Thank you, Mr. Bell.
I think your questions could be answered by any three of us on the panel, to be honest with you. We're all in the front-line operating roles. The phase one and phase two audits were effectively a cross-section of the Canadian system. So any one of us could answer, and I think we'll probably all end up addressing some of the questions.
I tried to take quick notes here, as best I could, so hopefully we'll cover the points off.
I think the safety management system exercise, phase one, was very comprehensive, and we worked with the regulators. Through the course of the audit we exchanged views and notes, and at the end there was a draft report put together. This is true for phase one and phase two. I believe that many of our thoughts and ideas were incorporated. I wouldn't say they were all incorporated.
Some of the interpretation and the judgment I think is from their view, and that's fine. We learned from that, and we continue to work with the regulators on all the aspects you've talked about, and I will address some of them here individually.
I think it's important to recognize that we are governed by Transport Canada and the Transportation Safety Board in Canada. Yes, we have operations on both sides of the border, and yes, it's a different regulator in the U.S., but we are governed by very good regulations here in Canada and we work with the regulators on a daily basis. There's an extremely good exchange between the railways, not just CN, but CP as well, and the regulators.
In regard to some of the references you noted about the number of cars being defective or the number of locomotives, I think a good analogy might be a vehicle. You buy a brand-new car and in a few weeks you might have a bulb burned out and that's considered a defect in the regulations. Things like brakes--we could have a brake shoe that needs to be replaced on 100 cars. That doesn't make the train defective, but the brake shoe needs to be replaced, and we recognize that. And we have, again, processes to address the defect points. On the locomotives—they have some systems in there—the microwave could be not working, and that is considered to be a defect. We adhere to the regulations. Yes, there are things that need to be repaired and fixed as they go from point A to point B, and we have a regular inspection process for that.
We have good processes and good technology that support the safety items you've raise, and I think, again, it's an ongoing exercise. As Mr. Creel pointed out, nothing is more important to us than safety. We work very hard on the safety role and we are disturbed when we have safety incidents. It is a service disruption, it is an injury to an individual, it is a disruption to the community. These are things that take us away from what we do best, and that's to move traffic efficiently and for our customers. So safety is something that we're not going to back away from, that we need to continue to improve, and that's in everybody's interests--ourselves, the unions, the communities. As Mr. Creel pointed out, we spend a lot of time with communities; we spend a lot of time with the unions.
In regard to the comment about the disconnect, I think in phase two we have an improving and a very solid base for involvement with employees. We have local health and safety committees, we have regional health and safety committees. The three of us today, actually this morning, came from our policy, health, and safety committee meeting, which the three of us sit on with union leaders from across the country. And we address issues such as these. We talk about the safety audit, the SMS audit, phase one and phase two. Those are things that are important to us as an organization, not just management, not just union, but us collectively.
As Mr. Creel pointed out, we introduced an employee performance scorecard last year, which is an opportunity for us to review with every individual employee--not just management employees, but every individual employee on the railroad--what their contribution is relative to their craft, whether they're a locomotive engineer or a clerk or a conductor. We take them through areas of safety, productivity, attendance, and we have a good frank exchange about things they're doing well, and the majority of them are doing an outstanding job. And there are exchanges of information, and fact-based exchanges where we say we might need to improve there, and we ask for ideas.
So I believe there is a very strong penetration of communication to the individual employee. Can we do better? We can always do better, and we encourage contributions and ideas from everybody in the organization.
Just quickly on the FRA versus TSB in phase two, the Federal Railroad Administration, FRA, in the United States is the governing body. We keep statistics for both the Transportation Safety Board, TSB, and FRA. The reason we keep FRA is that we're a North American company, and we need to be able to compare our performance against North American railroads. The TSB criteria are different. They're actually more stringent in many cases. We keep that data as well. Mr. Creel referred to some of the Transportation Safety Board statistics, which improved from 2005 to 2006.
We could exchange a lot of information, a lot of factual information, that would be helpful. We will try to do our best today to answer those questions for you.
I didn't catch all the notes, and maybe Keith or Jim Vena can answer.