Prime Minister Justin Trudeau’s push to raise billions in private capital for infrastructure projects across Canada faces increased scrutiny in the wake of a new report questioning the proposal.

The Liberal government has yet to make an effective case for its proposed Canada Infrastructure Bank, with Ottawa able to borrow at lower rates for public works projects than private investors, the University of Ottawa’s Institute of Fiscal Studies and Democracy argues in a recently released report.

The report’s findings come as the House of Commons debates the Trudeau government’s proposed budget, with the planned $25.5-billion infrastructure bank having drawn fire from conservatives.

“What gap is this bank serving and what need is this bank serving?” are some of the questions now being raised in Ottawa about the proposed bank, said Randall Bartlett, the center’s chief economist. “It is very difficult to get an answer for that.”

Fellow report author Azfar Ali Khan, a director at the University of Ottawa center whose work focuses on boosting the performance of public sector organizations, contends Canada is effectively flying blind when it comes to determining where to deploy tens of billions in planned public works spending.

Canada has yet to do a comprehensive review of its infrastructure needs along the lines of what the Brtiain is doing with an official commission formed to weigh the nation’s construction needs.

“We really think this is a very first logical step,” Ali Khan said. “You want to make sure they are the best infrastructure investments  – that you will get the best bang for your buck in the big outcome areas the government has identified.”

The report also argues the federal government would be better off financially borrowing directly for various infrastructure projects than trying to recruit private investors.

“With yields on 30-year Government of Canada bonds currently sitting around 2.2%, the federal government can almost literally get ‘money for nothing,’” the report notes. “Nobody in the private sector can borrow at this rate over 30 years.”

Government borrowing should not be a concern right now for Canada, either, Bartlett argues, with the country’s finances highly rated and debt levels below that of Germany.

But critics who focus on borrowing costs are missing the large picture, according to Maxim Sytchev, a managing director and AEC-sector analyst at Toronto-based National Bank Financial.   

Teaming up with private investors takes some of the risk for new projects off the backs of taxpayers while also helping ensure the project itself is built and operated more efficiently, he said.

There is also a long and successful track record of public-private infrastructure partnerships, not just in the U.K. and Australia, but in Canada as well.

“It’s a very black and white argument, looking at sovereign implied interest rates as opposed to the private market,” Sytchev said.