Bill C-49 (Historical)

Transportation Modernization Act

An Act to amend the Canada Transportation Act and other Acts respecting transportation and to make related and consequential amendments to other Acts

This enactment amends the Canada Transportation Act in respect of air transportation and railway transportation.
With respect to air transportation, it amends the Canada Transportation Act to require the Canadian Transportation Agency to make regulations establishing a new air passenger rights regime and to authorize the Governor in Council to make regulations requiring air carriers and other persons providing services in relation to air transportation to report on different aspects of their performance with respect to passenger experience or quality of service. It amends the definition of Canadian in that Act in order to raise the threshold of voting interests in an air carrier that may be owned and controlled by non-Canadians while retaining its Canadian status, while also establishing specific limits related to such interests. It also amends that Act to create a new process for the review and authorization of arrangements involving two or more transportation undertakings providing air services to take into account considerations respecting competition and broader considerations respecting public interest.
With respect to railway transportation, it amends the Act to, among other things,
(a) provide that the Canadian Transportation Agency will offer information and informal dispute resolution services;
(b) expand the Governor in Council’s powers to make regulations requiring major railway companies to provide to the Minister of Transport and the Agency information relating to rates, service and performance;
(c) repeal provisions of the Act dealing with insolvent railway companies in order to allow the laws of general application respecting bankruptcy and insolvency to apply to those companies;
(d) clarify the factors that must be applied in determining whether railway companies are fulfilling their service obligations;
(e) shorten the period within which a level of service complaint is to be adjudicated by the Agency;
(f) enable shippers to obtain terms in their contracts dealing with amounts to be paid in relation to a failure to comply with conditions related to railway companies’ service obligations;
(g) require the Agency to set the interswitching rate annually;
(h) create a new remedy for shippers who have access to the lines of only one railway company at the point of origin or destination of the movement of traffic in circumstances where interswitching is not available;
(i) change the process for the transfer and discontinuance of railway lines to, among other things, require railway companies to make certain information available to the Minister and the public and establish a remedy for non-compliance with the process;
(j) change provisions respecting the maximum revenue entitlement for the movement of Western grain and require certain railway companies to provide to the Minister and the public information respecting the movement of grain; and
(k) change provisions respecting the final offer arbitration process by, among other things, increasing the maximum amount for the summary process to $2 million and by making a decision of an arbitrator applicable for a period requested by the shipper of up to two years.
It amends the CN Commercialization Act to increase the maximum proportion of voting shares of the Canadian National Railway Company that can be held by any one person to 25%.
It amends the Railway Safety Act to prohibit a railway company from operating railway equipment and a local railway company from operating railway equipment on a railway unless the equipment is fitted with the prescribed recording instruments and the company, in the prescribed manner and circumstances, records the prescribed information using those instruments, collects the information that it records and preserves the information that it collects. This enactment also specifies the circumstances in which the prescribed information that is recorded can be used and communicated by companies, the Minister of Transport and railway safety inspectors.
It amends the Canadian Transportation Accident Investigation and Safety Board Act to allow the use or communication of an on-board recording, as defined in subsection 28(1) of that Act, if that use or communication is expressly authorized under the Aeronautics Act, the National Energy Board Act, the Railway Safety Act or the Canada Shipping Act, 2001.
It amends the Canadian Air Transport Security Authority Act to authorize the Canadian Air Transport Security Authority to enter into agreements for the delivery of screening services on a cost-recovery basis.
It amends the Coasting Trade Act to enable repositioning of empty containers by ships registered in any register. These amendments are conditional on Bill C-30, introduced in the 1st session of the 42nd Parliament and entitled the Canada–European Union Comprehensive Economic and Trade Agreement Implementation Act, receiving royal assent and sections 91 to 94 of that Act coming into force.
It amends the Canada Marine Act to permit port authorities and their wholly-owned subsidiaries to receive loans and loan guarantees from the Canada Infrastructure Bank. These amendments are conditional on Bill C-44, introduced in the 1st session of the 42nd Parliament and entitled the Budget Implementation Act, 2017, No. 1, receiving royal assent.
Finally, it makes related and consequential amendments to the Bankruptcy and Insolvency Act, the Competition Act, the Companies’ Creditors Arrangement Act, the Air Canada Public Participation Act, the Budget Implementation Act, 2009 and the Fair Rail for Grain Farmers Act.

Transportation Modernization Act

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, Bill C-49, the transportation modernization act, does not live up to its name. Many aspects of this bill represent, quite simply, a step backwards.

The government announced its air passenger bill of rights and many other great measures as part of this bill. Not only is the bill of rights not there, but there is nothing to enhance our security. We see this as a missed opportunity. Bill C-49 could have really addressed some of the concerns of Canadians, like the people in Lac-Mégantic, for example, who are still waiting for their bypass. This omnibus bill is problematic in many ways. Unfortunately, once again and as usual, the government is introducing a bill that is far too big to be examined effectively. This omnibus bill includes a lot of measures, and we did not have time to comb through it and discuss it properly.

As well, in the Bloc Québécois, we have fewer rights than members of the other parties in the House. There are not enough of us. We cannot sit on committees, ask questions to experts who come testify, or debate the bill in depth in the House. My comments today will therefore be the only ones by my party on this bill, which will have major repercussions on transportation as a whole and affect many of our laws.

For example, Bill C-49 gives the minister the authority to allow airlines to circumvent the Competition Bureau as he sees fit. That is something. Call a spade a spade: it makes no sense. The government is politicizing a process that currently a judicial one. Come on. We can already see the lobbyists in the minister’s office, and almost lining up one by one to get the green light to act on plans that will reduce competition. We can even imagine that they will obtain that by attending a fundraising cocktail party. It seems to be a model that works.

How can the Minister claim that that is for the good of passengers? We are not fooled. Everyone in the House understands that the government does not want to repeat the situation we saw in 2011 and 2012, when Air Canada and United Continental wanted to coordinate their activities on 19 transborder routes. The Competition Bureau studied the matter and determined that, on 14 of those routes, Air Canada would have far too much market share, which would have greatly reduced competition. The bureau found that a near-monopoly on certain routes would lead to an increase in the rates paid by travellers. Its role is to block that, and that is what it did.

For some routes, like Montreal to Washington or Montreal to Houston, Air Canada and United Continental together would have held the entire market. That is a near-monopoly for sure. In the end, travellers would have paid the increase in ticket prices, which is obviously unfair, because of the rules of trade. The Competition Bureau stated that, if the situation changed, it would be reassessed. That is logical and fair, even though Air Canada did not like the decision, as they wanted to line their pockets.

It was the right decision for travellers and other businesses. The Competition Bureau committed to reassessing the situation if there were any changes. In our opinion, there was therefore no problem. If we do not want that to happen again, why would we want to politicize something that is not politicised? Why give the Minister the authority to circumvent the Competition Bureau? That is what we are asking here, and that is one of the elements that we deplore in Bill C-49.

What purpose will the Competition Bureau and the Competition Tribunal serve if the government gives the minister the authority to circumvent them as he sees fit? We can see that, with the Liberals, the interests of travellers take a back seat to those of big business and party cronies. We can think of Air Canada in particular.

Another thing I would like to mention is foreign ownership. This bill seeks to increase the foreign investment limit for air carriers from 25%, or one-quarter, to 49%, which is basically half. A single corporation or individual cannot own more than 25% of voting shares. The idea here is to give airlines more cash flow and to promote the creation of low-cost carrier services. The government is saying that Canadian air carriers will not be subject to the controlling influence of international investors. That seems fine at first glance, but it creates an opening that allows the government to get its foot in the door and make major changes to the way things are done. We are worried about the future. What will the next step be? The next time a company like Air Canada is on the verge of bankruptcy, will it meet with the minister to say that it wants to be sold to a foreign company?

We already know that the government did not even make Air Canada obey the law when it decided to hand over its maintenance division to Aveos. The government even changed the law after the fact, and announced it the Thursday before an Easter recess. I remember. I was very angry with the transport minister that day. That is why these measures being announced in an omnibus bill is not very reassuring.

It is the same thing when it comes to shipping and coasting trade. The government is taking a number of steps backward in that regard. Bill C-49 will allow ships registered in other countries to reposition empty containers, when currently only Canadian shipowners have that right. Way to go. It is already clear that good jobs will be lost here in Canada and that they will be replaced by cheap foreign labour. Why? The government is putting large foreign corporations ahead of Canadians. That is not even to mention the different training standards, which means that there will not only be fewer jobs here in Canada but that there will also be a decline in the quality of work and a significant increase in the risk of accidents. That is no small thing.

We also have concerns over the part of the bill on transporting products on our river. The bill allows ships registered in European Union countries to transport bulk commodities between the ports of Montreal and Halifax in accordance with the Canada-EU agreement. We are concerned about this announcement and the pilotage legislation that is being discussed. By all accounts it looks to us as though our seaway pilots will no longer be the only ones to navigate the St. Lawrence River. That is one of our major concerns and we see an opening in it. We know that it takes a real expert to navigate our river. It has challenging winding routes and many obstacles.

It is more than our jobs being threatened, but our very safety. The pilots' role is not just to pilot their ship, but also to assess whether the ship that enters the seaway presents an environmental or security risk. Our pilots are also responsible for protecting the public's safety and well-being and can decide that a certain ship is not to enter our river.

The day this role is no longer reserved for seaway pilots is the day we have serious problems. A foreign pilot hired by a foreign country that instructs the pilot to do their job without concern for the environment or safety will have no choice but to follow orders. Why take this chance? This should not be allowed. We have to remain vigilant and speak out against such practices. We are unnecessarily exposing ourselves to huge risks.

There are many elements in this mammoth bill. We do not have the time to study them all, but we would like to draw the attention of the House to the issue of the infrastructure bank. Bill C-49 shows us once again that the federal government is backing away from infrastructure. The bill opens the door wide to the funding of ports and other federal infrastructure by the infrastructure privatization bank. Investors will expect to make a profit, the infrastructure will not be maintained as well, and there will be more charges and fees. Taxpayers will have to pay more. As we have said, with this bank, profits are privatized while losses are socialized. It is too bad that this is in Bill C-49. Once again, the Liberals are helping their friends.

As I said in my introduction, there are many reasons why the Bloc Québécois will be voting against this mammoth bill and we do not have time to cannot mention them all. This bill just does not address Quebeckers' concerns. As I said at the beginning, we were expecting that there would be something for the people of Lac-Mégantic, but there is absolutely nothing. There is no mention of the bypass.

The government has made it a habit to put everything into a single mammoth bill, even though it is breaking an election promise by doing so, and then making sure that we cannot study it thoroughly. That is not the best approach to take and we are against it.

This bill politicizes a process by giving the minister the authority to circumvent the Competition Tribunal. That is a step backwards, a step in the wrong direction. It will contribute to the loss of our businesses. It is the withdrawal of the state for the benefit of the private sector. The government is potentially jeopardizing safety on the St. Lawrence River and sacrificing our jobs for the benefit of foreign companies.

As everyone may have guessed, the Bloc Québécois will be opposing this bill, which we found severely disappointing.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Madam Speaker, I am sure the member often travels by plane or rail. When we get on a plane, we want to know that there are always continuous improvements and that employees are always looking after our safety. That is paramount. On a plane, voice recorders are in the cockpit and data is being collected. All of that is put into place. That does not happen today when it comes to rail safety.

We have seen some tragic incidents take place over this past year, and in prior years. The former government shirked its responsibility to address that safety. We want to ensure that safety is there, by looking to those continuous improvements to ensure data and the voice recordings are captured in the cockpit so we can use it to improve our systems. Therefore, we are bringing safety, modernization, and innovation together to ensure passengers are as safe as they would be in a plane.

We do not want to see any kind of incidents happen with respect to our planes. It is the same with our rail safety. Does the member think this is a good thing? Would that help his community and his citizens?

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I would like to thank the member for Mississauga for his question. First, I would remind him that I travel by bike more than by train or plane. Living in Joliette allows me to get around using active modes of transportation such as walking and cycling.

I must say I find the actions of the Liberal government deplorable. It is the same for almost all issues. If we listen to their speeches, like the one my colleague just gave, we hear fine statements about about train safety and about how we need to do more and what the government is doing is fantastic. In speaking about the budget and finance, the government constantly refers to the middle class. The mini budget repeated that phrase 61 times. In reality, however, both it and the budget contained virtually no measures for the middle class.

In our opinion, the rail safety measures set out in Bill C-49 are completely inadequate. Yes, putting black boxes on locomotives and recording what is done is another step, but people in Quebec just lived through the Lac-Mégantic disaster. The subcontractor must have its own maintenance and monitoring plan. Everything is being left up to the private sector. That is the ultimate in complacency. Rail cars that are no longer up to standard are being used to transport oil. Companies are pressuring employees. We are still dealing with the same toxic combination that previously ended in disaster, and that is shameful. This would have been the time to present a real comprehensive rail safety plan so that a tragedy like that never happens again. The government should have given the people of Lac-Mégantic something, like a rail bypass, and made sure that a situation like that never happens again.

Right now, all we have is a black box for rail passengers who are travelling. The government is out of touch with reality. Once again, we agree with what the Liberal Party is saying, but it is not backing up its words with action. The Liberals cannot govern using only a communications plan.

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

Madam Speaker, I disagree with the member across the way when he tries to give the impression that very little has been done. The minister has indicated a commitment to safety on a number of occasions. Within two years, we brought legislation forward to deal with safety. The member might have wanted to see a lot more done in that area, but having sat in opposition for a number of years, the Harper government did nothing with respect to that. It did not give it the attention necessary.

Therefore, I am a bit surprised that, at the very least, the member would not recognize we are moving in the right direction. There is always room for improvement. In fact, we saw that at the standing committee. A number of opposition amendments were accepted and incorporated into the legislation.

Would the member not agree that the actions of the government to date are far greater than what we witnessed in the previous 10 years under the Harper government? Yes, there is some room for improvement, but at least we have a minister that has currently said that this is of the utmost importance and that we will continue to do what we can to ensure our railways are safe.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, in Quebec, between high school and university, students attend CEGEP, where they take mandatory philosophy classes. In those classes, they learn about sophisms, which are false arguments. One can condemn what the previous government did, but one cannot justify one's own actions on the grounds that those of the other government were worse.

The idea of a black box in passenger trains is a step in the right direction, but it is a very, very small step. I just talked about the Lac-Mégantic tragedy. There is a lot to be done, and we see this as urgent.

My colleague, the Parliamentary Secretary to the Leader of the Government in the House of Commons, said the Liberals are taking a step in the right direction, but the problem is that all of the other elements in this mammoth bill are big steps in the wrong direction. On seaway safety, I am sorry, but this is anything but reassuring, and the situation is getting much worse. On air transportation and the Competition Bureau, why is the minister giving himself the power to just ignore the analysis of transactions? What was wrong with the existing system? I think there has been too much pressure from lobby groups. We need a government that can stand up to businesses and do a better job of ensuring safety and keeping prices down to benefit consumers. Bill C-49 is certainly a step in the right direction in some cases, but it is not nearly enough considering everything that needs to be done.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Madam Speaker, the member across the way made reference to air travel. We know the legislation will enable the minister to provide to all Canadians throughout every region of our country a sense of more accountability from airlines by putting in place rights for air passengers. Constituents who I represent perceive this as a very strong thing. It was part of the election platform we put forward to Canadians. We are fulfilling another commitment.

Would my friend across the way not agree that his constituents would be pleased to know we have forward momentum in dealing with the very important and sensitive matter of ensuring airlines are more accountable for the services they provide? At the least the opportunity is there today for government, after this legislation passes. The opposition can then hold the government and the minister accountable if it feels they have in fact dropped the ball once the regulations are in place.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, we wanted a passenger bill of rights. We wanted passengers rights to be guaranteed, but we wanted that from concrete measures, and not from some window dressing in Bill C-49. It does not even contain the minimum standards.

It seems to me that the government reached a consensus with airlines through some great deal. It is as though the industry were the government's boss and told the government what to do so it would not be angry. It almost seems as though the government is lobbying on behalf of the companies. As for consumers, they need much stronger measures, like the measures found in other countries, such as the United States. We were told we would have a great passenger bill of rights, but when we look more closely at this omnibus bill, we see that it contains very little. It is really disappointing.

[Kellie Leitch, Conservative, Simcoe—Grey, ON]

Madam Speaker, I will be sharing my time with the member for Red Deer—Mountain View.

Bill C-49 has a number of legislative gaps.

This bill is simply an omnibus bill. It is a whole bunch of random ideas tossed together to make one large omnibus bill.

Obviously, the transport minister looked around his department and asked if anyone had anything he or she wanted passed in legislation. He took a list of requests, put them in this bill, and that is what we have. Besides having some loose connections to transportation, there is little common among the items in this bill.

One component of the bill outlines a passenger bill of rights, but there is nothing concrete, no details outlined in the bill, that truly protects passengers. The reception of this bill by passenger rights advocates has been the political equivalent of standing for three hours on the tarmac on a hot summer's day. It is really terrible. That is because the Liberal government is proposing a passenger bill of rights that fails to actually do much for passengers. However, the one thing it would do is allow the Minister of Transport and the Canadian Transportation Agency to set monetary compensation for passengers on their own, with no oversight, yet again another constant theme of the Liberal government.

We all know that the last thing Canadians want is the Liberals having an easier time spending tax dollars. Along those lines, there is more.

The Liberals have also suggested possible increases to the cost of airport security charges.

The Liberals also opened the door to possible increases in security service fees at airports. To top it all off, the minister also gave himself the power to approve or reject risk ventures between airlines, which could diminish the role of the Competition Bureau, which is independent and non partisan.

This is yet another scenario under which the Liberal government has placed more power in the hands of the minister and less power and control in the hands of Canadians, where it rightfully belongs.

Not to be outdone by other omnibus bills, the government has also decided to tackle the issue of grain shipping by rail. I am certain prairie producers, just like those in the riding of the member for Brandon—Souris and other members who represent grain farmers, were delighted when they heard the Liberals would tackle this grain shipping issue. As part of the previous Conservative government that supported the Marketing Freedom for Grain Farmers Act, greater opportunities were provided for grain farmers. The Liberals are not focused on that.

What have the Liberals done? They have proposed major changes to shipping policies that were introduced by a former great minister of agriculture and member of the House, the Hon. Gerry Ritz, and the very capable minister of transport at that time, the member for Milton. By changing the interswitch rate, the Liberal government will make it more difficult for shippers and farmers. We will also see an increased use by American railroads without reciprocal rights for Canadians. Again, I am not sure what the logic of that is. Last I checked, the Canadian government should be putting Canadians first.

One hopes this is not the Liberal negotiating strategy for NAFTA, literally giving the farm away. The Liberals could and should keep the Conservative policies in place, policies that were designed by people who actually have experience in this area and who are working, or have worked, with grain farmers. Instead, they have chosen to side with the industry, making life far more difficult for shippers and farmers.

Another part of this omnibus bill, and, as I said, this is just a laundry list of things, is a proposal for the railways to have locomotive voice and video recorders. This has already been mentioned in the House today. I believe this initiative is designed to help prevent further rail accidents, but, again, this is another item that has been added to the list and the legislation has not been thoroughly thought out.

There is not a person in the chamber who does not want to improve rail safety. We want our railways to be as safe as possible. As a former minister of labour, I understand the call for locomotive voice and video recorders, the LVVR, to be installed, but I do not think this legislation has been thoroughly thought through.

First, Transport Canada just launched a review of the Railway Safety Act in May. Why would we not wait until that review comes back before moving forward?

Further, the public has not seen the analysis of the privacy aspect of this initiative. Regulations mandate that airline cockpit voice recorders keep only a record of the last two hours of a flight. Thus far, all we have heard is that an entire transport trip would be recorded with respect to rail. The minister needs to clarify this, and fairness is important. As I have mentioned before, details are important, and the details of this legislation simply do not exist.

There have also been concerns raised about the use of this data. The legislation states that it would only be used for Transportation Safety Board accident investigations and for rail corporations to inform their safety management systems. However, there are concerns that there would be no limit on LVVR usage in the legislation and that the rail industry would use it for employee discipline beyond the intended purpose. This initiative clearly needs to be better thought out, and quite frankly, clarified. Workers need to know what is happening, and the rail industry needs to understand as well.

If all these loose ends do not demonstrate the weakness of, and the concerns about, this omnibus bill, I have decided to save the best for last. In one of the two marine-related clauses, the minister is proposing to amend the Canada Marine Act to allow port authorities and their wholly owned subsidiaries to receive loans and loan guarantees from the Canada Infrastructure Bank.

As members know, I have some strong views on this bank. First of all, it seems like just another classic example of an ill-thought-out component of the Liberal omnibus bill. Despite calls from every party and every sector in Canada to separate the Canada Infrastructure Bank from omnibus Bill C-44, the Liberals ignored everyone and rushed ahead with this flawed initiative. Even the bible of the Liberal elites, the Toronto Star, demanded further parliamentary review. This $35-billion slush fund, as the Star says, “should not be railroaded through Parliament as a mere footnote in a 300-page omnibus budget implementation bill”.

The only people in Canada who seemed to have been in a rush for this infrastructure bank to be created and the legislation passed were those who use their connections with the Liberal Party to make a few more dollars. The infrastructure bank has been a boondoggle from day one. The budget in 2017 revealed that $1 billion of lapsed infrastructure funding from 2016 will not be reallocated until fiscal year 2022-23. If that is not bad enough, we learned that $15 billion will be taken away from community infrastructure projects to finance the infrastructure bank.

Municipal leaders in my riding and others across the country, particularly in small communities like my own, are wondering why they never seem to benefit from the Liberal government. I wonder if part of it is that the Minister of Transport comes from a large urban area, and the Minister of Infrastructure comes from a large urban area, and they just do not seem to understand that small communities like Collingwood or Alliston, or others across the country, actually need help as well. Small municipalities may never benefit from the infrastructure bank, because even if they scraped together all the money for a large proposal, they would be competing for the minister's approval. While folks like the Minister of Infrastructure and the transport minister live in large cities, small-town Canada actually has no place in the Liberal infrastructure plan.

If the clear favouritism toward big cities over the rest by the Liberals is not clear enough, the governance of the infrastructure bank is so vague and open-ended that we can see a governance scandal on the horizon. I will start with the mandate of the bank. What mandate? There does not seem to be a clear one. The mandate of the Canada Infrastructure Bank is so vague that we are not sure what it is actually supposed to target, and there is no policy directing the bank's investments thus far.

There are also no criteria to determine whether the bank has made investments that benefit Canadians, or whether it has been a huge waste of money and resources.

It will certainly be the latter, as the bank duplicates the work of the P3 Canada fund, which is a completely independent crown corporation.

Alarm bells have also been rung about the bank and its potential for political interference, and there is good reason for this. Final sign-off on the project will be in the hands of the minister, and we know that this is a flawed initiative.

We have learned that foreign companies are able to apply for it. Let us say that a Chinese donor to the Liberal Party applies to the bank and receives $100 million as a loan, and the project goes bust. Who is on the tab for that? It is Canadian taxpayers, people in my riding and yours, Madam Speaker.

Like Bill C-44, Bill C-49 is an example of a poorly thought-out omnibus bill. It would do little to improve transportation.

I will be opposing this legislation, as will my colleagues on this side of the House.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Madam Speaker, when we look at this vast country, with a pretty small population, what we have seen are a lot of monopolies and oligopolies when it comes to transportation in our rail system and our airlines. We have few, and that has caused a lot of concern, a lot of challenges, and a lot of difficulties for our shippers.

The member should listen to the experts and read the science on modernizing our transportation system and making a better transportation system.

I listened to University of Saskatchewan professor James Nolan, who said that this is good news for our grain shippers. He said, “The bill is surprisingly pro-shipper. Shippers have got a fair number of concessions that they wanted”.

This legislation would meet shippers' requirements when they have only one or two transport companies in their area they are able to negotiate with. This legislation would enable them to move away from that, maybe the primary carrier, and have another carrier take care of their needs. That has not been possible, and that has been a challenge for farmers. We must listen to the experts.

Would the member for Simcoe—Grey not agree that bringing in more competition through Bill C-49 would help our industry, our farmers, and our businesses compete in what we find in our country, which is a transportation system with few players?

[Kellie Leitch, Conservative, Simcoe—Grey, ON]

Madam Speaker, we had a former minister of agriculture in the House who put forward a bill in 2011 called Marketing Freedom for Grain Farmers. It was overwhelmingly supported by grain farmers and those who support them in what they are doing throughout western Canada.

There is a reason there are a lot of Conservative members on the Prairies. It is because we actually support grain farmers and the people who support them. This legislation would not do that. I look forward to the Liberals going back to what we put in place in 2011.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Madam Speaker, in her speech the member for Simcoe—Grey mentioned how uncomfortable it is to sit on the hot tarmac for hours, and then she spent a lot of time talking about all the good things the previous government did.

In nine years of government, why did the Conservatives not bring in a passenger bill of rights, when it is clearly what Canadians want to see?

[Kellie Leitch, Conservative, Simcoe—Grey, ON]

Last I checked, Madam Speaker, we are debating Bill C-49, and it would do nothing for passengers.

I was very clear in my remarks. The bill is a hodgepodge of a number of ideas, but there are not a lot of details. The devil is in the details, and passenger advocates have been clear that this legislation does not cut it.

[Peter Fonseca, Liberal, Mississauga East—Cooksville, ON]

Madam Speaker, there has been a big boom, and we are getting a lot more tourists coming to Canada. The tourism association of Canada has lauded this legislation, because it would bring assurance that those who are coming from outside, and domestic tourists, could get on our rail system, get on our planes, and feel safe.

That member's party, for 10 years, did not do anything. The Conservatives shirked that responsibility. They left it aside. Why did they not do anything for 10 years on something that is so important to the safety of our citizens and our travellers?

[Kellie Leitch, Conservative, Simcoe—Grey, ON]

Madam Speaker, the member began by talking about individuals actually being able to come to this country for tourism. Jacking up the fees for security and making it more expensive to enter the country, and more expensive for passengers, is not the way to increase tourism. We on this side of the House are about creating jobs. That means not increasing fees.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Madam Speaker, I am pleased to take part today in the debate for Bill C-49, the transportation modernization act. This Liberal omnibus bill would substantially amend 13 different acts and have a profound effect on three major modes of transportation: rail, air, and water.

These are big changes, and it does not look as if the Liberals would be changing the rules for the better. Bill C-49 is the first legislative response to the 2016 Canada Transportation Act review. While we welcome the commitment to a modernized and safer transportation strategy, we are concerned that the proposed changes would have costly unintended consequences.

While I would like to discuss all the complicated sets of changes from Bill C-49, such an undertaking would be impossible, given the time constraints of this debate. Today, I would like to particularly talk about the changes to rail transportation and what this means for our Canadian farmers and producers.

Our biggest concern on the changes to rail transportation has to do with the changes to the long-haul interswitching that this bill would make, in replacing the provisions introduced by the previous Conservative government with Bill C-30. Bill C- 30, or the Fair Rail for Grain Farmers Act, extended interswitching distances to 160 kilometres. Those provisions expired on August 1.

While new interswitching provisions were anticipated, this bill is far from meeting its objective of improving shipper and producer options with the new 1,200-kilometre interswitching tool. The system introduced through Bill C-30 was popular with shippers. It provided the certainty of a regulated rate up to 160 kilometres, and it is key that they dealt with the regulated rate for that full 160 kilometres.

With Bill C-49, the Liberals are putting forward a new long-haul interswitching tool on hauls of up to 1,200 kilometres, or up to 50% of the length of the entire haul. Shippers would be charged the regulated interswitching rate for the first 30 kilometres of the haul, and then the rate determined by the Canada Transportation Agency, which is determined on a case-by-case basis based on similar pricing hauls. That goes for the remainder of the distance to the interswitch point.

Shippers would only be able to interswitch at the first available interswitch point. The nearest interswitching location for many shippers and producers in northern Alberta and British Colombia would be in the Kamloops–Vancouver corridor, and the other exclusionary zone is from Quebec City to Windsor. lnterswitching is not allowed beyond 30 kilometres in these areas. For captive shippers, the new interswitching provisions would do nothing to encourage more competitive rates or improve competition.

This is a serious problem. It is important to remember that railways in Canada operate in a near monopoly situation. Captive shippers and producers have no choice but to use one company, to which they are effectively held hostage. This situation could put shippers and producers at a real disadvantage.

While there are provisions in Bill C-49 that would allow shippers to request a contract from a railway with reciprocal penalties, the penalty needs to be designed to acknowledge that the railways have much greater economic power than the shippers. We can also see that Bill C-49 is intended to encourage the efficient movement of shippers' traffic while creating a system that is fairly balanced between the shipper and the railway, but this original intention is eclipsed by the many uncertainties of Bill C-49, which are also present on this issue. To achieve the intended outcome, the government must improve and clarify its provisions for both issues of interswitching and penalties.

Bill C-49 also proposes changing the 30-kilometre interswitching rate so that the interswitching rate over 30 kilometres would be decided by the CTA on an ad hoc basis, as I mentioned earlier. This 30-kilometre interswitching rate would be set each year. It purports to take into account the railway's infrastructure needs across the entire network, which could increase the rate paid by shippers.

The rate-setting regime this bill introduces needs to be designed to ensure shippers always have access to competitive rates. As it stands, the rate would be derived from comparable traffic that is subject to captivity. This system needs to concentrate on a concrete review mechanism to ensure it is actually working for shippers.

However, the Liberals cannot just design this system and leave it to simply administer itself. It is not a budget. Without a sunset clause or predesigned review dates in two to three years, there are absolutely no guarantees for shippers and producers that they will benefit from it.

To remain competitive, shippers and producers rely on clear provisions to ensure efficient access to competing railways. The Liberals are failing to provide clarity and assurances for our Canadian shippers.

In addition, the new long-haul interswitching rates would be more difficult for shippers to use and will not serve as a useful tool in negotiations with the railroads. The proposed slew of changes to the long-haul interswitching rate present very vague outcomes. The sheer number of the regulatory changes and the administrative cost will put Canadian carriers at a disadvantage, especially against U.S. carriers.

Some argue that implementing these changes will increase U.S. railroad access to Canadian traffic at regulated rates without reciprocity. The government has expressed a desire to increase agricultural exports exponentially in the coming years, but has come up short with policies that would help achieve this. If we want to help the agricultural sector increase production and expand its global market share, we need to do more to increase its competitiveness in the global market, not restrict it. One of the ways to do that is to make sure they have efficient and reliable ways of moving their products.

Transportation needs to work much better and the bill must strive to improve rail transportation, because increasing the amount of produce that our amazing farmers produce will be useless if getting it to market becomes a substantial business cost for our producers. Canadians need and expect great rail service. We need an efficient system that ensures the cars show up and grain gets shipped on time.

An article in the Manitoba Cooperative states:

Western Canada’s bigger-than-expected crop is moving to export slower than at last crop year’s record pace, and while grain companies aren’t panicking, Keystone Agricultural Producers’ (KAP) president Dan Mazier says it’s costing farmers....

For most of the current crop year, which began Aug. 1, Mazier said CN Rail hasn’t delivered as many cars as it did a year ago, based on data published by the Ag Transport Coalition (ATC). It reports weekly on the number of cars most grain companies order and the number the railways deliver.

I have the Ag Transport Coalition numbers here for week 12 from October 15 to 21, showing that CN supplied 51% of the hopper cars that were ordered for shippers for that week, which resulted in an unfilled shipper demand of 2,614 hopper cars; and CP supplied 94% of the hopper cars ordered by shippers for grain in week 12, resulting in unfulfilled shipper demand of 281 hopper cars, with nearly 3,000 in total not making it in week 12.

In addition to that, speaking of competitiveness, we are also aware of the ongoing NAFTA negotiations. It is therefore remarkable that the government would allow the new 1,200 kilometre interswitching distance to increase U.S. rail access to Canada at regulated rates, allowing the U.S. to access this Canadian traffic without reciprocity. It seems like weak negotiating on the part of the government to give up this leverage before the NAFTA negotiations are concluded. It is another head scratching idea by the Liberal government to propose such changes even as NAFTA is being renegotiated. No wonder people think that the Prime Minister is napping on NAFTA, because Canadian competitiveness seems to be at the bottom of his priority list. Policies like this directly hurt our competitiveness and are yet another hurdle for producers and shippers to clear.

As it stands, there is simply too much uncertainty about the impact of the newly redesigned interswitching provisions. They need to be reviewable and timely.

Unfortunately, all of this uncertainty and unintended consequences stem from the Liberals' inability to actually consult and listen to industry experts and Canadians. The Liberals are quick to spend taxpayer money to travel around the country to consult and take selfies with Canadians, but when it comes down to it, the Liberals only listen to themselves.

Members from this side of the House have spoken to many stakeholders and experts. Many of these experts believe that what the Liberals are proposing is a convoluted remedy with unknown consequences.