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Evidence of meeting #44 for Transport, Infrastructure and Communities in the 40th Parliament, 3rd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was aveos.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Louise-Hélène Sénécal  Assistant General Counsel, Law Branch, Air Canada
Michel Bissonnette  Senior Director, Engines and Airframe Maintenance, Air Canada
Joseph Galimberti  Director, Government Relations, Air Canada

12:10 p.m.

Liberal

Sukh Dhaliwal Liberal Newton—North Delta, BC

Okay. I'll pass my turn now to Mr. Byrne, please.

12:10 p.m.

Liberal

Gerry Byrne Liberal Humber—St. Barbe—Baie Verte, NL

I think the question we're wrestling with here is the nature of the relationship between you, Air Canada, and Aveos.

It would appear to me, in my paralegal mind, not my lawyer-like mind, that you've assigned an agent to fulfill your obligations under the act, and this is where it gets murky. You have an agent now who's doing the maintenance, not Air Canada. The Air Canada Public Participation Act only applies to Air Canada; therefore, Aveos cannot be held liable or held to any standard within that responsibility. Aveos does not have any responsibility.

I'm trying to bridge the gap as to whether or not you structured a relationship with your agent in terms of fulfilling your commitments. It appears to me that you did not.

So I would agree with Mr. Jean that's it's a terribly drafted law, in that it's not inclusive of the intent of Parliament at the time. You're leaving me with the sense that we need to amend the law and actually hammer down how you deal with your agents, so that this confusion or ambiguity can't be allowed to continue.

Do you have anything you could offer us as to how you structure your relationship with your agents so that we can feel confident, above and beyond your simple statements about being in compliance, that there are mechanisms to make sure you're in compliance?

12:10 p.m.

Assistant General Counsel, Law Branch, Air Canada

Louise-Hélène Sénécal

Well, the relationship with Aveos is not one of agency. They are a supplier to us of various services. The obligations are on Air Canada.

Again, like a broken record, I will reiterate that we are complying and intend to continue to comply.

12:10 p.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

12:10 p.m.

Assistant General Counsel, Law Branch, Air Canada

Louise-Hélène Sénécal

We made an undertaking, Mr. Chair, to look at the agreement and determine whether there is a clause--as you had asked--with regard to some maintenance, or that would prevent them from providing or doing the maintenance somewhere else. We will determine if the clause is confidential. If it is confidential, we will check to see if Aveos consents to the disclosure, and we will disclose if they have no objection.

12:10 p.m.

Conservative

The Chair Conservative Merv Tweed

Thank you.

Monsieur Guimond.

12:10 p.m.

Bloc

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

Thank you, Mr. Chair.

If I am taking this attitude when asking my questions, it is because there are some unknowns. The Air Canada officials have stated that—although I am persuaded otherwise—they no longer have any overhaul centres, that they sold them to Aveos. And yet, there is no guarantee that Aveos will meet the principle of public participation; we will not let ourselves be fooled, since the act targets Air Canada. Aveos is a private company, a third party that is not required to comply with the Air Canada Public Participation Act. Our concern is that the maintenance work will be offshored to other countries.

I am referring to El Salvador. There are also rumours circulating about Costa Rica. I am not being racist toward those countries that also carry out maintenance. However, we are assured that the people working at the three overhaul centres in Canada are specialists, professionals. We expect that Transport Canada officials enforce the regulations. In the aviation sector, there is much that is subjective, and much that is built on trust. If I had the opportunity to go to Peru and had to choose between Air Canada and Aeromexico, I would choose Air Canada because of its good reputation.

But small accidents might have an impact on a company's reputation. Take the example of the crash of a Regional Jet that missed the runway and then ploughed to a stop during a storm in Fredericton, a few years ago. The first thing that Air Canada did was to send people with five gallons of paint to paint over the Air Canada logo. You knew that those pictures would be broadcast around the world. You did not want that to tarnish your reputation. You are opening yourselves up to such things and should assume the consequences.

I would like to come back to the testimony given by Mr. Mazankowski, the former Conservative Minister of Transport. During his appearance in 1988, he said the following:

There are other significant points that, in my view, are key elements of the legislation. First of all, the bill states that the head office of Air Canada will remain in Montreal. Furthermore, it guarantees that Winnipeg, Montreal and Mississauga will maintain their operational and overhaul centres. Those provisions reflect decisions made by the corporation [...]

We are also talking about the application of the Official Languages Act. When I sat on the Standing Committee on Transport, some 10 years ago, we dealt with the demise of Canadian Airlines, a company that merged with Air Canada. My party and myself, as the transport critic, were on the side of Air Canada, not Canadian Airlines, a company that was controlled by American Airlines, whose head office was in Dallas. I wanted the jobs to remain in Quebec and Canada.

Conservative minister Don Mazankowski made the commitment regarding the head office, overhaul centres and the Official Languages Act. He limited ownership of Air Canada shares by foreigners to 10%. You, Conservatives, gave us those guarantees. If you again want to reverse the situation, you can, but you will have to live with the consequences in the cities of Montreal, Mississauga and Winnipeg.

Was Minister Mazankowski simply going through the motions? Did he try to mislead us when he said that in 1988?

12:15 p.m.

Assistant General Counsel, Law Branch, Air Canada

Louise-Hélène Sénécal

What did he say exactly?

12:15 p.m.

Bloc

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

I will repeat it for you. He was testifying about the bill. He appeared before a committee in 1988 to discuss Bill C-129. Ask your lobbyists to read his evidence of June 14, 1988, on page 25 of Hansard. He said:

There are other significant points that, in my view [...]. First of all, the bill states that the head office of Air Canada will remain in Montreal.

That is something you respect. He continued by saying:

Furthermore, the bill guarantees [...]

That is the word he used. Here is what he said:

Also guaranteed are the operational and overall centres in Winnipeg, Montreal and Mississauga.

When he gave that guarantee, was it not supposed to mean something?

12:15 p.m.

Assistant General Counsel, Law Branch, Air Canada

Louise-Hélène Sénécal

It depends on the issue. We have to look at what came out of that, i.e., the legislation that is before us. We are compliant with that legislation.

12:15 p.m.

Conservative

The Chair Conservative Merv Tweed

Thank you, Mr. Guimond.

Mr. Bevington.

12:15 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

Thanks, Mr. Chair.

I want to say I am encouraged by certain things you've said today vis-à-vis the rest of the aviation industry. I appreciate your approach on safety and maintaining high standards.

I'm actually a little shocked about WestJet. You insinuated that they look for the lowest possible cost from—

12:15 p.m.

Director, Government Relations, Air Canada

Joseph Galimberti

No, they have the ability—I wouldn't want to make any insinuation. All of their stuff is Transport Canada certified. They're very, very safe. I would not want to leave that impression.

12:15 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

Okay.

Now when it comes to aviation overhauls of planes, probably one of the larger costs are engines. In many cases the engine would be taken out of the plane and another one would be installed, and then that engine would go for an overhaul.

Is that not the procedure that would be followed?

12:15 p.m.

Senior Director, Engines and Airframe Maintenance, Air Canada

Michel Bissonnette

That is correct.

12:15 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

So is it not correct that once that engine is out of the plane it can be moved anywhere? You can put it on a train or a truck or on another airplane and send it to El Salvador. Is that not correct?

12:20 p.m.

Senior Director, Engines and Airframe Maintenance, Air Canada

Michel Bissonnette

We don't send engines to El Salvador.

12:20 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

You've taken a lot of Brazilian jets. Would the maintenance and the overhaul of the Brazilian jets not be more cost advantageous to you in other parts of the world?

12:20 p.m.

Senior Director, Engines and Airframe Maintenance, Air Canada

Michel Bissonnette

Are you talking about the aircraft or the engine, sir?

12:20 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

The whole package: engines--

12:20 p.m.

Senior Director, Engines and Airframe Maintenance, Air Canada

Michel Bissonnette

I can answer for both. The aircraft are overhauled in Winnipeg and the engines are overhauled in Montreal.

12:20 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

So in the future those would not be subject to your looking at other locations for potential lower costs.

These planes are used all over the world, so there are probably lots of mechanics in lots of locations who meet certain standards. Is that—

12:20 p.m.

Senior Director, Engines and Airframe Maintenance, Air Canada

Michel Bissonnette

I don't understand. There are many questions in your question.

12:20 p.m.

NDP

Dennis Bevington NDP Western Arctic, NT

Are there certain standards that are met around the world that would lead you to be looking at engine overhauls in other locations?

12:20 p.m.

Senior Director, Engines and Airframe Maintenance, Air Canada

Michel Bissonnette

We are not looking at CF34-8 or CF34-10 engines to be overhauled in other locations. That is the engine that is installed on the Embraer regional jet.

Transport Canada does hold Air Canada responsible to have qualified service providers so that those engines would be overhauled to a standard we maintain at Air Canada.