Environment Committee on Nov. 27th, 2006

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

You say that you have produced two annual reports. You also mentioned a downward trend in salt consumption. In what percentage?

[Richard Hanneman]

I think we all agreed that was not going to be a relevant statistic, but I do believe there has been a diminution of salt.

Do you have the numbers, Cynthia?

[Cynthia Wright]

I don't have the numbers with me.

[Richard Hanneman]

I think you can say that the amount of salt has gone down. I don't think you can conclude from that alone that there has been progress. As was said earlier, it depends on weather. Also, at a conference here in Ottawa last spring they talked about the effects of global warming and what it would do to winter maintenance activities; the conclusion was that it would mean more salt would have to be used.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Are you planning on using more?

[The Chair, Conservative, Bob Mills]

We'll have the next round, and Mr. Warawa.

[Mark Warawa, Conservative, Langley, BC]

Thank you, Mr. Chair.

Again, I appreciate the witnesses' presence here today.

My riding is Langley, British Columbia. We didn't use a lot of salt in that area until this weekend.

I'd like to continue in the vein of enforcement and compliance--basically, how issues of compliance and enforcement are initiated and how we work with industry to make sure they're aware of the statutes. I believe that would be my first question for the staff of the department: how do we make sure industry is aware of the obligations? Is it step by step? Who initiates that there is a problem from a specific company or from the use of a substance? Is it a public complaint? Is it field officers? Who initiates it? Is the education progressive as they deal with the person who is not using the substance properly? If there's a compliance issue, are they educated through the process and there are fines only if they are pushing back and not wanting to be good citizens? Basically, how do we go through the education and enforcement?

[Cynthia Wright]

In the early days before regulation is passed, we begin what we call compliance promotion with industry. We do workshop training with them to explain what their obligations are, how they're going to have to measure or report whatever is relevant. There are extensive training workshops, written material, etc. Dry cleaning was translated into numerous languages, mail-outs, as well as sessions. We often work through industry associations to reach the regulatees and do everything we can to get out to the regulatee before the regulation comes into effect.

Who initiates the actions? Once the regulation is in effect, we have an inspection plan. That inspection plan is based on our knowledge of the degree of compliance we think is already in place when the regulation comes into effect. Usually the compliance level pretty close when the regulation comes into effect. We have a history on companies and generally have some fairly good information on who has a tendency to comply. Based on that, we'll do an inspection across the country, looking at where we expect violators.

Enforcement officers will go in and conduct inspections, and then based on that information they can use a number of different enforcement tools. Usually in first level, particularly if the industry is showing a high degree of willingness to comply, we have what's called a warning letter that writes out very clearly what the expectation is, and then we follow up on that.

If after we follow up on the warning letter there are still some violations, and if they're not of a serious nature, we have another step we can use. That is the inspector's directive, which is really like it sounds, spelling out exactly what we expect to have done and by when.

We can then go into a number of actual enforcement tools that can lead to penalties. That environmental compliance order we were talking about earlier allows us to ensure there's a stoppage of whatever the violation is.

If a charge is laid and an industry shows a high degree of willingness to comply, there's something called the environmental protection alternative measure, which is essentially a dispute resolution to avoid the costly court proceedings. If they agree to what they're going to do, we write that down and then we don't go through a court, but we follow up.

Ultimately, there are court proceedings, and the fines under CEPA are quite severe. They can go up to $1 million a day for the time a violation exists. Mr. Wright is suggesting the fines we collect be shared if there's a civil prosecution. To date, the federal government has prosecuted. We're encouraging judges to assign those fines to something called the environmental damages fund. Industry pays into that fund, and we can use the money to rehabilitate the environment, do community engagement programs, or do something related to the violation to ensure the environment is improved.

[The Chair, Conservative, Bob Mills]

Mr. Glover.

[Paul Glover, Director General, Safe Environments Programme, Department of Health]

Thank you, Mr. Chair.

The member's question was directed at both departments, and it provides me with an opportunity to explain my silence today. With respect to enforcement and compliance, the act is fairly clear. Environment does that on behalf of both departments. We express our concerns, and they act on our behalf.

One other piece of information relevant to this discussion is that a trend level determining compliance can be done through things like NPRI, where we can see our levels going up or down. On the human health side, we still have a bit of a gap there, in that we don't have programs like biomonitoring to say what the levels are in humans, so that at an aggregate level we can keep track of that. We hope that will change.

[The Chair, Conservative, Bob Mills]

Thank you, Mr. Warawa.

Mr. McGuinty.

[David McGuinty, Liberal, Ottawa South, ON]

Thank you, Mr. Chairman.

Can I go back to this discussion of the spectrum of possibilities under CEPA? At one end, there is pure volunteerism; at the other end, command and control regulation. If you stopped any Canadian coming off any bus in any city in Canada, they would understand it isn't as simple as two extremes. They understand when they purchase a vehicle that's a hybrid vehicle or an alternative-fuel vehicle that in Ontario, for example, they get a $1,000 provincial sales tax rebate. They'll understand if they live in Ontario, my home province, that they must have their vehicles tested for emissions on a certain-number-of-years basis. If the car isn't meeting the emissions test, it has to go back for retrofit. So most Canadians understand that CEPA should not be, and is not simply, a conglomeration of two extremes--regulation in command and control versus pure volunteerism.

Everybody understands that in 40 years of environmental practice in the western world, there's a full spectrum of possibilities. That's what our smart regulation panel tried to achieve in the past government, which is to say, let's be intelligent about this, let's be cost-effective about this, and let's work hand in glove like a mature democracy, business and government together.

The question I want to put to you is this. I've heard no one at this panel speak about two or three other weapons in our arsenal between these two extremes. One is the use of fiscal instruments.

A more specific question to Ms. Wright is, how many people inside Environment Canada today are working on environmental and economic linkages and measures that can help us achieve CEPA objectives? I would guess there are fewer than 10 full-time employees working at Environment Canada in that area.

Mr. Lloyd, you mentioned the notion of accelerated capital cost allowance. The finance department doesn't like to toy with capital cost allowance. It's been reluctant to do so for 20 years. How many people at Finance Canada are busy delivering options for consideration by the Canadian people to achieve environmental objectives using economic measures?

Finally, the most important example we've seen of using an economic instrument has been the Kyoto Protocol, which was like that old Sesame Street riddle, “One of these things is not like the others”. The Kyoto Protocol, for the first time in human history, was going to reflect two things: first, that we have one atmosphere; and second, that we're going to monetize carbon by internalizing the price of carbon in economic decision-making. I would dare say the salt industry would be weighing its approach to salt differently if cumulative environmental impacts were costed. If a dollar figure were placed on damage to a river or damage to a lake, and a company went back to its shareholders to account for it, it might be different.

I want to put two things to the panel: measurement and money. No government can tell one company over another company, whether it's part of Responsible Care or the Forest Products Association of Canada's pulp and paper standards, or any other industrial conglomeration, no government can say, “Company X, you're going to be rewarded this way, and Company Y, you will not be rewarded this way”, unless it can actually measure it. You cannot manage what you cannot measure. No one has talked about eco-efficiency indicators and how you're actually going to measure apples and apples and apples and oranges, and secondly, how we can use the economic system, fiscal and tax spending for example, to achieve environmental impacts.

[The Chair, Conservative, Bob Mills]

Panel, you only have one minute to answer that question.

[Gordon Lloyd]

Let me take a crack at that.

I fully agree the spectrum needs to be looked at, and it shouldn't be this false dichotomy between strict regulation and voluntarism. There are things in the middle. I talked about using pollution prevention planning, which is something in the middle that needs to be used a lot more.

I agree that Finance doesn't seem to be too interested in capital cost allowance, but it does not approach it from an environmental perspective. This committee has a real opportunity to say yes, this is one of the fiscal instruments Finance should be looking at. They would listen to you, and that is an important tool we need to start making use of. I really hope that is one of the recommendations this committee will look at in its CEPA review report. Environment will say that's not us, it's Finance, but the message would be directed from you to Finance.

[The Chair, Conservative, Bob Mills]

Mr. Calkins.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Thank you, Mr. Chair.

My first question is fairly straightforward and it deals with enforcement again. It seems to be where I like to go.

The penalties set out in this act include a fine of up to $1 million and three years imprisonment if convicted by indictment; $300,000 and six months for summary conviction. What is the maximum fine and prison term ever handed out for a conviction under CEPA in 1999?

[Cynthia Wright]

I can't tell you off the top of my head, but I know it's been going up over the last few years.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Can you give me an average or can you give me roughly what we're looking at? I know everything is based on its own merits and the levels of severity. What are we talking about? Are we close to the top, or are we close to the bottom?

[Cynthia Wright]

I'd say we were in the mid-zone, but we can get you that precise information.

[The Chair, Conservative, Bob Mills]

You can send that to the clerk.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

I'd sure like to know that.

I'm going to start with Mr. Hanneman and go across the panel. Based on those numbers, based on what we've seen here, $1 million and three years or $300,000 and six months, depending on whether it's indictment or summary conviction, do these penalties act as sufficient deterrents?

[Richard Hanneman]

My feeling is the salt industry is not the object of enforcement with regard to road salts. It's whether you want to fine the City of Toronto or the City of Montreal or the province of whatever, and whether or not there's the political will to impose that kind of fine on a sister jurisdiction for a violation when the impact is distinctly local. It goes back to the fiscal instrument. You can't very well give tax incentives to a tax-supported organization.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Fair enough. The pushback on you would be that the municipality would say you sold it to them. There are those repercussions, but ultimately they're responsible for how they apply that.

I sat on municipal council, and so did Mr. Silva and several others around this table, and had to wrestle with those decisions. In Alberta we use the less than 5% blend of salt with sand, and when I came down here, I saw big chunks of salt lying on the road. I'd never seen anything like that until I came to Ottawa.

[Richard Hanneman]

It's a different climate here than in Alberta.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

It's a completely different situation, absolutely.