Transport Committee on Oct. 23rd, 2023

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

Thank you, Mr. Chair.

Thank you to all our witnesses here today for their contribution to our review of Bill C-33.

Mr. Dekovic, you talked about that continuum between government-like versus private sector market players with some government oversight.

Where do you see Bill C-33 pushing that continuum?

[Marko Dekovic]

I think it is not clear. There are some things that are moving more towards a government-centric authority, like with assessing fees, and Bill C-52, for example, is going to provide some greater transparency and oversight. There are other things that are basically allowing them to continue to have more private sector powers that are backed up by government. On some of the private sector profit-driven things that the port authority does, there are no corresponding guardrails. If you have a monopolistic quasi-private entity that also has government regulatory powers and no direct accountability to anyone, that is the challenge we've seen with some port authorities.

Again, to what was pointed out before by Ms. Gee, there are different sizes of port authorities. This is perhaps only applicable to larger port authorities. Smaller port authorities have different challenges, and perhaps that should also be looked at through this act, to actually target and revisit how port authorities are classified or even created.

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

At the beginning of this study we had some witnesses from Transport Canada. We asked the question of whether a cost analysis had been done for the various oversight bodies, the regulations that were going to be added, etc. Surprisingly, the answer was no.

As a tenant of ports, and with what you've said, does that concern you?

[Marko Dekovic]

Yes.

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

You raised the point that there are different sizes of ports. We've had witness testimony that it could be $200,000 per annum. That's what one group told us. There were a couple of additional employees from another group who told us.... You said at the outset that private companies like yours are assuming all the risks.

Do you see Bill C-33 adding to some of these burdens? Is it excessive? What's the right balance?

[Marko Dekovic]

Yes, the right balance is to be struck. I think that a cost analysis of these additional advisory bodies' oversights should be done. At the same time, additional powers that would be granted to port authorities to assess fees also need to be balanced with the kinds of powers they have and with transparency on what they do with those fees.

I think it's important to actually look at Bill C-33 in companionship with Bill C-52. It will be important to get Bill C-52 right so that the right level of transparency is provided to the tenants and the public about what port authorities do with the revenues they generate.

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

From your first read of Bill C-52, do you see that happening or are there concerns?

[Marko Dekovic]

Bill C-52 is definitely a step in the right direction. It will, for the first time, give tenants and users of the port authorities the ability to at least ask and question the increases to the fees, the sizes of the fees or what is being done. I'm sure that there will be some little tweaks when we study and dig deeper into the bill, but it's definitely a step in the right direction.

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

You talked in your opening statement, as well, about unleashing private sector investment. I think that's important if we're going to achieve what I think is the intention of supply chain fluidity and the economic potential we have. Obviously, the port of Vancouver is our gateway to Asia, and it's critically important to our economy. Maybe you could elaborate a bit more about that and where Bill C-33 may be deficient in that regard.

[Marko Dekovic]

In Bill C-33, it is not clear where it actually makes the operating environment for the private sector more cost-effective, more nimble or more predictable. Those are things that attract private sector investment, and it appears that it adds more regulatory advisory bodies, more hoops and challenges for anybody looking to invest into the gateway, more procedures, etc. It is not clear that this would be attractive to the private sector.

Furthermore, with regard to existing private sector operators, if limits to borrowing powers of port authorities are further removed, or if there is less accountability and fewer checks and balances, this will further provide a cold-water shower onto investment from the existing terminal operators because they won't know what the cost burden will be.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Dekovic.

Thank you, Mr. Muys.

Next we'll go to Mr. Iacono.

Mr. Iacono, you have five minutes.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Thank you, Mr. Chair.

I'd like to welcome all the witnesses. Thank you for all your input with respect to Bill C-33.

Ms. Gee, do you think the provisions in Bill C-33 will help the port to better manage traffic? Do you think that this will improve the overall situation with anchorages in B.C.?

[Bonnie Gee]

The ports, and the port of Vancouver specifically, are already moving forward on allocating anchorages, so there are authorities within their current letters patent that enable them to direct traffic within their jurisdiction and vessels that are due into their port as well. Data is a big part of what we need to improve our operations. Our vessels definitely want to improve the port optimization. They also definitely don't want to be sitting around waiting for cargos.

I think we're all on the right track. We're moving in the direction of getting more data to better understand where the bottlenecks are, but I don't think that Bill C-33 necessarily changes the direction that's already under way.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Does Bill C-33 change anything? Does it bring some improvements?

[Bonnie Gee]

Frankly, I don't see much in it.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Okay. Thank you.

Mr. McConchie, I have the same question for you on the provisions in Bill C-33. Will it help the port better manage its traffic and also improve the overall situation with the anchorages?

[Bruce McConchie]

It's not the case currently, and that's why we're hoping that the amendments come through.

I worked in the aviation industry for 39 years, and I'm very familiar with efficient arrival systems and especially non-efficient arrival systems. I can't understand, in this day and age, how the port of Vancouver cannot communicate with vessels that are across the ocean and schedule them in properly like an airport would do. Airports that didn't schedule properly paid the price. The ones that got their scheduling improved and expanded.... A good example is Chicago; it has excellent arrival systems. Other areas have poor arrival systems, with aircraft circling overhead burning excess amounts of fuel.

In essence, we have sort of the same thing. Unfortunately, I take a little exception to Ms. Gee's comments about ships needing to come and be checked and that taking time. Does it take weeks and months? We have to look at that kind of thing.

Bill C-33 needs to strengthen the ability of the port and demand that it improve its infrastructure, as I mentioned, with all-weather grain loading and those kinds of things.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Can you elaborate a bit more on what part it has to strengthen?

[Bruce McConchie]

Currently, as I expressed earlier, the concern is that, under the current amendment, the word “anchorage” opens the door to giving the port of Vancouver jurisdiction over the southern Gulf Islands and adjacent Vancouver Island waters.

That's a huge concern for us. It's right at the bottom of the list for efficiency currently. It needs to improve that dramatically, and we need to give the transport minister the power to demand that these things improve.

[Angelo Iacono, Liberal, Alfred-Pellan, QC]

Mr. Dekovic, as a terminal operator, can you speak to some of the challenges you face in working with the port authorities? Do you think Bill C-33 will help improve the relationships between ports and tenants?

[Marko Dekovic]

I can speak only to the one port authority where we operate, the Vancouver Fraser Port Authority. We did operate terminals in the ports of New York and New Jersey, but there is a very different approach there.

There isn't much in Bill C-33 other than perhaps that there will be a mechanism for the minister to appoint the chair, which, as I mentioned earlier, would then at least give some powers for tenants and users of the port to at least go to a political master of the port authority to ask for some remedies or at least to review our input. That is not provided right now, so that is potentially the only way that it can improve a situation where tenants, port authorities and users are maybe not collaborating or seeing eye to eye.

Historically, when terminal operators grow, port authorities grow, and there's a symbiotic, must-have relationship there. We've had some challenges and bumps along the way. I can report that, even with the recent leadership changes at the Vancouver Fraser Port Authority, we're starting to see some change in how the Canada Marine Act is interpreted by the port authority and approached with the tenants.

There's some improvement and light on the horizon.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Dekovic.

Thank you Mr. Iacono.

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

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

Thank you very much, Mr. Chair.

Mr. McConchie, I'm rather surprised to see the increased number of vessels at anchor, and I think that others have made that point previously. As you said, there were few prior to 2009 and, since 2018, that number has exploded. I'm having trouble understanding your explanation of the situation, which is the result of a lack of planning or coordination with the vessels coming into port, the handling of goods and port management. There seems to be a lack of coordination among the stakeholders involved in the process.

I wonder about efficiency. The crew is being paid, and vessels are burning fuel. A vessel that isn't moving, whether intentional or not, is unproductive. It's a vessel that isn't making money for the company. Why is this still happening? Can you answer me that?

[Bruce McConchie]

We search for the answer. To give you an example, in 2009—we have some great data, even though we're all volunteers—there were 262 total days at anchor for ships. When the interim protocols came out in 2018, there were 3,082 anchorage days. In 2022, that increased to 5,900, so the ships are arriving earlier. It supports that, because that translates into weeks for some of them, and months occasionally.

We have been pointing out and providing solutions that we think from our perspective would help. I go back to the thermal coal exports, the infrastructure improvements and supply chain improvements. As I mentioned, five years ago this month, my friend, Chris Straw, brought up those same economic issues.

When a ship is sitting at anchor, it does nothing for the Canadian economy. It's empty. People complain about the fact that they're not getting their goods and that, but, no, these are not container ships. These are empty ships arriving.

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

It's—