Thank you very much, Mr. Chairman and members of the committee.
My name is David Bradley, and I'm CEO of the Canadian Trucking Alliance.
Trucking is the preferred mode of freight transportation in Canada. We haul about 90% of all consumer products and foodstuffs, as well as two-thirds by value of Canada's trade with the United States. In normal times the industry employs over 400,000 Canadians, who in turn hail from virtually every community in the country. Of all the transportation modes, trucking is the major contributor to GDP. Trucking isn't necessarily the cheapest way of moving freight, but it's the service that truckers provide--the door-to-door small shipments of time-sensitive freight--that sets the industry apart from its competition. It's been said that the just-in-time inventory system and time-definite logistics systems that are so much a part of our competitive situation today have been built around trucks.
CTA is a federation of the provincial trucking associations in Canada, representing over 4,500 trucking companies from all provinces, of all sizes, serving every industrial sector in the country. Our members are involved in all facets of the business, from short pickup and delivery, local pickups and deliveries, to long-distance, cross-border movements. The intermodal freight system relies upon trucks to start or complete every shipment. Therefore, trucking is perhaps the best leading indicator of economic activity there is. We're a drive-demand industry. As the economy goes, so goes trucking. My members feel every economic jolt. We are usually the first in and the first out of a slowdown, often by six months or more.
While perhaps no one could have foreseen the financial crisis that has rocked world markets in recent months, which has certainly exacerbated the economic situation in North America and beyond, the fact is that the trucking industry in many parts of the country, but starting particularly in central Canada, has been grappling with the freight recession for over 18 months now. The significant deterioration in freight volumes that our industry began experiencing a year and a half or more ago was clearly a harbinger of what was to come for the overall economy, a point we attempted to make in the pre-budget consultations in each of the previous two federal budgets.
Moreover, I can tell you there is virtually no indication that a recovery in freight volumes and therefore in overall economic activity is on the near-term horizon. This fact is reflected in reduced employment numbers in our industry. Last month alone, almost a fifth of the national decline in employment in Canada was attributed to reduced employment--almost 30,000 jobs--in trucking, especially in Ontario. In addition, the industry has witnessed a record number of bankruptcies in both 2007 and 2008 and a significant reduction in the number of trucks crossing the busiest Canada-U.S. border entry ports over each of the last two years. It's now reached the point where volumes are less than they were in the year of 9/11. It is no surprise to the trucking industry that Canada now finds itself in a trade-deficit situation.
The moderation in the price of diesel fuel and the depreciation in the value of the Canada dollar in recent months have come too late in the current business cycle to be of much benefit. Of course the fact is that our biggest customer--the United States--simply isn't buying. So it will come as no surprise that during the consultations on the 2009 budget, we felt that a package of initiatives aimed at stimulating economic activity in the short term was warranted, but we also believed that those measures should be in the long-term competitive interest of the Canadian economy. For example, we welcomed the announcement, on the part of the federal government in concert with the provinces, about accelerating the investment in infrastructure such as highways and bridges.
We believe, however, that infrastructure dollars should be invested strategically. When it comes to highways and bridges, it's important to us that most of the funding go to projects that are part of the country's key economic corridors. We were pleased that a number of the projects recommended by CTA and the provincial trucking associations were specifically mentioned in the budget. In addition to a strategic infrastructure program, we believe there also needs to be a meaningful program of measures introduced to get consumers, both the public and businesses, purchasing and investing again. We acknowledge that the budget contains some modest measures for business, such as the increase in the annual amount of active business income eligible for the reduced small-business federal corporate income tax rate and the 100% CCA writeoff for computers and software. We have also received early positive indications from our vehicle financing companies with regard to the creation of the $12 billion Canadian secured credit facility to support financing of vehicles and equipment for consumers and businesses.
You had to look deep into the notice of ways and means, but the budget also calls for a repeal of an arcane provision of the customs tariff, section 9801.10, which technically, at least, required Canadian trucking companies to pay duty and taxes on U.S. trailers in cross-border moves.
Whether this is enough, in combination with these and other budget measures, to provide short-term stimulus remains to be seen. I can only say that we hope so.
We recognize that there are and will continue to be many demands on the federal government from many sectors seeking inclusion in a stimulus package. I can only speak for trucking. We don't expect government to solve all of our problems, but there is a role for the federal government to facilitate positive long-term change in industries like ours. As I stated previously, the trucking industry is the major contributor to GDP of all the freight transportation modes and as such has a major potential role to play in the economic turnaround. The industry's ability to invest in new equipment, trucks, trailers, and other equipment, not for expansion in these times but to replace older, worn-out equipment with safer and more environmentally friendly equipment, has been severely impaired over the last two years.
We were disappointed by the absence of some other measures that we had been proposing, which we believe are not only justifiable in these difficult times but also justifiable in terms of sound and appropriate tax policy in the country's long-term economic, safety, and environmental goals--