Mr. Speaker, it is a pleasure for me to take part in this debate on Bill C-66, an act to amend the Western Grain Transportation Act.
As the Minister of Agriculture and Agri-Food has already indicated, this bill covers short term amendments aimed at addressing inefficiencies that have been identified in our grain transportation and handling system.
Specifically, Bill C-66 would authorize the railways to implement demurrage, car storage charges, and despatch. It would also eliminate the WGTA subsidy on grain movement to Mexico and end the practice of routing U.S. bound grain to Thunder Bay and backhauling it to Fort Frances or Winnipeg before finally sending it into the United States.
Until now the railways' inability to levy demurrage charges or car storage charges has led to the use of rail cars for storage purposes, as was just stated by the member across the floor. It obviously reduces the efficiency and effectiveness of the grain car fleet. We do not know where our cars are. They are all over the place. They could be in the United States. They could be anywhere. We end up putting more cars into the system.
As a result, we need more cars to move our grain than what we should need. The backtracking practice has evolved because it is cheaper for a shipper to send U.S. bound grain to Thunder Bay in order to qualify for the WGTA subsidy and then backhaul it to Fort Frances or Winnipeg before it is moved at commercial rates to destinations in the United States than it would be to ship it directly at commercial rates.
Using Winnipeg as a reference point, this practice increases the length of grain haul by about 450 miles over CN lines and about 860 miles over CP tracks. This practice is clearly inefficient and results in longer car cycle times and less effective use of the grain car fleet. In the 1993-94 crop year, 1.1 million tonnes of grain were shipped to the U.S. via this scenic route.
Regarding the removal of the WGTA subsidy on wheat shipments to Mexico, we expect that the amendments in this bill will resolve the current countervailing duty investigation in Mexico and ensure our continued access to an important market for Canada.
It is important to note that these proposed changes are short term amendments only. They are not intended to replace comprehensive reform of the WGTA. I should also point out that they have received widespread industry support.
In fact, these changes were suggested by and have support in principle from the subcommittees of the House standing committees on transportation and agriculture and agri-food, as well as the May 16 group which includes representatives from grain companies, the railways, labour and management.
Both of those forums have suggested a number of initiatives to reduce inefficiencies, improve the capability of the grain transportation and handling system and facilitate the movement of grain to markets. Many of their suggestions have been implemented. However, some of the proposed changes require legislation, hence the bill we are debating here today.
The government would like to proceed with these short term amendments now in order to eliminate the subsidy on wheat to Mexico as soon as possible and to ensure that demurrage and backtracking issues are dealt with before the 1995-96 crop year which begins August 1, 1995.
As I indicated earlier, there was agreement in principle to eliminate these inefficient practices. After further consultations, a consensus emerged among the May 16 group that the WGTA amendments should take effect at the beginning of the crop year. The group favoured this timing because it would allow time for grain marketers and shippers to adjust sales and supply programs accordingly.
It is important to note that although August 1 has been selected as the implementation date for some of these changes, the amendments dealing with demurrage, storage charges and despatch as well as backtracking could be implemented earlier if the government is satisfied that there is sufficient agreement
between the railways and the shippers on the commercial details of the changes.
I would like to make it clear that this proposed legislation in no way lessens this government's commitment to making decisions on broader WGTA reform in the near future. The passage of this legislation will enable the government to continue with the consultations that are so vital to the development of the long term solutions for problems in our grain handling system. At the same time, it will address the immediate problems which members of government and industry representing the grain companies, the railways, labour and management have identified.
Members of the House, I ask for your support in the rapid passage of this legislation. The measures proposed by Bill C-66 will help make Canada's grain transportation more efficient and better able to meet the needs of our customers around the world.
