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 do. You say you're still going to be able to achieve the financial results.
President and Chief Executive Officer, VIA Rail Canada Inc.
We will be able to achieve the financial objectives set in this new plan—
President and Chief Executive Officer, VIA Rail Canada Inc.
—which takes into account—
NDP
David Christopherson NDP Hamilton Centre, ON
What I'm looking for is the difference between the old one and the new one, in real terms, on the ground.
It sounds as though you're saying there's none, but I want to be clear.
President and Chief Executive Officer, VIA Rail Canada Inc.
There will be an impact on--
David Christopherson NDP Hamilton Centre, ON
That's what I'm asking, sir. What kind of impact can we, the Canadian public, expect as a result of lowered revenue expectations?
It's likely that you're not going to be able to do everything you were hoping to do based on your original revenue projections. Therefore, my question is and has been, what's the difference between what you were hoping to do between 2007 and 2011 and your targets now, based on new revenue numbers?
Robert St-Jean Chief Financial and Administration Officer, VIA Rail Canada Inc.
It's $200 million over a five-year period.
NDP
David Christopherson NDP Hamilton Centre, ON
But what does that mean? It has to mean that something is not going to happen. You're not going to spend that money on something. So what is it that you're not going to spend the money on?
President and Chief Executive Officer, VIA Rail Canada Inc.
A lot of what we missed is related to the fact that it takes more time. In other words, our equipment is getting older and we don't have the frequencies we would like. Over time, the revenue comes later and obviously creates the gap that we have right now.
Does that answer your question?
NDP
David Christopherson NDP Hamilton Centre, ON
It does and it doesn't. It does in terms of a process, but it still doesn't tell me if it's one train, one station, or one new plan you had that's now not going to happen. That's all I'm trying to determine. It's not a trick question, I just want to know, if you don't have as much money, what are you not going to be able to do that you'd hoped you were going to be able to do?
President and Chief Executive Officer, VIA Rail Canada Inc.
In my remarks I alluded to the fact that the 2010-2014 plan now has a section that deals with the risks that you've raised and the strategies to deal with such shortfalls. We've identified that. We have mentioned to our board that if the situation doesn't improve over the coming months, we will have to seriously consider some service adjustments. By that I mean we'll have to review some frequencies, the operation of certain trains. That's how you deal with it.
NDP
David Christopherson NDP Hamilton Centre, ON
I don't want to put words in your mouth, but I'm trying to understand. Right now, is it dollar management? I'll ask the Auditor General to jump in any time to help make it clear in my mind, but are you saying that by managing your cashflows and stretching out some projects, you really won't affect any major projects?
You're going to have less money, so you're going to be able to do fewer things. All I want to do is determine what you're not going to be able to do that you'd hoped to be able to do. It sounds as though maybe you're managing things in one way, and there's a second phase, and if it gets worse, that's where you'll go.
President and Chief Executive Officer, VIA Rail Canada Inc.
Our capital project is going to be executed as was initially planned. It's important that we do that so that our fleet is reliable.
President and Chief Executive Officer, VIA Rail Canada Inc.
We have the money. The money has been allocated by the government. So the capital allocation--
President and Chief Executive Officer, VIA Rail Canada Inc.
Yes, so the money is there.
The challenge is in view of the revenue challenge we're experiencing now, affecting the years 2010 and 2011. My answer to you was that we said to the board, if we cannot see a significant increase in revenue and the cost base remains the same, there's a challenge for funding. There will be an impact on funding from the government on an operating basis, and the solution to that is to look at your frequencies and your network. Shrink the network, shrink the frequency, so that you do not experience--
President and Chief Executive Officer, VIA Rail Canada Inc.
We're not cutting right now.
NDP
David Christopherson NDP Hamilton Centre, ON
—but you're saying if it continues to get worse, you will be into that phase.
President and Chief Executive Officer, VIA Rail Canada Inc.
Yes, we may have to do that.
NDP
David Christopherson NDP Hamilton Centre, ON
Okay. I think we got there.
You don't have mechanisms to ensure that rail infrastructure owned by third parties is maintained, meaning that you have no control over the status of the railways. A number of us have been raising concerns about safety standards and things that are happening. How are you addressing the fact that you don't have a direct way to ensure that the lines are being maintained to the standard that you would expect?
President and Chief Executive Officer, VIA Rail Canada Inc.
In our new agreements with the short lines, we incorporate a need for them to do regular track inspections and report to us in writing about those track inspections, based on federal standards.
NDP
David Christopherson NDP Hamilton Centre, ON
Do you have a step afterwards, if you're not satisfied?