Transport Committee on April 28th, 2009

[Rob Merrifield, Conservative, Yellowhead, AB]

It's premature at this stage. Let's get the report out, let's get the reaction and do the consultation with Canadians, as well as all people involved, and then step by step move forward in making sure that Canada Post is sustainable long-term and can compete internationally and nationally into the future in the 21st century.

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

Mr. Baird, nothing is set aside for NAV CANADA. I know that it is an autonomous self-supporting organization, but, Minister, as you no doubt know, NAV CANADA is in the process of conducting impact assessments in a number of airports. In Quebec, the Rouyn-Noranda, Val-d'Or and Lower North Shore airports have been notified that NAV CANADA could conduct a service analysis. That could lead to significant economic losses for these communities. Air ambulances need NAV CANADA's services. Some regions have been told that if service changes were made, their air ambulance service would likely stop.

Have you set aside money for cases where NAV CANADA is short on funds, or will you intervene in the process that NAV CANADA is currently conducting in various communities that use its services?

[John Baird, Conservative, Ottawa West—Nepean, ON]

As I am sure you know, the previous government privatized NAV CANADA. It is not a government agency, but a private corporation responsible for its own operations. I must, however, point out that the Government of Canada has allocated $25 million to NAV CANADA in light of the Vancouver Olympic Games and the numerous security issues surrounding the event.

Sometimes, these proposals give rise to concerns, as in northern New Brunswick and in Quebec. I am always willing to work with communities and their respective members, and to listen to their concerns, even when that member is a Liberal, as in the case of New Brunswick. I am also willing to talk about policies with NAV CANADA's people. Of course, sometimes, with a private corporation, economic concerns have to be balanced with the public interest. It is my job to work with communities and my colleagues, no matter what their political stripe, on issues that concern them.

I am always willing to work with people and communities. I did so in northern New Brunswick. There will still be concerns, whether economic or safety-related, as with the air ambulances, where the public interest is at stake. But it is not just NAV CANADA's responsibility. Sometimes, it is the government's responsibility when the public interest is concerned. Ultimately, we are responsible for addressing all of these concerns.

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

My next question is about high-speed rail.

Minister, you are aware that the American administration has decided to launch a high-speed rail project. They are analyzing the situation in order to better connect communities across the U.S. by means of a high-speed rail system. The first statements in the government's proposal included a link between Montreal and other Canadian cities. We have not gotten the sense that your government wants to pursue this high-speed rail project, which would go a long way toward reducing greenhouse gases.

As you know, the premiers of Ontario and Quebec, Mr. McGuinty and Mr. Charest, want to conduct a study on high-speed rail. I know that you will be participating, but just barely. Will you really assert the Government of Canada's desire to be involved in this major North American project so that Quebec, Montreal, Ontario and the rest of the provinces will be well connected? We would have to express our interest to the American government immediately.

[John Baird, Conservative, Ottawa West—Nepean, ON]

I must clarify that we have not received a specific proposal from the U.S. The Obama administration has made a few comments or suggestions regarding [Editor's Note: Inaudible]. As far as I know, nothing will move forward in the next two or three years. On our end, we have built a solid partnership with the Ontario and Quebec governments. We are absorbing a third of the cost of a study to assess proposals that were made 16 years ago, I believe. It is a matter of studying the numbers and seeing what they represent today. I expect that, 15 years ago, the cost was approximately $20 billion. Whatever the number, we are working with Ontario and Quebec. We are waiting for the results of the study. We want to figure out what the best solutions are. It is not just about reducing greenhouse gases, improving air quality—one of our highest priorities—or establishing a new mode of transportation. We also have to determine what the best investments that we can make are. Twenty billion dollars is a lot of money. In fact, the number may be closer to $30 billion today. Does public transit in big cities represent the best investments? Are the best investments those made by Ontario and Quebec? Is there a way that we can work with the Americans? Can Canadians afford to pay for a high-speed rail system? It will be a lot more expensive than in the case of VIA Rail—as we have seen in Europe and Japan.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Bevington.

[Dennis Bevington, NDP, Western Arctic, NT]

Thank you, Mr. Chair.

Welcome to Minister Baird and Secretary of State Merrifield. I'm pleased that you could join us today. Over the years I've noted, Minister Baird, that you're readily available in committees, and I think that's an admirable trait.

Concerning the Building Canada and infrastructure stimulation funds, many questions are still out there about their proposed way of working. Municipal leaders across the country are very concerned as well about some of the conditions attached to them.

In your letter to the mayor of Toronto, you said that “proponents will be required to attest that the projects would not have been built over the next two construction seasons without the federal and provincial funding.”

Their concerns lie with projects identified in these capital plans not being eligible for funding. That's certainly going to put an extra burden on municipalities in bringing forward projects. As well, projects need to be completely finished by 2011, under your proposed rules. This will present difficulties to municipalities in coming forward with plans and projects of a type that is going to be acceptable and will not, as your finance minister..., be clawed back from municipalities through the gas tax in years to come, if they don't follow the regulations.

Perhaps you could give us a bit of an understanding of how the stimulus money for these new projects is being handled.

[John Baird, Conservative, Ottawa West—Nepean, ON]

Certainly.

I'll just underline very quickly the gas tax rebate, the GST rebate, and under Building Canada the base funding. Under Building Canada, there is great flexibility as far as timing is concerned.

In the design of the approximately $12 billion worth of stimulus funds, we wanted to basically stimulate economic growth, stimulate job creation in the short term. We have three fundamental principles. They're not complicated. Some object; some are not in agreement. I would be dishonest if I didn't say that.

One is that we want it to be a new project. We don't want to say, if city X was already going to do something this year or next, that they simply take out some of their money and put in other money, because then we wouldn't be creating any new jobs. We want to create new jobs, so we want it to be a new project, something that otherwise wouldn't be going ahead anyway.

Two, we want to create jobs over the next 24 months with this program. We know from the past 25 years that there can be great...particularly with big projects. Even in building a subway it can take two years from the time you get the yes on the money to when you get the shovel in the ground. We don't want to simply say to the unemployed that they have to wait two years, so we're looking for projects that would start this year and be completed by the end of next fiscal year, which is March 2011, 23 or 24 months away.

The third fundamental point is that we get matching funds whenever possible. We won't get them in every case, but if we can take $12 million and turn it into $24 million or into as much as $36 million by going one third, one third, one third with the provinces and municipalities, we can create up to three times as many jobs and up to three times as much economic spinoff.

Many municipalities that are having concerns.... I'll give you an example. As of noon today in Ontario, we've received 474 project proposals from 69 municipalities, totalling about half a billion dollars. That shows that a lot of municipalities are ready to go, have funds matched, and can meet the criteria.

Building Canada is also on the table for those projects that would be longer-term, that would go beyond March 2011.

[Dennis Bevington, NDP, Western Arctic, NT]

But what you've outlined is that it's going to weigh heavily on municipalities when they can't match up projects to that kind of description. You're starting now. You're not likely to see many of these projects go ahead this year, if you consider the full cycle that a municipality has to bring a capital program forward, one that didn't exist two months ago. A whole series of events takes place around getting that forward and into the market.

You need to find some ways to make this program more accessible.

[John Baird, Conservative, Ottawa West—Nepean, ON]

I'm going to, with great respect, disagree with you. Municipalities are up to this challenge. They have hundreds of projects right across this country for which they have the money, they have the projects, and they are going to be able to go this year and complete them by next year. We will have to turn municipalities down, they are so ready to go in this regard.

But it's not all municipalities. Under the stimulus fund, the YMCA can apply, the United Way can apply. We can also spend it on federal action.

[Dennis Bevington, NDP, Western Arctic, NT]

Certainly, Mr. Minister, some of the announcements you made in my riding.... The Minister of Health announced the Kakisa River Bridge project, but that bridge was started two years ago.

[John Baird, Conservative, Ottawa West—Nepean, ON]

That's under the base funding.

[Dennis Bevington, NDP, Western Arctic, NT]

When are you going to make the announcements on these new projects?

[John Baird, Conservative, Ottawa West—Nepean, ON]

That's under the base funding, which is quite permissible.

[Dennis Bevington, NDP, Western Arctic, NT]

Yes.

[The Chair, Conservative, Merv Tweed]

You have a minute left.

[John Baird, Conservative, Ottawa West—Nepean, ON]

I'll be meeting with the minister from the Northwest Territories either later this week or next week.

[Dennis Bevington, NDP, Western Arctic, NT]

Many of the northern and rural communities face capacity challenges, funding limits, and limits to construction seasons. Are you considering giving these types of communities a little more leeway on what you're proposing to do? If these communities find they can't complete the project in two years, are you then going to take the money back in terms of reducing their gas tax allocation?

[John Baird, Conservative, Ottawa West—Nepean, ON]

No. It's not their money; it's the taxpayers' money. We are asking for projects that can go forward in the next 24 months. I am confident that we'll be able to get more than enough projects around the country that can meet these criteria. I would be dishonest if I didn't say that some projects are on a provincial asset, like GO Transit or a provincial highway, where it's 50-50. There will be the odd project where it's 100% federal if it's in a port or airport that is eligible for the funds. The overwhelming number will be a third, a third, a third.

I'll give you an example. The United Way in Toronto has a great proposal with respect to youth community hubs. Roy McMurtry and Frances Lankin have been lobbying hard on that. They can raise a third, and they're approaching the province and us. I think we're going to have lots of proposals.

I just got one from your colleague from Thunder Bay--Rainy River, who's got a great project that will help Toronto and his riding, and it's currently under consideration.

We will have a surplus of requests, which shows you how dynamic, flexible, agile, and eager municipalities are to help create jobs.

[The Chair, Conservative, Merv Tweed]

Mr. Mayes.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Thank you to the minister for being here today.

First, before I start with some questions, as the member for Okanagan--Shuswap, hearing this from my staff, I just want to ask the minister to pass on to his staff the great cooperation and communication they've had with my riding. It's been very successful and informative. We've had timely response and we've had some great results, so thank you very much for the work that's being done.

One of the challenges of getting infrastructure money out, of course, is partnership, cooperation, and not only from the local governments, but also the provincial and federal governments. I don't know if it's just because of the pending election in British Columbia, but I'm happy to say the Province of British Columbia has really stepped up to the plate and moved forward quickly to get these announcements out.

I just want to tell you a little bit about the ground successes of what's happened in our community. Highway 97 and 220 kilometres of the Trans-Canada Highway run right through my constituency. We have signs up all over, projects have started, people are at work. In what I call the triangle of Kamloops, Revelstoke, and Kelowna, we have about $200 million worth of highway construction, which is something we've been waiting for for some time, and this is very timely. It's going to have some great benefits in the future for my constituency, so thank you very much for that.

One of the things the Province of British Columbia has done is worked with the ministry and also with their local communities. They've split out the towns of populations of 100,000 or less or 15,000 or less and they've set up what they call Towns for Tomorrow and Locomotion. What they're trying to do is just what my colleague, Mr. Bevington, mentioned about the one third, one third, one third. Some of the smaller communities have challenges bringing up that one third, so the Province of British Columbia, in cooperation with the federal government, has allowed for 80% funding for communities under 100,000, and then 100% funding for communities under 15,000. You can appreciate if a small town as I have in Lumby, with a population of about 2,000 people, raises the taxes 1%, they only get $10,000, and that doesn't buy a lot of infrastructure. So they are now building an $800,000 bridge because of the work we're doing as the federal government and the province of British Columbia.

Those are great success stories on the ground that are happening in my constituency, so I think it is working.

In that respect, are any of the other provinces moving forward with innovative ideas on how we can get this money out and helping local government, especially the smaller communities, not the larger communities?

[John Baird, Conservative, Ottawa West—Nepean, ON]

They are. Some of the smaller communities do have challenges. They can use the gas tax money or their GST rebates, among other initiatives.

Some provinces have been incredibly quick. I have to say, British Columbia, Gordon Campbell's government, is a pleasure to work with. They move very quickly, and I think that serves people in British Columbia well. Gary Doer's government and his Minister Ron Lemieux work incredibly well with the federal government. I can say that we've had a great relationship with Minister Normandeau in the province of Quebec. We're moving quickly.

We've managed to put aside politics in Ontario, where I was the critic of the infrastructure minister only three and a half years ago. In the Ontario legislature, we're getting things done. We have seen a significant number of examples where people really are responding to the challenge and moving quickly.

Shawn Graham's government in New Brunswick came out with an infrastructure stimulus plan in December and are great partners with us.

So I think this economiclally challenging time is certainly bringing the best out in people.

We do have programs for municipalities as well, with respect to some very low-interest loans, which Minister Finley announced.

Obviously we don't have much money federally either. We're borrowing money. So are most provinces. Maybe not socialist Manitoba, where they are running a surplus, but most provinces are running deficits. We do have a program that can provide some low-interest loans to municipalities, which provides another measure of help, which is, I think, good news.

[Rob Merrifield, Conservative, Yellowhead, AB]

I could report on where Alberta and Saskatchewan are with that. Particularly in Alberta, we're seeing a considerable amount of interest by the municipalities, and actually what Mr. Bevington has suggested is not what I'm seeing in Alberta. In our first round of opening up in the community component, there has been over $400 million applied for. This is money municipalities are stepping up with, and they are prepared to put their money into projects. We're getting all set to roll out a significant number of those dollars into communities right across the province.

In Saskatchewan there is the same sort of thing. There will certainly be many more applications than there is money to be able to fill them.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

I have a question as far as the municipal rural infrastructure fund goes, for instance. It's one third, one third, one third. A local government has the opportunity to also piggyback Building Canada funds on that. Is that correct? Can you just explain that?

[John Baird, Conservative, Ottawa West—Nepean, ON]

That's correct.