Thank you, Mr. Chair.
And thank you to the committee for the invitation to appear today regarding Bill C‑33.
I'm the Assistant Vice-President, Government Affairs, Canada, Canadian Pacific Kansas City.
On April 14, 2023, Canadian Pacific and Kansas City Southern combined to create the first and only class 1 railway network uniting North America by seamlessly connecting Canada, the United States and Mexico. The combined CPKC network allows us to offer safer, more reliable and additional competitive options for shippers, particularly now with unrivalled access to North American ports.
I will start with safety, because at CPKC everything starts with safety, every day.
Railway safety is foundational to everything we do.
In 2022, our legacy Canadian Pacific network once again led the North American rail industry in safety, achieving the lowest train accident frequency among all class 1 railroads for the 17th consecutive year, and our safety performance continues to improve.
Our 2022 train accident frequency is CP’s lowest on record. We are also achieving a stronger safety performance relative to our industry peers. In 2013—ten years ago—our legacy CP network had a train accident frequency rate that was approximately 29% below the class 1 industry average across North America. In 2022, our legacy CP network was 69% below the class 1 industry average.
In 2022, CP also achieved a 40% improvement for personal injury safety performance since 2016.
These safety results are driven by strong investment in people, processes and technology. In fact, our capital investment over the past decade, after inflation adjustment, is approximately 50% higher than it was in the decade previously.
CPKC supports the railway industry’s position that Parliament should amend Bill C-33 to include separate definitions for “safety” and “security” in the Railway Safety Act. As drafted, Bill C-33 would insert into the RSA a definition of “safety” that includes the concept of “security.” “Safety” and “security” are distinct concepts.
Security programs are designed to prevent intentional acts by individuals seeking to do harm or damage. By necessity, measures implemented to address security risks are different than those for safety, and information about them is significantly more restricted to maintain their effectiveness.
Including separate and distinct definitions for these two concepts in the RSA would be more clear, precise and accurate.
With respect to the amendments to the Canada Marine Act, we urge Parliament to amend Bill C-33 to require logistics and supply chain expertise for appointments to the boards of directors for Canada's port authorities.
Canada’s ports need to be more accountable to port users, including terminal operators, railways and vessel lines. If maximizing throughput is the goal for Canada’s supply chains, which it ought to be, then ports must be governed by boards that have deep experience and expertise with complex supply chain logistics.
The current governance structure has permitted ports to be governed by boards of directors that often lack expertise in port management, freight transportation, and business.
The lack of expertise often results in decisions that undermine the optimal efficient management of freight through Canada’s ports, which are critical elements of our supply chain infrastructure.
An example is the inefficient use of port lands, which constrains the ability of ports to accommodate growing volumes of freight. Canada’s supply chains need world-class ports. To achieve that goal, it is imperative that our ports operate in a way that optimizes and synchronizes maximum efficiency and throughput.
Improving port performance ought to be an urgent priority. The Port of Vancouver was recently ranked number 347 out of 348 on the World Bank and S&P Global's market intelligence container port performance index.
Bill C-33 as drafted is a missed opportunity to make meaningful improvements to port governance in Canada. Canada has world-class logistics and supply chain expertise. It's regrettable that this legislation does not embrace that expertise by confirming its importance through governance reform.
This is not a new concept for transportation in Canada. For example, many of Canada's airport authorities have bylaws that prescribe qualifications for appointments to their boards. Similarly, Nav Canada's bylaws prescribe specific requirements that users be appointed to a minimum number of board positions.
Parliament should seize the opportunity before it to improve the performance efficiency, reliability and throughput of Canada's ports by insisting that they be governed by boards of directors with deep supply chain expertise.
Thank you.