Official Languages Committee on May 30th, 2017

[The Chair, Liberal, Denis Paradis]

Pursuant to Standing Order 108(3), we are resuming our study of Air Canada's implementation of the Official Languages Act.

This morning, we are pleased to welcome Ms. Sara Wiebe, acting assistant deputy minister, policy, and Mr. Daniel Blasioli, senior counsel, legal services, Transport Canada.

You are most welcome. As is usual, we will hear from you for around 10 minutes.

We will then move on to questions and comments from the committee members.

Ms. Wiebe is giving the presentation, is that correct?

We're listening to you.

[Sara Wiebe, Acting Assistant Deputy Minister, Policy, Department of Transport]

Bonjour. Good morning, everyone.

Thank you, Mr. Chair, for the introduction.

Transport Canada's primary mandate is to have a transportation system in Canada that is recognized worldwide as safe and secure, efficient, and environmentally responsible. Transport Canada is committed to putting forward and implementing legislation, regulations, standards, and policies to this end. These efforts are intended to contribute to a strong and competitive Canadian economy. In this regard, I would like to focus on Transport Canada's mandate as regard the aviation sector and its responsibilities under the Air Canada Public Participation Act, or ACPPA.

During my appearance here today, I would like to provide some additional information about the context in which we conduct our policy analysis for the aviation sector in Canada.

I think we can all agree that a healthy Canadian economy is strongly connected to a well-functioning transportation sector. Transportation provides mobility for people and facilitates the delivery of goods to markets at home and abroad.

In Canada, the air transportation sector is focused on the high-speed transport of passengers and high-value, time-sensitive goods over long distances. There are about 770 Canadian air carriers that operate domestic and international air services, as well as 245 Canadian private operators.

In the 1990s, Canada implemented a user-pay policy, guided by market forces, concerning the use and development of air services and infrastructures. The government considered this system the best way to allow airlines and airports to adapt, innovate, stay competitive, and serve the public in the most efficient and profitable way possible.

As a result, Canadian airlines, airports, and their navigation service provider, Nav Canada, function according to business principles and must recover operating and capital costs from users through various fees and charges to remain economically viable.

The operating context in which airlines conduct their activities involves considerable costs related to safety and security in the air and on the ground. The democratization of the airline industry has made our aviation system more complex, owing to the increasing number of passengers and the number of aircraft in the skies.

On the whole, airlines have seen their profits drop—their profits per passenger kilometre—as a result of constant competition and consumer pressure to offer ever lower fares. As a result, the current trend in the aviation sector is that airline companies are looking for new sources of revenue from passengers in order to remain economically viable. According to the 2016 annual report of the International Air Transport Association, or IATA, airlines' profit margins range from chronic operating deficits to limited profit margins, from 1% to 8% in the best years.

Air Canada is the largest airline and the largest provider of scheduled passenger services to and from Canada. Together with Jazz and other regional airlines operating flights on its behalf, Air Canada operates approximately 1,579 scheduled flights per day to 193 direct destinations on five continents, transporting approximately 41 million passengers annually. Air Canada also employs more than 30,000 employees nationwide, and its headquarters are located in Montreal.

Air Canada is a former crown corporation, originally founded in 1936 under the name “Trans-Canada Air Lines” and then renamed “Air Canada” in 1965. Air Canada was privatized in 1988 pursuant to the ACPPA. At the time, the government opted to maintain certain obligations on Air Canada, including the location of its headquarters, where the carrier's aircraft maintenance work is done, and some provisions regarding its statutes and articles of continuance, to name just a few. The ACPPA is administered by the Minister of Transport.

Section 10 of the ACPPA prescribes that Air Canada is subject to the Official Languages Act, or the OLA, and is therefore considered a federal institution pursuant to the OLA. Air Canada is the only Canadian airline that is subject to obligations under the OLA. It has been subject to the OLA since 1969, including part IV, covering the communications with and services to the public; part V, covering the language of work; part VI, covering the participation of English-speaking and French-speaking Canadians; and part VII, covering the advancement of English and French.

Other major Canadian airlines, such as WestJet, Air Transat, Porter Airlines, and Sunwing, are not subject to the same obligations as Air Canada under the ACPPA or the OLA. However, all major airlines must provide safety instructions to their passengers in English and in French under the Canadian Aviation Regulations pursuant to the Aeronautics Act, which also falls under the responsibility of the Minister of Transport.

It should be noted that Air Canada does not receive any direct or indirect funding from the federal government for its linguistic training programs, the language assessments of its employees, or its bilingual communications activities. Nevertheless, the airline allocates significant resources, both financial and human, to develop and maintain its linguistic programs and internal tools to meet its obligations under the OLA.

As Air Canada explained during some of your committee's deliberations, the challenges they face where their linguistic obligations are concerned relate to the availability of bilingual candidates from a recruitment perspective and the dispatch of bilingual personnel in a constantly evolving operational environment.

Last March, Air Canada presented to you a number of measures it had implemented, and described the partnerships it has forged in all communities across the country as regards its linguistic obligations. Despite the difficulties that Air Canada faces with regard to communications and services in French, we can agree that Air Canada has made real efforts in respect of its commitment to the official languages.

I also want to highlight the work that's being done to support the minister's commitment to enhancing the traveller experience as one element of his transportation 2030 strategy. The department and the minister undertook extensive consultations over an 18-month period as part of the Canada Transportation Act review process. We heard from more than 300 Canadian transportation and trade stakeholders, including the provinces and territories, about how to ensure that the national transportation system continues to support Canada's international competitiveness, trade, and prosperity.

We also heard from individual Canadians, in communities large and small, all across the country regarding their concerns about our transportation system. Canadians expressed their disappointment with the experience they faced during their air travel. The minister has committed to improving that experience.

To support this commitment, the minister recently introduced Bill C-49, the Transportation Modernization Act, which is the first step in improving the travelling public's experience. It includes among other things new measures regarding the rights of air travellers, the liberalization of international ownership restrictions, as well as a transparent and simplified approach for approval of Canadian airline joint ventures.

Not only would the changes being proposed encourage more competition and enable better growth; they are also designed to provide Canadians with better service that improves the traveller experience.

I started my comments by talking about the mandate of Transport Canada. I want to be clear that Transport Canada expects all federal institutions under its responsibility to ensure that their official languages obligations, as outlined in the OLA, are met. This expectation also applies to Air Canada. We believe that Air Canada continues to make progress in fulfilling this goal.

Transport Canada, in partnership with colleagues in Heritage Canada, the Treasury Board Secretariat, and the Department of Justice, has been watching closely the discussions of this committee and its review of some of the complex issues being brought before it. We look forward to receiving your advice on these important issues.

I would be happy to answer questions the members of this committee may have.

Thank you.

[The Chair, Liberal, Denis Paradis]

Thank you very much for your presentation.

We'll now proceed to questions and comments.

We'll start with John Nater.

[John Nater, Conservative, Perth—Wellington, ON]

Thank you, Mr. Chair.

Thank you to our witnesses for joining us today. It's always a great opportunity to hear from departmental officials.

I want to start with a quick anecdote, which will lead into my first question.

Typically, I fly Air Canada when I travel back and forth to my riding, and that's London to Ottawa, or London to Toronto to Ottawa, so they're fairly short flights. I've always been very impressed with Air Canada's bilingual staff on those flights. This morning I had to take an alternate route to get back here in time because I was at an event in my riding last night, so I took WestJet. I was quite surprised that on both legs of those flights the flight attendants and at least one of the captains were also fluently bilingual. I was quite pleased and surprised by that, due to the fact that they're not subject to the Official Languages Act. That is, I think, a positive thing to see, and it leads me into my first question.

We know that Air Canada, as you mentioned, is the only one subject to the Official Languages Act, other than for safety briefings. Has the department given any consideration to extending parts of the Official Languages Act to other airlines?

[Sara Wiebe]

Let me start by talking a bit about how WestJet, as you mentioned, even absent obligations under the Official Languages Act, is already providing the type of service that normally you would see on Air Canada, which is subject to the act. I think what we're seeing is that the major air carriers such as WestJet, Porter, and Air Transat, see what their market is demanding of them. On a flight to Ottawa, they see that there is more than likely to be a significant percentage of bilingual or francophone passengers on that flight, and as such, the market drives them to provide that service.

At the beginning of my presentation, I talked about how the government has made a conscious decision to let these airlines function by the market. I think that's a good example of where the market is driving them, where we already have Air Canada as a result of the OLA.

We're aware that the former official languages commissioner did pose the question about extending those provisions to other air carriers, and it's a subject we're studying closely. Again, this is where I think we'll be turning to the advice of this committee in that regard. Again, it's a multi-departmental effort in terms of looking at that issue.

At this point in time, I'll just note that it is something we're studying, and we'll look forward to the advice of this committee as we continue studying that question.

[John Nater, Conservative, Perth—Wellington, ON]

Great. Thank you very much.

In your comments, you talked about the cost of language training that's being undertaken by Air Canada, and your comment was that there is no federal funding that comes with that undertaking. Thinking of other institutions within the federal jurisdiction, whether it's VIA Rail or airport authorities, would I be right in assuming there would be some federal funding there to help with language training, to help with meeting with those official language provisions?

[Sara Wiebe]

I don't think there would be. That's one of the challenges, to be frank, about the obligation with regard to official languages provisions. Air Canada has talked to this committee about all of the efforts they have invested—both human and financial—in terms of fulfilling those obligations. That comes at a cost. I mentioned that the federal government is not providing them with any funding to support that, so inevitably the cost they are expending in support of that obligation does then trickle down to the traveller.

In terms of your previous question, it is one of the elements that we would be assessing in terms of other air carriers being subject to the OLA. What would the cost be and what would be the impact on the traveller? Again, for the traveller travelling in Canada there is already a variety of fees and charges they are subject to, so we're hesitant to consider additional measures that would further exacerbate the cost of travel in Canada. But as I said, it's a multi-departmental effort in terms of looking at these important issues.

[John Nater, Conservative, Perth—Wellington, ON]

In the former commissioner's special report on Air Canada, he recommended a number of new enforcement mechanisms to ensure compliance with the Official Languages Act. I would like to get your comments or thoughts on those and on whether that would be appropriately undertaken by your department. Or would it be more appropriately undertaken by a different department? Where would that rightfully fall in terms of jurisdiction?

[Sara Wiebe]

Again, I think this is one of the areas in which we are currently looking at the recommendation from the former language commissioner. It's a very complex and multi-dimensional issue that certainly would involve my colleagues at the Department of Justice. Again, this is where I would say that we're looking at that issue. We're studying it closely. We look forward to the advice of the committee.

[The Chair, Liberal, Denis Paradis]

Thank you, John.

We will now move on to Ms. Linda Laporte.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Hello.

Thank you very much for being here.

Air Canada's official languages obligations are very important to the committee.

You said earlier that there is a cost. You said that again to my colleague. It has an impact and Air Canada has to deal with it, while WestJet, Sunwing and Air Transat do not have to. At the same time, however, these people are adapting because they see that their clients are bilingual and that the least they can do in a bilingual country is to offer services in both official languages.

Do you think Air Canada is facing unfair competition as a result of its official languages obligations?

[Sara Wiebe]

Yes. You've heard from Air Canada on this issue, and we hear from them as well about the fact that as the only Canadian air carrier that's subject to this, they feel that it's not a level playing field. This is one of the considerations that we're taking into account as we're looking at some of the recommendations from the official languages commissioner.

Again, I think we're trying to achieve that balance between demonstrating the respect we have for Canada's two official languages with the impact that it would have or could have on the future of the air sector with regard to cost.

You're absolutely right, and we're very pleased to see that some of the other major air carriers are already heading in that direction and already providing those services in both official languages, but that then begs the question as to why we would need to extend the official languages provisions to them, given that they're already doing it absent obligations.

These are just a few of the considerations that we're debating as we take a look at this important issue.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

As you say, it is an important issue.

For an anglophone taking a flight between Quebec City and Sept-Îles, I assume that is not desirable if the services are in French only. The same thing applies for a francophone taking a flight outside Quebec when services are offered in English only. This affects me personally.

With regard to the official languages and air carriers, there are two ways of solving the problem. Everyone has to be on the same footing or...

Do you think it would be possible to request that the other air carriers also have linguistic obligations?

[Sara Wiebe]

As I mentioned, we're quite aware that it's one of the suggestions or recommendations made by the former official languages commissioner. We're looking at it very closely. I've identified some of the considerations that we're bringing to that.

Again, at the base of it, as I mentioned in my opening remarks, the obligations of Air Canada with regard to the Official Languages Act are statutory. We expect them to comply.

With regard to the expansion of that to the other air carriers, this is an ongoing discussion between me and my colleagues in the other departments in trying to assess what the impact would be. Again, we look forward to the advice of this committee.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

If I understand correctly, you are putting the onus back on us, asking us what would be best. We are still talking about transporting passengers.

We met with the president of Air Canada in March. He has chaired a number of airline associations, including in Switzerland, which has four official languages. Meeting linguistic obligations did not seem to be a problem in Switzerland, whereas in Canada we have two official languages and it seems to be problematic.

[Sara Wiebe]

This is where you find me in a bit of a difficult situation today, in the sense that I am a representative of only one of the departments that will have a voice and an opinion in terms of the final consideration of the government with regard to this issue. What I'm trying to do is to give you an idea of some of the considerations that we're bringing to the conversation, without speaking on behalf of my colleagues.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Very well.

I will try another approach.

As representatives of Transport Canada, what do you recommend to help Air Canada improve its official languages performance? What are you doing to help the airline improve its performance?

[Sara Wiebe]

This is where I mentioned that with Air Canada we keep an open and ongoing dialogue on a wide series of policy issues, including official languages. What we try to do—and I think you see some of this reflected in the proposal the minister has made in Bill C-49—is identify those policy issues that could continue to ensure the strong viability of our Canadian carriers, including Air Canada. This is where we look at issues such as joint ventures, and where we take a look at other issues such as international ownership.

We're constantly looking at measures to make sure that we strengthen the existing carriers while continuing to ensure competition. In that way, we try to create that broader framework within all of our air carriers, including Air Canada, so that they can continue to grow and prosper and to serve Canadians well.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Thank you very much.

Thank you, Mr. Chair.

[The Chair, Liberal, Denis Paradis]

Thank you very much.

Mr. Choquette, you have the floor.

[François Choquette, NDP, Drummond, QC]

Thank you, Mr. Chair.

Hello and welcome to the witnesses.

We are meeting you at an unusual time, since the Standing Committee on Official Languages is itself in the eye of the storm. As you know, we are in the midst of a heated controversy regarding the likely appointment of Ms. Madeleine Meilleur as Commissioner of Official Languages.

I simply want to inform the committee that I will be introducing a motion later today to gain a better understanding of what is going on with the appointment, the appointment process, and the controversy surrounding the appointment of Ms. Meilleur. This situation is becoming more tense by the day.

[The Chair, Liberal, Denis Paradis]

Is that the motion for which you have given us notice?

[François Choquette, NDP, Drummond, QC]

Yes, Mr. Chair.

That said, let us return to Air Canada, which is still a very important topic.

Ms. Wiebe, no doubt you received this special report in June 2016?

[Sara Wiebe]

Yes.

[François Choquette, NDP, Drummond, QC]

It is nearly June 2017 now, correct?