Finance Committee on May 26th, 2020

[Stéphane Lefebvre]

Our federation is currently discussing insurance. There is no reason to believe that we will have any trouble obtaining insurance for our new or existing customers, who we hope will come back to us. There is no indication that we will have trouble in Quebec in this regard. We also provide interprovincial transportation to Niagara Falls, Ontario, and there is no indication that we will have any trouble in that regard.

We are waiting for the borders to reopen, which will allow foreign tourists to return to our country. It will certainly have a significant impact on business activity in our industry.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thank you.

If I could follow up, I'd like to ask Mr. Buy from the Canadian Ferry Association a question.

I was particularly interested in his comments with regard to the wage subsidy program and the notions with regard to the BC Ferry system. It's very similar to what occurs here in Niagara. Our two largest tourism employers are both government agencies, yet they receive no operational funding. Therefore, because they're classified as government operations, they can't get the wage subsidy.

Mr. Buy, can you tell us or indicate to us some of the reception that you've had to your request to be classed as a prescribed organization in order to receive the wage subsidy? I know that is something that we're looking for here in Niagara. We'd like to see that applied as well.

[Serge Buy]

We have had discussions with the Department of Finance and even with the Canada Revenue Agency, which delivers the program. As indicated, in any discussion we've had, the statement was that we made a compelling case for BC Ferries to be designated as a prescribed organization. As I've also mentioned, Minister Carole James and Minister Claire Trevena, the finance and transport ministers of British Columbia, both wrote to their counterparts in Ottawa, Bill Morneau and Marc Garneau. There is no official reply at this point, and to our understanding, this is no longer a bureaucratic process. It is now a decision that will need to be made by the ministers.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thanks for that.

[The Chair, Liberal, Wayne Easter]

Mr. Kendrick, please get back to the clerk on that insurance question.

I just want to follow up with Mr. Buy.

BC Ferries is not eligible for the CEWS, the wage subsidy, at all.

[Serge Buy]

No, BC Ferries is not.

It's a tricky one, Mr. Chair. BC Ferries operates as a private company. It is a private company. The way it is structured is that it has one share that is owned by a not-for-profit corporation. However, when the Government of British Columbia created legislation to make sure that the assets wouldn't go anywhere else, it created a second class of shares, which are the preferred shares, and kept those preferred shares so that the not-for-profit corporation would not be able to sell the assets of BC Ferries. That makes it, under the Income Tax Act, a provincial organization. In any other way, it's not. That's the problem.

[The Chair, Liberal, Wayne Easter]

Okay, that's very good information for us to have.

We will follow up with Mr. Fraser and then go on to Mr. Ste-Marie.

Sean.

[Sean Fraser, Liberal, Central Nova, NS]

Thank you so much, Mr. Chair.

I'll start with a question that I'll pitch to both our transit and aviation witnesses.

One of the things that have been keeping me up at night is figuring out how quickly we're going to be able to safely reintroduce Canadians to their communities and the way that we move around. Short of a vaccine, what is it in your mind that is going to most put Canadians in a mindset where they feel safe to travel, whether it's by bus or by plane? How can the federal government allocate its resources to encourage people to take part in ordinary transportation or transit activities, knowing that they can do so without risk of becoming sick?

I'll go to the Canadian Urban Transit Association first and to Mr. McKenna second.

[Marco D'Angelo]

We have steps under way now to strongly recommend the wearing of masks because we understand that, as capacity comes back, having a full two metres isn't something that's going to be practical to maintain service levels.

We are involved with enhanced cleaning. We've issued more PPE. Many systems are looking at engineering how people board so that there's more contactless payment and so that we keep the operator inside a barrier. We're taking a number of initiatives that we think will help to welcome the public back and rebuild some of the confidence about being in close quarters.

[Sean Fraser, Liberal, Central Nova, NS]

I know we also have a guest from London on behalf of the transit organization. Before we go to Mr. McKenna, perhaps I'll give her an opportunity to comment.

[Kelly Paleczny]

I would just echo what Marco has said. We're certainly looking at everything that we can do to reassure our passengers that public transit is safe. We're looking to install those barriers in London. We're considering things like hand sanitizer on buses, increasing the cleaning and that type of thing. Again, one of the things that transit systems do very well is communicate and share best practices. We continue to have regular calls, looking for ways to navigate through this.

[Sean Fraser, Liberal, Central Nova, NS]

Mr. McKenna, I'm curious about your sector. When it comes to air travel, obviously it's taken a significant hit. Before there is that long-term recovery for the sector, Canadians are going to have to feel safe to board a plane. What's your advice for the sector, and how can the federal government play a role in encouraging Canadians to travel safely?

[John McKenna]

My first thought is that you're right. A recent poll conducted by one of our members indicates that 75% of Canadians say that they're going to be nervous about flying until there is a vaccine. That's really bad news for our industry.

What the government needs to do is work with us to determine how we can best reassure our passengers—and monitor passengers—for the foreseeable future, either through the taking of their temperature or through whatever.... The government needs to work with us to work out the best possible way of doing this that will hinder passenger flow as little as possible. We want it to not come out with measures that would make flying unaffordable. We're looking at various things.

We're hoping to have it all out with government on all those issues. We're just starting to do that.

[Sean Fraser, Liberal, Central Nova, NS]

Mr. D'Angelo, you talked a little bit during your opening remarks about the jurisdictional divide and not wanting that to get in the way of achieving progress. I'm not afraid to take part in discussions around transit. I mean, anybody who looks at the past four years will see that we had the largest investment in the history of public transit in Canada.

In our spending and investments to date, there has always been a partnership with the provinces. I'm curious, though; you do want to see federal leadership. Can you describe to me what you think the appropriate role is for the provinces, which do ordinarily have jurisdiction over transit organizations?

[Marco D'Angelo]

Nobody disagrees that the provinces need to be at the table. Our position is that federal leadership is what will get them there. We have to get to a “yes”. Certainly, the provinces are expressing flexibility in working with the federal government and with cities across the country to keep transit moving.

Everybody needs to be at the table. I think that was our central point.

[Sean Fraser, Liberal, Central Nova, NS]

Thank you very much, Mr. Chair. That's my time.

[The Chair, Liberal, Wayne Easter]

We'll turn to Mr. Ste-Marie.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair.

My questions are for Mr. Buy.

Mr. Buy, thank you very much for your very moving presentation. First, I would like to make a comment on the last case raised, the one from British Columbia. To my knowledge, the Minister of Finance has the authority to change the wage subsidy program, and if the company in question were a purely public company, the government would be able to give it the subsidy.

I would like to come back to the ferry situation on the Ottawa River. I was flabbergasted when you said that, if these companies had been hit by one disaster, they would have been eligible for the subsidy, but because they have been hit by two disasters, the government is letting them down.

Have you asked the government about this, and did you get a response?

[Serge Buy]

We are certainly very disappointed by that situation. Those operators did everything they could to rebuild their businesses after the floods. They suffered large losses after the flood of 2019. We had several members of Parliament and others taking pictures with sandbags. That's great; we now need to move forward and actually support those operators.

They recovered somewhat after the flood, and then the pandemic hit. They were told that because they had no revenues when the flood was there, no, they would not be eligible. I have to say that the department officials I talked to were very sensitive to that situation. They just said they didn't have the authority to change that. It would require a change in the legislation to change that.

The BC Ferries case, as you mentioned, is a ministerial decision, but for the period that you qualify under, I think it's going to be a change in the legislation. We understand that several issues are there for that period of time, with small business start-ups, etc., and we understand that it could be part of a package of changes that you may see at one point. We hope that's done sooner rather than later.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

A change is absolutely necessary because, as you said, these companies have been victimized three times. They have been affected by the floods, by COVID-19, and now by their ineligibility for the Canada emergency wage subsidy. Let me assure you that all committee members are listening to you and that we will put pressure on the government in the House—that is where we can do it, as you say—to change it.

On another note, what adaptation measures are needed to ensure that ferries can continue to operate during the COVID-19 pandemic? Do many changes need to be made?

What would the changes cost?

[Serge Buy]

You know, I'm very interested that you asked that question.

This will be short, because I see Mr. Chair saying that it should be short.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Mr. Chair—

[Serge Buy]

We understand there are discussions for public transit infrastructure for municipalities, etc. We don't want to create a divide in this country between urban and rural regions. Ferries often serve rural regions. We had a gentleman here from Greyhound, which also services intercity and rural regions. We do have to be careful. Whatever is done and whatever package is put in place will have to be comprehensive. It will need to deal with ferries, with public transit and with airlines that serve those isolated communities.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you. That is a very valid point.

Mr. Julian.