Evidence of meeting #19 for Transport, Infrastructure and Communities in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was airports.
A recording is available from Parliament.
Senior Director, Transportation, Infrastructure and Regulatory Policy, Canadian Chamber of Commerce
Do you want me to go first?
Senior Director, Transportation, Infrastructure and Regulatory Policy, Canadian Chamber of Commerce
I think we realize that there's a fair bit of regulation. Right now, we need to take the opportunity to really take a step back and review what regulations we have in place and how we can be more competitive.
Liberal
Executive Vice-President, Pascan Inc.
Thank you for your question.
We were very lucky in Quebec, because at the beginning of the pandemic, the provincial government introduced a program to assist regional carriers called the Programme d'aide pour le maintien des services aériens régionaux essentiels en période d'urgence sanitaire. This helped us provide basic air service in some areas. Quite frankly, without that assistance program, I'm not sure we would be here talking about it today. It's a very good initiative. When we compare ourselves to the rest of the world and other parts of Canada, we feel very fortunate.
The approach in most other countries has been to introduce programs for the major airlines, anticipating that this support would have a spillover effect on regional carriers, which has not necessarily been the case in most countries.
In the United States, it's not at all the same in terms of the number of people to be served. It's also not the same from one province to another in Canada. In Quebec, at Pascan Aviation, we serve small communities of 10,000 to 15,000 people. Air transport is very different in Alberta, for example, which has connections between Edmonton and Calgary. Airlines serve 300,000 people, even 1 million people in the Calgary metropolitan area.
We don't face the same issues. We're very apprehensive about our future. As my colleague Julian Roberts said, the pilot shortage may be our biggest problem.
Liberal
Angelo Iacono Liberal Alfred-Pellan, QC
Thank you.
My next question is for Mr. Guy once again.
Are you seeing an uptick in passenger volume? How does it compare to your projections? What were your estimates last year, for example?
Senior Director, Transportation, Infrastructure and Regulatory Policy, Canadian Chamber of Commerce
When looking to the future, we see that airports are economic generators. How do we get people travelling faster? It's figuring out how we put Canada one step ahead of the competition. It's looking at ways in which Canada can be innovative and attract people to the country. It's making the electronic travel authorities easier to obtain and expanding to countries of strategic importance.
That would be my quick comment.
Liberal
Angelo Iacono Liberal Alfred-Pellan, QC
Thank you.
My next question is for Mr. Sparling.
Mr. Sparling, what are the key lessons you've learned from the pandemic?
President, Air North
I think what our region learned, what northern regions learned, is that air transportation is not a luxury but rather a necessity.
The first thing we did when COVID hit was cut back our schedules. Within a week, we heard from the government, “My gosh, we need more service. We have medical supplies to move. We have medical travellers to move.” We added back service, even though it wasn't paying its way. Much like the situation in Quebec, we were also very fortunate that the government recognized the essential nature of air transportation, particularly in remote regions. I think that's a lesson Canada can learn going forward. We're not like more populous regions where there are very large volumes of traffic.
Air transportation in Canada is almost like a public utility, particularly in remote regions, and I think we have to treat it as such. We don't have toll highways in general in Canada. That's regarded as infrastructure that's for the general good of Canadians, and it's funded out of general revenues. I think air transportation and air transportation infrastructure should be funded in a similar manner so that all Canadians have an ability to travel seamlessly and affordably between any cities in Canada and all Canadians have access to major centres in the south and, in fact, to the rest of the world.
As has been expressed before, aviation is an economic enabler. I think that's a lesson we learned from COVID. If we knew it before, it maybe wasn't top in our minds, but I think that COVID has perhaps elevated the importance of aviation.
Liberal
The Chair Liberal Peter Schiefke
Thank you very much, Mr. Iacono.
We will now welcome Ms. Sinclair‑Desgagné.
Ms. Sinclair‑Desgagné, thank you so much for being here.
I've just learned that Mr. Barsalou‑Duval will not be attending the meeting. Therefore, you have the floor for six minutes.
Nathalie Sinclair-Desgagné
Thank you very much, Mr. Chair.
I'd like to greet my colleagues, to whom I am a face.
I'd like to thank all the witnesses attending the committee meeting today.
The past two years have certainly been difficult due to the pandemic. You have all expressed that in different ways, but you all have one feeling in common. I liked the way Mr. Sparling summed it up: Air travel is not a luxury, it is a necessity, especially when it comes to regional transportation. The Bloc Québécois shares this view. Regional transportation is certainly very important to us, because we'd like remote communities to have air service.
I have a question for Mr. Roberts or Mr. Gagnon, depending on who would like to answer. During the pandemic, Air Canada cut several of its regional routes. Given that we're seeing some recovery now, in your opinion, is there any likelihood that Air Canada might take up those routes again? How do you feel about that competition?
Executive Vice-President, Pascan Inc.
Thank you for your question.
Air Canada serves the whole country, not only Quebec. People will recall that at the beginning of the pandemic, Air Canada significantly reduced its regional service. In Quebec, most regions were dropped, with the exception of the Rouyn‑Noranda, Bagotville and Sept‑Îles.
At the same time, it should be noted that Air Canada has taken advantage of the situation to sign interline agreements with other airlines, including Pascan Aviation. As a result, regional Quebecers no longer served by Air Canada can still take international flights from the Quebec City and Montreal airports. I know that Air Canada has also signed similar agreements with other airlines in Canada. We don't believe, at least for the Quebec market, that the regions are being left behind. On the contrary, we're seeing even more competition with other regional carriers.
Nathalie Sinclair-Desgagné
Excellent. Thank you.
Do you feel this kind of alliance is one of the solutions for better serving the regions?
Executive Vice-President, Pascan Inc.
In my view, it's the way forward.
Like I said earlier, Quebec is made up of little market pockets. It can't have three or four operators serving 10,000 residents. We have to see how each carrier can optimize its network to offer a more affordable service. People often say that if we see more competition, better prices will follow, but that's not necessarily the way we see it. When it comes to competition, the bigger fish kill the smaller ones. So they get a monopoly, and prices go back up.
Nathalie Sinclair-Desgagné
Very good.
We could not agree more.
In this case, if Air Canada had a monopoly in the regions or a competitive advantage, it would certainly not be good news for the smaller airlines.
Is there anything the government can do to foster this kind of alliance?
Executive Vice-President, Pascan Inc.
I will let my colleague Mr. Roberts answer that question.
President and Chief Executive Officer, Pascan Inc.
Good morning.
Basically, you'd like to know whether the government can help improve service between smaller carriers to connect with Air Canada. Is that right?
Nathalie Sinclair-Desgagné
My question was in response to Mr. Gagnon's answer.
Is there anything the government can do to contribute to this kind of win-win alliance that's good for Air Canada, the major carriers, smaller carriers and, most importantly, regional service?
President and Chief Executive Officer, Pascan Inc.
Yes, there sure is.
I've been in the Quebec regional aviation business for 26 years. I've seen a number of companies come and go as soon as a major player entered the picture. The major carriers would lower their prices to drive the smaller carriers out of business. This went on for years and years, at least since I began my career in 1998.
Today, the small carriers in Quebec have learned some lessons from the past. They're a little smarter now. The fact that they have access to carriers like Air Canada and that PASCAN signed an interline agreement with Air Transat will give people in the regions choices they didn't have before.
Before the pandemic, if someone wanted to fly from Sept‑Îles, they had to go to Montreal to catch an Air Canada flight. This year, a passenger from Sept‑Îles can take a PASCAN flight to Quebec City or Dorval. Then they can choose to take an Air Canada or Air Transat flight. Quebec passengers now have more choices.
The government can help by ensuring that these interline agreements exist. It's an obligation for Air Canada—
Liberal
The Chair Liberal Peter Schiefke
Thank you very much, Mr. Roberts and Ms. Sinclair‑Desgagné.
Next we have Mr. Bachrach.
The floor is yours. You have six minutes.
NDP
Taylor Bachrach NDP Skeena—Bulkley Valley, BC
Thank you, Mr. Chair.
Thank you to all of our witnesses for their testimony so far. This is going to be an interesting study.
I'll start with Ms. Pasher.
Hearing the testimony from a number of witnesses, it sounds like airports in Canada are a net revenue centre for the government. Is that a fair characterization? Is the government taking in more revenue from airports than it's investing in those operations?
Interim President, Canadian Airports Council
Yes, absolutely.
Prepandemic, airports were contributing over $400 million in rent to the federal government and only a small portion is coming back to airports through the airports capital assistance program, which is funded at $38 million a year. There are other infrastructure programs that happen from time to time. Right now, there is the national trade corridors fund, and there have been different infrastructure stimulus funds that are fifty-fifty with airports and the government.
Overall, airports are contributing, in a good year, much more to the government than they're getting back through the system.