Bill C-8 (Historical)

An Act to amend the Canada Transportation Act (railway transportation)

This enactment amends the Canada Transportation Act with respect to railway transportation.

The House resumed from December 10 consideration of the motion that Bill C-8, an act to amend the Canada Transportation Act (railway transportation), be read the third time and passed.

Canada Transportation Act

[Robert Carrier, Bloc, Alfred-Pellan, QC]

Mr. Speaker, I was talking about the final item to be amended by this bill. It is important to continue. The seventh aim is to ensure that the abandonment and transfer provisions apply to lines that are transferred to local lines under provincial jurisdiction and subsequently revert to a federal railway, including the obligation to honour contracts with public passenger service providers.

Those are the amendments proposed by the bill. Indeed, the main point of this bill has to do with the disagreements between the western grain transporters and the railway companies. Although this is happening outside Quebec, the Bloc Québécois is interested in playing a constructive role and always defending the interests of those who are not treated fairly.

Bill C-8 is an attempt to strike a better balance between the power of the railway companies and the people who produce and ship products, including grain producers, who do not own the rails and who have to get their hopper cars to destinations all over Canada. They feel oppressed by the railway companies. Thus, the purpose of this bill is to strike a balance.

The proposed amendments respond to the concerns of shippers—particularly western Canadian grain producers—about railway transportation prices and services, while also providing the railways with regulatory stability. It is time to improve the balance for grain producers, among others, who use their own railway cars. The Conservative government and the Liberals have often had the tendency of giving free reign to the market, with the result that some producers may have been exploited.

Various amendments also affect arbitration. The objectives of the Canada Transportation Act, prior to these amendments, required that the Canadian Transportation Agency take into account the matter of substantial commercial harm. Bill C-8 proposes to remove the reference to substantial commercial harm, because there was always substantial harm when the Canadian Transportation Agency had to hear the arguments of the railway companies.

In the end, those who do not own the rails lose every time. The railway companies always succeed in proving substantial commercial harm where there is none. That will now be subject to arbitration, which will be a means of settling disputes between shippers and the railways—

[Robert Carrier, Bloc, Alfred-Pellan, QC]

Mr. Speaker, I am pleased to speak to Bill C-8, which has been considered and is at third reading. I must point out, this was formerly Bill C-58, before Parliament was prorogued and the bill was at second reading. Committee work has continued during this session and we are now at the third reading stage.

The main purpose of this bill is to clarify the Canada Transportation Act and strengthen the existing provisions that protect shippers against any abuse of the commercial power of the railways. It relates mainly to western Canada's grain producers and shippers.

In order to make it clear for those who are currently watching us debate this bill, I think it is important to list the main aspects of it.

First, one of the purposes of the bill is to remove the requirement for the Canadian Transportation Agency to be satisfied that a shipper would suffer substantial commercial harm before it grants a remedy, as it is an unwanted barrier to regulatory remedies.

Second, the bill extends final offer arbitration to groups of shippers on matters relating to rates or conditions for the movement of goods, provided the matter submitted for arbitration is common to all and the shippers make a joint offer that applies to all of them.

Third, the bill allows for the suspension of any final offer arbitration process, if both parties consent to pursue mediation.

Fourth, the bill permits the Agency, upon complaint by a shipper, to investigate charges and conditions for incidental services and those related to the movement of traffic contained in a tariff that are of general application, and to establish new charges or terms and conditions if it finds those in the tariff to be unreasonable.

Fifth, the bill increases the notice period for augmentations in rates for the movement of traffic from 20 to 30 days to ensure that shippers receive adequate notice of rate increases.

Sixth, the bill requires railways to publish a list of rail sidings available for grain producer car loadings and to give 60 days notice before removing such sidings from operation.

And finally, the bill ensures—

[Joe Volpe, Liberal, Eglinton—Lawrence, ON]

Mr. Speaker, I thank the House for giving me the opportunity to voice the position of the Liberal Party, the former Government of Canada, on this bill.

I want to thank the parliamentary secretary for having had the elegance of thought to acknowledge that this bill was presented by the government of which I was a member and which saw another reincarnation as Bill C-58.

I think other members of both parties are probably equally thankful that the bill has seen its way not only through this House but also through committee. Witness, of course, the fact that report stage went through without comment and that we received, to all intents and purposes, the unanimous consent of all members of this House so that the bill could receive its third and final reading, be voted upon, be sent to the Senate, and be proclaimed.

Why would something like that happen? All members of Parliament have a special interest in ensuring that there is a rebalancing of the relationship between the railway companies and the shippers, be they large or small. More than anything else, I think that members of Parliament, at least from my party, the Liberal Party, the official opposition, has always looked for a balance in the relationship between those who need a particular service and those who provide that service.

The parliamentary secretary used the words “to reintroduce balance”. I thank him for thinking in terms of what needed to be done, and that is to restructure the relationship that had started to develop in a counterproductive way between the railway companies and the shippers. He noted in establishing that interest of balance that all the shippers want this and he is probably right.

Those who came before committee, those who lobbied him, that lobbied me, and that lobbied the Bloc, all said exactly the same thing. They all said that it was time that the relationship that has evolved between them needs to have the Government of Canada, through the agency, establish a relationship that would regenerate the competitiveness of the shipping industry and all those who buy our products.

What he really meant, I guess, is that without this bill we could see the competitiveness of many of our producing companies and those industries, be they agricultural, lumber, or mining, suffer at the hands of the negative impacts of the monopoly behaviour that had been established by the two monopolies in the railway industry that essentially put the shippers at their mercy.

It was not always this way. Obviously, there have been difficulties between the supplier of the service, the railway companies, and the shippers who need that service in order to get their product to the emerging markets that require Canadian produce and commodities.

What has happened over the passage of time is that the railways, as the parliamentary secretary has indicated, have established their position of predominance over the shippers that they serve. What is the result?

First of all, there has been an inconsistency in the predictability of the service required by the shippers, so that they in turn can provide for their own marketplace, a guarantee that their product will be delivered on time as prescribed by the contractual arrangement between the buyer of that commodity, usually abroad in the Pacific emerging markets, or even in the United States.

Second, that the price that was agreed to initially would suffer as a result of the delay, the ancillary services, and the other penalties that occur as a result of the railways not providing, as agreed, the kinds of services that had been contracted.

We have heard many stories in committee, many anecdotes, that have angered the shippers and, in turn, the small producers that feed into the shipping companies. As I say, whether they are farmers or lumber companies, all of them have faced great difficulties. They could not guarantee a price because they could not guarantee a time of delivery to the markets that they wanted to penetrate or they had in fact already developed.

The kind of relationship that the railways had established and imposed, in fact, upon the very people they purported to serve, proposed to serve and for whom they had made investments to serve had turned out to be counterproductive. It is counterproductive from a Canadian point of view, from a macro Canadian interest point of view, from the point of view of a Canadian economy that needs to grow and provide assurances for all of its markets that it is capable of producing a timely product with timely delivery, and a price that is competitive worldwide.

They have been unable to do that and so the parliamentary secretary calls this the shippers bill. It is more important than that. It is not just a bill that is important for shippers. It is important for the competitiveness of the Canadian economy.

As a result, we see that there are provisions in this bill to ensure that the monopolistic behaviour of the railway companies is moderated to the point that it is capable of delivery and what Canadians, through them, must have. They must have a guarantee of service at a predetermined price and in a timely fashion that will allow for a revenue stream to come back to the shippers and producers, so that they can then access the financing they, in turn, require in order to make investments in the production of said products.

It does not take much in terms of rocket science to appreciate that the bill is not a shippers bill. It is a bill for you, Mr. Speaker, it is a bill for all of us to ensure that which produces great wealth for Canada, that contributes to the positive side of the ledger in international trade is guaranteed.

We cannot put in jeopardy either our producers or shippers, the very people, the very production systems, the very industries that ensure that we will be able to generate wealth. We cannot put them in a precarious position and at the mercy of those who deliver their product from point A to point B.

That is absolutely crucial because now we are entering into the area of the viability of Canada's infrastructure. Given the great distances between not only our people but the source of those products and commodities and the markets, we need to be able to have an infrastructure that is reliable.

That does not mean simply having a road that is paved. It does not simply mean having a railway track that functions without incidents or accidents on as frequent a basis as we have seen. No, it means that we need to have that type of infrastructure function in an efficient and economic fashion that continues to regenerate the business which makes its existence mandatory.

What do we do with a bill like this one? As I said earlier, it received the support of all members of Parliament in committee and, I dare say, will receive the support of all members of Parliament in the House, unless, of course, some in the NDP decide that they want to filibuster.

They will receive the support of Canadians everywhere because, in effect, what will transpire is a new infrastructure of legislation to govern the mandates given to the railway companies and to the shippers as stewards of Canada's natural resource wealth, a wealth that needs to be materialized, realized and brought to fruition in foreign markets, so that Canadians can say, yes, this wealth will be distributed for the good of all citizens, one and all.

Mr. Speaker, the bill, as you already noted at second reading, was examined by members of the committee on your behalf very thoroughly, and I might add that, subsequent to the debate such as it was, there was no need to amend the bill.

Imagine, no need to amend the bill that saw its genesis in 2005 with the then Liberal administration, saw its regeneration again as Bill C-58 last May, and is now again before the House as Bill C-8 with not a change, not a comma, not a semicolon, not a capital at the beginning of a sentence, nothing.

Why? Because it has been a bill that has been thoroughly researched. The consultation has taken place with all of the stakeholders and even the railways have not objected as strenuously as one might expect from those who are compelled to do something with which they are, at least in the recent past, not familiar and that is equitable behaviour. But they see the wisdom of the legislation.

We will see that certain mechanisms in this bill, those clauses that ensure the balance is regenerated back between the shippers and the railway companies, are at the core of everything. When things are balanced out, everyone realizes that fairness is the basis for any relationship that develops as a result. What is fair? What is fair, of course, is that shippers contract to have their product taken from point A to a port where the railway companies will deliver the cars required or that product to be picked up at a time contracted so that everybody's expenses are diminished. That is fair.

Therefore, this bill says we are not going to dictate at which time, which day and under what circumstances said number of cars are going to be delivered, but if shippers contract to deliver said number of cars on said day at such and such a time, then railways must deliver and if they do not, there are commercial consequences in the appropriate court.

One might say, well one might say we would go to court anyway. Well, no, not when David is facing Goliath. The government has accepted the will of Parliament and we have decided no more David and Goliath relationship. We are going to ensure that the shippers are adequately protected in this unbalanced relationship.

If there is a price agreed, there shall be no changes to those prices unless companies have given at least a 30 day notice of same. We have seen this: prices subject to change without notice. That is good for those who benefit from that, but it is not good for those who project their business plan on the basis of a guaranteed price down the road. The railways have to give at least a 30 day notice that prices are going to be changed while still delivering the service which they have contracted to deliver.

It sound fair. The parliamentary secretary says that it is reintroducing balance. That is a backhanded way of saying the other guys have been taking an unfair advantage of a situation. Is that being critical? It should be. What else does it say?

My colleagues from the Bloc will recall that we had some discussion about ancillary services. What are they? In one instance, the railroad said that it had six points to consider. Another one, a shipper, pointed out that there are something like 30 to 60 items that are added on to a price.

One of our colleagues on committee said that it sounded a little bit like going in to buy a car, but after we have contracted the price the dealer says, by the way, if we want a motor it costs this much more, and if we want tires on every wheel, it costs this much more and so on. By the time we are finished, we might well be paying twice as much for the car as what we initially contracted.

Therefore, there is transparency of cost. There is transparency of the final price for the product that is being delivered, not necessarily by the shippers, because they already have to do that with their producers and the people over at the ports where they are going to deliver the material. It is something that the railways must be able to guarantee their shippers.

I think the minister agrees, because he put that into the bill. However, we need to make sure people understand that this is what balancing the relationship between railways and shippers is really all about. It is ensuring that no one takes undue advantage of a relationship of power that has developed over time.

As I said, the ultimate beneficiaries of course will be the Canadian public and the Canadian marketplace. If nothing else, it will mean that producers will get their product to market at a time when the market thinks it is appropriate to receive it.

It was not that long ago that in another capacity I was dealing with business people from China. We talked about buying Canadian product,and in particular, agricultural product. Their complaint was not so much that the Canadian product was not of exceptional quality. They really do enjoy Canadian quality. It was not so much that the price was not right, because of course it was.

However, they said, “What is the use of us buying good quality at the right price if we cannot get it to our market?” If our railways cannot deliver their product to the port of Vancouver or Prince Rupert in a timely fashion, what is the purpose of them putting their ships out off the port, wasting time, costing them money and redoubling the expectation of the price they needed to pay in the first place?

Under those circumstances, it does not do them any good to buy Canadian product. They might as well look for it some place else, they said, not because the product is not any good, not because it does not get delivered to port, but because it does not get delivered when they need it.

Therefore, if there is one criticism about all this, it is not that the bill itself will not be capable of delivering what it purports to deliver, but it highlights the importance of having an infrastructure program that includes this relationship as well as the physical infrastructure that must be put in place and which guarantees that the fruition we expect from this bill will be brought to bear and materialize down the road.

Whether it is in the Pacific gateway, as we have come to know the development of an infrastructure for delivery outside of Canadian borders out west, whether it is an Atlantic gateway, in the event that we have minerals and other products that need to go through the Great Lakes and out through the Maritimes, or whether it is in fact the gateway at the central part of the continent through Ontario, Quebec and the Great Lakes, we need to have an extension of the bill and the principles which it tries to address through the physical infrastructure that can only result in the continued growth of the Canadian economy.

As I said earlier, the bill does not punish anybody. The bill is designed to bring parties together so that the wealth of Canada, which contributes to the positive side of the foreign relations ledger in foreign trade, is an opportunity to be realized to its maximum.

I know that all members of this party, the official opposition, will vote in support of this bill at third reading for all of those principles that I have so humbly put forward. I know that the government is going to be supportive of this. I think even my good colleagues from the Bloc are going to be delighted to support it. All other good members may, but I urge all Canadians to get behind this bill.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Mr. Speaker, this is the very crux of the issue itself and of Bill C-8.

There is group final offer arbitration, which was asked for by many groups that are shippers. If the member wants more personal information for his own constituents, I will be more than happy to meet with him and provide that.

However, that is exactly what the crux of the bill is. It is to help shippers. It is to help with what we call a duopoloy situation or a duomonopoly situation, where the railways have in some instances had excessive fees, or similar types of complaints from farmers or other shippers across the country. The bill is speaks exactly to that.

[Roy Cullen, Liberal, Etobicoke North, ON]

Mr. Speaker, I am sorry I was at a committee and came here the middle of the parliamentary secretary's presentation on Bill C-8,

I do not know if he covered this, but one of the things we hear from the forest industry and other big shippers is they feel they are often left with no alternative other than to deal with CN.

I know in my experience in the forest industry, many of our mills and the company I worked for did not have any options. It was CN and that was it. Therefore, the shippers feel that in some cases they are gouged in terms of the rates.

Is there something in Bill C-8 that deals with this issue, something like final offer arbitration or some way of arbitrating these differences where CN has a monopoly position and there are no reasonable alternatives?

[Brian Jean, Conservative, Parliamentary Secretary to the Minister of Transport]

Mr. Speaker, Bill C-8 is the third and final bill amending the Canada Transportation Act. Two previous bills, one on international bridges and tunnels and other provisions of the act, were passed in the previous session.

The Canada Transportation Act is the legislative framework that, among other things, regulates the economic activities of the railways, in particular services and rates. While the act generally relies on market forces, there are a number of shipper protection provisions to address the potential abuse of market power by the railways.

I remind all members that Bill C-8 is extremely important to shippers. I am sure that many of us in the House today have heard how important the bill is.

Many members have undoubtedly heard many complaints from coast to coast about railway service and rates over the last few years. Bill C-8 strengthens the shippers' provisions in the act. By doing so, it improves shippers' leverage when they negotiate with railways, which contribute to better service and lower rates.

Bill C-8 is great news for Canada. Over time it is hoped that this will also improve the relationships between shippers and railways.

I also wish to remind members that Bill C-8 is the result of extensive consultations, dating back to the statutory review of the Canada Transportation Act that took place in 2000-01. This provided an opportunity for shippers to develop a very strong consensus in support of the bill. In fact, a couple of the members of the Standing Committee on Transport, Infrastructure and Communities, on which I sit, commented on how unique it was to see such a strong, solid consensus from an industry sector such as the shippers in this case.

I ask members to keep this in mind during third reading debate. Shippers like the bill. They want it to be passed as soon as possible. Let us not disappoint them.

The bill is also important to railways and their investors because it gives them certainty. It gives them regulatory stability and they know this. Providing regulatory stability will improve the investment climate and facilitate investments by the railways and their networks, equipment and crews so they can maintain and even expand their operations.

Canada is a trading nation and railways are important to our future growth in our economy. This in turn will help shippers compete in domestic, continental and international markets. It will also facilitate the achievement of government objectives to improve the transportation gateways in corridors in western, central and eastern Canada.

What the government is doing is making this an even stronger trading nation, ensuring we have all the inventory and assets necessary to become that strong nation.

When asked at committee stage whether Bill C-8 would cause the railways to cancel any investment plans, Mr. Cliff Mackay, president of the Railway Association of Canada, replied:

The short answer is no, we will invest. We need to invest. It's part of our business. It's very important.

I believe Bill C-8 re-balances the regulatory framework in an appropriate manner. Shippers are clearly looking forward to the new provisions. At the same time, however, there should not be a significant impact on railway investments. The bill is necessary for our future, and the government is going to pass it.

During the consultative process in the summer of 2006, the minister encouraged the railways to look at potential commercial solutions to address the concerns of shippers. The intention was that improved commercial mechanisms would complement amendments to the shipper provisions.

The railways discussed a commercial dispute resolution proposal with shippers. For some period of time, we heard at committee that they discussed this. Good progress was made, but discussions eventually broke down as both sides could not find a solution that was satisfactory to both sides.

The government is hopeful that the discussions will resume once the bill is passed and sets a framework for those. An effective commercial dispute resolution process is preferable to regulated remedies. A commercial approach would be more expeditious, less costly and less confrontational and better for long term relations.

I will briefly discuss the main provisions in the bill that have been endorsed by the committee.

Under the existing section 27 of the act, the agency must be satisfied that a shipper would suffer “substantial commercial harm” before granting a remedy.

Shippers have long objected to this test. As members can imagine, it can be quite onerous. The railways argue that this test is consistent with the commercial approach reflected throughout the act and have pointed out that based on agency decisions to date, the provision has not prevented shippers from accessing remedies. The government concurs with shippers that the substantial harm test is not required.

It is a serious matter for a shipper to seek a remedy under the Canada Transportation Act.

First, it can have an adverse impact on a shipper's relationship with a carrier. Many shippers across the country only have one carrier, one railroad to deal with, and this relationship is very important to them.

Second, pursuing a regulatory remedy can often be extremely expensive. For small farmers, independent operators, it is almost impossible in some instances to afford or even to launch such a discussion.

The test itself is unwarranted and is being dropped under Bill C-8, great news for shippers.

The bill also contains a new provision that would allow shippers to complain to the agency if they were not satisfied with railway charges or the conditions associated with such charges, other than freight rates. The principal remedy for freight rates will continue to be final offer arbitration. The charges I refer to include what are often referred to as ancillary charges such as fees levied for cleaning or storing cars.

The new provision would also deal with such charges as well as some other charges related to the movement of traffic, such as demurrage. Demurrage is a payment incurred when a shipper takes too long to unload or load a car. Sometimes these circumstances happen as a result of something beyond their control.

The agency will have the authority to review complaints about such charges and to order a railway to revise the charge or so stated conditions if the agency finds them to be unreasonable. These charges have become an issue with shippers over the past few years and shippers are very pleased that the Conservative government has introduced an effective measure to address them.

The last major element of Bill C-8 is the introduction of group final offer arbitration, commonly referred to as group FOA. The existing final offer arbitration provision is one of the more popular remedies with shippers. A shipper can apply for final offer arbitration if the shipper is not satisfied with the railway's freight rates or associated conditions.

Under the process, the shipper and railway each submit their final offer to the arbitrator. The arbitrator must select either one or the other and is not allowed to change or modify either of the final offers. Imagine what that would lead to. It encourages the two parties to be fair and reasonable, which is most important, or else they lose the arbitration itself. The process often leads to a negotiated settlement and that would be good news as well.

Bill C-8 would allow a group of shippers to apply for final offer arbitration subject to three main conditions.

First, the agency must be satisfied that the group attempted to mediate the matter with the railway first. This is to encourage a commercial solution if at all possible, and would be in the best interests of the Canadian shipping industry.

Second, in addition, the matter must be common to all the shippers.

Third, they must make a joint offer, the terms of which apply to all of them.

The concept of commonality in terms of both the matter and the offer is essential to group final offer arbitration. Otherwise it simply would not work and we would all be wasting our time. In this case it will be and it is again great news for shippers around the country.

The former Bill C-58, which was reinstated as Bill C-8, was tabled on May 30 of this year. At that time, the minister announced there would be a review of railway service. This would commence within 30 days after the bill itself has passed.

It is important to note that shippers strongly endorse the proposed review and look forward to it. The review will focus on solutions to railway service issues, including commercial solutions. Transport Canada officials have had some preliminary discussions with shippers on the terms of reference for this study. More consultations will take place before recommendations are submitted to the minister and before any final decision is made, again, great news for Canadians.

There is a widespread support for Bill CC-8 among all political parties. As I mentioned, the former Bill C-58 was tabled in the House on May 30 of this year. Second reading debate was concluded in one day, on June 14. It moved very quickly, with all party support for the most part of all clauses of the bill, before the session was prorogued.

The Standing Committee on Transport, Infrastructure and Communities heard witnesses at three meetings last month. The witnesses included the minister, the railways and the shippers. We have heard from stakeholders.

The committee heard a clear desire for the bill to be passed expeditiously without amendments. I have seen many emails and have had many phone calls from shippers across the country. They want the bill passed as quickly as possible.

The standing committee was able to conclude clause-by-clause review in less than 30 minutes. The committee approved one technical amendment to clarify that the new power being given to the agency to address complaints about railway charges would not apply to freight rates. In essence, it was simply an amendment to ensure and to clarify that we would have less litigation.

The bill is extremely important to shippers from coast to coast to coast from all types of industry. They have been waiting for results since 2001. The statutory review of the act was completed in 2001.

The bill would also provide regulatory stability sought by the railways. This is good news for Canadians because we are a trading nation. The economy of Canadians is tightly woven with the success of our shipping from coast to coast.

The standing committee dealt with the bill very quickly. I want to personally thank all members of the standing committee for their efficient review of the bill.

I now urge the House and all members to get behind the bill and to pass it as quickly as possible so Canadian shippers and manufacturers can rely on the great work of the House.

The House proceeded to the consideration of Bill C-8, An Act to amend the Canada Transportation Act (railway transportation), as reported (with amendment) from the committee.

Business of the House

[Peter Van Loan, Conservative, Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, 2007 has been a great year for Canada and a great year for the House of Commons.

Next week is the last week of the fall sitting and the last week before the new year. The sitting and the year have been extremely successful for the federal government, as we have introduced legislation in all of our priority areas and have delivered results for Canadians.

However, since we have only a few sitting days remaining this year to address important tax cuts, security issues and other priority bills still pending, Canadians are expecting us to work very hard in the coming days to produce results for them.

We want to see our priority bills passed in this House and sent to the Senate so that they may become law before Christmas. As a result, next week will be 2007, a year of results week.

We plan to build on our past achievements by debating and passing the budget implementation bill, which would lower taxes for all Canadians by reducing the GST to 5%, as well as by bringing in tax cuts for individuals and corporations.

We will debate Bill S-2, An Act to amend the Canada-United States Tax Convention Act, 1984, which must be passed by Parliament before January 1 to ensure that it is implemented and we can benefit from that.

We will also debate our railway transportation bill, Bill C-8, and our bill on the settlement of international investment disputes, Bill C-9. Both bills will help create jobs and provide economic certainty for Canadians.

Our government will continue to show Canadians that we are serious about tackling crime and strengthening the security of Canadians. Next week, we expect that our security certificates bill, Bill C-3, will be reported back from committee. The bill will then be debated at report stage and third reading. We hope the hon. members of the House understand the importance of passing this legislation so that it may be considered and passed by the Senate before the deadline imposed by the Supreme Court.

We will debate any amendments made to our Bill C-13 on criminal procedure, currently being examined by the Senate.

Speaking of the Senate, the government hopes that the tackling violent crime act will pass the Senate so Canadians can feel safer over the Christmas holidays knowing that the bill has been enacted into law.

Canadians also expect their institutions to be more accountable and democratic. We have built a record of results on this file as well, with the passage of the Federal Accountability Act and Bill C-31 to improve the integrity of the voting process. Next week we will continue with our plans in this area by debating Bill C-29, which closes a loophole in our campaign financing laws that Liberal leadership candidates used to bypass campaign contribution limits last year.

We would also like Bill C-6, on the visual identification of voters, and Bill C-18, on the verification of residence, to be sent back by committee. It is important for these bills to become law, so that they can be implemented in time for the next byelections.

Tomorrow I will also seek consent to send Bill C-30, the specific land claims bill, to committee. This bill to create certainty and allow land claims to be resolved more quickly is a welcome addition and the country will be better off the sooner its process is put in place.

This year, 2007, has been an excellent year for Canada. Our economy is booming, the country is united and there is integrity in government.

We have achieved a lot this year. Our government has delivered real results for Canadians in 2007 and will continue to do so next week and in the new year.

Transport, Infrastructure and Communities

[Merv Tweed, Conservative, Brandon—Souris, MB]

Mr. Speaker, I have the honour to present, in both official languages, the first report of the Standing Committee on Transport, Infrastructure and Communities.

In accordance with its order of reference on Monday, October 29, your committee has considered Bill C-8, An Act to amend the Canada Transportation Act (railway transportation), and agreed, on Tuesday, December 4, to report it with an amendment.

Canada Marine Act

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, when debate adjourned last night, I understood I had three minutes. This is wonderful news. It is one more minute for a politician to talk.

When I left off debate, I was talking about the opportunities that Canada has in the area of international trade. As we know, Canada is a trading nation. It is one of the most successful trading nations in the world. In fact, it is perhaps the most resource rich country in the world. The nations of the world are beating a path to our doorstep not only for our resources and commodities but they are also looking to us for the technological expertise and much of the information we can deliver to make the world a better place.

When I left off debate, I was raising a number of reasons why we face challenges in Canada in trying to maximize the benefits we get from international trade. The first of these reasons was the awful truth that previous federal governments had essentially abandoned any significant effort to build our national infrastructure and the result was an aging infrastructure that was ill-suited to compete with the demands of the 21st century.

That is why the Conservative government, of course, introduced a $33 billion building Canada fund, which is a plan that is going to rebuild and renew our national infrastructure. It is the largest investment of its kind certainly in the last 50 years, if perhaps not in Canadian history. The building Canada fund is going to be rolled out over the next seven years.

There is a second reason why we have challenges in the area of making sure that we compete internationally for trade. That was the fact that the level of service in transportation, specifically railway transportation, was in a critical state of affairs. For many years virtually everyone in the shipping industry had complained about the fact that the level and quality of service delivered by our large national railways had declined.

To address this concern, our government introduced Bill C-8, which goes a long way to improving the level of service in our national railways. It ensures that the dispute resolution mechanisms available for shippers are efficient, low cost and timely.

The third reason why Canada is beginning to have challenges in the area of its gateways and trade corridors is the fact that our country does not have the legal flexibility given to its ports to be able to adapt to a rapidly changing economic environment. When I talk about ports, I am talking about marine ports, such as the port of Vancouver, the port of Montreal, the port of Halifax.

There are numerous other inland and marine ports across Canada that have challenges. They have transportation pinch points that restrict the ability of those who carry on trade with Canada and within Canada to get the job done. That is why we have introduced Bill C-23. It provides much more flexibility to the ports to be able to adapt to changing environments.

One of the areas where we are providing more flexibility is, for example, in the area of land management. Ports will now have more powers and authority to manage their lands, to lease them, to sell them, and to use them for the purposes they deem necessary for their businesses. We have also expanded the whole area of legal authority and the ability to borrow money, which again had been severely constrained until now.

We believe this flexibility is going to allow our ports to become even more dynamic because if we do not become more dynamic in the area of trade and ensure the infrastructure in Canada is in place to adapt to increasing trade, we are going to lose out.

There are many other ports across North America now that are competing with us and they are very aggressive. We need to make sure that our ports in Canada have the ability to meet the challenges of the 21st century.

I am thankful for the opportunity to address this very important issue for Canadians.

[The Chair (Mr. Mervin Tweed (Brandon—Souris, CPC)), Conservative, Merv Tweed]

Good morning, everyone. Welcome to the Standing Committee on Transport, Infrastructure and Communities, meeting 5.

Pursuant to the order of reference of Monday, October 29, 2007, we are continuing with Bill C-8, an act to amend the Canada Transportation Act on railway transportation.

Joining us today we have Helena Borges, director general, surface transportation policy, and Alain Langlois, legal counsel.

As previously agreed upon, we're going to move forward with the clause-by-clause. I believe that currently there are two amendments that are out there, so I hope everybody has those in front of them.

Barring any questions or any concerns, I think we'll proceed.

(Clauses 1 and 2 agreed to)

(On clause 3)

[Marta Morgan]

In the legislation as it currently stands, there is one option that works very well for shippers when they have a problem with base freight rates and that is final offer arbitration. Under the current act, that is the only method that has proven effective for us, but it is very costly. It can cost a million dollars per case. So there must be a major problem with base freight rates for us to turn to final offer arbitration.

What we are seeking through Bill C-8 is to cover other aspects that have arisen, incidental tariffs and service, because for these two services and the related tariffs, shippers have no recourse when a problem arises. That is the fundamental problem. The companies have the option of offering these services, setting the prices they want, but the shippers, on their side, have no power, because they must absolutely use CN or CP. So the power always remains in the hands of the railway companies. So there is an imbalance. There is a slight imbalance in the base freight rates, because at least we have final offer arbitration, but as regards the other aspects, there is no balance in the legislation as it currently stands.

[Robert Ballantyne, Chairman, Canadian Industrial Transportation Association, Coalition of Rail Shippers]

Thank you very much, Mr. Chairman. We'll be a lot less than ten minutes with the opening remarks.

Again, we do appreciate the opportunity to appear before the standing committee to discuss Bill C-8.

The Coalition of Rail Shippers is comprised of 17 industry associations, and I would like to read who they are. They comprise the Animal Nutrition Association of Canada; the Canadian Canola Growers Association; the Canadian Dehydrators Association, those are the alfalfa producers; the Canadian Wheat Board; the Forest Products Association of Canada; the Grain Growers of Canada; Inland Terminal Association of Canada; Pulse Canada; the Canadian Chemical Producers' Association; the Canadian Fertilizer Institute; the Canadian Industrial Transportation Association; the Mining Association of Canada; the Propane Gas Association of Canada; the Western Canadian Shippers’ Coalition, which also has in their membership the Alberta Forest Products Shippers Association and the Canadian Oilseed Processors Association; the Western Canadian Wheat Growers Association; and the Western Grain Elevator Association.

This coalition, as you can see, is very broad, and the member companies of the associations represented in the coalition account for at least 80% of CN and CP's revenues.

The group represents widely varying industries, as you can tell, including agriculture, primary industries, resource processors, manufacturers, and retailers from all parts of the country.

The three witnesses represent all members of the coalition and we will be able to give a variety of perspectives in answer to your questions.

I won't reintroduce my two colleagues, as you did introduce them, Mr. Chairman.

The fundamental problem with railway freight is that the market does not work in a normal competitive manner, and the bargaining power between the CN-CPR dual monopoly and rail shippers is tilted very much in favour of the railways. Bill C-8 and the announced service review begin to redress this imbalance.

This bill has come out of a long process of discussions, negotiations, and ultimately a decision by the minister and his staff to move forward.

Shippers represented by the CRS group are in many different businesses, but at the end of the process this was a package that could address everyone's most significant concerns. This bill is an excellent starting point to achieving balance between shippers and railways, and as such, the members of CRS support the passage of Bill C-8 , as written, as soon as possible.

An important part of the package is the announcement that the government will undertake an independent review of railway service within 30 days of the passage of the bill. The CRS group strongly supports this initiative that will address service problems faced by shippers in industries across the country. The amendments in Bill C-8 will facilitate a climate that will promote more normal commercial dialogue between buyers and sellers in the rail freight market.

We will not repeat the comments made in our submission to this committee. I will just finish by saying that the CRS group urges rapid passage of this important piece of legislation, as written.

We would be pleased to answer any questions the members may have.

Thank you, Mr. Chairman.

[The Chair (Mr. Mervin Tweed (Brandon—Souris, CPC)), Conservative, Merv Tweed]

Good morning, everyone, and welcome to the Standing Committee on Transport, Infrastructure and Communities.

This is meeting number four, pursuant to the order of reference of Monday, October 29, 2007, on Bill C-8, an act to amend the Canada Transportation Act on railway transportation.

Joining us today, from the Coalition of Rail Shippers, is Mr. Robert Ballantyne, who is chairman of the Canadian Industrial Transportation Association; Mr. Wade Sobkowich, executive director of the Western Grain Elevator Association; and Marta Morgan, vice-president, trade and competitiveness, Forest Products Association of Canada.

We welcome you to the committee.

As in previous meetings, we'll ask you to make your presentation of ten minutes and then we'll have questions and answers from the committee members.

I would ask Mr. Ballantyne to please begin.