Evidence of meeting #7 for Industry, Science and Technology in the 43rd Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was crtc.
A recording is available from Parliament.
11:45 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
Retail wireless rates are not based, in a regulatory sense, on cost. We don't rate regulate wireless rates, so I can't speak to what the delta would be....
Sorry, Madam Chair.
11:45 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
You may know that we addressed this question, at least in part, in a submission to the expert panel that reported on last year. The issue of support structures is critical. The question of jurisdiction about them is complex, and frankly not something that the commission can decide. There are some complex constitutional issues involved. There are municipal rights involved. There isn't a simple answer.
Fundamentally, if you are asking if it's a problem that there are divided jurisdictions, it's a problem in the sense that you need multiple approvals and it takes long and it's complicated. It does slow down or is a barrier to deployment. We do have an open process that is looking at that issue.
11:50 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
Generally speaking, the way we ensure or promote competition in areas where there is only one or a smaller number of providers is to allow resale, to allow access to third parties to then provide service using their facility.
I'm sorry, Madam Chair.
11:50 a.m.
Liberal
The Chair Liberal Sherry Romanado
Thank you so much.
Our next round of questions goes to MP Masse.
You have the floor for two and a half minutes.
11:50 a.m.
NDP
Brian Masse NDP Windsor West, ON
Thank you, Madam Chair.
I want to make sure my question is not taken out of context, because I think the regulator is critical for Canadians. When we've looked at the models that have been presented by the government over the years, the end result is that we have amongst the highest cost per gigabyte in the world. Is that not an indication that the regulation we have right now has not been sufficient in protecting consumers?
11:50 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
Can I just ask quickly for a clarification? Are you talking now about wireless service?
11:50 a.m.
NDP
Brian Masse NDP Windsor West, ON
Yes, I'm talking in particular about wireless service. Again, this is more of a policy question than it is about putting blame on any particular component. It's more of a policy question. It's what we've got, at the end of the day, and I don't think what we've got right now is a good spot in terms of cost-effectiveness for Canadians.
11:50 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
I'll try to answer quickly so that I don't use up your time. I think there are a couple of factors. One, comparisons are hard. I mean, there are just so many factors; we do need to look at them carefully.
You are right that we have higher prices. We also, though, have a very high standard of coverage: 98% of Canadians have access to LTE, the latest and most modern technology. That's not true in many of those countries, including our neighbours to the south. We have a problem about pricing and affordability. That is what we are focused on at the moment in our major review of wireless.
11:50 a.m.
NDP
Brian Masse NDP Windsor West, ON
Fair enough.
Do you believe, though, that there has been enough...? Here is the thing: Governments have collected over $22 billion from spectrum auctions. Has that policy of collecting money and then trying to do smaller programs and services later been effective, or is CRTC of the opinion that our spectrum auction is more geared to actually covering Canadians and keeping prices lower than to actually taking in money and then hoping things work out later?
11:50 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
The CRTC doesn't have a view about how the government should allocate funds in that sense.
I guess the important point in the question is that if you took $22 billion from any source and directed it to the problem, obviously it would have a big impact, but it could have come from any source.
11:50 a.m.
NDP
Brian Masse NDP Windsor West, ON
Thank you for that.
Thank you, Madam Chair.
Thank you to the witnesses.
11:50 a.m.
Liberal
The Chair Liberal Sherry Romanado
Thank you.
Our next round of questions goes to MP Sloan.
You have the mike for five minutes.
11:50 a.m.
Conservative
Derek Sloan Conservative Hastings—Lennox and Addington, ON
That's great. I thought I had only two and a half, so that's perfect.
Perhaps I can summarize the August 29 decision. It may not be a perfect summary, but basically it was decided that the large carriers were overstating their costs or essentially gouging wholesale providers, and this decision corrected rates based on evidence, and ordered repayments for the past three years.
In that report you used the words “very disturbing”.
I am just wondering, in regard to a decision like that, which I think is very important in the context of providing Internet service to Canadians, why not implement those rates now, even though you're doing a review on it?
I understand that while the case was before the Federal Court of Appeal, the court suspended the implementation of these rates, but since the Federal Court of Appeal has essentially confirmed those rates, why not put them in place now, pending the outcome of this review?
11:55 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
Thank you for the question. I think it's important that I just quickly recharacterize what our decision is.
We had a large process whereby we received multiple submissions about what the correct costs were. We established interim rates while we deliberated on those, and ultimately we chose costs that resulted in reductions to the proposed costs filed by the incumbent companies. The interim rates, once they're made final, go back to the first point and parties are made whole. I just characterized it slightly differently.
As to the issue of why they're not in place, as you mentioned the courts had a stay until recently. In the applications for review and vary made to us, there were also requests for a stay. We didn't address those at the time because there was a stay imposed by the court. Once the court removed its stay, we had to consider those, and based on the applications made before us, they met the test and we granted the stay until we finish our work.
11:55 a.m.
Conservative
Derek Sloan Conservative Hastings—Lennox and Addington, ON
Would it be true to say that the decision that was made in August, 2019, in terms of wholesale rates has never, in fact, had implementation in the real world?
Was there a time in which those rates were applied before the stays were put in place?
11:55 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
The interim rates had been in place, and then the commission made rulings on final rates. Those final rates have not been put in place.
11:55 a.m.
Conservative
Derek Sloan Conservative Hastings—Lennox and Addington, ON
The decision in August, 2019 was an interim decision?
11:55 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
No, the August, 2019 decision was on the proposed final rate.
11:55 a.m.
Conservative
Derek Sloan Conservative Hastings—Lennox and Addington, ON
Right, so they have not been implemented yet.
11:55 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
No, because they went to the courts and obtained the stay, and then we granted a stay recently while we complete our review and vary application.
11:55 a.m.
Conservative
Derek Sloan Conservative Hastings—Lennox and Addington, ON
Right.
I want to ask you a further question.
You've mentioned a few times that the CRTC is a quasi-judicial, independent body. Your activities are subject to government direction through various ministers, including the Minister of Industry. In the press release by Minister Bains on August 15, he characterized the decision made in August, 2019—and I'm summarizing again—as not entirely correct in terms of the balancing act.
Would you guys at the CRTC look at that press release and view that as government direction, or is your decision-making process entirely independent of that relationship?
11:55 a.m.
Chairperson and Chief Executive Officer , Canadian Radio-television and Telecommunications Commission
Our decision-making process is always independent. The government has the power to review and vary a decision, or they could send it back for reconsideration. The order in council that was issued at that time didn't do so. It acknowledged that the matter was in front of the CRTC, and it is, and we're continuing our work.
