Transport Committee on May 2nd, 2016

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

In hindsight, and hindsight is 20/20, I think that ultimately it is in principle a good thing to privatize certain companies. However, in a sense the Mulroney government only went halfway. They couldn't quite make the break. I don't know if it was because there was some sentimental attachment to Air Canada or some political factors came into it but they said Air Canada was on its own but it must do this. If you're going to privatize a government-run organization I think you wait until you're ready to go the whole way. In that sense it's something that perhaps is a lesson for us in any potential decision in the future for Canada to privatize anything.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Minister, earlier you mentioned four obligations that accompanied the privatization of Air Canada. Can you tell us if the company fulfilled those obligations?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

We know the history as to maintenance, but with regard to the three others, its head office is still in Montreal.

Regarding official languages, the Commissioner of Official Languages drafts reports from time to time on Air Canada's respect or lack of it for official language requirements. The commissioner has sometimes criticized the company and continues to be vigilant in this regard. Air Canada has in the past been criticized on the issue of official languages.

As for the third point concerning foreign property, this has not changed, from the beginning. This is not something contentious at Air Canada at this time. The same requirement applies to all the other airlines in Canada, that is to say a 25% maximum.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you.

Mr. Hardie, you have one minute and 15 seconds.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

Thank you, Madam Chair.

I have to go back to my first question because you gave me a different answer.

I was talking about the benefits that Air Canada got when it was set up. It had aircraft given to it, route rights, and slots at major international airports. The aircraft are long gone of course but the others were worth a considerable amount of money especially for an air company just starting out.

Are there ongoing benefits from that original deal that give Air Canada an advantage over its competitors?

[Catherine Higgens]

Thank you for the question, and I'll attempt to respond to the benefits.

The act was put in place as a framework for the privatization of Air Canada to move it from a crown corporation to a viable and competitive private entity. That has occurred while Air Canada has maintained aircraft activity in Canada. The purpose of the initial privatization has led to an air carrier that is competitive but that is subject to requirements 30 years later under the current act but that are not made applicable to its competitors, either domestically or internationally. While it has achieved the benefits of the ACPPA this is an obligation that could impact on its competitiveness going forward.

[Ken Hardie, Liberal, Fleetwood—Port Kells, BC]

I'm sorry, that is still not the answer.

Are they getting an advantage that the other airlines are not getting from the original deal, i.e., the international routes and the access to those other airports?

[The Chair, Liberal, Judy Sgro]

Give a short answer, if possible.

[Catherine Higgens]

Canada has a very competitive air sector policy that relies on competition and competition on its international routes, and where possible, open access for competitors to provide the best service level and costs for travellers and for Canadians. In that sense, it does not have a residual benefit from the privatization.

[The Chair, Liberal, Judy Sgro]

Thank you.

Mr. Berthold.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Thank you very much.

Minister, I am happy that we can continue our conversation.

Earlier you mentioned that I suggested that the maintenance of Air Canada aircraft might be of inferior quality. That comment was inspired by a statement made right here, on Parliament Hill. If I may, I will quote it: “[...] while the government refuses to invest in what has made this country strong, and thousands of Canadians who travel every day are being put at risk with potentially lower-quality maintenance; it's not right.”

Mr. Garneau, Mr. Justin Trudeau made that statement in the past when speaking to Aveos workers on Parliament Hill. I simply wanted to let you know why I am concerned that our maintenance may be of poorer quality. If I understand correctly, this does not concern you.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I would say that the situation has changed since 2012.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

What has changed exactly?

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

We didn't know exactly what was going to happen. Today, four years later, the picture is clearer.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

What has changed exactly since 2012? The same proceedings are before the court, and the same workers are still waiting for answers.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

What has changed—

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

The Government of Quebec told you not to move. That is what has changed. The Government of Quebec does not want us to change the law.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

I do not agree with your interpretation of what the Government of Quebec is telling us. Quebec is very well aware that we are all moving forward in this dossier. It indicated clearly that it intends to drop the suit when Air Canada signs the contract.

I think Ms. Anglade was invited to come and testify before this committee.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

She is on the list of witnesses who have been invited to appear.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

Madam Chair, has—

[The Chair, Liberal, Judy Sgro]

Yes.

[Marc Garneau, Liberal, Notre-Dame-de-Grâce—Westmount, QC]

Whether Ms. Anglade comes to testify or not, I think she will send you a document. I would encourage you to put this question to her.

I am sure that Ms. Anglade understands very well that we decided to amend this law because we were aware of the Government of Quebec's intent. All of these things take a certain time, as I said.

[Luc Berthold, Conservative, Mégantic—L'Érable, QC]

Before Ms. Anglade appears before the committee, I am going to quote her. She said this:

What we want is that this be kept in Quebec, generally speaking [...]. As for the change they are proposing, we don't want this to interfere with the agreement we have with Air Canada and the fact that we are in court.

The correspondence the Supreme Court received came from the plaintiff, Air Canada, and the defendant, the Attorney General of Quebec. There was an agreement between the parties to postpone the decision to request leave to appeal. There is no agreement aside from the request to postpone the decision on the appeal.

While we wait for Ms. Anglade to come and answer our questions, I think it would be relevant to contact the Government of Quebec to find out exactly what measures it would like Ottawa to take. We don't want to interfere with the creation of the maintenance centres. You are proud of this, as are we. We want these things to be done here, but things should not be done in a rush and hinder the establishment of these centres.