Transport Committee on Nov. 29th, 2012

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

I'm going to give the time to Mr. Toet.

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

Thank you, Mr. Chair, and thank you to all of our officials who are here with us today, because this is important.

I want to pick up a little bit on Mr. Coderre's questioning in regard to air safety. Could you tell us about the goals and intentions of our SMS, safety management system, and expand on the benefits of that?

[Gerard McDonald]

Essentially, the intent of a safety management system is to ensure that the carriers that are operating in our civil aviation environment have a system in place to regularly assess that they are following the required regulations we have in the civil aviation regime. Many people incorrectly try to say that this is self-regulation. It is anything but. Safety management systems are another layer on top of the regulatory regime to ensure that companies pay attention to safety on a day-to-day basis, as opposed to trying to pass inspections once a year when we come in and look at how their operations work.

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

Can you just give us an example of how this has affected this culture of safety? You talked about it a little bit, that it's day to day rather than periodic. Can you give us an example of how that works?

[Gerard McDonald]

I used a very plain example before, and I'll use it again.

We'll take a taxi company, for instance; we don't regulate taxis, but it's a good example. We might have a regulation that says your brake pads have to be five millimetres. So we come in once a year as the regulator and we take off the tire and we look at that tire to see whether or not the brake pad was less than five millimetres. If it were less, then we might slap a fine on you or something like that. All that tells us is that at that particular time, that one time of year, the brake pad was the required thickness.

With the safety management system, we would say that you have to have a system in place to ensure that the width of your brake pads is being continually looked at and to ensure that the person looking at them has the required qualifications to do so, and you have to document that. So we would go in then and take a look at the system they have in place to ensure, on a daily basis, that they are indeed meeting the requirements of the regulation.

Obviously, when we're talking about civil aviation, it's much more complex than that, but in the short time I have available, I think that's a quick explanation of how it works.

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

That's very helpful, because it does give us a sense that the ongoing safety aspects are being monitored on a regular basis and not just at points in time. For an air traveller such as I am, it's much more comforting to realize that whatever I'm on has been inspected on a regular basis and not just checked out maybe nine months before the last time I flew.

Regarding the program, I understand that Canada is seen as a world leader in implementing SMS. I'm wondering if you can talk to us a little about how this has been implemented, how this model has been brought forward, some of the processes that have gone on, and what kind of support we are having from stakeholders on this type of process.

[Gerard McDonald]

I should note that stakeholders are very supportive of the use of safety management systems. It's a way for them to systematically manage their safety environments, and it's something they take very seriously as well.

Canada has been a leader in the introduction of safety management systems. We were one of the first countries to do so internationally, and right now all our carriers carrying 20 passengers and more are required to have safety management systems as part of their regime.

We are currently investigating whether or not to extend that requirement to those carriers carrying between 10 and 20 and then 10 and fewer. One of the issues we have to deal with is whether or not the industry has the capacity to do that at that level. Obviously, a small airline operation doesn't have the same capacity as Air Canada to implement a system such as that. So we have to ensure that the system is scalable enough to allow for it to be implemented.

That being said, many of the smaller carriers have implemented safety management systems on their own, just because they see it as a good management practice.

This is not endemic to the airline industry; indeed, we have safety management systems in the marine industry and in many industries other than transportation. In fact, safety management systems came about in the chemical industry as a result of the Bhopal disaster in India.

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

Thank you.

[The Chair, Conservative, Larry Miller]

Mr. Holder, it's your turn.

[Ed Holder, Conservative, London West, ON]

Very quickly, I had the opportunity to briefly mention to the minister the importance of Windsor-Detroit as those 8,000 trucks pass by London every day.

The cost of the bridge is a concern of some of my constituents. Through you, Mr. Lévesque, to your staff perhaps, can you explain, so that I can explain to my constituents, what the gross cost is estimated to be and how we intend to recoup that cost? And is there a timeframe in which you'd imagine that would happen?

[Louis Lévesque]

[Inaudible--Editor]...level, as the minister has indicated, we're looking to a P3 and tolling system to recover costs.

I'll turn to Helena to talk to you more about that.

[Helena Borges, Assistant Deputy Minister, Programs, Department of Transport]

The total cost of the bridge component is roughly about a billion dollars. On either side, of course, we have to have customs plazas, both on the Canadian side and on the American side, and then on the Michigan side there is an interchange that connects to the interstate system.

Those pieces will comprise the DRIC crossing, the Detroit River international crossing project. As for the total of cost of that, right now we are doing the figures again because the work on the Michigan side was really delayed for a two-year period. We're bringing those numbers up to date, and we estimate that the cost will be a little bit above $2 billion.

As the deputy said, the objective is that we will go for a public-private partnership. We have done various rounds of soundings with the market, so the players, the P3 players, and they've indicated to us that they have an interest in the project, a big interest. I think the governor saw that in Toronto earlier this week at the P3 conference. We expect that they will be able to invest equity in the project, and that they probably would be able to invest enough to cover the costs of the bridge.

With that, the government would then have to look at how to cover the rest of the funding through appropriation. Tolls will be charged and tolls will be set according to the market rate at that time. We expect from the traffic analysis we've done—perhaps three times over now, and we'll update them again before we go out to market—that the project cost can be totally recouped within a concession period ranging about 35 to about 40, 45 years, and that it would be totally covered from the toll revenue. After that point, all the toll revenues are then gathered and put back into the infrastructure to make sure it's kept in good condition.

So there will have to be upfront support for the project, but the toll revenues will start to pay back very soon thereafter. The project, in fact most projects, will take about a five-year period right at the beginning for the traffic levels to basically firm up. At that point, the tolls start covering the actual investment in the project.

[The Chair, Conservative, Larry Miller]

Thank you.

Mr. Watson, seven minutes.

[Jeff Watson, Conservative, Essex, ON]

Thank you, Mr. Chair, and thank you to our officials for appearing.

Greetings to our new deputy minister. We look forward to ongoing work with you.

I want to direct my questions towards the Navigation Protection Act, an act originally brought in, if I understand it, in 1882. Do I have the year right on that one?

This committee has looked at that issue previously. In 2008 we conducted a number of hearings for several weeks as the build Canada plan was being rolled out. We were looking for some efficiencies to the existing Navigable Waters Protection Act. We settled on, for example, amendments to exempt minor works from consideration. There were a few other things.

But witnesses at the time—we had representatives not only from municipalities but of seven provinces and two territories—were looking for a complete overhaul of the act. It wasn't possible at the time with building Canada plan being rolled out. Now we're at the phase where, as we're looking to the next set of infrastructure programs, it is the right time to restore this act to its original intention, which was to deal with navigation.

We faced two questions at the time: do we try to define what a waterway is, or do we simply move to a listing of waterways or the exclusion of other waterways?

Can you describe for us the decision to move to listing versus trying to define a waterway? What are the problems? We had difficulty as a committee trying to define what a waterway was, as did our witnesses. Can you explain that decision as briefly as possible for us?

[Louis Lévesque]

The first comment I would make is that the proposed legislation provides for both a list of major waterways and an opt-in process if in some areas there's a feeling that there's a need for more protection. So that to some extent combines the best of both approaches.

I will defer to Gerard for more detailed comments.

[Gerard McDonald]

I think we faced the same conundrum that the committee did. We knew we wanted to change the scope of the act, and the question was what was the best way to do it? Trying to come up with a definition to limit the scope of the act proved very difficult.

In the end, we thought the best way was to establish criteria, to identify those bodies of water where commercial navigation was indeed a high priority, and to try to come up with a list of appropriate waterways to which the act could apply. Then, as the deputy minister pointed out, should we find out that we've omitted something or a water has been missed for whatever reason, give us the ability to add them in if so required.

[Jeff Watson, Conservative, Essex, ON]

Our provincial-territorial witness at the committee had suggested that it was their understanding, at both the provincial and the municipal level, that the act from its inception was to deal exclusively with navigation.

In that vein—and I don't expect you to have the numbers here, but I'd appreciate it if they could be compiled for the committee—how many environmental assessments were triggered in the first 100 years by the Navigable Waters Protection Act? How many permits for navigable waters were issued in the same amount of time?

I'll leave that for you to report back on to the committee.

The deputy minister explained that there is an opt-in system. For those who are interested in it, can you explain how the opt-in system will work?

[Gerard McDonald]

I guess there are two aspects to opting in. One is bringing another water into the act, and that would be at the request of a province if they thought a particular waterway was to be in the act. They would make a request to the minister, the minister would consider it, and then there would be a Governor in Council approval to change the schedule of the act.

The other one is for a specific work. If a constructor of a specific work for reasons of greater certainty wanted to ensure they had an approval under the Navigation Protection Act, they could come to us and ask us to review their plans. Then we could do so and issue an approval, and it would have the coverage of the act.

[Jeff Watson, Conservative, Essex, ON]

The current Bill C-45 obviously is not yet enforced. We hope it will be passed in due course and that the changes will be made to it. But under the current execution of the Navigable Waters Protection Act, if I were a forestry company in a remote area doing some logging, and I had to construct, let's say, 100 different temporary bridges over a winding intermittent stream that is clearly not navigated, would I have to make separate application for each temporary bridge, and would each have to be assessed by Transport officials prior to a decision to grant a permit being made under the Navigable Waters Protection Act?

[Gerard McDonald]

That's correct. Each work would require a permit.

[Jeff Watson, Conservative, Essex, ON]

So moving to a system whereby we are having that kind of scrutiny on waterways that are heavily navigated, as opposed to that, will mean a tremendous savings in resources, will it not? It will simplify, too, and give a greater degree of certainty to the proponents who are looking to move ahead with their projects as well.

[Gerard McDonald]

Yes. Certainly for many of those works while the majority of constructors try to live within the law, we strongly suspect there are many who go out and construct these works without living within the actual law as it now exists.

That being said, the changing of the act will allow us to redirect our resources to those areas where navigation is most important.

[The Chair, Conservative, Larry Miller]

Mr. Sullivan, you have the last five minutes.

I want to remind members that we do have a motion to deal with the estimates at the end, which should just take a couple of minutes.

Mr. Sullivan.

[Mike Sullivan, NDP, York South—Weston, ON]

Very quickly, I'm not sure who to put this to in terms of civil aviation safety. There are two airlines in Canada that are using temporary foreign workers to pilot their aircraft in order to pay much lower wages. In the cases where those temporary foreign workers can't pass Canadian certification, they are wet-leasing planes with those temporary foreign workers so they don't need to pass Canadian certification to fly the plane into Canada.

Is the department aware of this, and what are you doing about it?

[Louis Lévesque]

Gerard.