Transport Committee on Sept. 28th, 2017

[George Iny]

The recall correction rate is around 70% to 75%, so about one out of three is not fixed. It varies depending on how new the vehicle is and how long the company waited before the recall. In your first couple of years, you're well over 90%. If it's a six- or seven-year-old vehicle, and it's in the hands of second or third owners, it could be around 50%.

[John Raymond]

Or less.

[Sean Fraser, Liberal, Central Nova, NS]

I'm curious as well if you think there's room for a public education campaign or something around this as well. I think most people who have recalled vehicles that are more than a couple of years old may never find out that that there's a defect. Is there another angle outside of the legislative process we can launch to complement the safety measures inside the legislation?

[George Iny]

There are many things that companies could do to reach their customers more effectively. Obviously sending a letter to the last address in your record, which is probably the first address of the original owner, is not the most effective way. Companies could do more. The public has a role to play as well, and some people don't bring in their cars.

We're able to collect parking tickets, right? You put a boot on it or you hold up the renewal of the registration. I'm not formally proposing that today, but I'm saying that if we wanted to, if we put a higher priority on recalls than parking tickets, we would have a higher correction rate.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Iny.

Go ahead, Mr. Aubin.

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

Thank you, Madam Chair.

Thank you for joining us, gentlemen.

My first question will go to Mr. Iny, but the other witnesses may feel free to add to his reply if the spirit moves them.

Mr. Iny, in previous testimony before the Senate, you talked a lot about the usefulness and the importance of more investment in road safety research. You talked about it again just now. Earlier this week, we heard from the Auditor General. I must tell you that his testimony on the subject was quite concerning.

You submitted a proposal for an amendment, whereby all or part of the money collected in fines would be redirected to research. What effect would that have? Do you want all or part of the fines invested in research?

[George Iny]

We have not decided if it should be all the money collected, but we would like an amount set aside to subsidize university research and field research in order to help the people at Transport Canada who sometimes have to wait years to get the evidence or the money they need.

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

What is the difference between university research and the crash tests, or the research done at Transport Canada?

[George Iny]

Ideally, university research should focus on the aspects that Transport Canada does not examine, or may not have even thought of examining. For example, checking the effectiveness of regulations is done by Transport Canada, but perhaps an external team might have a broader vision and might uncover problems that perhaps escaped the regulatory authority.

It could also focus on more than just the automobile. For one thing, the behaviour of drivers could be examined, with the goal of reducing injuries or deaths.

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

Let me pursue the subject of fines.

The amount of the fines is not established in the bill. It will be established in regulations later. Do you have an idea of the size of the fines that would be needed, given the means available to manufacturers, to make them a genuine deterrent?

[George Iny]

There are two theories on that.

The first theory says that seven-figure fines would be necessary because manufacturers pay no attention to fines until they are in the millions of dollars. The second theory says that publicity plays a role, because it can tarnish a company’s reputation. We subscribe more to the second.

When fines are too high, they are not levied. The companies simply refuse to pay them.

Levying fines is not in Transport Canada’s culture. The ideal is to make them as mild as possible so that they become a tool.

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

I was particularly surprised by another item in the Auditor General’s report—perhaps you are aware of it. He told us about an anchor for a child car seat that had defects and that should have been modified. It seems that it was not, because it would have been bad for business.

Can business take precedence over automobile safety? Is this rather an illustration of the imbalance between the lobbying power of the large manufacturers and the power of motoring associations, consumers, the police, or any other organization that focuses more on safety than business?

[George Iny]

It was more the case in another era. Today, I can tell you that things are different and that people don’t often think about it. There has to be a balance.

Actually, the way in which the legislation is drafted does not allow calculations to be made before a demand to rectify a commercial problem.

There is a lot of debate about safety on board school buses, but in fact, there has been not one death for a number of years. The deaths occur in the area around the buses and that is where most effort should be focused. The child seat anchor is more or less the same thing.

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

Thank you.

[The Chair, Liberal, Judy Sgro]

You have 20 seconds.

Go ahead, Mr. Hardie.

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

Thank you, Madam Chair.

Mr. Iny or Mr. Raymond, I'm concerned that quite often we see an issue come up as a consumer issue: that the performance of a vehicle is not reliable and it's doing some things that lead to frequent trips to the repair shop, etc.

In your view, are consumer issues watched carefully enough to ensure that, if they start to become a safety issue, this is then raised with Transport Canada?

[George Iny]

You have grey areas, but I would tell you the culture and the oversight around safety is much more disciplined. You have a federal regulator, whereas if it's product performance, it's provincial; and the provinces, even though they have good laws on the books for defective products, don't actually have any muscle and are not really even engaged with the carmakers. That's why you have class actions, unfortunately. Often the reason that you wait until you have thousands of unhappy people is because the gatekeepers along the way are not actually effective.

I would say in most cases, yes, there are some grey areas. The brake booster is one. Ford's argument was if your brakes are lousy, go and get them repaired. The vehicle will still stop. It's just the booster. That's not the brakes. That's just the booster. Transport had another view, as did some of the vehicle owners.

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

Oversight is difficult. There are literally a lot of moving parts involved, both in individual vehicles and the fleet as a whole.

We have to be concerned about the performance of the various regulatory agencies. You mentioned provincial, which is outside our scope, but in Transport Canada itself, I was concerned by the Auditor General's report. They cite an incident to do with side-door strength. The U.S. implemented a standard in 2007. It took nine years for Canada to take the same step. Maybe, Mr. Jack, you can comment on that. Is that something that CAA has been following?

[Ian Jack]

Yes. One of the reasons we think this is good legislation is because of what it says. It's also sending a signal, we hope and we think, inside the bureaucracy at Transport Canada road safety that they're valued. We hope this will be a morale boost for them, frankly, signalling to them that they're expected to be on par with their U.S. counterparts.

We have had, historically, a system in this country where we wait around for the Americans to decide something and then we say, “Us too.” We do a perfunctory look at it so we can claim to have done it separately in Canada, and then we say, “Us too.”

If the Americans aren't acting on something, we tend not to. I think we need to change that culture and that attitude. The Auditor General's report was a wake-up call on that. I think this legislation sends a very positive signal inside the department, as well, that they have the backing of Parliament and their political masters to be a bit more rigorous.

[George Iny]

If you want the same result, you need more resources in many cases. Some of these delays are because they just don't have the bench strength. I also would like to believe that the people who waited those years knew that we were getting the same doors here as in the States because it's continental production. That is our wish. When there are some of these delays, at least someone has considered that we're getting the benefit without having the law, and I think that does happen at times.

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

That's good to hear, actually.

With respect, though, to Transport Canada, an inference was that, as opposed to not necessarily having the bench strength, it was more a matter that their prioritization, what they were spending their time doing, maybe was misaligned from their core functions. That's a pretty broad statement, but have there been any observations of that?

[George Iny]

Yes, there are times when we wonder what's happening at the top. I would also say that certainly on the investigation side, it's a very small team. It doesn't have a lot of money. It cannot do a lot. What it does with what it has is quite impressive, and that came out in the Auditor's report as well.

I think by giving the government more tools, and hopefully eventually the resources to follow them, that instead of being focused on penalties, these amendments would allow us to focus on good practice or best practice, and then you would need a change inside the government as well, a different form of engaging with the carmakers.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Badawey.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Madam Chair.

I'm going to dig a bit deeper into some of the solutions. We talked about recalls. Mr. Lobb talked about purchasing a vehicle, whether it be at an auction out of country.... There is a process right now, at least in the province of Ontario, whereby when you do purchase a vehicle, you get the full history of the vehicle. You get a full page of vehicle history. Is that an opportunity to actually identify the vehicles that would have a recall attached to them?

The second opportunity, of course, is when you buy a vehicle. You also most times do a safety check, whether it's already safety-checked.... Of course, that's another opportunity, again, once the VIN's punched in, to actually identify and recognize that a recall is in order.

Do you think those are two mechanisms that can be used, and/or do you have any other ideas that can be used to actually catch a recall when a vehicle's being sold, whether it be within a country or from another country?

[George Iny]

I think more appropriately those would be called two missed opportunities, because the governments talk past one another. Ontario only recently revised its safety standard certificate but did not include a recall lookup or, as far as we know, did not even sit at a table with industry and the federal government to see what could be done about it. Probably the solution will come from the private sector, unfortunately. Once there is a widely available database that you could look up, I suspect there will be an aggregator, like a CarProof or a CARFAX, that would consider doing what the governments haven't done.