Transport Committee on March 27th, 2012

[Denis Coderre, Liberal, Bourassa, QC]

Are you prepared to come back then, Mr. Minister?

[The Chair, Conservative, Merv Tweed]

I have Monsieur Toet, please.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

Thank you, Mr. Chair.

Thank you to the minister.

Minister Fletcher, it's nice to have you also back with us again. It's great to see you here.

I know that today you've come to talk about the main estimates, and I do hope we can get back to those eventually. They are very important for us to be talking about. However, I want to take a bit of an opportunity here to speak about the Aveos situation.

I've been following the situation very closely. I am a member from Winnipeg, so this has an effect, obviously, on my community and on members of my community who have seen losses of jobs. It's been very much followed, very closely, in Winnipeg by the people there and by me. We do have some concerns with the Aveos situation, not only in Winnipeg but across Canada. It is a very important situation that we need to talk about.

The aerospace industry is important to not only Winnipeg and Manitoba but also to Canada. The maintenance of our aircraft is a highly important issue for all Canadians, for our safety. We're also talking about jobs that are very good-paying jobs. These are very technical jobs, and these are knowledgeable people who we want to continue to hold in Canada. We want to make sure they can continue to do this work in Canada.

In a situation such as this, one would assume that you are garnering legal advice as we go forward. You've indicated as much, that you are getting legal advice regarding the Air Canada Public Participation Act and the application of that. You have also stated that you're happy to table this with us.

I'm wondering if you could give us an indication as to the advice you've received to date and when we could expect to see this tabled, going forward, just to help this committee do the work that we need to do also in regard to Aveos. That would be greatly appreciated.

[Denis Lebel, Conservative, Roberval—Lac-Saint-Jean, QC]

We expect to table that at your next meeting, on Thursday. For the moment, we're in the final writing of all that. The advice we've received now, following the judgment in Ontario, is that it's not really clear. It's a complex issue. I will wait for the final advice that I will receive before I give this on Thursday.

For the moment, the advice we have received, and the judgment in the Superior Court of Ontario, is that Air Canada respects the obligations they have, but we will wait until Thursday to have the final word on that.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

With regard to the act, at this point, as you say, you have to work through that before you can completely share that information with us on Thursday. We look forward to receiving that, because it will be very helpful to us also.

I'm just wondering if there's any indication in the material we've received in terms of Aveos's versus Air Canada's obligation under this act. My understanding is that this is an Air Canada obligation, not an Aveos obligation. I'm wondering if you can just expound on that a little bit for us and explain that situation as you see it today.

[Denis Lebel, Conservative, Roberval—Lac-Saint-Jean, QC]

You're right. The obligations of the act are on Air Canada, not on Aveos, and that's a business deal between two companies, two private companies. Yes, I hear it's former employees of Air Canada, but now legally they're two different companies. The unions have two different sets of regulations to work with. They're really different. Air Canada is under the law, and we will work to be sure that Air Canada respects this law. That's a formal arrangement we have.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

So going forward, we can expect to be working closely with Air Canada. We want to see this situation dealt with in a way that sees these maintenance standards upheld in accordance with the act.

[Denis Lebel, Conservative, Roberval—Lac-Saint-Jean, QC]

That's why we wanted to have Air Canada here in public, for you to ask them questions. I can meet them ten times in my office in private. That doesn't give you the chance to ask them questions about what they have done and what has been said this morning about Air Canada's obligations. You should have the chance to ask them any questions you want. We hope to have Aveos here too and the union, sharing with you what they have to say.

In the end, we will respect the law, just as Air Canada is obliged to respect the law.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

To go a little further on the obligations of both Aveos and Air Canada, have there been discussions with Air Canada encouraging them to continue to work with Aveos, or are discussions with Air Canada geared toward their obligation to make sure that these maintenance jobs are filled in Winnipeg and Mississauga and Montreal?

[Denis Lebel, Conservative, Roberval—Lac-Saint-Jean, QC]

That's not the choice of Air Canada.

It's the choice of the owners of Aveos to seek the protection of the Companies' Creditors Arrangement Act; it's not the choice of Air Canada. The private owners of Aveos decided to seek the protection of the act, in Quebec. The next day, Air Canada offered them temporary support of $15 million so they could continue their operations, but the owners of Aveos refused the offer of assistance and, instead, preferred to announce that the company was dismantling.

Obviously, we don't think this is an ideal solution. But it was a business decision by the owners of Aveos. The discussions between Air Canada and Aveos relate to the private agreement between the two companies. This matter does not involve the government. As with all the other private sectors where there are business obligations, it is up to the two owners to do business together. In the case of Aveos, it was a business decision made by the owners of the company.

I understand very well that, since 1988, there has been a lot of water under the bridge, but the facts are still there. Aveos has a completely separate collective agreement for its workers, and it must be respected. Even after the discussions I had as minister with the owners of Aveos, they decided to seek the protection of the Companies' Creditors Arrangement Act. I cannot manage the company for them.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Watson.

[Jeff Watson, Conservative, Essex, ON]

Thank you, Mr. Chair.

Minister and officials, thank you so much for being here.

I didn't expect to comment on Aveos, but since we're there, I think two things have emerged. First, this issue has nothing to do with declining safety in Canada. We have one of the safest air transportation systems in the world, and if Aveos is no longer in business, there are others who can ably perform maintenance and repair under the stringent regulatory framework of Transport Canada.

Second, I would say that the Aveos situation has everything to do with Air Canada's obligations under the law. Air Canada is the one that is going to have to find a way to comply if Aveos is no longer in their supply chain, and I think it's incumbent upon this committee to take up your challenge to hold hearings. I think Air Canada has to come and explain their plan to comply with the existing legislation.

With regard to the estimates, since this is important work here and we have some important expenditures to review, I want to talk about the DRIC, the Detroit River International Crossing. I notice that there are substantial expenditures related to the gateways and border crossings fund for the upcoming fiscal year. There is some additional spending planned for land acquisition related to the corridor. I'd like you to give the committee a general update on the status of the DRIC project.

[Denis Lebel, Conservative, Roberval—Lac-Saint-Jean, QC]

As I've said before, we remain fully committed to building the new publicly owned crossing between Windsor and Detroit. Michigan Governor Rick Snyder has confirmed that this project remains a top priority for his administration.

We will continue to work with the governments of Michigan and the United States to examine options for delivering the new crossing. I met my counterpart, Secretary Lahood, and Secretary Napolitano, who confirmed that this was important for them too, and they are still involved.

The bridge proposal has received the necessary environmental clearance on both sides of the border. We have offered $550 million for Michigan's project components and this remains on the table. We will continue to work to create all the facilities to go forward. We will continue working with the Michigan and United States governments on options to delivering the new crossing, and that's a real involvement.

[Jeff Watson, Conservative, Essex, ON]

Obviously, with respect to the internal situation in Michigan, the governor is balancing a lot of key priorities at the moment. Detroit's situation with respect to possible emergency management is obviously consuming a considerable amount of his time in the short term.

The remaining piece to completing this is the creation of a P3 entity with respect to the State of Michigan. This is a new concept for the State of Michigan. Obviously we in Canada have a lot of experience with respect to P3. As I understand it, that is a last remaining piece.

Can you verify if that's the next hurdle, at some point, for the State of Michigan to look at, as it gets beyond the urgent financial issues with respect to Detroit?

[Denis Lebel, Conservative, Roberval—Lac-Saint-Jean, QC]

We were very pleased with the advances we had at the last meeting. The progress that our provincial partners have made with the construction of the parkway is also important to us. Our American partners are very involved. We know the challenges that they have in Michigan at the moment. Governor Snyder is still very involved, and we're finding solutions. That's not an easy issue. We're working with two countries, as you know, but are on the way. We made good advances at the last stage.

As I stated, in budget 2011 our government committed to fund up to 50% of eligible capital costs of the parkway, up to $1 billion, and we will continue in that way. Things are going well for the moment. We still have work to do, we know.

[Jeff Watson, Conservative, Essex, ON]

It's actually transforming the landscape of the Windsor-Essex parkway. I've been up and down that corridor quite a bit over the last little while.

With respect to the federal aspects, the land for it, the plaza, and the launch point for the bridge, there has been some activity in the past on that. I noticed additional expenditures coming up on that. Can you or your officials give us an update on where we are at on land acquisition for the federal-only components?

[Yaprak Baltacioglu]

Mr. Chairman, we are staying behind after the first hour and our assistant deputy minister, Helena Borges, who has the details about the land acquisition, will be able to give more detail.

That being said, as you can see in the estimates, money has been brought forward and we are keeping money for the plaza. Of course some of this is still pretty preliminary. Once the project is going fully ahead, we'll make sure that the funding is provided for that.

[Jeff Watson, Conservative, Essex, ON]

Beyond the border crossing being a very important agreement with the United States to improve travel flows, I just want to put on the radar screen that we would be an ideal location, with respect to pre-clearance for cargo. There are projects coming up the way, but I think that should be on the radar screen for the government.

On the issue of provincial-based funding, officials were here before the committee. I understand that Ontario had a larger share that was as of yet unclaimed. Is there an update on provincial-based funding? Maybe this is for your officials to answer, Minister. How much is left? What's happening?

[Yaprak Baltacioglu]

There's money left in the provincial-territorial base for Ontario, but I can't give you any more of an update than that the money is there.

[Jeff Watson, Conservative, Essex, ON]

How much more time is there?

[The Chair, Conservative, Merv Tweed]

You have 30 seconds.

[Jeff Watson, Conservative, Essex, ON]

I have 30 seconds. I'll defer that, then. I have no more questions.

[The Chair, Conservative, Merv Tweed]

Thank you.

Monsieur Coderre, on a point of order.

[Denis Coderre, Liberal, Bourassa, QC]

Mr. Chair, the minister really wants meetings to be held. I, personally, tabled a motion that is in order on March 19 with respect to Aveos Fleet Performance Inc. As for the performance of managers, we'll go over it again. The motion reads as follows:

That following the March 19, 2012 closure of Aveos Fleet Performance Inc. the Committee invite the Minister of Transport, his officials, representatives from the International Association of Machinists and Aerospace Workers…

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Chair, this is not a point of order.