Transport Committee on Sept. 25th, 2025

[The Chair, Liberal, Peter Schiefke]

I call this meeting to order.

Welcome to meeting number eight of the Standing Committee on Transport, Infrastructure and Communities. Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, September 18, 2025, the committee is resuming its study of the Canada Infrastructure Bank's loan for new vessels for British Columbia Ferry Services Incorporated.

Today's meeting is taking place in a hybrid format pursuant to the Standing Orders. I'd like to take a moment to make a few comments for the benefit of our witnesses and our members.

Please wait until I recognize you by name before speaking. For those participating by video conference, please click on the microphone icon to activate your mic, and please mute yourself when you are not speaking. For those on Zoom, at the bottom of your screen you can select the appropriate channel for interpretation: floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

This is a reminder that all comments should be addressed through the chair.

Also for those joining us by video conference, I have two placards, one in yellow and one in red. If I raise the yellow one, it means that you have 15 seconds left, and I ask you kindly to wrap up your remarks. If I raise the red, it means that I will unfortunately have to cut you off mid-remarks. We try to avoid the red.

I'd like to now welcome our witnesses. For the first hour today, we have with us by video conference, from BC Ferry and Marine Workers' Union, Eric McNeely, president, and we have, from the United Steelworkers union, Marty Warren, national director, as well as Meg Gingrich, assistant to the national director.

I'd like to thank you all for being here, especially at the God-awful time that many of you are joining us locally.

We also inflict pain on our members. Today I would like to point out that it is Mr. Will Greaves' birthday. He is a member of Parliament—

[Some hon. members]

Hear, hear!

[The Chair, Liberal, Peter Schiefke]

—representing a British Columbia constituency, so he too was forced to wake up at 4:15 B.C. time.

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

On a point of order, as the chair was a member of a prominent boy band in Quebec, I believe he should sing happy birthday to Will.

[The Chair, Liberal, Peter Schiefke]

I call that out of order. That is overruled, sir.

[Some hon. members]

Oh, oh!

[The Chair, Liberal, Peter Schiefke]

Thank you very much for taking the time to appear before us today.

We'll start our opening remarks off with Mr. McNeely.

Mr. McNeely, the floor is yours. You have up to five minutes, please.

[Eric McNeely, President, BC Ferry and Marine Workers' Union]

Good morning and thank you, Mr. Chair and members of the committee.

My name is Eric McNeely. I am president of the BC Ferry and Marine Workers' Union. We represent more than 4,500 ferry workers across British Columbia, making us the largest maritime-focused union in Canada. Our members load the vessels, sail them, maintain them and repair them. We keep coastal communities connected every single day.

BC Ferries' decision to use Canada Infrastructure Bank funds to build its next four vessels overseas is really a choice about what kind of country we want to be. Do we want to keep outsourcing our industry? Do we want to be dependent on other nations to supply our domestic vessels and short sea shipping, or do we want to build a marine industry in Canada for our kids to build, load, maintain and operate vessels? Do we want to start investing in Canadian workers and Canadian communities?

When BC Ferries sends contracts offshore, we lose more than work orders. We lose apprenticeships for the next generation. We lose good, family-supporting jobs. We lose tax dollars that would circulate in our economy. Most of all, we lose shipbuilding capacity here at home. Every vessel built offshore weakens our country.

We're told it's cheaper, but when you look beyond the sticker price, the story changes. When you build offshore, you inherit offshore problems. Big ships' parts don't ship like a package from Temu. They weigh tonnes, require special handling and take weeks or months to source. Technology designed for another market isn't always compatible here. We've lived this. When BC Ferries brought in ships from Germany, we had to special-order washroom tap sensors from Europe, because North American parts wouldn't fit. When a motor failed, the repair team had to be flown in. A vessel from Greece arrived without the proper collision bulkhead and had to be rebuilt. We've also seen issues with foreign steel and proprietary systems that left us waiting on foreign suppliers for critical parts.

All of these impact service, leaving grandma waiting on the proverbial tarmac for a ferry that never comes. When passengers are left stranded, it's our members holding the bag, trying to explain why the ferry won't sail, fixing the problems and sailing behind schedule.

Each one of these so-called savings ended up costing more through delays, repairs, reputation and retrofits. These aren't isolated examples. They're part of a track record of poor planning and poor leadership, with higher costs tied directly to offshore builds. We can't keep letting this happen.

Public funds should come with requirements for Canadian material and jobs. Otherwise, we're paying for the illusion of savings while making ourselves dependent on foreign markets and builders. Canadians would never accept being flown on the cheapest airline money can buy. Our ferries are no different.

This isn't new. BC Ferries had ships built in Germany, Romania and Poland, including at yards that used North Korean labour. They have purchased used vessels from Greece. Now they are contracting with a hybrid civil-military shipyard run by the Chinese government.

Each decision further erodes our Canadian capacity. Canada is a seafaring nation, with the longest coastline in the world. Our shipyards have built fleets that helped win wars and carried goods to every corner of the world. That tradition has diminished, but it has not disappeared. We still have large players, such as Seaspan, Davie and Irving, and we still have smaller yards, such as Allied, Point Hope, Kehoe, and Ontario Shipyards, to name a few. With predictable work, these yards can keep alive the skills that Canada needs to remain a seafaring nation.

We know that this committee doesn't control BC Ferries' governance. Some would question whether anyone does, or whether it is a jurisdictional game of finger pointing with public funds at stake. But the federal government does have a role. Ottawa has a national shipbuilding strategy that covers our navy and Coast Guard. Ferries should be part of that national strategy. Ferries move millions of Canadians every year. They are no different from our highways.

Our ask is simple. When public money builds public vessels, those contracts should stay in Canada—with Canadian steel, Canadian workers and Canadian know-how. Ferry workers keep my province and our country moving every single day. They deserve ships that are safe, reliable and proudly built in Canada in Canadian shipyards, so make it right and don't let this happen again.

Thank you.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. McNeely.

We'll now go to the United Steelworkers Union. I'll turn the floor over to Marty Warren and Meg Gingrich.

The floor is yours. You have five minutes, please.

[Marty Warren, National Director, United Steelworkers Union]

Good morning, Mr. Chair and members of the committee.

My name is Marty Warren, and I'm the national director for the United Steelworkers union, and Meg Gingrich is my assistant.

Our union represents over 225,000 workers across this country. USW members make up the backbone of Canada's industrial supply chains, from resource extraction and processing to manufacturing and fabrication. Like many Canadians, our members were frustrated and disappointed to learn about the decision by BC Ferries to spend $1.2 billion on new vessels to be built in China. We were even more disappointed to learn that this purchase was supported by federal government financing. It strikes people as absurd that the country with the longest coastline in the world, a proud shipbuilding tradition and a highly skilled workforce is unable to build these ferries at home.

What makes it harder to accept is that Canadian taxpayer dollars are being used to subsidize foreign shipyards rather than to create jobs and support communities here in Canada. We must acknowledge that this debacle cannot be laid solely at the feet of the current federal and B.C. provincial governments. It is a product of a failed industrial and economic model that has been in the making for decades.

Procurement in this country has been guided by the lowest cost at any price, without regard for long-term benefits, national industrial capacity or supply chain security. The tender process for BC Ferries prioritized the cheapest bid, leaving no space for domestic content requirements or the strategic value of Canadian vessels built with Canadian steel and by Canadian workers. Our shipyards were set up to fail before they even had a chance to compete.

The reality is that markets are not truly free. Countries like China and many other trading partners have built massive overcapacity supported by subsidies, low wages and weak labour and environmental standards. No Canadian shipyard can compete on cost alone when the playing field is tilted in that way.

Canada, by contrast, has too often left our industries exposed by failing to match the protections and supports that other countries provide. Instead of treating domestic industrial capacity as a strategic priority, we've allowed it to become an afterthought, and this BC Ferries case shows the consequences.

The question before us is this: How do we prevent this from happening again? We need a clear and enforceable buy Canadian and buy clean policy. Public dollars must support Canadian jobs and communities. Every major infrastructure project financed by taxpayers should require Canadian content with binding commitments for Canadian-made products and labour. We need stronger and permanent trade enforcement to prevent dumping and to give the CBSA the resources it needs to do the job.

Finally, we need a bold Canadian industrial strategy that treats economic resilience and industrial capacity as matters of national security. This means aligning the mandates of Crown corporations so that financing is tied directly to domestic benefits. Procurement, trade, investment and innovation must all be linked under this strategy, with Canadian workers at the centre of building the infrastructure of the future.

The frustration Canadians feel is real, but if we stop there, we miss the bigger point. The real issue is that our policies allowed this to happen. The solutions are within our reach if we choose to act. Canada has the workers, the know-how and the resources to build at home. What we lack is the political will and the policy framework to make it happen.

The next billion-dollar project must not subsidize foreign competition; it must build Canadian capacity, Canadian jobs and Canadian communities.

Thank you. We look forward to any questions.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Warren.

We'll begin our line of questioning today with Dr. Lewis.

Dr. Lewis, the floor is yours. You have six minutes, please.

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

Thank you, Chair.

Thank you for being here, Mr. Warren. My first question is directed to you.

In Nanticoke, a town just a few minutes away from where I live, there is a steel mill company called Stelco that employs thousands of workers and drives our local economy. These are the same workers who are suffering and battling unjustified U.S. tariffs. A $1-billion taxpayer-funded ferry contract being handed to a Chinese state shipyard feels like a slap in the face from the Liberal Party.

Mr. Warren, could Canadian steel producers like Stelco have supplied the steel required for these ferries if these ferries had been built in Canada?

[Marty Warren]

There are definitely steel producers in Canada that can produce it. As for Nanticoke, what we call the lake operation...I'm not sure, but I know that Algoma, which is big trouble and on its knees right now—it's just so fragile in the Soo—has a history of doing it. Whatever the steel, I think most steel manufactures could do it, but to do a one-off is difficult. We need a commitment and, maybe, investment in technology to change the process so we can do it.

However, my answer to your question is, yes, that steel for those ships could have been provided by Canadian producers.

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

Thank you for that answer.

You spoke about the economic activity in your opening. Can you expand on things, including the fabrication, transport and downstream supply chains? What level of this did Canada forfeit by sending these jobs offshore?

[Marty Warren]

I think that's such an important question because it forfeited many jobs. I can't list them all. The supply chain is just as important, for argument's sake, as the steel and ship itself. There are many jobs and communities that, somewhat like the auto industry, quite frankly, have so many other links in Canada. If we do it right, then many communities and workers can benefit, from shipbuilding through to the supply chain.

Meg, I don't know whether you want to comment on that.

[Meg Gingrich, Assistant to the National Director, United Steelworkers Union]

No. I think that's essentially it. We lose out on those jobs. That's the importance of having a bold industrial strategy so we're not going to lose out on these because we lost that capacity or hadn't maintained or built it. It needs to be brought into that larger capacity, looking beyond just defence to commercial ships, ferries and things like that as well.

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

It's fair to say that Canada lost thousands of unionized jobs for the steelworkers who would have been related to this contract. Given that some of your union members paid the taxes that went to this billion-dollar contract that was doled out by the CIB—which the Liberal Party did not intervene to stop—do you believe that BC Ferries and the CIB could have structured the loan procurement rules to require Canadian steel content and Canadian jobs, ensuring that domestic jobs and industrial capacity were supported rather than going to our competitors?

[Marty Warren]

Yes, I think that is exactly what could and should have been done.

To your original point, when we just race to the bottom for the cheapest price, what we really lose is the taxpayer base. A lot of these jobs are good jobs—raise a family, perhaps own a home, retire in dignity—and when that work isn't provided to Canadians, we lose the tax base for hospitals, education and infrastructure. As we move forward, you have to look at more than the bottom line.

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

It's not just this generation that's losing. This is the loss of generational capacity and the opportunity to strengthen our industry and shipbuilding industry. This opportunity was effectively handed to the Chinese-owned shipyard. Can you speak about the loss of generational capacity?

[Marty Warren]

Absolutely...and I think Eric McNeely mentioned it too. It's generational, especially in the steel industry with many generations in it. In many industrial sectors, whether it be mining or other sectors, it's passed down. It's generational. Again, in this here economy, and with the tariff threat, it's so important we do everything for our future generations. One of the first steps we can take is protecting our domestic market and creating a domestic market where we don't have it. The biggest point Eric made, I believe, and even Meg made, is that, when these skills and industries leave, most of them won't come back. We lose that for generations to come.

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

That's very sad for Canada.

We have an infrastructure bank in Canada. Section 3 mandates and requires that investments generate social and economic benefits for Canadians. In your opinion, with a billion-dollar taxpayer-funded loan to China for these ferries that excludes Canadian workers and benefits, would you say that mandate was reached in providing economic and social benefits to Canada?

[Marty Warren]

It was a complete failure. What could have been done and set up, not only for the first two to four ships—there are another 14 coming—is that we could have invested in the infrastructure where we lacked it to do it ourselves and provided good-paying jobs for our tax base and our communities. It was a debacle, and, as I said, a failure.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Dr. Lewis.

Thank you, Mr. Warren.

Next we have Mr. Kelloway.

Mr. Kelloway, the floor is yours. You have six minutes.

[Mike Kelloway, Liberal, Sydney—Glace Bay, NS]

Thanks, Mr. Chair.

Thanks to the witnesses for being here, given the time it is in B.C. It's really important to just comment for a second. It's great to see the unions here. I grew up in a union house, a UMW house. My father was a coal miner for 40 years. We were raised in a union environment, a union family, and it provided us with a great deal.

I want to start off with Mr. McNeely .

During your opening remarks you talked about the importance of the national shipbuilding program, the procurement process and what that's done for Seaspan and jobs in B.C. and in the supply chain. Also in Quebec and in my home area.... It's four and a half hours away to Halifax, but the impacts are felt in Cape Breton in terms of jobs and the supply chain. When we're talking about this particular item, around BC Ferries, it's a provincial Crown corporation and provincial procurement process, but from your experience, sir, what things can perhaps the provincial government, the Crown corporation, BC Ferries, learn from the procurement process federally?

If you look at the investments that were made across the country from coast to coast, they were substantial and the impact was good-paying jobs across the board in every conceivable trade through the supply chain. I'm wondering: What did we learn federally that the provincial Crown corporation can learn, not tomorrow but today, in terms of their procurement process?

You're right. I think it was Mr. Warren who said we need to prevent this from happening from a provincial standpoint. What can we be doing to learn from the federal side?

[Eric McNeely]

Thank you for the question.

In terms of procurement and what we can learn from it, if this process is started or concluded in a more timely fashion.... The original plan began seven years ago. If those steps had been taken in a timely way, we wouldn't be sitting here waiting 30 years for new vessels and now in a situation where we're being told we can't wait. It's because no one planned for us to be ready.

It's not an excuse to keep offshoring. It's a sign that we need a real shipbuilding strategy that works for British Columbians, that works for Canadians. BC Ferries started planning these vessel replacements over seven years ago. There was plenty of time to work with Canadian yards. There was plenty of time to work with the Canada Infrastructure Bank. Fundamentally, because the process was so protracted, there are now questions about capacity at this moment, but there would have been time if this procurement process had been more thoughtful and more timely.