Thank you very much, Mr. Chair and committee members, for inviting us to appear today.
You've already introduced my colleagues. I would just note that Marc Fortin, who is our director general for the Atlantic region, until three weeks ago was our director general of transportation technology and innovation. He's wearing two hats today.
I will also note Jutta Paczulla and Marc Prévost, who are also very active on the innovation front.
I was very pleased to learn that this committee is seeking to study the issue of innovative transportation technologies. This issue warrants a substantive dialogue—one that takes a long-term view of the challenges and opportunities.
In this period of fiscal restraint, we need to, more than ever, focus on achieving efficiencies—for example, how can we “get even wiser” and do more with existing transportation infrastructure and equipment. Applying innovative transportation technologies is part of the solution.
We have prepared a deck that you may find helpful as additional background and context for your further study. We will leave copies with the clerk.
I would like to focus today on the economic and policy context of transportation innovation and share with you Transport Canada's work to promote innovation as part of a competitiveness agenda for Canada's transportation sector.
Let me start with the economic context. At Transport Canada we've been asking ourselves if the transportation sector is well positioned to face new challenges, such as the emergence of integrated supply chains, the rise of the BRIC economies, shifts in demographic composition, increased concerns around safety and security, environmental impacts as a result of economic growth or climate change, energy price volatility, and the current global financial environment.
Canada's future prosperity depends on how effectively we're able to respond to these global pressures. That's why having a modern and competitive transportation system, one that meets the challenges posed but that also takes advantage of opportunities offered by these pressures, is vital.
Innovative approaches are not new to the sector, and we'd like to highlight today one area where Transport Canada has been putting a lot of emphasis over the last decade, which is in promoting intelligent transportation systems, commonly known as ITS.
ITS involves the application of “smart” technologies, such as communications, sensors, computing, and management strategies. When applied to transportation, these technologies offer the opportunity to improve operational efficiency, safety, security and environmental responsibility.
Through federal as well as provincial and municipal programs, the basic foundations of ITS have been implemented across Canada. Most major cities today have traffic management systems and traveller information systems.
There are also a number of cutting-edge ITS applications in use in Canada. ITS is used to track and monitor commercial fleets and driver credentials to enhance the secure and efficient movement of intermodal freight and supply chains, to expedite clearance of cargo at border crossings, and for vessel navigation on the St. Lawrence Seaway.
ITS is used to automatically weigh and classify commercial vehicles at highway speeds along their routes, reducing trip times and the need for long-haul trucks to repeatedly stop at highway inspection stations, and ITS is used today to monitor and report actual road weather conditions to help improve winter driving safety and support winter road maintenance operations. These technologies can even monitor and control the amount of road salt applied on highways.
But innovative solutions can take many different forms. Some examples are: innovative governance, notably the privatization and commercialization of transportation infrastructure and services; innovative financing, such as through public-private partnerships; innovative regulations, including management or performance-based regulations that have enabled more proactive risk and inspection techniques for increased safety and security; and innovative partnerships such as the Asia-Pacific Gateway and Corridor that brings together all of the key transportation, labour and logistics providers across our supply chains to help improve performance.
Another example is Transport Canada’s collaboration with the major railways (CN, CP and VIA) through the Rail Research Advisory Board.
This initiative is a direct response to recommendations from the Railway Safety Act review to strengthen both government and industry contributions to technological advancement in rail safety. This work has not only improved joint planning and maximized resources, but has also leveraged the expertise of new partners, including the National Research Council and Canadian universities.
In fact, one of this initiative's objectives is to encourage the development of the next generation of university graduates and researchers and, hopefully attract them to careers in the transportation sector.
Notwithstanding past success and ongoing industry efforts towards continuous improvement, a stronger public and private sector focus is needed on the role innovation will play in getting us to the transportation system of tomorrow.
In the past, productivity in Canada's transportation sector has often outpaced economy-wide gains. However, this positive gap has been declining in recent years, with productivity gains in the sector having either reached a plateau or decreased. At the same time, competitive pressures are mounting. This raises a number of questions: can the Canadian industry do more? Are the various transportation modes keeping pace? If not, what more can be done to encourage a new generation of best and better practices?
Over the course of the last year, Transport Canada has engaged in a series of consultations with shippers, transport operators, industry associations, universities and research institutions, and other levels of government. Our purpose was to identify the barriers to innovation and to determine what our role should be to foster sector innovation.
Our discussions have clearly pointed to the fact that both the degree and the nature of the barriers to innovation are frequently mode-specific and can vary by firm type. However, the findings of this work also highlighted a number of cross-cutting or horizontal themes: there are few formal opportunities for industry and academia to engage; the sector frequently faces difficulty in qualifying for and accessing broader research and technology programs, such as economic development programs at the federal and provincial levels; the sector's focus is often on short-term return on investments, and this focus can be a barrier to R and D and technology deployment.
I would just note that this shouldn't be surprising, because we're talking about a sector in which the modes are incredibly capital intensive. They're focused on investing in the immediate requirements to keep the industry moving, but this tends to have a negative impact on R and D for the future.
A final cross-cutting theme has to do with regulation. A lack of regulatory certainty and the fact that regulations can lag behind business practices and not always keep pace with new technologies can negatively influence private sector innovation.
Through this work Transport Canada has also identified its role as one of knowledge broker and facilitator in terms of both helping to address barriers and to identify opportunities. To this end we've identified four areas where we could strategically focus our efforts in future.
The first is encouraging greater uptake of advanced technologies that enable our operators to integrate and optimize the transportation system. This includes focusing on the efficiency and security of supply chains in border crossings as well as looking at ways to use technology to address congestion problems at ports. It also includes developing a policy vision for the next generation of ITS technologies, particularly as they relate to wireless communications and connectivity.
The second is to target modest research and knowledge investments in strategic areas that address unique Canadian requirements or challenges. Examples include research on what we call cold climate transportation, adaptation to climate change impacts, and longer-term research in support of Transport Canada's safety and security objectives.
The third area is promoting information flows and a deeper sector-specific understanding of innovation performance through data, analysis, and measurement.
Last is to ensure that our policies and regulations do not pose barriers to innovation and thus meet the future needs of the transportation system and its users.
In conclusion, innovation and the application of new technologies are key to improving transportation competitiveness, driving the next generation of sector productivity gains, and addressing system challenges. A study on the part of the committee would greatly contribute to the department's and the sector's work to promote innovation in helping to build a transportation system that meets Canada's 21st century needs.
Thank you for your attention.
We are open to your questions.