Finance Committee on May 12th, 2010

[John McKenna]

Absolutely, sir.

Air transport finds itself in this situation with regard to all its financing. Financing for improved infrastructure is also borne by users. All financing for air transport comes from users. Nothing comes from the government.

For us, this is a net loss, in that the money we collect goes into the government's coffers and we receive nothing in return.

[Daniel Paillé, Bloc, Hochelaga, QC]

In theory, one could say that if no passengers left airports, no charges would be collected, and even if there were only departing passengers, we would nevertheless need security.

[John McKenna]

We don't at all dispute the need for security. We're asking why the government collects more money than it needs for aviation security.

[Daniel Paillé, Bloc, Hochelaga, QC]

All right, very well. But you'll also understand that, with this bill, the government has served up a mishmash and we find ourselves with a real stew of numerous subjects that must be discussed. So I have to immediately move on to the case of Canada Post.

You're in an odd situation, madam. You tell us in four minutes how much you oppose the government's intention and, in the last minute of your presentation, you respond on all fronts.

[Susan Margles]

Oh, oh!

[Daniel Paillé, Bloc, Hochelaga, QC]

Your laugh is significant.

If I understand correctly, given the revenue you will lose as a result of a decision by your shareholder, to retain the profitable universal service—which is the corporation's objective—you'll necessarily be obliged to increase residential and other rates.

[Susan Margles]

No, I wouldn't say that. We're going to do a lot of things. We are already halfway through the postal transformation process. We're changing the way we process and deliver mail. We want to have the capacity to modify our cost framework to make it more flexible when there are changes on the revenue side.

[Daniel Paillé, Bloc, Hochelaga, QC]

But that's called productivity gains. You would have made them even if you hadn't lost the $80 million. As a manager, you would have increased productivity.

[Susan Margles]

Definitely.

[Daniel Paillé, Bloc, Hochelaga, QC]

So I'll come back to my question.

[The Chair, Conservative, James Rajotte]

You have one minute left, Mr. Paillé.

[Daniel Paillé, Bloc, Hochelaga, QC]

Let's say a minute and a half.

You're going to lose a sum of money and, if you want to keep your books balanced, you'll have to increase rates in order to maintain the same revenue.

[Susan Margles]

No, because we can go after other revenue in other market sectors. Perhaps we can increase the number of our clients in the parcel or direct marketing sectors.

[Daniel Paillé, Bloc, Hochelaga, QC]

If you asked the same question from a union perspective, do you think the corporation would be obliged to increase its rates because it would lose some of its revenue to the private sector?

[Hassan Yussuff]

Well, we believe that if you do lose revenue, you're going to have only two choices: you can cut services or reduce services or reduce the size of the workforce. I don't think Ms. Margles can say with certainty that this will not have an impact, both on the services and on the number of people working at Canada Post.

The reality is that they don't know. We are predicting that obviously there is going to be a consequence of this and that consequence will grow as the market...and as Canada Post, having to compete, loses business.

[The Chair, Conservative, James Rajotte]

Merci.

Mr. Hiebert.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Thank you, Mr. Chair.

Just to continue the conversation about the remailers, my first question will be to Mr. Elliott.

How many small businesses operate as remailers? I know you said there were lots, but I didn't hear the number.

[Bob Elliott]

We don't have a number on that. Of the 7,200 printers in Canada, there is a growing portion getting into the remailing business. A number of mail houses that exist in the business aren't covered by our association. A number of international remailers are also part of this business but aren't covered by our association. I don't even know for sure how many people are in that business.

As I say, it's growing all the time, because businessmen are constantly looking for new niches to get into. They see that the mail business—not only international mail, but the mail business and offering services to their clients—can be profitable and is good for them.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

If you had to take a guess at it, if there are 7,200 printers, would 25% of the printers be in the business? Would it be 50%? Just give rough numbers.

[Bob Elliott]

Barry, do you have a suggestion?

[Barry Sikora]

I can talk about British Columbia, okay?

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Sure.

[Barry Sikora]

In B.C., in the Lower Mainland, we have 10 top printers that do about 75% or 80% of the business. Out of those top 10 printers, every one is involved in the U.S. market in doing printing and sending stuff through the mail to the United States.

So is it significant? Yes. Damn right it's significant. It's probably, I would say, 25%, okay? And if you look at the Canadian border, you'll see that all of our major cities are near the border. We do a lot of business...90% to 95% of our international mail goes to the United States. The numbers are huge.

[Russ Hiebert, Conservative, South Surrey—White Rock—Cloverdale, BC]

Okay.

Let's just look at those 10 top printers in the Lower Mainland, where I'm from as well. How many people would they employ?

[Barry Sikora]

How many people would they employ...?