to be fitter and better managed, collect two and a half to three times as much garbage per person per hour as city workers. With garbage collection in private hands, not only would strikes disappear but streets will be cleared of garbage more quickly and traffic will be less disrupted. Exit 6,000 workers. Bonus: Toronto will also pocket a small fortune by selling its trucks and other garbage infrastructure.

The case for privatizing Toronto’s bloated water and sewage operations is also a slam dunk — other cities that have done so saw savings as high as 50%. CUPE has not only opposed water privatization in the past, it even objected to the city applying its Works Best Practices Program to its water and sewage operations. Little wonder — this program found that the city’s sewage system would run better without 400 of its 907 workers. By placing the city’s water and sewage works under the management of the most efficient operators, Toronto taxpayers not only stand to save $100-million, according to an estimate from United Water in 2001, but the unjustifiable hikes that we’ve seen in water rates would be staunched, along with many of the 1,500 water-main breaks the city suffers each year. Exit 1,500 workers.

Next, privatize the hugely inefficient Toronto Parking Authority. Although it is the largest in the continent, with 20 parking garages and 140 surface parking lots, it provides a pittance in revenue to the city, partly because it subsidizes parking for neighbourhoods that are politically well connected at the expense of neighbourhoods that aren’t. And partly because of its featherbedding and its wage levels — more than one-third of the monies that Torontonians pay in parking tickets or feed into parking machines feeds the parking authority’s payroll. Privatizing the parking authority would also help public transit compete against the car, because the parking authority subsidizes lots near subway stations. Exit 400 workers. Another bonus: The city would pocket hundreds of millions of dollar through the sale of the parking authority’s real estate and other assets.

The list of city-run enterprises that have no business being in municipal hands — and whose privatization has been urged by urban advocates such as Toronto’s own Jane Jacobs — goes on and on. They include the inefficient city-owned power company that gouges city customers with unjustifiably high fees, the city-owned transit company that has failed to provide the citizenry with affordable service, the city-owned houses and apartment blocks that so often become centres of despair, and the city-owned district heating operation that for decades has failed to use energy efficiently.

Privatizing these operations would lead to a more humane city, a more prosperous city, and a more environmentally friendly city. But why stop there?

The city’s own Prosperity Agenda and the Blueprint for Fiscal Stability and Economic Prosperity laments its under-utilized real estate holdings, which it conservatively values at $18-billion. It knows these holdings must be properly employed, in order to create employment and “regenerate Toronto.” Sell these off, too, and use the proceeds to cut taxes and provide the services that more suit cities, such as providing libraries, parks, policing and fire protection.

During Toronto’s 39-day strike, and garbage services aside, many remarked on how surprisingly well the city seemed to run, given that it lost so much of its vast workforce. The city didn’t much need its Mayor and councillors either — and Torontonians didn’t get many services from these “leaders” — because of these politicians’ reluctance to cross picket lines to attend municipal meetings. The city, in truth, is its citizenry. And the citizenry generally does best when it doesn’t need to carry the dead weight of the bureaucracy.

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