Bill C-10 (Historical)

An Act to amend the Air Canada Public Participation Act and to provide for certain other measures

This enactment amends the Air Canada Public Participation Act to provide that Air Canada’s articles of continuance contain a requirement that it carry out aircraft maintenance activities in Ontario, Quebec and Manitoba and to provide for certain other measures related to that obligation.

Notice of Time Allocation

[Dominic LeBlanc, Liberal, Leader of the Government in the House of Commons]

Mr. Speaker, I am not going to take too much time because I know that my colleagues are looking forward to making comments on the excellent speech by my colleague from Saint-Maurice—Champlain.

I want to advise that an agreement could not be reached under the provisions of Standing Orders 78(1) or 78(2) with respect to the third reading stage of Bill C-10, an act to amend the Air Canada Public Participation Act and to provide for certain other measures.

Under the provisions of Standing Order 78(3), I give notice that a minister of the crown will propose at the next sitting a motion to allot a specific number of days or hours for the consideration and disposal of the proceedings at the said stage.

Third Reading

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, our colleague from Saint-Maurice—Champlain talked about the importance of the jobs in the aerospace sector, including in Quebec, and rightly so. Speaking of facts, when Industry Canada shows the tremendous growth in outsourcing aerospace jobs to Asia, I worry about the fact that the only concrete commitment that we have is the maintenance of new aircraft that have not yet been sold. I do not feel reassured because there is no clear guarantee that the aerospace jobs will stay here. The hon. member has not convinced me. I would like him to elaborate.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Mr. Speaker, I would first like to thank my colleague from Saint-Hyacinthe—Bagot. I have a lot of respect for her work and her commitment.

I come from the Mauricie area. The aerospace industry is not one of our major industries, but I want to tell my colleague that our industry has grown. I have confidence in this bill because of the centres of excellence that we are going to create with the help of quality workers, their skills and their excellence. The Mauricie region is home to the Trois-Rivières airport, which has a maintenance centre for aircraft that come from around the world to be repaired and to get the maintenance services they need.

We created this excellence even in a region like ours, which is not naturally an aviation centre of excellence. We managed to do that. I believe that this measure will result in positive spinoffs for our workers. Even in Mauricie, Quebec, we managed to create a centre of excellence for aircraft maintenance that is the envy of many large cities throughout the world.

[Anthony Housefather, Liberal, Mount Royal, QC]

Mr. Speaker, I would like to commend my colleague from Saint-Maurice—Champlain for his extremely positive speech. I say “extremely positive” because the speech given by the member for Outremont was decidedly negative. I think that is why Canadians chose the Liberal Party in the last election.

The member for Outremont was trying to scare Quebeckers and French Canadians by saying that bilingualism at Air Canada is in question.

I have a question for my colleague. Can he tell us whether there are any changes in the bill that would affect Air Canada's official languages obligations?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Mr. Speaker, I thank my colleague for his question.

I respect the member for Outremont, but I am appalled that he is bringing up issues that are not even in the bill during the debate. As a lawyer, the member for Outremont, like all our other colleagues who worked in the legal profession, will understand that it is not productive to try to sow fear among Canadians by creating mass confusion. Other political parties have long used this kind of divisive politics to pit one community against another.

We have been extremely positive, as my colleague said. I assure my colleagues that this bill in no way affects official languages. As a Quebecker, I can say that comments like those I heard affect us all deeply, because they are an affront to our identity. Every time I travel by air, with Air Canada or with any other Canadian airline, I make sure that I am served in both official languages, in English and in French.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, could my colleague provide a brief comment on what I indicated earlier? We have had different stakeholders, from provinces to union representatives to many other industry representatives, that have ultimately played differing roles in trying to build a consensus. Bill C-10 is just one component of a bigger picture in the importance our aerospace industry. The passage of the bill would be a healthy thing for the long-term best interests of the aerospace industry.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Mr. Speaker, I have heard my colleagues, and I have respect for all my colleagues' views. The purpose of having a Parliament is to listen to each other. I have heard some of them criticizing that we call it modernization. However, having lived across the world, the airline industry, not only in Canada, is subject to pressure from the international sector. We know the aerospace sector is becoming more and more globalized around the world. We talked about the case of the United States having a number of airlines filing for chapter 11.

I was in Europe when Swissair went bankrupt. I saw first-hand how the airline industry had to reshape itself in order to succeed. Today we are giving the means and the tools to Air Canada to compete globally. I think it is the aspiration of every member in the House to see Air Canada be one of the most respected and cherished airlines around the world, one of the most efficient, one that translates our Canadian values.

When I used to live abroad, every Canadian I knew, and many international travellers, were very proud to embark on an Air Canada flight. I am very pleased to see how over the years Air Canada has been able to compete with some of the Asian, Middle Eastern, and U.S. carriers.

What we are talking about today is in the best interests of the workers and of Canada. That is exactly what we will do during our term in government. We will always work for the best interests of the workers of our country.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Mr. Speaker, it is curious to hear the member talk about the best interests of workers when, explicitly, the purpose of this legislation is to change the law to allow Air Canada to no longer employ workers in Canada for the purpose of their maintenance.

We have talked on this side of the House about other measures that the government could take to enhance the competitiveness of the aerospace sector, things like increasing the foreign ownership limit and tying airport improvements fees to specific projects. We have listed them before. I will not list all of them again. However, could the member comment on the many different options for increasing the competitiveness of the sector, which are not only for increasing the competitiveness of companies but also for benefiting workers? Why is the member not looking at some of these other options rather than simply supporting the bill, which provides a windfall gain to one particular company?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Mr. Speaker, I always enjoy listening to the member's speeches. It is by debate that we can come to the best solution.

To the point of his question, there is an assumption on the other side of the House that the bill would inevitably lead to less employment in Canada in the maintenance and refurbishment of airplanes. I am not at all convinced of that. I have given an example of my own riding where we have created a centre of excellence and we refurbish planes coming from the United States. Trois-Rivières is not exactly one of the major urban centres around the world for refurbishing planes. People fly from across the United States to get their planes refurbished and serviced in our community.

I do not understand why, by necessity, the member would assume that a bill like this would necessarily lead to less employment. If we make the right investment in excellence, we will not only attract more work here but we will create and continue to expand our aerospace industry.

Everyone in the House realizes what the aerospace industry has done for our country, even in small non-urban communities like mine. We have benefited greatly by having a centre of excellence which provides highly paid jobs and R and D. It also makes a town like mine proud. The workers in the companies that are based in my own community, who service planes from all over the world, would tell us that the best way to retain jobs is to strive for excellence.

[Todd Doherty, Conservative, Cariboo—Prince George, BC]

Mr. Speaker, it is always a pleasure to rise in the House, especially to talk again about Bill C-10. I have risen a couple of times on this important legislation.

It is curious that the government is picking to run through this so quickly. It is legislation that the Liberals continue to say is for the best interest of Air Canada, to keep Air Canada competitive. They talk about the official opposition and its war on the aerospace industry, because we oppose the bill being rushed through.

The Liberals talk about their aerospace strategy but, really, the floor on the number of jobs in each province that Bill C-10 would impact is one, or it guarantees is one. It does not specify the nature of work that has to be done, but only that line maintenance could and probably does apply. Therefore, it is interesting that they talk about their aerospace strategy.

It should also be noted that the Liberals talk a lot about the centres of excellence that Air Canada will be building. It is critical for members of the House and for those Canadians who are listening to understand that if the law is changed today, there will be no incentive for Air Canada to remain at the table to negotiate with the Governments of Quebec and Manitoba, whether for this legislation or for the centres of excellence and the jobs associated with those. However, the government rides in on its white horse, saving the day for the aerospace industry.

The deputy premier of Manitoba was equally clear recently when she said:

The federal government's approach to Bill C-10 simply put is jumping the gun. Bill C-10 is being rushed through the process before the necessary specific investments and binding commitments by the federal government and Air Canada have been secured.

It is interesting that the member for Winnipeg North said that the Conservative Party did nothing. Again, the Liberals have ridden in on their white horse and are saving the day for the aerospace industry.

It is interesting again that, if their contention to saving the day is resolving litigation between Air Canada, Quebec, and Manitoba, then is Parliament stepping in and effectively siding with Air Canada in a dispute, with the legislation before us, after Quebec and Manitoba were in the court fighting Air Canada? Is it sound public policy? I guess we know what lengths the Liberal Party will go to help out its friends.

I sat through every debate. Obviously, with my background, I am keenly interested in this. Again, there has been a great healthy debate from all sides, but the language the government side is using is that this would give Air Canada a competitive advantage on an ever-changing global environment.

I think we mentioned this before, and I will go into some detail. The Parliamentary Secretary to the Minister of Transport did her best to talk about airline, airport, and aviation economics. Therefore, I would remind the House again about my background with that and some of the challenges that we face, given everything Air Canada has been granted over time.

I should probably have started off by saying that I am absolutely a fan of Air Canada. We have relatives and friends who are employed by Air Canada. However, this is about keeping and protecting jobs in Canada, and nothing else.

The government would like us and other Canadians to think that this is an attack on the aerospace sector, the 170,000 aerospace jobs throughout Canada, because fundamentally we are against Bill C-10 and what it would open up in shipping jobs overseas.

The proposed amendments to the 1988 Air Canada Public Participation Act means that the jobs of 3,000 Canadians who provide aircraft maintenance would and could be affected. Under the amendment, Canada would still be required to do some maintenance work in each of the three provinces, but as I said earlier, it is one job. It could be one engine overhaul or one oil job, and that is it.

Air Canada is allowed to change the type or volume of any or all of those activities in each of those provinces. As well, it is also allowed to adjust the level of employment in each and all of those areas. It will be free to dictate how many people will be employed by these centres, and what work they will do.

We continue to ask the question, why the rush? Today, for the very first time, the parliamentary secretary to the Minister of Transport mentioned Mirabel. We also heard that there will be other legislation in place that guarantees that these jobs will not be lost.

Why the rush? Why can we not have an honest debate? Why can we not have an honest discussion? The government continues to use the excuse that the legislation will make Air Canada more competitive. We all agree that it is time Air Canada becomes a private sector company that is not supported by taxpayers, that is competitive on the global stage, and it is.

We also agree that all of Canada's aviation, aerospace, and airlines should receive the same type of treatment. We should create an environment where Canada, as a whole, can compete, can be competitive, regardless of whether it is Air Canada or Pacific Coastal. We want a level playing field, and it does not have to come at the expense of high-quality, well-paying Canadian jobs.

I spent 20 years in aviation. I am aware, first-hand, of the challenges that our Canadian aviation sector faces, airport, airline, and regulatory impediments.

Air Canada, in 1988, inherited 109 aircraft. It came hat-in-hand to the Government of Canada and asked for some support, some help. It is the largest airline in the country, and it is an important international player in the sector. It has 28,000 employees. It goes to 180 destinations worldwide on five continents: 60 Canadian, 49 U.S., 72 international.

It is because of the government support of Air Canada over the years, and the taxpayer support over the years, that Air Canada is a global, international player, that it is one of the top carriers in the world. Today, Air Canada is the largest tenant at nearly every major airport in this country, with the exception of Calgary and Billy Bishop Toronto City Airport, which we have debated before. Air Canada has significant influence over each airport's operations and access to the best landing slots in all of our major airports. It has that competitive advantage.

We welcomed the original intent of the Air Canada Public Participation Act when it was introduced in 1988, but let us remember why that act was put in place. The act put in place clear conditions to ensure that all of the support Air Canada received from the Government of Canada to turn it into a profitable crown corporation was not lost. It was to protect Canadian taxpayers.

There were four conditions. Air Canada would be subject to the Official Languages Act. It would maintain its headquarters in Montreal. Seventy-five per cent of its voting shares had to be held by Canadians, and finally, Air Canada had to maintain operational and overhaul centres in the city of Winnipeg, the Montreal urban community, and the city of Mississauga.

Given all of those recommendations, all of those parts of that legislation, the government picked one to change, to overhaul. Even the Canada transportation review released earlier this year, in February, the Emerson report, cited 60 recommendations, and it picked one.

Again, why the rush? While it is exactly unclear what level of benefit this legislative change will give Air Canada, one thing is clear and that is the intended change will make it possible for the carrier to move thousands of jobs from Canada to other jurisdictions. Today, the government informed the House that it is considering legislation that will protect those jobs.

Why now? Why, at this point, is the government bringing that up? It could have brought it up earlier on.

If we are talking about giving further competitive advantages to one of our national carriers, why do we not look at the industry as a whole? If Air Canada, after being afforded all of these competitive advantages previously and the protection of successive governments, is still having difficulties remaining competitive, it might be a sign that our national aviation industry needs a little overhauling.

Let me talk about some of the challenges that our aviation industry is facing as a whole. Air transport is a critical economic and social infrastructure. It provides access to trade and investment; connects people to jobs, friends, and family; and delivers vital goods and services to remote areas, such as medevac and critical life support. Geography, population size, and the environmental conditions in Canada increase the operational costs of air transport compared to other jurisdictions. While being a distinct advantage for some, it is a disadvantage for other carriers in Canada.

The Canadian passenger market is relatively mature and we have had some significant gains over the years. We are a market of about 122 million to 125 million emplaned and deplaned passengers. It pales in comparison to the emerging and developing markets around the world. In some measure, it is due to the very same policies developed for the industrial and economic environment of the 1990s. Simply put, the very same policies that were designed to protect our industry are now the ones hindering it.

Most of Canada's domestic air services are provided by Air Canada and WestJet nationally. We have a small number of regional and local air carriers that help serve the underserved market. Some of these small tier-three airlines are aligned with our national carriers and they allow for better customer service and connectivity. In the 1990s, Canada saw the Southwest Airlines low-cost model introduced by WestJet. This came at a time when consumers and communities were held hostage by predatory pricing by Canada's two major carriers at the time, Canadian and Air Canada.

Smaller communities throughout Canada and Canada's north are served by regional local carriers. Canada's main charter carriers are Transat and Sunwing, and those are focused primarily on seasonal vacation destinations. WestJet's entrance into the Canadian market in the early 1990s created excitement by offering low-cost travel. Actually, it allowed Canadians to experience air travel, some for the very first time. There was a time when air travel was only for the elite. It was considered glamorous and accessible only to those who could afford it. At one time, the cost of a round-trip ticket into my riding of Cariboo—Prince George from Vancouver was in the thousands of dollars; now it is in the hundreds. With the entrance of low-cost carriers and competition, air travel became easily afforded, and this stimulated market growth.

Both Air Canada and WestJet have now introduced lower costs, low fare, or charter subsidiaries such as Rouge and Encore. This has stimulated the growth in a number of markets. As we speak, there are currently a number of start-up low-cost carriers at various stages of financing that are expected to enter the market in the short term. This will ultimately lead to a price competition with existing carriers. For a time, our national carriers will react with greater seat sales and maybe even a few new routes. However, ultimately as the past will dictate, only new entrants with deep pockets will survive.

All this is to say that maybe it is time to reconsider policies that served us well when the Canadian aviation industry needed protection to flourish, but now impair our competitiveness. Of course, such protectionism comes at a cost that is largely borne by Canadian consumers who pay relatively high airfares and by a Canadian travel and tourism sector, which, also due to higher costs, has been losing market share for over a decade, unable to compete or go head to head with the big boys because the deck is stacked against them. Airline start-ups and failures are frequent, and ultimately the ones that suffer the most are the communities and ultimately the consumer.

I want to talk a bit about airports. The Conference Board of Canada estimates that Canadian airports in 2012 accounted for $4.3 billion in real GDP, but had a total economic footprint of $12 billion. Generating almost 63,000 jobs and contributing over $3 billion in federal and regional taxes, Canada's airports are vital to the success of the Canadian economy. They are key gateways for inbound and outbound tourism, business, and personal travel. Domestic, commerce, and international trade are all predicated on access to our Canadian public.

Canada is blessed with a strategic geographic location. We are at the crossroads of great circle routes between Asia, Europe, and the Americas. We have this competitive advantage that we as a nation have never fully taken advantage of. Our competition has successfully negated this competitive advantage with integrated policies and programs aimed at stimulating inbound tourism and facilitating connecting traffic through its global hubs, essentially overstepping, or to use an aviation term, overflying Canada.

Canada's airports face increasingly aggressive competition, competition from countries that have recognized the importance of air transportation as a driver of economic growth. Our neighbouring U.S. counterparts market directly to and easily access a large portion of Canada's U.S. transborder and international travel market. Our cargoes are shipped to U.S. ports and airports and then trucked across the line.

Canadian airports also compete with each other for the allocation of limited carrier capacity. Our regional airports and communities are oftentimes pitted against one another in competition for airline service. As mentioned during the Billy Bishop debate, Canadian airports also face challenging times, along with changing aircraft capacity, and a continued focus on environmental issues, such as noise and residential encroachment.

With the introduction of the national airports policy, a new framework was defined in relation to the federal government's role in aviation. This happened in the nineties. NAS airports, composed of the 26 airports across Canada that were deemed as critical links for our country, were deemed essential to Canada's air transport system. The airports served 94% of the air traffic in Canada. They were transferred under lease to the airport authorities, and in some cases, the municipalities. The infrastructure at many of these airports, if not all, was antiquated and in need of attention.

Through the transfer negotiations, reinvestment monies were given with the expectation that these airports were to do everything in their power to be self-sufficient. Airports have very few revenue-generation streams. With the transfer of airports and the new-found independence also came the realization that user-pay systems were needed. Airport improvement fees became the norm, and today we have airports that are incredible examples of the NAS transfer. We also have airports that have struggled to remain competitive and viable.

There are a number of things that we should be talking about with respect to our aviation policies and aerospace industry. For example, airport rents can represent up to 30% of airport operating budgets, far more than what would be expected in dividends and income tax from private, for-profit airports, such as those in Europe. Canada collects $300 million from airports across Canada, and they reinvest $50 million. Our NAV and security fees are among the highest in the industry. If we really want to become competitive, we need to fully integrate parts of our local transportation system. We need to look at aligning our foreign trade policy and our free trade policy with our air policy. We need to look at our tourism policies and align them with our trade policies.

As we speak, we have carriers and airports that are struggling. The current government wants to give one carrier a competitive advantage. It continues to stand before us and say that it will give Air Canada a competitive advantage. If it wants to show true leadership, it could align our policies and promotions. It could stimulate air travel to and from Canada. It could look holistically at our tourism, aviation, and trade policies and bring them all into alignment so that carriers, regardless of whether it is Air Canada, WestJet, or Pacific Coastal, to name a few, or the dozens of Canadian air carriers, can remain competitive.

This is low-hanging fruit, and the government is rushing it to look after its Liberal friends when really what it could be doing is taking a step back and re-evaluating Canada's aviation system as a whole. This is not an attack on the aerospace sector, as the government would like Canadians to believe, this is giving one company, one organization, a competitive advantage over others.

[Adam Vaughan, Liberal, Parliamentary Secretary to the Prime Minister (Intergovernmental Affairs)]

Mr. Speaker, it is interesting to listen to my colleague across the way, on two fronts: one, the very strong arguments he made that legislation can in fact protect good-paying jobs; two, that government interaction can generate growth in the employment sector.

However, what I would like him to comment or reflect upon is that the previous Conservative government had carriage of this file. It came to the conclusion—I think I am paraphrasing it correctly—that effectively it agreed with Air Canada that there was no provision to legislate there. It concluded that the legislation was weak and that it was not going to intervene. Effectively, it decided to do nothing.

Was doing nothing on this file preferable to securing the jobs that would be secured through Bill C-14? Was the previous government's position of doing nothing on this file but agreeing with Air Canada on it having no obligation to do any work in any one of these major cities in fact the responsible direction to go, or is this position an advancement, by the fact that it protects real jobs in real cities?

[Todd Doherty, Conservative, Cariboo—Prince George, BC]

Mr. Speaker, again, I am part of this Parliament. The Liberals like to point fingers and say, “It was this government that didn't do this, and these guys didn't do this”. The reality is that they are the ones who have been campaigning on open and transparent ways. Instead, what they are doing is muddying the waters and colluding with third parties. They are ensuring that their friends are looked after.

It was our government that legislated the back-to-work legislation that protected Air Canada in 2012. It was our government that told Air Canada that this was before the courts and that it should be fighting its battles to ensure this was done the right way, that we did not want to interfere with the courts.

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, many of the members who spoke today mentioned that they were lawyers. I am not a lawyer. However, I am very uncomfortable with the idea of voting in favour of a bill that legalizes job losses that are illegal today.

Our colleague talked about his experience in the aerospace sector, and his remarks speak to that.

I would like to know if the member is as uncomfortable as I am about voting in favour of a bill that legalizes job losses that are currently illegal.

[Todd Doherty, Conservative, Cariboo—Prince George, BC]

Mr. Speaker, I was leery about the government before, and I am increasingly leery as we go. The government likes to tell us, “Just trust us. Just hang in there. You'll get it to committee and we'll have the discussion. We'll have a collaborative effort.” All we have seen with the government is that it gets its way, enforces its way, then it gets it to committee and forces the majority anyway.

The reality is that if the Liberals do not like what is being said, they grab their toys and move to the next sandbox. It is like they do not have to listen to what we have to say.

The reality is that the government continues to say, “Just trust us. Trust us.” Well, Canadians are learning what it means to trust it. It is broken promises. Nothing about the government is open and transparent. As a matter of fact, all it is doing are backroom deals and looking after their friends.

I do not trust the government. I am with the hon. member from across the way. There is more and more ambiguity with the government, and more fuzziness. I think we should all be afraid.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Mr. Speaker, I do want to take this opportunity to correct the member for Spadina—Fort York, who wants to say that the previous government did nothing on this and nothing on that. Of course, our previous government made substantial investments in the aerospace sector. One example is the $900 million for the strategic aerospace defence initiative. It was a significant investment, administrated through Industry Canada, that is supporting the aerospace sector.

The current government is not helping the aerospace sector. In fact, it is going in the opposite direction. It is changing the rules in the middle of the game to allow jobs to go out of the country.

I wonder if the member would comment further upon some of the significant changes we made, not just for the aerospace sector, but for all businesses and all workers. It made Canada a more competitive environment to create jobs by lowering business taxes, by increasing our trading relationships.

We did so much for the aerospace sector, for every sector, and now the government is selling out workers by changing rules in the middle of the game.