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.

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

The royal assent on Bill C-8 is this afternoon at 3:30, if anybody's interested.

[The Chair, Conservative, Merv Tweed]

Okay. I guess if we are passing out accolades, I will let the committee know that I received a personal phone call from the grain shippers to thank us for our speedy passage of Bill C-8. They were very pleased with that too.

It is good to see the committee receiving good news.

[Kevin Bender, Director, Western Canadian Wheat Growers Association]

Thank you, Mr. Chairman.

The Western Canadian Wheat Growers Association welcomes this opportunity to appear before you all today.

I'm a director of the association, and I farm near Red Deer, Alberta. I also sit on the board of directors of the Alberta Canola Producers Commission, and I recently completed a term in the Canadian Canola Growers Association. However, my views here today will be primarily from the wheat growers' perspective.

Joining me today is Blair Rutter, our executive director from Winnipeg.

The Western Canadian Wheat Growers are a prairie-wide voluntary farm organization. For 38 years we've been advocating forward-looking farm policies to improve the profitability and sustainability of our farms. Our board of directors consists of 12 farmers who have a passion for agriculture and the determination to make farming more profitable. It is our optimism about the future of our industry that keeps us energized.

Grain prices are currently strong in western Canada, so that's helping to fuel our optimism. We know, however, that good grain prices can be fleeting, so that's why we're always seeking policy solutions that will help make farming more profitable on a long-term basis. We see biofuels as an excellent opportunity in helping us to achieve that goal.

Bill C-33 makes provision for regulations that would require gasoline to contain a 5% average renewable content by 2010 and diesel and heating oil to contain 2% average renewable content by 2012. The wheat growers support this legislation and urge committee members to give it their full support as well.

Currently, there are five commercial ethanol plants in operation in western Canada and two more that will be opening soon this year. Combined capacity of these plants will be 500 million litres, which would, in total, consume about 1.4 million tonnes of wheat, or approximately 7% of the average wheat production in western Canada. Of course, these wouldn't use wheat exclusively; corn and other cereal grains would be part of that as well.

While ethanol has been produced on the Prairies for more than 25 years, we really are in the infancy stages of a large-scale biofuels industry in western Canada, so it's difficult to predict the full impact. In our view, biofuels and bioproducts represent a great opportunity to create a more sustainable future for our industry. Over the next few minutes, I'll talk to you more about the value of biofuels to prairie grain farmers.

First of all, increased ethanol production will help reduce our dependency on foreign grain markets. There are always a number of risks when you're exporting grain offshore. We're vulnerable to tariff and trade barriers, labour disputes, railway service disruptions, and high ocean freight rates. In the past year, the prairie grain business has been disrupted by two railway strikes and a trucker walkout at the Vancouver port. Having more grain processed domestically helps mitigate the impact of such disruptions.

Another benefit of the ethanol industry is that it would provide farmers with another local outlet for marketing their grain. As we've discovered in the canola, oats, and pulse sectors, local users of grain improve competition and help support local prices. The value of ethanol and biodiesel plants will be particularly evident when grain downgraded by weather or disease is able to be used for biofuel production.

Increased local processing also reduces our dependency on shipping grain by rail. In western Canada, our industry continues to be constrained by service and performance issues in the rail sector. In this regard, the wheat growers were very pleased to see transportation legislation, Bill C-8, passed by Parliament, and we thank all parties for their support of this legislation. It's my understanding that it has been passed by the Senate and is just awaiting royal assent.

The fact remains, however, that in western Canada the two main railways haul about 65% of the grain we produce. In our view, one way to improve rail service and increase competition in grain handling is to increase the amount of grain that is processed locally. Wheat varieties that are well suited to the ethanol industry often have agronomic advantages and so they represent a good rotational fit on many farms. Promoting a biofuel industry also creates more jobs and economic activity in rural areas. For those farmers who invest in these facilities, it also gives them an opportunity to capture a greater share of the value chain.

Finally, processing more of our grain locally helps ease the growing congestion on the rail lines and at ports. Rather than shipping our grain long distances, we think it makes more economic and environmental sense to process it closer to home.

In our view, there's no question biofuel plants provide tremendous value to grain farmers and communities across western Canada. We note that the renewable fuel standards contemplated in this legislation include provision for next-generation feedstocks, including straw and other biomass material. The wheat growers also support these forward-looking provisions.

We recognize and appreciate the concerns raised by the livestock sector with respect to the possible increase in feed grain prices resulting from the development of a biofuels industry. Many of our members also have livestock operations, so we take these concerns very seriously.

We note that studies in the U.S. have shown that livestock operations have flourished around ethanol plants. This is also the case in Canada. In fact, the oldest ethanol plant in western Canada—the Pound-Maker facility in Lanigan, Saskatchewan—is a fully integrated ethanol and feedlot operation. Other ethanol projects under development have a strong livestock component.

We think it's worth noting that many of the wheat varieties that are well suited for ethanol plants are much higher yielding than varieties used in the milling industries. Often, yield per acre is substantially higher than that of milling varieties. If the ethanol industry expands significantly in western Canada, we could see higher production of wheat, corn, and other feed grains. The resulting distiller dried grains, or DDGs, produced from these plants will provide the livestock industry with a relatively lower-cost feed grain supply.

Admittedly, we don't know what the full impact of biofuels on the livestock industry will be. However, we believe that it's too early to assume that the growth of the biofuel industry will be negative for the livestock sector.

The wheat growers want to see the development of a biofuels industry that is sustainable, without the need for mandates or subsidies of any kind. We recognize that some argue that the biofuel industry will not be viable without government intervention or support. We do not share this view. Of course, economic viability will ultimately depend on the price of the oil and the feedstocks. However, we believe that technological improvements in processing and in variety development will be such that biofuel production will one day be economical and sustainable without government intervention.

Regarding wheat variety development, our association would be remiss if we did not comment on this committee's work in recommending the removal of kernel visual distinguishability, known as KVD, as a criterion for the registration of new wheat in western Canada. The removal of this constraint will lead to the development of wheat varieties that have yield and starch profiles that are well suited to the ethanol industry. We applaud your committee and the federal government for your foresight in bringing about this policy change.

Bill C-33 will also help spur the development of new markets and new uses for our crops. For example, the fractionation of wheat, barley, and other grains offers significant opportunity for the development of healthier food, pharmaceuticals, and industrial products.

In summary, the wheat growers support Bill C-33. The legislation will provide Canadian farmers with greater marketing opportunities and will lessen our dependence on export markets. The development of a biofuels industry will lead to greater investment in crop research and development and in processing technology. It also offers an excellent opportunity to create jobs and economic activity in many rural communities. We ask your committee to endorse this legislation and ensure that it is passed in the parliamentary session.

Thank you again for this opportunity to address you. We look forward to any questions you may have.

Rail Transportation

[Lawrence Cannon, Conservative, Minister of Transport]

Mr. Speaker, I am pleased to advise all members of the House that Bill C-8 is supported by both parties in the Senate. Senators are aware of the fact that the support for the bill was unanimous and that clause by clause on Bill C-8 was completed in a record 15 minutes in committee.

Given that no one in either house opposes Bill C-8 and that there are no unresolved issues remaining, it is my understanding that Bill C-8 should get through this week for our shippers and people needing this.

[Carol Skelton, Conservative, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, Bill C-8 makes amendments to the Canada Transportation Act that will help protect rail shippers from potential abuse of market power by railways. This is great news for rural Canada and for Canadian farmers and manufacturers.

The Grain Growers of Canada and the Saskatchewan Association of Rural Municipalities both voice their support for the bill and encourage the Senate to pass it in a timely manner.

Could the Minister of Transport, Infrastructure and Communities inform the House when he expects the bill to pass the Senate?

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

We'll get to the numbers in just a second.

You led into the issue that I wanted to bring up, and that's reducing transportation costs to our farmers--not just costs, but also headaches.

As you know, Bill C-8 is a fairly comprehensive bill, one that faces a long and arduous task in the Liberal-dominated Senate. We need to do something for our producers in western Canada that significantly helps them to turn their costs downward on things like transportation and input. In my area anyway--the Westlock and St. Paul area--this is one of the areas that would significantly....

Anyway, could we get the numbers now, Mr. Chorney, that you were...?

[Richard Phillips, Executive Director, Grain Growers of Canada]

Thank you.

He touched on the biodiesel part from the Grain Growers; I'll just touch on some ethanol thoughts.

I have five brief reasons why we are happy to see an ethanol industry develop and why we would support Bill C-33.

Number one—and I'm speaking more from a western Canadian perspective—it reduces our dependency on foreign grain markets; in western Canada we're heavily dependent on exporting, and when you're exporting your grain offshore, you're vulnerable to tariff, non-tariff barriers, currency fluctuations, labour disputes, and ocean freight rates. The more grain we process locally, the more we avoid those issues.

Secondly, it reduces our dependence on shipping grain by rail. I've been before the committee before and I've talked about Bill C-8 and the need to get some shippers' provisions in dealing with the railways. In western Canada, the two main railways haul about 65% of the grain we produce, so anything we can ship to local production and local value adding will reduce our dependency on those railways. We hope you have followed up with your Senate compatriots and encouraged them to put Bill C-8 through quickly.

Thirdly, it provides us with another local option for marketing our grain beyond some of the feedlots and the other smaller value-adding processors that we do have out there. As we've seen in the corn, canola, oat, and pulse sectors, there's nothing like local buyers of grain to support local prices. From our perspective as producers, the more competition for our grain, the better.

Fourthly, it creates jobs and economic activity in rural areas. It's not just the truckers hauling in the grain, but it's the electricians who have to service the plants and the plumbers who provide the water. There's a lot of work and a lot of services needed to keep an ethanol plant running. That all spins off into other jobs in the communities as well.

On the environmental aspect, even leaving aside the arguments of some of the studies, the fact that we're not using fuel to haul our freight all the way to port to get to overseas markets--we're just taking it down the road to a local ethanol plant--that alone is a huge environmental savings, in my mind.

What are the challenges that we see? Number one, keeping producer ownership where there's a strong interest in investing. My father and I have put a fair amount of money into our local ethanol plant. It's a challenge because there are people coming in. Some day if we're successful there will be a takeover bid, I'm sure. So whatever structures can be put in place to encourage and enhance local producer ownership in the plants, we think, is critical to the long-term success in western Canada.

On keeping our livestock sector strong, I know there are some challenges out there with the feed prices right now. Whatever we can do, beyond even the dry distillers grain that is going to come out of these ethanol plants, the livestock sector is an important market for our feed grains.

I have three or four quick suggestions. We think if the committee is looking at what they could do in addition to Bill C-33, there is research into the feedability of these dry distiller grains to the beef, and especially into the monogastrics like hogs--what are the maximum rations we could use? There is also research into the component parts of wheat and corn that could be removed even before the ethanol process, like the germ. Besides the DDGs, there are many other enzymes and products in kernels of corn that could be used for other purposes. Lastly, there's research into wheat and corn varieties that are best suited to ethanol production. Let's do what we can to improve upon the formula of one unit of energy in and 1.4 units out in ethanol. Those are a couple of suggestions.

I look forward to the questions. Thank you.

[Bob Friesen]

Thank you.

Mr. Lauzon, I think you mentioned several things. One is transportation, and of course we supported and thank you for how quickly you brought back Bill C-8 when you came back to the House. We're also asking for a full costing review on the efficiency cap, and have already talked to the minister about that, as a complement to what's being done in Bill C-8.

On fertilizer prices, let's be clear about one thing. The prices aren't high just because fertilizer companies are running 24/7 and there's a big demand. My guess is they would be high even if there was an abundance of fertilizer, because they've seen grain and oilseed prices going up. They know that farmers are going to pay the price. So there's something there that we need to deal with as well.

There's a further complication in fertilizer prices. I think everybody knows that grains and oilseed farmers have a little more cash from 2007, but they had a deep hole and paid a lot of bills in fall 2007. So if a farmer couldn't afford to buy his fertilizer in the fall because he paid other bills, he will have to wait until the last possible moment in the spring before he buys fertilizer. He's looking at an increase of several hundred dollars a tonne, and natural gas prices have gone down. So that's another dynamic that we somehow have to deal with.

[Richard Phillips]

Just in closing on the fertilizer point, what we see is a huge demand for this fertilizer around the world, and as Canadian producers, we're going to be competing to keep those products here in Canada. What can the committee do? What can the government do? I think if there's anything that could be done to stimulate the production, if there are new mines that people are looking at, if there are incentives that could be put in place for more production.... I don't think we're going to have a situation in which we're going to try to limit the exports of fertilizer. I don't think the Government of Canada is going to go to the companies and say they can no longer sell to China. If we can't decrease the demand for fertilizer, then we're going to have to increase the supply. That would be what we would see coming down the road.

The other piece we would briefly like to touch on is grain transportation. We've done a lot of work on this file with the Grain Growers of Canada. We would like to thank all members of this committee for the work they've done in getting Bill C-8 through the House quickly. As you know, when Bill C-8 gets through the Senate, one component of it is the promise that there will be a level-of-service review of the railways 30 days following. Grain transportation is one of the larger costs that we also have in western Canada for all of the export commodities. So we want to see things going forward like the level-of-service review. We would be quite interested in seeing a costing review also of the railways, and anything that could be done to enhance competition on those rail lines would be well received by the producers. Again, with supply and demand, if there are only two suppliers, then you pay the price. So whatever can be done to increase competition of the railways and increase the supply of fertilizer would be steps in the right direction for this committee.

Thank you.

Business of the House

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

Mr. Speaker, since this is the first Thursday question of the year, I want to formally welcome everyone back to the House of Commons. Hopefully, we will be even more productive in 2008 than we were in 2007.

Judging by the first sitting day, I think we will be.

So far, the House has passed Bill C-8, on railway transportation, and Bill C-9, on the settlement of investment disputes.

Moreover, Bill C-31, An Act to amend the Judges Act, and Bill C-27, on identity theft, have been referred to committee.

This is a rather good start.

We hope to keep up that level of productivity by quickly passing our legislation to strengthen the security certificates process, which started debate at report stage today. That is of course Bill C-3. We now have a House order to assist us in facilitating that debate. We will continue to debate the bill until report stage is completed.

While all members of the House do not understand the importance of the bill, I believe that the official opposition does. I hope that we can work together in a spirit of cooperation and bipartisanship to have it passed before the date identified by the Supreme Court of Canada as the date by which it would like to see the law passed, February 23.

Following Bill C-3 tomorrow we will continue with the unfinished business from this week, namely Bill C-33, renewable fuels; Bill C-39, the grain act; Bill C-7, aeronautics; and Bill C-5, nuclear liability.

Next week will be a safe and secure Canada week.

Debates will continue until the bill is passed by this House.

After that, we will debate Bill C-25, which would strengthen the Youth Criminal Justice Act, and Bill C-26, which imposes mandatory minimum penalties for producers and traffickers of drugs, particularly for those who sell drugs to children. We also hope to discuss the Senate's amendments to Bill C-13, on criminal procedure.

Finally, in keeping with next week's theme, I would suggest that my hon. colleague opposite explain to his colleagues in the Senate the importance of quickly passing the Tackling Violent Crime Act, the bill which is overwhelmingly supported by Canadians across the country, and which was the number one priority of the government throughout the fall session of Parliament and which passed this House last fall. It has already been in the Senate longer than its entire time in the House of Commons, yet the Liberal dominated Senate has not even started committee hearings on the Tackling Violent Crime Act.

While the elected accountable members of the House rapidly passed the bill, which I would like to remind everyone was a question of confidence, unfortunately it looks like the unelected, unaccountable Liberal dominated Senate is up to its old tricks again of delaying and obstructing in every way. Let me be clear. This government will not stand and allow Liberal senators to obstruct, delay and ultimately kill the bill. The Tackling Violent Crime Act was quickly passed in the House and Canadians expect the Liberal dominated Senate to act in the same fashion and pass it quickly.

Canada Transportation Act

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I am very pleased to rise today to speak on Bill C-8, which people will remember was previously Bill C-58 and which is an act to amend the Canada Transportation Act. We are dealing in this case specifically with railway transportation.

I have already regaled the House with the rich history of my family in that I come from a long line of railway magnates. My great-great-grandfather was John P. McNeil. The “P” did not stand for anything. It was just that every man in the village of Iona was named John so they had to distinguish him from his eight brothers whose first names were all John as well. There were John Roderick, John Francis, John Albert, John Alec and John P. They ran out of names because the Scottish only name people after dead people and there just were not that many dead people in the family.

The great John P. McNeil was a porter on the Sydney Flyer. My grandfather told me that the family did not eat at night until John P. came in. It did not matter how late. The kids would wait out in the hallway for John P. to come in. He would sit down and when he had finished eating, he would say, “McNeil has dined”. That meant the children could eat.

That is actually a tradition that goes back to the 1200s and even before that when the McNeils were on the island of Barra. It was a raiding base for the Vikings. The McNeil, who was the clan chieftain, claimed the right to eat before all the lords of the earth. That is an actual historical fact, not that any of my relatives ever lived in the castle. I think they pounded seaweed on the shore for a living and then were sort of unceremoniously removed from their land and sent to Cape Breton, where they had to find work. Some of them went to the coal mines, but John P. worked on the Sydney Flyer.

Mr. Speaker, I know you are waiting for me to get to the punchline, but I think it all adds to the story.

I do not know if John P. had many great skills, but one of his skills was that he could always tell that a bootlegger was coming into Sydney. When they were coming in on the train, he would say, “A man who has a bottle of whisky in his suitcase always puts that suitcase down with just a little more care than if it was just his long johns”.

Of course there was not enough work for all the McNeils, so they had to move to Ontario and work in the mines. The ones who did not want to work in the mines worked on the railway, the great Temiskaming and Northern Ontario Railway. Part of my long, illustrious history is that my uncles, Andy and John, were porters on the T and NO Railway.

My mother tells the story about their travel along that railway from Timmins to North Bay in the summer. They would load up on the car in Timmins with a ticket that would last them as far as Schumacher, which was about two miles down the road. They would have their sleeping bags and coats. Obviously they were going on a long trip. They were always terrified that someone was going to notice that their ticket was for only two miles, not for 250. My uncles knew everybody on the train and used to travel up and down the train line for free to go stay with the aunts.

I know, Mr. Speaker, that you are wondering what this is all leading to. It speaks to my passion and yours. I am very glad that you are in the chair because of your deep love of history and railway. I know that you will give me a little leeway to sort of draw out what exactly the point of this discourse is.

I would like to move forward now to the 1980s and my own interest in the railway. We are talking about the government and its vision for infrastructure. It is putting in all kinds of effort on the gateways and ports but if people ever travel across this country they have to understand that it is not just the gateways, the ports or the megaprojects that make infrastructure work in this country. It is actually being able to connect them to the various places that makes it work, which of course goes back to my family's history on the railway.

The railway plays an important role in connecting. We have seen over the last number of years how much of the railways have been left. In some parts of the country they are being torn up and there are other areas where we have not built the necessary infrastructure.

As I said, I would like to speak about the 1980s, when a famous Scottish band came to Canada. This is a true story, although I know it sounds like a joke. A Scottish band came to Canada. I think it was called Aztec Camera. The band members landed in Halifax at that great port and then flew to Montreal. They played in Montreal and then drove to Ottawa. They left Ottawa and drove along the great highway. When they got to Toronto they thought, “This is what we always thought North America was”. Then they were told, “Your next gig is in Winnipeg. There is the bus. Now drive to Winnipeg”.

About 16 hours up the highway on the way to Winnipeg, a highway consisting of two lanes of traffic, moose every 10 feet, trees and no lights, the road manager looked at the driver, who was Canadian, and asked him if he could not have picked the Trans-Canada Highway to travel across the country. The driver said they were on the Trans-Canada Highway.

Anyone who has driven across this country knows that long, terrible drive through northern Ontario. Northern Ontario is made up of some of the prettiest country in the world, but Highway 11, which I live on, is in a terrible state. It is the truck transportation route for this entire country. If goods have to be moved west to east, they have to be moved along that little strip of moose pasture that runs between the rocks. People in northern Ontario ask why so many trucks need to be on these two lanes of traffic when the rail line is sitting right there and half the time is empty. That is the issue in northern Ontario.

We need to connect the infrastructure of this country so we do not just have great port plans and great transportation links with our major trading partner, the United States. We need a forward looking plan to ensure that goods coming off container ships from the Far East can be transported across this country in an efficient, economical and environmentally friendly way. The train, of course, takes on an important light.

Our role in Parliament is to look at how to improve the transportation networks of this country. Bill C-8 addresses a number of concerns that have been raised by shippers dependent on railway transportation. Over the years shippers have raised many legitimate concerns about how pricing is done on railways and about access to goods.

They also have raised concerns about the duopoly that exists right now with Canadian Pacific and CN and their ability to basically call the shots for anything that is going to be shipped in certain areas of the country. This financial stranglehold has a major effect on competitiveness and trade.

Many people who ship goods, whether they are agricultural products or products being shipped out of a mine's large bulk operations, are very dependent on the prices they receive from CN or CP for the cost of bulk transportation. Under a duopolistic regime, these shippers have very few alternatives to get their products out.

We know that there are 30 federally regulated railways in Canada, but many rail shippers are still captive shippers who are still dealing with these two big players. We need to look at how we ensure fairness in a system that does not have major competition and a system where it is not practical to bring in competition on these lines.

One of the changes we are looking at is a change to ensure a little fairness in pricing and how pricing is done so shippers get a fair deal, whether they are shipping grain or copper concentrates to ports.

The amendments to the Canada Transportation Act in Bill C-8 would help address some of the shipper concerns about rail service and rates that have been raised time and time again while at the same time providing regulatory stability to the railways to encourage needed investments to keep our exporters and importers competitive in international markets. This is key. We really need to ensure that the railway system maintains a sense of strong commitment to invest.

As Canadians, of course, we want to invest in our railways because they do play such a vital role and they always have, the Brian Mulroney regime notwithstanding.

A number of the amendments brought forward in Bill C-8 were actually developed in concert with shippers who brought their concerns to Parliament.

We are looking at the regulatory impact of the bill. One amendment would remove the requirement for a shipper to prove substantial commercial harm before applying to the agency for certain competitive remedies. That is a fair amendment. It is unlikely to be abused because we are talking about long term customers of the railway.

We also need to allow shippers to jointly apply. Right now they can apply only individually for final offers of arbitration on a common matter. If there are disputes, they could be grouped together and thus would not be drawn out. A ruling could be received fairly quickly.

We need to give the agency the authority to establish charges or the associated terms and conditions that would apply to shippers for the movement of traffic or incidental services.

This also will allow for the suspension of any final offer arbitration process if both parties consent to pursue mediation.

Again, these are reasonable requests that are being brought forward to actually help address these longstanding concerns.

It would also permit the CTA upon the complaint of 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 establish new charges or terms and conditions if it finds those in the tariff to be unreasonable.

Once again, I think these are all fairly straightforward and reasonable.

This would increase the notice period for augmentation in rates for the movement of traffic from 20 to 30 days to ensure that the shippers receive adequate notice of rate increases. Once again, when we are dealing with large bulk transport we need to have some sense of security and some sense of stability in terms of pricing if we are dealing with products.

It would require the railways to publish a list of rail sidings available for the grain producer carloading and to give 60 days' notice before removing such sidings from operation. Once again, if we are going to take out some of that infrastructure that people are dependent on, we have to give the shippers some advance notice so they can begin to make other arrangements.

We also need to ensure that the abandonment and transfer provisions apply to lines that are transferred to provincial short lines and subsequently revert to a federal railway, including the obligation to honour contracts with public passenger service providers.

This is a fairly straightforward and fairly technical bill in which the government is trying to bring in these amendments. As I said, it is to give our shippers some sense of fairness in a market that does not allow very large scale competition. We all know that markets with more competition are generally ones that will favour larger investment and larger use, but certainly with railway, because of the incredible cost of infrastructure and also the history, we have the two big giants. We have always had the two big giants, augmented by many smaller lines and by provincial lines.

In my own region, the Ontario Northland is a provincial line that runs from Hearst. It used to be by rail but now it is by bus. From the Kapuskasing-Cochrane region and actually from Moose Factory the train line runs provincially down south to North Bay, and from North Bay south it becomes one of the CN lines. We are still moving provincial goods along that line. It is still a provincial railway.

It is of paramount importance in our region, because right now if we want to move out any of the goods from the mines, in particular the sulphuric acid cars that are coming out of the Horne smelter in Rouyn-Noranda and the Kidd Creek smelter in Timmins, it is superior by far to move it on the train lines.

These are massive bulk operations, so the shippers need to have some security. As well, we are moving out copper concentrates and zinc concentrates from the Horne smelter in Noranda and also from the Kidd smelter in Timmins. We need some stability in regard to knowing the pricing. As for what is being forwarded in this legislation, even though it is coming in on a provincial line, as I can see from my own region and our dependence on railway traffic, these changes are practical.

Certainly in western Canada the rail lines play an incredible role in the movement of goods and people. As we know, when we are driving across the country and we get to one of those rail sidings when the grain cars are coming along, we can pretty much read from one end of the newspaper to the other before the train has passed.

I am always thrilled to see those train cars come along. I see them coming to the port in Thunder Bay where they end the journey so the freight can then travel by boat. When we see how much can be transferred on those lines, it is truly impressive.

Certainly with the whole move we have seen to the container shipping system, which has actually revolutionized transportation and commercial dealings around the world, we in Canada need to make sure that our railways are in the game and are there with prices that shippers can actually trust so they choose the railway as opposed to simply putting their product onto our overstretched highways.

Whether it is provincial or federal, the investment in highways just has not kept up. In so much of our country, as I have said, we are dealing with two lanes of traffic, except on the busy 401 stretch. Having that massive amount of truck traffic has not been a bonus for our economy. It is costly to the taxpayer because of the impact on roads. We do have a railway system, but we need to ensure that system.

Before I close I will speak a little bit about the whole vision of a national infrastructure plan. As I said, the government is focused on the terminal ports and the gateways for trade, but in order to make trade work in this country we need a vision that says infrastructure and transportation go hand-in-hand. Whether it is the port or whether it is the highway, the two lanes of thin traffic that has to cut through the Canadian Shield carrying the goods, that has to be part of the equation as well.

Infrastructure also goes all the way down to a vision for our municipalities. They are increasingly having to carry the burden of maintaining infrastructure that used to be provincial or federal.

In my little community of Iroquois Falls over 30 kilometres of public highways has just been downloaded and called local roads. There is no base in the taxation to cover off the cost of those roads so they eventually start to deteriorate. It makes it very difficult to attract business to regions when the fundamental infrastructure, whether it is roads, bridges or sewage, begins to deteriorate because the ratepayers, average citizens, are having to pay for it on their water bill or municipal housing bill because there is no provincial or federal commitment to infrastructure.

We have to make infrastructure a priority in the House. The infrastructure deficit being felt across our municipalities right now is affecting regions of the country to maintain a competitive ability to attract business.

I had wanted to speak about infrastructure because railway is part of infrastructure and I will end on that and say that we are very interested in Bill C-8. We think it is a practical bill and the kind of bill that has been brought forward because there have been consultations with many of the shipping and trade associations, including the Canadian Wheat Board. I know that might upset some of my Conservative colleagues but the Canadian Wheat Board certainly felt that there were issues dealing with grain transportation and fairness of price.

We spoke with the Forest Products Association of Canada. We are hauling logs through northern Ontario. I know that in northern Canada rail plays a big part in hauling our wood, our finished products and our logs.

The Canadian Canola Growers Association is in support of this along with the Mining Association of Canada. If are going to do large scale mineral development in this country, at the end of the day we have to ship the products out and rail, by far, is the vehicle of choice to move concentrates or finished products out of mining operations to the ports, particularly the ports on the Pacific right now because the Chinese boom has certainly fuelled a major boom in base metals. We know that is a fact in my region of Sudbury as well as Rouyn-Noranda and Timmins. The railway plays an incredible role in the movement of base metals to serve the expansion in the Far East.

The Western Grain Elevator Association has shown its support for the bill along with Pulse Canada and the Inland Terminal Association of Canada.

At the end of the day, we are talking about some practical amendments to the Transportation Act to ensure fairness of price and that the overall dominance of the market by the two big giants does not come at the expense of the people who need to be able to ship products, who need certainty in price so that they can make long term planning decisions and investments in the economy that will help it continue to grow in the 21st century.

I look forward to seeing the hon. Speaker tonight at the Robbie Burns dinner. I know he apparently has some Scottish background. As one who also has a Scottish background, I wish him all the best, two days after Robbie Burns day.

The House resumed 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.

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

Mr. Speaker, I am pleased to speak to Bill C-8, An Act to amend the Canada Transportation Act (railway transportation), on behalf of the Bloc Québécois. I would say at the outset that our party will be supporting this bill. Why? Because this bill, which has been discussed, amended, reworked and adjusted in committee, will provide a way to resolve a dispute that has been going on for a number of years between shippers and the railway companies—or at least, so we hope.

In recent years a whole series of tariffs has developed to counteract the Canada Transportation Act, which allowed for an arbitration system for disputes about the costs of railway transportation. That was permitted by the Act. Over the years, however, the railway companies have added what they called related charges to the shipping bill, charges that included parking, transshipment, fuel price increases and customs clearance. In other words, there is a whole list of charges that shippers had no say about; they had to pay.

Obviously, with respect to this dispute, Transport Canada had asked both the shipping industry and the railway industry to come to an agreement. For several years, talks were held, but no agreement between the shippers and the railway companies was possible.

It is important to say this. The railway lobby has been much in evidence throughout this lengthy process. They have lobbied based on the claim that this would destabilize the entire market. It is time for this situation to end, given that shippers are having to deal with only one transporter, as is the case for a number of companies located in remote regions, in Quebec and elsewhere in Canada, where the only really decent and safe way to ship goods is still the railways.

The Bloc Québécois has always come to the defence of railways. With globalization moving increasingly toward combating greenhouse gases, this mode of transportation is a good way of contributing to not polluting the way road transportation would do, for example. So the more preference we give to railways, the better it will be for the environment.

That is why, in our view, it is important for this dispute to be resolved. But will this settle the entire matter? Let us look at clause 3 of this bill, which will amend subsection 120.1(1) of the Act to read as follows:

If, on complaint in writing to the Agency by a shipper who is subject to any charges and associated terms and conditions for the movement of traffic or for the provision of incidental services that are found in a tariff that applies to more than one shipper other than a tariff referred to in subsection 165(3), the Agency finds that the charges or associated terms and conditions are unreasonable, the Agency may, by order, establish new charges or associated terms and conditions.

This is exactly what I said before. It would be possible to apply the agency’s decisions to any related tariff that did not directly impose transportation charges. The issue here is therefore the railway industry’s bad habit of billing for all the other charges so that they were not applied to transportation charges, which were subject to arbitration by the Canadian Transportation Agency.

Second, this bill will allow several shippers to file a joint appeal of charges. That is the objective. This bill will affect our forestry and manufacturing industries primarily in their role as shippers. These sectors are experiencing very difficult times. The Bloc Québécois is the only real party in this House to defend the manufacturing and forestry sectors. The Conservative government did not come to their defence. Rather it presented an assistance plan contingent on the adoption of a budget, without taking into account the gloom that persists in Quebec regions. This government pays no attention to the interests of citizens or of the real public, but focuses on being elected.

The Conservative members from Quebec prefer to rise and defend the Conservative Party rather than the interests of their citizens. That is the choice of the Conservative members from Quebec, but not of the Bloc Québécois members. We will never hesitate to stand up in this House to defend the interests of citizens who are losing their jobs. It is not right to invest in the military, nuclear and oil sectors and to not help those losing their jobs, especially in the forestry and manufacturing sectors. That is why, once again, we will rise today to defend the interests of the manufacturing and forestry sectors.

This is not going to solve their problems. Bill C-8 will not solve all the problems today. However, these industries have been afflicted by this irritant for many years. For too long, Transport Canada allowed businesses to do what they wanted. It is time to put an end to all tariff systems other than the one tied to transportation costs. That is what we are trying to do today by permitting the arbitration by the Canadian Transportation Agency of disputes concerning all these other charges. It is important.

No bill has ever had such universal support from the shipping industry. Quebec businesses were invited to appear before the committee, and they were represented by national associations, because there truly was unanimous agreement. The request was not to touch the bill as tabled, apart from a few amendments made in committee following debate.

So this bill represents a request from the entire shipping industry in Quebec and Canada. Obviously, part of this bill directly affects western Canada and railway transportation.

The Bloc Québécois will agree that disputes should be settled on a national scale. We are pleased to support this bill.

Once again, it is often the small details that steadily move things along. Once we have passed the bill at third reading, as we are in the process of doing, and it receives royal assent—soon, we hope—this little dispute over the other charges can be settled.

I repeat that this bill also addresses another issue. Several shippers will be able to submit a matter jointly to save money. Obviously, as a result, in issuing the order in accordance with the bill, the agency must take into account the following factors: the objective of the charges or associated terms and conditions; the industry practice in setting the charges or associated terms and conditions; in the case of a complaint relating to the provision of any incidental service, the existence of an effective, adequate and competitive alternative to the provision of that service; and any other factor that the agency considers relevant.

The agency has full latitude to take whatever measures it may deem necessary in order to settle the dispute.

For the railway companies, the bill aims to strike a balance. The proposed paragraph 120.1(4) provides that:

Any charges or associated terms and conditions established by the Agency shall be commercially fair and reasonable to the shippers who are subject to them as well as to the railway company that issued the tariff containing them.

Once the agency hands down its decision, the railway company shall vary its tariff accordingly. This is an obligation of result. It is very important that this be done as soon as the agency reaches its decision.

Why this dispute resolution? It is important that the railway companies also understand that the forestry and manufacturing sectors in Quebec and Ontario are on the verge of economic disaster. In the finance minister's economic statement, the picture of the forestry and manufacturing industries showed that they had been in a recession in Quebec and Ontario for two quarters.

Naturally, economists agree on this. When the situation facing the forestry and manufacturing industry is blurred by adding natural resources, which then includes oil company revenues, the problem is concealed.

That is what the Conservative government ultimately did. It did so in such a terrible way, by trying to suggest that the problem facing the forestry and manufacturing industry in Canada and Quebec was ultimately the same everywhere.

In distributing its billion dollars, the government did so per capita, that is, of course, per resident. With a minimum of $10 million per resident from the outset, Alberta has more money than Quebec to resolve the forestry and manufacturing crisis.

Once again, we denounce this Conservative approach, this manner of always acting in the interests of a few, rather than in the interests of the voters and citizens of Quebec.

[Pat Martin, NDP, Winnipeg Centre, MB]

Thank you, Mr. Speaker, for the opportunity, on behalf of the NDP caucus, to enter into the debate on Bill C-8, An Act to amend the Canada Transportation Act as it pertains to railways. We should note that it was known as Bill C-58 in the previous Parliament.

On behalf of my colleague from Windsor West, I would like to announce today that we are in support of Bill C-8. We will be supporting it at this stage of debate because we feel that it addresses many of the valid concerns that railway shippers have over the current conditions of the Canada Transportation Act which allow for the potential abuse of market powers by the railways.

We should point out that it is the view of the NDP at least that at the present time the Canadian Pacific Railway and the Canadian National Railway have a virtual duopoly on shipping prices. It is a new word to me. It is not a monopoly but a duopoly. Their financial stranglehold, as it were, is choking Canadian shippers who rely on the rail system to transfer their products from the farm or the mine to the market. Currently, for those producers, transportation costs are their second or third largest cost for these bulk shippers. Under this duopolistic regime, these shippers have no alternative way to transport their products.

Our point is, even though there are more than 30 federally regulated railways in Canada, something I did not know until today, many rail shippers are in fact captive shippers. That is, only a single railway company offers direct service to their area. For these shippers, the rail transportation environment is not naturally competitive and in the absence of adequate legislative measures, a railway company could take advantage of its position as a monopolist in the region. That is why we are welcoming these legislative measures that will afford some protection to these captive shippers.

A monopolist railway would have the incentive to offer lower levels of service at higher prices, we believe, than it would under more competitive market conditions. We welcome this attention to the rail transportation system, if I might, because it brings to light perhaps a larger issue facing Canadians in that Canada as a nation made a strategic mistake 20 or perhaps 30 years ago when it chose to start dismantling our rail transportation system and putting the emphasis of freight on trucks.

If there is anything I have heard you, personally, Mr. Speaker, speak about in the House of Commons, it is the fact that for all kinds of good reasons, for the environment, for the cost factor, to save on fuel, we should all be trying to get the freight off the trucks and put it back on the rails to the largest extent possible so that most of its transportation, most of the distance that is shipped is shipped by rail. That will take a shift in mindset for Canadians. It will take an analysis of our whole transportation infrastructure in this country.

I welcome the opportunity to debate Bill C-8 today on the rail transportation system as it pertains to the Canada Transportation Act, but I also welcome and invite other members of Parliament to join in what could be a very exciting period and opportunity as we revisit the whole transportation infrastructure as an integrated network of transportation that will meet the needs of the 21st century.

In that light, in that context, I draw the attention of members of the House to a report that was very quietly released just a couple of days ago without much fanfare. Hardly anybody noticed, it would seem, and certainly the media did not notice. It is called the “Asia-Pacific Gateway and Corridor Initiative”, put out on behalf of or commissioned by the current Minister of International Trade and Minister for the Pacific Gateway.

In terms of transportation, this is the most important piece of work that I have come across in my 11 years as a member of Parliament because it finally comes to grips with the notion that we made a policy mistake a number of years ago when we got away from railroads and started tearing up the tracks to smaller communities.

God knows that with the experience in western Canada, we have not been nation building. We have been tearing up the tracks. We have been abandoning communities in terms of access to rail transportation.

I should recognize and again credit the authors of this brief 40 page report, one of whom, Mr. Arthur Defehr, is from Winnipeg and the owner of Palliser Furniture, which I believe is in your riding, Mr. Speaker, Mr. Jeff Burghardt and Mr. Richard Turner. This blue chip panel travelled the world and looked at efficient transportation networks, with an emphasis on Asia and on the revolution that occurred in transportation, shipping and freight, with the shipping containers and the new urgent need for Canada to get on board with handling these containers in a more effective, integrated approach.

The Asia-Pacific gateway is obviously looking at the ports and the terminals, but this report reminds us of the need and the potential for inland ports, for distribution terminals far away from the congestion of Vancouver and Prince Rupert. Perhaps, and I put this to the House as a member of Parliament from Winnipeg, a place like Winnipeg would be the ideal location for a great inland port.

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

Mr. Speaker, I am resuming a speech started on December 10, 2007. As a result of the interruption, I still have 10 minutes for the rest of my presentation.

This bill is currently in third reading. Its primary objective is to clarify the Canadian Transportation Act and strengthen the provisions that currently protect shippers against possible abuses of market power by the railway companies. It is aimed primarily at western Canada's farmers and grain transportation.

Bill C-8 tries, therefore, to strike a better balance of power between the railway companies and the people that produce and ship products, including grain producers, who do not own the rails but have to send their hopper cars all across Canada. These people feel oppressed by the railway companies.

The purpose of the bill is to strike a balance. The proposed changes respond to the concerns expressed by shippers, especially grain producers in western Canada, about railway prices and services, while ensuring that the railway companies continue to have a stable regulatory environment.

In addition to what I said last December, I would like to tell the House about a meeting I had with a francophone Albertan. In what is quite a rarity, we were treated to a fine presentation in French by the Alberta Canola Producers Commission—a commission that does not even have a French name. We were sympathetic to what it had to say because it represents 52,000 canola producers throughout western Canada.

What they want mostly from the bill—and this reflects the Bloc’s analysis as well—is the repeal of the requirement that the Canadian Transportation Agency must be satisfied that a shipper would suffer substantial commercial harm if relief is not granted. The provisions to be repealed prevent shippers from getting the relief currently provided by the act, such as the price of competing lines, which has not proved very effective.

The second point is to increase the amount of notice required for tariff changes to 30 days. Shippers will therefore have another 10 days to plan for increases, which is a more reasonable amount of time.

The third point would allow the Canadian Transportation Agency, by order, to establish new charges and associated terms and conditions on a railway company that wants to impose unreasonable charges or associated terms on shippers. Currently, shippers cannot challenge penalties or unreasonable charges for related services and associated terms and conditions when these costs are set out in a tariff. Demurrage charges are an example of penalties, while the weighing of loaded railway cars is an example of related service. Increasingly higher fuel surcharges that are arbitrarily imposed are also a concern.

The fourth point would establish criteria for the agency to determine the reasonableness of the conditions which, among other things, must be commercially fair to both the shipper and the railway company.

The fifth point seeks to set conditions for the return of railway lines to federally regulated railway companies.

The sixth point deals with the publication on the Internet of a list of available sidings where cars can be loaded.

The seventh point would add provisions to the arbitration clause, to allow parties to refer disputes to a mediator. The grain transportation sector must have a more balanced and equitable dispute settlement system.

The eighth point would authorize the shippers to join together to seek arbitration when they are not satisfied with the proposed tariff changes of a railway company. Broadening the scope of these provisions to allow shippers to file a joint complaint will help them spread arbitration costs. This is one issue that was raised, namely, that a shipper could not hold his own against railway companies when the time came to produce evidence before the Canadian Transportation Agency.

The ninth point, which is just as important, would institute an independent review of railway services.

A review is provided for and has to start within 30 days of the legislation taking effect. This review is vital to the canola industry, because it will be an opportunity to have service issues currently facing shippers subjected to an independent assessment and should produce recommendations that strike a balance between the responsibilities of shippers and those of carriers when service problems arise.

In a nutshell, we have also heard evidence from railway companies, which are totally in favour of a review that will promote a factual analysis of occasional and related costs incurred by grain carriers. These issues are not being addressed simply in terms of intentions or ideas. That is another important aspect of this bill.

I also wanted to point out that the Bloc Québécois supports the bill because it seeks to give powers under the Canada Transportation Act.

It is a good thing that we act on this because, in the past, we have seen railway lines abandoned. There is a need to regulate that to some extent now. Line owners operate them as they please, often hiking prices without notice.

One can understand from all these facts that the Bloc Québécois is very sensitive to the plight of grain producers from the Prairies and western Canada. We are also—there is no doubt about that—sensitive to the plight of Quebec producers. This is why we stand firmly in support of supply management in Quebec.

If the Conservative government defended the interests of Quebec producers with respect to supply management as strongly as it is currently defending those of grain carriers, that would make a great difference and would reassure our producers in Quebec.

I would like to remind the House of one thing: the Bloc Québécois makes no distinction between western producers and Quebec producers. Whenever we feel that the public in general is being taken advantage of by the private sector, we do not hesitate to step in and fully and constructively play our role as the opposition with the government.

Therefore, the Bloc Québécois will certainly be supporting this bill at third reading.