Dear Mr. Chairman and finance committee members, thank you for inviting the Northern Air Transport Association to this important committee.
NATA was formed over 40 years ago to support the economic development of northern Canada with safe and sustainable air transportation.
My name is Sébastien Michel. I am the director of flight operations and operations manager at Air Inuit, as well as a member of the NATA board of directors.
Air Inuit is a private entity owned by the Makivik Corporation, employing close to 800 people. We operate a various fleet of 30 aircraft over four types to provide essential services to the 14 communities of Nunavik and one in Nunavut. Furthermore, our network extends throughout the rest of Canada.
In Nunavik and elsewhere, air travel is the means of transportation to and from isolated communities. Air Inuit is a lifeline. It is our mission to support the growing needs and enhance the lives of the people of Nunavik through a number of social, educational and cultural programs. Through scholarships and affirmative actions, we promote access to professional skills. We are especially proud of our Sparrow program. A notable graduate of the program became the first female Inuk captain. A commemorative stamp was put out in her honour in 2017.
I would like to begin this information session by recognizing the efforts of the Standing Committee on Indigenous and Northern Affairs. We are grateful for the Government of Canada's initial funding to support the airline industry.
Today, I will emphasize the importance of further support for northern air operators. Essential services, as well as profitable operations, are required in order to ensure the public health and economic sustainability of the communities we serve. Notably, all NATA members have developed relationships with indigenous groups.
The impact of COVID-19 on the airline industry is well documented. Due to travel restrictions and new quarantine rules, some carriers have been forced to cease flying entirely, but they still carry the burden of overhead expenses. Many other operators have largely seasonal operations and have either carried loss or made investments over the winter months in anticipation of the upcoming summer. Those operators are now potentially unable to resume their operations or face a dramatically reduced demand that is insufficient for recovery. Others are continuing their essential service operations at significant financial losses.
Given the drop in activity, many companies have reduced their flight operations, but they still need to keep air crews and maintenance staff. It is impossible to cover all the overhead incurred with the operating margins of reduced operations.
Despite that, our members still have a strong sense of their social responsibility. However, that is not sustainable. For instance, if Air Inuit slowed down its services, or even suspended its operations, the entire population of Nunavik would be isolated. As private businesses, we are not responsible for funding, with significant losses, the airline services essential to the safety and survival of all Canadians living in isolated northern communities.
Northern Canada accounts for over 40% of Canada’s land mass. The majority of the communities do not have the infrastructure and resources that are taken for granted in southern Canadian cities. Many northern communities have no road access, and with there being only a handful of paved runways, northern air carriers provide a unique and essential component to Canada’s travel network. Northern operators are often the only means of providing access to medical supplies and resources, food and other essential supplies. The demand for these services alone is not viable.
In many cases, the extra work from profitable operations help to sustain regular and essential services. These different operations both support and rely upon each other. Removing one will lead to the collapse of the whole. In order to ensure adequate service, northern operators are compelled to operate flights that a profit-oriented air carrier would cancel. However, our cost reduction measures, in the context of the services we offer, are very limited, and they put significant pressure on the financial capacity of our members.
NATA encourages the various governments to begin the careful restart of the economic initiatives, programs and social activities that are vital to the sustainability and self-sufficiency of Canada’s northern communities. NATA’s air operators are lifelines for the Canadians who call the north their home and who help to secure Canada’s sovereignty across this largely inaccessible region.
In that spirit, we are asking that the government provide the northern airline industry with quick and ongoing assistance, so that the airline industry can overcome the unprecedented difficulties it is facing.