Industry Committee on June 10th, 2010

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

But I think we're trying to find some balance here. We all drive vehicles and we all want to be able to get gas at a local gas station. We don't want to have requirements that are so onerous that people stop opening up gas stations. I think there has to be a balance in there somewhere.

[Joan Huzar]

The cost, if I heard it, was between $50 and $200 to have the pumps calibrated.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

So are you suggesting—

[Joan Huzar]

I'm just saying that I don't think that is going to jack the price of my gas up sufficiently that I'm not going to get gas.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Right, but that's in two years. It sounds as though you're suggesting that every two years isn't enough, that maybe it should be every year—

[Joan Huzar]

I don't know.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

—or every six months.

[Joan Huzar]

I don't know enough about the mechanics of it. I don't know how often equipment fails. If it fails every six months, then we probably need an inspection every six months. If equipment normally runs efficiently for 10 years...

I mean, I take it from Measurement Canada that two years is enough; I have no reason not to. I don't know.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

I know my time is probably coming close to an end, but Mr. Boag, if you could, maybe you could clarify this for me.

Failure might be the wrong word, because I don't know that we're talking about a sudden failure of equipment. I think we're talking about over the course of two years. Gradually the measurement system gets a little bit further and further off, the calibration...

[Peter Boag]

Yes. Over the course of time and just with routine wear and tear, the accuracy of a device could deteriorate to the point that it could come outside of the tolerances and standards that currently exist as promulgated by Measurement Canada.

The other point I want to add here is we've been talking about a two-year inspection cycle. That was certainly the recommendation that came out of the 2004 retail petroleum trade sector review. It's what the voluntary standard is now that has been promulgated by Measurement Canada. But actually, Bill C-14 does not specify what that mandatory inspection period will be. That ultimately will be the function of regulations that are made under this act.

Very much, this is enabling legislation, and we look forward to working with Industry Canada staff as they begin the regulation-making process after passage of Bill C-14 to determine what makes sense in terms of the mandatory inspection cycle. Clearly, in our view, that should be on the basis of a solid cost-benefit analysis in examining the magnitude of the problem and what is a balanced approach that makes sense on the basis of that cost-benefit analysis.

[The Chair, Conservative, Michael Chong]

Thank you, Mr. Boag. Thank you, Mr. Lake.

Mr. Julian.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thanks very much, Mr. Chair.

Thanks to our witnesses for coming today.

I'd like to start by asking for some of the published figures that have been around, both in regard to the impact on consumers of shortchanging pumps and in regard to the potential short-changing of consumers even within the legal tolerance, that sort of 30¢ a fill-up.

Do either of your organizations have figures that either confirm or dispute the potential tens of millions of dollars that consumers have been shortchanged or would be shortchanged?

[Peter Boag]

Certainly, CPPI does not have that information.

[Joan Huzar]

Neither do we.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Okay, but I think we all understand that there is a significant impact on consumers.

[The Chair, Conservative, Michael Chong]

Mr. Julian, just so you know, in the last meeting we had on this, Measurement Canada indicated that households in Canada were being shortchanged to an amount of $20 million a year in gasoline, which works out to about $1.50 per household, as there are about 13 million households in the country.

It's about $20 million a year. That was on the record in the last meeting we had about this.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thank you, Chair.

I hope that doesn't come out of my time.

[The Chair, Conservative, Michael Chong]

Of course not.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

I appreciate that.

I'd like to come back to you, Ms. Huzar, and the concerns you have around the bill as it is. You've raised the issue about the size of the actual fine that could potentially be levied. You've also raised concerns, as I understand it, around the potential of appeals to the minister, and you raised concerns around the resources that might be allocated to ensure that this protection is put into place for consumers.

So would it be fair to say that your concern is that the government may not be really stepping forward? There's the bill itself, but there are all of the other necessary resources and the provision of a neutral third party to adjudicate appeals, as well as the size of the potential fine.

[Joan Huzar]

Absolutely. Our concern here is that the way the legislation reads, you appeal to the minister. As an organization that knows a little bit about dispute resolution and advising consumers, we always tell consumers to go to the top, but going to the minister for everything is unworkable, frankly, and probably not the way to go. There are tribunals that could be set up to deal with disputes, and then if there's something wrong, you could take it further and appeal to the minister as a final step.

But there are numerous examples where the government sets up tribunals to hear complaints, such as someone saying, “The inspector is after me and he's not doing his job properly, so who do I go to?” Measurement Canada could set up an appeals process, and then if there's dissatisfaction, you can go to the minister. We're just saying that there needs to be an appropriate intermediate step, which we think would be appropriate.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Yes.

Now, you mentioned this in your brief to the committee: “It is our experience that government often makes consumer protection laws and regulations but fails to provide the resources to ensure that protection”.

Is it possible for you to give us another example of where the resources weren't put into place, so that what might have been good intentions on the surface were undermined by the lack of resources allocated?

[Joan Huzar]

Off the top of my head, no, I can't; my mind has gone totally blank. But in principle, consumer protection works when the laws are enforced, and the laws are only enforced when inspections are made and complaints... We're pleased that this isn't a complaints-driven system; this is an inspection-driven system. That's a plus, in our estimation. But there are how many gajillion gas pumps across Canada...? How many gajillion, I don't know, but it's a lot.

[The Chair, Conservative, Michael Chong]

Ten thousand.

[A voice]

Ten thousand gajillion is a lot.

[Joan Huzar]

The chances of their all being inspected in a two-year cycle are probably slim to none.

So you're looking at, I hope, targeted inspections, and I hope that Measurement Canada is going to devise this technique. The regulations, as you say, will speak to this. We have some concerns about how this is going to happen, and we would like to participate in the regulatory development as well. By definition, it will be a systematic inspection system, but you're not even going to hit every retailer—forget about every pump.

We're talking numbers, and numbers mean dollars. The question is, does Measurement Canada have the dollars to do this? We don't know the answer to that.