The CDPQ Infra business model aims to foster effective execution of major public infrastructure projects. It allows CDPQ Infra to generate commercial returns while the government continues to be responsible for identifying proposed projects, determining the public interest to address, and approving the solution to implement on the basis of the options proposed by CDPQ Infra.
The model gives Caisse de dépôt et placement du Québec the opportunity to use its expertise to benefit Québec, to invest in tangible assets, and to implement global best practices to execute work on time and on budget.
An innovative model
The Québec government and la Caisse innovate in public infrastructure projects
Infrastructure at la Caisse
Over the past 15 years, la Caisse has invested in all key sectors and infrastructure markets. Through its experience acquired, from Australia to the United Kingdom, la Caisse has developed knowledge of global industry best practices to carry out projects with extensive discipline and efficiency.
A public transit operator in 15 countries and on 4 continents, Keolis transports more than 2.5 billion commuters annually. Since 2007, la Caisse has been one of two shareholders of the company. It participates in the major strategic decisions and supports the company in its strong growth.
The Canada Line
The Canada Line is the light rail transit system connecting Vancouver Airport with downtown. Built just prior to the 2010 Olympic Games, the train covers 20 km of rail and transports 120,000 commuters daily. La Caisse has been a shareholder since the beginning, in 2005. The project is considered one of the most successfully executed greenfield infrastructure projects in the country.
Heathrow Express is the fastest link between central London and Heathrow Airport. Each year, the train transports more than 5.8 million passengers. The system is exceptionally reliable at 98%. La Caisse has been a shareholder since 2006.
Eurostar is a provider of high-speed passenger train services, primarily between London – Paris and London – Brussels. It is the pre-eminent international high-speed rail operator in Europe with over 150 million passengers since services began in 1994. La Caisse has been a shareholder of Eurostar since 2015.
Announced in January 2015, the agreement concluded between the Québec government and Caisse de dépôt et placement du Québec determine's the government's responsibilities and those of CDPQ Infra, the governance structure and the projects' various stages of completion.
Adopted on June 12, 2015 by the Assemblée nationale du Québec, Bill 38 authorizes the implementation of CDPQ Infra’s business model.
Frequently asked questions
First of all, CDPQ Infra is a public institution. Its returns benefit all Quebecers.
Second, contrary to PPPs, projects entrusted to CDPQ Infra will be excluded from the governments’ balance sheet.
Finally, contrary to other existing arrangements, the planning, financing, execution and operation stages will be managed in an integrated manner by a single institution.
CDPQ Infra will review the potential for profitability of each project submitted by the government. It is understood that CDPQ Infra will only undertake those projects with potential to generate returns.
In the event that CDPQ Infra moves forward with execution of a project, its profitability will depend on a number of factors, including CDPQ Infra’s ability to deliver on budget and on schedule. During the exploitation phase, operational efficiency will be a determining factor in projects’ profitability.
CDPQ Infra’s goal is to keep rates as low as possible to maximize traffic on these new infrastructures.
With 15 years of investments in all key sectors and markets, la Caisse has developed world-class expertise, solid teams and a leading network of partners.
Expertise in public transit
La Caisse has several public transit assets in its portfolio.
In the United Kingdom, la Caisse is a shareholder in Eurostar, which offers high-speed passenger train services, primarily between London and Paris and London and Brussels, running through the Channel Tunnel, in Heathrow Express, the rail service linking Paddington Station and Heathrow Airport, and in Gatwick Express, the fast train linking central London and Gatwick Airport.
La Caisse is also one of two shareholders in Keolis, a global public transit operator active in 15 countries around the world and transporting more than 2.5 billion commuters each year, in major urban centres ranging from Melbourne to Boston.
Expertise in greenfield projects
Over the years, la Caisse has also participated in several projects involving execution and operation of new infrastructure. For example, in 2005, la Caisse participated as a lead investor in the construction and operation of The Canada Line, the rapid-rail service connecting the Vancouver Airport with downtown. Completed on schedule and on budget, the project is considered today one of the most successful greenfield infrastructure projects in the country.
The role of owner of major projects has been part of la Caisse’s DNA for a long time: its subsidiary Ivanhoé Cambridge, which manages $40 billion in real estate assets, has planned, financed, constructed and managed real estate around the world for decades.
Yes. La Caisse’s independence is explicitly reaffirmed in bill 38. La Caisse alone will decide whether to invest in infrastructure projects, based on the interests of its clients and each project’s expected profitability. Moreover:
- For accounting purposes, if an asset is to be excluded from the public balance sheet, the government cannot get involved in its management in any way. This is something to which the Auditor General of Québec will pay close attention.
- In the infrastructure industry around the world, projects are always financed through partnerships. If a government tried to impose an unprofitable project on la Caisse, potential partners would refuse to come on board.
- The profitability of projects managed by la Caisse will be visible to all. An independent expert will validate whether the expected profitability meets market standards for comparable projects.
The CDPQ Infra model allows for the execution of major, modern and efficient infrastructure projects that will benefit all Quebecers.
For la Caisse, it is a way of investing for the long term in tangible assets that generate stable, predictable returns for its clients, while contributing to Québec’s economic development.
Under this model, works will continue to be controlled by a public institution, but will have a limited impact on Québec’s finances.
Calls for tender will comply with global best practices and the highest standards for transparency, competition and efficiency. An independent auditor will also review the integrity of the tendering process.
As controlling shareholder, CDPQ Infra will encourage vigorous competition to control costs and access the best technical and technological solutions.
Finally, contracts for supplies, services or construction work worth $5 million or more will be granted to companies authorized by the Autorité des marchés financiers.
CDPQ Infra will carry out all required consultations, analyses and assessments, in accordance with current legislation and in a spirit of full collaboration with the various stakeholders.
Yes. In accordance with global industry practices, major infrastructure projects are carried out by several financial partners that share risks and responsibilities.
CDPQ Infra will work with partners that share its long-term approach and that can contribute their capital and expertise. CDPQ Infra will remain the controlling shareholder of projects.