Industry Committee on June 3rd, 2010

[Alan Johnston]

We have it on YouTube as well.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Excellent. I'll send a link to Mr. Masse.

[Alan Johnston]

I was going to see him privately after and give it to him.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

I wanted to begin by asking initially about the certified technicians who measure the accuracy of the pumps. Who certifies the technicians?

[Alan Johnston]

Measurement Canada certifies the technicians.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

And how does that process work?

[Alan Johnston]

I'll turn this over to Sonia. Sonia's responsible for this, so I'm going to give her the floor.

[Sonia Roussy]

The process is one whereby the technicians must receive training from Measurement Canada. Training depends on the device types that they will be inspecting. Typically we're talking four to five days in length for each device type.

Following the training they must successfully complete a theoretical evaluation, receiving a 75% mark or higher. They must then do an on-site practical evaluation, where they actually go through the process and we observe what they do. Again, they must successfully complete that at 70% or higher.

They must acquire equipment that is calibrated and meets all the specifications from Measurement Canada, the test equipment, and they must document and use procedures that have been approved by Measurement Canada as well. So that's the qualification process.

Once they are out doing the work, then they are monitored. We do—minimum—annual surveillance of them, of all the technicians. These could involve audits. We follow up on their work because they are required to submit the results of all their work to us. So when they arrive at a device they must document what the as-found results are--when they got there, what was the condition of the device, what work they did, and then what was the condition when they left.

All of that is submitted to Measurement Canada, and we enter it into a database. This permits us to look up where they have been, and we can show up on a surprise visit and do a follow-up of the technician. If anything inadequate is found during that follow-up, then we immediately raise a non-conformance. If it's a more serious non-conformance, we can immediately suspend the technician or even revoke if it's very serious, where there's a case where we determine there was fraud of some kind. If they're revoked, they will not be able to do business in that front any more. If they are suspended, they would have to put in place all of the corrective and preventive actions so that we could be assured that their suspension could be lifted.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you. It sounds like a very rigorous process.

On the certified technicians, I'm just curious: other than measuring the accuracy of pumps for the companies they work for, what other services are they providing to retail gas stations, and how frequently are they visiting and providing those services?

[Sonia Roussy]

It will depend on the company, on the authorized service provider. There are some authorized service providers who do only inspections. Some of them will offer repair services. They will do maintenance work on the equipment. It really depends on the business. The majority of the companies have been in business for a long time doing repair services for the industry, depending on what industry we're talking about. So for scale companies and meter companies, their livelihood comes from doing repair work and inspection work once they become authorized service providers.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Very good. I have a question about the AMPs, the administrative monetary penalties. This is a new feature under Bill C-14. Is that correct?

[Alan Johnston]

That's correct.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

It doesn't currently exist.

Could you provide a little background on the rationale for the creation of this mechanism, why you believe it will be effective, why the penalties will be set at the levels they'll be set at? Will the technicians have the authority to impose the penalty right then and there on the spot? How will those penalties be used? Will they go into general revenue? Where will the money collected through the penalty process go?

[Alan Johnston]

First of all, only Measurement Canada inspectors can take enforcement action, so the recognized technicians will be doing inspections; they will not be taking any enforcement action. As for where the money goes, any money that is collected through the AMPs will go to the consolidated revenue fund. Measurement Canada is 100% appropriated, so we would not keep any of this revenue.

There are a number of reasons we think AMPs will be more effective than prosecution. For one thing, prosecution is a long process. As I said earlier, I think sometimes the penalty doesn't fit the crime, so to speak. They can have a criminal record, which wouldn't allow them to travel. We think that it's also a very lengthy process to go through the courts. The use of AMPs would allow us to correct and identify those problems right away. We think we would get—I'll call them “retailers” for lack of a better way of putting it—their attention right away. It would be more effective in terms of overall compliance in the marketplace.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Braid. Thank you, Mr. Johnston.

Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Let me make sure this is correct. The retailer will be the one getting the bill for this new inspection in terms of the gas pump or diesel pump.

[Alan Johnston]

That's correct.

[Brian Masse, NDP, Windsor West, ON]

I think this is one of the reasons it seems unfair. You look at the oil and gas companies right now. They're enjoying windfall profits. They're obliterating the earth—and BP is an example. They're getting windfall tax cuts. Then the $50 to $200 fee is going to be passed on to consumers, along with the HST, who will basically get what they pay for as a free market decision to buy that actual product. That hardly seems fair.

[Alan Johnston]

I can't comment on a lot of that. The device owner under the Weights and Measures Act is responsible for maintaining the device in an accurate state. Therefore if we levy a charge or the recognized technician levies a charge, it would go to the device owner, and that may be the retailer or it may be the oil company.

[Brian Masse, NDP, Windsor West, ON]

So is there going to be a greater disparity in terms of the $50 to $200 cost? Is that going to be higher because, for example, if you're a rural retailer it could cost a lot more money to have somebody drive sometimes hundreds of kilometres out to a location? We looked at some of the stats here in terms of the number of inspectors. There are zero on Prince Edward Island, for example. So if somebody has to come from the mainland shore to Prince Edward Island to inspect the pump, what would the cost of that be versus what it would be for someone in downtown Toronto?

[Alan Johnston]

First of all, we have a number of recognized technicians or authorized service providers who are in rural areas. We have them in Thunder Bay. We have them in the Saguenay. We expect that, as Ms. Roussy said earlier, there's no real incentive for these companies to get into the business right now because there are no mandatory re-inspection periods.

We're anticipating a growth. We're anticipating that a lot of these companies that are now getting their devices serviced by somebody will pick up to do those inspections at the same time. There could be a cost because more travel will be involved, but we would anticipate that these private companies would be able to engage a number or become the service provider to a number of companies in a local area. So instead of travelling up and back once a week, they could be up there for a week, and that would spread out those costs. If in fact they couldn't get the work done, then Measurement Canada would have an obligation to get that work done.

[Brian Masse, NDP, Windsor West, ON]

How much competition is there in the industry of actually inspecting pumps? In terms of a region, how much competition is there? Are there several companies you could select from?

[Alan Johnston]

Yes.

[Brian Masse, NDP, Windsor West, ON]

Okay, so despite the fact that there are a few hundred of them among yourselves, publicly owned, and privately licensed, they're competing. Even if there are five in Saskatchewan, for example, they're competing against each other on a regular basis for the entire province of Saskatchewan?

[Alan Johnston]

Yes.