The costs of building public projects have skyrocketed in the last decade, primarily driven by industry price hikes and regulatory obligations, a recent study reveals.
Commissioned by the Union of Quebec Municipalities (UMQ) and conducted by Raymond Chabot Grant Thornton (RCGT), the report presented in Montreal highlights significant cost surges across eight main categories of municipal projects. Between 2015 and 2025, these projects witnessed cost escalations ranging from 51% to 123%.
The UMQ initiated this research in response to the rapid escalation of construction costs outpacing municipal revenues and inflation rates. The study also points towards potential future spikes, citing recent raises in construction workers’ collective bargaining agreements.
While wage increases and material price hikes are key factors driving these cost escalations, regulatory demands also play a substantial role, mentions UMQ president and Mascouche mayor Guillaume Tremblay. He emphasizes the need to reassess and streamline certain standards to manage these soaring expenses effectively.
According to the report, regulatory compliance incurs additional annual expenses ranging from $900 million to $1.5 billion. Addressing these challenges is crucial to ensure sustainable and cost-effective municipal project execution.
