We've had a chance to review it. I'd like to read into the record some of the conclusions that report reached.
First of all, “Rail service at the level of the terminal operator in the Vancouver area is quite poor”. I can't imagine any other term other than perhaps “abysmal” that would describe that in more graphic terms.
“There is strong evidence...that the railroad level of service to terminal operators has deteriorated in recent years”. It goes on to conclude, “The Canada Transportation Act has too weak a definition of level of service”. It goes on to say, “The terminal operators have stated that they want amendments to the Act to provide legislative certainty that will allow them to proceed with their business and that of Canada under viable relationships with the railroad”.
That's sort of the context in which this played out.
Then I want to move on to an issue that I believe may have been mischaracterized here. First of all, there's a reference in these conclusions to the fact that a number of the terminal operators tried to quantify their losses. The small number that were able to do so quantified their annual losses at $20 million.
They went on to conclude that the railroads have imposed these costs on the terminal operators as part of a drive to improve railroad asset utilization and financial performance--read profits. Quite frankly, I'm a big fan of private business making profits, even when they're big profits. But there's also a social responsibility to reinvest, which I'm sure you've done. In fact, Mr. Mackay referred to the fact that there has been a doubling of investment since deregulation.
They finally go on to say there's a strong market position--I think they're saying there's a virtual monopoly in many areas of the country--and an unbalanced commercial relationship between the railroads and other parties in the transport chain. Of course, that's where final-offer arbitration comes in. It's something the shippers really want badly. It's intended to level the playing field. When an individual shipper has a dispute with a company like CN that made $2.2 billion in 2006 alone, that's not a level playing field. To revert to normal commercial dispute resolution mechanisms to solve those problems is unrealistic.
To the representatives of CN and CP, did either one of your companies ever propose final-offer arbitration in your discussions with the shippers? Was FOA ever one of the suggestions you made as being acceptable to you?