Mr. Speaker, I am honoured to be rising to speak to Bill C-46, an act to amend the National Energy Board Act and the Canada Oil and Gas Operations Act. We know the bill deals with the whole question of liability for pipeline spills.
My riding of Toronto—Danforth is a very strong environmental riding. The environmental consciousness of the average citizen is exceptional. Constituents are very concerned about the serious environmental risks associated with pipeline projects in Canada, including oil spills. It is also important to say they also understand that pipelines are directly tied to the facilitation of accelerated oil extraction and oil export that is at cross purposes to the urgent need to fight climate change, the single most important challenge the world faces and, indeed, the single most important challenge that we have faced for decades without acting properly on it.
Many also realize the particular risks of localized pollution of diluted bitumen once it spills in any form, whether from a tanker or from a pipeline, as the member for Saanich—Gulf Islands has been emphasizing in today's debate. My constituents have very little faith that the government is taking steps in general to ensure that these kinds of environmental concerns are thoroughly addressed. They need to know that the environment is being protected and that necessary preventive and response measures are going to be put in place.
Of course, I take these concerns seriously. When it comes to major resource projects like pipelines, the NDP believes that proper community consultation, respect for the rights and title of aboriginal peoples, and rigorous environmental assessments are the bedrock of any kind of viable sustainable development approach. This has not been the approach taken by the government, by and large, in the review, for example, of northern gateway, Kinder Morgan and Keystone XL, and in the same flawed process that was applied to Line 9 and is now being applied to Energy East.
The legislation we are debating today is, however, a step forward. Bill C-46 seeks, among other things, to ensure that some polluters will be absolutely liable for harm caused by a pipeline spill, including environmental damage, what is termed in the bill as non-use harm. The bill includes absolute liability for all National Energy Board regulated pipelines. That means companies would be liable for costs and damages, irrespective of fault, up to $1 billion for major oil pipelines, which are pipelines that ship or transport more than 250,000 barrels of oil a day. Where there is fault, including negligence, there is no cap, and that is a good feature of this bill. For those under 250,000 barrels a day, it is left to regulation. Therefore, there is lack of clarity as to what the liability cap will be for smaller operations.
It is a good start, as I have said, and that is why, of course, I will support it at second reading. From what I have heard, most of my colleagues, if not all of them, also will be. We need to send it to committee for further study and amendments, and this is exactly the kind of bill where there will be real expertise brought to bear from across the spectrum. I honestly hope the committee will have enough hearings to go into the finer details of the bill to get it right. There seems to be a cross-party consensus that it needs to be done right, by and large, and it is not the kind of bill that should be overly politicized.
We in the NDP have long been consistent in our position that companies, corporations, and not taxpayers and not citizens who call on the public treasury for other government programs, should cover the cost of pollution. The bill is long overdue as a first step toward a polluter pays regime for pipelines in Canada.
There are some other specific provisions I should briefly point out by way of being somewhat laudatory of what the government has put forward in Bill C-46. One is that aboriginal governments, termed “any Aboriginal governing body”, in the bill, are treated similarly to other governments, municipal, provincial and federal, in terms of the role they play in cleanup and being compensated for any kind of cleanup they have to do. Other powers and rights are given to them as well, and that is something.
Additional remedies, as part of the judgment that a court can give under offence provisions in the National Energy Board Act, include such creative possibilities as ordering the creation of scholarship funds for environmental studies. This is written into the bill.
Interim compensation is possible as one of the orders from the new pipeline claims tribunal, which can be called into being in cases of so-called designated companies. The system set up by the bill would have the ability to access as much of the pooled liability reserve funds as the National Energy Board would deem needed in the case of designated companies. Therefore, when a company is sharing a pooled fund, to ensure it has enough money, it is not just its share of the pooled fund that can be accessed, but the entire fund, at least on my reading.
Also, in terms of the kinds of fines that come with the offence provisions that already exist in the National Energy Board Act, there are a number of new headings under which aggravation of damages could be sparked, or what kind of extra factors would mean higher fines. One of the aggravating factors is where there is evidence that shows that the corporation allowed the spill to happen essentially as part of an economic calculus in order to save costs, in order to make more money.
All of these things are to be commended in the bill. There are, however, more than a few problems.
The first problem has been mentioned a few times, and that is setting the limit on liability in cases of so-called non-fault at $1 billion, which may not be sufficient. The member for Saanich—Gulf Islands has already indicated clearly that we know it has already cost more than $1 billion for the cleanup in the Kalamazoo River area. We also know the cleanup has not actually worked and to some extent the attempt goes on, whether a real cleanup will ever be possible given the nature of diluted bitumen.
Second, much of the bill is heavily laden with regulatory and discretionary provisions. An awful lot of power is given to the cabinet and the National Energy Board to set out detailed regulations. This includes, for example, that this new pipeline claims tribunal exists in the act in a very general way. The Governor-in-Council, however, would be given the power to make regulations on virtually everything to do with this tribunal, including in subclause 48.47(a) “prescribing the terms and conditions of appointment of its members”. There is nothing in the act—we have nothing to look at—to know what kind of tribunal this would be. Where are these members going to come from? How are they going to be appointed? How do we know this tribunal will be a fair and adequate replacement for the courts, for example, in the stream of cases that might go to it? There is actually a lot of room for manipulation of that pipeline claims tribunal by virtue of so much being left out of the act.
Other problems are more in terms of how things are left to regulation, even as the act has taken care to ensure some things cannot be regulated. For example, it appears from my reading that the Governor-in-Council cannot prescribe higher amounts than the $1 billion on a company-by-company basis. It is allowed to say yes for a certain kind of pipeline that carries much more than 250,000 barrels per day that the liability limit should be more than $1 billion. However, it cannot do that on a company-by-company basis, although it would be specifically allowed to do it on a company-by-company basis for pipelines involving under 250,000 barrels. Therefore, if there is a company that is notorious for having problems, notorious for non-compliance, notorious for being a greater risk and yet still is in the game so to speak, there seems to be a prohibition on treating that company differently. There is a kind of formal equality idea here, which is a problem.
In terms of the amount of cash on hand that a company has to keep in order to cover liability, the National Energy Board is not required to ensure that the money on hand includes enough money for any potential loss of non-use value, which is code in the bill for environmental damage relating to a public resource. This is part and parcel of a couple of features we discussed earlier in questions and answers in relation to an earlier speech. There are a couple of areas in which, although the act starts out by saying so-called “non-use value”, environmental damage is covered as one of the three major heads of damage that the bill's liability provisions are meant to go to, but there are other provisions in the act that seem to claw that back.
In conclusion, this is a good start for sure, but at the same time it is a bill that needs close scrutiny in committee. It is the kind of scrutiny that will be very easy to understand in terms of what is necessary to improve the bill. I hope all parties will gather together to do that.
