Evidence of meeting #32 for Public Accounts in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was authority.
A recording is available from Parliament.
NDP
David Christopherson NDP Hamilton Centre, ON
I thought the sheriff started it earlier, but go ahead.
Chief Executive Officer, Great Lakes Pilotage Authority
We've started an audit process now of the captains in the domestic fleet. We've completed about 15%. We've looked at about 60 of these individuals. We've looked at their trips, their training, certification, and incident rates, and they are as good as or better than those of our pilots. My comfort is there. With that comfort, I can continue to try to deal with the problem while making sure the public is safe. That's my answer.
Liberal
Conservative
Andrew Saxton Conservative North Vancouver, BC
Thank you, Mr. Chair.
I'd like to thank our witnesses for being here today.
I will share my time with Mr. Shipley, if that's all right.
First of all, I'd like to begin by pointing out that of eight special examination reports, five did not find any significant deficiency. I think this is an accomplishment that should be recognized. It's good news. I'd like to ask the Auditor General, if she would like, to comment on that aspect.
Auditor General of Canada, Office of the Auditor General of Canada
We are pleased to see that the majority of the crown corporations we looked at last year did not have significant deficiencies. I would say that over the 20-some years that we've been doing special examinations there has been an improvement, and the number of significant deficiencies has decreased.
Conservative
Andrew Saxton Conservative North Vancouver, BC
Thank you.
My next question is for Mr. Lemire.
The report that your office sent us says that the GLPA is working with Transport Canada and the major stakeholders to address the deficiencies. I'm aware that in order to resolve the exemption issues the authority has held a couple of meetings with stakeholders. Could you please share with us the outcome of those meetings?
Chief Executive Officer, Great Lakes Pilotage Authority
As recently as this afternoon I think I can report that the industry knows that the status quo is not acceptable, that there needs to be more transparency. I think what we're proposing as regulatory amendments will satisfy the auditor and the Canadian people.
They certainly don't like everything that's being proposed, and the authority doesn't like everything that we're ready to accept, but that might mean that we're getting somewhere.
Conservative
Andrew Saxton Conservative North Vancouver, BC
Can you tell me when you expect to see the regulatory amendments that will address the deficiencies?
Chief Executive Officer, Great Lakes Pilotage Authority
Is that “expect” or “hope”?
Chief Executive Officer, Great Lakes Pilotage Authority
We have a final draft that needs a couple of words changed. It's not a secret that if we don't have consensus with the stakeholders and the pilots and Transport Canada and the authority, we will have a difficult time going ahead with publishing something that isn't resolved. If we do that and there's no resolution, then the minister will have to have another review to try to deal with it.
We're hoping that by the end of the fall or beginning of winter, hopefully in 2009, we can publish the amendment. It's not a wordy amendment. There are probably 25 words that would change. So it will be by the end of this year, we're expecting and hoping.
Conservative
Andrew Saxton Conservative North Vancouver, BC
Thank you.
I'll pass the microphone to my colleague, Mr. Shipley.
Conservative
Bev Shipley Conservative Lambton—Kent—Middlesex, ON
Thank you, Mr. Chair.
I thank the witnesses.
I want to thank Mr. Smith and Mr. Lemire for coming, for making their comments, and for what they've done. Obviously you've been able to move the file forward on behalf of the authority, working with the existing ministers to make it happen.
In terms of the cost of the shipping, from the standpoint of the owners, what does this do to their competitiveness ? I'll let you answer that one first.
The second question I'll ask to the AG. The amendment being proposed by the authority is that this happen within three years. Is that an acceptable time limit for the implementation?
Chief Executive Officer, Great Lakes Pilotage Authority
On the cost issue, again, we're expecting no additional cost to the industry if they avail themselves of a pilotage certificate. If they do not and decide to take the service of a qualified authority pilot, they probably add 3¢ to 4¢ per tonne of cargo. On salt, that's expensive; on jet fuel, it's not. Those are the cost structures, but again, as I said a while ago, we don't expect any additional costs to the industry.
If the costs were prohibitive, they are competing with rail, as ships are moving bulk. You don't move bulk on trucks. There's an attempt to put trucks on ships, but again, there's no cost competitiveness to the ships on this.
Auditor General of Canada, Office of the Auditor General of Canada
Thank you, Chair. Obviously we would like to see this issue resolved as quickly as possible. If three years is the timeframe being proposed by the corporation, we would strongly urge them to continue with the kinds of audit activities they are carrying out to actually see how the corporations...on what basis they say the captains are qualified to do this. They've done, as Mr. Lemire mentioned, about 15%. We would certainly hope they would be able to complete the bulk of them in that time period.
Conservative
Bev Shipley Conservative Lambton—Kent—Middlesex, ON
I just want to go to your presentation, Mr. Lemire, to number 12. It's a bit of a follow-up. Basically it says, “It is proposed that all officers requiring a pilotage certificate after the transition period”—that's at that first round—“will be subject to the Great Lakes Pilotage Regulations requirement of an examination administered by the authority before the pilotage certificate is issued”. Does that deal then with these sorts of non-existent issues around safety?
Chief Executive Officer, Great Lakes Pilotage Authority
I'm not sure what you mean by the non-existing issues around safety. The comment is just that: after the transition period everyone will be exempt, and that will probably put to rest a whole pile of questions.
Conservative
Liberal
The Chair Liberal Shawn Murphy
Thank you, Mr. Shipley.
Just before we go to the second round, I have a couple of issues. Mr. Lemire, you said that in the Quebec incident it appeared in that case that the ship may not have been seaworthy. I know it's not your corporation, but what agency assures Canadians that the ships plying the Great Lakes are seaworthy?
Chief Executive Officer, Great Lakes Pilotage Authority
When a ship enters the St. Lawrence Seaway in Montreal in Saint-Lambert lock, the St. Lawrence Seaway authority itself will perform an examination and survey the vessel to make sure everything is working—anchors, motors, and whatnot. Following that, every time they go into a port there will be what is called a port state control report. If there are items not functioning well, there is continuous testing. I understand under ISO 901 or 902 there's an audit process for that. There's a close follow-up for malfunctioning vessels and whatnot.
Liberal
The Chair Liberal Shawn Murphy
The second issue is that in the auditor's report there has been identification that for the period 2002 to 2007, your corporation incurred an operating deficit of $6.5 million, I believe, which of course is not sustainable, as you know. Can you tell us how the corporation has been doing over the past 21 months and going onwards into the future?
Chief Executive Officer, Great Lakes Pilotage Authority
Those were interesting comments in the report, which we certainly agreed with. They're factual, but there was some missing information. From 1993 to 2001, this authority was successful, fortunately, and generated surpluses over $8 million. Because of those surpluses, we froze our tariffs. Once the traffic started to go down in 2002 or 2003, the authority had an agreement with its main users to use up this surplus, therefore incurring operating losses. In one of the two years where the traffic projections were way off, this authority ended up losing $2 million and $3 million without being able to address that. It was a scheduled loss, and we did quite well at it. How we would plan on working out the future is just that: controlling our costs, watching traffic, and amending our tariff accordingly.
Liberal