Transport Committee on Feb. 5th, 2008

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Mr. Di Sanza, can contracts be given to members of the board of directors?

[Ekaterina Ohandjanian, Legal Counsel, Justice Canada, Department of Transport]

That's a question that comes under the code of ethics. It's judged on a case-by-case basis; the specific facts have to be known in order to examine that question. I don't think this question is contemplated by Bill C-23 or by the Canada Marine Act. It is the letters patent and the code of ethics that apply to the directors, who may perhaps find an answer if specific facts are submitted to them.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

May contracts be awarded to members of the board of directors?

[Ekaterina Ohandjanian]

The general question—

[Lawrence Cannon, Conservative, Pontiac, QC]

The answer is clear: it's no.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

All right.

Obviously, the Port of Montreal has reassured me, because it sees a possibility of expansion. Minister, you must reassure me as well.

We know that the Port of Montreal has no debt, and I wouldn't want it to be penalized with respect to government assistance. I wouldn't want only those that are indebted to be eligible for assistance programs. Can you assure me that all ports will be eligible for the infrastructure programs and that their financial ability to make their own investments won't be considered? Do you view matters differently?

[Lawrence Cannon, Conservative, Pontiac, QC]

Perhaps we should stand back a little. On the one hand, our strategy on gateways and trade corridors is mainly to see the tools we have and, on the other hand, to identify areas of congestion blocking the smooth flow or our trade. That then enables us to make appropriate investments to maintain the competitive advantage that we have in certain fields. This method won't be based on pipe dreams or frivolous ideas. A framework will enable us to say clearly the direction in which we want to head. We grant access to these funds with a specific direct intention. That's the nature of the MOUs we've signed with the governments.

From a geographic standpoint, the Port of Montreal is the second largest port in Canada. It's a major port, and we want to contribute to its development in a complementary manner, so that we can continue to have an advantage in the market that we want to penetrate.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Would the cruise ship marina be eligible for the infrastructure program, or does that still depend on the programs?

[Emile Di Sanza]

That will depend on the program criteria and the business plan that the Port of Montreal puts forward with its partners. The question is also whether the Port of Montreal will want to seek funding for that specific project, because it has access to other funding sources; it has other partners. In certain cases, the ports will fund their projects with their private sector partners rather than seek public sector funding.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Except that they're the ones who decide. Can you orient them?

[Lawrence Cannon, Conservative, Pontiac, QC]

Yes, that's definitely decided as part of a partnership. That's the spirit that we are putting forward here.

[The Chair, Conservative, Merv Tweed]

Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chairman.

Thank you, Mr. Minister, for appearing before our committee. I would also like to thank you and your staff for providing answers to questions. Often answers are not provided to members during visits, and I would like to at least acknowledge that, because you have done so today.

In that document that has been distributed back to us, there is an element I would like to focus a little attention on, and that's the issue of the access to the gateway funds that CPAs will be receiving. The document says it is “contemplated” that the CPAs would have access to this fund. Can you confirm whether there is new legislation required, or is it a decision from cabinet, and is it actually iron-clad that they have access to this fund? Secondly, what other funds are being contemplated for them to have access to?

[Lawrence Cannon, Conservative, Pontiac, QC]

I'll answer the last question first. They still have availability to the traditional funds that were there previously. What we've done here is we've enlarged the tool kit, basically, and we've said under the Building Canada Fund that the categories of, for instance, short sea shipping and other infrastructure programs will be available to the CPAs.

So if I understand your question, Mr. Masse, it's does this mean that you have to pass the piece of legislation to--

[Brian Masse, NDP, Windsor West, ON]

Yes, it's contemplated. It doesn't say they will; it says it's contemplated.

[Emile Di Sanza]

That's simply in reference to the fact that this is proposed legislation.

[Brian Masse, NDP, Windsor West, ON]

Okay.

In that as well, those projects are merit-based projects. Can you give me your definition of what merit-based projects are and give examples?

[Lawrence Cannon, Conservative, Pontiac, QC]

I guess a merit-based project, if you distinguish it from a jurisdictional allocation, is done with the--

[Brian Masse, NDP, Windsor West, ON]

Is it like a road? Because it's coming from border infrastructure funds, I'm a little bit concerned.

[Lawrence Cannon, Conservative, Pontiac, QC]

Yes, it's coming from the gateways, which is not the border infrastructure fund. Let's look, for instance, at the Detroit-Windsor crossing, which is something you're very familiar with. If we look at the corridor structure, what we're doing, basically, with the Government of Ontario, the Government of Quebec, and the federal government is that we've come together, we've signed an agreement, and we've said let's look at those areas where there is the strongest congestion. How should we alleviate within the next 10, 15, 30, and 40 years those areas that are fundamental obstacles to our commerce? That's the whole initiative we want to put forward. Then we will determine, with the provincial governments as partners, where the best value for money is. So if it's determined that in this case we need to put in a short sea shipping arrangement to alleviate trucking on whatever highway, we'll look at it. That's a hypothetical.

That's what I'm saying about being merit-based. It is agreed upon by the levels of government that are involved as partners in this.

[Brian Masse, NDP, Windsor West, ON]

That clarifies to a certain degree the issue.

I guess one of my concerns is that there is no new money in this. You're taking from existing funds. We're adding more players who can draw out of that fund, players identified as having billions of dollars of needs, and they're also in competition.

I'm glad you brought up the Windsor-Detroit gateway. It's the first time you've beaten me to the punch on that, and I thank you for that, and that hopefully means something. We know that we need billions of dollars of infrastructure down there, and the concern is that we'll draw out of this fund in competition with very worthy projects. So I want to hear, basically, whether the government is committed to more money in this fund for the ports.

A philosophical question coming from it, though, is why, under this bill, you even have to give them access to those funds. When we look at the borrowing limits and the long-term debt they can now incur--and this table shows billions of dollars they can now have access to--why would they need public funds? Is it because there are no private investors? Are we concerned about that? Is it a part of the P3s? What is it they need now? Because they have an incredible amount of capital they can now access through borrowing and long-term debt. Why is it that they even need to compete with other border projects?

[Lawrence Cannon, Conservative, Pontiac, QC]

I think, Mr. Masse, it's part of an overarching strategy that has as its objectives to maintain our competitiveness and to make sure that our trade corridors and gateways are basically functioning. So what we're doing here, fundamentally, is adding tools to the tool box.

Let me put it this way. I guess the best example is what we did at Roberts Bank. I spoke to this issue before. It is in the Asia-Pacific gateway. We put forward something in the vicinity of maybe $40 million or $50 million, maybe a little more, which generated over $300 million worth of investment from both the municipalities and the private sector. Basically, we were able to make sure that we had our objectives of seamlessly integrating the transportation network for our goods and products to bring them into the heartland of Canada, into the western part of the country, and of taking care of community concerns, such as whether we were stopping at intersections, because there's this flow of rail cars going through. It was a combined effort. We do need that seed money to, in many cases, get this up and running. So that's the general idea behind this.

[Brian Masse, NDP, Windsor West, ON]

Given that, I have two quick questions, and I don't need lengthy responses.

Given that this is the strategy and philosophy, would you agree to the Auditor General having the ability to audit ports, seeing that they now have public funds? Also, there are issues with borrowing and lending.

Second, would you provide some support measures so that if there is conflict with the municipality over the use of those partnerships, they could veto it or at least have some type of independent tribunal or some type of situation to evaluate it? We've seen down in our corridor that the Province of Ontario is now fighting, because they don't want to actually expedite the funds for the Windsor-Detroit corridor on the border crossing. So would there be some other mechanism for that?

[Lawrence Cannon, Conservative, Pontiac, QC]

I'm a little leery on the veto part, Mr. Masse, because my experience indicates it doesn't foster conducive relationships.

[Brian Masse, NDP, Windsor West, ON]

Maybe it could be some type of mediation.