Transport Committee on Feb. 13th, 2024

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Barrieau and Mr. Barsalou-Duval.

Next we have Mr. Bachrach.

The floor is yours. You have six minutes, sir.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair. I'll start with some questions for Mr. Dobrusin.

Mr. Dobrusin, I read over the brief that you provided the committee, and it's very detailed and interesting and really lays out and describes in detail the pitfalls of the public-private model when it comes to rail development around the world.

Given the track record of public-private partnerships in the rail sector internationally, why do you think the Government of Canada seems so hell-bent on proceeding with such a problematic model for this HFR project?

[Bruno Dobrusin]

That's a very good question.

I think there's a similar pattern to what we've seen with other governments around the world. There is this idea that by doing a public-private partnership it's going to be less expensive for a government budget and the government will not ultimately be responsible for it. I think this is one of the key motivations behind why any government is really going into this. We're not going to spend much on it. It's going to be the private sector, and also we're not going to be responsible for operations, so if anything fails or there are any problems, we can put it on the private sector as well.

I think those two are key mistakes, because at the end of the day what we've seen across the world in the vast majority of public-private partnership projects is that it ends up being on the public and it ends up being on the government, and not just the federal government but the other levels of government that may also jump into a proposal like this.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

There isn't really a risk transfer to the private sector, then. In the end it's the passengers and the citizens who end up paying for the rail project, regardless of what model is employed. Do they end up paying more or less, in your view, under public-private partnerships?

[Bruno Dobrusin]

The evidence is they end up paying more. I think the example of the U.K. may be one of the most tangible for us to see. After 30 years of rail privatization and public-private partnership projects all over its rail system, it's now one of the most expensive rails in Europe, not just to operate but for the passengers. It also has worse working conditions for workers when compared to other systems, like the French or the German ones, which have remained in public hands.

On top of that, they had to extend contracts. When you look at the Eurotunnel, which was a public-private partnership project, they had to extend that concession by 40 years because the profits of the private concessioners were not guaranteed in the original span of time they had said, which was 55 years. That's another example where the public ends up paying and also we pay more than originally stipulated.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

You mentioned your two Canadian affiliates, Unifor and the Teamsters. It's wonderful to have Mr. Kennedy here with us as well.

Do your affiliates in Canada support the government's current approach to HFR?

[Bruno Dobrusin]

I'll pass it on to Joel to respond to that.

[Joel Kennedy, National Rail Director, Unifor, International Transport Workers' Federation]

Currently, no, we don't. Our position, as we mentioned on November 6, when we had our elected representative Jen Murray come and do a presentation for this committee, is that we don't support the government's proposal on HFR.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Does it not seem misguided to forge ahead with a project model that isn't supported by the two main labour organizations that represent the people who are going to be operating the trains?

[Joel Kennedy]

It certainly is irresponsible, in our view. I think both the stakeholders, the Teamsters and myself...and I can speak on behalf of the Teamsters. I have their blessing. They agree with our position and they wholeheartedly stand behind us in this regard.

With proposals like this, we've seen that they are not thought-out. They're more whimsical, and it's more of a pipe dream. What we need here in Canada is a well-thought-out plan for a national transportation network that's accessible to all Canadians, that is going to be a gold standard for the next hundred years, and that's also in line with our green initiatives.

When we see private enterprises come into these proposals, as my colleague, Bruno, has also mentioned, we see working conditions, wages and all sorts of things towards health and safety diminish as well.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Mr. Dobrusin, you're familiar with some of the companies, both private and state-owned, that are currently putting forward proposals for the HFR project. What are those companies' records working in other countries on other rail projects? Do you have concerns in that regard?

[Bruno Dobrusin]

I will say that they have a unique record. It's a pattern, I think, with many other companies. What I think is sometimes shocking for us to see is the difference between how they operate in their home countries, where they're often publicly owned and state-led—Keolis being one example that is one of the bidders here—and how they operate abroad, including in North America, in the U.S. and Canada, where Keolis has a large presence. They do not follow the same patterns here that they follow at home.

One of our biggest concerns is how they deal with labour relations, for example undercutting staffing and trying to review collective bargaining agreements that were in place before it was privatized and now are under their management. They're reviewing them to lower the overall operating cost, because usually these companies basically try to underbid each other, and one of the areas where they cut in those bids is labour costs. That later transfers not just to working conditions but to safety as well.

Another of the operators you mentioned is Renfe, which is a Spanish-owned operator. We've also seen problems with Renfe. They're part of one of the bids in the Texas project for HSR that has been delayed for I think about a decade. Renfe has just gone through a change in its management because of a corruption scandal in Spain.

Nobody has a perfect record on this, and certainly these are concerns that we have.

[The Chair, Liberal, Peter Schiefke]

Thank you, Mr. Dobrusin, and thank you, Mr. Bachrach.

For a second round, we have Mr. Muys.

Mr. Muys, the floor is yours. You have five minutes, sir.

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Thank you. I have more questions for Mr. Barrieau.

You talked about how in the Montreal-Quebec City corridor HFR basically will render Via.... Well, it would basically take all of their passengers and make it economically unviable. Beyond the passengers going from Montreal to Quebec City, you have those in the outlying stations that could be using provincially or municipally operated transit lines, frankly, rather than HFR.

I'm wondering if, in your view, if you've looked at the Ontario side of the proposed route—because it does run a little more northerly, through Peterborough—whether that's the same case, and whether it's Toronto to Ottawa, or Toronto to Montreal, we'd cannibalize the Via passengers, and whether there would be any benefit beyond that.

[Pierre Barrieau]

Well, I think the same model that I propose for Montreal could potentially be a partnership built between GO Transit or Metrolinx with Via Rail in extending a few of their trains to Belleville, for example, or something like that. The reality is that going by Peterborough.... I mean, we're using the old CP line. It is a complicated line. It's not an easy line to get to Toronto. As well, there are issues in entering Toronto from the north. Historically, it's easy to enter Toronto from east and west. There's a lot of rail infrastructure that's available. There are rights of way. The Peterborough line fixes a lot of the problem until you get to suburban Toronto, and then you're jammed when trying to get to downtown.

To get to the other question, that being the stations, fundamentally we have to find ways so that people don't feel abandoned by this project, but at the same time we have to also look at the greater good and how we can combine the greater good with the local good. That's the way we will be able to get the buy-in for this project.

It is exactly by building those partnerships with the local transit authorities to keep a relative level of service that they won't feel totally abandoned and won't turn against the project. We have to build those relationships, though, and that means partnerships between federal, provincial and regional operators.

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

What you're saying, then, basically, is that for HFR to even work, GO and Metrolinx are going to have to build those lines that don't exist to Belleville and other places like that.

[Pierre Barrieau]

Well, it could be as simple as, for example, expanding a few trains or something like that. There are strategies that are there. The network is there. If Via Rail is disappearing on the CN main tracks and whatever, we're going to be liberating capacity.

We also have to see this at the same time as adding more capacity for freight. Let's not put our heads in the sand. For the little revenue they're getting, CN's not going to be sad at seeing Via Rail disappear. It's going to give them a lot more flexibility on their network, and it's going to give them a lot more potential traffic for their freight without having to invest in the infrastructure.

In the end, everybody benefits if we do it correctly.

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

What about the timelines proposed? We've already seen a couple of delays in the early parts of the process. Do you think they're realistic? When do you foresee—if all goes on time from here on in—this operating and reaching a critical mass so that it has enough ridership to be viable?

[Pierre Barrieau]

I think there are certain segments where we can get into high gear as soon as contracts are signed, and get them operational, including Ottawa-Montreal. It's a line I use. It's Via Rail-owned, with almost no expropriations needed to get it done. It's a short distance. We can do that.

What's going to be difficult is the western portion of the line, where there will be a lot of changes in the route. Even if we buy the CP route, there are a lot of curves that are tight. We're looking at expropriations that are going to take many years. Look at the U.S., where expropriations have historically been absolutely horrendous on high-speed and high-frequency rail systems.

For me, that's the biggest hindrance to the timeline of this project: expropriation. We can build this thing in about 10 years. However, how long will it take the courts to allow us to bring in our shovels and work on those properties we need to get to?

[Dan Muys, Conservative, Flamborough—Glanbrook, ON]

Let me turn it over to our friends from the International Transport Workers' Federation. They haven't had as much say in this discussion thus far.

I'll ask a similar question in terms of the timelines you've seen, read and heard about for this project.

Based on your expertise in building these things, are they realistic? What are the red flags? What are the causes for concern?

[Bruno Dobrusin]

Thank you.

From what we've seen, this is a commonality among PPP projects. The timelines get more extended than originally thought. As the other speaker mentioned, the U.S. is an example of very long delays on HSR and HFR. I think there is sometimes a difference in Europe or locations where there is a stronger control of state-led companies. As we discussed here, they have more control and more familiarity in dealing with other levels of government than some of the private operators being proposed here do.

I think, from what we've been able to gather, that this is going to be a further-delayed project. What can also come into play is the state of those private bidders bidding under certain conditions now. They're probably going to want to change how those bids were done a few years down the line, and that's going to potentially delay the projects even more.

[The Chair, Liberal, Peter Schiefke]

Thank you, Mr. Dobrusin, and thank you, Mr. Muys.

Next, we have Mr. Rogers.

Mr. Rogers, the floor is yours. You have five minutes, sir.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thanks, Mr. Chair.

I'll be sharing my time with my colleague Ms. Koutrakis. We'll split the time here.

First of all, welcome to the panellists. It's always great to hear from people with knowledge and expertise. You're providing the committee with the benefit of your views and opinions on this project.

Mr. Barrieau, when the government announced its two bids, the big key factor was a speed of 200 kilometres an hour for one, while one referenced high speed. Of course, the debate is ongoing about what it is we should be doing and why we should be doing it—whether it's for economic reasons or moving people and goods, with timelines and these kinds of things.

Do you believe higher speeds would be beneficial to this project? Are they critical to whether or not this project is a success?

[Pierre Barrieau]

High-frequency rail is going to be competitive with the automobile. High-speed trains are going to be competitive with the airplane. It depends on what your final objective is.

I have a certain vision. I believe Air Canada would abandon most flights served by high-speed trains. The trains would enter directly into the airports. It would be codeshared. I might even be able to get my Air Canada lounge benefits or Aeroplan points using Via Rail. If I'm out west, I'm able to get my WestJet points when I'm using the Calgary-to-Edmonton line. That's the dream I have. That integration cannot be done with high-frequency rail. That integration can be done only with high-speed rail.

If we choose high-frequency rail and not high-speed rail, we won't be able to significantly diminish air traffic in the triangle or these short flights, which are those—if we look at Europe—that can easily be replaced by trains. In this case, if you want to diminish airport congestion, remove a flight from Ottawa to Montreal. It's a shame for the 14 people in that plane, but if I can replace that flight with a new flight direct to, I don't know, Johannesburg, what will the better economic impact be? I think the better economic impact is to have a Montreal-to-Johannesburg flight at the airport, rather than a Montreal-to-Ottawa flight.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thank you very much for that perspective. I appreciate it.

I'll turn my time over now, Mr. Chair, to my colleague.