Evidence of meeting #48 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was funding.
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Thank you, Mr. Chair.
First of all, I want to thank Monsieur Laforest for switching time with me because I have to catch a flight, so I really appreciate it. If I leave, it's not because I don't want to hear what you say; it's just that I have another meeting in Ottawa I have to be at.
Very quickly to the Shipping Federation, you represent foreign shippers, as I understand, right?
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
You've come here asking for us to look at the icebreaking capacity or improvements down in the St. Lawrence area, in the south part. If you're showing me a business plan from 2009-2012, why didn't the coast guard itself recognize that issue? I appreciate your providing that to me today. I was looking at it while you were talking. If they aren't recognizing it as an issue, why are you, and why did they miss it?
11:10 a.m.
President, Shipping Federation of Canada
I don't think they missed it; I think there were other priorities that they felt were out there, and I guess the government had priorities for polar icebreakers up in the Arctic. Also, I think it's a question of funding: where are they going to get the money from? So we're here to ask on their behalf for funding so that they can put together a plan.
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
You're not asking us to look at the specifics of it and rearrange their priorities but to ask for more money to move their priority list up.
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
The range that you have in your presentation is quite significant--where the money is from one level to another. Can you explain why there's such a variety?
11:10 a.m.
President, Shipping Federation of Canada
It's a rough estimate, but I guess the easiest way is that to build a ship overseas, there's cheaper labour, more volume, and better facilities to build these kinds of ships. Whether we even have the capacity here to do it is another question, but there's a big difference in the--
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Are your members in the marketplace, buying ships at the present time?
11:10 a.m.
President, Shipping Federation of Canada
No, there are not a lot. There are a few specialized carriers that are buying new ships. However, some of the companies, like container people, are trying to find employment for the ships they have. There has been a huge increase in the number of ships that have come out of shipyards in the last two years, and the market has died.
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Right. So in your view, would it be a good time for us to be out?
11:10 a.m.
President, Shipping Federation of Canada
Absolutely. To look at building new ships, yes. In fact, the coast guard said in its 2009 review that the cost of replacement has doubled from $5 billion to $10 billion, its whole fleet. I'd say that cost would be down now because of the marketplace. People have stopped ordering ships, so it's a prime time.
11:10 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
The balance of my questions are for the Quebec Port Authority. A couple of years ago, Mr. Chairman, I was there with some of my Quebec City colleagues for a tour and a presentation, and I really appreciated the information.
The request that you're making today, is it specifically for your port or is it more of a national port authority program you may be part of?
11:15 a.m.
President and Executive Director, Quebec Port Authority
There are two things. We have to have total financing; otherwise we can't do it. So it's really for our port, but you have to change the approach a bit, because right now in the infrastructure program we have to pay 50%. We can't afford to pay 50% of $382 million, because our top borrowing limit is $54 million. We've already borrowed $25 million twice, and now $30 million, so we're over our limit and we cannot finance that. It's impossible, because we don't produce enough cashflow to build a new wharf, and there will be no expansion if it's not financed by the Government of Canada.
11:15 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
The expansion isn't for container work, it's for liquid shipping—or is it for container work also?
11:15 a.m.
President and Executive Director, Quebec Port Authority
In the business we are in, it's for liquid bulk and dry bulk.
11:15 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Okay. You're not the only port authority, obviously, with a borrowing limit as part of the legislation. I have had other port authorities talk to me about changing those limits in terms of being able to borrow against your assets. If that limit were not there, would you have more capacity to borrow?
11:15 a.m.
President and Executive Director, Quebec Port Authority
Well, we've changed our borrowing limit. We can apply to change it and we've already changed it three times. When we're over our limit, we go back to Ottawa, and they study it and then give us $10 million, $15 million, $20 million, depending on whether or not we can reimburse the amount.
Even if you were to give me the right this morning to borrow $383 million, forget it, because I couldn't pay it back, as we don't generate enough cash to pay back such a large loan.
11:15 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Okay, the next question I have for you is regarding your expansion. Now, I've been to every port except Montreal's, for some reason, as there was an issue that meant I couldn't make it to that one. But the issue often deals with the municipality and the amount of space they have and encroachment into recreational or residential areas.
Do you have that issue at the Quebec City port, where the municipality would rather see it as condos and...?
11:15 a.m.
President and Executive Director, Quebec Port Authority
No, the mayor of Quebec supports the expansion of the port because we already have the land. We went through an environmental study in 1984 and 1985, and we are permitted to extend the port by two wharfs, and after that permission is terminated.
11:15 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
So the EA, the environmental assessment, for that has already been done?
11:15 a.m.
President and Executive Director, Quebec Port Authority
Yes, and right now we are updating our study, but we are allowed to build two wharfs. After that, there will be no more expansion of the Port of Quebec.
11:15 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
For the students federation, I was once the president of the student council at the University of Guelph, and someday you may be sitting on this side of the table, so thank you for your presentation.
You were talking about restored levels of funding. Is that what you're asking to come back, and what amount would that be?
11:15 a.m.
President, Fédération étudiante universitaire du Québec
We are currently asking for $3.5 billion, an amount based the cuts that were made in the wake of the Axworthy reform. If we consider the cuts, the increases and the two transfers that were made in 2009-10, $10.853 billion will have been given to all the Canadian provinces in transfers for social programs. Now, to equate—
11:15 a.m.
Conservative
Mike Wallace Conservative Burlington, ON
Can I ask you a question about that? Where are you getting that number? Our social transfer went up some 3% last year in our budget, so I don't know where you're getting that number from.