He said: Mr. Speaker, I rise today at third reading of Bill C-14, the proposed Canada Transportation Act. This is an important bill. It introduces new framework legislation that touches every transportation mode. It represents the culmination of several years of effort on the part of the Department of Transport.
It has been at times, as all hon. members know well, a controversial bill. One of the first tasks that I set myself this year as the newly appointed Minister of Transport was to review the proposed legislation and assess for myself whether or not an appropriate balance had been achieved between the varied interests that are affected by the elements of the bill.
After careful consideration and an analysis of the bill, I have concluded that it is a balanced piece of work. It clearly reflects the hours of consultation and careful analysis that have been invested in it over the past few years.
On that basis, I am very pleased to move this bill forward today. It is an act which will truly bring the Canadian transportation industry into the 21st century.
[Translation]
I think it is also important to set this bill in a broader context. It really lies within the scope of our government's policy strategy, which is to streamline and modernize our transportation industry.
Given the importance of transportation in the Canadian economy and for Canada's competitiveness on the world markets, this bill will enhance the nature of trade, viability and competitiveness of transportation.
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In drafting this bill, the government took into consideration reports from independent commissions, previous work of the Standing Committee on Transport and the report produced by a task force on marketing headed by the hon. member for Kenora-Rainy River, whom I wish to thank for his great work.
To develop Bill C-14, the government asked itself what those concerned could and should do on the market, which issues would better be left in the hands of the regulatory body and which should be debated by elected representatives.
The opinions weighed as part of this process were many and varied. Finally, the government decided on what it felt should be a new balance, a balance between regulatory protection and trade negotiation as well as between supervising an agency and giving transportation companies more freedom in managing their own business.
Over the summer, the government heard from many stakeholders, who were concerned about certain aspects of the bill. Recognizing that any legislative enactment can always be improved on, it identified several potential changes.
Then, the Standing Committee on Transport carried out an exhaustive review of the bill. It also heard evidence from many stakeholders at this stage. Nearly 100 testimonies were submitted, and I understand that an even large number of briefs were received. All those who took the time and made an effort to take part in this complex process deserve our thanks.
I would like to emphasize the huge contribution made by the members of the committee and many other members who also participated in the bill's consideration during 55 hours of direct evidence.
[English]
As evidence of this effort, over 80 amendments to Bill C-14 were made. Some were technical changes. Others were complex and in some instances they reflected differing and difficult choices among competing stakeholders' points of view. However, in all cases, these amendments reflected the careful thought and deliberation that members brought to the legislative process.
As this effort indicates, it is an important bill. It updates or removes economic regulation of transportation modes. For example, alternative means of transportation have made additional regulation of northern air services unnecessary.
We are also modifying the degree of regulatory oversight on northern marine services and regulation of commodity pipelines has been transferred to the National Energy Board.
Turning to the rail sector, I must emphasize that enhancing the viability of the rail industry is a key objective of the legislation. It will set in motion the steps necessary to ensure an effective and viable rail system in this country.
The rail elements of the legislative package complement the strategy of commercializing the CN but they are far broader than that single initiative. They are about enhancing the long term viability of the whole Canadian rail industry. It is important to note that this bill will affect the operations of approximately 31 railways currently operating in Canada.
When the government took office two and half years ago, the two national railways were suffering the effects of a number of structural problems: low labour productivity, under capitalization, excess trackage, to name a few. This had occurred despite considerable work by both railways to reduce costs by various belt tightening measures. Despite being hampered by onerous regulations, both railways have managed to rationalize, reorganize and downsize since 1993.
Outmoded employment security provisions were changed by an arbitration decision rendered last June. Some provincial legislatures have helped out, like my home province of British Columbia, among others. British Columbia recently passed legislation which significantly reduced provincial taxation on railways. Ontario has eliminated its successor rights provisions which applied to the sale of former federal track. I applaud those initiatives.
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The federal government decided that it also had to act decisively to put the railways on a more secure financial footing. Commercialization of CN and more important, regulatory reform are directed to this goal. We are moving on this to ensure that we have a viable coast to coast system. In a country reliant on the export of resource materials, a healthy rail sector, the principal carrier of bulk commodities, is an extremely important key to our trading future. A healthy rail industry best serves all stakeholders, not just the railways themselves.
The current system is overbuilt. CN and CP cost cutting efforts have been stifled by the regulatory hurdles that they must jump over to tailor rail line networks to their core markets. At the same time, there have been few incentives in the existing system to market little used lines to the newer short line railways.
Railways must reduce trackage if they are to regain their true financial health. Eighty-four per cent of CN and CP traffic travels on one-third of their networks. It is estimated that some 50 per cent of current CN and CP track is surplus to the main carrier needs as they move to serve their core markets.
The traffic density of the Canadian rail network is presently much less than that of the top seven United States railroads. This means that by moving to similar densities in the range of the United States companies, our major carriers could generate significant savings.
[Translation]
One of the key objectives of this bill to put in place measures to streamline the current regulatory process in relation to the sale, lease or abandonment of lesser used lines. An equally important objective will be the incentive effect it will have on the legislation to establish shortline railways at a lesser cost on many of these lines.
The dramatic increase in the number of shortline railways in the U.S. is one of the major economic achievements of the 1980s. Nothing stops this scenario from being repeated in several regions of Canada, once those elements of the railway transportation legislative framework that did not foster the creation of shortline railways have been removed.
These past 10 months, the concerns raised by shippers and by our two main railway companies have been at the centre of the debates on the transportation bill.
The bill before us today is the product of the contributions made by various stakeholders-officials, interested parties, my colleague the former Minister of Transport, and more recently, the members of the standing committee-toward striking the right balance between their respective interests.
[English]
Have they succeeded? This is a question I have asked myself in reviewing this very complex legislative initiative in the two months since I became minister.
First and foremost, Bill C-14 preserves all the key shipper rights won through the National Transportation Act, 1987. These rights are unique to the rail mode and are more extensive than the rights available to shippers in other jurisdictions, particularly in the United States.
To illustrate, the bill keeps regulated rates for captive shippers and adapts them for short line railways. The bill keeps the statutory right of a shipper to final offer arbitration, shortening the process at the shipper's request and extending it to cover rail passengers and commuter service. This bill keeps the provision for confidential contracts between a railway and a shipper.
[Translation]
The decrease in railway prices-nearly 30 per cent since these rates were introduced in 1987-show how much shippers have benefited.
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In addition, the bill preserves the traditional obligation of carriers to provide an adequate level of service, or what is commonly referred to as mass transit conveyance obligation, specifying the duties to be fulfilled by a railway in terms of traffic accommodation.
If a complaint is filed, the agency can always order the railway to take corrective measures. No other mode of transportation has this kind of obligations.
The bill also preserves the statutory right of a federal railway to operate on tracks other than federal tracks. This right enhances even more the competitive access of shippers.
Still, in spite of all these measures, shippers have asked the government to make more changes to the bill.
[English]
It is well known that shippers wanted section 27(2) deleted, whereby the agency would take into account whether a complainant would suffer substantial commercial harm in deciding whether a regulated remedy was warranted. Because many shippers objected to this provision, the government advanced amendments which replaced the term ``significant prejudice'' which was formerly used with the term ``substantial commercial harm''. Other amendments clarify the intent and application of the new terminology. These were two main concerns of the shippers.
Shippers also wanted section 34(1) deleted. This section stipulated that any party to a dispute, which would include railways, must pay the costs if the complaint or behaviour during the conduct of the proceedings was found by the agency to be frivolous or vexatious. Again amendments were made to address the shippers' concerns.
Section 27(2) was rewritten and clarified by government members of the committee and was subsequently adopted unanimously by the standing committee.
Section 34(1) was dropped.
Shippers also wanted section 113, which is now section 112 of Bill C-14, to be deleted whereby the agency would be required to set rail rates and conditions that are commercially fair and reasonable. I find it very hard to accept any argument that a regulated result should not be commercially fair and reasonable. This section however was subsequently clarified to specify that the result must be commercially fair and reasonable to all parties.
[Translation]
Initially, some shippers also wanted to extend to provincial railways the compulsory and mandatory running rights. We have concluded that this was both problematical and unnecessary, and could hinder the development of shortline railways.
I am convinced that this long process has provided an opportunity to review carefully all shippers' concerns and that action was taken regarding several of these concerns. I think that the outcome will be profitable to shippers as well as railways.
We must bear in mind some of the principles underlying the bill. Regulation should be a last resort, since solutions that are freely and mutually agreed upon are the best. A balance must be struck between sometimes incompatible concerns.
Railway companies have one main goal: viability, a goal which is also in the best interest of shippers and-I must say-in the best interest of Canadians as well.
Our common goal is to have a viable railway system, consisting of main carriers and shortlines, which will ensure that railway service will continue to connect as many communities as possible across the country.
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[English]
To sum up, the objectives for rail which the bill meets successfully are: to promote the long term viability of railways; to foster the creation of short lines; to preserve key shipper rights; to preserve rail service to communities to the extent possible; and to reduce the regulatory burden on railways. It has been an enormous undertaking.
In easing the regulatory burden that had been placed on rail in the past, over 1,000 pages in various statutes have been reduced to just 100. In doing so the bill lifts regulatory intrusions into the railways' day to day business affairs. Most important, the bill streamlines the rail line rationalization process. This is the most effective legislative means of bolstering the railway's efforts to cut costs.
[Translation]
This way, if a buyer comes along, a railway can sell one of its lines without delay to another railway, which will continue to operate it. In the absence of an immediate buyer, the bill provides for a simple process to dispose of surplus rail lines, by encouraging their sale or lease to shortline railways.
However, if sufficient notice has been given and no private or government buyer wants to buy the line, the railway will be authorized to sell it as it pleases.
All concerned, including main railway lines, will benefit from efforts to foster the creation of shortline railways.
The public interest will be protected since the government will have the option of buying a line that no one else wants to operate for rail purposes. This is indeed the best way to promote the continued operation of a viable system from coast to coast.
[English]
During the committee's review of the bill, concerns were raised by some about the length of time for governments and others to react when a line might be discontinued. These concerns have been addressed through amendments to lengthen somewhat the time lines at the beginning and the end of the process. For instance, each level of government will now have up to 30 days to purchase a line rather than 15 days in the original bill. Amendments such as the example I have cited demonstrate the government's flexibility and resolve to make this important piece of legislation both effective and fair.
I feel that the bill as now drafted represents an admirable balance. The standing committee and all its members from all parties in the House is to be commended for its excellent work. It is an example of how well the standing committee process can work and how it can handle extremely complex legislative tasks.
The bill will now be considered by the Senate and I look forward to the outcome. Bill C-13 complements other transportation reform initiatives that the government has introduced. The Canadian transportation system must be dynamic and as unrestricted as possible if it is to meet the demands of our changing economy. This legislation, once passed, will achieve this. I am proud to have had a part in its progress at the third reading stage.
[Translation]
Mr. Paul Mercier (Blainville-Deux-Montagnes, BQ): Mr. Speaker, I believe everyone agrees that the principle of Bill C-14 is a good one: rationalizing, unifying and modernizing the existing legislation on public transportation, most particularly rail transportation.
No one can be against these goals of unification, modernization and rationalization since no one, even the official opposition, can be against virtue. We are, therefore, in favour of the principle. We also consider some of the clauses to be good ones, but others are so bad as to be unacceptable.
The amendments we moved to correct those shortcomings have all been defeated. For these reasons we are opposed to Bill C-14 and will vote against it.
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The key reasons why we are opposed to Bill C-14 can be summarized into four points. The first deals with the creation of the short line railways, which represent the secondary elements of the system. Because the system's future depends on them, their creation ought to have been facilitated. The minister has just pointed out that, very recently, such secondary lines have multiplied greatly in the U.S.A., to the public's benefit.
The second reason why we are opposed to this bill is that the procedure for a company to abandon a trunk or other line looks at virtually nothing except profit issues and goals, whereas the public interest ought to hold far more importance.
Third, the bill maintains privileges for the west which accentuate or maintain the differences we are already used to between the west and Quebec.
Fourth, and most important, despite all the talk about decentralizing powers, we see that the government has not been able to resist the ingrained habit, any time new legislation is introduced, of taking advantage of the opportunity to nibble away at provincial powers, as well as to ignore the provinces when their interests are quite obviously concerned by the measures planned.
The first point, then, is the creation of short line railways. I would remind my listeners that these are entities whose development can ensure the survival of the secondary part of the system, which, it must be pointed out, has been scandalously neglected from the maintenance point of view. This has been both scandalous and profitable, perhaps, since the objective was to obtain permission to abandon the lines in question. In order for them to be abandoned, they have not to be used anymore. In order for them not to be used anymore, they need only not be properly maintained, and the result is achieved. Except that now certain sections of this secondary network are in bad shape.
Buyers, generally small companies with little capital, are being asked to take these sections in their existing bad state. Because the legislation governing the railway companies resulted in the network's being in such bad shape, we asked for but failed to get a mechanism from the federal government whereby railway lines would be repaired before being put up for sale, since local companies potentially interested in taking over the lines generally have little capital. Our request was not met. The SLRs that might have been the future of the secondary network are getting no help in setting up.
The other reason we will be voting against this bill is because the abandonment procedure follows market logic only. In the past, when a company wanted to abandon a section of rail line, the National Transportation Agency had to call public hearings. I recall having testified before agency commissioners in defence of a section. Public hearings are no longer held. If a railway company finds that a section of line is not profitable enough, it declares its intention to abandon it. It is true, and this is a good point, that the bill requires a company now give longer notice in announcing its intention to discontinue service and that it be according to a plan previously drawn up and made public.
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But once the information procedure relating to the sale of a section of the network is completed, the rest is pure mercantile logic. If there is no buyer, well, there is no buyer. If there is no buyer, public authorities at the municipal, provincial or federal level are given some time to express their interest in buying it.
Of course, there is hardly enough time for these authorities, and especially municipalities, to organize public hearings. Up until now, we were happy with the current procedure whereby the Canadian Transportation Agency held public hearings before allowing companies to abandon rail lines.
The third reason we oppose this bill is that it perpetuates a system that is biased in favour of the West and that constitutes another example of the imbalance in the treatment of Western Canada, on the one hand, and Quebec, on the other hand. This bill contains a number of clauses we want to see deleted. Clauses 147 to 155 amend but also restore certain privileges for Western Canada.
These clauses set a maximum rate and special conditions applying to the transportation of western grain. These provisions were introduced in the National Transportation Act in 1987, when the Western Grain Transportation Act or WGTA was repealed and the subsidy eliminated.
At that time, western farmers were compensated generously, to the tune of $3 billion, for the elimination of the subsidy and the abrogation of the WGTA. In its bill, the government reintroduces the provisions that were originally in the National Transportation Act, 1987. Yet, western farmers were generously compensated, unlike their counterparts in Quebec. In fact, dairy producers received no compensation whatsoever for the recent elimination of their subsidies. Western farmers should therefore be in a good position to face the new transportation conditions in Western Canada and to adjust to a commercially oriented rail system, since we are told that the main purpose of the bill is to commercialize the network.
Giving unequal treatment to western and eastern shippers, as these eight clauses tend to do, can only lead to inequitable development of the rail system by adversely affecting the resources carriers can invest in the eastern network.
But what is really telling, although it was to be expected, is that the government and the minister are giving themselves discretionary powers in this bill, without even providing for consultations-and I mean mere consultations-with the provinces, in situations where the provinces should obviously be consulted.
There are several examples of that. Take clause 7, which deals with the Canadian Transportation Agency, formerly the National Transportation Agency of Canada which, incidentally, also has a new role. Clause 7 provides that the governor in council shall appoint not more than three members for a term of not more than five years. The expression ``not more than'' means that there could be one, two or three members appointed. The minister may also-he may but he does not have to-appoint three temporary members, for a term of not more than one year, from the roster of individuals established by the governor in council.
This is not a criticism, just a comment in passing. If there are three members for a maximum of five years, and if the minister may appoint other members, it seems to me-unless I do not understand French-that the CTA could be made up of only one individual. This is indeed a possibility, given the wording used.
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The provisions on the CTA's membership include no criteria, benchmarks or obligations for the minister regarding the various interests of carriers, users and the general public. The whole process is discretionary.
Yet, it might have been appropriate to appoint members from a list of names submitted by interested parties. There are not even geographical criteria. Imagine that there are four members. I am just making a point but, strictly speaking, all four could come from the same region. There are no criteria and we want to at least correct that situation by saying that members, whether temporary or not, should be appointed on the advice of the four regions. Ten provinces was too much. We had defined four regions: the Atlantic provinces, Quebec, Ontario and the Western provinces. That was rejected out of hand and it is now up to the government to choose the members of the CTA.
One good thing is that the bill provides for situations that it defines as extraordinary, in which the governor in council may take special decisions recommended by the minister to cope with situations that require urgent action or for which there is no particular provision in any other act of Parliament that would offer a solution.
In this case, situations defined as urgent are those that could endanger the interests of the operator, all the interests of users and the public interest, with the exception of strikes.
In such situations, the governor in council can take special measures. But, if an urgent situation arises in a province, how can provincial authorities be left out of it? In addition, how can the matter not at least be referred to the Standing Committee on Transport? None of this is covered. We have the government arbitrarily taking control, setting itself up as the sole arbiter.
Another measure, good in principle, contained in the bill is the provision requiring that the legislation be reviewed after four years. However well thought out a piece of legislation is, the final test is obviously how well it stands up to real events over a period of time, before a decision can be taken to leave it as is or to introduce amendments. It is therefore a very good idea that the bill includes a provision from the outset for a review of this legislation in four years.
All this is fine and well, but who will review the legislation? It will be reviewed by individuals appointed by the minister. Once again, we are not told that these individuals will be chosen with the approval of the provinces or from lists prepared by the interested parties. No, not at all. The bill provides for a review after four years. There is no guarantee that all interest groups will be called upon to give their opinion on the legislation because shortcomings have shown up in practice. They say that the communities will be consulted, but this is obviously very vague.
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We wanted the agency to be consulted, and the provinces, but there is nothing new. The omniscient, and therefore omnipotent government, as infallible as the Pope, will decide.
The bill provides for the construction of new rail lines, which is not something that happens much these days. In particular, we ought not to expect to see HSTs in the near future. Soon we may be the only country, with the possible exception of Zimbabwe, not to have high speed trains. However, the legislation does provide for the construction of new lines. The agency will grant authorization to a company requesting to build a new line, if it meets certain criteria, and if the route appears to serve the interests of the carrier, the users and the regions it crosses.
But-and this is truly incredible-the province concerned is not even asked for its opinion. If there is one field that is really specific to the provinces, it is the development of their territory. Either the province exercises that right directly, or the municipalities do so on its behalf. This is an exclusively provincial area.
In Quebec, the municipalities draw up land use plans for authorization by the province. These then lead to zoning plans. Imagine, a new line is to be constructed in a municipality. It is possible that the zoning plan, the land use plan, did not include the route of that line. Thus, we must trust the federal government's wisdom not to trash the zoning plan and the land use plan by putting the line through. It is absolutely incredible that putting in a new line-part of the development plan of a region-does not require consultation with the province, yet this is a specifically provincial jurisdiction.
And now for the icing on the cake: centralization disguised as decentralization. Clause 89, against which we tabled amendment No. 17. I must read it, because it is such a juicy tidbit.
89. If the construction or operation of a railway is authorized by a Special Act passed by the legislature of a province and the railway is declared by an Act of Parliament to be a work for the general advantage of Canada, this Part applies to the railway to the exclusion of any general railway Act of the province and any provisions of the Special Act that are inconsistent with this Part.This is absolutely typical. It would, however, have been simple, rational, and respectful of the provinces to state in a general and unrestricted way that a railway constructed by a special act of a provincial legislature remained under provincial authority. That would have squelched the federal government's hunger for power, which is totally contrary to what it is saying.
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Sadly, I must conclude that, with Bill C-14, railway transportation is losing some of its noble mission of public service. Essentiality, railways are intended to serve the public. Rail transportation is tending to become a business like any other, serving not so much
the public as the political interests in power. The state has bowed to market pressures.
I must thank the government for again giving Quebecers, in this bill, one more demonstration that there is absolutely no hope within the federal framework of one day seeing the logic of public interest cease to be constantly subordinated to political or profit making imperatives.
With Quebecers at least, Bill C-14 will have that one positive aspect. Thank you for that, Mr. Minister of Transport.
[English]
Mr. Jim Gouk (Kootenay West-Revelstoke, Ref.): Mr. Speaker it is an irony speaking today on Bill C-14. The hearings are finished, the amendments are finished. They were voted on last night.
All we will do today is have a post-mortem on what has taken place, a eulogy for the things that might have been much better in a bill that has a lot of good merit in it.
There are a lot of good points in this bill, but it could have been much better. There are several areas where the government has either included things that should have been taken out or failed to inject things that should be in the bill.
I will deal with both the things that should have been taken out and with the things that should have been in such as protection for utility companies or municipalities with regard to their infrastructure systems, sewers, water, roads and so on.
Before I get into that, I find myself in the strange position of defending the government. There are some good things in the bill. We have heard in debate from the NDP objections to some of the very things that give the bill some merit.
NDP members talked at length about the abandonment procedure and tried very hard to put in a bunch of amendments which would have basically cancelled the changes that took place. They lacked a basic understanding of the entire abandonment procedure, both the old one and the new one.
NDP members claimed during debate that they have been talking in the coffee shops of Canada. I do not doubt they have. It is too bad they did not know what they were talking about when they were doing it.
The Canadians I have talked to both inside and outside Parliament want a continued rail service, period. They would like to have the service we have now continue, but short lines are certainly a viable alternative.
I have to reiterate what I said in debate about how the old procedure worked and what the problems were. If a rail company wanted to abandon any rail line, short line, main line, it does not matter, the procedure for abandonment of a rail line was that it first had to prove financial hardship.
Before it made that application, and rail companies would be loathe to admit this but we all know it is a fact, it made sure that if financial hardship did not already exist it created it.
The way it creates financial hardship if it does not already exist is by demarketing the line, by going to the shippers on the line and providing some alternative method of shipping their goods to market or at least to a railhead.
This happened in my riding in the Slocan Valley where there was one primary shipper, Slocan Forest Products. CP Rail, in its intention to abandon that line, went to Slocan Forest Products and wrote a confidential trucking contract, we presume at very favourable rates, perhaps even below its cost, to ship its goods to the nearest reload centre in Nelson, B.C. where rail lines still exist.
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It also did absolutely minimal maintenance on that line. That is not to say it did anything illegal or that it ran a line that was unsafe, but it ran it at absolute minimum standards. The evidence of that is by the time abandonment was actually approved, we had trees growing in the middle of the rail line. That does not happen on a well maintained line.
As a result the line was abandoned, but no short line operator in its right mind would bid to preserve and operate a line which had no customers left and which would cost a fortune in repairs and upgrades, when normally the rail line would have been maintained.
With the new procedure a rail company does not have to prove financial hardship. It can apply to abandon whatever line it wishes but it has to go through a very set procedure.
First it has to publish on a three year planning list which lines it wishes to abandon. It is not committed to abandoning them, but they would be lines under investigation or under scrutiny by the rail company with the possibility of divesting itself of those lines.
If it wishes to proceed, it has to offer in a prescribed manner those lines for sale with all kinds of published information to the general public so that short line operators or those that wish to become short line operators could consider purchasing them.
After the set period of time, if the company has not succeeded in selling the lines, it then has to offer them, in turn, to the federal, provincial, local, municipal and regional governments at their net salvage value. This gives every possibility of preserving those lines because the lines have not necessarily been demarketed or brought down to the lowest possible maintenance standards.
We believe these measures will enhance the ability of short line operators to take over the operation of rail lines.
I have spoken to several short line operators and they are aggressively looking to increase their operations and take on new lines. This is a very positive move to enhance the viability of short line operations, which may be a viable alternative to rail operations in marginal areas.
The amendments put forward by the NDP, though well meaning, may have harmed rather than helped the situation. I will now deal primarily with Reform motions which would have either added things that are missing from the legislation or taken things out which should have been out in the first place.
Three Reform motions deal with municipal government and utility company protection. We heard from representatives of the Federation of Canadian Municipalities and various utility companies regarding their concern about the infrastructures of their sewers, water, gas and power which pass in most cases under, and in some cases over, rail rights of way.
The problem is that if a line is sold or ultimately abandoned, in most cases there is no registered easement for the companies or for the various municipalities. This is a problem for municipalities which have designed their whole infrastructure systems for the crossings. They would like to have something in the bill which would ensure the protection of the lines for all the people they serve in the various communities in their areas.
I do not think that is a particularly unreasonable request. It is not a cost factor to the rail companies. Those who would argue against this would say the municipalities or the utility companies can expropriate. They can in many cases, but that costs money. In the end those costs fall to the very people who use these services, the taxpayers.
Again I am defending the Liberal government. The Liberal government needs the Canadian taxpayer to have as much money as possible in order to pay all the Liberal bills generated by the government. I truly am looking out for the best interests of the Liberals with these motions.
Unfortunately the Liberals rejected every one of the motions that would have protected the municipalities. They would have protected all the towns and villages that rail lines go through and all the infrastructure systems that go under or over the rail rights of way. The Liberals turned their back on them.
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I hope those people will remember that when the Liberals start trying to get even more tax dollars out of them and there are problems at the municipal level because of these rights of way.
Another Reform motion that is missing from the legislation is some measure of protection for Atlantic Canada. Motion No. 38 was a Reform motion that provided one of those protections. This was an amendment that would have seen a five-year guarantee that the CN Rail line from Montreal to Halifax would continue in operation. This goes back to Bill C-89 which was the CN privatization bill.
People from Halifax, the port authorities and other representatives from Atlantic Canada came before the committee with regard to Bill C-89 and asked for a 10-year continuance of that line. They put forward some very good and sound arguments.
I put that amendment at committee level and it was supported by at least one Liberal member of the committee from Atlantic Canada. In fact the vote was a tie and the Liberal chair of the committee had to break the tie and did so by voting against Atlantic Canada. The same people came before us with regard to Bill C-89 and Bill C-14 or Bill C-101 at that time, saying they still need this. They said they could live with five years and cut their request in half.
Ports commercialization or privatization is coming in. All the ports will have to look out for themselves, raise their own capital on the marketplace and be responsible for it. The federal government is not going to guarantee the loans. I do not have a problem with that. These ports should stand on their own. They should operate on a commercially viable basis. The ports that came before us on this issue said they were prepared to do that.
However, they cannot go to investors and ask them to put money in if they cannot ensure those investors that while they are developing their post-Panamax facilities to get ready for the coming generation of new and larger freighters, they do not have some guarantee that they are going to be able to transport those goods from Atlantic Canada into central Canada and the American midwest.
As it happens Halifax is the ultimate best port for not only reaching central Canada but for reaching the American midwest. This does not take away from any of the inland ports, for example, Montreal or the Lakehead, because if these post-Panamax ships do not come to Halifax they are going to the New England states or to New York. It is Halifax or it is somewhere outside of Canada. The ports need the CN Rail line with its connection through the Sarnia tunnel to get to the American midwest market.
If I were going to invest in the infrastructure of the Halifax area I would want some assurance that the rail line was going to stay intact until such time as these post-Panamax facilities were developed, the market was there and the goods were being shipped. At that time the port will be prepared to stand on its own.
Liberal members were asking why Reform was interfering with the free enterprise of CN Rail by saying it had to do something for a
five-year period of time. The Reform Party is supposed to be the free enterprise party so why is it trying to bring in such an amendment?
I pointed out that for 80 years successive Liberal and Conservative governments had interfered with the marketplace, specifically with CN Rail, by having this crown corporation doing things that were far removed from normal commercial practices. All I was asking for was a five-year transition period while it went from this crown entity to the private sector.
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The head of CN Rail, Mr. Paul Tellier, appeared at the hearings on Bill C-14. I asked Mr. Tellier that as he was required under the act to provide a three-year plan was he looking beyond that to four, five or six years? He said that he was. I then asked if he had any plans over the next five years to discontinue the line between Montreal and Halifax. His response was, no, absolutely not because CN had made a lot of investments in Atlantic Canada in facilities and there were no plans to do that.
The Liberals could have accepted the amendment that I brought forward so that Halifax could go to the investors and say: ``There is your guarantee that the rail line will remain''. It would not have cost CN or the government or the taxpayers anything. In fact, the only thing that could cost the taxpayers money is if Halifax has trouble raising capital in order to do its post-Panamax facility upgrades and loses the traffic to the United States. This was a win, win situation but the Liberals said no to Atlantic Canada.
Last night we had a standing vote on Motion No. 38 and one by one, each and every Liberal in this place rose and voted against Atlantic Canada. Why did they do that? Could it be that they simply do not want Atlantic Canada to develop any form of financial independence? There can be no other explanation.
Clause 27(3) would not have been required at all. The Reform Party tried to amend it but that would not have been needed if the Liberals had done the right thing with clause 27(2) but they did not. This does not fix clause 27(2). I have to make that clear. Our motion tried to make it slightly more acceptable.
The main source of the items we listed in our amendment to try to better define what is significant commercial harm was provided by the NTA representative stating items that would clarify clause 27(2) so we put those in.
I am going to mix a couple of things together here because clause 27(2) is strongly entwined with this. The minister said this morning that clause 27(2) got unanimous support at committee. Unlike Bill C-89 which went to committee after first reading, we supported it. The Liberals said this would make it more amendment friendly. They were not telling an accurate story, shall we say. When it got there we did propose amendments after listening to the various people who came before us. The Liberals rejected each and every amendment out of hand with very little discussion. After the fact, we discovered that they would have been much better off had they brought in at least the majority of those amendments. The government knows that now. Maybe it knew it then, but for whatever reason it chose not to listen.
The Liberals had a change of heart on Bill C-14. They seemed to be much more open to amendments and they did support a tremendous number of Reform amendments which were brought forward. They went so far as to ask me what I would like to see in the bill. That is very hopeful for the future if they are prepared to do this.
The Liberals did accept a lot of our amendments. Unfortunately, a couple which they did not dealt with clause 27(2) and 27(3). One thing that I tried to do was recognize that if the government does not want to take clause 27(2) out it is going to be passed because after all it has a majority and can pass anything it wishes.
At committee level I tried, first, to make the clause a little more palatable with an amendment which would define much more specifically exactly what was then referred to as significant prejudice. In part, the agreement I made verbally was that if the government accepted this, I would support clause 27(2) at the committee level, knowing full well that we still had report stage to deal with this after I had another opportunity to speak to the various shippers who were concerned about this.
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What the government did was a little sneaky. Perhaps I should have said that it had broken its agreement and therefore I no longer had an obligation but I stuck with it.
I put forward an amendment that would define the meaning of clause 27(2). The government pre-empted it with one of its own, which was much softer than mine. Once the government's amendment was in, there cannot have two amendments proposed on the same clause at committee stage, so it took precedent over mine and mine was not considered. That was the same amendment that I brought forward at report stage.
The government should have supported my amendment as it was proposed, as I did what I had agreed to and that was support clause 27(2) at the committee stage provided the government amended it.
Reform supported two amendments which removed objectionable clauses from this bill. I would like to discuss the one that deals with clause 11(2), commercially fair and reasonable. At the committee hearings I asked the NTA representative to define commercially fair and reasonable. The following is a quote from the testimony before the Standing Committee on Transport, November 7, 1995 by Mr. Ashley of the National Transportation Agency responding to my inquiry.
Mr. Ashley stated: ``What is commercially fair and reasonable is I suspect consistent with what is competitive. What is competitive in any circumstances depends on product market, geographic market, the elasticities of demand for that product, temporal aspects, production efficiencies, market structure, market conduct and market performance''.
``I can tell you that on the street it would mean covering the fixed cost long term average variable cost, contribution to fixed cost and perhaps a return on shareholder equity. But to say today that in the future it will be what the agency does in every case would be wrong''.
``The competition people have appeared before you. The law is predicated on competition in the marketplace. If you look at case law under the Competition Act, the courts would have stated that even a non-compensatory rate, a below cost losing rate, can be a commercially fair and reasonable competitive rate. Perishable goods, production oversupply, the jurisprudence under the Competition Act shows that a commercially fair and reasonable rate can be many things in many circumstances and what is commercially fair and reasonable today may not be tomorrow''.
Responding to Mr. Ashley I said: ``Let me point out what you have just said. When I asked you about the meaning of significant prejudice you said `it could be argued'. When I asked you about the meaning of commercially fair and reasonable you said `I suspect it means'. That is little comfort to the shippers. If this is what the NTA does, if this is how they decide, it is no wonder the shippers are worried. `I suspect', `it could be argued', that is no comfort at all, Mr. Ashley''.
Continuing, I asked: ``Can I then surmise from what you are saying that you don't necessarily agree with these provisions but you are going to work with them to the best of your ability. These things are highly subjective and the NTA, soon to be the CTA, will have to deal with them as best they can''.
Mr. Ashley's response was: ``That is correct, sir''.
I responded again: ``You can see where my concern is. The lack of objectivity in this is telling me that they're'', and this is referring to the shippers, ``probably are right to be worried''.
That is the reason we are concerned about that particular clause and why we supported trying to take it out. Let there be no misunderstanding of what the government is saying. That is from the NTA.
Clause 27(2) is undoubtedly the most controversial part of the entire bill. It should have been taken out. This is what is referred to as significant prejudice throughout the hearings and later changed to substantial commercial harm.
I think there was a possible ploy on the part of the new Minister of Transport. Several shippers' groups visited with the minister and the new chair of the Standing Committee on Transport last week and brought forward their concerns about clause 27(2) and what this would do for them. The minister responded: ``I was not aware of those aspects. That is really interesting. In light of this I will have to reconsider the government's position on clause 27(2)''. This was echoed by the chair of the transport committee.
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I asked how I could co-operate with them to ensure the matter was properly addressed. I told them I did not want to make a political football out of the matter, that I did not want to score political points, I simply wanted the bill to be good.
I offered to make an agreement to send the bill, or at least clause 27, back to committee where all committee members could reconsider and make changes so that it would not be a government response to a Reform amendment. They overwhelmingly rejected my offer. Up until the eve before debate they were very open, saying they were considering these things. The morning of debate it was gone from the table.
Since then shippers have told me they think they were set up. They think the minister gave them that hope to keep them quiet so they would not give a press release against what the government was doing. Once debate began, when it was too late to do any of these things, the government cut them off at the knees. I did not suggest this to the shippers, it came from them. I believe they were right.
There were many witnesses at the committee level. We had long hearings which lasted well into the evenings on several occasions. Most of the witnesses strenuously objected to clause 27(2). If we will not listen to the people who come before these committees, the overwhelming majority of them, why do we go through the cost of interpreters, technicians, research people, the clerks, the offices and all the other costs? Why do we have the expense of all these people coming to Ottawa to testify before the committee if we will not listen to them? Attempts to fix clause 27(2) were not accepted by these shippers.
Bill C-101, as it was first known, was basically lost from the Order Paper with the prorogation of the House. The government obviously wanted to bring it back, which it ultimately did. It tried first to bring it back in the old accepted way, by unanimous consent.
Moya Greene, who was an assistant deputy minister in the transport department, called me in British Columbia to ask if I would agree to unanimous consent to bring this bill forward. I said I would provided they take clause 27(2) out of it. She asked why I
wanted clause 27(2) taken out. I said it was because there was such overwhelming to it. She replied that they had fixed it. I said that I would give her the greatest deal ever: ``Of all the people who objected strenuously on record to clause 27(2), if you can find me two or three who are prepared to say they objected to it but now accept it, I will reconsider my position''. She did not know if she could do that. I suggest, as I did to her, that it has not been fixed.
As I have said, the minister led many concerned shippers to believe he would reconsider clause 27(2). I did everything I could to accommodate this. I brought forward a request to seek the unanimous consent of the House to do that so that it could be done in a non-partisan manner with all of the House agreeing to it. The government rejected my offer.
Who is really against clause 27(2)? The farmers and their organizations are against it, the grain companies are against it, the mining operations, sawmills, pulp and paper producers, chemical companies, manufacturers. Who really benefits? The two rail companies obviously benefit a little, but I do not believe they are the real beneficiaries.
I refer again to testimony of the NTA on November 7, 1995. In this text the term ``significant prejudice'' is used. This term was later amended to ``substantial commercial harm''. All shippers I have consulted with agree this change of words has not substantially changed the intent of this clause, if at all.
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I asked the witness, Mr. Ashley from the National Transportation Agency, what ``significant prejudice'' meant. I asked him to define, from the NTA's point of view, what would happen to me if I were a shipper coming before it and it had do something for me or throw me out the door, depending on how it interpreted ``significant prejudice''.
Mr. Ashley's response was: ``I will tell you what I expect the agency will hear by way of arguments as to what it will mean. On one end of the spectrum it could be argued, and I assure you it will be argued, that it is the mere inability of a shipper to get his goods to market because of the railway's refusal to grant a CLR that is, by definition, significant prejudice of the ability of the shipper to get his goods to market.
``On the opposite end of the spectrum, it will be evidence in argument tendered to the effect that in a shipper's inability to get his goods to market the test of significant prejudice will only be met if that shipper has to close his plant''.
My response to Mr. Ashley was: ``You can see where the problem is. You have just given me an incredible range, including the possibility that a shipper has to go bankrupt before this thing may be decided in his favour. We have to sort of say to shippers `do not worry about clause 27(2), it is great. It will not harm a damn thing as long as you are prepared to go bankrupt'. I find that absolutely astounding''.
I continued to ask Mr. Ashley the following: ``If we do not have clause 27(2) does it stop you from doing your job? In the last eight years have you had a problem doing your job?'' Mr. Ashley's response was: ``The answer to that, sir, is no''.
Who really benefits from this, as near as I can see, are lawyers. This is according to the testimony of Mr. Ashley, himself a lawyer. Why would the government be interested in doing something that will benefit primarily lawyers?
I have an astounding list in my hand. It points out that the Prime Minister is a lawyer, the government House leader is a lawyer, the minister of agriculture is a lawyer, the Minister of Health is a lawyer and the Minister of Indian Affairs and Northern Development is a lawyer. There is a lawyer's growth industry right there. When the member became the Minister of Indian Affairs and Northern Affairs some aboriginal people he had been working with as a lawyer said: ``I thought I had died and gone to heaven''.
The Minister of Industry is a lawyer, the Minister of Natural Resources is a lawyer, the Minister of Justice is a lawyer and the President of the Treasury Board is a lawyer. The Minister of Human Resources Development is a lawyer. He is the former Minister of Transport who introduced and helped draft this legislation. Now we know who is benefiting from this.
Clause 27(2) is a deal killer for the Reform Party. Even though there are other objectionable inclusions or exclusions in the bill, there would be enough value in it to recommend its passage if it not for clause 27(2).
The government had the opportunity to improve the bill but did not take it. We all know it has the power to pass absolutely anything it wants whether it is in the public interest or not. Let us chalk up another win for an autocratic Liberal government and another loss for democracy.
Mr. Bernie Collins (Souris-Moose Mountain, Lib.): Mr. Speaker, I am pleased to speak on Bill C-14, previously known as Bill C-101, as it has some direct impact on the western provinces and certainly my province of Saskatchewan.
I believe the proposed legislation is very constructive, creative and in a manner allows for unnecessary regulations and overlap to be removed. It places greater reliance on parties to negotiate their own solutions on commercial and economic issues and reduce, wherever possible, reliance on regulatory decision making in such matters.
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In my view, this wisely places the matters of competition and monopoly in the realm of other appropriate legislation such as the Competition Act.
A number of places were uncovered where general business laws such as the Canada Business Corporations Act would be used instead of having specialized laws for transportation and companies. We wanted to reduce overlap and regulation. These matters were covered adequately by some other body.
This also makes it simpler for stakeholders who might otherwise be faced with confusion or who are burdened with many different pieces of legislation or regulation. Overall the new act will reduce the costly burden of excess regulation and will ensure the long term viability of Canada's transportation system.
First and foremost in my mind is the concern of my constituents about the rail sector. In this area alone, the legislation will reduce government intervention for approvals and decisions on railway actions, limiting them from 200 to approximately 40.
Although the bill is not completely satisfactory to either the railways or the shippers, it serves after months of public and open consultation to strike a compromise.
The amendments brought to the bill were after considerable work by the Standing Committee on Transport. Considerable consultation was undertaken with all the stakeholders. Because of the consultation, equilibrium and balance has been achieved. The bill has effectively addressed the need for balance between the marketplace and government policy issues and what must remain a matter for the regulator to be involved in.
I turn to some matters that drew considerable attention and fire during the debate from western stakeholders. I do this to demonstrate to the House that concerns have been listened to and changes have been made and to reassure western constituents they have not been hung out to dry in the process.
I wish to focus on three clauses that got the most attention while I travelled throughout the riding and when witnesses appeared before the standing committee. They were clause 27(2), formerly known as significant prejudice; clause 34(1), frivolous and vexatious arguments or applications; and clause 113, now known as clause 112, which obligated the agency to ensure any rates or service levels it sets are commercially fair and reasonable.
Let me deal first with clause 27(2). The clause was reworded, although some have missed it, to clear up what had been a problem. It provides guidance to the agency in ultimately rendering decisions. It does not act is a pretest as some had thought. The words ``significant prejudice'' were replaced by the words ``substantial commercial harm'', terms that are more understood in law. The new clauses 3 and 5 clearly signify and make clear that this does not apply to final offer arbitration.
In standing committee transcripts Cargill, a major shipper, was asked if these changes would satisfy it. Cargill responded positively. These amendments were adopted unanimously by all the parties in the standing committee.
Regarding the phrase ``frivolous and vexatious arguments'' many people in shipping organizations raised concerns. That clause has been removed from the bill.
The third major concern is clause 112. ``Commercially fair and reasonable'' is a phrase that has been heavily investigated and debated throughout the process. There are some concerns raised by the pools. I recall there was a question of commercially fair and reasonable to whom and in whose perspective? The government motion at report stage now adds some clarifying words to this provision. The words ``to all parties'' answer the questions of the shippers. This underscores the obligation that the agency's set rates must meet the test of fairness and provide the users with rail service.
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I do not want to leave the House with the impression that I have conveniently grabbed all of these clauses and I quote them simply to support the position of the government. I have consulted widely with stakeholders and with my constituents on the issue. I feel confident that now is the time to move forward with the bill.
Let me quickly say a few words about the provisions of the bill as they relate to the grain interests in the country. Many witnesses who came forward to the standing committee were pleased that the government seemed to recognize that competition and market forces were not perfect in the grain sector and that a period of transition was needed. The changes that were made, especially in section 27, go a long way to remove the remaining fears of shippers, including grain shippers, about the issue. As well as the protection afforded all shippers under the new legislation, grain shippers will enjoy extra provisions such as maximum rates and a comprehensive hopper car allocation.
The Minister of Transport has indicated that the government intends to sell the 13,000 hopper cars which are presently owned by the department. He indicated that the department is inviting proposals to assess and determine the financial arrangements and the terms and conditions of sale. The interests of all stakeholders, including producers, will be taken into account in this process.
In closing, I will touch on the positive attributes of the legislation. While I was a member of the committee listening to the hearings and particularly presentations from the west, section
27(2), section 34(1) and also section 113 which is now known as section 112 were also major concerns. What happened with those?
We altered the wording in section 27(2) to meet the needs of shippers. Also section 34(1) which said ``frivolous and vexatious arguments'' was dropped completely, and I think correctly so. In section 113, which is now section 112, we have amended the wording to deal with those people who will be affected by it.
The shippers and rail companies and all who will be involved with new Bill C-14 have to come to the position of making it work. If they want it to work, it will. If they do not want it to work, they will use every effort in their power so that it will not work.
In my opinion, we have set legislation which is a compromise and in the final analysis will meet the needs of shippers, railways and all Canadians.
[Translation]
Mr. Jean-Guy Chrétien (Frontenac, BQ): Mr. Speaker, I will use my 20 minutes to speak to Bill C-14.
I am keen to speak on this bill, which is intended to update legislation on railway transportation, to redefine the mandate of the National Transportation Agency and to further deregulate air transportation.
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Obviously, I will not be debating the entire bill, but rather setting out for you certain points that are of particular interest to me. We in the Bloc are opposed to Bill C-14 for a number of reasons. The provinces are not consulted on a number of points in the bill, including one of special interest to me-the environment.
As my colleague for Blainville-Deux-Montagnes, the former mayor of the beautiful municipality of Blainville, said yesterday in this House, clause 98 of Bill C-14 is incomplete, because it does not oblige the Agency to do an environmental impact study before authorizing the construction of a rail line, and this is totally unacceptable. I would remind you here of the unfortunate case of the Irving Whale.
In 1970, the Irving Whale sank off the Magdalen Islands and Prince Edward Island. It was, of course, the Liberals who were running the country at the time. Are we going to entrust the environment, as in the construction of a huge rail line or a major section, to a government that showed no environmental concern in the infamous case of the Irving Whale?
In 1994, we had a sort of committee, known as the Easter-Gagnon committee, that went around the Gaspé, Quebec and the Maritimes. Two backbenchers spent several thousand dollars of taxpayers' money for a political promotion. This was followed by the Department of the Environment's official consultation when the decision was made to raise the barge. The result was an outpouring of over $20 million, and the Irving Whale remains on the bottom.
You will ask me what all this has to do with the National Transportation Agency. The point is simply to show the danger of giving the federal government total jurisdiction over the environment. In fact, the environment is not covered by the Constitution and, until proof is provided to the contrary, it comes under provincial jurisdiction. Clearly, the construction of a railroad changes the rural and urban landscape.
The environmental impact must therefore be seriously considered and, moreover, the provinces should be consulted, since land use is their responsibility.
There is nothing surprising in this. It is one of many examples of the Liberal government's effrontery in pushing the provinces out of their own fields of jurisdiction.
I would be remiss as well if I did not talk about unfairness, since recently I have had a number of opportunities to raise this issue and today will be no exception. Like my colleague for Blainville-Deux-Montagnes, responsible for transportation issues at the federal level, pointed out earlier, eastern Canada faces a very serious problem-the abandonment of several shortline railroads. These sections were left discarded by the federal government and are now in bad shape, for the most part.
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As you can easily imagine, once these lines are taken over as short line railways, operating them will not be so profitable, especially since the financial situation of short line railways is rather precarious because of the level of debt and because of the condition of the railways and bridges.
Eighteen months ago in my riding, in the great region of the Eastern Townships and Chaudičre-Appalaches, the Quebec Central Railway abandoned the Chaudičre-Vallée line, which goes from the city of Sherbrooke to Lévis and Lac-Frontičre through Saint-Georges-de-Beauce, a distance of 382 kilometres.
The Quebec Central Railway gave such poor service and charged such high prices in its last 20 years of operation that it lost almost all its customers. Of course, it went before the National Transportation Agency, which gave it permission to abandon the line simply because it was not profitable.
At this point, I would like to remind you that, in the west, it is not necessary to demonstrate that a line is not profitable. Rather, it must be demonstrated that the line is not in the public interest. Since that is much harder to prove given the very large number of grain producers, it is much easier to abandon lines in the east than in the west. Once again, we are up against a double standard.
In the long term, this situation will lead to the failure of several projects and the abandonment of several rail lines. That is why a railway rehabilitation program would correct this situation, espe-
cially in the west and, of course, in the east. In the west, however, they speak a very different language. I often talk about the advantages given to western Canada, including the compensation offered western farmers after the WGTA was repealed and their subsidies eliminated.
While western farmers received nearly $3 billion in compensation, their eastern counterparts were forgotten. This is a perfect example of inequity and injustice. Once again, shippers must face the new transportation conditions in the west and adjust to a commercially oriented railway system. Giving unequal treatment to eastern and western shippers is dangerous, as an inequitably developed rail network will adversely affect the resources carriers can invest in the eastern network.
I have here two short sentences that add to the inequities between eastern and western Canada, including the abrogation of the WGTA announced last year. Maximum rates can be frozen until 1999. In concrete terms, for western grain producers, the ceiling set in 1995 will apply. Railway companies cannot increase it; it is frozen at the level it was at when the WGTA was repealed.
In addition, for over 15 years, these same producers have been allowed to use the government's fleet of hopper cars for free and, if they bought the 10 hopper cars for the transportation of grain, I am sure they would pay a reduced price.
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Should we wish the same for Quebec? I doubt it. Quebec is a much larger territory than its neighbour, Ontario. Yet, the length of railway lines in Ontario is twice that of Quebec. Lines twice as long in a province almost half the size means there is actually four times more railways in Ontario. So, the inequity does not go back to this government coming to office: it existed long before 1867 and even before 1841.
Let us now look at construction and maintenance costs. Clause 103(3) provides that the owner of the land shall pay the costs of constructing and maintaining the crossing. Here is what this really means. I own a piece of land and there are 832 feet of railroad over it, cutting it in two. Since I have to cross from the west side to the east side of the railroad, the costs of maintaining the crossing are paid by the owner of the railroad. Now, under this bill, such costs would have to be paid by the owner of the land.
This makes no sense. Property rights pertaining to my farm existed long before the railroad was built. They go way back. Consequently, that clause alone is sufficient reason for me to condemn and to oppose that bill. Farmers who are listening to this debate on Bill C-14 must realize that if they use a private road to go from one side of their farm to the other, they will now have to maintain the crossing. The federal government just gave you a new responsibility, even though this area comes under provincial jurisdiction.
As I said earlier, the owner did not ask the railway company to encroach on his land. Consequently, the costs of constructing and maintaining the crossing must be paid by the company. After all, it uses the land. The same goes for fences. Not more than two weeks ago, it was reported in the newspapers that in Saint-Étienne, close to Quebec City, coyotes or stray dogs chased a herd of cattle over a railway fence and the CN convoy killed 49 animals.
Under this bill, fences would become the sole responsibility of the farmer. If you are a farmer and if a railroad runs over your land, you alone will have to pay for the whole fence, on both sides of the railroad, to keep your cattle from going on it. To those who might think this is fair, let me just say that Quebec's municipal code provides that the construction, maintenance and overall responsibility for fences are equally shared by the two owners. Any good notary knows that.
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In its wisdom, the federal government is deciding that from now on you will have to put up your own fences. This will not do. It makes no sense.
Another point. When I was mayor of my municipality, I told you that each farmer had 832 feet, unless they had more than one piece of land. Over the years, a problem began to develop with drainage. As mayor, I met with the authorities of Quebec Central Railway, and it was mutually agreed that they would install two large culverts under the track. There was no problem. Do you know that, with Bill C-14, this would become the responsibility of the farmer? That does not make any sense either.
I would like to conclude with a look at the issue of running rights. In its present form, the bill allows a short line to transport merchandise to the nearest rail head, regardless of the national carrier chosen by the shipper. By giving provincially licensed railway lines running rights on federally licensed lines, a short line could deliver its freight to the rail head of any federally licensed company.
By transporting its freight over a greater distance, a short line would generate higher revenues, as well as offering improved service to its customers and cutting down on freight transfers. This is a logical and efficient improvement with respect to the running lines situation. And if the government is serious in saying that it wants to encourage the development of short lines, it must approve this proposal, which comes from our party, and in particular from the hon. member for Blainville-Deux-Montagnes.
In conclusion, I would like to pay tribute to a businessman in my riding of Frontenac, Jean-Marc Gigučre, president of Marco Express. For several years now, Mr. Gigučre has been negotiating with the head office of Canadian Pacific to buy 382 kilometres of track linking Sherbrooke, Vallée-Jonction, Lévis and le lac Frontičre, via Saint-Georges de Beauce.
Like many of his fellow citizens from Beauce, Mr. Gigučre is a courageous and persistent fellow, and he has not given up yet. Every week he heads for Toronto to pursue the negotiations. It is a slow and difficult process. In the meantime, the track continues to deteriorate. Almost one mile of rails and ties was stolen right outside Bishopton. By a fluke, the thief was caught. He went to court and was ordered to reimburse just the value of the old iron, $5,200. How much is it going to cost the promoters to rebuild one mile of track?
That aside, I pay tribute to Jean-Marc Gigučre and wish him every success in his efforts to buy and operate this new short line in the Eastern Townships.
Mr. Ronald J. Duhamel (St. Boniface, Lib.): Mr. Speaker, I would like to make some comments and to ask two questions in particular. My colleague spoke of inequity. It seemed to me that this bill involving many key players is trying to strike some balance. Maybe my colleague would like to comment on this.
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I would like to add that the byelection results last night, not only in Ontario and in Newfoundland but also in Quebec, show that Canadians think that the government of Jean Chrétien is quite equitable, fair and responsive.
I believe my colleague was not too ``chrétien'' on two aspects. For example, he said that this bill did not require an environmental study of its impacts and so on. As far as I know, he is mistaken. Such a study is mandatory under the Canadian Environmental Assessment Act. An environmental study is required before any approval, and this is the case here.
The second thing I want to say is this. If I understand correctly, it is not true, for example, that the damage caused to a land when a railway company proceeds with some construction project is the responsibility of the owner of the land. It is the responsibility of the railway company, not of the owner of the land.
I would like to know whether the member would comment on that. Did I misunderstand what he said? Maybe he thought he should exaggerate things. I would like him to clarify what he said.
Mr. Chrétien (Frontenac): Madam Speaker, I find the comments by my distinguished colleague from St. Boniface very pertinent. But before talking about environmental assessment and the construction of entrances, fences, and drainage culverts in farmland, I would like to get back to yesterday's election results, since he raised the question.
Last night on CBC, my dear colleague from St. Boniface also probably watched a special two-hour program on the state of the nation. Did he look at the poll results on voters' intentions at the federal level? His party would get 50 per cent of the votes across Canada, but only 35 per cent in Quebec, less than what it got in 1993. The Bloc Quebecois would get 53 per cent, or 4 points more than in 1993. What is going on? I do not want to be called a racist, but he knows where his party's strength is in Quebec. In francophone ridings, it gets walloped.
Look at what happened in the riding of Lac-Saint-Jean with a 22-year old candidate. Whether you like it or not, Madam Speaker, he is going to be the youngest member in this House. He got 76 per cent of the votes. It is a lot more than your leader in the riding of Saint-Maurice where he got a mere 54 per cent, in spite of his joining forces with the Conservatives.
Just yesterday, a liberal member who worked tirelessly in the riding of Lac-Saint-Jean told me: ``Of course, we do not expect to win, but it will be a good indication. Watch the results in Lac-Saint-Jean, the Liberal Party is going to shoot up''. It did not shoot up, it slipped on a banana peel.
In Quebec, the Bloc Quebecois is working hard, with dignity and modesty. This is the reason why-
Mr. Duhamel: I rise on a point of order, Madam Speaker.
Mr. Chrétien (Frontenac): He is wrong, Madam Speaker, do not listen to him.
Madam Speaker, my colleague asked me a question on the election results, I am answering him.
Mr. Duhamel: I rise on a point of order, Madam Speaker.
I also asked two specific questions of my colleague who suggested that there was no need for an environmental assessment. He is wrong. But, of course, he does not want to talk about that, he wants-
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The Acting Speaker (Mrs. Ringuette-Maltais): That is not a point of order. The member for Frontenac has the floor.
Mr. Chrétien (Frontenac): Madam Speaker, you understood that I was about to get to that. But beforehand I wanted to tell my colleague from St. Boniface that we, from the Bloc Quebecois, are representing our province, our country, Quebec, in the best and most faithful way. That is why the opinion polls are so encouraging. I hope our standing will not drop.
I invite the Reform Party to do a good job in showing opposition in this House. They could, as well, kick the Liberal Party out of the other provinces. In Quebec, we are taking care of it. We will take care of the Liberal Party in Quebec. Fairness, that is what Quebecers want. They are frustrated by unfair treatments and have a hard time forgetting them.
My hon. colleague seems to have misinterpreted Bill C-14. Maybe it is not the same in English and in French. Personally, I read the French version, and it clearly says that railway companies have no obligation to maintain crossings, make fences or install drainage culverts under the railway once is constructed.
I remind the member for St. Boniface that, as mayor of my village, Garthby, I had to negotiate with Quebec Central Railway. I reread Bill C-111, which became C-101, which became C-14, and that is how I discovered this shortcoming.
My colleague, the member for St. Boniface, should read carefully the legislation, perhaps in both languages, because the translation often leaves little shortcomings that can change the interpretation.
I conclude rapidly on the issue of environmental assessment. For your party, the past is no guarantee for the future. Take the Irving Whale for example. Early next September it will have been sitting on the ocean floor for 26 years, rusting away and leaking contaminated oil. We spent over $20 million last year, the government organizing three so-called environmental public consultation sessions to end up with nothing, absolutely nothing. We will start all over again this year.
[English]
Mr. Ron MacDonald (Parliamentary Secretary to Minister for International Trade, Lib.): Madam Speaker, this is a very important piece of legislation, one that has had its roots way back in the first session of this Parliament and perhaps even further back than that.
For years the country has debated the future role of its transportation sector generally and quite clearly since the mid-1980s, 1986 or 1987, the future of rail. As everyone knows, it was on the promise of access to markets by way of rail that was one of the most compelling reasons the colonies, upper and lower Canada and the maritime provinces, came together and formed Confederation.
The debate may go on for a long time as to whether that ribbon of steal was actually a cause for the expansion of the economy like we wished to see in the Atlantic provinces, but I will not argue that today. I am sure my comments have been heard in that regard in other debates in the past.
Suffice it to say one of the things that has happened in the last number of years is that we are no longer dealing with a domestic market in the transportation sector which we can protect. Protectionism has gone the way of the dodo bird. In the last dozen years we have seen an explosion of competitiveness.
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Canadian businesses have had to become more competitive. It does not matter which sector we are dealing with. We have had the free trade agreement, we have had the NAFTA, we have had the GATT. There have been agreements under TRIP on intellectual property. Every country that seeks to expand its economy has had to look outward.
The transportation sector is really no different. In the past we have hung our hat on public interest and public policy in order to protect these industries. There were so many regulations dealing with rail and air transportation that they would literally choke a stable of horses, not just one horse.
Clearly one of the things this government and the previous government, to give it a little credit, saw was there had to be a reduction in the regulatory burden in the transportation sector.
In 1987 when the government came out with the new National Transportation Act there was great debate about whether when we deal with rail line abandonment or rail line sale the argument would still be made that a line should be kept because it was in the public interest. I have debated that with myself and with others over the last number of years, in particular since I was elected to the House of Commons in 1988. One of the concerns I have had is that we still are able to maintain a national rail line from coast to coast.
One of the problems we have had, however, in the rail line is that both lines, Canadian National, a crown corporation recently privatized, and Canadian Pacific, were not as competitive as they had to be. One of the reasons they were not as competitive as they should have been is they had some protected markets.
They had an onerous regulatory burden that in my view led to some industries' in Atlantic Canada being less competitive on the international market, in particular the U.S. market, than they had to be to maintain their market share, to do value add in their industrial sector and continue to employ Canadians.
What has happened in the rail sector? Over the years we have seen both of our national rail lines, Canadian Pacific and Canadian National as a crown corporation, losing enormous amounts of money. It seems that when the economy goes into a cyclical downturn, and we can almost project when those things will happen, the bit of money made by these two very large and important companies during the good years is more than lost, many times over, in the bad years.
Over the last number of years both of these companies in the bad times have lost over $4 billion. For Canadian National Railroad, which was a crown corporation, the Government of Canada repeatedly has had to recapitalize that business.
When we came into power we said we had to have a national rail system. I come from a part of the country where a national rail system is essential. It has been there for many years. Unfortunately that national rail system has not allowed my part of the world to be as competitive with its industries as it should be.
Perhaps it is because both those large railroads, Canadian National and Canadian Pacific, when they were covered and wrapped in the warmth of burdensome regulations which protected both of their markets for that sector of the transportation business did not allow my part of the world to be as competitive as it should be.
A few years ago when I was in opposition I was fortunate enough to visit Hamburg. I visited with some interests promoting rail lines, both CP and CN. The thing that absolutely astonished me was when I looked on the wall of the office there was an ad from Canadian National: ``Canadian National, serving Canada from Montreal to Vancouver''. Somebody had forgotten to tell them there was another part of Canada, the closest part of Canada to Europe, Atlantic Canada.
The rail line at that point was still in place from Sydney to Montreal and somebody had forgotten to market the line. CN, it might be argued, in the past had selectively and intentionally demarketed the line from Montreal east.
Then this bill came in. In the past session of Parliament it had a different number. In this session it is Bill C-14. I was fortunate enough to sit on the privatization task force of CN, commercialization as we called it at the time. One of the things we heard over and over again when we spoke to shippers, when we spoke to provincial ministers, provincial governments and municipalities is that if rail is to continue to have relevance two things had to be done.
First, we had to recognize that rail in Canada could no longer be protected from outside forces, in particular the United States. Rail in the United States had undergone a renaissance. It had by and large been privatized. It had gone through shrinking and now is in an expansion mode.
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It had been recapitalized primarily by the private sector and was competing on a daily basis through its connections with U.S. ports, particularly on the east coast but also on the west coast around Seattle and on the south Pacific coast around San Diego for Canadian bound traffic.
If the Canadian transportation sector in rail was to remain competitive, something had to change. CN again last year had a good year, it made some money, but that has not been the recent history of CN. It was clear to me that within a very short period of time, if it was still a crown corporation, CN would have to dip back into taxpayer pockets and would have to be recapitalized.
Quite clearly the government does not have the funds to do that. Members from all sides, particularly from the Reform Party, like to tell us all the time we have to accelerate our withdrawal from certain areas the government has traditionally supported. We have to leave it up to market forces. I believe that has to be the case.
The change in the regulatory burden the bill sets is important. When dealing with some aspects of rail line abandonment or conveyance in the past under the old bill there were over 200 different types of initiatives needing government approval. The new bill drops it to 40 or 50, in that area.
Reducing the regulatory burden means companies that are regulated will be more efficient. More than that, by putting this bill into place and by reducing the regulatory burden, by making it easier for short lines to be established in Canada, we should be able to reduce the overall cost of rail transportation. We should be able to make businesses that rely on rail transportation more competitive.
I come from a part of the world, around Atlantic Canada, Halifax, which has a brilliant future. In Atlantic Canada our future, particularly in Nova Scotia, will be based on our ability to trade. It will be based on our ability to very quickly let go of industries which are no longer competitive, which have had to rely for far too long on government support to maintain the jobs.
We have to find out what we can do best in a place like Halifax. In Halifax the thing we will do best is trade. Before Confederation Atlantic Canada and her ports were among the busiest in the new world. They were busy because we traded. That is why we were there. We had the best port in the world, the port of Halifax. It does not require icebreaking or dredging, but in order to get to its markets it requires a rail line and a road transportation system.
Provincial governments work on their road transportation systems. There have been many announcements in New Brunswick. The premier announced in the last year over $350 million in highway construction.
In Atlantic Canada, in Nova Scotia, we have had to refocus our efforts on what we do best, utilizing our location. In real estate they say the most important thing is location, location, location. At the port of Halifax location is our most important asset. We are the closest ice free port to the huge European market. We have a skilled workforce. We have plenty of industrial land. We have a reasonable taxation regime; it is not an onerous burden.
Nova Scotia is the only province that does not charge provincial tax on diesel fuel used in rail. In Nova Scotia we are trying to refocus.
When the privatization of CN first came to the task force, I admit I had grave concerns. I still have some concerns. CN had to be privatized. CN had to rely on market forces and it has to be as
competitive as it could be to keep the business it has to keep for its new shareholders.
Privatizing CN also meant that CP, its main competitor in Canada, had to become more competitive. Those two rail lines becoming more competitive with each other also means they will be more competitive with other modes of transportation and other rail lines which are capturing Canadian bound traffic through U.S. ports and running over U.S. rail lines.
Deregulation had to take place. We had to take that onerous burden off both those rail lines. This bill seeks to address some of the concerns of an onerous regulatory burden. I have watched what CP has done in Canada. I am not going to criticize it but CP has made a very strategic decision to abandon its eastern Canadian operations. It had a rail line that went into the port of Saint John. That rail link was essential to the port generating the net revenue and the jobs it had done in the past. The port of Saint John is not doing the business it had been doing when CP still had a rail line.
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CP made a decision that it was going to go through a U.S. port of call. It bought the D and H rail line down through the United States. One of the states had given it $5 million, $10 million or $15 million to upgrade it but CP made a strategic business decision to abandon the line in maritime Canada. I have a concern that CN Rail will make the same business decision.
Clearly I would have liked to have seen in this legislation a requirement that under a privatized CN Rail for a specific period of time, be it three years or five years, the newly privatized corporation would not be able to abandon the line. If it did abandon the line, that line would have to come back to the federal government and the responsibility would lie with the federal government. Why did I think that was important during the task force deliberation? It was important for two reasons.
First I know we can compete in Atlantic Canada. The port of Halifax will be able to generate the new revenue, the new traffic required but I know it is going to take a little bit of time. It is not going to happen overnight nor is it going to turn on a dime, it is going to take some time.
My concern then and what still concerns me is that over a period of time, over the first two or three years with a privatized company with CN, decisions will be made which may not be similar to the decisions CP made and would put the very existence of that rail line in doubt.
I do not think we need special treatment in Atlantic Canada. We have to pull ourselves up by our own bootstraps and we can do that. The port of Halifax is experiencing a growth in traffic, not because of government subsidy, but because we have the best darn location to be found on the eastern seaboard of North America for that type of business.
Second we are going to succeed down there because increasingly as we get more trade from Europe and as post-Panamax vessels start plying Atlantic waters as they are currently doing in Pacific waters, there are very few ports on the eastern seaboard of North America that can handle those vessels. Halifax can handle those vessels.
We have reduced our costs of operating the port of Halifax. My government has come in with a marine transportation policy which will have a local port authority established, something I have begged the previous government for. The member for Thunder Bay knows that from the past Parliament. I said to let us do what we can do best, let us compete.
My port has said that on port fees it is prepared to have user pay as long as it is reasonable, transparent and that the government provides its service that it is paying for as cost competitively as possible.
I look with a great deal of optimism on the future of rail in Atlantic Canada but those concerns I have just expressed are ones I will continue to be very vigilant about. If I do see that the recently privatized Canadian National starts talking about making decisions similar to what CP has made which would jeopardize the main rail line from Halifax to Montreal, I give a guarantee to my constituents and I give notice to my government. I will be the first on my feet in this place and any other public forum to make sure that the privatization of CN, along with the very good provisions of Bill C-14 which have reduced the owners regulations, are not used by a newly privatized company, CN.
Mr. Hermanson: You will have zero impact. You will be a big zero.
Mr. MacDonald: The big zero is on the other side and perhaps he can ask the question when I am finished my speech.
Somewhere you have to have a little faith. This issue has been one where it has been difficult for me to put faith in a large privatized corporation.
Over the last number of years, as we all change when we are exposed to new things, I have changed a great deal. When I started in politics in 1988 I really believed that government had a large role to play in my economy in Atlantic Canada than what I do believe today. I know that governments in the past through protectionism, through regulation, through transfers, through regional development programs and policies have tried to do something to create economic growth but by and large they have failed.
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In places like Atlantic Canada far too often we see the wonderful entrepreneurial spirit which built that part of the country over hundreds of years crushed because of inappropriate government
supports and transfers. Clearly, the people in my part of the world, my sons, daughters and family want to be able to work and live in Atlantic Canada. In order to do that public modes of transportation, all modes, be they rail, road or air, must be as competitive as possible. As a government or a Parliament we may think we can protect those industries, but we cannot protect them from the competition from south of the border and competition which is now upon us from all over the world.
I know we can succeed in Atlantic Canada. This bill is a step in the right direction. The reduction of regulation and the privatization of CN both will inevitably lead to a more competitive CP. The recently constructed Sarnia tunnel means we will be able to attract a volume of traffic necessary from the Chicago markets to come in through Halifax instead of Baltimore and New York and thus create jobs in Halifax and along the Canadian line down into the Chicago markets. In order to do that we must increase our volume so that we will have full train loads leaving Halifax and going straight to the yards in Chicago.
We have some way to go, but I am absolutely confident that those who are responsible for public policy and those responsible for the entrepreneurial zeal in Atlantic Canada will seize the opportunity and CN will see the rail line from Halifax to Montreal as an important profit centre, not as a cost centre.
With the advent of things such as short line operations, because the bill allows for easier establishment of short line operations than did past legislation, it will ensure that there is a competitive rail link. A rail link is absolutely essential to the economy of places like the port of Halifax.
Nearly $400 million a year in annual net revenue is generated in a city of 320,000 people by the fact that container traffic and bulk cargo comes into our port. It is not for distribution to local markets but serves central Canadian and northeastern and central U.S. markets.
In the tough times of the recession we did not shrivel up and die. CN was not competitive. Rates were too high because of regulatory burden. We have succeeded in the tough times. In the good times that are to come through expanding trade this type of legislation will assist my part of the country to take its rightful place as an entry and exit point to the North American market. Maybe the bill will go a long way to establishing a dream worth pursuing, the establishment of the port of Halifax as the NAFTA port north.
I support the bill with some reservations. However, I will be vigilant during the years ahead to make sure that this newly privatized company does not abuse the new regulations it has been given, but that they are used to ensure that the line between Halifax and Montreal is as competitive as possible.
Mr. Jim Gouk (Kootenay West-Revelstoke, Ref.): Madam Speaker, I would like to ask one question dealing with the hon. member's concerns he expressed at length about the CN rail line from Montreal to Halifax.
I do not know if the hon. member heard my speech this morning when I talked about my concerns. The people of Halifax came to the committee first on Bill C-89, the CN privatization and later on Bill C-101, the new Canada Transportation Act. They asked, begged and implored the committee and Parliament to offer some guarantee of continuance for a period of time for the reasons the member stated, so that the line would not disappear before the post-Panamax traffic was in place.
They wanted assurance for investors that they could invest in the newly privatized or commercialized Halifax port which does not get government support for these loans. I have no problem with that and they did not either, but they said to at least give them the tools to develop their financial self-sustaining characteristics. This is something which will not take traffic away from interior ports such as Montreal or the lakehead because post-Panamax freighters cannot and will not go up the St. Lawrence. They either go to Halifax or they go to the United States. Those are the two choices.
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I talked to the president of CN Rail. I asked him if it would be a hardship for him if this was put in. His response was that it would not be.
What the hon. member should know is that the Bloc Quebecois has a private member's motion coming up on April 19 or thereabouts, because CN is not living up to its responsibilities to repair and rebuild the bridge which links the north shore to the south shore. If CN does not do that, if it is allowed to let it run down to the point where it is no longer practical to run it, that rail line will be gone.
We proposed in Bill C-89 on behalf of the member's people in Halifax that there be a 10 year continuance. That is what they asked for. The Liberals shot it down.
They asked for it again when Bill C-101 was in committee. They said: ``We have cut our plea to the minimum. We can live with five years. We would like to have 10, but we can live with five. Please give us the five years we need''. I reiterate, it is at no cost to anyone. It is not a cost to the internal ports of Canada. It will not take business away from them. It is not a cost to CN Rail. The president of CN Rail said it would not be a problem. I introduced this as Motion No. 38 which was voted down by the Liberal government.
The hon. member said that he would rise after the fact and speak on behalf of Halifax. It is too late. He either speaks now or
whatever benefit this may have brought Halifax will be gone. No matter what he says, it will be gone. He should know that one backbencher rising in Parliament after the fact will not make a difference. He should have been there when we were trying to put this through for Atlantic Canada.
Is the hon. member categorically stating that the Liberal government made a mistake in not passing Motion No. 38 which would have allowed that five years of continuance at no cost to anyone? Is he prepared to stand in the House today to say that he supports the motion now, even though it has already been defeated, against the position of the Liberal government which has turned its back on Atlantic Canada?
Mr. MacDonald: Madam Speaker, we have been listening to a speech from a Reform member whose party has been basically shut out in Atlantic Canada because of its harsh slash and burn policies toward regional development. It wants to privatize everything that walks, moves and crawls, yet the hon. member suddenly rises and pretends he has the interests of the people of Halifax at heart.
I do not need to take lessons from him or from anyone else in the Reform Party with respect to looking after the interests of Atlantic Canada. In the last Parliament 48 sets of questions were asked of the Tory ministers of transportation with respect to the competitiveness of the port of Halifax. Those questions came from the member of Parliament for Dartmouth. There were probably just as many questions asked by the member of Parliament for Halifax in the last Parliament.
In this Parliament it was the member of Parliament for Dartmouth who visited the Minister of Finance on a number of occasions to seek changes to the Customs Act and the Income Tax Act which would allow a port such as the port of Halifax to become a de facto duty free, value added trade centre.
Mr. Hermanson: You are avoiding the question. You do not have the courage to answer the question.
Mr. MacDonald: If the member wants to talk about courage, I will talk about courage. The courage is that in the past I have stood in my place here, in my place in my riding and in my place in my caucus and I have never been afraid to speak up for the people in my area. I have done something which members opposite have not done. I have been able to impact in a positive way public policy for the benefit of the people who live in Atlantic Canada.
We need no lessons from the Reform Party. The Reform Party, in the last few weeks of the campaign in Labrador, suddenly found out that Labrador existed. The Reform Party gets up every day in the House to talk about cutting social transfers to the poorest provinces. However, when it is on the election campaign in Labrador it talks about paving the Labrador highway at a cost of $1.1 billion. We need no lessons on this side of the House from those members opposite.
As the member of Parliament for Dartmouth, I raised with the task force on a number of occasions my concern that the rail line should be protected. I still had the concern that rail line should be protected.
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Unlike members on the other side who do not think their voices count in this place, I happen to think the voices on this side are listened to by the front benches. I have received commitments not just from the front benches but from people like Mr. Tellier, the president of Canadian National. If we go back to the committee record, when he was asked the question he said that CN had no problem with the continuation of the rail line because CN was not going to abandon the investments it had made in Atlantic Canada, that it saw Atlantic Canada as a future profit centre for the operation.
To answer my hon. colleague's question of whether I give my unequivocal support, no I do not. Am I concerned about a privatized company, whichever it is, coming forward and changing its corporate direction? Yes, I am. However, am I confident that a rail line from Halifax to Montreal will be maintained as a viable entity, either as part of the main line or part of a short line, which I would support although I do not know if the hon. member would? I am confident that will continue because business goes where there is opportunity. There is no greater place in the transportation sector in Canada for new opportunities than there is at the port of Halifax.
Mr. Elwin Hermanson (Kindersley-Lloydminster, Ref.): Madam Speaker, I will ask a brief question of the member for Dartmouth.
He began his speech by talking about a new trading agreement. He talked about NAFTA, GATT and the like. I remember before the 1988 election when the Liberals were fighting the NAFTA agreement, they had advertisements in which they erased the boundary between Canada and United States. Now he has the gall to stand up in the House and support NAFTA, saying how wonderful it is. That is a big flip-flop on the part of the Liberals.
The transportation act we are dealing with, Bill C-14 replaces the old WGTA. The minister of agriculture stated as late as November 1994 that the Crow benefit was going to remain intact, that he had no intention of abolishing it. Three months later, in the 1995 budget, the Crow benefit was gone, another big Liberal flip-flop.
The member is praising the privatization of CN. Reformers have always been on the record as favouring privatization where the private sector can do a better job than the public sector. History is proving that position is right. I would like to remind the hon. member that his party's position was the opposite. It said that privatizing CN was despicable. I believe those were the words Liberals used. Now he is praising the privatization of CN. That is the third flip-flop.
The fourth flip-flop is that he said there should be a guarantee that the CN line remain between Montreal and Halifax. This member is from Dartmouth. He should have the interests of his constituents in mind, yet he is not supporting Motion No. 38 put forward by the member for Kootenay West-Revelstoke, a motion that would have put that in the legislation.
My question is really simple. Why should we believe anything a Liberal says?
Mr. MacDonald: It is unfortunate Reform Party members do not know whether they are punched or bored, which is part of their problem. The Reform Party opposite cannot believe for a second that the actions of the government have led to unprecedented popularity and support for our policies.
In Atlantic Canada, including Nova Scotia, the place Reformers are so concerned about in terms of transportation policy, the people are so certain they have made the right decision, in the latest public opinion polls 74 per cent said that they would continue to support initiatives like this and the privatization of CN because they know these initiatives mean economic growth and jobs in Atlantic Canada.
Mr. Elwin Hermanson (Kindersley-Lloydminster, Ref.): Madam Speaker, thank you for the opportunity to speak to Bill C-14. I hope I remember to call it Bill C-14. This bill had another title in the last session, Bill C-101. It is one of the bills the government brought back at its original stage. I talked about flip-flops earlier. The reinstatement of bills is another Liberal flip-flop. They said it was an abhorrent practice while in opposition yet they have followed that same practice themselves.
It is rather amazing we are already at the third reading debate of Bill C-14 on this Tuesday morning. I left on Thursday and was back in my riding over the weekend to attend to commitments. There were no sign that Bill C-14 would come up for debate. However, the government suddenly decided to slip it on to the Order Paper on Thursday and the House was doing report stage on Friday and Monday. One has to wonder about the motivation of the Liberal government in bringing this bill in around a weekend and trying to move it quickly through the House. I believe there is a little bit of mischief involved in the scheduling of Bill C-14.
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What I will be talking about is primarily the rail transportation component of Bill C-14, although the bill is broader. I would like to bring to the attention of the House, and particularly to the attention of Liberal members, the market difference between rail transportation and other modes of transportation.
The best illustration that I can offer is the difference between rail and air transportation. When I want to fly home to Saskatchewan I go to the airport where I have access to more than one airline. I can decide what time I want to fly and which airline to use, based on the schedules and services they provide. Madam Speaker, when you want to fly back to New Brunswick you have some of the same opportunities. I suggest that when the Minister of Transport flies back to his riding in Victoria he also has a choice of airlines and times that he can fly. The same is true of the minister of agriculture when he flies back to Regina.
My constituents and thousands of prairie producers in the grain growing region of Canada are dependent on transportation for their very livelihood. However, they do not have the same options and opportunities as the Minister of Transport, the minister of agriculture or even you and I have, Madam Speaker, as to how we are going to get from here back to our ridings.
Prairie producers have to ship their commodity, primarily grain, through rail as it is the only commercially feasible means of transportation that they have. They are captive to two railways and at most times one railway. They have no opportunity to take their commodity down to the station to decide on which rail line they want to ship their products. That puts them in a category which is classified as being captive shippers.
It creates real problems for the industry if there is not legislation in place that ensures balance and fairness when disputes arise between the shipper and the transporter of these goods.
A couple of clauses in Bill C-14 are particularly obnoxious to shippers, primarily in the prairies but also right across the country. The most odious of these clauses in the bill are subclauses 27(2) and 27(3). The other clause that has caused a great deal of consternation is clause 112.
If it was just myself who was standing here and complaining about these clauses, perhaps members might question whether or not the concern was a significant factor. However, group after group appeared before the transport committee and talked about the inadequacies of Bill C-14 and particularly the clauses that I mentioned.
A number of shippers appeared before the committee. I have a partial list of those shippers which is a who's who of the shipping industry and farm organizations across the country. I am going to list a group of organizations which has stated their public concern or opposition to subclauses 27(2) and 27(3).
They include the Alberta Wheat Pool, the Saskatchewan Wheat Pool, the Manitoba Pool Elevators, the United Grain Growers, the Canadian Wheat Board, the Pioneer Grain Company, Cargill, the Western Canadian Shippers Coalition, the Canadian Dehydrators Association, the Canadian Fertilizer Institute, the Western Grain Elevator Association, the Canadian Federation of Agriculture, the Saskatchewan Association of Rural Municipalities, the National
Farmers Union, Southern Rails Co-operative, the Canadian Chemical Producers Association, the Atlantic Provinces Transportation Committee, the Ontario Ministry of Transportation, the Chamber of Maritime Commerce, Wabush Mines, Great Western Rural Development Corporation, Novacor Chemicals Limited, Luscar Ltd., Stelco. The list is longer but this is a who's who of shippers in Canada that have expressed opposition to subclauses 27(2) and 27(3) of Bill C-14.
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The shippers hoped they would have an opportunity to see the bill amended. They wanted to see clause 27 deleted from the bill. They asked the government to do that. The former Minister of Transport and the Liberal members on the committee refused, in spite of an overwhelming cry from people against this clause in the bill.
There was a cabinet shuffle and a new session of Parliament started after the Christmas holidays and the new year break. Hope was rekindled in the hearts of many farmers in western Canada and many shippers across the country that perhaps with this change of leadership in the Department of Transport, new members on the transport committee and time for the government to digest all of the opposition to Bill C-101, which became Bill C-14, that it might change its attitude and become more concerned about some very real problems that occurred with the bill.
Many people had an opportunity to contact the new minister and ask him, a western Canadian minister, to reconsider Bill C-14. As the member for Kindersley-Lloydminister on behalf of my constituents I wrote a letter to the minister on February 8. Unfortunately the minister has not even seen fit to answer my letter. I have not received a response even though it was written a month and a half ago. There seems to be no concern on the part of Liberal ministers to whether they answer their mail.
In my letter I stated: ``A number of farmers in the livestock industry in British Columbia have expressed some concern over legislation initiated by the previous Minister of Transport. Under Bill C-101'', and that is the number of the old bill, ``grain destined for export would be under a freight rate cap, whereas freight rates for grain intended for domestic use in British Columbia would not be capped. It has been suggested that rail rates to the lower mainland of British Columbia for grain would be approximately $10 a tonne higher than grain destined for the export market. The livestock industry feels that the $10 a tonne price difference will have a detrimental impact on farmers facing increased costs.
``As well, there is some concern by prairie producers that a two-tiered freight rate may instigate allegations from outside our borders that the lower rate is a subsidy unacceptable under GATT. A further concern expressed in no uncertain terms by shippers and producers of goods shipped by rail was a strong opposition to clause 27(2) of Bill C-101. It was argued that this clause provided the railway with an unfair advantage when challenged by shippers over unfair, insufficient or overpriced service. This factor is extremely important to shippers of prairie grain who are captive to the railroads.
``With that said, the Prime Minister's decision to prorogue Parliament has resulted in Bill C-101 dying on the Order Paper. If you intend to reintroduce similar legislation in the new session of Parliament, I would call on you to make the necessary changes to alleviate the discrepancy in freight rates and remove clause 27(2) from the bill''.
I felt that this would be just one more letter that would perhaps tip the scales in favour of the shippers to provide more neutral legislation, better legislation for the Canadian economy but the minister did not even have the good sense to answer my letter.
Mine was not the only letter. Other letters went out from shippers asking the minister to take this opportunity to reconsider the bill. In fact, the minister said: ``Come and talk to me. I am open to changing the bill. There is a good chance that we will change some of the more reprehensible clauses in the bill''.
A number of shippers came to Ottawa and met with the new Minister of Transport. They were very disappointed in the results of that meeting. I have a copy of a letter written to the minister by Mr. Alex Graham, president of the Alberta Wheat Pool. He is also the chairman of Prince Rupert Grain and Pacific Terminals:
The competitive access provisions provided in the legislation include the right of shippers to obtain a ruling from the Canadian Transportation Agency on rates or service, where the shipper has access to only one railway. As we said during our meeting, subsections 27(2) and (3) inject subjective language into the agency's decision-making process.
Our legal counsel advises us that any time subjective language is placed in legislation, it results in legal challenges to define the language. We have been told that the legislative requirement for the agency to be satisfied that the shipper will suffer ``substantial commercial harm'' could result in as many legal actions as there are negotiations with the railways.
Mr. Minister, during our meeting, and for the first time since this debate began, we were optimistic that our message was actually being received by the government. We were encouraged by your stated commitment to investigate fully our claims that these sections will result in increased litigation around applications to the Canadian Transportation Agency, and to take action if you found the claims to be valid.
However, as report stage debate began in the House of Commons this morning, without any indication of additional amendments to address our concerns, it appears that there was really no intention to address them in the first place.
As we said in our meeting, subsections 27(2) and (3) fly totally in the face of the intent of Bill C-14, which was to create a more commercial transportation environment, and to facilitate direct commercial negotiations on rates and services between shippers and carriers, without government or legal intervention.
The government's approach to developing this legislation also flies in the face of its promise to enhance the ability of Canadian industry to compete on world markets. As has been pointed out on many occasions, all of the major shippers in Canada called for the removal of subsections 27(2) and (3), citing the disastrous effects these subsections will have on their ability to negotiate with carriers, and to remain competitive. They were supported by four provincial governments, and by a number of industry and municipal associations. We are perplexed and disturbed that the government chose not to respond positively to this overwhelming consensus.
As long as this bill is before the House of Commons, Mr. Minister, you have the opportunity to make it right. In the interests of Canada's shippers, and the Canadian economy, we urge you to do so by removing subsections 27(2) and (3) or at least refer it back to the Standing Committee on Transport for specific and narrow examination before we all suffer the consequences.(1245)
That is a strongly worded letter from a respected person in the grains industry, someone whose constituency's livelihood depends on its ability to ship products at a fair price from the prairie region to port.
I also have a news release issued by United Grain Growers. It strongly condemns the government for the way it handled Bill C-14 with its heavy handed approach to saying it is interested in making some changes to the bill to make it more balanced as it relates to both shippers and the railroads, and then throwing dirt in its face, more or less, by slamming the door and saying it will not submit this bill to any changes whatsoever.
The government is ramming it through at report stage without considering any of the good amendments put forward, several by my colleague, the member for Kootenay West-Revelstoke, and by other members, which would have made the bill far more acceptable to the shippers.
To help us realize how important this is, the rail transportation sector, particularly in the prairies, used to be governed by the Western Grain Transportation Act, the WGTA. This legislation was considered to be shipper friendly. That is one reason the government brought in legislation that tipped the balance to being railway friendly, Bill C-14.
Under the Western Grain Transportation Act railways made their profits, guess where, shipping western grain. Here we had a piece of legislation that was shipper friendly and yet it was the shipping of prairie grain that was regulated under the act which provided the railways, CP and CN, with some of their largest profits.
It boggles my mind to think how we could tip the scales in favour of the railways and introduce and pass railway friendly legislation to allow the railways not only to make more money but to hold a hammer over the industry in such an unfair manner. For the Liberal government to be so unconcerned about that is beyond belief.
The people who presented the briefs to the transport committee, the many delegations that came as witnesses, must be shaking their heads. I read the list of the organizations that made submissions to the transport committee and said they had very grave concerns with this bill.
They must wonder why they bothered coming to Ottawa. There was clear consensus that there needed to be changes to this bill. This is one of the most clear indications of concern in a bill that I have seen since I have been here after first being elected to the House in 1993.
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I have never seen such a strong, united effort on the part of the grains industry. One criticism of the industry is that it never gets its act together. One group will tell Ottawa it must do this, and the next group will say no, it has to go in the other direction. This did not happen in this case.
The groups that appeared for the transport committee were almost united in the their condemnation of clause 27(2) and clause 112. Yet the government chose to ignore them. It did not seem to care. Perhaps adding 5 cents more in value to CN shares it was selling was more important than the entire western grains industry; not only western grain but potash, iron ore and coal.
We have talked a lot about Atlantic Canada. Some Liberals from Atlantic Canada who just toed the party line as they had been told have asked why we suddenly have an interest in Atlantic Canada. One group that appeared before the committee was Wabash Mines from Labrador. It told us the bill was flawed and needed to be changed. It was not only western Canadians who were concerned; the concern came from across the country.
Did the members who serve that part of the country speak on behalf of the livelihood of their constituents, the job creators in their constituencies? No, they were silent. They let the flawed legislation progress and did not even speak against it. This is truly unfortunate.
Now we are at third reading. This is our final chance to debate Bill C-14. It cannot be amended in any substantive way. We can no longer delete clauses. We have gone past that stage. It is very sad to realize that so many people were opposed to a piece of legislation and the government would not budge. In the past significant concessions have usually been made when there was general opposition to a bill not only from members across the floor but from the public at large. However, in this case the government chose to have deaf ears and not hear what Canadians were saying.
This is extremely unfortunate. It means the bill will have to be changed in the future and it will be a lengthy process. I assure the House that there are members on this side listening to Canadians. We are taking notes and there will be a day of reckoning for the
arrogance of the Liberals and their inability to hear the concerns of Canadians.
I am thankful that through the democratic election process we will have a chance in the future to redress these wrongs.
[Translation]
Mr. Ghislain Lebel (Chambly, BQ): Madam Speaker, this morning, I heard the minister praise Bill C-14, which is only Bill C-101 reinstated under that new name after the hearing in committee.
The minister presented that bill as something totally new, something we could never hope for, something never yet submitted. The bill as such is not a bad one. I think we must be honest and, even if we are the opposition, admit that the minister meant well when he created what we will now call the Canadian Transportation Agency.
But, we are conferring powers to that office and this is where the minister should have paid attention to the recommendations of the opposition. Members of the opposition, even if they are Quebecers and sovereignists, are well aware of the fact that rail transportation in Canada, as air and sea transportation, has a great impact on their daily lives.
For example, the Reform member just spoke about mining companies owning private railways, such as the Wabush Mine and Iron Ore Company of Canada in Sept-Īles which also serves Labrador through the Quebec North Shore and Labrador Railway. So there are railways in Canada that will be affected by the provisions of the bill and by the regulations which will stem from it.
On that point, the minister should have listened to members of both opposition parties who made recommendations, because the Reform members also raised serious objections just as the members of the official opposition did.
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Since party line rules in these committees, none of the proposals of the official opposition, none of the some 35 motions that we introduced, were accepted. Yet, they would have improved the bill and the transport industry in Canada, whether it be rail, air or maritime transport.
Personally, there is one thing I would like to tell the Minister of Transport. In the old days, last century, an independent colony had been set up because of the vastness of the country and, at the time, settlers were promised a dreamland, a country where remoteness, for example, would no longer be a problem.
They wanted to build a country then. Therefore, those who agreed to go further north, farther into the cold or into difficult terrain, in areas barely accessible, were told that people in large urban areas like Montreal, long before Toronto, were going to help pay the additional costs incurred because of the vastness of the country.
That view of things prevailed until recently, I would even say until today, but at least until 1987. Consequently people in remote areas knew that, despite everything, they would be in constant communication with the heart of the country, that is Montreal, Toronto or Ottawa, at a relatively reasonable cost. Of course, the real cost of operation was not fully reflected in what they paid since the community as a whole had chosen to assume a large part of these costs because people in remote areas were opening up new territories.
We know that an east-west railway was a main concern of the British government which feared at that time that Americans would push into Canada, court the settlers, and try to create a huge American entity. That was the main concern of the British government.
As you know, following the Halsbury Treaty of 1843, the British government had clearly defined borders between Canada and the United States. However, that border was contested especially in the west. American presidents who had expansionist views wanted their rights recognized, precisely at a time when the French speaking population-the friends of the hon. member for St. Boniface-was rebelling.
Even then, the Fenians, Irishmen living in the United States, had extremely expansionist designs. They tried to convince the American president to push toward the west, toward the north-west. That is what prevailed during the establishment of our railway system, our railways and much later, of course, air transportation.
Today this bill might be an attempt to achieve greater effectiveness. It is understandable that because of the globalization of markets-it is one of its effects-in order to be competitive we must-to put it rather inelegantly-``flush remote communities down the toilet'' because they cost too much. The cost of serving them is invariably or inevitably reflected in average administrative costs and our transportation costs are a little bit higher than those of our neighbours. This is reflected in our production costs and our products as well.
It is probably in order to respond to market requirements under all kinds of treaties, dictates of trading in the year 2000, of modern trade, that the Canadian government, through this bill, is making a clean sweep of its past, completely denying the very rationale for our railway system.
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I want to talk about the more legal aspect of the bill, because my colleagues, the hon. member in front of me and my friend from Blainville-Deux-Montagnes, have amply demonstrated the flaws in this bill. Without underestimating the seriousness of their judgments, which incidentally I agree with, I would like, neverthe-
less, to talk about the perhaps more regulatory or legislative aspect of the bill.
The government is creating a commission or at least is transforming a commission that already existed with certain powers, giving it a new name. Then it says clearly in the bill that this agency will have the powers of a court. This is not bad in itself. In our parliamentary system, there are many agencies that have quasi-judicial powers. But, to reinforce these powers, the bill says that the agency's decisions may be approved by a superior court in a province, for example, the Superior Court of Quebec, the supreme courts of the maritime provinces, for instance, the Supreme Court of Nova Scotia, and the other Supreme Courts of British Columbia.
So, the agency was given teeth, was given the power to use its teeth and also the power to regulate, to legislate, a delegated legislative power. Where I have something against this procedure, which tends to extend to almost all government services at the present time, is that, once the agencies are created, parliamentary control is non-existent. Parliament does not have control over its agency any more.
The agency may edict regulations and determine whether they are appropriate or not. In short, an agency is asked to do the legislative work instead of the legislator. Within the bill, the minister still retains the power to intervene, perhaps in a slightly arbitrary manner, because he would not be called on to intervene by this House, but at his own discretion. He is the only judge of the appropriateness of the intervention; only he can decide whether the intervention is justified or not. He may, through the governor in council, make regulations or directions for the Canadian Transportation Agency, but without consulting the House in any way.
This is where it becomes sad. When we look at this, after the bills that were introduced last session-I am thinking specifically of Bill C-62 on regulation, and also Bill C-84, which amended the Statutory Instruments Act-we see that the government is showing great single-mindedness. All it is trying to do at this point is to push aside those who were elected to think, to discuss, to develop, to set objectives. It is faster to push us aside, thus allowing them to move forward without being tripped up.
Although this may sometimes be desirable, what will happen to Canada's railway system 15 or 20 years from now, for example? Even the minister would be unable to tell us, because he has no vision, no long term policy for developing Canada's railways. I think this government is showing us that it has thrown up its hands. It is selling off Canada's railways a little more slowly so as to save the best assets, but still moving inexorably toward their total dismantling. The government does not, however, have the courage to admit this to the people. The government goes all over the place boasting about this great country with communications from coast to coast, from east to west, from north to south, when it is in fact systematically shutting down our railway system.
(1305)
I was looking at clause 25. Here we have a legal device of which we are becoming increasingly aware. The government creates an agency that is responsible for developing policies and regulations and, by virtue of its status as a superior court, judging those who could violate or be subject to these regulations. So, this court is no longer independent. It is losing its independence because it is responsible for both making legislation and enforcing it.
In our parliamentary system, we all know that when questioning the validity of a law, we can go before a tribunal that hopefully is independent. It is a bit like a divorce, where one party wishes to appear before the divorce court having jurisdiction in the area, while the other says: ``Oh no. We will not take this matter to a common law court, but to my mother. She is the one who will decide who is right.''
Can you imagine where this could lead? We could end up with decisions that would be legal monsters. This is precisely what we are about to do with this agency, with the new powers we are giving it, powers that are completely unlimited.
The Standing Joint Committee on Scrutiny of Regulations is specially appointed by the Speaker of the House and mandated by Parliament to study subordinate legislation. It acts as a watchdog for rights conferred by statute.
This committee has no interest in having a regulation quashed, replaced or enforced. Its only purpose is to verify compliance between regulations and the statutes that have been adopted and enacted by Parliament. For 20 or 25 years, this committee has reported regularly to the House, and the government has responded to its reports. Not so long ago, as we were submitting a report to the House, ministers wrote us saying: ``Yes, we do realize that such subordinate legislation is justified, or is not justified''.
Here, it is no longer possible. What monitoring power does Parliament have over an agency whose decisions are final and may not be appealed, as per clause 25? None. There is no such power left. Is the government trying to render Parliament ineffectual? Is it trying to transform it into an empty shell? Is it trying to turn the 300 or so members in this House into insignificant bystanders?
Everything will be decided by a few ministers who are close to the Prime Minister. From now on, these people will control practically all of Canada's economic, social and political development. We must put a stop to that. This can no longer go on. Where will this take us?
Earlier, we referred to Bill C-62. Public servants, we do not know which ones exactly-either at the top or the bottom-had the power to set standards that could be complied with, or not, subject to an exemption or a fee, or provided an alternative solution could
be found. This opened the doors wide to the lobbyists in Canada, and was unheard of.
(1310)
Some weeks or months before, the Prime Minister had talked about introducing a bill. That was done with Bill C-41, which dealt with lobbyists on Parliament Hill. So, there is an incredible discrepancy between the statements made by ministers taken together, and those made by a minister alone. There is something wrong.
If government members will not do it officially, I ask them to at least tell their ministers, in caucus, that they have to shape up because the situation no longer makes sense.
In the end, we will hear about bills and acts of Parliament by reading about them in the newspapers, and the decisions will have been made by a handful of people. Consultation and democracy are on the way out in this country. So, as far as the regulatory powers are concerned, they will have to be reviewed, frankly, because we are in the process of making terrible mistakes.
I would like to deal briefly also with clause 104 and the following clauses of the bill. When the bill deals with mortgages, it is to allow mortgaging by SLR, the definition of which escapes me, but it relates to small, secondary railways.
An hon. member: Short line railways.
Mr. Lebel: Exactly, short line railways. We know that they are owned by groups of business people, often with limited financial resources, who have joined forces to buy a section of railway from the CN, the CP or some other railway company. Those railways are then given the right to mortgage the rolling stock. However, the bill is very evasive about the mode of publication of the mortgage or about its rank when there are several mortgages. If there are two, three or four, which one comes first? Will mortgage rank be determined by precedence of registration or of publication? The bill is totally silent on that.
With regard to the mortgage on movable property, there are provisions about that in Quebec legislation, but the bill is silent on that. So, railway cars could be seen as movable property. In Quebec, immovable property by destination has been eliminated under the new Civil Code. So, one could register in the registry of real or personal property in Montreal a mortgage on railway cars, whereas someone else would register the same property pursuant to clause 104 at the office of the registrar. Which one would take precedence? That is something that was completely overlooked, and I would like the minister to reply on these points.
Mr. Ronald J. Duhamel (St. Boniface, Lib.): Madam Speaker, I want to make a few comments and ask a few questions. You will remember that, earlier today, I pointed out to one of my colleagues from the same political party that he had made a mistake and I would like to quote the exact clause we were talking about. Then, I will tie up my comment to what my colleague just said and which is unfair and incorrect.
Clause 102 reads as follows:
102.If an owner's land is divided as a result of the construction of a railway line, the railway company shall, at the owner's request, construct a suitable crossing for the owner's enjoyment of the land.And then in clause 103, it says:
103.(1) If a railway company and an owner of land adjoining the company's railway do not agree on the construction of a crossing across the railway, the Agency, on the application of the owner, may order the company to construct a suitable crossing if the Agency considers-I made the same comment this morning, because the hon. member's colleague who spoke before said something else. I do not mean to say that he did not tell the truth, since he may have made a mistake, but what he said in the exact opposite of what I just said.
Having said that, I now worry about the Bloc members, because my colleague talks about a court which would not be unbiased. I find this shocking.
(1315)
Then he says that Parliament gives it directions it must abide by, but then he argues that the court is not free, or rather that it is free, I do not know what his argument was all about. It is all very conflicting.
For my colleague's information, I would like to quote the following: ``A direction issued under subsection (1) shall not affect a matter that is before the Agency on the date of the direction and that relates to a particular person''. And then: ``A direction issued under section 43 is not binding on the Agency until the expiration of the thirtieth sitting day of Parliament after the direction has been laid before both Houses-''
This is a clear indication that there is a process in place, that the process is open and public, that it will be referred to Parliament, to a committee for further debate, etc.
If I had listened to every member of his party, I would have found similar mistakes. This morning, when I quoted from the document, why did his colleague not mention this mistake, why does he not recognize that we have an unbiased court and an open process, that what we are doing is both honest and right? Why are they always so negative when they do not need to?
Mr. Lebel: Madam Speaker, the hon. member for St. Boniface quoted the first paragraph of clause 103, but he should have quoted up to and including the third paragraph. It is said that we should always assume that things are done in good faith but I am wondering if this applies in the hon. member's case.
The hon. member for St. Boniface should read clause 103(3):
The owner of the land shall pay the costs of constructing and maintaining the crossing.Mr. Duhamel: If he buys a second piece of land.
Mr. Lebel: The hon. member says: ``If he buys a second piece of land.'' Maybe he had too much beef from England to eat, too much British cow.
It is specified in clause 103. The hon. member for St. Boniface is a sly one. He rises in the House to add or remove from the bill as he wishes.
Mr. Duhamel: That is it. I am writing my bills on the spot.
Mr. Lebel: The hon. member quoted the first two paragraphs of a clause, completely ignoring the third, which is precisely the one that the hon. member for Frontenac objected to this morning.
Partial as he is, not only does he not read between the lines but he does not even read the lines themselves. That is what I blame him for.
Mr. Duhamel: I do not doubt it.
Mr. Lebel: The hon. member for St. Boniface has interrupted me so much that he has finally succeeded in making me lose all concentration. I am still wondering where he was going with his second question and even what this question was. But I can tell you that the hon. member for Frontenac had raised this issue in good faith. He had also spoken of the environmental study. The member does not want to go back over that. Regarding the environmental assessments, nowhere is it mentioned in this bill that the person must conduct these assessments before getting the certificate of fitness required to operate a railway. It is not mentioned anywhere.
I agree with the member for St. Boniface that there is an act which requires the conduct of environmental assessments when the federal government and a province are involved. But it is far from being obvious that the environmental assessment act would apply to a SLR, a railway constructed and operated by an individual like the member for St. Boniface or myself.
The member for St. Boniface knows that very well. He does not mention it because it does not bring grist to his mill.
Mr. Duhamel: Is the court unbiased?
Mr. Lebel: Take an act, any act. Parliament enacts it and the court has to monitor its enforcement. But if the court establishes its own rules and says to the taxpayer that he did not comply with it, I would say to the member for St. Boniface that it is clearly in conflict of interest! What else does it take to make him understand the difference between a conflict of interest and impartiality?
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Hon. Charles Caccia (Davenport, Lib.): Madam Speaker, first, I would like to congratulate you on your appointment to a position of responsibility. I am sure you will fill it with honour and a great sense of responsibility and wisdom.
[English]
I will say a few words on sustainable transport. The bill, which is former Bill C-101, lends itself very much to some considerations that ought to be related to the overall context of sustainable transport. In the 1993 red book as a party platform we devoted an entire chapter to sustainable development. Therefore, it is appropriate that we endeavour to launch new policies, including transportation policies within that overall concept.
This is not a new thought. It was adopted in Bill C-46 when the new Department of Industry was launched a couple of years ago. The same happened by incorporating a reference to sustainable development in Bill C-48 which bill created the new Department of Natural Resources. More recently the House debated and approved the creation of the position of the Commissioner for Sustainable Development which I believe was followed by a proclamation in December.
Therefore, it would make political logic to also insert the concept in the National Transportation Act and consolidation of the Railway Act and to put forward some thoughts on sustainable development. I will do that very briefly.
I congratulate the former minister who produced the bill, a massive effort no doubt, and for having decided that this aspect of our economy needs rationalization. We fully agree with him.
There is something which would have carried the matter a step further and would have been desirable. In section 5 of the act under the declaration section a reference is missing, one that would refer to the need for our national transportation system to be operated and developed in keeping with the principles of sustainable development. It is unfortunate it has not taken place yet. Those principles can be found in the legislation I referred to a moment ago which will be guiding the activities of the Commissioner for Sustainable Development in the auditor general's office. It is a set of principles which would be extremely useful within the context of national transportation.
Let me explain what sustainable transportation really means. It means a number of things. It means finding ways of reducing carbon dioxide emissions, keeping in mind the commitment we made internationally of stabilizing our carbon dioxide emissions and reducing them after the year 2000. It means keeping in mind that damage to the atmosphere is caused by air traffic in particular, which is an issue that needs to be addressed and is a matter of increasing urgency. It means that within the context of ground transportation we want to encourage movement of people with the
least consumption of energy, with the least production of pollution, with the least congestion of traffic. We want to find ways of transportation that move people with the lowest energy consumption per unit.
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Finally I might add the necessity of conducting research for alternative fuels for the ones we are presently using. Research badly needs a shift in emphasis from the one we have so far applied when it comes to the energy sector.
The Ontario Round Table on Environment and the Economy has produced a number of interesting sectoral task force reports. Carbon dioxide emissions related to transportation account for 31 per cent of all emissions. Of this 31 per cent, the largest component, to the extent of 81 per cent is attributed to road transportation.
Imagine the importance of short, medium or long distance railway transportation in relation to the impact it could have in reducing the dependence on road transportation. This debate is not new on this continent but it has to be raised at every opportunity which is what I am doing today.
Rail transport produces significantly lower emissions per tonne of freight carried than does road transport. Tables and studies have been produced to this effect. For every tonne of freight switched from road to rail, energy used is reduced by some 86 per cent which is a considerable amount.
The ``Green Paper on the Impact of Transport on the Environment: A Community Strategy for Sustainable Mobility'' was produced by the Commission of European Communities. It confirms the results of the Ontario round table to which I referred earlier.
In December 1995 the Standing Committee on Environment and Sustainable Development produced a report entitled ``Keeping a Promise Towards a Sustainable Budget'' and dealt with the question of transportation and sustainable development albeit perhaps in a superficial manner. We came to the conclusion that the transportation system in Canada is currently not sustainable and requires significant changes. I refer particularly to pages 23 to 27 of that report.
We were quite struck by the submission by a witness on behalf of the Transportation Association of Canada who stated that the playing field in transportation is anything but level. I quote: ``It is tilted in favour of the automobile and there are many reasons for this. Our cities have been designed for cars. Cars would never have gained the popularity they have today if it had not been for roadway infrastructure provided for by the public purse. We need to tilt the playing field away from the single occupant auto and more in the direction of other means of transportation including of course railway''. This is what the Transportation Association of Canada is advocating.
Two of the witnesses before our committee said that the laws should be changed and a tax exemption made for employer provided transit passes. Around Montreal, Toronto and Vancouver there are a number of short railway systems which move commuters in rush hour and therefore the question of transit passes is relevant. Such a move, namely the employer provided transit pass, would encourage employees to use public transit rather than single occupancy automobiles. This would reduce energy consumption, decrease atmospheric pollution, reduce traffic congestion and the like. An initiative of this kind would send a strong signal to employers and to society in general about the need to change attitudes toward urban transportation.
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The recommendation which emerged as a result of the consultation was that the Income Tax Act be amended to provide a tax exemption for employer provided transit passes to encourage people to use public transit rather than private automobiles. The change would apply to any future taxation year. The applicability of this would not be for rural Canada but for urban Canada and the transit railway systems that surround and feed into our major metropolises.
It would also be interesting to put on the record another recommendation to the effect that the federal government put in place a surcharge on the purchase of new fuel inefficient vehicles and redirect the revenue to a fund dedicated to improving the sustainability of Canadian transportation. This may sound a bit like pie in the sky but nevertheless it is a germ of an idea whose time will come and which could be implemented with perhaps some modification.
Another recommendation on the subject of sustainable transport is directed to the Minister of Finance and the Minister of Transport. They are being asked to re-evaluate the subsidies that are being directed to the railways and to road construction and maintenance in the context of sustainable transportation. They are being asked to determine whether a new allocation of resources between rail and road funding is needed and desirable at this time.
No doubt it is good that we have a bill to streamline rail regulations and promote the formation of short line railways. The question, however, which arises in this debate is whether we have the environmental and economic impacts available of the proposed short lines and have these impacts been studied.
These are factors of some importance because of the carbon dioxide emission issue, per tonne of freight in this case, and because of the fact that the emissions by the railway system are much smaller per unit transported than the emissions by road.
Taking this fact into consideration, environmental and economic impact studies are needed to ensure that the lines proposed by this bill will not result in greater road transport and hence greater carbon dioxide emissions because this would be contrary to everything we are trying to do under sustainable development.
I appreciate the fact that this debate on road transport versus rail transport is one which has bedevilled the imagination and skills of many governments and politicians before. It is not the first time it has been raised. However, it is becoming more and more relevant because of the urbanization of Canada and the increase in concentration of people in our urban centres, therefore, the transport requirement by rail and ground that follow this type of human settlement which is converging into our urban centres.
This kind of debate would have been much less significant 100 or even 50 years ago but it will be extremely relevant in the decades ahead.
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I congratulate the government on this initiative. However, I would urge it to develop a sustainable transportation policy which would take into account the impact of carbon dioxide emissions on climate change. We must come to grips with those modes of transportation which are more energy efficient than the ones we presently have.
I would also urge the government to identify subsidies which are not desirable in the achievement of sustainable environmental goals and to identify modes of transportation which are less consuming and less polluting than the ones on which we rely today.
Mr. John Williams (St. Albert, Ref.): Madam Speaker, it is a pleasure to speak to Bill C-14. I note that this is a rehash of Bill C-101 which the government forced back into the House after it died on the Order Paper when Parliament was prorogued. It is a travesty of the democratic process, but nonetheless we are talking about it once more.
Unlike the previous speaker, I cannot find it in my heart to compliment the government for introducing the bill. I believe it has some serious shortcomings. However, our role is to be critical of legislation introduced by the government and the Reform Party has been doing an excellent job in that role.
Hon. members may have noticed the results of the byelections last night. The Reform Party gained considerable ground in Atlantic Canada and in Etobicoke North. Obviously the people are quite concerned about the message being delivered by the government. The way it is running the country is coming under closer and closer scrutiny. At the next election, when Canadians are given a real choice, they will choose something else, such as Reform.
The intention of the government in Bill C-14 is to regularize or streamline the process by which the main railway companies can abandon rail lines. I am thinking about the government's platform of jobs, jobs, jobs. With this bill it is creating an easier opportunity for the rail companies to abandon lines instead of maintaining them. All the jobs that go along with those lines will be lost.
The communities served along those lines will be diminished. Rural Canada will find it more difficult to maintain itself on a sustainable basis when competing with urban centres.
However, the government finds it quite appropriate to introduce rules and regulations which will make it easier for those companies to abandon lines. They will still have to justify what they are trying to do, but the government has given them a mechanism whereby they can say: ``We will allow this line to deteriorate and we will abandon it without any real public input''. It is shocking because this is the government that ran on jobs, jobs, jobs.
From the Reform point of view, a job in the country is every bit as important as a job in the city. Rural Canada is in jeopardy. It would have been a great opportunity for the government to protect and sustain rural Canada and rejuvenate the small cities and towns which have a way of life that is fading fast. It is a way of life that has produced great Canadians. It provides an opportunity for parents to raise their children without concerning themselves with crime and other things that little kids should not be getting into. It was a wonderful opportunity, but it is gone.
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Let us look at the other side of the coin. If it is the government's intention to allow the railroads to abandon tracks, why is it not coming up with a plan to encourage small business entrepreneurs to operate these branch lines?
Unfortunately these small entrepreneurial companies do not seem to be of any concern to the government. It is just concerned with the big picture. As long as it can say that jobs, jobs, jobs are being created, it does not care about the small business entrepreneur who could help achieve that objective. The government has done nothing to create an environment in which these entrepreneurs could compete successfully by taking up the challenge of rejuvenating branch lines which are being abandoned by the major railroads. It is a great opportunity missed totally and completely by the government which does not seem to care.
Some branch lines in Alberta are run by small organizations. The member for Crowfoot has a branch line going through his riding. It is working profitably. It provides much better service that the major railroads. It is responsive to clientele. Its frequency is much
improved. It does not wait until there are 100 cars before it sends a train down the line. If there is grain to be moved the train is there.
It is time for us to recognize that small business entrepreneurs are capable of running railroads every bit as good as the large monoliths that are now being given the opportunity to abandon rail lines across the country. These railroads have been instrumental in the development and building of our nation. It is tragic to see them go.
The elevators are going along with them. My eldest son laments every time he hears about a grain elevator being demolished because he sees it as a part of our history disappearing. He is only 17, yet he realizes they are part of our history and will never return, again courtesy of this government. It does not have the foresight and the vision to realize that jobs can be created and protected.
I will now discuss another area of concern to my riding, the alfalfa business. I have been critical of the government in its treatment of the railroads by allowing them to abandon Canadian jobs. The alfalfa business is being treated in exactly the same way.
The alfalfa business has over 1,000 directly related jobs, yet the government ran roughshod over the entire industry when it cancelled the WGTA program. It did not give a hoot about the industry and how it will work in the new environment which has been forced on it.
As I have said, over 1,000 jobs are directly maintained in rural Canada. They are dependent on the alfalfa business, not to mention those spin-off jobs related to repair and maintenance. It is a $100 million export business. It generates the better part of $100 million in revenues although the government does not seem to care.
When the government eliminated the WGTA, the subsidy program for the railroads from which the alfalfa industry obtained a benefit, it did not consider the specific concerns and needs of the alfalfa industry. Alfalfa is a high volume, low value product. It is not like cereals which are low volume, high value. Yet the alfalfa industry has been eliminated from the subsidy entirely. Therefore, the elimination of the subsidy will cause the cost of transportation to increase much more dramatically for the alfalfa industry than for the grain growers.
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We know the grain growers received $1.6 billion as a final settlement. The alfalfa people are going to get $40 million. However, it does not stop there. The $1.6 billion being paid to farmers allows them to reduce the capital cost of their land and therefore is non-taxable. They are allowed to keep the money.
Because land is not a depreciable asset, farmers can leave that reduced capital cost sitting on their financial statements until they retire. Then of course there is the $500,000 capital gains exemption for farmers when they sell out at retirement. This $1.6 billion is by and large going to flow through to farmers tax free.
This is not so in the alfalfa business because those people are not really in the business of land ownership. They will have to pay tax on this money if it is income, and there is a reasonable chance Revenue Canada will declare this to be income rather than a capital cost subsidy. If it does that at a 50 per cent tax rate, the $40 million subsidy becomes a $20 million subsidy because the government will claw $20 million of the $40 million right back into its own pocket. That is not going to do the alfalfa industry much good.
On the other hand, the government may say that this can be applied to capital. Unlike the farmers who can reduce their land values, they will have to acquire depreciable assets. This means they will be denied capital cost allowance by virtue of the grant and over the next few years will be paying higher taxes.
Again the government will get the $20 million back and not one penny of it will benefit the alfalfa industry. This is Canada we are talking about, a country in which this government does not seem to care about the small entrepreneur, the railroads.
This government does not seem to care about the small plants in my riding that generate jobs in rural Canada which are seriously in jeopardy because this government, even though it ran on the platform of jobs, jobs, jobs, is sitting back while its policy changes are putting these jobs in jeopardy, if not destroying them. It does not seem to care.
That is the type of legacy this government is leaving for Canadians. I and the people in my riding do not like it one bit. I can assure the government that there is absolutely no support from the people in the alfalfa business in Legal, Alberta, which is part of my riding.
The alfalfa people have been asking for about a $70 million subsidy. They feel that on a pro rata basis that is much more appropriate than the $40 million less tax being handed out by this government. That is why they are asking for $70 million and that is why they are asking that this amount be given as a prescribed amount, which allows it to be income tax exempt and allows them to get the money on the same basis as the farmers are getting.
If that type of insult were not enough, when the minister of agriculture announced the cancellation of the WGTA program and the introduction of the final payment, rather than paying the final payment on arable acres, he decreed that it was to be paid on land where cereals are being grown. Therefore the payment was denied to farmers who were growing alfalfa in that particular year.
I listened to the previous speaker tell us how concerned he was about sustainable development. Sustainable development is good but sustainable farming includes growing alfalfa periodically.
Because farmers were maintaining a policy of sustainable farming, the minister of agriculture said: ``Tough if you happen to be growing alfalfa this year because you are not going to participate in the final payout under the WGTA that every other farmer who was growing cereal that year was able to participate in''. If one member of the government speaks about sustainable development, we should also hear from the minister of agriculture and everyone else on the other side of the House.
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We in the opposition agree with sustainable development and sustainable agriculture. Canadians agree with it. Why do we not hear from the minister of agriculture? Does he not care about the small alfalfa plant which generates $100 million worth of exports for this country, sustains 1,000 jobs in this country and pays taxes in this country like everyone else? He does not seem to care.
It is a disgrace for me to stand and accuse the minister of agriculture in that way but the unfortunate news is it is true.
I could go on about the alfalfa business, but the point is it is entitled to a fair shake. As farmers, as producers, as rural Canadians, as people who are participating in this economy and as people who are trying to make a living in Alberta while this government keeps pulling the rug out from underneath them, surely they deserve the same type of treatment as cereal growing farmers and as the railroads which are being allowed to abandon entire branch lines, perhaps even the branch line that services the alfalfa plant. Who knows, maybe in five years even it could be gone.
Finally we have the announcement by the Minister of Finance in the budget that he will be selling off these railway cars. He will allow a surcharge of 75 cents a tonne for the movement of commodities. Who will get hurt the most? Again, it is the alfalfa industry. It has high volume and low value. It has to move its product from the prairies to the coast for export to Japan which is a large consumer of the alfalfa pellets. What do we have? Another charge being levied on it.
It has not even had the opportunity to adjust, reinvest and improve its productivity to accommodate the elimination of the WGTA. Now it will get hit with a 75 cent a tonne surcharge, compliments of the Minister of Finance. After having dealt with the minister of agriculture, the industry now has another minister coming at it. Where will it stop? Is it the intention of this government to beat it into the ground, suffer the losses of jobs, suffer the decline of rural Canada and allow the railroads to dictate the policies of this government by asking for the authority to abandon lines as they so desire?
The government has a lot to answer for. With a bit of homework it could do a lot better. I expected that with this bill we could have had a lot better.
[Translation]
Mr. Paul Mercier (Blainville-Deux-Montagnes, BQ): Madam Speaker, I would like to put a question to my colleague from the Reform Party on the part of his speech which focuses on short lines.
It is not frequent for a member of my party to agree with a member of the Reform Party, so I did not want it to go unnoticed. It so happens that my honourable colleague rightly says that the bill does not give enough support to small businesses which intend to take over parts of the lines the big companies wish to abandon. He also says that these small businesses can manage the lines as well as the big companies.
I would even go further. Often times, they can manage them better because they succeed where the big companies have failed and, as the minister himself said this morning, in the United States, it is these short lines that truly saved the American network. Just like small streams feed big rivers, short lines feed larger ones.
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Our party was suggesting two things to help the SLRs. First, we suggested that loans be given to small companies so they could rehabilitate the lines. As the hon. member probably knows, the big companies did not maintain short lines hoping that the service would deteriorate and that as a consequence people would stop using them which, in turn, allowed them to ask that the lines be abandoned. Today, when the National Transportation Agency authorizes a company to abandon a branch line, we can find buyers for that line but it is usually a small company which is not strong enough or does not have the money necessary to rehabilitate the line that was deliberately neglected.
I would like to ask my colleague what he thinks of our two suggestions which are: First, to give interest-free loans to small companies that want to buy branch lines, provided they rehabilitate those lines; and second, that the federal government creates its own branch line rehabilitation program since it is responsible for the present state of those lines.
What does the hon. member think of our suggestions? Does he himself have suggestions to help SLRs?
[English]
Mr. Williams: Madam Speaker, I would like to respond to and agree with the points raised by the hon. member.
We are fully aware that in many cases, years before a line is finally abandoned, the railroad sets it apart, ignores it and allows it to fall into disrepair and decay. After that, it can come before the National Transportation Agency and say: ``Look how much money it will cost to fix it up. Look how little traffic there is. This line is uneconomical and we want to close it down''.
Lack of maintenance, management and marketing leads to the decline of that particular line and the community which goes along with it. Therefore I think the hon. member has made a good suggestion. If we were to ask the railroads to finance, interest free, the rejuvenation of these branch lines then it would ensure that the railroads would not allow the lines to fall into a state of disrepair to begin with.
I do not see that the onus is on the government to pick up where the responsibilities of the railroads left off. I would think we would want to put it right back squarely in the lap of the railway companies to ensure they realize their responsibilities are to maintain adequate rail service in the country.
The Speaker: It being about 2 p.m., we will now proceed to Statements by Members.