Transport Committee on Oct. 17th, 2011

[The Chair, Conservative, Merv Tweed]

Welcome back to the Standing Committee on Transport, Infrastructure and Communities, part two. Joining us today from the Canadian Union of Public Employees is Mr. Paul Moist, national president and fellow Manitoban. I know he has another guest at the table.

I'll ask you to introduce your guest and then proceed.

[Paul Moist, National President, Canadian Union of Public Employees]

Thank you very much, Mr. Chairman.

Members of the committee, with me is Kelti Cameron. Kelti is a senior research officer for the municipal sector. Also with us is Toby Sanger, our senior economist. If there are any questions arising out of what we say, Toby will assist as well.

We're very privileged to be here, and we'll stick to your timeframes.

CUPE represents over 600,000 Canadians who work mainly in public services. They include about 6,000 urban transit workers who work all across the country.

We're pleased to talk today about public transportation as a pretty fundamental element of an equitable society. It's only through a national strategy, in our view, that we could realize the full benefit of that equity. There are necessary investments required for a truly pan-Canadian public transit system.

Interestingly, it's the number one priority for the Toronto Board of Trade. The Canadian Chamber of Commerce has also called for a national strategy. And I read, Mr. Chairman, your encounter last week with the Federation of Canadian Municipalities and the Canadian Urban Transit Association. We also want to place Canada in the context of the developed world, the G-8. Significantly more investment in national transit initiatives is happening in other countries than currently exists in Canada.

We recently polled Canadians through the Canadian Labour Congress. Seventy-three percent would support more federal government support for local transit, 92% feel that public transit makes their community a better place to live, and 66% feel that all three levels of government are not working together to implement long-term transit priorities.

Why do we need more investment? I think it's self-evident. Other delegations have spoken to it, but I'll quickly run through a couple of examples.

First, it would reduce the cost of congestion. Estimates for Toronto alone, from an OECD study, suggest that $3.3 billion in savings could be realized by simply reducing congestion.

There are health costs. In Ontario alone, air pollution carries a price tag of $1 billion.

Traffic collision costs and annual vehicle operating expenditures for households could come down with expanded or improved public transit.

We think there are savings for government in the long haul. We think it could be less expensive than our current system, when the social costs of parking are taken into account. Transit is actually one-third to one-half as expensive as automobile use for moving people around from home to work.

I know that all parliamentarians share the collective goal of reducing greenhouse gas emissions. Private automobiles account for 27% of Canada's greenhouse gas emissions.

With regard to quality of life and equity issues, I put on the record that lower-income people and recent immigrants rely much more on public transit as part of their regular routine of working, moving their children to child care, and so on.

Under the heading of job creation and stimulus, public transit currently employs over 50,000 Canadians, and indirectly another 24,000 Canadians. The job creation potential of major public transit, such as inner-city rail projects, could be between 9,000 and 14,000 jobs for every billion dollars invested. A recent study concluded that investment in public transportation could potentially create 18% more jobs per dollar invested than road construction or road maintenance. There are long-term economic benefits from investment in something the public needs.

Why do we need a national strategy, as opposed to a local strategy? The economic, social, and environmental impacts, costs, and benefits aren't just local; they are national in scope. National funding is needed, not exclusively but as part of the mix to improve public transit. And there are huge equity and access issues for all Canadians. It truly is a pan-Canadian issue.

What would the goals of a national public transit strategy be, beyond those in the draft legislation, Bill C-305?

Number one would be adequate long-term funding. We agree with the Canadian Urban Transit Association's submission.

Number two would be increased access and affordability. Individual Canadians currently pay higher public transit costs than most other G-8 nations. It is 62%, compared to 39% in the United States.

Collaboration among all levels of government is desirable and needed on this pan-Canadian issue, and the added benefits of integrated transportation and land use planning we think should be a principle of a national public strategy. We also propose, at the federal level, research in information sharing. What one community learns from a project can and should be shared as part of a national strategy, and there should be accountability to ensure funding meets these objectives.

Wrapping up very quickly, we think an additional public priority that was not stated or not clearly stated in the proposed legislation is that public transit must be public in financing and public in operation. There is a significant role for the private sector in the capitalization of needed public transit expansion, but there are plenty of examples from around the globe of private financing not being an option, especially now when we're living in historically low-interest-rate borrowing times for the public sector. We've seen some big mistakes where the public sector gets left with the bill—the London Underground and Metronet so-called public-private partnership, for example. The City of Ottawa here just settled a lawsuit—almost $37 million—after a previous light rail P3 project was cancelled. I notice that the current mayor of Toronto has ditched the city transit proposal from the former administration. He says his new subway line is going to be funded with private financing, and he's having a hard time finding that private financing.

So we live in precarious economic times. There has never been a more efficient period of time for the public sector collectively—not just the federal government but all levels of government—to invest in our society through public transit at very economical rates.

Public transit that exists in Canada is a good deal for many Canadians. There's a huge demand for increased public transit, especially in the growing part of Canada, the 20 urban centres that now house over 80% of the population. And that percentage is rising. Ninety percent of the immigrants coming to our country are in those 20 major urban centres. I agree with Brock Carlton, who was here just recently. All of those communities have huge infrastructure needs. Today we're focused on public transit, but we need a shared experience in Canada to make effective progress on the funding of infrastructure—in this case public transit. The entire infrastructure challenge can't be funded through property taxes.

Thank you, Mr. Chair.

[The Chair, Conservative, Merv Tweed]

Thank you very much.

Ms. Morin.

[Isabelle Morin, NDP, Notre-Dame-de-Grâce—Lachine, QC]

Thank you very much.

Thank you for your presentation. I was happy to hear you point out the potential health costs that automobiles represent currently for our citizens. Today the Alliance pour le financement des transports collectifs au Québec, the Federation of Chambers of Commerce of Quebec, and the Association pour la santé publique du Québec met to ask the Government of Quebec to increase funds allocated to public transit, rather than allocate more funds to large infrastructures.

I would like to know how you feel the federal government could work with the public transit networks in Canada to define the roles, the responsibilities and the priorities of each level of government with an eye to a national strategy. What is your opinion on this matter with regard to employers and workers in Canada?

[Paul Moist]

Thank you very much for the question.

First of all, as the Federation of Canadian Municipalities has said, about a quarter of CUPE's membership, about 150,000 to 160,000 members, are municipal employees. For the eight years I have been in this job, I have attended all of the conventions and events held by the Federation of Canadian Municipalities. Mayors and councillors from across Canada cannot meet their infrastructure and public transit needs off the property tax base. Many communities have had responsibilities put onto the property tax base for which it was never intended. They respectfully speak—and the meetings are always respectful—to all political parties. The four major parties, including the Green Party of Canada, are invited every year to the Federation of Canadian Municipalities meeting, and public transit has been a big part of their overall infrastructure submissions. They said here a week ago, in your presence, that the gas tax has been welcomed and it has been embedded by the current government as an ongoing fix of revenue, but there is no escalator clause built into it, and that's needed.

With regard to the space created by the cuts in the GST, it has been said notionally by some federal spokesmen that that's available for junior levels of government. Well, municipalities do not have the authority.... As the chairperson notes--he and I come from the same province--65% of the population in Manitoba lives in one community, Winnipeg. Well, the mayor of Winnipeg wants a 1% increase in the sales tax but he has no authority to make that happen.

Nothing really happens in Canada without the federal, provincial, and, I would argue strongly, the municipal governments having a seat at the table to talk about stabilizing funding. I could live with the Canadian Urban Transit Association's submission that one cent of the two cents the current government has cut off the GST be dedicated to public transit. That is one of the options.

[Isabelle Morin, NDP, Notre-Dame-de-Grâce—Lachine, QC]

Thank you.

What role do you see the unions playing in the determination of this national public transit strategy?

[Paul Moist]

Thank you very much. I didn't answer that the first time you asked it.

We have an incredible responsibility on behalf of the people who work in public transit to make the most efficient system possible, to embrace change if communities are going to move from traditional busing to light rail or other systems. We have pretty sound relationships. We have 3,900 relationships across Canada in the form of collective agreements with towns, municipalities, everything from the cities of Montreal and Toronto to small communities. All of them want to work with us to varying degrees when it comes to making changes to the system. We are quite open to doing that. Some relationships are better than others.

When we lobby federally, we talk about infrastructure funding not from the point of view of CUPE. CUPE members don't do capital works. That's not our point. Our point is that we work with maintaining systems that are falling apart. Canada is a big producer of conventional buses. My own hometown produces some of the best products in the world. We need to align all levels of government, but not to trample on the jurisdiction of provinces or get into a constitutional debate. That's a waste of everybody's time.

The municipalities are preachers of their provinces, legislatively. As somebody who represents workers at the municipal level, fixing rail lines and buses, we are fixing things in some cities that should have been replaced a long time ago. We see changes in government like we've seen in Toronto and we are not sure what the future holds.

Beyond negotiating for wages and benefits for folks, CUPE has a responsibility to be part of the solution and to broaden sources of revenue beyond property taxes. We won't have a national public transit system if the solution lies with property taxes, and there will be a revolt in the country. That is not the solution. There are more progressive ways for us to collaborate. I think the country is screaming for all three levels of government to collaborate on many issues, from health care to the environment, including public transit.

[Isabelle Morin, NDP, Notre-Dame-de-Grâce—Lachine, QC]

You are talking about the potential for job creation. Do you see a difference between a national strategy and a more local one in that respect?

[Paul Moist]

Probably not, but a national strategy could have a more positive impact. We should not use government money to create jobs for the sake of it. But if we're talking about renewing infrastructure, the statistics that I gave you are that over the last ten years, investment in capital works in the municipal sector has created 140,000 person-years of work. That's important--road work, all kinds of waste water treatment plant work.

I gave you statistics that show that if we invested in public transit and inter-city rail projects, we could do much better than investing in simply road and road maintenance. We need to maintain roads and we need road maintenance, but we can't be a society that's imprisoned by our infatuation with the automobile.

When I speak about other G-8 countries, they have not.... Major cities in Europe, where most of you have travelled, and certainly in Hong Kong.... The statistics I heard in Hong Kong were that less than 10% of the population transport themselves in privately owned automobiles. Ninety percent of the population transport themselves through public transit systems.

We're not like them or like European cities; we're much more American. We have become imprisoned with building beltways and roadways. We need those things, but we also need investment in public transit systems that can more efficiently move people to and from work and reduce our greenhouse gas emissions and actually create meaningful employment for thousands of unemployed construction workers. Many of the stimulus measures from the Building Canada fund.... The last delegation was asked a number of questions. Many of those projects are done; they've been committed to. We need a new federal-provincial-municipal boost toward fixing infrastructure, including public transit.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Coderre.

[Denis Coderre, Liberal, Bourassa, QC]

Thank you, Mr. Chairman. First of all I would like to welcome our witnesses.

I always find it a bit hard to listen to the comparison between the reality in Hong-Kong and the situation in Canada when it comes to automobiles. Drivers are not the bad guys in all of this. We have to improve quality of life and reorganize things. There is a governance and a management issue. At the municipal level, the infrastructure is indeed becoming obsolete, and without infrastructure it will be difficult to have public transit. And on the topic of public transit, I liked the fact that in his presentation the CAA representative talked about integrated positioning, that is to say what is being done regarding cyclists. There is also the matter of the train. We should be talking more about the high-speed train in the Windsor-Quebec corridor.

All that said, I want us to talk about motivation for a moment. You, of course, are familiar with the situation of workers, of unionized workers. Before we begin to philosophize on the concept of dedicated funding and everything that relates to that topic, could you tell us about how your members see things right now? What do they say about current public transit networks? Do they feel that the system is obsolete? We may well develop a national strategy, but what will we do if our current equipment is failing? Moreover, people have been talking about jurisdictions. Is it the Canadian government's responsibility to invest in this or should we be looking rather for a new funding approach?

I would like to hear you discuss the situation. People talk to you a great deal. What are you hearing right now from unionized workers with regard to public transit as it exists currently, in urban areas in particular?

[Paul Moist]

Thank you very much.

I expect it depends on where you go, but we've heard a number of messages.

[Denis Coderre, Liberal, Bourassa, QC]

Let's talk about Montreal.

Others are going to talk about the situation in Toronto.

[Paul Moist]

We hear about aging fleets, huge pressure on property taxes, and cutting services to so-called non-productive suburban routes.

No transit driver or maintenance worker wants to see the public waiting an hour and a half for a bus that used to come every 30 minutes. That's just the fiscal pressure on municipalities. That is point number one.

Sometimes we're asked as a national union to take positions on big political decisions. Building the Canada Line from the airport in Richmond to downtown Vancouver was driven by a single event, the 2010 Olympics. It hopscotched ahead of other projects in the lower mainland, and we have two points of view on traffic in the Vancouver and lower mainland areas.

Number one, as workers we are stuck in that traffic every day. Number two, from a transportation point of view the GVRD, the greater Vancouver regional district, the collection of mayors from the lower mainland, had a 30-year plan. It was interrupted by the beautiful success of the Olympics. It was great for the Olympics, and it's great for me when I land in Vancouver and want to go downtown efficiently. It's much cheaper than a taxi. But it wasn't part of the overall plan for the lower mainland.

It may be a pipe dream and impossible in Canada to think of tri-government planning that we stick to, because different priorities pop up from different folks. But our folks who maintain public transit systems tell us we have an aging system and the investments are needed to keep the system going. A maintenance worker in Calgary told me we're throwing good money after bad sometimes, bandaging up something that should be replaced, like a bridge in your community that needs to be replaced.

[Denis Coderre, Liberal, Bourassa, QC]

Basically we need flexibility through a national strategy. It's not a one-size-fits-all situation, and some events happen, like the Olympics, which is great, so we can adapt ourselves.

How would you proceed with what I would call a new deal with different levels of government? Because at the end of the day, the Constitution remains. You cannot get involved in a provincial matter. From a federal perspective you cannot go directly to municipalities, because they are provincial creatures. But at the same time, there is a new reality that in those big cities you have to do something about it. The future of Canada clearly goes on at the rural level, of course. But for the future of cities like Montreal, Vancouver, Toronto, and so on--I can say Winnipeg for the purpose of the reality too--how can you manage that new deal? How do you perceive it? Do we need a new federal-provincial-territorial conference with all the other stakeholders?

We already invest some money through infrastructure. We put some money into public transit, but frankly it's not just putting some money into some events or infrastructure; we need to look ahead. If we want to have a vision for the next 20 years, how concretely could we manage that kind of new deal with the workers, the employers, and the governments?

[Paul Moist]

If I had the answer to that I'd be a rich person. I don't care whether it's health care, social housing, municipal infrastructure, or post-secondary education, on all fronts the best decisions Canadians enjoy are those where there's broad consensus from the federal--notwithstanding jurisdictions--the provincial, and municipal levels.

Think of the success stories in Canada, and think of the non-success stories in Canada. There isn't a politician of any political stripe at any level who doesn't recognize that the number-one policy issue for Canadians is health care. Notwithstanding frustration at times with the health care system, there's an expectation that health care will be available and perhaps improved in the long term.

We have created services that are the envy of some countries in the world, but we're rapidly running up against problems in the area of social housing. The budget of 1995 saw--

[Denis Coderre, Liberal, Bourassa, QC]

I'm sorry to interrupt you, but now we've spoken about health care and housing and we have a study on public transit. How do you manage your priorities? Should we have a dedicated fund? It will have an impact on the other priorities. Health care is the number-one issue, of course.

[The Chair, Conservative, Merv Tweed]

I have to intervene here. We're way past the time. Maybe you can fit the answer into another question, if it comes your way.

Monsieur Poilievre.

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

You mentioned the idea of increasing the GST in order to fund municipal priorities. Do you acknowledge that Canadian taxpayers are tapped out, that they can't pay any more? Whether it's property taxes or consumption taxes or income tax or other business taxes, there's really only one taxpayer. It doesn't matter which tax you raise, you're still taking money out of the pocket of the person who earned it and putting it into the coffers of government.

Do you not acknowledge that taxpayers are paying enough already?

[Paul Moist]

I was a big supporter of the move to dedicate a portion of the gas tax to municipalities and to working with municipalities to use that to bring down the infrastructure deficit. And I was a big supporter of Mr. Flaherty's two budgets in the midst of the recession. I think that stimulus was required. But on your broader question, we're actually at historically low levels of spending on public services in Canada, as a percentage of gross domestic product. We are at levels that are lower than in 1960.

There's a lot of wealth out there in society; it's not all in governments' pockets. But as a percentage of the overall wealth of Canada, we're at 50-year lows.

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

What is the percentage?

[Paul Moist]

The percentage of GDP being spent on public services right now is under 30%. Toby Sanger will probably have the exact number.

We're at the lowest levels we've been in 50 years. The economy has grown. Public spending doesn't have to keep pace exactly with all growth in the economy, but the opposite has happened.

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

Can you give me a breakdown of that 30%?

[Paul Moist]

I'm talking total governmental spending, all forms of taxation, as a percentage. It's in the index to Mr. Flaherty's budgets each year.

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

I didn't bring the index today.