Transport Committee on March 21st, 2018

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Sohi.

We move to Mr. Chong for five minutes.

[Michael Chong, Conservative, Wellington—Halton Hills, ON]

Thank you, Madam Chair.

Thank you, Minister Sohi, for appearing in front of us today.

I first have a comment about your infrastructure plan, and second I have a few questions about the Windsor-Detroit Bridge Authority and federal bridge policy in general.

My comment on infrastructure is that during the last election you promised, among other things, three things in particular for infrastructure. The first was that you would run deficits of no more than $10 billion a year in order to fund historic investments in infrastructure, which was the second commitment, and the third was that any unspent money, any lapsed money, would be transferred into the gas tax fund to top it up.

Instead, what I see here in the estimates and also in the most recent budget is that your deficits are much larger than $10 billion a year and that you're not spending the money that you promised on infrastructure. In fact, last week the Parliamentary Budget Officer said approximately one-quarter, 25%, of the money promised is not being spent. That money, in the government's language, has lapsed and is being reprofiled for future years—much of it after the next election, I would note—so two of these commitments are not being met.

The third commitment is also not being met. While there was some modest transfer in the last while into the gas tax fund of lapsed, unspent money, you're not fulfilling your commitment to transfer everything that was lapsed, everything that was unspent, into the gas tax fund to be transferred to municipalities across this country. I just make note of that, because I think Canadians clearly voted for that in the last election. They elected a majority government, but this commitment, these three commitments, are not being lived up to.

I have a few questions about the Windsor-Detroit Bridge Authority. Thank you for the information that the proponent is going to be selected shortly and that construction will begin in the fall of this year. That's good news.

I have a few questions, though, regarding the general policy of the government with respect to the tolling of federal crown corporation bridges.

We built, some years ago, a bridge crossing the Northumberland Strait to Prince Edward Island, which cost in excess of $1 billion. That bridge was in part to uphold our constitutional obligation to P.E.I.'s entry into Confederation to provide a year-round link to the mainland. The people who use that bridge have to pay $46.50 to cross it. I've actually used it a number of times, and it's expensive. It's not cheap to cross. You pay the toll one way, but it's still an expensive toll to pay.

We have a proposed toll, which is yet to be announced, on the Gordie Howe bridge, which is going to be quite high, I think, because the costs are now estimated to be upwards of four and a half billion dollars.

Then we have a third bridge that is also owned by a federal crown corporation. It crosses the St. Lawrence River, connecting the south shore of Montreal to the Island of Montreal, and that bridge was once tolled. That toll paid for the construction of the original bridge. We're now building a replacement bridge, but there's no toll on that bridge.

I don't see how that's fair to the people that I represent in Wellington County, Halton region, and southwestern Ontario, who are being asked now to pay the toll for the most important bridge crossing in this country by far, the Windsor-Detroit bridge crossing. I don't see how it's fair to the people of Prince Edward Island, who have to pay this toll of $46.50 to cross to the mainland when in another region of the country there is no toll because the government made a decision that makes no sense to waive the toll just for the residents of that particular region.

I'd like the minister to explain the rationale behind federal bridge policy and tolling.

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

We are proud that we are building the Champlain Bridge and that we are making it toll free. The decision to impose a toll was made without any consultation with the City of Montreal or with regional municipalities or with the business community or with the people who will be using this bridge.

This is a replacement bridge. The Champlain Bridge is not a new bridge. People in Montreal use the existing bridge without paying for it. That's the reason this bridge will not have a toll.

Gordie Howe International Bridge is a new crossing. There is nothing that is owned by the federal government. It's a private bridge that people pay to use.

The distinction we make is this: when we are replacing existing infrastructure for which Canadians are not paying, we do not charge a toll. We charge a toll where we're building something new, and there's a price to that.

On gas tax funding, let me make it clear that when we got into government, there was close to $1 billion unspent, unallocated, from the previous government, and we gave one year to all the proponents to give us the projects to be funded through those dollars. I'm proud to say the majority of those dollars are now attached to the funding. There was some funding that remained, and we transferred that to the gas tax.

I respectfully disagree with my colleague that we are not delivering infrastructure. I'm proud that we have given approval to so many projects in the last two years—4,100 projects with a combined investment of $35 billion. Almost 90%, or more than that, based on the information we have, are under way. Those are projects creating jobs in communities. I have given examples of some projects. Close to 2,000 new buses are being bought with those investments. Water systems are being replaced. Cultural recreational facilities are being upgraded.

We're delivering on all of the commitments we made.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Minister.

We'll go on to Mr. Sikand.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

Thank you, Madam Chair.

Minister, I would like to start off by thanking you. You recently made an announcement in Mississauga for funding for transit. I think it was close to $339 million under the bilateral agreements. Thank you for that. I've heard positive feedback, as it's going to help improve MiWay. People in my riding use that service heavily.

Turning to my question, my colleague mentioned the PBO report. Minister, I would like to ask you a question in regard to reprofiling. We've read about the reprofiling of infrastructure funding lately. I feel this is something Canadians don't quite understand. Could you please elaborate?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

First of all, congratulations on the funding. That $338 million will leverage close to $1 billion in investment in public transit in Mississauga. We are proud of that.

That's a very good question you're asking. We appreciate and acknowledge the report from the PBO, because this is a challenge we have faced. This is not a new challenge. It's the same practice that previous governments have followed—namely, once we approve a project, there's funding attached to that project, but it takes a number of years for the project to actually be completed. We have to wait until the project is completed. Then the project proponents, which are sometimes provinces and municipalities, have to wait until we get the invoices to pay out the funding, the federal share of that commitment, at the project's completion.

For example, we have approved a large project for the City of Calgary, the southwest ring road. The construction is happening, jobs are being created, work is being done, and the funding we have attached to that project has not been paid out yet. The reason is that we will have to wait until the project is completed before we get the invoices. What we have to do is continue to reprofile that funding into future years. That's the challenge we have, and we are trying to figure out the solutions.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

Thank you. It makes sense to me.

I want to circle back to the funding announcement you made in Mississauga. Could you elaborate on how the bilateral agreements tend to work?

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

I take a lot of pride in the way we work so closely with provinces, municipalities, territories, indigenous communities, and many other partners, because this is a shared responsibility. We make the funding available, but it is actually the proponents, our partners, that build that infrastructure. In your case, Mississauga will be building that infrastructure.

In order for us to deliver on those commitments, we need to work with them. That's why bilateral agreements that we are signing are so transformational in how we give them the flexibility. We empower local decision-making and we come to the table as partners.

[The Chair, Liberal, Judy Sgro]

You have two minutes left, but we'll move on. If no one is picking up your time, I'm on to—

[Vance Badawey, Liberal, Niagara Centre, ON]

Whoa.

[The Chair, Liberal, Judy Sgro]

Well, then be prepared, because we have a tight schedule.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

I'll pass the remainder of my time to my colleague.

[The Chair, Liberal, Judy Sgro]

We have two minutes that are being eaten up, so....

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Madam Chair.

Thank you, Minister, for being here today, as well as members of your team.

It was mentioned by the opposite side, by the Conservatives, that the recommendation is to bring some of the infrastructure funding into the gas tax. I want to go to that, because I'm sure there's a reason for it. In my former life as a mayor, I recognized how valuable the gas tax was, but at the same time, I recognized how valuable this sustainable funding envelope, the $186 billion that you've announced, is and will be moving forward. Could you explain the difference?

Correct me if I'm wrong, but the gas tax contribution is 100% federally funded, whereas the $186 billion can be equated to or equalled up to $558 billion when you factor in the ability to leverage with the provinces, the territories, and the municipalities. It's sometimes even more if you include the private sector.

If you could elaborate on the benefits of that strategy versus simply having the 100%-funded gas tax, I would appreciate it.

[Amarjeet Sohi, Liberal, Edmonton Mill Woods, AB]

The commitment we made was that any lapsed funding will be transferred to municipalities through the gas tax funding. None of our current infrastructure funding has lapsed. It is either tied to the programs or tied to the projects that we have already approved, and those projects are going ahead. It would be very irresponsible to take that money and transfer it to the gas tax funding. Then how do you meet the commitment that you've already made to those projects? That's why we wait until the programs are wrapped up, and if there is any money then, we transfer it to the gas tax.

You're right about the leveraging, and we leverage the majority of the funding. As I said, $336 million for Mississauga will generate $1 billion of investment into public transit.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Go ahead, Madam Sansoucy.

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

Thank you, Madam Chair.

I want to say hello to the minister and those who are accompanying him.

It will be my pleasure to ask you questions soon.

That said, Madam Chair, I would first like to table a notice of motion presented by my colleague Robert Aubin, member for Trois-Rivières, on Friday, March 16. I will read it.

That the Committee undertake an emergency study of no less than three meetings on:

- the measures that the government intends to take in order to prevent any future delays in the implementation of infrastructure projects;

- the details on the progress of infrastructure projects to date; and

- a full update on the government's plan to spend $186.7 billion on infrastructure;

and that the Committee make recommendations and report to the House by June 2018.

Madam Chair, I hope you will find unanimous consent among my committee colleagues for undertaking this urgent study.

[The Chair, Liberal, Judy Sgro]

Madam Sansoucy, would you prefer to hold this until we do our committee business at 5:15?

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

Yes, if the committee agrees.

[The Chair, Liberal, Judy Sgro]

Even though this is all about infrastructure—

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

There is no problem. I can start to ask my questions.

[The Chair, Liberal, Judy Sgro]

We'll hold this down until committee business at 5:15, if that's all right with everyone.

Thank you.

Continue, Madam Sansoucy. You still have the floor.

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

So I have five minutes starting now, Madam Chair?

[The Chair, Liberal, Judy Sgro]

Yes, you do.

[Brigitte Sansoucy, NDP, Saint-Hyacinthe—Bagot, QC]

Thank you.

We will begin with the Infrastructure Bank of Canada, Mr. Minister.

What specific measures have you put in place to guarantee that both the managers and administrators of the Infrastructure Bank will not be in a conflict of interest when it comes to the bank's investment projects?

I will tell you concretely why I am asking that question. Ms. Jane Bird is a senior business adviser in the Bennett Jones LLP law firm in Vancouver, an important Canadian law firm, where she provides advice to public and private sector clients about issues related to the development and execution of various infrastructure projects.

Can you confirm to us beyond any doubt that the administrators' businesses will not profit from the Infrastructure Bank's investments?