Natural Resources Committee on Nov. 23rd, 2009

[Paule Brunelle, Bloc, Trois-Rivières, QC]

I have a question about psychological trauma. This clause indicates that it may be compensated. At the last meeting of this committee, last Thursday, it seems to me that the insurers said that they did not cover psychological trauma. I have not had time to read through the blues, but I found it curious that they would have said that.

The bill says that psychological trauma may be compensated, but the insurers said that this is not so. Perhaps I misunderstood. What are your thoughts on that?

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Brunelle.

Mr. McCauley?

[Dave McCauley]

There are damages that insurers can cover, but there are also damages that the government has decided to cover, to make sure that compensation is provided. In circumstances like those, the government is responsible for compensating the damages through reinsurance.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

So the government pays for psychological trauma with reinsurance? That is why the insurers told us what they did.

[Dave McCauley]

Exactly.

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Brunelle.

Mr. Regan.

[Geoff Regan, Liberal, Halifax West, NS]

I view this clause as one that, in a sense, expands coverage. I don't see this as restricting coverage. There are times when economic loss is not covered; for example, when a person loses their job as a result of something else that happens and their business is affected or whatever. This clarifies that in cases where courts might not otherwise accept them as being compensable, they are in fact compensable. I think this is a positive thing.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Regan.

Mr. Cullen, do you have more on clause 15?

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

We're saying that the government is allowing for compensation due to economic loss, and my question references drinking water, or even contamination of soil. One can imagine a farming region where the soil is contaminated. The court assigns a certain amount of compensation for that loss, but would one be able to argue that the loss of drinking water is an economic loss to an individual? That's my concern.

I'm trying to understand where in the bill--if not here--we can identify what are often referred to as economic or biological services, environmental services. In a community, the loss in the value of a home with contaminated drinking water is a very difficult thing to assign. When I look at properties where I live and the difference between a house with reliable drinking water and one without.... It's a problem.

The loss of drinking water to a region with the size of Lake Ontario's water basin, by all anecdotal information, would be in the many billions, would it not, if Lake Ontario were contaminated in the event of nuclear accident? Again, I'm going back to referencing where this bill starts. It says that $650 million should be enough. That's ridiculous. That's what I'm trying to understand.

Could the contamination of Lake Ontario be seen as being caught under clause 15 here? I'm hearing no, that it wouldn't be derived as an economic loss to the City of Toronto....

[The Chair, Conservative, Leon Benoit]

Mr. McCauley.

[Dave McCauley]

First, I think it's a very unlikely situation that all of Lake Ontario would be contaminated as a result of a nuclear incident. On the issue of a farmer's field being contaminated because of a release stemming from a nuclear incident, that would be compensable. His lost wages, as well as the cleanup of his property, would be compensable under the proposed bill, and that's an improvement from the previous bill.

If there were concerns about the level of contamination in a source of drinking water, the damage that would be compensated would be for the measures the individual would have to take to replace that drinking water.

[The Chair, Conservative, Leon Benoit]

Thank you.

Mr. Anderson, go ahead, please.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I was just going to point out that clauses 13 through 18 all talk about the compensation, but clause 17 specifically talks about the costs of remedial measures to mitigate environmental damage. As Mr. McCauley mentioned, that's particularly covered if you're acting under federal or provincial authority, or any direction from them. So that would certainly cover most of these major environmental catastrophes that Mr. Cullen seems to be intent on predicting here.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Anderson.

Madame Brunelle.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

I would like clarification on something. You told us that psychological trauma is covered by government reinsurance. If water is contaminated, for example, does the $650 million ceiling still apply? A court decides. A lot of people will file claims if there is a nuclear incident. I understand that a court decides who gets what.

But, in all those cases, is the ceiling always the same? Whether the money comes from the operator, the operator's insurance, or from the government, is the ceiling always the same? I am not sure if my question is clear.

[Dave McCauley]

Yes. The $650 million amount is the amount of compensation for all eventualities.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

Okay. Thank you.

[The Chair, Conservative, Leon Benoit]

Merci, Madame Brunelle.

Mr. Cullen, is this still on clause 15?

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Yes, sir. I have a small comment and then a question.

In terms of Mr. Anderson's last point about my being intent on predicting disaster—I'm not sure what he said—I meant to say at the beginning of my questioning that the whole reason this thing exists is for the eventuality of a nuclear accident. You don't create insurance for something if it's impossible for it to happen; there's no need for such insurance if it's impossible for the thing to happen.

So I think it's incumbent upon all of us, however distasteful it is, to imagine something going wrong, and then being able to say that if something were to go wrong, the bill we created was the very best possible thing that we could have done, in the event of that accident. That's the reason that governments get involved in this, I would imagine.

So while I'm an optimistic person by nature, I think when it comes to this type of legislation we all have to take on a certain amount of seriousness about making sure we're making the right kind of legislation.

I understand that clause 17 deals with some of the environmental contaminations and the eventual cleanups, which can be extraordinarily expensive. My question on this one is because it is about economic impacts; what I'm trying to understand is the economic impact of something like the loss of drinking water.

I'm not sure, Mr. McCauley, just in terms of your prediction, that contamination of part or all of Lake Ontario is not possible. Could you offer to the committee where you derived that? Is that from studies that the government has done around the sites located near the lake? Why does the government feel assured in that commitment?

[The Chair, Conservative, Leon Benoit]

Go ahead, Mr. McCauley.

[Dave McCauley]

In doing our analysis for the bill, in setting the limit we undertook a study, a kind of risk assessment in terms of what kinds of incidents, what kinds of risk scenarios we should be considering. In effect, when we looked at a worst-case scenario, a worst-case design-basis incident at a facility, in those situations we found that in fact the radionuclides were maintained within the facility, and they were vented in a controlled manner. So it would be unlikely that you would have a situation where you would be contaminating a large water body.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

This is helpful. I know that the government has enlisted an external company in order to review the sale of AECL; it's the Rothschild report that we've heard much about. Was this risk assessment done in-house for the department or was it done as a contract through somebody else who does this type of work?

[Dave McCauley]

Yes, it was done through an external contractor.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

I see. Has the risk assessment study ever been made public? Is there a plan to make that public?

[Dave McCauley]

That study has been made public.