Safe and Accountable Rail Act

An Act to amend the Canada Transportation Act and the Railway Safety Act

This bill was last introduced in the 41st Parliament, 2nd Session, which ended in August 2015.

Sponsor

Lisa Raitt  Conservative

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment amends the Canada Transportation Act to strengthen the liability and compensation regime for federally regulated railway companies by establishing minimum insurance levels for railway companies and a supplementary, shipper-financed compensation fund to cover damages resulting from railway accidents involving the transportation of certain dangerous goods.
Among other things, the amendments
(a) establish minimum insurance levels for freight railway operations based on the type and volume of goods that are transported;
(b) require the holder of a certificate of fitness to maintain the liability insurance coverage required by that Act, and to notify the Canadian Transportation Agency without delay if its insurance coverage is affected;
(c) establish that a railway company is liable, without proof of fault or negligence, subject to certain defences, for losses, damages, costs and expenses resulting from a railway accident involving crude oil or other designated goods, up to the level of the company’s minimum liability insurance coverage; and
(d) establish a compensation fund in the Accounts of Canada, financed by levies on shippers, to cover the losses, damages, costs and expenses resulting from a railway accident involving crude oil or other designated goods that exceed the minimum liability insurance coverage.
The enactment also amends the Railway Safety Act to, among other things,
(a) allow a province or municipality that incurs costs in responding to a fire that it is of the opinion was the result of a railway company’s railway operations to apply to the Canada Transportation Agency to have those costs reimbursed by the railway company;
(b) clarify the Governor in Council’s power to make regulations respecting the restriction and prevention of access to land on which a line of railway is situated, including by means of fences or signs on that land or on land adjoining it;
(c) authorize a railway safety inspector who is satisfied that there is an immediate threat to the safety or security of railway operations to order a person or company to take any measure that the inspector specifies to mitigate the threat;
(d) authorize the Minister to require, by order, a company, road authority or municipality to follow the procedures or take the corrective measures that the Minister specifies if the Minister considers it necessary in the interests of safe railway operations;
(e) provide the Governor in Council with a regulation-making power regarding the submission of information that is relevant to the safety of railway operations by any person, other than the Minister to any person;
(f) authorize the Minister to order a company that is implementing its safety management system in a manner that risks compromising railway safety to take the necessary corrective measures; and
(g) declare that certain regulations and orders that were made under the Railway Act are deemed to have had effect from the day on which they were made under that Act and that those regulations and orders continue to have effect from that day as if they were made under the Railway Safety Act.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:10 p.m.
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NDP

Djaouida Sellah NDP Saint-Bruno—Saint-Hubert, QC

Mr. Speaker, I would like to thank my colleague and neighbour, the hon. member for Chambly—Borduas. Like me, he is very familiar with the region and the concerns of my constituents.

Obviously, since the Lac-Mégantic tragedy, I have had the opportunity to hold public consultations with my constituents in Saint-Bruno and Saint-Hubert.

As I said in my speech, people and even the municipalities are very concerned. I also had the opportunity to sit on a committee that deals with the prevention of hazardous spills. It is true that the municipalities are very concerned about the fact that they do not know what the rail cars that are passing through such highly populated areas are carrying. People would at least like the municipalities to be informed in advance rather than a year after the fact.

I would like to thank my colleague once again for his relevant question and I hope that the government will give us some answers.

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:10 p.m.
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NDP

Philip Toone NDP Gaspésie—Îles-de-la-Madeleine, QC

Mr. Speaker, I thank my colleague for her presentation. Her riding is a major rail transportation centre in eastern Canada, so we would do well to listen to what she has to say.

Recently, people in the House have raised concerns about the speed of trains in urban and rural areas. I would like to remind everyone that the tank cars involved in the most recent derailments, which took place in northern Ontario and the United States, were travelling at just 24 miles per hour. That did not prevent major oil spills from happening. That is very worrisome.

When it takes six days to put out a fire in a remote part of northern Ontario and we are presented with new criteria allowing municipalities to report safety problems, that is obviously worrisome.

I would like my colleague to comment on derailments in urban areas. Are the new standards reassuring? Does this bill go far enough?

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:10 p.m.
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NDP

Djaouida Sellah NDP Saint-Bruno—Saint-Hubert, QC

Mr. Speaker, I thank my colleague for his excellent question. As I said in my speech, we also have to look at aging infrastructure and companies' responsibility when it comes to train speed.

Unfortunately, train speed is not mentioned anywhere in this bill. All it covers is money for compensation, and when we delve into the details, there is nothing there. The work is half done. It is time to implement the polluter pays principle. When we become the government, we will do a thorough job and talk about all of the factors so that we can prevent instead of cure.

In answer to my colleague, I met with people from CN, and they assured me that the DOT-111 tank cars would be outfitted with bars to make them safe. Unfortunately, the tragedy that happened in Toronto proved that they were not safe.

I hope that work on this will go on.

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:10 p.m.
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Conservative

Mike Wallace Conservative Burlington, ON

Mr. Speaker, it is my honour and pleasure to speak today to Bill C-52, the safe and accountable rail act. In response to the previous question, we on this side agree that this is part of a three-part analysis or attempt to make rail traffic as safe as possible in this country. One pillar, which the parliamentary secretary talked about in his speech earlier today, is prevention. In the second pillar, we need to be ready for response in case there is an emergency. What we are dealing with in Bill C-52 is the part about accountability, making federally regulated rail companies accountable for what they are doing.

In the next few minutes I want to talk about some of the questions that have been asked of the government and of this legislation before it goes to committee so that more discussion can happen, and I know my opposition friends are eager to have witnesses at committee to discuss the bill in more detail.

Why is the government changing the liability and compensation regime for rail? I think it is relatively obvious to all of us in the House, and it was mentioned by every member who has spoken to it today, that the issue of having the government responsible for the safety of Canadians is a number one priority for our government, and it should be. Unfortunately, we have had some very tragic incidents in terms of rail safety issues in this country, such as Lac-Mégantic, Quebec, with the terrible tragedy that happened there in July 2013. I am from Burlington, Ontario, where we have had rail derailments. Unfortunately, the most recent one was a passenger rail issue and people died from that derailment also. However, this discussion is really about product that travels by rail, not people, so this is important to the people of Burlington to have the opportunity to make sure that there is accountability with rail lines and what they are shipping through our neighbourhoods across the country.

When would this new change come into effect? This is basically about changes to the insurance requirements of rail companies, and we are giving them about a year from when it comes into force to get ready for that, which means they will have to make sure their insurance coverage, the accountability aspects, are in place prior to one year from when the bill gets royal assent.

Did we consult stakeholders? Of course we consulted stakeholders. That is important because, whether it was municipalities or railway lines or others affected, there were a couple of rounds of stakeholder outreach in terms of getting feedback on what can be done as the accountability piece. I believe we received feedback from approximately 27 stakeholders on this, from railways, shippers, and local municipalities.

This is important because the issue of rail travel for products and goods is important. Let us face it: it was important in bringing Canada together as a country, and we need to make sure everyone is involved in that discussion of where we are headed in terms of accountability, of being proactive and prepared to respond, and of prevention. That is why the stakeholders played a big role in coming up with what is in the bill.

I think it would be naive to say that everyone agreed on exactly what to do and at what level, but that is why we have consultations. We think that the polluter pay principle should be put forward as the number one tenet of the accountability portion of this.

What does polluter pay mean for rail? It is an important principle that those who cause the damage as a result of their operations would pay for the damage. It is important that it is the company and, in this case, we are adding a fund from shippers. They need to take significant responsibility in terms of the levels of insurance coverage they need. It should not be the taxpayer. That is what the polluter pay principle is, that it is not the general taxpayers' responsibility. It is the government's responsibility to develop the safety standards, to make sure the rail system is safe, but if something does go wrong, it is not the taxpayers' responsibility to cover those costs but the polluter.

These measures of liability should not be new to companies. No company should say it is not its responsibility, it should be the taxpayers' responsibility. At the end of the day, based on the consultations with stakeholders, including the rail companies, we came to an agreement, which we see in Bill C-52, to deal with this.

Let me go over the proposed amendments. They would make all railways hold a minimum level of insurance, which we have heard many times today, based on the risk posed by the type and volume of dangerous goods being moved. It makes sense that if a company is moving non-dangerous goods, its liability should be less, but a company moving dangerous goods, including oil products and others that can cause significant damage, has to have higher liability. It has to have more insurance to cover the costs because if there is an accident, the damage that is done is much more significant with dangerous goods. We came up with a proposal that railways would have to carry higher amounts of insurance for dangerous goods. It is common sense and something that both the public and the railways clearly understand is the railways' responsibility.

There would be an initial requirement for them to hold either $50 million or $125 million in insurance, depending on the type and volume of the dangerous good being carried. That is an initial requirement. Then one year after that, those requirements would double to $100 million and $250 million, respectively. These are the carrying costs that would have to be built into the operational aspects of running a railway. It is important for the railways to have the coverage so that taxpayers would not be on the hook for the cleanup of any damage done from any unfortunate accident. When I say “damage”, it can obviously be both physical damage, property damage, damage to the environment, and, of course, to human life. There have been tragedies in this country where that has happened. We need to make sure that taxpayers are not going to be responsible for that, but the actual railway shipping the goods is responsible.

Another question was with regard to what we think the financial impact would be, particularly on short-line railways. People tend to think about CP and CN, the big railways in Canada, but we would also require the short-line railways to carry the same requirement. It would be part of railways doing business in this country. It would be part of the decision to carry goods and it would be included in this new regime. This would increase their operating costs, there is no doubt about it, but it is much-needed protection for taxpayers as we continue to implement the polluter pay principle, including short-line railways.

Is there insurance available at this level? We are assured that there is. We have had a number of insurance brokers say that it is possible for them to provide that level of insurance and are willing to take the risk. Therefore, they cannot use as an excuse that they cannot get the insurance, which was an issue we needed to resolve to make sure it was available.

I will conclude by saying we have had some tragic rail accidents in my own riding of Burlington in the last number of years. We have also seen across the country other very significant accidents in the railway system, mainly dealing with the shipping of dangerous product. We need to have assurance that the polluter needs to pay and we need to protect the taxpayers, and this is what Bill C-52 would do.

I look forward to the bill going to committee for discussion and back to this House quickly so that we can pass it and make it law, because it would not take effect until a year after it has royal assent. Therefore, we need to get royal assent as soon as possible.

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:25 p.m.
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Conservative

The Acting Speaker Conservative Bruce Stanton

Is the House ready for the question?

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:25 p.m.
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Some hon. members

Question.

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:25 p.m.
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Conservative

The Acting Speaker Conservative Bruce Stanton

The question is on the motion. Is it the pleasure of the House to adopt the motion?

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:25 p.m.
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Some hon. members

Agreed.

Safe and Accountable Rail ActGovernment Orders

March 31st, 2015 / 5:25 p.m.
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Conservative

The Acting Speaker Conservative Bruce Stanton

(Motion agreed to, bill read the second time and referred to a committee)

Accordingly, the bill stands referred to the Standing Committee on Transport, Infrastructure and Communities.

I see the hon. government House leader rising on a point of order.