Transport Committee on Sept. 20th, 2023

[The Chair, Liberal, Peter Schiefke]

You have 30 seconds left, Mr. Bachrach.

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

Perhaps I'll ask my question and then wait until a future round to hear the answer.

A lot of the concern is around the difference between a public procurement model and these P3 models that this Liberal government seems so entranced by. Of course, here in Ottawa, residents have had some pretty tumultuous experiences with the P3 model. I would read this quote from the Ottawa LRT inquiry, which noted that “the P3 model caused or contributed to several of the ongoing difficulties on the project.”

I'm wondering how the experience of the LRT could relate to what we're talking about with this HFR project. I'll leave the answer for the next round.

Thank you, Mr. Chair, for your indulgence.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Bachrach.

Next we have Mr. Muys.

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

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

Thank you, Mr. Chair.

Thank you to the witnesses for their time, including those who are online.

Just for a bit of context, I know that you're representing Via HFR and not Via, but maybe you have some knowledge—I hope—of the marketplace. I want to understand a bit more of the business case.

My constituency is in Hamilton. Next door to us in Brantford, train 82, which went from Brantford into Union Station in Toronto, was just recently reinstated.

There were a number of trains that fed into the Toronto GTA hub and that, hopefully, would connect to future HFR or other such train services. They were paused during the pandemic and have only just begun to be reinstated: Kitchener, London and Barrie. What is the marketplace in the feeder routes into Toronto? Do you know?

[Martin Imbleau]

I personally wouldn't know exactly what the business case is and the number of passengers and the economics specifically for that region. Maybe my colleague can comment on it, but I, unfortunately, wouldn't have that input today.

[Marc-Olivier Ranger, Corporate Secretary, VIA HFR – VIA TGF Inc.]

The Department of Transport will also come to testify. I would politely ask that you redirect the question to them because there are some studies around trends outside of the corridor. Our mandate is pretty restricted to the corridor, but there are some more—

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

Right, but it doesn't operate in a vacuum.

Okay, I'll put that aside, then.

You talked about, of course, the different model being fast and on time. Have there been any sorts of studies in terms of the percentage of anticipated uptick in ridership as a result of that versus the existing service?

[Martin Imbleau]

Yes, because of the improvement of the system and the dedicated-track aspect, we think that passenger usage will jump significantly—today it's around four million—to 17 million by mid-century. It's a huge increase with a significant reduction of the GHGs emitted by individual cars as a side effect.

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

Is there a range or an estimate of how many riders on an annual basis need to be taking this service in order to make it a go? What year in the years of operation do we reach before we get to the point of breaking even?

[Martin Imbleau]

Breaking even is probably not the right approach. It's like thinking about when a highway will meet its break-even point. It basically does not happen because large infrastructure like this is not developed by government for nothing. It needs significant involvement from the government. There's a large part of it that will come from funds from the government, and our job is to keep it as low as possible and ensure that we have the right balance with the private partner to make a service that is affordable.

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

Do we know how many riders...? I mean you talked about four million to 17 million.

[Martin Imbleau]

Do you mean how many it would take to make it economic if it was completely independent? We haven't made that economic...because it's probably a moot point. It's something that has to be supported by federal subsidies, for sure. There's no doubt about it. Just like a highway, how much depends on the usage, which we will refine during the codevelopment process, and we'll be happy to share it at that point in time.

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

Mr. Hampshire, I read your background, and you have, of course, quite a level of expertise in different train services in Europe and other places in the world. What do you see as the potential and the pitfalls going into this?

[Graeme Hampshire, Project Director, VIA HFR – VIA TGF Inc.]

I think one needs a balanced approach here. One needs to take the best of the public sector that we've seen in Europe and the best of the private sector. I don't quite share the doomsday scenario presented by my colleague on the left concerning U.K. rail because I was involved in that for a number of years. There were significant benefits from involving the private sector. The model has now moved on. The model has matured, and we can learn lessons from that, I think.

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

Mr. Johnson, you cited the $71 million, if I'm remembering this correctly, that was wasted up front. Can you break that down? Maybe you did, and I missed it. What was that $71 million composed of then and, therefore, what is your concern about cost overruns going forward and where those are going to be borne? You said that the taxpayers and the riders are going to bear this cost.

[Terence Johnson]

The most important point is that, even before the joint project office was created, the ridership forecast existed. The business plan existed. The infrastructure assessment existed. All of those things had already been paid for by Via Rail Canada. All that money had already been spent. The only thing we haven't done with that is publish it to have the transparency to share with the public the real details to back up the assertion that, yes, this thing is actually getting to carry 12 million or 17 million passengers, and here's the model that shows where this is going and what our assumptions are about how our cities might grow and all the other public policy parts of this. All of that already existed before the joint project office was created.

The joint project office was supposed to do things like secure land. It hasn't done that. There have been so many missteps. The Mount Royal Tunnel was let go. All of these kinds of things that the money should have done, it didn't do.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Johnson.

Thank you very much, Mr. Muys.

Ms. Koutrakis, the floor is yours for five minutes.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you very much, Mr. Chair.

Thanks as well to our witnesses for being with us this evening.

Mr. Imbleau, congratulations on your appointment to this new position, and thank you very much for the services you've previously rendered to the Port of Montreal. It's a genuine pleasure to see you again. I'll begin with a few questions.

First, would you please explain why the high-frequency train is being designed as a public-private partnership. Second, does the Government of Canada have the necessary expertise to carry out such a complex civil engineering project? Third, what's your response to our NDP friends who say that a public-private partnership can only increase project costs?

[Martin Imbleau]

Thank you, Ms. Koutrakis. It's nice to see you again.

In a way, I think we have the best of both worlds in this instance. If this project were completely handed over to the private sector, without the supervision of a well-informed office staffed by a good team, we'd be, in a way, navigating in the dark. On the other hand, it would also be difficult to develop such a complex civil, technological and electrical project solely within government because we probably wouldn't have access to innovations and new techniques that are out there, such as technologies and construction techniques, as well as competition among various firms.

Consequently, we probably have an appropriate balance between the two here. I don't think it'll cost more because we're operating within a public-private partnership. Costs are costs: management alters the actual cost situation, and capital cost tips the balance somewhat, but it's the model itself that will essentially be the decisive factor regarding costs in this case.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you.

I know the final route hasn't been determined yet. What are the various factors that will have to be considered in deciding it?

I've received a lot of questions from Mr. Boyer, the mayor of Laval, a city situated in my constituency. He asks me, every time I see him, if there'll be a station in Laval.

[Martin Imbleau]

It's a legitimate question. Obviously, everyone would like to have a station, and the fastest train possible too.

Many factors have to be considered, and I discussed this with the team this morning. They include distance, number of stations and population density. Geography is also a significant factor, if only for determining curve radius. There's also track-sharing, distance and ways of circumventing certain obstacles, such as Mount Royal, which we referred to earlier.

It's really something that involves many factors. So decisions will be made based on the service offered, the environment and costs so we can provide the best possible service at the lowest cost.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you.

Mr. Massicotte, many Quebec stakeholders are calling for a high-speed train. Who do you think should pay the higher costs that would be associated with that? Do you think the Quebec government or the Municipality of Trois‑Rivières would be prepared to contribute to those higher costs? If so, to what extent? Has that been discussed within your organization?

[Patrick Massicotte]

Thank you for asking that question. The debate in Quebec over high-speed trains versus high-frequency trains has resumed with renewed vigour.

As I mentioned a little earlier, I think a hybrid system might be the optimal scenario. There could be high-speed trains on certain routes and high-frequency trains on others, but I'm not an expert in the matter.

As for associated costs, you have to understand that we're making these investments in order to be internationally competitive. Connectivity among the regions and major urban centres will promote regional and economic development quite significantly. When I mention the innovation zone, the battery industry, in particular, I believe you're aware of all the investments that General Motors, POSCO, Ford and others have made. Many industrial concerns are setting up in our region. Having a foundational network will foster the emergence of businesses and revitalize the economy for all Canadians.

Regarding your question as to whether the City of Trois‑Rivières is prepared to make significant investments, I don't want to speak on behalf of the city. We also haven't focused specifically on that point.

I hope that answers your questions.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Massicotte and Ms. Koutrakis.

Mr. Barsalou‑Duval, the floor is yours for two and a half minutes.

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

Mr. Massicotte, welcome and thank you for being with us.

You've spoken at length about the fact that it would be a good for Trois‑Rivières if the train stopped there. We obviously agree with you. René Villemure, one of our party members, constantly tells us in caucus how important he thinks it would be to have a station in Trois‑Rivières.

However, any city on the route could say it would like to have a station. Why would Trois‑Rivières be an essential stop? Not all the people around this table are from Quebec, and they aren't all necessarily familiar with Trois‑Rivières. Perhaps it might be a good idea to explain a little why it's important for there to be a station in Trois‑Rivières.