P.E.I. capital building project costs have ballooned by $69M: audit

Prince Edward Island's provincial flag flies on a flag pole in Ottawa, Monday, July 6, 2020.

The costs of 11 capital building projects in Prince Edward Island have ballooned by $69.1 million, according to a new report from the province’s auditor general.

The audit, which looked at 12 projects between April 2020 and March 2025, found the total cost grew from $81.5 million to $150.6 million, which represents an 85 per cent increase.

Only one of the 12 projects came in under budget.

“Clear and reliable capital budgeting information helps legislators understand project costs and set realistic spending limits,” said Auditor General Darren Noonan in a news release. “Without it, unexpected cost increases can result in more borrowing, rising net debt, and weakened confidence in the capital planning process.”

The audit noted the province’s capital budget for the 2026-2027 fiscal year was $486.5 million, up from $274 million five years earlier.

The 12 projects included in the audit were:

• renovations at Coles Building (went 473 per cent over original estimate and cost $2 million)
• Ecole Sur Mer (went 167 per cent over original estimate and cost $14 million)
• new women’s unit at provincial correctional centre (went 126 per cent over original estimate and cost $18 million)
• Eliot River School (went 153 per cent over original estimate and cost $14 million)
• Sherwood School (went 97 per cent over original estimate and cost $33 million)
• Montague Consolidated School (went 64 per cent over original estimate and cost $10 million)
• Bridgetown Depot (went 56 per cent over original estimate and cost $14 million)
• Queens County Depot (went 54 per cent over original estimate and cost $23 million)
• new exit stairwell at Sullivan Building (went 70 per cent over original estimate and cost $2 million)
• fifth floor renovations to Sullivan Building (went 50 per cent over original estimate and cost $2 million)
• West Royalty School (went 21 per cent over original estimate and cost $5 million)
• a pandemic building surplus warehouse (went eight per cent under original estimate and cost $2 million)

The audit noted a large portion of the cost increases were discovered during the pre-design and design phases of the projects.

“Specifically, $29 million—representing 42% of the total $69.1 million increase in project costs—were identified before the first construction tenders were issued,” the audit reads. “The remaining cost increases were incurred as projects progressed through the construction phase.”

The audit recommended the Department of Transportation, Infrastructure and Energy, and the Treasury Board, have policy guidelines that outline minimum standards for project planning that need to be met before capital building projects are included in budget submissions.

It also recommended post-completion reviews of all capital projects that cost more than $2 million.

The auditor general said the provincial government accepted all the recommendations.

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