House of Commons Hansard #21 of the 35th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was railway.


Government Response To PetitionsRoutine Proceedings

10 a.m.

Winnipeg North Manitoba


Rey D. Pagtakhan LiberalParliamentary Secretary to Prime Minister

Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to petitions presented during the first session.

PetitionsRoutine Proceedings

10 a.m.


Bill Gilmour Reform Comox—Alberni, BC

Mr. Speaker, pursuant to Standing Order 36, I am pleased to present a petition from constituents on Vancouver Island which contains over 1,000 signatures.

The petitioners request that Parliament not increase the federal excise tax on gasoline.

Questions On The Order PaperRoutine Proceedings

10 a.m.

Winnipeg North Manitoba


Rey D. Pagtakhan LiberalParliamentary Secretary to Prime Minister

Mr. Speaker, I ask that all questions be allowed to stand.

Questions On The Order PaperRoutine Proceedings

10 a.m.

The Deputy Speaker

Is that agreed?

Questions On The Order PaperRoutine Proceedings

10 a.m.

Some hon. members


Canada Transportation ActGovernment Orders

10 a.m.

Victoria B.C.


David Anderson LiberalMinister of Transport

moved that Bill C-14, an act to continue the National Transportation Agency as the Canadian Transportation Agency, to consolidate and revise the National Transportation Act, 1987 and the Railway Act and to amend other acts as a consequence, be read the third time and passed.

Mr. Speaker, I rise today at third reading of Bill C-14, the proposed Canada Transportation Act. This is an important bill. It introduces new framework legislation that touches every transportation mode. It represents the culmination of several years of effort on the part of the Department of Transport.

It has been at times, as all hon. members know well, a controversial bill. One of the first tasks that I set myself this year as the newly appointed Minister of Transport was to review the proposed legislation and assess for myself whether or not an appropriate balance had been achieved between the varied interests that are affected by the elements of the bill.

After careful consideration and an analysis of the bill, I have concluded that it is a balanced piece of work. It clearly reflects the hours of consultation and careful analysis that have been invested in it over the past few years.

On that basis, I am very pleased to move this bill forward today. It is an act which will truly bring the Canadian transportation industry into the 21st century.

I think it is also important to set this bill in a broader context. It really lies within the scope of our government's policy strategy, which is to streamline and modernize our transportation industry.

Given the importance of transportation in the Canadian economy and for Canada's competitiveness on the world markets, this bill will enhance the nature of trade, viability and competitiveness of transportation.

In drafting this bill, the government took into consideration reports from independent commissions, previous work of the Standing Committee on Transport and the report produced by a task force on marketing headed by the hon. member for Kenora-Rainy River, whom I wish to thank for his great work.

To develop Bill C-14, the government asked itself what those concerned could and should do on the market, which issues would better be left in the hands of the regulatory body and which should be debated by elected representatives.

The opinions weighed as part of this process were many and varied. Finally, the government decided on what it felt should be a new balance, a balance between regulatory protection and trade negotiation as well as between supervising an agency and giving transportation companies more freedom in managing their own business.

Over the summer, the government heard from many stakeholders, who were concerned about certain aspects of the bill. Recognizing that any legislative enactment can always be improved on, it identified several potential changes.

Then, the Standing Committee on Transport carried out an exhaustive review of the bill. It also heard evidence from many stakeholders at this stage. Nearly 100 testimonies were submitted, and I understand that an even large number of briefs were received. All those who took the time and made an effort to take part in this complex process deserve our thanks.

I would like to emphasize the huge contribution made by the members of the committee and many other members who also participated in the bill's consideration during 55 hours of direct evidence.

As evidence of this effort, over 80 amendments to Bill C-14 were made. Some were technical changes. Others were complex and in some instances they reflected differing and difficult choices among competing stakeholders' points of view. However, in all cases, these amendments reflected the careful thought and deliberation that members brought to the legislative process.

As this effort indicates, it is an important bill. It updates or removes economic regulation of transportation modes. For example, alternative means of transportation have made additional regulation of northern air services unnecessary.

We are also modifying the degree of regulatory oversight on northern marine services and regulation of commodity pipelines has been transferred to the National Energy Board.

Turning to the rail sector, I must emphasize that enhancing the viability of the rail industry is a key objective of the legislation. It will set in motion the steps necessary to ensure an effective and viable rail system in this country.

The rail elements of the legislative package complement the strategy of commercializing the CN but they are far broader than that single initiative. They are about enhancing the long term viability of the whole Canadian rail industry. It is important to note that this bill will affect the operations of approximately 31 railways currently operating in Canada.

When the government took office two and half years ago, the two national railways were suffering the effects of a number of structural problems: low labour productivity, under capitalization, excess trackage, to name a few. This had occurred despite considerable work by both railways to reduce costs by various belt tightening measures. Despite being hampered by onerous regulations, both railways have managed to rationalize, reorganize and downsize since 1993.

Outmoded employment security provisions were changed by an arbitration decision rendered last June. Some provincial legislatures have helped out, like my home province of British Columbia, among others. British Columbia recently passed legislation which significantly reduced provincial taxation on railways. Ontario has eliminated its successor rights provisions which applied to the sale of former federal track. I applaud those initiatives.

The federal government decided that it also had to act decisively to put the railways on a more secure financial footing. Commercialization of CN and more important, regulatory reform are directed to this goal. We are moving on this to ensure that we have a viable coast to coast system. In a country reliant on the export of resource materials, a healthy rail sector, the principal carrier of bulk commodities, is an extremely important key to our trading future. A healthy rail industry best serves all stakeholders, not just the railways themselves.

The current system is overbuilt. CN and CP cost cutting efforts have been stifled by the regulatory hurdles that they must jump over to tailor rail line networks to their core markets. At the same time, there have been few incentives in the existing system to market little used lines to the newer short line railways.

Railways must reduce trackage if they are to regain their true financial health. Eighty-four per cent of CN and CP traffic travels on one-third of their networks. It is estimated that some 50 per cent of current CN and CP track is surplus to the main carrier needs as they move to serve their core markets.

The traffic density of the Canadian rail network is presently much less than that of the top seven United States railroads. This means that by moving to similar densities in the range of the United States companies, our major carriers could generate significant savings.

One of the key objectives of this bill to put in place measures to streamline the current regulatory process in relation to the sale, lease or abandonment of lesser used lines. An equally important objective will be the incentive effect it will have on the legislation to establish shortline railways at a lesser cost on many of these lines.

The dramatic increase in the number of shortline railways in the U.S. is one of the major economic achievements of the 1980s. Nothing stops this scenario from being repeated in several regions of Canada, once those elements of the railway transportation legislative framework that did not foster the creation of shortline railways have been removed.

These past 10 months, the concerns raised by shippers and by our two main railway companies have been at the centre of the debates on the transportation bill.

The bill before us today is the product of the contributions made by various stakeholders-officials, interested parties, my colleague the former Minister of Transport, and more recently, the members of the standing committee-toward striking the right balance between their respective interests.

Have they succeeded? This is a question I have asked myself in reviewing this very complex legislative initiative in the two months since I became minister.

First and foremost, Bill C-14 preserves all the key shipper rights won through the National Transportation Act, 1987. These rights are unique to the rail mode and are more extensive than the rights available to shippers in other jurisdictions, particularly in the United States.

To illustrate, the bill keeps regulated rates for captive shippers and adapts them for short line railways. The bill keeps the statutory right of a shipper to final offer arbitration, shortening the process at the shipper's request and extending it to cover rail passengers and commuter service. This bill keeps the provision for confidential contracts between a railway and a shipper.

The decrease in railway prices-nearly 30 per cent since these rates were introduced in 1987-show how much shippers have benefited.

In addition, the bill preserves the traditional obligation of carriers to provide an adequate level of service, or what is commonly referred to as mass transit conveyance obligation, specifying the duties to be fulfilled by a railway in terms of traffic accommodation.

If a complaint is filed, the agency can always order the railway to take corrective measures. No other mode of transportation has this kind of obligations.

The bill also preserves the statutory right of a federal railway to operate on tracks other than federal tracks. This right enhances even more the competitive access of shippers.

Still, in spite of all these measures, shippers have asked the government to make more changes to the bill.

It is well known that shippers wanted section 27(2) deleted, whereby the agency would take into account whether a complainant would suffer substantial commercial harm in deciding whether a regulated remedy was warranted. Because many shippers objected to this provision, the government advanced amendments which replaced the term "significant prejudice" which was formerly used with the term "substantial commercial harm". Other amendments clarify the intent and application of the new terminology. These were two main concerns of the shippers.

Shippers also wanted section 34(1) deleted. This section stipulated that any party to a dispute, which would include railways, must pay the costs if the complaint or behaviour during the conduct of the proceedings was found by the agency to be frivolous or vexatious. Again amendments were made to address the shippers' concerns.

Section 27(2) was rewritten and clarified by government members of the committee and was subsequently adopted unanimously by the standing committee.

Section 34(1) was dropped.

Shippers also wanted section 113, which is now section 112 of Bill C-14, to be deleted whereby the agency would be required to set rail rates and conditions that are commercially fair and reasonable. I find it very hard to accept any argument that a regulated result should not be commercially fair and reasonable. This section however was subsequently clarified to specify that the result must be commercially fair and reasonable to all parties.

Initially, some shippers also wanted to extend to provincial railways the compulsory and mandatory running rights. We have concluded that this was both problematical and unnecessary, and could hinder the development of shortline railways.

I am convinced that this long process has provided an opportunity to review carefully all shippers' concerns and that action was taken regarding several of these concerns. I think that the outcome will be profitable to shippers as well as railways.

We must bear in mind some of the principles underlying the bill. Regulation should be a last resort, since solutions that are freely and mutually agreed upon are the best. A balance must be struck between sometimes incompatible concerns.

Railway companies have one main goal: viability, a goal which is also in the best interest of shippers and-I must say-in the best interest of Canadians as well.

Our common goal is to have a viable railway system, consisting of main carriers and shortlines, which will ensure that railway service will continue to connect as many communities as possible across the country.

To sum up, the objectives for rail which the bill meets successfully are: to promote the long term viability of railways; to foster the creation of short lines; to preserve key shipper rights; to preserve rail service to communities to the extent possible; and to reduce the regulatory burden on railways. It has been an enormous undertaking.

In easing the regulatory burden that had been placed on rail in the past, over 1,000 pages in various statutes have been reduced to just 100. In doing so the bill lifts regulatory intrusions into the railways' day to day business affairs. Most important, the bill streamlines the rail line rationalization process. This is the most effective legislative means of bolstering the railway's efforts to cut costs.

This way, if a buyer comes along, a railway can sell one of its lines without delay to another railway, which will continue to operate it. In the absence of an immediate buyer, the bill provides for a simple process to dispose of surplus rail lines, by encouraging their sale or lease to shortline railways.

However, if sufficient notice has been given and no private or government buyer wants to buy the line, the railway will be authorized to sell it as it pleases.

All concerned, including main railway lines, will benefit from efforts to foster the creation of shortline railways.

The public interest will be protected since the government will have the option of buying a line that no one else wants to operate for rail purposes. This is indeed the best way to promote the continued operation of a viable system from coast to coast.

During the committee's review of the bill, concerns were raised by some about the length of time for governments and others to react when a line might be discontinued. These concerns have been addressed through amendments to lengthen somewhat the time lines at the beginning and the end of the process. For instance, each level of government will now have up to 30 days to purchase a line rather than 15 days in the original bill. Amendments such as the example I have cited demonstrate the government's flexibility and resolve to make this important piece of legislation both effective and fair.

I feel that the bill as now drafted represents an admirable balance. The standing committee and all its members from all parties in the House is to be commended for its excellent work. It is an example of how well the standing committee process can work and how it can handle extremely complex legislative tasks.

The bill will now be considered by the Senate and I look forward to the outcome. Bill C-13 complements other transportation reform initiatives that the government has introduced. The Canadian transportation system must be dynamic and as unrestricted as possible if it is to meet the demands of our changing economy. This legislation, once passed, will achieve this. I am proud to have had a part in its progress at the third reading stage.

Canada Transportation ActGovernment Orders

10:25 a.m.


Paul Mercier Bloc Blainville—Deux-Montagnes, QC

Mr. Speaker, I believe everyone agrees that the principle of Bill C-14 is a good one: rationalizing, unifying and modernizing the existing legislation on public transportation, most particularly rail transportation.

No one can be against these goals of unification, modernization and rationalization since no one, even the official opposition, can be against virtue. We are, therefore, in favour of the principle. We also consider some of the clauses to be good ones, but others are so bad as to be unacceptable.

The amendments we moved to correct those shortcomings have all been defeated. For these reasons we are opposed to Bill C-14 and will vote against it.

The key reasons why we are opposed to Bill C-14 can be summarized into four points. The first deals with the creation of the short line railways, which represent the secondary elements of the system. Because the system's future depends on them, their creation ought to have been facilitated. The minister has just pointed out that, very recently, such secondary lines have multiplied greatly in the U.S.A., to the public's benefit.

The second reason why we are opposed to this bill is that the procedure for a company to abandon a trunk or other line looks at virtually nothing except profit issues and goals, whereas the public interest ought to hold far more importance.

Third, the bill maintains privileges for the west which accentuate or maintain the differences we are already used to between the west and Quebec.

Fourth, and most important, despite all the talk about decentralizing powers, we see that the government has not been able to resist the ingrained habit, any time new legislation is introduced, of taking advantage of the opportunity to nibble away at provincial powers, as well as to ignore the provinces when their interests are quite obviously concerned by the measures planned.

The first point, then, is the creation of short line railways. I would remind my listeners that these are entities whose development can ensure the survival of the secondary part of the system, which, it must be pointed out, has been scandalously neglected from the maintenance point of view. This has been both scandalous and profitable, perhaps, since the objective was to obtain permission to abandon the lines in question. In order for them to be abandoned, they have not to be used anymore. In order for them not to be used anymore, they need only not be properly maintained, and the result is achieved. Except that now certain sections of this secondary network are in bad shape.

Buyers, generally small companies with little capital, are being asked to take these sections in their existing bad state. Because the legislation governing the railway companies resulted in the network's being in such bad shape, we asked for but failed to get a mechanism from the federal government whereby railway lines would be repaired before being put up for sale, since local companies potentially interested in taking over the lines generally have little capital. Our request was not met. The SLRs that might have been the future of the secondary network are getting no help in setting up.

The other reason we will be voting against this bill is because the abandonment procedure follows market logic only. In the past, when a company wanted to abandon a section of rail line, the National Transportation Agency had to call public hearings. I recall having testified before agency commissioners in defence of a section. Public hearings are no longer held. If a railway company finds that a section of line is not profitable enough, it declares its intention to abandon it. It is true, and this is a good point, that the bill requires a company now give longer notice in announcing its intention to discontinue service and that it be according to a plan previously drawn up and made public.

But once the information procedure relating to the sale of a section of the network is completed, the rest is pure mercantile logic. If there is no buyer, well, there is no buyer. If there is no buyer, public authorities at the municipal, provincial or federal level are given some time to express their interest in buying it.

Of course, there is hardly enough time for these authorities, and especially municipalities, to organize public hearings. Up until now, we were happy with the current procedure whereby the Canadian Transportation Agency held public hearings before allowing companies to abandon rail lines.

The third reason we oppose this bill is that it perpetuates a system that is biased in favour of the West and that constitutes another example of the imbalance in the treatment of Western Canada, on the one hand, and Quebec, on the other hand. This bill contains a number of clauses we want to see deleted. Clauses 147 to 155 amend but also restore certain privileges for Western Canada.

These clauses set a maximum rate and special conditions applying to the transportation of western grain. These provisions were introduced in the National Transportation Act in 1987, when the Western Grain Transportation Act or WGTA was repealed and the subsidy eliminated.

At that time, western farmers were compensated generously, to the tune of $3 billion, for the elimination of the subsidy and the abrogation of the WGTA. In its bill, the government reintroduces the provisions that were originally in the National Transportation Act, 1987. Yet, western farmers were generously compensated, unlike their counterparts in Quebec. In fact, dairy producers received no compensation whatsoever for the recent elimination of their subsidies. Western farmers should therefore be in a good position to face the new transportation conditions in Western Canada and to adjust to a commercially oriented rail system, since we are told that the main purpose of the bill is to commercialize the network.

Giving unequal treatment to western and eastern shippers, as these eight clauses tend to do, can only lead to inequitable development of the rail system by adversely affecting the resources carriers can invest in the eastern network.

But what is really telling, although it was to be expected, is that the government and the minister are giving themselves discretionary powers in this bill, without even providing for consultations-and I mean mere consultations-with the provinces, in situations where the provinces should obviously be consulted.

There are several examples of that. Take clause 7, which deals with the Canadian Transportation Agency, formerly the National Transportation Agency of Canada which, incidentally, also has a new role. Clause 7 provides that the governor in council shall appoint not more than three members for a term of not more than five years. The expression "not more than" means that there could be one, two or three members appointed. The minister may also-he may but he does not have to-appoint three temporary members, for a term of not more than one year, from the roster of individuals established by the governor in council.

This is not a criticism, just a comment in passing. If there are three members for a maximum of five years, and if the minister may appoint other members, it seems to me-unless I do not understand French-that the CTA could be made up of only one individual. This is indeed a possibility, given the wording used.

The provisions on the CTA's membership include no criteria, benchmarks or obligations for the minister regarding the various interests of carriers, users and the general public. The whole process is discretionary.

Yet, it might have been appropriate to appoint members from a list of names submitted by interested parties. There are not even geographical criteria. Imagine that there are four members. I am just making a point but, strictly speaking, all four could come from the same region. There are no criteria and we want to at least correct that situation by saying that members, whether temporary or not, should be appointed on the advice of the four regions. Ten provinces was too much. We had defined four regions: the Atlantic provinces, Quebec, Ontario and the Western provinces. That was rejected out of hand and it is now up to the government to choose the members of the CTA.

One good thing is that the bill provides for situations that it defines as extraordinary, in which the governor in council may take special decisions recommended by the minister to cope with situations that require urgent action or for which there is no particular provision in any other act of Parliament that would offer a solution.

In this case, situations defined as urgent are those that could endanger the interests of the operator, all the interests of users and the public interest, with the exception of strikes.

In such situations, the governor in council can take special measures. But, if an urgent situation arises in a province, how can provincial authorities be left out of it? In addition, how can the matter not at least be referred to the Standing Committee on Transport? None of this is covered. We have the government arbitrarily taking control, setting itself up as the sole arbiter.

Another measure, good in principle, contained in the bill is the provision requiring that the legislation be reviewed after four years. However well thought out a piece of legislation is, the final test is obviously how well it stands up to real events over a period of time, before a decision can be taken to leave it as is or to introduce amendments. It is therefore a very good idea that the bill includes a provision from the outset for a review of this legislation in four years.

All this is fine and well, but who will review the legislation? It will be reviewed by individuals appointed by the minister. Once again, we are not told that these individuals will be chosen with the approval of the provinces or from lists prepared by the interested parties. No, not at all. The bill provides for a review after four years. There is no guarantee that all interest groups will be called upon to give their opinion on the legislation because shortcomings have shown up in practice. They say that the communities will be consulted, but this is obviously very vague.

We wanted the agency to be consulted, and the provinces, but there is nothing new. The omniscient, and therefore omnipotent government, as infallible as the Pope, will decide.

The bill provides for the construction of new rail lines, which is not something that happens much these days. In particular, we ought not to expect to see HSTs in the near future. Soon we may be the only country, with the possible exception of Zimbabwe, not to have high speed trains. However, the legislation does provide for the construction of new lines. The agency will grant authorization to a company requesting to build a new line, if it meets certain criteria, and if the route appears to serve the interests of the carrier, the users and the regions it crosses.

But-and this is truly incredible-the province concerned is not even asked for its opinion. If there is one field that is really specific to the provinces, it is the development of their territory. Either the province exercises that right directly, or the municipalities do so on its behalf. This is an exclusively provincial area.

In Quebec, the municipalities draw up land use plans for authorization by the province. These then lead to zoning plans. Imagine, a new line is to be constructed in a municipality. It is possible that the zoning plan, the land use plan, did not include the route of that line. Thus, we must trust the federal government's wisdom not to trash the zoning plan and the land use plan by putting the line through. It is absolutely incredible that putting in a new line-part of the development plan of a region-does not require consultation with the province, yet this is a specifically provincial jurisdiction.

And now for the icing on the cake: centralization disguised as decentralization. Clause 89, against which we tabled amendment No. 17. I must read it, because it is such a juicy tidbit.

  1. If the construction or operation of a railway is authorized by a Special Act passed by the legislature of a province and the railway is declared by an Act of Parliament to be a work for the general advantage of Canada, this Part applies to the railway to the exclusion of any general railway Act of the province and any provisions of the Special Act that are inconsistent with this Part.

This is absolutely typical. It would, however, have been simple, rational, and respectful of the provinces to state in a general and unrestricted way that a railway constructed by a special act of a provincial legislature remained under provincial authority. That would have squelched the federal government's hunger for power, which is totally contrary to what it is saying.

Sadly, I must conclude that, with Bill C-14, railway transportation is losing some of its noble mission of public service. Essentiality, railways are intended to serve the public. Rail transportation is tending to become a business like any other, serving not so much

the public as the political interests in power. The state has bowed to market pressures.

I must thank the government for again giving Quebecers, in this bill, one more demonstration that there is absolutely no hope within the federal framework of one day seeing the logic of public interest cease to be constantly subordinated to political or profit making imperatives.

With Quebecers at least, Bill C-14 will have that one positive aspect. Thank you for that, Mr. Minister of Transport.

Canada Transportation ActGovernment Orders

10:50 a.m.


Jim Gouk Reform Kootenay West—Revelstoke, BC

Mr. Speaker it is an irony speaking today on Bill C-14. The hearings are finished, the amendments are finished. They were voted on last night.

All we will do today is have a post-mortem on what has taken place, a eulogy for the things that might have been much better in a bill that has a lot of good merit in it.

There are a lot of good points in this bill, but it could have been much better. There are several areas where the government has either included things that should have been taken out or failed to inject things that should be in the bill.

I will deal with both the things that should have been taken out and with the things that should have been in such as protection for utility companies or municipalities with regard to their infrastructure systems, sewers, water, roads and so on.

Before I get into that, I find myself in the strange position of defending the government. There are some good things in the bill. We have heard in debate from the NDP objections to some of the very things that give the bill some merit.

NDP members talked at length about the abandonment procedure and tried very hard to put in a bunch of amendments which would have basically cancelled the changes that took place. They lacked a basic understanding of the entire abandonment procedure, both the old one and the new one.

NDP members claimed during debate that they have been talking in the coffee shops of Canada. I do not doubt they have. It is too bad they did not know what they were talking about when they were doing it.

The Canadians I have talked to both inside and outside Parliament want a continued rail service, period. They would like to have the service we have now continue, but short lines are certainly a viable alternative.

I have to reiterate what I said in debate about how the old procedure worked and what the problems were. If a rail company wanted to abandon any rail line, short line, main line, it does not matter, the procedure for abandonment of a rail line was that it first had to prove financial hardship.

Before it made that application, and rail companies would be loathe to admit this but we all know it is a fact, it made sure that if financial hardship did not already exist it created it.

The way it creates financial hardship if it does not already exist is by demarketing the line, by going to the shippers on the line and providing some alternative method of shipping their goods to market or at least to a railhead.

This happened in my riding in the Slocan Valley where there was one primary shipper, Slocan Forest Products. CP Rail, in its intention to abandon that line, went to Slocan Forest Products and wrote a confidential trucking contract, we presume at very favourable rates, perhaps even below its cost, to ship its goods to the nearest reload centre in Nelson, B.C. where rail lines still exist.

It also did absolutely minimal maintenance on that line. That is not to say it did anything illegal or that it ran a line that was unsafe, but it ran it at absolute minimum standards. The evidence of that is by the time abandonment was actually approved, we had trees growing in the middle of the rail line. That does not happen on a well maintained line.

As a result the line was abandoned, but no short line operator in its right mind would bid to preserve and operate a line which had no customers left and which would cost a fortune in repairs and upgrades, when normally the rail line would have been maintained.

With the new procedure a rail company does not have to prove financial hardship. It can apply to abandon whatever line it wishes but it has to go through a very set procedure.

First it has to publish on a three year planning list which lines it wishes to abandon. It is not committed to abandoning them, but they would be lines under investigation or under scrutiny by the rail company with the possibility of divesting itself of those lines.

If it wishes to proceed, it has to offer in a prescribed manner those lines for sale with all kinds of published information to the general public so that short line operators or those that wish to become short line operators could consider purchasing them.

After the set period of time, if the company has not succeeded in selling the lines, it then has to offer them, in turn, to the federal, provincial, local, municipal and regional governments at their net salvage value. This gives every possibility of preserving those lines because the lines have not necessarily been demarketed or brought down to the lowest possible maintenance standards.

We believe these measures will enhance the ability of short line operators to take over the operation of rail lines.

I have spoken to several short line operators and they are aggressively looking to increase their operations and take on new lines. This is a very positive move to enhance the viability of short line operations, which may be a viable alternative to rail operations in marginal areas.

The amendments put forward by the NDP, though well meaning, may have harmed rather than helped the situation. I will now deal primarily with Reform motions which would have either added things that are missing from the legislation or taken things out which should have been out in the first place.

Three Reform motions deal with municipal government and utility company protection. We heard from representatives of the Federation of Canadian Municipalities and various utility companies regarding their concern about the infrastructures of their sewers, water, gas and power which pass in most cases under, and in some cases over, rail rights of way.

The problem is that if a line is sold or ultimately abandoned, in most cases there is no registered easement for the companies or for the various municipalities. This is a problem for municipalities which have designed their whole infrastructure systems for the crossings. They would like to have something in the bill which would ensure the protection of the lines for all the people they serve in the various communities in their areas.

I do not think that is a particularly unreasonable request. It is not a cost factor to the rail companies. Those who would argue against this would say the municipalities or the utility companies can expropriate. They can in many cases, but that costs money. In the end those costs fall to the very people who use these services, the taxpayers.

Again I am defending the Liberal government. The Liberal government needs the Canadian taxpayer to have as much money as possible in order to pay all the Liberal bills generated by the government. I truly am looking out for the best interests of the Liberals with these motions.

Unfortunately the Liberals rejected every one of the motions that would have protected the municipalities. They would have protected all the towns and villages that rail lines go through and all the infrastructure systems that go under or over the rail rights of way. The Liberals turned their back on them.

I hope those people will remember that when the Liberals start trying to get even more tax dollars out of them and there are problems at the municipal level because of these rights of way.

Another Reform motion that is missing from the legislation is some measure of protection for Atlantic Canada. Motion No. 38 was a Reform motion that provided one of those protections. This was an amendment that would have seen a five-year guarantee that the CN Rail line from Montreal to Halifax would continue in operation. This goes back to Bill C-89 which was the CN privatization bill.

People from Halifax, the port authorities and other representatives from Atlantic Canada came before the committee with regard to Bill C-89 and asked for a 10-year continuance of that line. They put forward some very good and sound arguments.

I put that amendment at committee level and it was supported by at least one Liberal member of the committee from Atlantic Canada. In fact the vote was a tie and the Liberal chair of the committee had to break the tie and did so by voting against Atlantic Canada. The same people came before us with regard to Bill C-89 and Bill C-14 or Bill C-101 at that time, saying they still need this. They said they could live with five years and cut their request in half.

Ports commercialization or privatization is coming in. All the ports will have to look out for themselves, raise their own capital on the marketplace and be responsible for it. The federal government is not going to guarantee the loans. I do not have a problem with that. These ports should stand on their own. They should operate on a commercially viable basis. The ports that came before us on this issue said they were prepared to do that.

However, they cannot go to investors and ask them to put money in if they cannot ensure those investors that while they are developing their post-Panamax facilities to get ready for the coming generation of new and larger freighters, they do not have some guarantee that they are going to be able to transport those goods from Atlantic Canada into central Canada and the American midwest.

As it happens Halifax is the ultimate best port for not only reaching central Canada but for reaching the American midwest. This does not take away from any of the inland ports, for example, Montreal or the Lakehead, because if these post-Panamax ships do not come to Halifax they are going to the New England states or to New York. It is Halifax or it is somewhere outside of Canada. The ports need the CN Rail line with its connection through the Sarnia tunnel to get to the American midwest market.

If I were going to invest in the infrastructure of the Halifax area I would want some assurance that the rail line was going to stay intact until such time as these post-Panamax facilities were developed, the market was there and the goods were being shipped. At that time the port will be prepared to stand on its own.

Liberal members were asking why Reform was interfering with the free enterprise of CN Rail by saying it had to do something for a

five-year period of time. The Reform Party is supposed to be the free enterprise party so why is it trying to bring in such an amendment?

I pointed out that for 80 years successive Liberal and Conservative governments had interfered with the marketplace, specifically with CN Rail, by having this crown corporation doing things that were far removed from normal commercial practices. All I was asking for was a five-year transition period while it went from this crown entity to the private sector.

The head of CN Rail, Mr. Paul Tellier, appeared at the hearings on Bill C-14. I asked Mr. Tellier that as he was required under the act to provide a three-year plan was he looking beyond that to four, five or six years? He said that he was. I then asked if he had any plans over the next five years to discontinue the line between Montreal and Halifax. His response was, no, absolutely not because CN had made a lot of investments in Atlantic Canada in facilities and there were no plans to do that.

The Liberals could have accepted the amendment that I brought forward so that Halifax could go to the investors and say: "There is your guarantee that the rail line will remain". It would not have cost CN or the government or the taxpayers anything. In fact, the only thing that could cost the taxpayers money is if Halifax has trouble raising capital in order to do its post-Panamax facility upgrades and loses the traffic to the United States. This was a win, win situation but the Liberals said no to Atlantic Canada.

Last night we had a standing vote on Motion No. 38 and one by one, each and every Liberal in this place rose and voted against Atlantic Canada. Why did they do that? Could it be that they simply do not want Atlantic Canada to develop any form of financial independence? There can be no other explanation.

Clause 27(3) would not have been required at all. The Reform Party tried to amend it but that would not have been needed if the Liberals had done the right thing with clause 27(2) but they did not. This does not fix clause 27(2). I have to make that clear. Our motion tried to make it slightly more acceptable.

The main source of the items we listed in our amendment to try to better define what is significant commercial harm was provided by the NTA representative stating items that would clarify clause 27(2) so we put those in.

I am going to mix a couple of things together here because clause 27(2) is strongly entwined with this. The minister said this morning that clause 27(2) got unanimous support at committee. Unlike Bill C-89 which went to committee after first reading, we supported it. The Liberals said this would make it more amendment friendly. They were not telling an accurate story, shall we say. When it got there we did propose amendments after listening to the various people who came before us. The Liberals rejected each and every amendment out of hand with very little discussion. After the fact, we discovered that they would have been much better off had they brought in at least the majority of those amendments. The government knows that now. Maybe it knew it then, but for whatever reason it chose not to listen.

The Liberals had a change of heart on Bill C-14. They seemed to be much more open to amendments and they did support a tremendous number of Reform amendments which were brought forward. They went so far as to ask me what I would like to see in the bill. That is very hopeful for the future if they are prepared to do this.

The Liberals did accept a lot of our amendments. Unfortunately, a couple which they did not dealt with clause 27(2) and 27(3). One thing that I tried to do was recognize that if the government does not want to take clause 27(2) out it is going to be passed because after all it has a majority and can pass anything it wishes.

At committee level I tried, first, to make the clause a little more palatable with an amendment which would define much more specifically exactly what was then referred to as significant prejudice. In part, the agreement I made verbally was that if the government accepted this, I would support clause 27(2) at the committee level, knowing full well that we still had report stage to deal with this after I had another opportunity to speak to the various shippers who were concerned about this.

What the government did was a little sneaky. Perhaps I should have said that it had broken its agreement and therefore I no longer had an obligation but I stuck with it.

I put forward an amendment that would define the meaning of clause 27(2). The government pre-empted it with one of its own, which was much softer than mine. Once the government's amendment was in, there cannot have two amendments proposed on the same clause at committee stage, so it took precedent over mine and mine was not considered. That was the same amendment that I brought forward at report stage.

The government should have supported my amendment as it was proposed, as I did what I had agreed to and that was support clause 27(2) at the committee stage provided the government amended it.

Reform supported two amendments which removed objectionable clauses from this bill. I would like to discuss the one that deals with clause 11(2), commercially fair and reasonable. At the committee hearings I asked the NTA representative to define commercially fair and reasonable. The following is a quote from the testimony before the Standing Committee on Transport, November 7, 1995 by Mr. Ashley of the National Transportation Agency responding to my inquiry.

Mr. Ashley stated: "What is commercially fair and reasonable is I suspect consistent with what is competitive. What is competitive in any circumstances depends on product market, geographic market, the elasticities of demand for that product, temporal aspects, production efficiencies, market structure, market conduct and market performance".

"I can tell you that on the street it would mean covering the fixed cost long term average variable cost, contribution to fixed cost and perhaps a return on shareholder equity. But to say today that in the future it will be what the agency does in every case would be wrong".

"The competition people have appeared before you. The law is predicated on competition in the marketplace. If you look at case law under the Competition Act, the courts would have stated that even a non-compensatory rate, a below cost losing rate, can be a commercially fair and reasonable competitive rate. Perishable goods, production oversupply, the jurisprudence under the Competition Act shows that a commercially fair and reasonable rate can be many things in many circumstances and what is commercially fair and reasonable today may not be tomorrow".

Responding to Mr. Ashley I said: "Let me point out what you have just said. When I asked you about the meaning of significant prejudice you said it could be argued'. When I asked you about the meaning of commercially fair and reasonable you saidI suspect it means'. That is little comfort to the shippers. If this is what the NTA does, if this is how they decide, it is no wonder the shippers are worried. I suspect',it could be argued', that is no comfort at all, Mr. Ashley".

Continuing, I asked: "Can I then surmise from what you are saying that you don't necessarily agree with these provisions but you are going to work with them to the best of your ability. These things are highly subjective and the NTA, soon to be the CTA, will have to deal with them as best they can".

Mr. Ashley's response was: "That is correct, sir".

I responded again: "You can see where my concern is. The lack of objectivity in this is telling me that they're", and this is referring to the shippers, "probably are right to be worried".

That is the reason we are concerned about that particular clause and why we supported trying to take it out. Let there be no misunderstanding of what the government is saying. That is from the NTA.

Clause 27(2) is undoubtedly the most controversial part of the entire bill. It should have been taken out. This is what is referred to as significant prejudice throughout the hearings and later changed to substantial commercial harm.

I think there was a possible ploy on the part of the new Minister of Transport. Several shippers' groups visited with the minister and the new chair of the Standing Committee on Transport last week and brought forward their concerns about clause 27(2) and what this would do for them. The minister responded: "I was not aware of those aspects. That is really interesting. In light of this I will have to reconsider the government's position on clause 27(2)". This was echoed by the chair of the transport committee.

I asked how I could co-operate with them to ensure the matter was properly addressed. I told them I did not want to make a political football out of the matter, that I did not want to score political points, I simply wanted the bill to be good.

I offered to make an agreement to send the bill, or at least clause 27, back to committee where all committee members could reconsider and make changes so that it would not be a government response to a Reform amendment. They overwhelmingly rejected my offer. Up until the eve before debate they were very open, saying they were considering these things. The morning of debate it was gone from the table.

Since then shippers have told me they think they were set up. They think the minister gave them that hope to keep them quiet so they would not give a press release against what the government was doing. Once debate began, when it was too late to do any of these things, the government cut them off at the knees. I did not suggest this to the shippers, it came from them. I believe they were right.

There were many witnesses at the committee level. We had long hearings which lasted well into the evenings on several occasions. Most of the witnesses strenuously objected to clause 27(2). If we will not listen to the people who come before these committees, the overwhelming majority of them, why do we go through the cost of interpreters, technicians, research people, the clerks, the offices and all the other costs? Why do we have the expense of all these people coming to Ottawa to testify before the committee if we will not listen to them? Attempts to fix clause 27(2) were not accepted by these shippers.

Bill C-101, as it was first known, was basically lost from the Order Paper with the prorogation of the House. The government obviously wanted to bring it back, which it ultimately did. It tried first to bring it back in the old accepted way, by unanimous consent.

Moya Greene, who was an assistant deputy minister in the transport department, called me in British Columbia to ask if I would agree to unanimous consent to bring this bill forward. I said I would provided they take clause 27(2) out of it. She asked why I

wanted clause 27(2) taken out. I said it was because there was such overwhelming to it. She replied that they had fixed it. I said that I would give her the greatest deal ever: "Of all the people who objected strenuously on record to clause 27(2), if you can find me two or three who are prepared to say they objected to it but now accept it, I will reconsider my position". She did not know if she could do that. I suggest, as I did to her, that it has not been fixed.

As I have said, the minister led many concerned shippers to believe he would reconsider clause 27(2). I did everything I could to accommodate this. I brought forward a request to seek the unanimous consent of the House to do that so that it could be done in a non-partisan manner with all of the House agreeing to it. The government rejected my offer.

Who is really against clause 27(2)? The farmers and their organizations are against it, the grain companies are against it, the mining operations, sawmills, pulp and paper producers, chemical companies, manufacturers. Who really benefits? The two rail companies obviously benefit a little, but I do not believe they are the real beneficiaries.

I refer again to testimony of the NTA on November 7, 1995. In this text the term "significant prejudice" is used. This term was later amended to "substantial commercial harm". All shippers I have consulted with agree this change of words has not substantially changed the intent of this clause, if at all.

I asked the witness, Mr. Ashley from the National Transportation Agency, what "significant prejudice" meant. I asked him to define, from the NTA's point of view, what would happen to me if I were a shipper coming before it and it had do something for me or throw me out the door, depending on how it interpreted "significant prejudice".

Mr. Ashley's response was: "I will tell you what I expect the agency will hear by way of arguments as to what it will mean. On one end of the spectrum it could be argued, and I assure you it will be argued, that it is the mere inability of a shipper to get his goods to market because of the railway's refusal to grant a CLR that is, by definition, significant prejudice of the ability of the shipper to get his goods to market.

"On the opposite end of the spectrum, it will be evidence in argument tendered to the effect that in a shipper's inability to get his goods to market the test of significant prejudice will only be met if that shipper has to close his plant".

My response to Mr. Ashley was: "You can see where the problem is. You have just given me an incredible range, including the possibility that a shipper has to go bankrupt before this thing may be decided in his favour. We have to sort of say to shippers `do not worry about clause 27(2), it is great. It will not harm a damn thing as long as you are prepared to go bankrupt'. I find that absolutely astounding".

I continued to ask Mr. Ashley the following: "If we do not have clause 27(2) does it stop you from doing your job? In the last eight years have you had a problem doing your job?" Mr. Ashley's response was: "The answer to that, sir, is no".

Who really benefits from this, as near as I can see, are lawyers. This is according to the testimony of Mr. Ashley, himself a lawyer. Why would the government be interested in doing something that will benefit primarily lawyers?

I have an astounding list in my hand. It points out that the Prime Minister is a lawyer, the government House leader is a lawyer, the minister of agriculture is a lawyer, the Minister of Health is a lawyer and the Minister of Indian Affairs and Northern Development is a lawyer. There is a lawyer's growth industry right there. When the member became the Minister of Indian Affairs and Northern Affairs some aboriginal people he had been working with as a lawyer said: "I thought I had died and gone to heaven".

The Minister of Industry is a lawyer, the Minister of Natural Resources is a lawyer, the Minister of Justice is a lawyer and the President of the Treasury Board is a lawyer. The Minister of Human Resources Development is a lawyer. He is the former Minister of Transport who introduced and helped draft this legislation. Now we know who is benefiting from this.

Clause 27(2) is a deal killer for the Reform Party. Even though there are other objectionable inclusions or exclusions in the bill, there would be enough value in it to recommend its passage if it not for clause 27(2).

The government had the opportunity to improve the bill but did not take it. We all know it has the power to pass absolutely anything it wants whether it is in the public interest or not. Let us chalk up another win for an autocratic Liberal government and another loss for democracy.

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11:20 a.m.


Bernie Collins Liberal Souris—Moose Mountain, SK

Mr. Speaker, I am pleased to speak on Bill C-14, previously known as Bill C-101, as it has some direct impact on the western provinces and certainly my province of Saskatchewan.

I believe the proposed legislation is very constructive, creative and in a manner allows for unnecessary regulations and overlap to be removed. It places greater reliance on parties to negotiate their own solutions on commercial and economic issues and reduce, wherever possible, reliance on regulatory decision making in such matters.

In my view, this wisely places the matters of competition and monopoly in the realm of other appropriate legislation such as the Competition Act.

A number of places were uncovered where general business laws such as the Canada Business Corporations Act would be used instead of having specialized laws for transportation and companies. We wanted to reduce overlap and regulation. These matters were covered adequately by some other body.

This also makes it simpler for stakeholders who might otherwise be faced with confusion or who are burdened with many different pieces of legislation or regulation. Overall the new act will reduce the costly burden of excess regulation and will ensure the long term viability of Canada's transportation system.

First and foremost in my mind is the concern of my constituents about the rail sector. In this area alone, the legislation will reduce government intervention for approvals and decisions on railway actions, limiting them from 200 to approximately 40.

Although the bill is not completely satisfactory to either the railways or the shippers, it serves after months of public and open consultation to strike a compromise.

The amendments brought to the bill were after considerable work by the Standing Committee on Transport. Considerable consultation was undertaken with all the stakeholders. Because of the consultation, equilibrium and balance has been achieved. The bill has effectively addressed the need for balance between the marketplace and government policy issues and what must remain a matter for the regulator to be involved in.

I turn to some matters that drew considerable attention and fire during the debate from western stakeholders. I do this to demonstrate to the House that concerns have been listened to and changes have been made and to reassure western constituents they have not been hung out to dry in the process.

I wish to focus on three clauses that got the most attention while I travelled throughout the riding and when witnesses appeared before the standing committee. They were clause 27(2), formerly known as significant prejudice; clause 34(1), frivolous and vexatious arguments or applications; and clause 113, now known as clause 112, which obligated the agency to ensure any rates or service levels it sets are commercially fair and reasonable.

Let me deal first with clause 27(2). The clause was reworded, although some have missed it, to clear up what had been a problem. It provides guidance to the agency in ultimately rendering decisions. It does not act is a pretest as some had thought. The words "significant prejudice" were replaced by the words "substantial commercial harm", terms that are more understood in law. The new clauses 3 and 5 clearly signify and make clear that this does not apply to final offer arbitration.

In standing committee transcripts Cargill, a major shipper, was asked if these changes would satisfy it. Cargill responded positively. These amendments were adopted unanimously by all the parties in the standing committee.

Regarding the phrase "frivolous and vexatious arguments" many people in shipping organizations raised concerns. That clause has been removed from the bill.

The third major concern is clause 112. "Commercially fair and reasonable" is a phrase that has been heavily investigated and debated throughout the process. There are some concerns raised by the pools. I recall there was a question of commercially fair and reasonable to whom and in whose perspective? The government motion at report stage now adds some clarifying words to this provision. The words "to all parties" answer the questions of the shippers. This underscores the obligation that the agency's set rates must meet the test of fairness and provide the users with rail service.

I do not want to leave the House with the impression that I have conveniently grabbed all of these clauses and I quote them simply to support the position of the government. I have consulted widely with stakeholders and with my constituents on the issue. I feel confident that now is the time to move forward with the bill.

Let me quickly say a few words about the provisions of the bill as they relate to the grain interests in the country. Many witnesses who came forward to the standing committee were pleased that the government seemed to recognize that competition and market forces were not perfect in the grain sector and that a period of transition was needed. The changes that were made, especially in section 27, go a long way to remove the remaining fears of shippers, including grain shippers, about the issue. As well as the protection afforded all shippers under the new legislation, grain shippers will enjoy extra provisions such as maximum rates and a comprehensive hopper car allocation.

The Minister of Transport has indicated that the government intends to sell the 13,000 hopper cars which are presently owned by the department. He indicated that the department is inviting proposals to assess and determine the financial arrangements and the terms and conditions of sale. The interests of all stakeholders, including producers, will be taken into account in this process.

In closing, I will touch on the positive attributes of the legislation. While I was a member of the committee listening to the hearings and particularly presentations from the west, section

27(2), section 34(1) and also section 113 which is now known as section 112 were also major concerns. What happened with those?

We altered the wording in section 27(2) to meet the needs of shippers. Also section 34(1) which said "frivolous and vexatious arguments" was dropped completely, and I think correctly so. In section 113, which is now section 112, we have amended the wording to deal with those people who will be affected by it.

The shippers and rail companies and all who will be involved with new Bill C-14 have to come to the position of making it work. If they want it to work, it will. If they do not want it to work, they will use every effort in their power so that it will not work.

In my opinion, we have set legislation which is a compromise and in the final analysis will meet the needs of shippers, railways and all Canadians.

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11:30 a.m.


Jean-Guy Chrétien Bloc Frontenac, QC

Mr. Speaker, I will use my 20 minutes to speak to Bill C-14.

I am keen to speak on this bill, which is intended to update legislation on railway transportation, to redefine the mandate of the National Transportation Agency and to further deregulate air transportation.

Obviously, I will not be debating the entire bill, but rather setting out for you certain points that are of particular interest to me. We in the Bloc are opposed to Bill C-14 for a number of reasons. The provinces are not consulted on a number of points in the bill, including one of special interest to me-the environment.

As my colleague for Blainville-Deux-Montagnes, the former mayor of the beautiful municipality of Blainville, said yesterday in this House, clause 98 of Bill C-14 is incomplete, because it does not oblige the Agency to do an environmental impact study before authorizing the construction of a rail line, and this is totally unacceptable. I would remind you here of the unfortunate case of the Irving Whale .

In 1970, the Irving Whale sank off the Magdalen Islands and Prince Edward Island. It was, of course, the Liberals who were running the country at the time. Are we going to entrust the environment, as in the construction of a huge rail line or a major section, to a government that showed no environmental concern in the infamous case of the Irving Whale ?

In 1994, we had a sort of committee, known as the Easter-Gagnon committee, that went around the Gaspé, Quebec and the Maritimes. Two backbenchers spent several thousand dollars of taxpayers' money for a political promotion. This was followed by the Department of the Environment's official consultation when the decision was made to raise the barge. The result was an outpouring of over $20 million, and the Irving Whale remains on the bottom.

You will ask me what all this has to do with the National Transportation Agency. The point is simply to show the danger of giving the federal government total jurisdiction over the environment. In fact, the environment is not covered by the Constitution and, until proof is provided to the contrary, it comes under provincial jurisdiction. Clearly, the construction of a railroad changes the rural and urban landscape.

The environmental impact must therefore be seriously considered and, moreover, the provinces should be consulted, since land use is their responsibility.

There is nothing surprising in this. It is one of many examples of the Liberal government's effrontery in pushing the provinces out of their own fields of jurisdiction.

I would be remiss as well if I did not talk about unfairness, since recently I have had a number of opportunities to raise this issue and today will be no exception. Like my colleague for Blainville-Deux-Montagnes, responsible for transportation issues at the federal level, pointed out earlier, eastern Canada faces a very serious problem-the abandonment of several shortline railroads. These sections were left discarded by the federal government and are now in bad shape, for the most part.

As you can easily imagine, once these lines are taken over as short line railways, operating them will not be so profitable, especially since the financial situation of short line railways is rather precarious because of the level of debt and because of the condition of the railways and bridges.

Eighteen months ago in my riding, in the great region of the Eastern Townships and Chaudière-Appalaches, the Quebec Central Railway abandoned the Chaudière-Vallée line, which goes from the city of Sherbrooke to Lévis and Lac-Frontière through Saint-Georges-de-Beauce, a distance of 382 kilometres.

The Quebec Central Railway gave such poor service and charged such high prices in its last 20 years of operation that it lost almost all its customers. Of course, it went before the National Transportation Agency, which gave it permission to abandon the line simply because it was not profitable.

At this point, I would like to remind you that, in the west, it is not necessary to demonstrate that a line is not profitable. Rather, it must be demonstrated that the line is not in the public interest. Since that is much harder to prove given the very large number of grain producers, it is much easier to abandon lines in the east than in the west. Once again, we are up against a double standard.

In the long term, this situation will lead to the failure of several projects and the abandonment of several rail lines. That is why a railway rehabilitation program would correct this situation, espe-

cially in the west and, of course, in the east. In the west, however, they speak a very different language. I often talk about the advantages given to western Canada, including the compensation offered western farmers after the WGTA was repealed and their subsidies eliminated.

While western farmers received nearly $3 billion in compensation, their eastern counterparts were forgotten. This is a perfect example of inequity and injustice. Once again, shippers must face the new transportation conditions in the west and adjust to a commercially oriented railway system. Giving unequal treatment to eastern and western shippers is dangerous, as an inequitably developed rail network will adversely affect the resources carriers can invest in the eastern network.

I have here two short sentences that add to the inequities between eastern and western Canada, including the abrogation of the WGTA announced last year. Maximum rates can be frozen until 1999. In concrete terms, for western grain producers, the ceiling set in 1995 will apply. Railway companies cannot increase it; it is frozen at the level it was at when the WGTA was repealed.

In addition, for over 15 years, these same producers have been allowed to use the government's fleet of hopper cars for free and, if they bought the 10 hopper cars for the transportation of grain, I am sure they would pay a reduced price.

Should we wish the same for Quebec? I doubt it. Quebec is a much larger territory than its neighbour, Ontario. Yet, the length of railway lines in Ontario is twice that of Quebec. Lines twice as long in a province almost half the size means there is actually four times more railways in Ontario. So, the inequity does not go back to this government coming to office: it existed long before 1867 and even before 1841.

Let us now look at construction and maintenance costs. Clause 103(3) provides that the owner of the land shall pay the costs of constructing and maintaining the crossing. Here is what this really means. I own a piece of land and there are 832 feet of railroad over it, cutting it in two. Since I have to cross from the west side to the east side of the railroad, the costs of maintaining the crossing are paid by the owner of the railroad. Now, under this bill, such costs would have to be paid by the owner of the land.

This makes no sense. Property rights pertaining to my farm existed long before the railroad was built. They go way back. Consequently, that clause alone is sufficient reason for me to condemn and to oppose that bill. Farmers who are listening to this debate on Bill C-14 must realize that if they use a private road to go from one side of their farm to the other, they will now have to maintain the crossing. The federal government just gave you a new responsibility, even though this area comes under provincial jurisdiction.

As I said earlier, the owner did not ask the railway company to encroach on his land. Consequently, the costs of constructing and maintaining the crossing must be paid by the company. After all, it uses the land. The same goes for fences. Not more than two weeks ago, it was reported in the newspapers that in Saint-Étienne, close to Quebec City, coyotes or stray dogs chased a herd of cattle over a railway fence and the CN convoy killed 49 animals.

Under this bill, fences would become the sole responsibility of the farmer. If you are a farmer and if a railroad runs over your land, you alone will have to pay for the whole fence, on both sides of the railroad, to keep your cattle from going on it. To those who might think this is fair, let me just say that Quebec's municipal code provides that the construction, maintenance and overall responsibility for fences are equally shared by the two owners. Any good notary knows that.

In its wisdom, the federal government is deciding that from now on you will have to put up your own fences. This will not do. It makes no sense.

Another point. When I was mayor of my municipality, I told you that each farmer had 832 feet, unless they had more than one piece of land. Over the years, a problem began to develop with drainage. As mayor, I met with the authorities of Quebec Central Railway, and it was mutually agreed that they would install two large culverts under the track. There was no problem. Do you know that, with Bill C-14, this would become the responsibility of the farmer? That does not make any sense either.

I would like to conclude with a look at the issue of running rights. In its present form, the bill allows a short line to transport merchandise to the nearest rail head, regardless of the national carrier chosen by the shipper. By giving provincially licensed railway lines running rights on federally licensed lines, a short line could deliver its freight to the rail head of any federally licensed company.

By transporting its freight over a greater distance, a short line would generate higher revenues, as well as offering improved service to its customers and cutting down on freight transfers. This is a logical and efficient improvement with respect to the running lines situation. And if the government is serious in saying that it wants to encourage the development of short lines, it must approve this proposal, which comes from our party, and in particular from the hon. member for Blainville-Deux-Montagnes.

In conclusion, I would like to pay tribute to a businessman in my riding of Frontenac, Jean-Marc Giguère, president of Marco Express. For several years now, Mr. Giguère has been negotiating with the head office of Canadian Pacific to buy 382 kilometres of track linking Sherbrooke, Vallée-Jonction, Lévis and le lac Frontière, via Saint-Georges de Beauce.

Like many of his fellow citizens from Beauce, Mr. Giguère is a courageous and persistent fellow, and he has not given up yet. Every week he heads for Toronto to pursue the negotiations. It is a slow and difficult process. In the meantime, the track continues to deteriorate. Almost one mile of rails and ties was stolen right outside Bishopton. By a fluke, the thief was caught. He went to court and was ordered to reimburse just the value of the old iron, $5,200. How much is it going to cost the promoters to rebuild one mile of track?

That aside, I pay tribute to Jean-Marc Giguère and wish him every success in his efforts to buy and operate this new short line in the Eastern Townships.

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11:50 a.m.


Ronald J. Duhamel Liberal St. Boniface, MB

Mr. Speaker, I would like to make some comments and to ask two questions in particular. My colleague spoke of inequity. It seemed to me that this bill involving many key players is trying to strike some balance. Maybe my colleague would like to comment on this.

I would like to add that the byelection results last night, not only in Ontario and in Newfoundland but also in Quebec, show that Canadians think that the government of Jean Chrétien is quite equitable, fair and responsive.

I believe my colleague was not too "chrétien" on two aspects. For example, he said that this bill did not require an environmental study of its impacts and so on. As far as I know, he is mistaken. Such a study is mandatory under the Canadian Environmental Assessment Act. An environmental study is required before any approval, and this is the case here.

The second thing I want to say is this. If I understand correctly, it is not true, for example, that the damage caused to a land when a railway company proceeds with some construction project is the responsibility of the owner of the land. It is the responsibility of the railway company, not of the owner of the land.

I would like to know whether the member would comment on that. Did I misunderstand what he said? Maybe he thought he should exaggerate things. I would like him to clarify what he said.

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11:55 a.m.


Jean-Guy Chrétien Bloc Frontenac, QC

Madam Speaker, I find the comments by my distinguished colleague from St. Boniface very pertinent. But before talking about environmental assessment and the construction of entrances, fences, and drainage culverts in farmland, I would like to get back to yesterday's election results, since he raised the question.

Last night on CBC, my dear colleague from St. Boniface also probably watched a special two-hour program on the state of the nation. Did he look at the poll results on voters' intentions at the federal level? His party would get 50 per cent of the votes across Canada, but only 35 per cent in Quebec, less than what it got in 1993. The Bloc Quebecois would get 53 per cent, or 4 points more than in 1993. What is going on? I do not want to be called a racist, but he knows where his party's strength is in Quebec. In francophone ridings, it gets walloped.

Look at what happened in the riding of Lac-Saint-Jean with a 22-year old candidate. Whether you like it or not, Madam Speaker, he is going to be the youngest member in this House. He got 76 per cent of the votes. It is a lot more than your leader in the riding of Saint-Maurice where he got a mere 54 per cent, in spite of his joining forces with the Conservatives.

Just yesterday, a liberal member who worked tirelessly in the riding of Lac-Saint-Jean told me: "Of course, we do not expect to win, but it will be a good indication. Watch the results in Lac-Saint-Jean, the Liberal Party is going to shoot up". It did not shoot up, it slipped on a banana peel.

In Quebec, the Bloc Quebecois is working hard, with dignity and modesty. This is the reason why-

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11:55 a.m.


Ronald J. Duhamel Liberal St. Boniface, MB

I rise on a point of order, Madam Speaker.

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11:55 a.m.


Jean-Guy Chrétien Bloc Frontenac, QC

He is wrong, Madam Speaker, do not listen to him.

Madam Speaker, my colleague asked me a question on the election results, I am answering him.

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11:55 a.m.


Ronald J. Duhamel Liberal St. Boniface, MB

I rise on a point of order, Madam Speaker.

I also asked two specific questions of my colleague who suggested that there was no need for an environmental assessment. He is wrong. But, of course, he does not want to talk about that, he wants-

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The Acting Speaker (Mrs. Ringuette-Maltais)

That is not a point of order. The member for Frontenac has the floor.

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Jean-Guy Chrétien Bloc Frontenac, QC

Madam Speaker, you understood that I was about to get to that. But beforehand I wanted to tell my colleague from St. Boniface that we, from the Bloc Quebecois, are representing our province, our country, Quebec, in the best and most faithful way. That is why the opinion polls are so encouraging. I hope our standing will not drop.

I invite the Reform Party to do a good job in showing opposition in this House. They could, as well, kick the Liberal Party out of the other provinces. In Quebec, we are taking care of it. We will take care of the Liberal Party in Quebec. Fairness, that is what Quebecers want. They are frustrated by unfair treatments and have a hard time forgetting them.

My hon. colleague seems to have misinterpreted Bill C-14. Maybe it is not the same in English and in French. Personally, I read the French version, and it clearly says that railway companies have no obligation to maintain crossings, make fences or install drainage culverts under the railway once is constructed.

I remind the member for St. Boniface that, as mayor of my village, Garthby, I had to negotiate with Quebec Central Railway. I reread Bill C-111, which became C-101, which became C-14, and that is how I discovered this shortcoming.

My colleague, the member for St. Boniface, should read carefully the legislation, perhaps in both languages, because the translation often leaves little shortcomings that can change the interpretation.

I conclude rapidly on the issue of environmental assessment. For your party, the past is no guarantee for the future. Take the Irving Whale for example. Early next September it will have been sitting on the ocean floor for 26 years, rusting away and leaking contaminated oil. We spent over $20 million last year, the government organizing three so-called environmental public consultation sessions to end up with nothing, absolutely nothing. We will start all over again this year.

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Dartmouth Nova Scotia


Ron MacDonald LiberalParliamentary Secretary to Minister for International Trade

Madam Speaker, this is a very important piece of legislation, one that has had its roots way back in the first session of this Parliament and perhaps even further back than that.

For years the country has debated the future role of its transportation sector generally and quite clearly since the mid-1980s, 1986 or 1987, the future of rail. As everyone knows, it was on the promise of access to markets by way of rail that was one of the most compelling reasons the colonies, upper and lower Canada and the maritime provinces, came together and formed Confederation.

The debate may go on for a long time as to whether that ribbon of steal was actually a cause for the expansion of the economy like we wished to see in the Atlantic provinces, but I will not argue that today. I am sure my comments have been heard in that regard in other debates in the past.

Suffice it to say one of the things that has happened in the last number of years is that we are no longer dealing with a domestic market in the transportation sector which we can protect. Protectionism has gone the way of the dodo bird. In the last dozen years we have seen an explosion of competitiveness.

Canadian businesses have had to become more competitive. It does not matter which sector we are dealing with. We have had the free trade agreement, we have had the NAFTA, we have had the GATT. There have been agreements under TRIP on intellectual property. Every country that seeks to expand its economy has had to look outward.

The transportation sector is really no different. In the past we have hung our hat on public interest and public policy in order to protect these industries. There were so many regulations dealing with rail and air transportation that they would literally choke a stable of horses, not just one horse.

Clearly one of the things this government and the previous government, to give it a little credit, saw was there had to be a reduction in the regulatory burden in the transportation sector.

In 1987 when the government came out with the new National Transportation Act there was great debate about whether when we deal with rail line abandonment or rail line sale the argument would still be made that a line should be kept because it was in the public interest. I have debated that with myself and with others over the last number of years, in particular since I was elected to the House of Commons in 1988. One of the concerns I have had is that we still are able to maintain a national rail line from coast to coast.

One of the problems we have had, however, in the rail line is that both lines, Canadian National, a crown corporation recently privatized, and Canadian Pacific, were not as competitive as they had to be. One of the reasons they were not as competitive as they should have been is they had some protected markets.

They had an onerous regulatory burden that in my view led to some industries' in Atlantic Canada being less competitive on the international market, in particular the U.S. market, than they had to be to maintain their market share, to do value add in their industrial sector and continue to employ Canadians.

What has happened in the rail sector? Over the years we have seen both of our national rail lines, Canadian Pacific and Canadian National as a crown corporation, losing enormous amounts of money. It seems that when the economy goes into a cyclical downturn, and we can almost project when those things will happen, the bit of money made by these two very large and important companies during the good years is more than lost, many times over, in the bad years.

Over the last number of years both of these companies in the bad times have lost over $4 billion. For Canadian National Railroad, which was a crown corporation, the Government of Canada repeatedly has had to recapitalize that business.

When we came into power we said we had to have a national rail system. I come from a part of the country where a national rail system is essential. It has been there for many years. Unfortunately that national rail system has not allowed my part of the world to be as competitive with its industries as it should be.

Perhaps it is because both those large railroads, Canadian National and Canadian Pacific, when they were covered and wrapped in the warmth of burdensome regulations which protected both of their markets for that sector of the transportation business did not allow my part of the world to be as competitive as it should be.

A few years ago when I was in opposition I was fortunate enough to visit Hamburg. I visited with some interests promoting rail lines, both CP and CN. The thing that absolutely astonished me was when I looked on the wall of the office there was an ad from Canadian National: "Canadian National, serving Canada from Montreal to Vancouver". Somebody had forgotten to tell them there was another part of Canada, the closest part of Canada to Europe, Atlantic Canada.

The rail line at that point was still in place from Sydney to Montreal and somebody had forgotten to market the line. CN, it might be argued, in the past had selectively and intentionally demarketed the line from Montreal east.

Then this bill came in. In the past session of Parliament it had a different number. In this session it is Bill C-14. I was fortunate enough to sit on the privatization task force of CN, commercialization as we called it at the time. One of the things we heard over and over again when we spoke to shippers, when we spoke to provincial ministers, provincial governments and municipalities is that if rail is to continue to have relevance two things had to be done.

First, we had to recognize that rail in Canada could no longer be protected from outside forces, in particular the United States. Rail in the United States had undergone a renaissance. It had by and large been privatized. It had gone through shrinking and now is in an expansion mode.

It had been recapitalized primarily by the private sector and was competing on a daily basis through its connections with U.S. ports, particularly on the east coast but also on the west coast around Seattle and on the south Pacific coast around San Diego for Canadian bound traffic.

If the Canadian transportation sector in rail was to remain competitive, something had to change. CN again last year had a good year, it made some money, but that has not been the recent history of CN. It was clear to me that within a very short period of time, if it was still a crown corporation, CN would have to dip back into taxpayer pockets and would have to be recapitalized.

Quite clearly the government does not have the funds to do that. Members from all sides, particularly from the Reform Party, like to tell us all the time we have to accelerate our withdrawal from certain areas the government has traditionally supported. We have to leave it up to market forces. I believe that has to be the case.

The change in the regulatory burden the bill sets is important. When dealing with some aspects of rail line abandonment or conveyance in the past under the old bill there were over 200 different types of initiatives needing government approval. The new bill drops it to 40 or 50, in that area.

Reducing the regulatory burden means companies that are regulated will be more efficient. More than that, by putting this bill into place and by reducing the regulatory burden, by making it easier for short lines to be established in Canada, we should be able to reduce the overall cost of rail transportation. We should be able to make businesses that rely on rail transportation more competitive.

I come from a part of the world, around Atlantic Canada, Halifax, which has a brilliant future. In Atlantic Canada our future, particularly in Nova Scotia, will be based on our ability to trade. It will be based on our ability to very quickly let go of industries which are no longer competitive, which have had to rely for far too long on government support to maintain the jobs.

We have to find out what we can do best in a place like Halifax. In Halifax the thing we will do best is trade. Before Confederation Atlantic Canada and her ports were among the busiest in the new world. They were busy because we traded. That is why we were there. We had the best port in the world, the port of Halifax. It does not require icebreaking or dredging, but in order to get to its markets it requires a rail line and a road transportation system.

Provincial governments work on their road transportation systems. There have been many announcements in New Brunswick. The premier announced in the last year over $350 million in highway construction.

In Atlantic Canada, in Nova Scotia, we have had to refocus our efforts on what we do best, utilizing our location. In real estate they say the most important thing is location, location, location. At the port of Halifax location is our most important asset. We are the closest ice free port to the huge European market. We have a skilled workforce. We have plenty of industrial land. We have a reasonable taxation regime; it is not an onerous burden.

Nova Scotia is the only province that does not charge provincial tax on diesel fuel used in rail. In Nova Scotia we are trying to refocus.

When the privatization of CN first came to the task force, I admit I had grave concerns. I still have some concerns. CN had to be privatized. CN had to rely on market forces and it has to be as

competitive as it could be to keep the business it has to keep for its new shareholders.

Privatizing CN also meant that CP, its main competitor in Canada, had to become more competitive. Those two rail lines becoming more competitive with each other also means they will be more competitive with other modes of transportation and other rail lines which are capturing Canadian bound traffic through U.S. ports and running over U.S. rail lines.

Deregulation had to take place. We had to take that onerous burden off both those rail lines. This bill seeks to address some of the concerns of an onerous regulatory burden. I have watched what CP has done in Canada. I am not going to criticize it but CP has made a very strategic decision to abandon its eastern Canadian operations. It had a rail line that went into the port of Saint John. That rail link was essential to the port generating the net revenue and the jobs it had done in the past. The port of Saint John is not doing the business it had been doing when CP still had a rail line.

CP made a decision that it was going to go through a U.S. port of call. It bought the D and H rail line down through the United States. One of the states had given it $5 million, $10 million or $15 million to upgrade it but CP made a strategic business decision to abandon the line in maritime Canada. I have a concern that CN Rail will make the same business decision.

Clearly I would have liked to have seen in this legislation a requirement that under a privatized CN Rail for a specific period of time, be it three years or five years, the newly privatized corporation would not be able to abandon the line. If it did abandon the line, that line would have to come back to the federal government and the responsibility would lie with the federal government. Why did I think that was important during the task force deliberation? It was important for two reasons.

First I know we can compete in Atlantic Canada. The port of Halifax will be able to generate the new revenue, the new traffic required but I know it is going to take a little bit of time. It is not going to happen overnight nor is it going to turn on a dime, it is going to take some time.

My concern then and what still concerns me is that over a period of time, over the first two or three years with a privatized company with CN, decisions will be made which may not be similar to the decisions CP made and would put the very existence of that rail line in doubt.

I do not think we need special treatment in Atlantic Canada. We have to pull ourselves up by our own bootstraps and we can do that. The port of Halifax is experiencing a growth in traffic, not because of government subsidy, but because we have the best darn location to be found on the eastern seaboard of North America for that type of business.

Second we are going to succeed down there because increasingly as we get more trade from Europe and as post-Panamax vessels start plying Atlantic waters as they are currently doing in Pacific waters, there are very few ports on the eastern seaboard of North America that can handle those vessels. Halifax can handle those vessels.

We have reduced our costs of operating the port of Halifax. My government has come in with a marine transportation policy which will have a local port authority established, something I have begged the previous government for. The member for Thunder Bay knows that from the past Parliament. I said to let us do what we can do best, let us compete.

My port has said that on port fees it is prepared to have user pay as long as it is reasonable, transparent and that the government provides its service that it is paying for as cost competitively as possible.

I look with a great deal of optimism on the future of rail in Atlantic Canada but those concerns I have just expressed are ones I will continue to be very vigilant about. If I do see that the recently privatized Canadian National starts talking about making decisions similar to what CP has made which would jeopardize the main rail line from Halifax to Montreal, I give a guarantee to my constituents and I give notice to my government. I will be the first on my feet in this place and any other public forum to make sure that the privatization of CN, along with the very good provisions of Bill C-14 which have reduced the owners regulations, are not used by a newly privatized company, CN.

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12:15 p.m.


Elwin Hermanson Reform Kindersley—Lloydminster, SK

You will have zero impact. You will be a big zero.

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12:15 p.m.


Ron MacDonald Liberal Dartmouth, NS

The big zero is on the other side and perhaps he can ask the question when I am finished my speech.

Somewhere you have to have a little faith. This issue has been one where it has been difficult for me to put faith in a large privatized corporation.

Over the last number of years, as we all change when we are exposed to new things, I have changed a great deal. When I started in politics in 1988 I really believed that government had a large role to play in my economy in Atlantic Canada than what I do believe today. I know that governments in the past through protectionism, through regulation, through transfers, through regional development programs and policies have tried to do something to create economic growth but by and large they have failed.

In places like Atlantic Canada far too often we see the wonderful entrepreneurial spirit which built that part of the country over hundreds of years crushed because of inappropriate government

supports and transfers. Clearly, the people in my part of the world, my sons, daughters and family want to be able to work and live in Atlantic Canada. In order to do that public modes of transportation, all modes, be they rail, road or air, must be as competitive as possible. As a government or a Parliament we may think we can protect those industries, but we cannot protect them from the competition from south of the border and competition which is now upon us from all over the world.

I know we can succeed in Atlantic Canada. This bill is a step in the right direction. The reduction of regulation and the privatization of CN both will inevitably lead to a more competitive CP. The recently constructed Sarnia tunnel means we will be able to attract a volume of traffic necessary from the Chicago markets to come in through Halifax instead of Baltimore and New York and thus create jobs in Halifax and along the Canadian line down into the Chicago markets. In order to do that we must increase our volume so that we will have full train loads leaving Halifax and going straight to the yards in Chicago.

We have some way to go, but I am absolutely confident that those who are responsible for public policy and those responsible for the entrepreneurial zeal in Atlantic Canada will seize the opportunity and CN will see the rail line from Halifax to Montreal as an important profit centre, not as a cost centre.

With the advent of things such as short line operations, because the bill allows for easier establishment of short line operations than did past legislation, it will ensure that there is a competitive rail link. A rail link is absolutely essential to the economy of places like the port of Halifax.

Nearly $400 million a year in annual net revenue is generated in a city of 320,000 people by the fact that container traffic and bulk cargo comes into our port. It is not for distribution to local markets but serves central Canadian and northeastern and central U.S. markets.

In the tough times of the recession we did not shrivel up and die. CN was not competitive. Rates were too high because of regulatory burden. We have succeeded in the tough times. In the good times that are to come through expanding trade this type of legislation will assist my part of the country to take its rightful place as an entry and exit point to the North American market. Maybe the bill will go a long way to establishing a dream worth pursuing, the establishment of the port of Halifax as the NAFTA port north.

I support the bill with some reservations. However, I will be vigilant during the years ahead to make sure that this newly privatized company does not abuse the new regulations it has been given, but that they are used to ensure that the line between Halifax and Montreal is as competitive as possible.

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12:20 p.m.


Jim Gouk Reform Kootenay West—Revelstoke, BC

Madam Speaker, I would like to ask one question dealing with the hon. member's concerns he expressed at length about the CN rail line from Montreal to Halifax.

I do not know if the hon. member heard my speech this morning when I talked about my concerns. The people of Halifax came to the committee first on Bill C-89, the CN privatization and later on Bill C-101, the new Canada Transportation Act. They asked, begged and implored the committee and Parliament to offer some guarantee of continuance for a period of time for the reasons the member stated, so that the line would not disappear before the post-Panamax traffic was in place.

They wanted assurance for investors that they could invest in the newly privatized or commercialized Halifax port which does not get government support for these loans. I have no problem with that and they did not either, but they said to at least give them the tools to develop their financial self-sustaining characteristics. This is something which will not take traffic away from interior ports such as Montreal or the lakehead because post-Panamax freighters cannot and will not go up the St. Lawrence. They either go to Halifax or they go to the United States. Those are the two choices.

I talked to the president of CN Rail. I asked him if it would be a hardship for him if this was put in. His response was that it would not be.

What the hon. member should know is that the Bloc Quebecois has a private member's motion coming up on April 19 or thereabouts, because CN is not living up to its responsibilities to repair and rebuild the bridge which links the north shore to the south shore. If CN does not do that, if it is allowed to let it run down to the point where it is no longer practical to run it, that rail line will be gone.

We proposed in Bill C-89 on behalf of the member's people in Halifax that there be a 10 year continuance. That is what they asked for. The Liberals shot it down.

They asked for it again when Bill C-101 was in committee. They said: "We have cut our plea to the minimum. We can live with five years. We would like to have 10, but we can live with five. Please give us the five years we need". I reiterate, it is at no cost to anyone. It is not a cost to the internal ports of Canada. It will not take business away from them. It is not a cost to CN Rail. The president of CN Rail said it would not be a problem. I introduced this as Motion No. 38 which was voted down by the Liberal government.

The hon. member said that he would rise after the fact and speak on behalf of Halifax. It is too late. He either speaks now or

whatever benefit this may have brought Halifax will be gone. No matter what he says, it will be gone. He should know that one backbencher rising in Parliament after the fact will not make a difference. He should have been there when we were trying to put this through for Atlantic Canada.

Is the hon. member categorically stating that the Liberal government made a mistake in not passing Motion No. 38 which would have allowed that five years of continuance at no cost to anyone? Is he prepared to stand in the House today to say that he supports the motion now, even though it has already been defeated, against the position of the Liberal government which has turned its back on Atlantic Canada?

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12:25 p.m.


Ron MacDonald Liberal Dartmouth, NS

Madam Speaker, we have been listening to a speech from a Reform member whose party has been basically shut out in Atlantic Canada because of its harsh slash and burn policies toward regional development. It wants to privatize everything that walks, moves and crawls, yet the hon. member suddenly rises and pretends he has the interests of the people of Halifax at heart.

I do not need to take lessons from him or from anyone else in the Reform Party with respect to looking after the interests of Atlantic Canada. In the last Parliament 48 sets of questions were asked of the Tory ministers of transportation with respect to the competitiveness of the port of Halifax. Those questions came from the member of Parliament for Dartmouth. There were probably just as many questions asked by the member of Parliament for Halifax in the last Parliament.

In this Parliament it was the member of Parliament for Dartmouth who visited the Minister of Finance on a number of occasions to seek changes to the Customs Act and the Income Tax Act which would allow a port such as the port of Halifax to become a de facto duty free, value added trade centre.

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12:25 p.m.


Elwin Hermanson Reform Kindersley—Lloydminster, SK

You are avoiding the question. You do not have the courage to answer the question.

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12:25 p.m.


Ron MacDonald Liberal Dartmouth, NS

If the member wants to talk about courage, I will talk about courage. The courage is that in the past I have stood in my place here, in my place in my riding and in my place in my caucus and I have never been afraid to speak up for the people in my area. I have done something which members opposite have not done. I have been able to impact in a positive way public policy for the benefit of the people who live in Atlantic Canada.

We need no lessons from the Reform Party. The Reform Party, in the last few weeks of the campaign in Labrador, suddenly found out that Labrador existed. The Reform Party gets up every day in the House to talk about cutting social transfers to the poorest provinces. However, when it is on the election campaign in Labrador it talks about paving the Labrador highway at a cost of $1.1 billion. We need no lessons on this side of the House from those members opposite.

As the member of Parliament for Dartmouth, I raised with the task force on a number of occasions my concern that the rail line should be protected. I still had the concern that rail line should be protected.

Unlike members on the other side who do not think their voices count in this place, I happen to think the voices on this side are listened to by the front benches. I have received commitments not just from the front benches but from people like Mr. Tellier, the president of Canadian National. If we go back to the committee record, when he was asked the question he said that CN had no problem with the continuation of the rail line because CN was not going to abandon the investments it had made in Atlantic Canada, that it saw Atlantic Canada as a future profit centre for the operation.

To answer my hon. colleague's question of whether I give my unequivocal support, no I do not. Am I concerned about a privatized company, whichever it is, coming forward and changing its corporate direction? Yes, I am. However, am I confident that a rail line from Halifax to Montreal will be maintained as a viable entity, either as part of the main line or part of a short line, which I would support although I do not know if the hon. member would? I am confident that will continue because business goes where there is opportunity. There is no greater place in the transportation sector in Canada for new opportunities than there is at the port of Halifax.

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12:30 p.m.


Elwin Hermanson Reform Kindersley—Lloydminster, SK

Madam Speaker, I will ask a brief question of the member for Dartmouth.

He began his speech by talking about a new trading agreement. He talked about NAFTA, GATT and the like. I remember before the 1988 election when the Liberals were fighting the NAFTA agreement, they had advertisements in which they erased the boundary between Canada and United States. Now he has the gall to stand up in the House and support NAFTA, saying how wonderful it is. That is a big flip-flop on the part of the Liberals.

The transportation act we are dealing with, Bill C-14 replaces the old WGTA. The minister of agriculture stated as late as November 1994 that the Crow benefit was going to remain intact, that he had no intention of abolishing it. Three months later, in the 1995 budget, the Crow benefit was gone, another big Liberal flip-flop.

The member is praising the privatization of CN. Reformers have always been on the record as favouring privatization where the private sector can do a better job than the public sector. History is proving that position is right. I would like to remind the hon. member that his party's position was the opposite. It said that privatizing CN was despicable. I believe those were the words Liberals used. Now he is praising the privatization of CN. That is the third flip-flop.

The fourth flip-flop is that he said there should be a guarantee that the CN line remain between Montreal and Halifax. This member is from Dartmouth. He should have the interests of his constituents in mind, yet he is not supporting Motion No. 38 put forward by the member for Kootenay West-Revelstoke, a motion that would have put that in the legislation.

My question is really simple. Why should we believe anything a Liberal says?