Transport Committee on Oct. 8th, 2024

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

You also mentioned that CTA charges need regular review. Can you elaborate on what types of charges?

You spoke about external taxes and buried fees. Can you elaborate on and list the types of fees that your airline pays? For example, what are the airport fees that are added to the fare? What are the landing fees, the terminal fees, etc.?

[Douglas McCrea]

Well, there's the common fee, which is the AIF. If airports actually charge it as an AIF, it displays on the ticket. It's in full view of the person buying the ticket.

There are lots of buried fees. There's a fee they call the passenger facility charge, which doesn't show on the ticket. Airports charge that directly to the airline. Buried fees like that don't show necessarily on the day-to-day...or are not in the public's view.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

Can you tell me what percentage of the fees make up the fare?

[Douglas McCrea]

I cannot, at this point. I could figure it out and get it to you in the future.

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

That would be helpful, if you could undertake to do that.

My next question is for Mr. McCain.

Mr. McCain, you stated that you have a unique business that deals with charter.... You also stated that you work with the oil, gas and mining...and food retailers.

Now, we heard from earlier witnesses about the cost of living. We heard about the food crisis in the north. We've also heard that the cost of transportation in the north is increasing at such an exponential rate that not even nutrition north, a food program that was set up to deal with affordability of food in the north, can offset these inflationary costs.

Can you elaborate on how all of the hidden costs and the red tape in your industry have to be transferred to the food industry, as outlined by a prior witness?

[Myles Cane]

I'm assuming you're referring to me. It's Myles Cane.

Is that the witness you'd like to answer the question?

[Leslyn Lewis, Conservative, Haldimand—Norfolk, ON]

Yes.

[Myles Cane]

Okay.

Yes, we are a charter airline. We have several contracts with food companies across the Arctic. Any of our elevated costs must be passed on to our customers, who in turn pass on their elevated costs to their clients, who are buying the groceries.

There are many examples of how our increased costs have to be passed on. One example is the carbon tax. Another example is the flight and duty regulation changes, which were not actually based on any science but were bearing a slavish devotion to adhering to EASA regulations, basically. EASA, of course, is a network that is largely connected by road, where foodstuffs are not regularly flown unless they're gourmet, shellfish or seafood, whereas in our jurisdiction, Yellowknife is the end of the road, and there are 56 communities north of here that require all of their fresh foodstuffs to be flown in.

If you want to apply a number to the cost of the flight and duty regulations, I think most airlines had to increase their pilot workforce by 20%.

I see a red card.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Cane, and thank you, Dr. Lewis.

Next, we'll go to Mr. Hanley.

The floor is yours for five minutes, please.

[Brendan Hanley, Liberal, Yukon, YT]

Thanks to all three of you for this really interesting testimony.

I want to start with Mr. McCrea. You specifically brought up interline agreements, which is certainly an area of interest and actually was one of the key motivations for me to ask for this study to proceed, given the importance and the potential that it brings for northern carriers.

I'm going to reflect how Joe Sparling, the CEO of Air North, described it in his testimony in May:

Mandatory interline and code-share agreements...would serve to level the playing field between small regional carriers and large network carriers by providing regional carriers with access to mainline networks and thus 100% of the market rather than just a portion of the market.

He reflected that this has already been achieved in other industries, such as telecommunications and railroads. There are parallels already.

Could you reflect on how government can facilitate interline agreements? What do you see as the pathway?

[Douglas McCrea]

I believe it needs a bit of a push. At this point in time, it's certainly up to the discretion of both companies to enter into an interline agreement. I agree with Joe's comments that, at the end of the day, it opens up the playing field. It certainly would allow the travelling public to more or less see the world on one ticket rather than on multiple travel itineraries with different airlines. If both players came to the party, we would see a combination of the fare, which would be more pleasing to the passengers as well.

That's what I'd suggest.

[Brendan Hanley, Liberal, Yukon, YT]

Thank you. That's very helpful.

Mr. Pyle, does this apply to any of your companies? Is this an area of interest for you?

[Michael Pyle]

I don't think there's any downside to facilitating these processes, and we're in discussions about that on a regular basis. However, in our business, most of what we're servicing are indigenous and first nations communities across the north, and about 90% of those would be attending a southern centre, whether it be for medical appointments, shopping or those kinds of things. Very few of our passengers would follow through into tourist or vacation travel. There are some who may travel, say, down from Rankin Inlet to Winnipeg and then across to Toronto for government meetings or those kinds of things. In that case, it would be helpful.

It's more the convenience factor, I think, than the absolute price factor, because they could check their luggage. They don't have to worry if one flight's delayed, because the other automatically looks after it, so there's definitely a benefit to it. I would agree with that.

I don't think it's a huge part of our business, however.

[Brendan Hanley, Liberal, Yukon, YT]

Thank you.

To continue with you, Mr. Pyle, I was curious that you mentioned the importance of partnerships, at least with some of the indigenous companies under your umbrella. Could you tell me a bit about what advantages that might bring and how they may be facilitated or further facilitated?

[Michael Pyle]

We have different forms of agreement in different parts of the country. We have some areas in Labrador and northwestern Ontario in particular where we actually own the airline with first nations, so we're the operator and they're an equity partner.

In other places, like Manitoba or Nunavut, we actually have community partnership agreements whereby we share some of the benefits of the airline service, whether it be providing free tickets to the community, economic development assistance on certain projects, bereavement charters and those kinds of things, and we put money back into the communities we serve. In my business in particular, we're largely looking after indigenous people, so the opportunities to put money back in are huge.

I'd like to point out one other where we have tried to cultivate indigenous pilots. We own a flight school in the Maritimes, and we tried to get indigenous pilots to the flight school. They struggled culturally, being that far away from home, so in the last two years we've opened up flight schools in three communities where we provide free pilot training to people in the hopes of developing first nations pilots to reduce the pilot shortage and provide pilots to the communities who understand the culture in those communities.

As it relates to northern Canada, the indigenous part of the business is very important.

[Brendan Hanley, Liberal, Yukon, YT]

Thank you.

I guess I don't really have time for another question.

[The Chair, Liberal, Peter Schiefke]

Mr. Barsalou‑Duval, you have the floor for six minutes.

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

Thank you, Mr. Chair.

Thank you to the witnesses for being with us today.

My first questions are for Myles Cane, from Summit Air.

I would like to respond to your opening remarks. You talked a lot about the relationship between airlines and officials, or at least those who create the new regulations. Your comments reminded me of what other witnesses have told the committee so far. Many airline representatives, at least those in remote and northern regions, feel that decisions are made by public servants in Ottawa without taking their reality into account, and they suffer the consequences.

Could you explain to us how that relationship is going? How are you consulted before Ottawa puts in place new regulations that could have an impact on your activities? What does that dialogue look like? Are they still—

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

Excuse me, Mr. Chair.

We haven't had interpretation for a while now. There's no English.

Start again from the top.

[Voices]

Oh, oh!

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

Is it working now?

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

Yes, it is working.

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

I don't know where they want me to start over.

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

I would say from the beginning, but I think we understood.

[The Chair, Liberal, Peter Schiefke]

You have five minutes left, Mr. Barsalou‑Duval.