Transport Committee on Nov. 21st, 2006

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

I'd support this amendment. It provides an effective balance for what is clearly enunciated here.

It's been a problem. We've now talked about it on a couple of amendments. We have a problem between basically giving no play to the public sector and talking about competition and market forces as being the only route to take.

There is the rare exception and a very strict definition that would be the only exception in terms of public transportation. I refer back to the national transportation policy, which we are in effect amending. It talks about “competition and market forces...whenever possible”. It talks about the economic regulation of carriers and modes of transportation occurring in services and regions. It talks about transportation being recognized as a key to regional economic development.

Mr. Bell's amendment talks to what is already in the national transportation policy. It does add the element of the environment, which is something. It is fair to say almost all Canadians would welcome this committee's adding it in as an element that has to be taken into consideration for policy purposes.

The amendment is very helpful. It talks about economic outcomes, as the current policy does. It talks about social outcomes, which the current policy does. It doesn't use the exact same words, but it is clearly referenced in the current transportation policy. It then adds an environmental component that we already adopted when we adopted the initial amendments from Monsieur Laframboise. It is very consistent with what we have put in place so far in this clause-by-clause analysis.

If we don't put it in, we end up with a contradiction between a policy enunciation that talks about the environment and the role transportation plays and the current clause that says public intervention only occurs in a very strict and limited type of situation.

I don't think it's where most Canadians are at. I certainly don't think it's where Canadians would want us to go. I think this amendment is very helpful.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Monsieur Laframboise.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Ms. Borges, I am going back to what you said.

In my opinion, it’s the opposite, that is, it does not change anything in clause 5(a) where it still states that “market forces [. . .] are the prime agents [. . .].”

Except that by using the words “only if they are necessary” in clause 5(b), it’s as if market forces were the only agents, which is not what we want.

Market forces are the prime agent but, with Mr. Bell’s amendment, the other directions we want to give are also important. I think that is what we are delivering. If we were to support Mr. Bell’s motion, it would mean there are not only market forces. In fact, the way your clause 5(b) is drafted, as you tabled it, it can be read: “only if they are necessary.” It’s as if market forces were the only conditions while, in our case, we are saying to the industry that market forces are not the only conditions; the environmental issues, safety and security also have to be taken into consideration. In clause 5(b), we still keep the same text, stating that if the outcomes “cannot be achieved satisfactorily by . . . market forces [. . .]”. We keep those words but add greater importance to other agents than they had. I don’t think we eliminate the fact that market forces are the prime agent. That is why I do not recommend changing the proposed clause 5(a).

However, by adding the amendment from Mr. Bell and Mr. McGuinty, we give other conditions greater force, without eliminating the prime agents, which are market forces and competition.

[The Chair, Conservative, Merv Tweed]

Mr. Jean.

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

Thank you, Mr. Chair.

If I can be blunt, I think the wording and the word “directed” is very bad to use in this particular case. It also brings uncertainty to the marketplace from an economic perspective. As a business person looking at transportation modes.... It doesn't mean that through the great Conservative government's initiatives like transit passes, tax deductions, and other things, we can't encourage people to use public transit, fund it, and use competition. But I think it detracts from it. It creates some error and some amount of uncertainty in the marketplace in which we're trying to encourage people to invest to create more modes of transportation and better modes.

I don't know how the French translation comes out, but I'm very uncomfortable with the English and the word “directed”.

[The Chair, Conservative, Merv Tweed]

Mr. Fast.

[Ed Fast, Conservative, Abbotsford, BC]

I concur with Mr. Jean, because if you look at proposed paragraphs 5(a) and 5(b), they are two parts of the whole. You refer to the competition and market forces as being the prime agents. “Prime” implies that there's a secondary group involved here--not one more important than the other, but one taking the leading role--and the secondary one is addressed in proposed paragraph 5(b). If we agree to the amendment proposed, it really contradicts what we've done in proposed paragraph 5(a). You're basically establishing two even forces competing in the marketplace, and that's my concern.

I believe our drafters have worked very hard to make sure this is balanced. We have proposed paragraphs 5(a) and 5(b). Proposed paragraph 5(a) sets out the prime. Proposed paragraph 5(b) essentially sets out the secondary role government plays if proposed paragraph 5(a) doesn't fulfill the mandate we require for transportation.

I think that's the direction you're coming from. Is that correct?

[Helena Borges]

I have a little further elaboration. I would like to correct Mr. Julian, who said that “environmental” wasn't there. It's currently in the bill.

We have to remember that the bill was last updated in 1995 and came into force in 1996. If you look at what has happened in the transportation sector, we have had a devolution of the airports to private sector entities--no longer the government. We have had the same thing occur in ports and in Nav Canada. The majority of what used to be publicly delivered is now delivered by competition and market forces.

As you say, Mr. Fast, that is the prime agent. The government should need to step in only when that fails, and then to regulate or provide intervention that makes up for that failure or lack of ability of the private sector competition to deliver it. But it isn't the prime force.

We're also concerned that putting in the word “directed” really gives it a much stronger sense than what it is meant to convey right now.

[The Chair, Conservative, Merv Tweed]

Mr. McGuinty.

[David McGuinty, Liberal, Ottawa South, ON]

Perhaps I can respond to a few comments, Mr. Chairman.

First of all, I don't think it's about juxtaposing proposed paragraphs 5(a) and (b); it's about juxtaposing proposed paragraphs 5(a), (b), (c), (d), and (e). As we've heard from legal counsel, you cannot read any one of these in isolation. Taken as a whole, they are to speak to the balance that we're trying to achieve. These are the criteria, (a) through (e), that we're setting out to achieve the national policy. My general sense, from hearing and reading what was drafted in previous bills and what has arrived here for us to consider, is that there has been....

Ms. Borges pointed out--rightly, I think--the strong bent towards competition and market forces in the wake of deregulation, in the wake of CN's devolution, in the wake of airport authorities' devolution, and so on and so forth. I think the concern manifested by a number of us here is that proposed paragraph 5(b) might be the operative paragraph where we can strike a bit more balance. But in terms of (b), I'm more concerned, to be frank with you, about whether or not the federal government here is fettering and limiting unnecessarily its powers by talking about only regulating, only making strategic public interventions, when they're necessary.

When they're necessary for what? Well, as it says here, “to achieve economic, environmental or social outcomes that cannot be achieved satisfactorily by competition and market forces”. That would mean, for example, that if the federal government wanted to invest in light rail, say, in five major cities, it would have to somehow meet the test of it being necessary, because the market itself isn't providing enough funding or isn't supplying the transit systems we need for five major cities.

I don't know why, as drafters, it was necessary for you to fetter, in my view, the federal government's powers, to limit those powers, in the policy. This is one of the core criteria we're going to use to achieve the policy objective--I think that's what it says in English--and I'm just trying to understand why we have, in this operative passage, “only if they are necessary”. This is a new test that was not in the previous draft....

Am I mistaken? It was in the previous bill?

[Helena Borges]

Yes.

[David McGuinty, Liberal, Ottawa South, ON]

Exactly as worded? Okay. Then I stand corrected. But I think it would be a wonderful marriage of not only....

As I think we talked about, Mr. Chairmen, safety and security seem to be not the issue, but I think it would be important to clarify this question of “only if they are necessary”.

Maybe the word that people are getting hung up on is the word “directed”. I think that word should be used in its plain sense, not in the sense of receiving a direction; rather, to direct a regulatory approach and direct a strategic public intervention to achieve economic or environmental or safety, security, or other social outcomes.

I hope that clarifies.

[The Chair, Conservative, Merv Tweed]

Monsieur Laframboise.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Mr. Chair, I am astonished by the government’s reaction.

My question is addressed to the legislative clerk. If the amendment as such changes the nature of the bill, is that amendment admissible? Have you had the chance to analyse amendment LIB-0.1 tabled by the Liberals? If it changes the meaning of the bill, as far as I know, you can rule that part of the amendment inadmissible.

If you have not had time to analyse the new amendment and you want to take time to do so, that’s no problem. I do not want to change the nature of the bill and be told the amendment was inadmissible. If it is admissible, tell us.

[The Chair, Conservative, Merv Tweed]

I am advised that it is admissible.

Ms. Borges.

[Helena Borges]

Perhaps we can offer a compromise to Mr. McGuinty.

I get the sense that your concern, the way you're expressing it, is that we are limiting the government's ability to intervene, and that really it's because of the word “only”. If we remove the word “only” and say instead, “occur if they are necessary to achieve” these objectives, would that achieve your objectives? We think the constraint here is in the word “only”, but that's further to your explanation.

[David McGuinty, Liberal, Ottawa South, ON]

So you would take out the word.

[Helena Borges]

Yes. We would leave the rest as is and take out the word “only”, which is what's constraining it now.

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

Could you just translate into French what you proposed?

[Helena Borges]

The clause would read as follows:

b) la réglementation et les mesures publiques stratégiques sont utilisées si elles sont nécessaires [...]

It’s positive rather than negative.

[David McGuinty, Liberal, Ottawa South, ON]

Mr. Chairman, I don't think it meets my concern:

those objectives are most likely to be achieved when regulation and strategic public intervention occur, if they are necessary to achieve economic

Why don't we remove entirely the words “if they are necessary”?

[Helena Borges]

We believe “if it is necessary” is where the intervention should happen. I thought it was consistent with what you were putting forward, that the government intervenes where it is necessary to do so. We're not constraining ourselves in that way. But generally the government isn't going to intervene. We would prefer that market forces and competition continue to do that work.

[Alain Langlois]

As I mentioned earlier, I want to clarify one point. This is in the current national transportation policy statement, which is found in the current section 5 of the Canada Transportation Act, and “only if necessary” has not been interpreted as fettering the minister's discretion to regulation.

Quite the opposite, this section has been used to support the fact that when a section is enacted in the statute or any other statute to which this policy relates, it's a recognition or a statement by the government that the market has not prevailed and regulation has become necessary. So it's been used as an assistant to interpret the provision, that the intention behind the provision was to supply what the market forces were not able to supply. That's how this provision has been interpreted in the past.

[The Chair, Conservative, Merv Tweed]

Are there no other comments?

Mr. Jean.

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

I can't get past the word “directed”, which is the improper use of a term that absolutely could bind and cause some serious ramifications in the future. I would beseech Mr. McGuinty to find something more palatable in this situation. This is a declaration of the entire bill, which is one of the most important bills that we have before us.

Regarding the word “directed” and the wording there, I've read it 50 times, I practised law for 11 years, and I cannot get it in my head what you are trying to accomplish with this. I've heard you talk about it a few times, and I've asked for an interpretation, but it doesn't come through the mike.