Public Safety Committee on June 19th, 2007

[The Chair, Conservative, Garry Breitkreuz]

All right, the last questioner is Mr. MacKenzie, please.

[Dave MacKenzie, Conservative, Oxford, ON]

Thank you, Mr. Chair.

To our panels, as I indicated to you earlier, I thought this group would be non-partisan on this issue, and I think Mr. Cullen just proved it with his comment about going back into the previous government, where the issue has been. When I look at some of the information here, I see it's from the regulations from 2002 and 2004, so this has transcended from the previous government through here. You indicated that you've spoken to most of us, and I think we understand the issue. Perhaps this committee can make some recommendations that could go forward.

If I read your options correctly—and certainly correct me if I'm wrong—you've got two options. Either one is an acceptable option, depending on, as Mr. Cullen's already indicated, the different ministries. I suppose some of the concerns are about big companies, small companies, and all those things, but if it is in a tax credit situation, the work is done; it's not a case of somebody getting handed the money and then doing something different or whatever. Certainly your security tax credit, just from a personal perspective, would say that the work is done before the reimbursement, in a backhanded way.

In all of these things—and I think the chair had asked some questions with respect to the handling—when I look at the regulations, there is a vast array of responsibilities on the sellers of ammonium nitrate particularly. That's been known for years and years as an explosive. Where I come from, farmers have been using it to blow out tree stumps and foundations for years. That is somewhat allowed for in what I see in the regulations here; it can still be sold for that purpose, but it has to be very well covered.

Am I right in that regard? This does have a long history. Now, maybe, with some of the security issues, we're getting up to speed on the security of it. Aside from the meth issue and just from the security aspect, this product has been around for a long time, and maybe we didn't grasp the severity of it until we saw the disasters in Oklahoma and, as you've indicated, in London, England, and other places.

[David MacKay]

We're going to a new level. There have been a lot of requirements for handling and safe stewardship to protect the people who are handling it and to make sure there's documentation, but now we're at a whole new level involving outside threats of acquisition for criminal and terrorist activity, as opposed to inappropriate usage or careless usage.

[Jeff Kisiloski]

With respect to your direct comment about ammonium nitrate, there are definitely two grades. There's industrial grade, which will be around forever, but there's also agricultural grade. I think the concerns with the agricultural grade started with the Oklahoma City incident. All of a sudden we're in a new domain. It's not just an agronomic product any more; it has potential. Yes, it's a tremendous agricultural product; it has specific uses and it's great for certain crops, but the potential is there too.

[Dave MacKenzie, Conservative, Oxford, ON]

I don't have any more questions, Mr. Chair, unless the witnesses wish to expand on....

[The Chair, Conservative, Garry Breitkreuz]

I was going to allow them any time they have. If they have any wrap-up comments, that would be good.

I represent an agricultural community, so I'm really pleased that we could fit you in here before the summer break. What you have presented to us is something we need to deal with, as government, as quickly as possible.

If you have any final comments, please go ahead and make them.

[David MacKay]

I'd like to echo that and thank you for the opportunity to be here today. Originally we'd thought we might have to wait until the fall, so the fact that you've picked it up. And I credit individual members of this committee as well for pushing that.

We would like to impart that we absolutely want to work as closely as we can with government to do the right thing here. Doing this thoroughly but promptly is probably of greatest concern. We want to pre-empt any potential incident—but not, obviously, at the expense of economic hardship to a sector.

We don't want it to appear that we're whining, either. Some might say there's a cost of doing business here. And no question, we are prepared to bear, as we have over the years, a great deal of the costs. We haven't come to you often saying that the sky is falling. But we're now coming to say that we're at the tipping point. We just can't afford any more regulatory burden. We need some help to get over the hump.

And it's not just our costs. Really, security upgrades don't drive the bottom line. They don't. They're perhaps of safety benefit to Canadians. We do feel there's a stake for the Canadian government to share here. We also do believe industry should share a stake as well. We'd like to see them at the table, for sure, as a solution. Hopefully we don't spend five years dickering about a number; we could instead actually get something done.

We do prefer the idea of a contribution program. It gives the government the ability to approve or disapprove the eligible expenses rather than leaving it to CCRA to determine whether that's an eligible expense, whether it's depreciated, whether it's immediately written off that year. You can understand why depreciating assets wouldn't be a heck of a lot of incentive for us to make a move. The contribution program is by far the preferred method that we would like to propose. It instantly deals with the situation on a rebate basis.

With regard to the question of what the number should be—in other words, if government were a little bit unsure of whether the costs we present are valid—you have the complete authority to approve or disapprove that eligible expense on an application basis, just like the marine contribution security program. We believe it's ideal. It's an amazing precedent that is exactly tailored to the requirements of the agriculture retail sector. If it's working for agricultural retail, if it's working for port security, why can't it work for inland security?

[Jeff Kisiloski]

Also, I think the beauty of the model is that an application is made for security upgrades that need to be done, it's approved or disapproved right there, the work is done, an auditor from the government comes in and verifies that the work has been done, and the rebate is issued. So it's very quick, very accurate, and has a lot of accountability.

[David MacKay]

We look forward to presenting to your committee our findings, Mr. Breitkreuz. As soon as we have all the appropriate data in place on a report basis, we'll immediately share it with you. That should give us a measurement of where the current members are in terms of infrastructure status, in terms of their proclivity to reach what I call the “threshold of inducement”, and in terms of what it would take to get them to do the security upgrades. We'll be able to quantify all of the different variables in place and give you a more accurate assessment, including actual costs to upgrade these facilities.

[The Chair, Conservative, Garry Breitkreuz]

When I receive those documents, they will become public. The ministers can look at it and deal with it.

I want to thank you very much. I appreciated your presentation.

This is probably the last meeting of this committee, and I want to take the opportunity as chair to thank everybody who has served on the committee. I feel very strongly that when committees are non-partisan, as we have seen today, we get a lot more done. We've dealt with a lot of issues, and I think we have written some good reports.

Again, I appreciated working with you all. I think this is one of the best-functioning committees on the Hill. We don't get into the news very often, and maybe that's why. I want to thank everybody for a great job.

I even had to compliment Mr. Comartin the other day in the House on the wonderful speech he made. You can see how that....

[An hon. member]

Congratulations to our chair as well.

[Sue Barnes, Liberal, London West, ON]

Mr. Chair, we may wish to call some officials on this matter as well, right?

[The Chair, Conservative, Garry Breitkreuz]

Oh, this matter is not over. I don't want to imply that this is the end of it.

[Sue Barnes, Liberal, London West, ON]

That's good. Okay. I just wanted to make that point.

[The Chair, Conservative, Garry Breitkreuz]

Absolutely.

We had invited officials, but we couldn't get them today.

Anyway, this meeting stands adjourned.