Transport Committee on April 4th, 2022

[Marko Dekovic]

I'm not an expert on container manufacturing, but I would say that, with the time it would take, it would probably be too late. By that time, the system will have normalized itself.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you.

My next question is for Mr. Gooch.

Mr. Gooch, you have made recommendations on how the national trade corridors fund could be improved to meet the urgent port infrastructure needs and contribute to a more resilient supply chain.

Could you elaborate on your recommendations?

[Daniel-Robert Gooch]

Thank you, Mr. Chair.

The NTCF has been a great program. Certainly, $880 million have gone to our ports through that program.

I think it's really more about where there may be gaps. One of the challenges that have been identified to us is the ability for ports—particularly smaller ports that may not have as much revenue as other ports—to maintain critical infrastructure. Sometimes it's to invest in opportunities that are available, but other times it's just to ensure that the critical infrastructure continues to be there and continues to be available.

We also want to ensure that the NTCF continues to be funded properly. It was great to see an influx of funds in the federal budget last year. We hope to see that continue on an ongoing basis, because there is a tremendous demand for these investments. The program is currently slated, we understand, to sunset around 2028. Certainly we see this as a permanent, ongoing need, so we'd like to see the fund be extended.

Another opportunity would be to look a bit more at decarbonization and whether the channels for funding within that program are sufficient to meet the needs of what our ports and other partners in the port community are trying to do to improve efficiency and contribute to Canada's climate change goals.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you.

This question goes out to anyone who has an opinion on this. I know it's a large question, but let's see what you can come up with.

What, in your view, is the single most important recommendation this committee could make in its report?

Maybe Mr. Masterson or Ms. Pasher can respond.

[Bob Masterson]

Go ahead, Ms. Pasher. You haven't had much to say. Please go ahead.

[Monette Pasher]

Thank you for the question.

I think the biggest thing we could do is to recapitalize and continue to make permanent the national trade corridors fund.

I look at the important role airports have played in the supply chain and will continue to do moving forward. Our airports have taken on $3 billion in debt, and ultimately we need to manage that debt. This is a Canada competitiveness issue, and we need our partners in the Government of Canada to help us move forward and invest in our infrastructure, which we're going to need to improve the resiliency of our supply chain.

That is probably the biggest way the government could help us move forward in our supply chain.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. Koutrakis, and thank you very much, Ms. Pasher.

Mr. Barsalou‑Duval, you have two and a half minutes.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Chair.

Mr. Masterson, earlier I started to ask a question about the idea of shortening the supply chains, but you did not get a chance to respond. I will ask again.

Could this be a good idea for the Canadian chemistry industry, in terms of securing and stabilizing the supply chains?

[Bob Masterson]

Thank you for the question.

It is complex, and it depends on what chemistries or what products you're involved with. Certainly, I think there is an effort to improve the resiliency of supply chains, and those of you in municipalities are going to see a significant demand for industrial lands that are being converted to warehousing to make sure we have.... Let's just say that it's broadly moving away from just-in-time delivery.

If you look at our chemistry industry, again, as the third-largest manufacturer, the truth is that the bulk of that activity, that $80 billion a year, is commodity exports of very resource-rich, low-carbon assets that the rest of the world doesn't have access to. We're exporting those—60 billion dollars' worth—and we're importing 60 billion dollars' worth of specialized chemicals and other comparable goods. The trade is balanced. We're sending the things that we're good at and that the rest of the world needs, and we're taking back products that typically have a lot more labour involved with them.

I don't think that's going to change, and I think the world and Canada would be harmed if there was an effort to become truly self-sufficient, this notion that we should only make the things we need. The world needs what we make, and we have a duty to get it to them, and in exchange for having all the great trade agreements that Canada has negotiated over the last few decades, we get to take advantage of the things they have that we need.

I'm cautious about saying too much, other than that there's a lot of work under way to improve resiliency, and that's largely moving away from the just-in-time delivery to more warehousing and larger inventories to take care of some of the challenges we've seen in recent months and years.

Others may feel differently.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you for your comments, Mr. Masterson.

I now have a question for Mr. Given, from the Seafarers' International Union of Canada.

Mr. Given, in the labour dispute that arose at the port of Montreal not so long ago, one of the main obstacles that complicated the situation was the issue of working hours.

In a context of supply chain problems, how could this aspect have repercussions on maintaining a certain fluidity at the ports and on adopting acceptable working hours for the workers?

[The Chair, Liberal, Peter Schiefke]

Mr. Given, unfortunately we do not have time to listen to your answer, but we invite you to share it with us in writing.

Thank you very much, Mr. Barsalou‑Duval.

Next we have Mr. Bachrach.

Mr. Bachrach, you have two and a half minutes. The floor is yours.

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

Thank you, Mr. Chair.

Thanks to all our witnesses for what we've heard today.

My last question here is about community impacts, particularly when it comes to the rail sector and rail transport, which is a top concern in the region that I represent. I know we don't have the rail sector represented among our witnesses today, but the rail mode and the marine mode are closely linked, so I think my question is probably for Mr. Gooch from the port authorities.

When we look at Canada's rail system, I think there are some key vulnerabilities, one of them being the fact that the rail lines pass through so many communities. There are so many points of tension. With increased rail traffic, we see those tensions increasing. The other one is that we built the railroad on indigenous land without permission. There are serious and outstanding issues when it comes to the relationship between the rail sector and indigenous people across the country, particularly in western Canada.

Is the federal government investing enough energy in managing those impacts? I think of municipalities here in northwest B.C. I saw that CN just turned down the idea of building a pedestrian overpass in the community of Terrace. I hear from community members in Prince Rupert, where I am today, who are concerned about noise from shunting in the rail yard. All of these concerns increase with increased traffic, so it seems that it would be a key concern for people involved in the supply chain to manage these impacts, yet we see the federal government taking a very hands-off approach to those issues when they come up.

Do you have any comments, Mr. Gooch?

[Daniel-Robert Gooch]

I don't know if I can speak to the rail situation, but I know that our ports certainly work very closely with the communities, because they understand that they have an impact on the communities. Many of our ports are right there in the heart of the urban environment. Noise, dust and other factors are a concern of the communities in which our ports are located. They have worked very closely with the communities to mitigate those impacts.

I did a tour of the port of Montreal a couple of weeks ago. I lived in Montreal for many years, and I didn't even realize that the port was right there for much of the south shore of that island. They took us out to areas where they really connect very closely to the community, where they're right up next to the community. There have been investments made into barriers to keep the sound out, and into greenery to mask the visual appearance of the port.

This is the kind of work that our port authorities are doing from coast to coast in terms of working with their communities, as well as working with their indigenous communities, the first nations, in their regions.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Bachrach, and thank you very much, Mr. Gooch.

Colleagues, given the fact that we started a little late today due to some technical issues, I'm wondering if we have consent from members to sit until approximately 1:07, just to ensure that Mr. Chahal and Ms. Gladu can ask their full range of questions. Do I have unanimous consent from all the members?

[Some hon. members]

Agreed.

[The Chair, Liberal, Peter Schiefke]

Ms. Gladu, the floor is yours. You have five minutes.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Thank you, Chair.

I want to pick up on talking about the CBSA. Sarnia—Lambton has a border, and we do hear occasionally that there are issues with not enough inspectors, too much time for an inspection or inadequate training in the ever-changing rules. Is this a consideration in terms of our supply chain resiliency?

Let's start with Mr. Gooch.

[Daniel-Robert Gooch]

CBSA is an important partner for our ports. I know that they've been called upon to adjust to rapidly evolving situations over the last couple of years. We want to ensure that there is adequate capacity for all of our ports to do their important work. That includes capacity and the systems in place at our border agency.

I'm more familiar with CBSA from my time on the airport side, where I know they were making tremendous investments into the modernization of the border from a passenger perspective. Certainly, CBSA is an organization that's not afraid of innovation, and we look forward to working with them on what they need in order to provide the service that's so important in all of the communities where that service is needed.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

I understand, then, that you're not seeing issues there.

Ms. Pasher, could you tell me about the same question with respect to airports and expanding the capacity? Do we have adequate CBSA resources? Are there issues there that the federal government should pay attention to?

[Monette Pasher]

I think Daniel touched on that. CBSA has been a great partner and a very innovative one. I think they are looking at ways we can move forward working together, working very closely with industry to digitize our borders so that we can move people through quickly. I think that will help. It will take time, obviously, and regulation tied to that.

In terms of data, I really feel we can work with CBSA and other partners to improve digitization for the supply chain. We need all partners working together. We need more transparency for our data so that we can strategize on how to improve this. We can actually operate like they do in China and in other countries. We can make it easier for trade and people who want to move goods through Canada. I think there are a lot of opportunities here, and CBSA plays a big role in that as well.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Very good.

The same question is for Ms. Edwards from the chemistry association.

[Kara Edwards]

I think some of the things we're looking for would be to publish the amendments to the transportation information regulations, to have more remedies for shippers through the CTA, and to continue on with the rail safety improvement program. We're currently using that program to help reach out to communities and to ensure that they're aware of the dangerous goods that move through their area and that they are prepared should there ever be an incident.

I think there are a lot of things being done, and they really need to continue, as well as the national trade corridors. There needs to be a continuation of the good programs that are already there, and having consistency and confidence that those are going to be there for the long term.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Thank you.

Mr. Dekovic, you mentioned that we don't have an issue with container shortages in Canada, but I continually hear about supply chain issues due to a lack of containers. What is happening there? Could you help us understand where the bottleneck is and what we need to do about it?

[Marko Dekovic]

There is no issue with container terminal capacity or shortage thereof, but as you said, there is a shortage of the physical containers that some Canadian exporters may want to use. The challenge there, as I mentioned, is the extreme consumer demand pressure of the North American market, which is resulting in ocean carriers and exporters from Asia evacuating containers to Asia more rapidly without having had a chance to go into a cycle of the supply chain here, where they may get stuff—be it somewhere in Ontario from a manufacturing facility, somewhere in western Canada with grain products or specialty crops, or British Columbia for lumber.

Because the containers, once they come off the ship, are quickly emptied, returned back to the terminal and evacuated on the next vessel out, there's a shortage of empty containers in the system. As I mentioned, however, in answer to an earlier question, we see that the imbalance is going to start settling down.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. Gladu and Mr. Dekovic.

Our last line of questions come from Mr. Chahal.

Mr. Chahal, you have five minutes. The floor is yours.