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.

[Michael Keenan]

I would add one small comment before I turn it over to my colleague from the Canadian Transportation Agency.

Very shortly after Bill C-49 received royal assent, Minister Garneau and the CEO of the Canadian Transportation Agency launched consultations on the details for the regulations that are now possible because of the legislative framework put in the bill.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you, Madam Chair.

I'll try to be very quick, because I know my time is brief.

On Monday, May 28, the Canadian Transportation Agency's CEO, Mr. Streiner, announced that a comprehensive consultation process would start on the new passenger bill of rights.

After the Emerson report, after consultations on those consultations, the consultation that would have taken place before Bill C-49 was introduced, after this committee reviewed Bill C-49, after the Senate reviewed Bill C-49 and gave it the same scrutiny, and after the attempts by both members on this side of the table and in the Senate to amend Bill C-49 to put some sort of frame to the bill of rights, we're now conducting consultations once again on a passenger bill of rights.

I just want to know if anybody could tell me how much this consultation is going to cost the taxpayers.

[Sean Fraser, Liberal, Central Nova, NS]

Thank you very much.

Minister, it's good to have you here once again. Just when I thought we were done with Bill C-49, I'm going to breathe some life back into it.

Long-haul interswitching was a major piece of this marquee legislation for your department. One of the issues I discussed during debate in the House and at length at committee with some of my colleagues from different parties was the need to ensure that long-haul interswitching allows for more effective and efficient transport between different regions and different industries. I saw that members of the opposition actually wrote a letter to the editor in one of my local papers, suggesting that the Maritimes were in fact being discriminated against because of certain remedies not being available for that part of the region. I don't believe that to be the case, seeing as how there are actually no class I railways in Nova Scotia, P.E.I., or Newfoundland, though, with respect to New Brunswick, at least one shipper has raised this potential issue.

I'm curious; can you reassure those watching back home that in fact this is not some slap against Atlantic Canada, and on the importance of making sure that products are moving in different regions of the country—not just western Canadian grain, for example?

Air Transportation

[Marc Garneau, Liberal, Minister of Transport]

Mr. Speaker, every Canadian knows that buying an airline ticket entitles the purchaser to a certain level of treatment. That is why we are very proud of bringing in air passenger rights.

They were announced in Bill C-49 and we also announced that we were going to consult Canadians. Some 13 million Canadians travel by plane. It is the right thing to do and the Canadian Transportation Agency initiated the process yesterday.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you.

In the 2018-19 main estimates, I think there was some mention of some of the business risk initiatives getting an increase in funding. I just want to put this in the context of what our grain producers just went through with their transportation problems. Did you see a spike in demand? Is our current suite of programs adequate? Did we meet the demand for the crisis that just occurred?

I know that Bill C-49 has just passed, but I just want to ensure that we're actually there for our producers. We've heard a lot of very gut-wrenching testimony, that they were in a pretty bad spot.

[Lawrence MacAulay, Liberal, Cardigan, PE]

—but you can answer for that in the next election. We feel that Bill C-49 was vital to the agricultural sector.

[Lawrence MacAulay, Liberal, Cardigan, PE]

You know what took place before Bill C-49 came into play.

[Lawrence MacAulay, Liberal, Cardigan, PE]

I was very polite when you were speaking, even though I mightn't have agreed with all you had to say.

What I had to do as Minister of Agriculture and Agri-Food was to make sure the issues for the nation were addressed. When you look at what took place and all the amendments and all the issues that were involved in Bill C-49 and all we did to make sure that everything was addressed and the grain moved, I'm sure you fully agree that reciprocal penalties are vitally important. I never dreamed the likes of that would happen when I wasn't Minister of Agriculture and Agri-Food. It's so important to the farmer, not that it's unfair to the railways, but it's just fair both ways.

Making sure that soybean was under the maximum revenue entitlement, I'm sure you agree with that, even though you might have voted against it and that was vitally important.

[Lawrence MacAulay, Liberal, Cardigan, PE]

It's also important, John, when you're putting a bill together, that you put the proper transportation system in place for the country. I think you're fully aware of what took place with Bill C-49 and all the investments that have been made.

You know the difficulties that we had over the years, when your government was in power and grain was not moving in the west. When we got elected—

[John Barlow, Conservative, Foothills, AB]

Thank you very much, Mr. Chair, and my thanks to the minister for being here.

Before I ask my first question, I wanted to correct the record a little bit on some of the comments you've made so far. You talked about the investments you've had in CFIA, especially in the food safety program. Maybe you're not aware, but you're actually reducing the funding to the food safety program by close to $100 million and you're reducing the staff by close to 700 employees in the food safety program at CFIA. That's one.

You talked about front-of-pack labelling and you wanted to make sure the labels weren't criticizing the ingredients in those products. That's exactly what the front-of-pack labelling does. You're criticizing Canadian wholesome products like milk, meat, and yogourt. Those are some of the concerns we have with those projects.

My first question is about Bill C-49, and I appreciate your taking a lot of credit for the work that was done on Bill C-49, but you also talked about being a farmer in P.E.I. and the importance of that bill. You also know that Atlantic Canada is exempt from some of the elements of that bill, including long-haul interswitching, which ensures that farmers in Atlantic Canada are still captive to one shipper. Also, farmers are asking for own-motion powers for the Canadian Transportation Agency, which is not in there.

I quote Jeff Nielsen, president of Grain Growers, who said, “Everything would have been nice. All the amendments the Senate came back with would have made the bill that much better.”

Minister, why weren't you fighting for those very critical amendments that our farmers wanted? Why weren't you fighting for some additional accountability in Bill C-49 to ensure that in the event of another grain backlog there would be elements in place for the Canadian Transportation Agency to take action against the rail lines without having to go through the minister?

[Lawrence MacAulay, Liberal, Cardigan, PE]

I agree completely. Of course we don't want to take cars from somewhere else. What we want to do is to make sure there are enough cars to move the products. Without any question, the 1,000 hopper cars for CN alone is a big issue, but it's much more than that. I've indicated it won't all be solved the day after we sign Bill C-49, and farmers are fully aware of that. There could be double-tracking in areas, the bottleneck in Vancouver, all of this stuff, though I agree the bottleneck in Vancouver was not the problem this year. It is a problem sometimes, though, and that has to be addressed too. Down the road, it gives us, the government and the railways, an opportunity to put a proper system in place.

Lloyd, you're fully aware, and everybody at this table is fully aware, that if we do not put a proper system in place and do not deliver the product on time, somebody else will—

[Lawrence MacAulay, Liberal, Cardigan, PE]

I have to say that everybody, all the grain sectors represented there, seemed to be pleased. I had Ralph Eichler, the Progressive Conservative minister, and me. The railways were not there, but I understand they're quite pleased too. You kind of wonder what's going on when everybody's pleased.

You mentioned about CN ordering new cars. That's just one part of what's taking place, the new hopper cars that will carry 10% or more product more efficiently. That's so vitally important.

Being a farmer, having grown potatoes on Prince Edward Island, having been involved in demurrage, and what takes place if the car comes in and you have some kind of a problem and can't fill the car or cars, I know that what you do is pay. Now it's reciprocal penalties. I never expected I would be Minister of Agriculture and somewhat responsible for that part of the legislation. I found it truly unbelievable. I think it's great for the grain farmers right across the country and for anybody else who is shipping. That was one thing. When it was mentioned to me first, of course I pushed, like everybody does, and you push as hard as you can for agriculture, no matter where you are. I might have indicated that it was a big request, and I might have also indicated that it was probably not possible, but here it is and I think people are so pleased.

To get soybean under the maximum revenue entitlement, that's only a matter of fairness, in my opinion. It's a very important sector. The soybean is grown right across this country. What it does is give them more protection. It's obvious that the change that has taken place with the legislation in general gives the railways the opportunity to invest in more infrastructure to move agricultural products, and many other products, too.

There's an awful lot more to Bill C-49, but I know, Lloyd, you want to ask me something else.

[Lloyd Longfield, Liberal, Guelph, ON]

Thanks. Mr. Chair.

Mr. Minister, it's great to see you here. I saw you in Toronto last Friday. You were coming back from an announcement in Winnipeg on Bill C-49 being successfully put through the House, on both sides. It's a terrific piece of legislation that's going to help our farmers. There was great reception in the room. Could you comment on what you saw in terms of the reception in Winnipeg? You could save that one.

In the context of a tour our committee did, where we went across western Canada in the last few weeks, we went to GrainsConnect, in Maymont, and we saw a new superterminal that is processing shipments. The loop system they're using is out of this world. They're filling a hundred cars in one shift. Incredible technology is being used in Saskatchewan.

During our tour of the Vancouver harbour, we looked at the expansion of the G3 Terminal there. We looked at Richardson's completed expansion, and we looked at the Viterra expansion from a few years back. CN is now purchasing 1,000 new hopper cars. They're current to customer demand for the last month or so. We have capacity in the network. We have a transportation bill that's gone through, Bill C-49. What are they thinking in Winnipeg? What's the current climate in the agriculture sector, as you're seeing it, around our transportation and getting grain to market?

[Lawrence MacAulay, Liberal, Minister of Agriculture and Agri-Food]

Thank you very much, Chair.

Good afternoon, everyone.

I'm pleased to be back before the committee. Of course, I have my wingers here, which will be very helpful for information.

I want to thank the committee for its outstanding support for the Canadian agriculture and agri-food sector. The members of the committee are working together and across party lines to address some pressing priorities for Canadian farmers, and I want to thank the committee for its work on climate change issues in agriculture, advancements of technology and research in the agricultural industry to support Canadian exports, and the grain transportation backlog.

In particular, I want to thank the committee for its upcoming study on the mental health challenges faced by our farmers. This is a very serious issue, both on and off the farm. Mental health is a high priority for our government. My deputy minister has made it a high priority for the department, and our colleague, Mr. Jean-Claude Poissant, has been a champion for mental health on the farm, both in his riding and across the country.

My message to you today is that our government will continue to work with you to grow the Canadian agriculture and agri-food sector. I would like to touch on three areas: the main estimates, progress and priorities, and challenges and opportunities for the sector.

As you can see, the main estimates show a total budget of over $2.5 billion for 2018-19. That represents an increase of $260 million compared with last year. The two main reasons for this increase are the forecast increase of $150 million in business risk management spending based on market conditions, and $96 million for new programs to help dairy producers and processors stay on the cutting edge.

Across Canada we're rolling out our investments under the $350-million program for dairy processors and producers. These dollars are helping the industry boost production and efficiency through investments in equipment and systems for milking robots and processing technologies.

The main estimates also reflect great work done with the Canadian agricultural partnership. That includes grants and contributions of $105 million for the coming year for federal programs supporting research and innovation, market development, public trust, business risk, and diversity. The estimates also include over $200 million in cost-shared programs with the provinces and territories. It all adds up to a major investment in the agriculture and agri-food industry.

We've reached a couple of milestones since we last met. On May 23, Bill C-49 received royal assent. This is tremendous news for the grain industry. We proposed key amendments that responded to the needs of the industry. Demand for our great Canadian wheat and interest in grains continue to grow. The legislation will help to ensure our farmers can meet these demands with an efficient and reliable rail service. We want a world-class transportation system, not just for this year or next year but for many years down the road.

April 1 marked the launch of the new $3-billion, five-year Canadian agricultural partnership. The industry was very clear on the need for a smooth transition from the previous framework, and we were able to do that. We have completed almost all the bilateral agreements with the provinces and territories, covering shared funding of $2 billion over five years. The Canadian agricultural partnership also includes $1 billion over five years for federal activities and programs.

In February, as I mentioned earlier, we launched six federal programs to help the sector reach new heights. We also continue to support the great work of our agricultural scientists across the country. Agricultural and agri-food scientists continue to make groundbreaking discoveries that help our farmers increase production, cut costs, and boost the bottom line.

Over the next five years, the Canadian agricultural partnership will help Canadian farmers and processors grow their markets, innovate, and protect our environment. It will also help farmers manage their business risk while strengthening public trust in their products. The partnership will help bring more young farmers, women, and indigenous people into leadership roles in the sector.

Investments over the past three budgets are building on a strong agricultural agenda.

Agri-food has been selected as one of the five groups to receive funding under the $950-million supercluster initiative, budgeted in 2017. Protein Industries Canada will make our country a global leader in sustainable plant protein. It will help to open new markets for our pulse growers.

Budget 2018 builds on this work with the single largest investment in fundamental research in Canadian history. That's an investment of nearly $4 billion in Canada's research system to support the next generation of researchers, while upgrading the tools they need to do the job.

We're also investing $75 million to grow our trade in China and across key Asian markets for Canadian farmers. Trade continues to be a strong focus for our government.

We're aiming to increase our agricultural exports to $75 billion by 2025. On March 8, Canada signed the CPTPP. For the agricultural sector, that means tariffs will be eliminated on Canadian meat, grains, and horticultural and processed foods. The access could mean $1 billion per year of new sales for beef and pork producers.

When you combine these benefits with the benefits under our trade agreement with the EU and other trade agreements, Canadian farmers will have a competitive edge in about two-thirds of the global economy. That's good news because it helps us diversify our trade.

Asia is a new frontier for our farmers and food processors. In March, I led a trade mission to Japan and Korea, and earlier this month I was in China, which has a growing middle-class population that's looking for the food that our farmers and ranchers can produce. The mission was a great opportunity to showcase Canada's high-quality food and seafood, and to strengthen our ties.

We're also working with our partners in North America to update, modernize, and improve NAFTA. Right across North America, farmers are united in their support of NAFTA. On Thursday, I will be in Dallas to address the World Meat Congress, and I will deliver Canada's message for a strong, modern, and progressive NAFTA.

The bottom line is that Canada's farmers are ready to feed the world, and the Government of Canada stands ready to support them in these efforts. Of course, challenges remain and always will. We're working to resolve the situation in India affecting our pulse exports.

There will always be challenges in agriculture, whether it's tough competition on the global stage, protectionism, or changing consumer demands.

When I look ahead at the prospects for our great industry, I see a great promise. Canada's agriculture and agri-food industry continues to grow. Last year, the industry generated $111 billion of our GDP, according to our recent financial outlook. The average farm net worth will hit a new record in 2018, and Canada's net farm income will be the second highest on record. Last year, our agriculture food and seafood exports hit an all-time record of over $64 billion, moving us closer to that $75 billion target.

Demand for our food continues to grow, and Canada has a competitive edge to meet that demand. We are blessed with an abundance of farmland and water, the best farmers and ranchers in the world, and a government that's reinvesting in agriculture.

The time is right for the Canadian agriculture and food industry to increase its presence on the global stage. Through smart investment and continued collaboration, I'm confident that we can meet the challenges that lie ahead.

I want to thank you again for your attention.

Thank you, everyone.

[Kathleen Fox]

Bill C-49 contained provisions with respect to the mandatory installation of locomotive voice and videos in all leading locomotive cabs on main track. That has recently passed. We're very pleased that finally, after many years of calling for voice and video recorders, they will be installed in lead locomotives on main track.

That being said, there's still a lot of work to be done. The regulations have to be developed that enshrine the balance between privacy and safety. We also have to examine our business processes in terms of sharing that data going forward.