Thank you, Mr. Chairman.
We'd like to thank the committee for the opportunity to appear before you and to present our views on the Aveos closure.
The International Association of Machinists and Aerospace Workers is the largest union in the Canadian air transport sector, having represented Canadian airline workers for over 70 years. We represent 2,600 Aveos workers, most of whom were transferred from Air Canada. We also represent around 2,300 members who continue to perform aircraft line maintenance at Air Canada.
The recent announcement of Aveos's closure and the loss of over 2,600 direct jobs across Canada is shocking, but it does not come as a surprise. It is the result of a series of government policies and Air Canada actions that have undermined the Canadian aircraft maintenance industry.
Aircraft maintenance is a growing global industry, providing highly skilled employment and a major component of Canada's skills and technology base. Aveos, the former heavy maintenance division of Air Canada, is a major repository of the skills and know-how on which this sector depends.
The Aveos closure is more than the loss of over 2,600 high-skilled jobs, thousands of spinoff jobs, and many millions of dollars of lost income and tax revenue. It has serious effects on the cities of Montreal, Winnipeg, and Vancouver in these difficult economic times. The Aveos closure deals a body blow to this economically important sector.
When the federal government privatized Air Canada in 1988, we raised serious concerns about the potential for a privatized Air Canada to move much of its work and jobs out of Canada. The government responded by including in the Air Canada Public Participation Act “provisions requiring the Corporation to maintain operational and overhaul centres in the City of Winnipeg, the Montreal Urban Community and the City of Mississauga”.
The merger of Air Canada and Canadian Airlines has since added Vancouver as a major Air Canada maintenance centre.
In 1988 both the government and Air Canada stated publicly that the Air Canada Public Participation Act guaranteed that employment performing aircraft overhaul would be maintained, and indeed expanded, in these communities.
Frankly, these provisions did not allay our concerns. We feared that a privately owned Air Canada's drive for short-term gain would undermine this commitment. Our fears have now been realized.
From the time that Air Canada exited from creditor protection in 2004, Air Canada management proceeded systematically to dismantle the corporation, selling off assets and sucking over $2 billion out of the company, rewarding themselves handsomely while financially weakening the airline.
As part of this asset-stripping exercise, a majority share in the heavy maintenance division, Aveos, was sold for over $700 million in 2007. At that time, Air Canada committed contractually to provide Aveos with continuing work maintaining Air Canada's aircraft.
Subsequently, close to half of Air Canada's maintenance workforce was forced to transfer to Aveos on the promise of continued long-term employment, based on long-term Air Canada contracts.
Air Canada has not followed through on its commitment to provide the work to sustain Aveos, leading Aveos to file for creditor protection and announce its closure.
Air Canada has not provided us with the information as to where it plans to have the heavy maintenance work done. The speculation is that it may not be done in Canada.
While all of this has been unfolding, the federal government has stood by, making no effort to save this company and this sector. Even as Aveos announced its demise, the government has refused to act. While the government showed no hesitation to step in to quash our members' collective bargaining rights at Air Canada on the grounds of economic necessity, it is unwilling to take any steps to maintain thousands of jobs and a vibrant sector.
We are prepared to take legal action to get Air Canada to live up to the requirements of the 1988 legislation, but we are not here to talk about a legal issue. This is an economic and a moral issue for us. Is the government prepared to stand by and watch the demise of a major player in a key sector of our economy? That's the question.
We call upon the Harper government to respect its commitment under the law to support these jobs and the aviation maintenance industry in Canada.
Now we'll be open for questions.