Evidence of meeting #15 for Finance in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was part.
A recording is available from Parliament.
Bloc
Daniel Paillé Bloc Hochelaga, QC
How much profit does it make with the privilege that is being taken away from it?
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
I can't answer that question exactly. I can give figures for the 2009 financial statement, but I don't have the annual report recently tabled in Parliament with me.
Bloc
Daniel Paillé Bloc Hochelaga, QC
We know that the Canada Post Corporation makes profits. But is it happy to have a competitor for that portion of its business? Is that taking a sacred cow away from it, a golden calf? What is that taking away from it?
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
That question would really have to be put to the people at Canada Post. I can say, however, that...
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Yes. Canada Post has said there was a risk of revenue loss, as I explained to Mr. McKay.
Bloc
Daniel Paillé Bloc Hochelaga, QC
Is it a risk of lost profits, or of lost losses? This is plainly something important. In fact, announcing that the exclusive privilege will be taken away is one way of saying that competition is going to intensify.
The Canada Post Corporation, and I think it says this somewhere in its charter or its report, has to operate in a financially independent manner. The Canada Post Corporation therefore has to finance its activities responsibly. If its profits go down, it will obviously have to find some elsewhere.
In addition, you told us that all the jobs were protected. That concerns me a little—I am thinking of my colleague Mr. Généreux, who is a businessman. When a company's business is cut back, it's too bad, but generally, there are people who lose their jobs. We are told that the Canada Post Corporation will now have to keep them all, when competition will be growing in one of the markets where it operates, although no one knows whether it is a market from which it makes profits.
I'm also wondering about something else. Since the Canada Post Corporation's head of finance has to find money elsewhere, is he going to increase postage rates in Canada, that I have to pay, for example, if I want to send a letter to my good friend Mr. Wallace, because they will lose the transfers, or the international mailing? There are a lot of questions.
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Yes, there are.
Certainly Canada Post has been aware of the government's intention to change this provision. It was first introduced in Bill C-14 in 2007. Canada Post has been producing corporate plans that have been approved by the Governor in Council since then, so I would say that Canada Post has already taken this into account, expecting that at some point in the near future the change would happen to the legislation.
That said, I have to go back and say again that these companies have been working in Canada and have been active for some 20 years.
Bloc
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Many companies have been doing this. Canada Post has taken legal proceedings in the past to protect its exclusive privilege.
There is currently a stay on an injunction. It has allowed companies in the remail business to continue their operations. That stay has been extended a couple of times, given there was legislation in the House. It is now in place until December 31 of 2010.
Bloc
Daniel Paillé Bloc Hochelaga, QC
Is the government's decision to do that, first, in the Budget Implementation Act, when there is other legislation somewhere that does exactly the same thing... Where does that come from? Could we say, with all due respect, that these companies, that have been here for some 20 years now, have succeeded, by lobbying the government of Canada, in grabbing a little bit of the postal business, and now the first thing they are going to do is say: thank you, what's next?
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
The amendment will clarify the legal status of the industry that has been operating for many years. It will protect jobs in the industry. It will give Canadian business the opportunity to choose amongst providers for international mail service. Canada Post will still be allowed to compete in the international outbound mail business.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
Thank you, Mr. Chair.
Good afternoon. I want to be very sure I understand. Canada Post has already had competitors in this business for over 20 years or about 20 years.
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Yes, that's true.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
That is indeed the truth. I am going to refer to Mr. Paillé, who just said I am a businessman. And I am a businessman.
Given that they already have competition, they know exactly what to expect. They already expect this. We are agreed, they have competition when it comes to remailing outside Canada.
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Oui; on dit “outbound international mail”.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
So they already have competition.
There is a probability that they will lose $40 to $80 million in business out of I don't know how many billions of dollars.
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Yes, that's right.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
Is this a probability they have evaluated?
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Canada Post did that estimate.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
When you're in business and you may potentially lose market shares, you roll up your sleeves and ask how you are going to work to develop that new business or to make sure you don't lose the profit margins you have in various areas.
Do you know how many businesses there are in Canada in this area and how many jobs may be dependent them?
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
The Canadian International Mail Association has estimated that there are hundreds of companies and billions of employees.
Conservative
Bernard Généreux Conservative Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC
Millions..., you're saying...
Director, Portfolio Management, Crown Corporation Governance - ADC, Department of Transport
Excuse me: millions of employees... Thousands.
