Even as Canada’s government boosted national infrastructure spending by 11% from 2015 to 2017 and launched the Canada Infrastructure Bank to attract and funnel private-sector project dollars, private investment declined 18% in the same period, says a report by a think tank at Ontario’s Western University.

Michael Fenn, visiting fellow in infrastructure at the school’s Lawrence National Centre for Policy and Management and a former province deputy minister, cites “uncertainty, particularly in the regulatory environment,” as a key private investment risk, especially for oil and gas pipelines. “It’s hard to know what reasonable expectation you have of being approved” in a timely manner or at all.

TransCanada Corp. in 2017 pulled the plug on its $12.5-billion Energy East pipeline amid regulatory roadblocks, including Quebec’s refusal to allow it through the province. The government bought the planned TransMountain pipeline for $3.35 billion after its developer gave up due to strong opposition in British Columbia. Private Canadian investors, including large pension funds, with a few exceptions, have yet to shift funds to domestic projects. The funds “do more investment outside the country than they do here” says Mahmood Nanji, Lawrence Centre director and a former pension fund executive.

That could change as the infrastructure bank makes good on a promise to leverage $26 billion in federal seed money into hundreds of billions in private capital. It has targeted a dozen unidentified infrastructure project proposals by private investors. The bank could aid links between pension funds and other investors and projects above $100 million that have revenue-generating components, says Nanji. All told, public dollars accounted for 63% of Canada infrastructure spending in 2017, according to the report. It also points to other issues that, if not addressed, could also hinder Canada’s efforts to overhaul the country’s infrastructure: “Competing priorities among levels of government and the lack of transparency about project-selection criteria among the various funding programs result in suboptimal project decisions,” the report contends.