Transport Committee on Oct. 19th, 2010

[The Chair, Conservative, Merv Tweed]

Good morning, everyone. Welcome to the Standing Committee on Transport, Infrastructure and Communities. This is meeting number 27. Our orders of the day are committee business.

We have our guests in the crowd now, but I'll ask them to be patient with us for a few minutes. We have a little bit of committee business to deal with.

At the last meeting, Mr. Jean gave a notice of motion. We have that in front of us. I would refer to Mr. Jean to make a comment and we'll proceed.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Mr. Chair, I think what the motion was attempting to do was to fast-track Bill C-20—or Bill C-37—to the point at which it was last left by committee members.

Quite frankly, I'm prepared to do whatever is required in respect of the members' wishes, but I would like to have the opportunity to hear from the new members specifically in regard to their position on it prior to any other issue.

I know that Mr. McCallum hasn't had an opportunity to address the issue itself, and I know that Ms. Crombie was here, of course, when we dealt with the previous legislation. But of course, I would like to hear from Mr. Guimond as well.

[The Chair, Conservative, Merv Tweed]

Before I go to Monsieur Guimond, my position--and I guess the advice I've been given--would be to rule the motion out of order. The background basically says.... What I'm going to say is that when you start a new bill the procedure is to basically start at the beginning. But also, a couple of the amendments that are being put forward are already past the clause 10.2 stage, so we would actually have to open it up to go back to make those corrections.

If anyone else wants to comment, I'm certainly prepared to listen to it.

Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

I have no difficulty with that. I was only trying to make it simpler to save committee time.

However, I do have, from Transport Canada, in both official languages, the differences between Bill C-37 and Bill C-20. I would like to hand those out to committee, but if this is ruled out of order, we're not going to challenge it. We'll deal with it as the committee deals with it, unless other people have a different desire.

[The Chair, Conservative, Merv Tweed]

Are there any comments?

Monsieur Guimond.

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

Thank you, Mr. Chair.

Mr. Jean invited us to share our comments and I thank him for the invitation. But I would like to tell him that I would have still done so.

Mr. Chair, you took the words right out of my mouth, which is not very hygienic on your part. Pursuant to Standing Order 75(1), this motion is actually out of order. But I would still like to hear what Transport Canada thinks about the differences between Bill C-20 and Bill C-37. That would make things easier.

I cannot support Mr. Jean's motion because, first of all, it is out of order, and second, we don't have a choice. I could quote Audrey O'Brien and Marc Bosc, but if we agree unanimously that Mr. Jean should withdraw his motion, it would be a lot easier. However, I want to add that the Bloc Québécois does not intend to reinvent the wheel. We have already heard from witnesses on this bill, which seems quite similar. It is not necessary to go through the process and hear from the same witnesses once again. This committee should try to be efficient. I feel we could proceed very quickly with the clause-by-clause study of this new bill.

As to my not wishing to hear from the same witnesses again, I would need to check some things with my colleague Mr. Nadeau, the member for Gatineau, who is directly involved. Whatever he has to say, I will defer to his arguments on the issue. My main request is not to hear from the witnesses again. Thank you.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Guimond.

Mr. Jean has circulated a document showing the differences between the two bills. We'll let people review that and then proceed when the bill comes forward.

Our second item of business is a budget that was circulated to the committee members. Before the break, we decided to go to La Pocatière to study with Bombardier. We had the budget approved, but because of circumstances we didn't make the trip. This is basically to put it back on the agenda at the convenience of the committee.

What I'm going to ask for is a motion that the proposed budget, in the amount of $14,194 for the committee's travel to La Pocatière in the fall of 2010, be adopted, and that the chair present said budget to the liaison committee.

Are there any comments?

Mr. Dhaliwal.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

I propose the motion.

[The Chair, Conservative, Merv Tweed]

Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

We haven't had an opportunity to hear from Monsieur Guimond, or in fact from the new members, on whether or not they consider this to be a worthwhile trip. I'd just like to hear from them in relation to that first, because last time, of course, we did have the difficulty in regard to our travel. But also, some of the members who said they were going to be there didn't come. I just want to make sure that we're not wasting our time, with a few members coming from the government or the opposition, and that everybody is interested in going.

[The Chair, Conservative, Merv Tweed]

Comments, anyone?

Monsieur Guimond.

[Michel Guimond, Bloc, Montmorency—Charlevoix—Haute-Côte-Nord, QC]

I would be interested in going. But would my colleagues be ready to provide me with reasonable accommodation? I am an MP in the region of Quebec City, and the city of La Pocatière is an hour and a half away from my home. We can plan on going there, but it always depends on Bombardier's willingness to receive us. I personally would prefer a Monday or a Thursday. You talked about chartering a plane for a return trip if it was during the week. It would be great if you were able to meet my request. But the people from Bombardier might only be able to receive us on a Tuesday. Wednesday does not work so well since we have the caucus meetings. Whenever it is, I am in favour of the idea.

[The Chair, Conservative, Merv Tweed]

That was the original plan. This will just authorize the funding of it when we make the final dates available.

So do we have agreement on that...?

(Motion agreed to)

Thank you.

We have two other things, very briefly. Because of the timeframe of 11 a.m. to 1 p.m., I've asked if we should bring in a light meal. I need a motion to do that. The motion would say that the clerk be authorized to order a meal when the committee meets over lunch between 11 a.m. and 1 p.m. Is that agreed?

(Motion agreed to)

Thank you.

The last bit of business is that the minister has agreed to appear on October 28. We will be asking that the appearance be televised, so I'm advising the committee of that request now. Okay?

The last thing I have before we bring our guests here.... Actually, I'll wait until the end of meeting for it.

At this point, I would like to invite our guests to come to the witness table, please.

Actually, while they are getting settled, I'll just advise members again. I sent a memo to the committee members. It was an invitation by Air Transat to meet with the committee, and the date has been set. If you choose to come, we have seven people who have already said yes, but if there are others, we would like to confirm the numbers in the next short while. Thank you.

Welcome to our witnesses today.

Pursuant to Standing Order 108(2), a study of the impact of the Government of Canada's deadline of March 31, 2011, for completion of projects under the infrastructure stimulus fund and the recreational infrastructure Canada program, joining us from the Federation of Canadian Municipalities are Mr. Brock Carlton, chief executive officer, and Gabriel Miller, director, government and media relations. From the Saskatchewan Association of Rural Municipalities, we have with us Mr. Dale Harvey, assistant executive director.

We thank you for being here today. I don't know if you guys have tossed a coin as to who is going to start, but the floor is open.

Mr. Carlton, please.

[Brock Carlton, Chief Executive Officer, Federation of Canadian Municipalities]

On behalf of our 1,900 members, I would like to thank you for inviting us today. This discussion is important for our members. I would also like to say that our president, Mr. Hans Cunningham, was not available this morning, but he sends his regards.

I am going to make some fairly brief remarks so that we have a lot of time for questions and answers. There are really three topics we would like to talk about today. The first is what the municipalities have done to make the economic action plan a success. Next, what is the status, from our perspective today, with respect to the economic action plan, and what are the next steps we think the government should take? Finally, I will finish with a word about what is really our top priority: building a vision for when stimulus is finished.

Before getting to that, though, there are two points I'd really like to underline. One is that municipalities have a huge stake in Canada's stimulus plan. We have been working flat out to make it a success, and we want to put every single dollar to use in the stimulus plan to create jobs and continue building a stronger Canada.

The second thing I want to underline is that we really welcome the recent commitment by the government to be fair and reasonable when it comes to the stimulus deadline.

First, let's talk a bit about what we have achieved. What I remember is that two years ago, Canada fell into the worst recession, and municipalities came forward saying that we were ready to help, that we were ready to play our role in fighting this national crisis.

At that time, FCM produced some research showing that the best way to create jobs and the best way to boost the economy was to invest in infrastructure. In fact, our research said that when fighting a recession, investing in infrastructure is twice as effective as tax cuts. In the weeks before the economic action plan, we produced a list of shovel-ready projects just to demonstrate that municipalities were ready and able to respond very quickly in this kind of crisis. We had the facts on our side, and we were ready to go to work to fight this national crisis.

In January 2009, we applauded the government's decision to make infrastructure a cornerstone of the economic action plan. In the following months, new funding was rolled out in record time, but as in all these programs, there were some challenges. It took time for the government to negotiate funding agreements, design programs, and approve projects in 13 provinces and territories. These challenges created time pressures that we're still feeling and still trying to deal with today.

Let's be honest. There's no denying that we achieved an awful lot in 20 months since the stimulus plan was launched. More than 20,000 stimulus projects are under way. There has been more than $10 billion worth of investment from the different orders of government. We have created over 100,000 jobs. That's more than 50%, or half the jobs promised when the economic action plan was launched.

Where are we today?

I said that municipalities have been working flat out. Infrastructure Canada has been working closely with the provinces and territories to monitor these projects. They found that the vast majority of the projects are under way and are on track. As for FCM, we have been keeping close tabs on our members. We talk to our colleagues in the provinces and territories across the country, and they're all telling us that in most places, most projects are on or ahead of schedule. But there are communities and regions where circumstances have caused delays, such as flooding in Saskatchewan and hurricanes in Newfoundland. These all have an impact on progress toward the end of these projects.

But there are also communities where projects got off to an unusually late start because of drawn-out, lengthy negotiations between the federal government and the provinces and delays in program design and project approval. This is particularly significant in the province of Quebec. Every day, our members in Quebec are working hard towards completing these projects, but many of them are behind schedule, and there will need to be some flexibility provided.

What's next? We continue to work together—federal, provincial, territorial, and municipal governments—to help pull Canada out of this recession. Things have not gone perfectly. This is a highly complicated program to deliver, and this is why we have been calling for flexibility all along.

When it comes to the stimulus deadline, we welcome the federal government's promise to be fair and reasonable. We really have three recommendations for the government for it to live up to this commitment.

First, the government should commit immediately to showing flexibility wherever a community has worked hard and played by the rules but requires more time to finish stimulus projects. It should encourage the provinces and territories to do the same thing.

Second, the government should direct the public service to start working with individual communities to adjust project schedules as necessary.

Third, the federal government must work with the Province of Quebec to develop a strategy for completing stimulus projects in that province.

In conclusion, up until now all three stimulus partners have shown flexibility where necessary. In setting up the program, the government showed flexibility in negotiating with each province and territory a program that fit their particular regional needs. Municipalities showed flexibility by coming forward with a bunch of projects, keeping them alive, and waiting while the program was set up, the agreements were put in place, and the projects were improved.

Now, as we enter the home stretch of the stimulus plan, it's clear that continued flexibility is the key to continued success. But as I said at the start, there's one final thing we would like to underline, and that is the question of what happens when stimulus is done.

We believe that we need a long-term plan for investing in our infrastructure in our communities, a plan that goes beyond the next six months. I'm not talking about more stimulus; I'm not talking about more short-term spending. We know we're into a period of fiscal constraint; we know the coffers are really tight and the lean years are upon us. Thus, we believe it's really important to take this moment to take time to take stock of our long-term infrastructure needs, to start designing the next generation of federal infrastructure programs, and to understand that infrastructure is critical to our economic health and competitiveness.

This period of time gives us a chance to plan so that as the economy strengthens and the resources become available, the resources can follow a plan that is in place and move quickly to support ongoing infrastructure investments in this country. That way, when the fiscal outlook improves, we will be in a position to protect our recent gains and build infrastructure needs to thrive in a 21st-century Canada.

Merci beaucoup de votre attention.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Harvey.

[Dale Harvey, Assistant Executive Director, Saskatchewan Association of Rural Municipalities]

Good morning. My name is Dale Harvey. I am currently the assistant executive director for the Saskatchewan Association of Rural Municipalities, more commonly known as SARM. On November 1 of this year, I'll be taking over the duties of executive director.

President Marit sends his regrets on being unable to make this presentation on behalf of SARM. He is currently making a presentation to the Standing Committee on Finance as part of the pre-budget consultations.

I'd like to begin by thanking the standing committee for inviting us here to share our thoughts on the stimulus funding and the project completion deadline. I'm pleased to have the opportunity to make representations on behalf of SARM and rural Saskatchewan. SARM represents all 296 rural municipalities--commonly known as RMs--in the province of Saskatchewan and acts as the common voice of rural Saskatchewan. All members belong to SARM on a voluntary basis.

We'd like to thank the federal government for the funds provided to Saskatchewan's rural municipalities through the stimulus programs. The funding assisted with various types of projects, such as local road and bridge construction, arena upgrades, water facility upgrades, and lagoon expansions. These projects have provided work for many people in the province and have provided a boost to the local economy.

The majority of the funding allocated to rural Saskatchewan went to local road and bridge infrastructure projects. Local road and bridge infrastructure is vital to Saskatchewan's commerce and industry. As a landlocked province, we have very few transportation options. The province's economy is very much commodity- and export-driven, with agricultural products, potash, and oil and gas being major players. These commodities and resources are almost exclusively located in rural areas and utilize rural municipal road systems to reach their markets.

In 2008, Associated Engineering reported that approximately $567 million over the next 15 years would be required to repair and replace the rural bridge system. In 2009, the AECOM engineering firm reported that approximately $225 million per year would be required to maintain and replace 130,000 kilometres of rural gravel roads.

It's estimated that in order for RMs to fully fund roads and bridges, an additional $389 million would need to be levied from the RM tax base annually. With the expanding economy, these numbers are only going to increase. Rural municipalities do not have the ability to finance this infrastructure by themselves. The continued assistance of provincial and federal governments is vital and very much appreciated.

As you most likely have heard, this past spring and summer in Saskatchewan have been exceptionally wet--not at all ideal for constructing infrastructure. This has delayed many projects that in a normal year would have been finished by now. As well, because of our severe winters, the construction season is short. It's basically from April to October.

We've been monitoring the progress of the stimulus-funded projects throughout the year and we did another survey last week. Because of the recent dry and warm weather we've been experiencing, very good progress has been made on many of the projects not yet completed. We are optimistic that most projects, if not all, will be complete by the deadline. However, there is no guarantee, as we are at the mercy of the weather.

Given this, we support an extension of the deadline for specific projects that cannot be completed due to factors such as weather, and we hope to hear of this announcement in the near future, rather than right before the deadline. SARM will continue to update the committee on the progress of the projects in rural Saskatchewan as they approach the March 2011 deadline.

Thank you again for the opportunity to present before you today.

Mr. Chair, I'm happy to respond to any questions the committee may have.

[The Chair, Conservative, Merv Tweed]

Thank you very much.

Mr. Dhaliwal.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

I would like to thank the members who came out to give us a presentation.

I will go directly to my questions.

Mr. Carlton, how many projects will not be completed by the March deadline? Have you heard from municipalities other than those in Saskatchewan, Newfoundland, and Quebec?

[Brock Carlton]

Our members report to the provincial government and through to the department of infrastructure. We have not put any kind of additional onerous requirements on them to report individually to us.

The numbers we use are the numbers that are collected by the department, and the department says that about 97% of the projects are currently on schedule. We do not have a number on specific individual projects across the country, but the trends have been really clear to us, and I mentioned them in my comments.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

The minister has also made a statement that the department will be fair and reasonable about unavoidable project delays.

Is the department only making a statement or have they put a policy in place to help those projects?

[Brock Carlton]

We've heard the political statements from the ministers. As I said in my speech, we're calling on the government to instruct the department to start those discussions at a very practical level. I'm not aware of any evidence that a practical application of the fair and reasonable commitment has been undertaken by the bureaucrats yet.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

You have made a very good point. You said that stimulus spending is twice as effective as making tax cuts. On the $6 billion in cuts going to bigger corporations, do you think that money would have been better spent on further investment in infrastructure rather than on those tax cuts to bigger corporations?

[Brock Carlton]

I can't comment on that specific question, on the hypothetical nature of it, but our research did say that in comparing tax cuts to infrastructure spending, when looking at job creation as an economic stimulus, the infrastructure spending was twice as effective as tax cuts.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

Mr. Harvey, you said that you had a very good season and most of the projects are going to be completed on time. But on the other hand, you are also saying that it's up to the good mercy of the weather. Can you give us a ballpark figure on the amount that will not be spent because of weather conditions?

[Dale Harvey]

I wouldn't be able to give you an exact number. Through most of the summer, the weather wasn't conducive to building infrastructure, and the majority of the infrastructure we're talking about is outdoors--roads and bridges.

If you've heard anything about farming this year, you'll know that 10 million acres didn't get seeded out of a total of 35 million or 40 million in the province, and another two million were flooded. So you know what kind of summer we've had. We've been lucky this last little while that we've had a window for agriculture, but it's a window to build roads and bridges too.

Our staff talked to one municipality last week, and they're doing--I forget how big the project is--road construction and paving. They finished the preparation work last week, and hopefully they can start to pave next week, but we could have rain and snow any time now.