Transport Committee on Sept. 26th, 2017

[Michael Ferguson]

Madam Chair, we haven't done that type of mapping to what's proposed in the bill. I guess as auditors, really what we did is we did an audit on a particular topic. We found a number of places where there needed to be improvements. We made some recommendations.

The department may feel that some of those recommendations can be dealt with by changes to the legislation. As auditors, our approach is always to wait and see, and probably at some point we'll go back and do a follow-up and see whether the department is having more success at being able to access information about what the manufacturers are aware of and are investigating.

[The Chair, Liberal, Judy Sgro]

Mr. Badawey.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Madam Chair.

Although we're on opposite sides of the table, I think we're heading towards the same sort of vision or direction, especially given Mr. Chong's comments earlier with the minister, of looking down the road and utilizing this process as something of a lever to be more proactive. That's what I want to address.

Do you feel there is an opportunity to take what you've done—and I might add that it has been very in-depth—to encourage the development of an enhanced auto economy by way of incentives, leading into the future, and somewhat anticipating what those new technologies will be?

I spoke about this earlier with Minister Garneau. Do you feel there's an opportunity here to encourage new technology through innovation that will, one, develop proactive—proactive, not reactive based on defects—returns on environmental, economic, and social investments? Two, do you feel it will encourage new and improved product, produced right here in Canada, to obviously strengthen our overall GDP, but most importantly, to take that next step to fulfill the vision of being proactive in dealing with the possibility of future defects, environmental or social, and ultimately, of course, leading to economic growth?

[Michael Ferguson]

Madam Chair, throughout the audit, I think one of the main points that kept coming out was this issue of regulations not keeping pace with technology. In fact, in some instances, for things like some of the lighting systems that exist now in vehicles in Europe, which are innovative but are not allowed under Canadian regulation, when you look at things like lighting systems being that closely regulated while some of the intelligence in semi-autonomous or autonomous vehicles is not being regulated, I think our concern is that there's a mismatch between the regulations and the pace of technology.

I think, from an economic point of view, it certainly becomes a drag on economic activity if regulations are not keeping up and are prohibiting certain technologies that have been proven elsewhere to have safety benefits. I think, really, from an economic point of view, you want to make sure that the regulatory system matches the pace of the industry. That will allow the right technologies. That will allow the right innovation. That will make sure that the regulatory system is not a hindrance to economic activity.

[Vance Badawey, Liberal, Niagara Centre, ON]

That's great. That's good news. We do not see this bill or this process as one that will simply sit on the shelf and be done. No, it has to breathe. It has to move well into the future. Hopefully the regulatory process can keep up with the pace of technology. I appreciate that answer.

You made the point that Transport Canada had agreed with your seven recommendations and had prepared a detailed action plan. With respect to the audit itself, the 2016 Fall Reports of the Auditor General of Canada, what year did you actually go back to with respect to the concerns that you brought forward within your audit? What years did it actually cover?

[Michael Ferguson]

I'm double-checking here to make sure that I get it exactly right. The period of the audit was January 2010 to September 2016.

[Vance Badawey, Liberal, Niagara Centre, ON]

Okay. Has Transport Canada agreed with all seven recommendations and prepared a detailed action plan?

[Michael Ferguson]

They agreed with the recommendations and they prepared an action plan. That would have been presented to the public accounts committee.

[Vance Badawey, Liberal, Niagara Centre, ON]

I believe that's coming through public accounts to us pretty soon, from what I read today in the email we received.

With that said, for the action plan and moving forward with it, how long do you suspect the time frame will be?

[Michael Ferguson]

We can double-check and see what some of the time frames are that they have in their action plan.

Related to our first recommendation, “Transport Canada should provide regular public updates on the status of its regulatory plans”, in fact their expected final completion date for that was April 2017. There's another one here, our second recommendation, with a time frame of September 2017. Another one is January 2017, which they say is completed. There's one for October 2017. For some of these, the dates have passed or are soon coming up, so at this point it's not just a matter of what they're saying they're going to do. They should be able to tell you whether they have done what they had in their action plan, because many of the dates are in the past, in fact.

[Vance Badawey, Liberal, Niagara Centre, ON]

I would anticipate that there will be or may be opportunity for that to attach itself to what we discussed earlier with respect to those new technologies and the regulatory environment keeping up with those new technologies.

[Michael Ferguson]

The thing about an audit is that in the course of an audit, we have findings. We identify things that need to be improved. We make recommendations. The department agrees with our recommendations, responds to them, and prepares an action plan. All of those individual activities are important, but I think it's perhaps more important to keep the big picture in mind, which is whether all of the changes are being made to line up the regulatory system with what's happening in the industry and properly balance the safety and the economic and other considerations. I think, again, as you keep an eye on this issue, it's not just whether the department has taken the individual steps that it said it was going to take; it's more about whether they can demonstrate that it is leading to a more efficient and more responsive regulatory system.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Ferguson.

Mr. Aubin.

[Robert Aubin, NDP, Trois-Rivières, QC]

Thank you, Madam Chair.

Mr. Ferguson, thank you for being with us. My thanks also go to the members of your team. Your testimony is very enlightening. Earlier, when we received the Minister, I was wondering whether all the measures put forward were more like playing catch-up than a real proactive approach. I think we are starting to have quite a clear answer to that question.

I'd like to hear what you have to say about an aspect from your audit. You are saying that “Transport Canada did not develop motor vehicle safety standards to respond to emerging risks and issues in a timely manner”.

We now know that Bill S-2 will give the minister powers of exemption from certain regulations.

I would like to understand. Do we sometimes find ourselves in a situation where we could have advanced technology that is not accessible to us, like the headlights you mentioned earlier? Are we really faced with a road safety problem that we are not addressing because Transport Canada is not doing the tests?

Based on your audit, are we simply being deprived of advanced technology, or do we have a real safety issue?

My car certainly doesn't have the headlights you mentioned, but it has headlights.

[Michael Ferguson]

Generally speaking, we said there are a few situations where the technology exists, but the regulations to approve the technology are not in place. It can also be a matter of safety for the public.

Perhaps Mr. Domingue can add some comments.

[Richard Domingue]

The example of the headlights illustrates the situation well. That technology exists in Europe but is prohibited in North America, in both Canada and the United States. There are a number of reasons for that, but essentially there is the resistance from the Canada-U.S. Regulatory Cooperation Council. It is not on the list of projects for which the regulations have been approved.

In Bill S-2, as we discussed earlier with the Minister, there is an opportunity for him to make exemptions and allow vehicles that do not meet the standards to enter the Canadian market. Those headlights do not meet Canadian standards.

As the saying goes, the devil is in the details. Bill S-2 may help introduce into the Canadian market technologies to which we do not have access at the moment. We are sort of depriving ourselves of this technology for regulatory reasons.

[Robert Aubin, NDP, Trois-Rivières, QC]

Would I be reading your mind if I said that, if the Americans accepted this technology, we would have a parity clause, but Canada never takes the lead to change a standard like this with the Americans?

[Richard Domingue]

I can tell you that Transport Canada has been looking at the headlights issue for over 10 years. Their technological or technical argument is about the glare that those headlights could cause. However, the same lights exist in Europe, but the department will tell you that the road conditions are different, the roads are faster, narrower or wider there, and that, based on a number of criteria, what seems to work there may not work here. In addition to that, there is the issue with the U.S. regulations, which, for the time being, prohibit the coming into force of this technology.

[Robert Aubin, NDP, Trois-Rivières, QC]

Thank you.

I would like to hear what either of you has to say about one issue. It is up to you to choose who will answer.

A number of choices made by the Department of Transport over the last few years deserve to be questioned. One of the things you are wondering about is the $5.4-million investment in the test centre for a new external safety barrier. You seem to be saying that it is not necessarily the best use of resources at a time when they are scarce.

What do you think the problem is with this investment?

[Richard Domingue]

The problem is that the decision was to build the barrier, at a cost of $5.4 million, as you indicated, but the research budget was cut at the same time. Those funds would have been used to test the barrier. As indicated in the report, the budget decreased from $1.2 million to $492,000. We were wondering about building a $5.4-million infrastructure without the money to fund the research that needs to be done on the barrier.

[Robert Aubin, NDP, Trois-Rivières, QC]

Okay.

We are told that Transport Canada's new approach is to manage risk. You just said that the budget has been reduced by 50%. Should laboratory tests be restored as a priority, even if they are done outside, as well as the regional teams on the ground who are able to bring evidence to assess the risk?

[Richard Domingue]

Our job is not to determine whether a particular program is properly funded. The department has to decide whether $492,000 or $1.2 million is sufficient or not.

[Robert Aubin, NDP, Trois-Rivières, QC]

I was not talking so much about the amount as about what is most appropriate for public safety.

[Richard Domingue]

This barrier is useful. In Blainville, it was considered important and necessary. We raised this point because there is a contradiction between investing $5.4 million and not having the money to do the tests that follow.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Aubin. You're time is up.

Mr. Iacono.