Mr. Chair and members of the committee, thank you for the opportunity to present the Railway Association of Canada's perspective on Bill C‑39.
Our industry supports the government's objectives of accelerating infrastructure projects, encouraging investment, and strengthening Canada's competitiveness. However, certain provisions of the bill risk undermining these objectives. We believe targeted amendments are necessary to ensure the stability of our supply chains.
You have heard and will continue to hear a consistent message from supply chain participants, including the message from 18 national associations, in a letter I shared with you yesterday: Canada needs greater certainty to build, invest and trade, including the ability to intervene proactively before a strike or lockout significantly disrupts our supply chains.
We strongly support measures that accelerate infrastructure development and encourage private investment, including streamlined federal approvals, expanded exemptions for railway construction and the productivity mega deduction, a long-standing RAC priority that will strengthen supply chains and Canada's competitiveness.
There are also positive changes to the Canada Labour Code. Earlier bargaining can help. Special mediation and public reporting can improve transparency and accountability. Geographic certification can help promote supply chain stability at B.C. ports.
However, Bill C-39 falls well short of solving Canada's labour stability challenges. As proposed, the section 107 authority can be exercised only after a strike or lockout begins. By then, significant economic damage will already have occurred, and Canada will continue to repeat the damaging pattern of routinely telling global customers and investors that our supply chains are not reliable.
Railways cannot simply turn operations on and off. With 100,000 railcars and 4,000 locomotives across 40,000 kilometres of tracks, railways must begin winding down operation days or even weeks before a potential work stoppage. Trains stop. Ships wait. Canadian businesses lose sales. Workers lose income. Customers make other arrangements. Our trading partners again question whether Canada can deliver, and traffic diverts to alternative U.S. ports and supply chains.
This is not simply a labour relations issue: It is a national economic and trade issue. The Senate transportation committee recognized this challenge in its “Keep Canada Moving” report, recommending alternative dispute resolution when rail or marine work stoppages threaten the national interest. Bill C-39 should act on this recommendation by allowing the government to intervene before a work stoppage in exceptional circumstances, when failed negotiations threaten significant harm to the national economy.
We're not asking government to routinely intervene in collective bargaining. We always want to reach a negotiated outcome with unions, and we work hard to achieve deals at the bargaining table. We are talking about exceptional circumstances in which the national interest is at stake because of failed negotiations, no reasonable prospect of an agreement, a pending work stoppage and evidence of significant harm to Canada's national economy, trading relationships, consumers and exporters.
We also recommend removing extended interswitching from Bill C-39. Previous pilots demonstrated that this measure diverted Canadian rail traffic, jobs and investment to a U.S. carrier. This policy undermines the government's trade diversification, investment and economic growth objectives.
We are also concerned about the proposed national trade corridors council. We have already seen the supply chain table and the national supply chain office, neither of which demonstrated that greater government involvement improves supply chain operations. What would another council accomplish that these initiatives could not?
We ask the committee to make three targeted amendments: Enable earlier intervention under section 107 in exceptional circumstances, remove extended interswitching and remove the national trade corridors council. These changes would help Canada build, invest and trade with greater certainty.
Thank you.
