Transport Committee on Feb. 12th, 2007

[The Chair, Conservative, Merv Tweed]

Good afternoon, everyone, and welcome to the Standing Committee on Transport, Infrastructure, and Communities, meeting 34.

Orders of the day: pursuant to the order of reference of Tuesday, November 7, 2006, we are studying Bill C-6, an act to amend the Aeronautics Act and to make consequential amendments to other acts.

Joining us today from the Department of Transport are Merlin Preuss, Franz Reinhardt, and Joan Knight. From the Department of National Defence we have Jacques Laplante, and Alex Weatherston.

As we have done in previous committees, we'll ask you to make your presentations. I'd ask you to limit them to no more than seven minutes, and then we will start the round of questioning from our committee members, if that's suitable. I would ask whoever is going to take the lead to please do so.

Thank you.

[Merlin Preuss, Director General, Civil Aviation, Department of Transport]

Thank you, Mr. Chairman.

Bon après-midi à tous. Good afternoon, everybody.

I am pleased to have the opportunity to appear before the Standing Committee on Transport, Infrastructure, and Communities for its study of Bill C-6, proposed legislation to amend the Aeronautics Act.

This act establishes the responsibility of the Minister of Transport for civil aeronautical activities and responsibility of the Minister of National Defence for military aeronautical activities. The legislation, which completed second reading in the House on November 7, 2006, contributes to Transport Canada's ongoing commitment to enhancing the safety of the national transportation system.

I'll outline for you today some of the key elements of the legislation, the content of which is very technical in nature.

Canada is one of the safest aviation systems in the world. This enviable record is due in part to the safety regulations that focus on accident prevention. Transport Canada's role is to provide the sound regulatory base on which the system operates. The department has a responsibility to have the tools in place to actively improve upon the safety performance of the industry. The aviation industry is increasingly global, and while globalization creates new opportunities for air transportation users and providers, it also highlights the need for a competitive business environment, for greater harmonization of standards and regulations, and for smarter regulations. To remain competitive globally, the industry must continue to improve its safety performance.

Regulating smarter is a phrase that is often used and involves continually improving regulations, better managing the regulatory process, and recognizing the shared responsibility of governments, citizens, and industry in making the system more effective. The result is less prescriptive regulations that are in line with the rules of other regulatory agencies, both within Canada and internationally, and meaningful consultations with wide reach to both industry and the public. In practical terms, this means regulations that impose rules that are more focused on safety results, with fewer interventions and that are designed, where appropriate, to give industry the flexibility to be innovative in meeting those outcomes.

The changes proposed to the act are reflective of the new strategies being implemented to regulate aviation safety but provide explicit enabling authority for newly evolved safety and regulatory initiatives such as safety management systems, considered an important component of regulating smarter.

Safety management systems will make a safe system even safer, while at the same time strengthening partnerships with industries by clearly setting out roles, authorities, and accountabilities, while ensuring high standards for transportation safety and reflecting the evolving role of government. This bill is the work of leading safety experts and international bodies that have been advocating that greater attention be paid to aviation safety at the human and organizational factors level. This means that problems, hazards, incidents, and accidents are not only reported, but the associated risks are analyzed and appropriate actions taken to prevent their recurrence.

Canada is among the world leaders in this area. Our American counterparts in the Federal Aviation Administration have also recognized the need to dig deeper to change our culture from one of diagnostics to one of prognostics. What this means is that we are moving away from just being reactive following accidents to becoming proactive by anticipating potential problems before they evolve into accidents.

It's important to note that the enabling authority for the safety management system regulations is valid and authorized under the existing act. However, for greater clarification and to provide additional statutory protections, the department is proposing to expand the minister's authority under the act with legislative amendments.

The proposal also includes, amongst others, new regulation-making authorities such as those respecting fatigue management and increased penalties for administrative proceedings and summary convictions. It is important to bring the level of penalties in line with other current legislation, since these penalties were last reviewed over 20 years ago.

Amendments to the Canadian aviation regulations that came into force in June 2005 require aviation organizations to implement safety management systems as part of an approach to improving safety risk management in the aviation sector. This is not self-regulation,and it is not deregulation; it is actually an additional layer of regulation, i.e., more regulation, to enhance the work Transport Canada continues to do through its oversight program. With safety management systems, operators must still comply with all the current regulations and standards, and Transport Canada can, and will, continue to take enforcement action when necessary.

Transport Canada's team of over 800 inspectors works with Canadian air operators, aircraft maintenance organizations, manufacturers, airport operators, and air navigation service providers to maintain the safety of our aviation system. These inspectors are well trained through the department's robust mandatory training program with specified courses and on-the-job training.

In a safety management systems environment, the role of inspectors becomes even more important, in that intervention is at the systems level rather than at the operational level. This means that systems put in place to ensure personnel competency, sound maintenance and engineering, and safe operations will be subject to assessment and validation, and the consequences of systems failures will be more dramatic and will potentially result in suspension of the operating certificates.

This is a clear manifestation of the change in the accountability framework, whereby certificate holders will be required to take ownership of the safety of their operation and become more accountable for their activities. However, the capability of inspectors who intervene at the operational level will continue to exist. In fact, deficiencies discovered at the systems level would warrant intervention at the operational level through audits and inspections. This change of accountability framework does not alter in any way Transport Canada's ultimate responsibility for providing the safety oversight of all certificate holders operating in a national air transportation system.

The bill before you today establishes a legislative framework for a voluntary, non-punitive reporting program under the act, including the appropriate confidentiality and enforcement protections. Transport Canada, with the strong support of most stakeholders, is of the view that the establishment of a voluntary reporting program under the Aeronautics Act will enhance aviation safety. Through the program, the department will have access to aviation information that would not otherwise be accessible. The information will be used to revise regulatory requirements and to develop promotional and educational materials. Individuals and companies will benefit by having access to and receiving additional safety information, including that on best practices and lessons learned.

Consultation has been very important during the development of this legislation, as it is for the development of all aviation regulations. The bill before the committee today is the result of extensive consultations with stakeholders through the Canadian Aviation Regulatory Advisory Council, which began in 2000. The council's prime objective is to assess and recommend potential regulatory changes through cooperative rule-making activities concerning the full range of Transport Canada's civil aviation regulatory mandate.

Stakeholders, including all major organizations and associations, have been involved in this consultation and are generally supportive of the amendments.

I look forward to responding to any questions the committee may have. I'm at your disposal in this regard, as are my officials. Thank you.

[The Chair, Conservative, Merv Tweed]

Thank you very much.

Who is next?

[LCol Jacques Laplante, Director, Flight Safety, Department of National Defence]

I am, sir.

Good afternoon, Mr. Chairman, ladies and gentlemen.

I am Lieutenant Colonel Jacques Laplante. I am the Chief Flight Safety Investigator at the Directorate of Flight Safety at National Defence and I thank you for allowing to make some introductory remarks to this committee on the proposed amendments to the Aeronautics Act. I would first like to say that these amendments are critical for the continued success of the Canadian Forces Flight Safety Program and the department's Airworthiness Program because they will allow us to correct multiple deficiencies that presently exist.

The director of flight safety, Colonel Shelley, is responsible for maintenance and implementation of the Canadian Forces flight safety program. Colonel Shelley, my boss, unfortunately had to be away today on flight safety duties.

Our flight safety program is a very successful program that deals with prevention, safe behaviour, and protocols for occurrence investigation. It has been in existence for more than sixty years and has been used by several other countries as a model for the development of their own programs.

The sole purpose of the flight safety program is to identify aviation safety deficiencies in military aviation matters and to make recommendations to eliminate or reduce such deficiencies. It is very important to note that our investigations are not used for disciplinary or administrative purposes.

Recent changes to the way air force operations and training are supported have led to a serious gap in the legal authorities for the investigation of military aviation safety matters when civilians are involved. The amendments would fix this gap. As you may know, civilian contractors are becoming more and more engaged in our air operations and training, with activities ranging from major maintenance overhauls on our aircraft to the long-term lease of Canadian-owned aircraft at the NATO Flying Training Centre, in Moose Jaw. Those are two examples.

The National Defence Act provides legal authority in respect of persons subject to the Code of Service Discipline, and lawful orders may be given to ensure the cooperation of military personnel involved in military aviation accident investigations. However, the National Defence Act does not generally apply to civilians, and certainly not in this context.

I must also point out that the civilian Transportation Safety Board is prohibited, by its enabling legislation, from investigating military aviation accidents unless the situation involves a separate civilian aviation facility or a non-military airplane. The investigation must then be coordinated with the Department of National Defence.

While we are responsible under the Aeronautics Act for military flight safety investigation, military investigators have no legal means of obtaining information from civilians and civilian contractors involved in military aircraft accidents. This responsibility cannot be exercised by the Transportation Safety Board because the Canadian Transportation Accident Investigation and Safety Board Act precludes them from investigating strictly military aircraft accidents.

Another related problem is our inability to obtain certain information critical to flight safety investigations, specifically from civilian companies and next of kin. Civilian companies provide a wealth of technical data and next of kin provide human factor data unavailable from any other source.

Ideally, we would also like to request that these organizations and individuals review preliminary draft investigation reports for their input. However, there is currently no penalty for unauthorized or premature release of information during the consultation process of the investigation. Since early release of investigation reports can compromise the investigation, we are very reluctant to conduct this kind of consultation, in fear of untimely release of incomplete or inaccurate information.

The lack of information can also be very traumatic for next of kin, because in complex investigations that last years in some cases, they do not receive timely updates on the investigation until it is complete. This, too, is based upon the possibility of untimely release of information.

These release problems will be solved by the provisions of the amendment that will make unauthorized release of investigation information contrary to the Aeronautics Act. This will allow us to share preliminary information during the consultation phase of the investigation process, with confidence that it will not be released.

The new part II of the Aeronautics Act will give military investigators appropriate powers to conduct full and proper investigations into military aircraft accidents that may involve civilians. Military investigators will be thoroughly trained in respect of all aspects of their new powers before being allowed to exercise these powers. As the new powers are similar to those currently set out in the Canadian Transportation Accident Investigation and Safety Board Act for the Transportation Safety Board, the private sector involved in aviation matters in Canada should be very familiar with their application.

The amendments will also encourage voluntary reporting by protecting the identity of persons who report. And the amendments will also facilitate the sharing of information with the Transportation Safety Board, for coordinated investigations, since both offices will have the same obligations to protect privileged information.

Lastly, the proposed legislation will obligate the Department of National Defence to publicly release the final flight safety investigation, to ensure the public of an open, independent investigation process. We have been doing this on our own initiative since 2003, as a normal practice for all final investigation reports.

In conclusion, the proposed amendments are critical to improving the ability of the Canadian Forces to ensure the safety of the men and women in the military aviation community, civilians involved in military aviation, and the general public.

I will be pleased to answer any questions the members of the committee may have. I am also assisted here today by Mr. Alex Weatherston, our legal counsel at the Department of National Defence, from the legal services office, who has worked on the development of this bill.

Thank you, Mr. Chair.

[The Chair, Conservative, Merv Tweed]

Thank you, Lieutenant-Colonel.

Is anyone else pitching? No?

I will turn it over to Mr. Volpe, for seven minutes.

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

Thank you, Mr. Chairman.

Let me say thank you very much to our witnesses for coming forward and helping us to understand a bit better what we're about to vote on soon, I suppose.

I just have three very brief questions, if you don't mind. They really relate to some issues.

The first of these issues is that this legislation is so important. Because it's enabling, it provides the government or the Minister of Transport with the opportunity to get information and to pass regulations. It's my understanding that you're already doing a lot of the work that presumably the regulations that would flow from this would enable the department to do. Is that a mistaken impression?

[Franz Reinhardt, Director, Regulatory Services, Civil Aviation, Department of Transport]

If you're talking about the establishment of safety management systems, the current legislation enables the minister to make regulations with respect to that. We've already started doing this for the major air carriers and some other segments of the industry.

However, in order to clarify that authority and also provide specific protection provisions in order to allow people to do internal reporting without fear of reprisals, we needed to expand the enabling authority under this proposed amendment. That's why we are simply expanding upon what we already had before.

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

What you had before was that which you expected to get through the legislation, so let me take you one step further. Let's say that on a dark day in March the government decides it can no longer govern and you don't get your legislation. What happens to the regulations that will not have been put in place but are in fact being applied?

[Franz Reinhardt]

These regulations are still valid. Safety management systems are valid. The requirements for organizations to abide by the basic criteria are valid. However, the protection provisions that we are seeking now—to further the internal reporting, to get more access to more safety information—will not be enabled. I believe that would make for a system that is not as robust and one that would not provide as much information as we would expect to have in order to go the extra mile to advance safety.

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

Part of the enabling will also call into question a series of relationships as the safety management systems are being rolled out. As you say, they're already there, but they aren't all fully operational because we're actually trying to expand the authorities of the minister in order to ensure a variety of outcomes.

It's my understanding as well that there will be several bills conflicting with each other. I'm not sure yet whether Bill C-11 captures the responsibilities under the Canada Labour Code. Would you address that for a moment?

[Merlin Preuss]

I think we all realize that the Canada Labour Code is “notwithstanding” legislation. That means that what the enterprises involved in safety management systems will have to do is create a system in which the obligations of the Canada Labour Code are clearly met.

We have a working agreement with Labour Canada on how we are going to deal with any conflicts. We don't anticipate any major problems with this because at the end of the day, especially where we're looking at how it's applied to aircraft operating, it's really not a split responsibility to enforce it. Our systems should be quite nicely interleaved.

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

I have one other observation, and it's one that came up as a result of a program where the minister was interviewed. On the question of fines, which you've raised here in your briefing notes, they're going up from $5,000 to $50,000 for individual violations and from $25,000 to $250,000 for corporations.

Given that most of the people who would be the subject of an investigation or a fine are probably covered by corporate insurance in the event of such an instance, is that amount, the new amount, an accurate reflection of what might be considered a deterrent in the current marketplace, or should this amount be much higher to ensure compliance?

Notwithstanding the fact that I think you said this is not going to be prescriptive legislation, that it's really going to encourage much more voluntary compliance, you still took the trouble to talk about modernizing the amounts of fines. So I'm interested in your reflections on that.

[Franz Reinhardt]

We believe, first of all, those will be the maximum. As you know, we can go lower, but those are maximum fines. We think they are reasonable—

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

Excuse me a second. That's precisely my point. If that's the maximum amount for a corporation.... For the sake of naming a name, let's use Air Canada; $250,000 for that corporation is probably a pittance.

[Franz Reinhardt]

First of all, yes, you may say that may not be a big amount, but we can go under what we call summary conviction where it's a fine of over $1 million. So there's also that possibility.

There's also the question of the reputation of the company as well. As you know, we post a corporate offenders' list on the website when these things happen. We're dealing here with companies mainly. I'll give you an example. For instance, if there are violations with respect to noise abatement at airports, a company will sometimes pay the $5,000 or the $20,000 because it's the cost of doing business, as opposed to having to lodge people abroad for maybe a higher amount of money.

We believe $250,000 is a reasonable increase from what it was before, taking into consideration the fact that there's also the summary conviction that could go as high as $1 million.

[The Chair, Conservative, Merv Tweed]

Monsieur Laframboise.

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

Thank you very much, Mr. Chairman.

Mr. Preuss, I did read your presentation. I am concerned because you are telling us that you started to work on this in 1998. You set up a committee, a sort of industry panel, which has been meeting since 2000. You concluded by stating that the industry representatives support the bill that is before us now. They all seem quite satisfied with it. My only problem is that it is not up to the industry to decide how aviation safety is managed; that is up to Transport Canada. My general impression is that rather than strengthening Transport Canada's authority and that of its inspectors, more power is being given to the industry to guarantee safety. I find that far from reassuring.

I will ask you my first question. Currently, as far as commercial transportation is concerned, verification of industry capabilities, etc., is done by your inspectors; you said so earlier. How many do you have?

[Merlin Preuss]

These days we have around 800 inspectors engaged in oversight activities.

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

How many did you have in 2001?

[Merlin Preuss]

I'm not certain of those figures, but they certainly haven't decreased. In fact, there may have been some increases. I can come back to you with the exact numbers. There has been no dramatic change in the last five years in the total number of inspectors.

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

That is what I thought as well. The number may have remained stable, but the problems in aviation safety have increased over the years, and you have not increased your inspection section staff. That worries me.

Why have you not done so? Why did you not decide to put more effort into guaranteeing the safety of the industries? Why did you not make that choice?

[Merlin Preuss]

If I understand you correctly, you're indicating to me that you have information that says our safety performance in this country has deteriorated in the last five years?

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

No, it is not that. In order to increase safety, you have introduced this bill and you want to create designated arm's length organizations, and put in place a safety management system that is administered and supported by the industries. Personally, I would have preferred to see you planning a safety system that relied on an increased presence of Transport Canada inspectors, on arm's length industry specialists, precisely to guarantee safety.

Why did you not choose to do that? Why are you turning more towards independent organizations rather than increasing the power of Transport Canada's service?

[Merlin Preuss]

We're not in fact turning to the private sector. What we're doing is increasing their accountability.

As I said in my opening remarks, sir, on the safety management system requirements, those regulations are in addition to what is already there. In fact, I often say, when asked this question, that the first requirement of a safety management system is to clearly show how you're complying with the current regulations.

So it's a system that sits on top of everything that is there today. It is not a reduction regulation. It is not deregulation. It is not turning over oversight of the operations to the enterprises, whether that's Nav Canada, or the airports, or Air Canada. It's very much an additional requirement.

Our insertion point will be at the systems level so we can capture all of the issues, rather than pinpointing one or the other. If that doesn't solve the problem, we will be able to intervene in the same way we do today.

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

Mr. Preuss, the committee's job is indeed to call experts to appear before us. One of them, Judge Moshansky, stated in the Toronto Star on June 16, 2006, that he strongly doubted that Transport Canada would be capable, with fewer civil aviation inspectors, of fully carrying out its duty to ensure the air transport security of the travelling public. This judge studied all of the safety problems after the 1998 crash at the airport in Dryden, Ontario.

Some specialists are already beginning to criticize your position. I'm having difficulty understanding. It seems to me that after the events of September 2001, we must increase security. You are choosing to make the industries more independent rather than doing what is being recommended to you. We are going to call the judge to appear before the committee. Personally, I'm having a great deal of difficulty understanding your approach.

Why did you not choose to increase the number of inspectors, to increase your oversight? Try to enlighten me on this subject.