Madam Speaker, I consider it a privilege to address the motion put before the House by the hon. member for Sydney—Victoria. It asks the government to take into account the safety concerns and local economic spinoffs before proceeding with any further privatization of Marine Atlantic services.
Before I go any further, however, allow me to assure the hon. member and all other members of the House that safety is the government's top priority when it comes to transportation.
Economic growth and job creation are important objectives and solid reasons behind why the government is pursuing the commercialization of marine services and facilities. Marine Atlantic Inc., a crown corporation established back in 1986, has operated six ferry and coastal services since its inception.
These have included the constitutionally guaranteed ferry links between North Sydney, Nova Scotia and Port-aux-Basques, Newfoundland, and between Cape Tormentine, New Brunswick, and Borden, P.E.I. In addition, a convenient alternative to the highway was provided year round between Saint John, New Brunswick, and Digby, Nova Scotia. Seasonal services were also operated between Labrador and Newfoundland; between North Sydney, Nova Scotia, and Argentia, Newfoundland; and between Yarmouth, Nova Scotia, and Bar Harbor, Maine.
In 1996 Marine Atlantic carried 2.8 million passengers, 965,000 passenger vehicles and 290,000 commercial vehicles. The company has also done an excellent job for many years. Marine Atlantic employees are to be commended for their efforts. Like most organizations, however, Marine Atlantic has been affected by our fiscal concerns and by the need for increased efficiencies.
The national marine policy announced in December 1995 called for Marine Atlantic to substantially reduce its costs and increase efficiency ensuring that the most effective and efficient use is made of tax dollars in the delivery of government services.
As part of the government's efforts to reduce the deficit numerous commercialization initiatives have been concluded with both the private sector and the province of Newfoundland. These have had a significant impact on the operations of Marine Atlantic.
I would like to provide the hon. member for Sydney—Victoria with the following update. In July 1995 Newfoundland accepted a one time cash payment of $55 million in exchange for assuming responsibility for the provision of ferry services on the south coast of Newfoundland, previously provided by Marine Atlantic, and services between Jackson's Arm and Harbour Deep provided by a private operator.
In March 1997 Newfoundland also took over the remaining ferry services in Labrador provided by Marine Atlantic as well as assignment of the St. Barbe, Newfoundland, and Blanc Sablon, Quebec, ferry services in exchange for a lump sum payment of $340 million. This service was provided by Marine Atlantic in 1997 under contract with the province. Future provision of the coastal service is under study by the province.
In the spirit of the national marine policy a request for proposals was issued by Transport Canada in July 1996 seeking commercial interests in assuming Marine Atlantic's Yarmouth, Nova Scotia, Bar Harbor, Maine, Saint John, New Brunswick and Digby, Nova Scotia, ferry services.
This resulted in the selection of Bay Ferries Limited of Charlottetown, P.E.I., to assume operation of these two services effective April 1, 1997. Under this agreement the federal subsidy will be eliminated in three years.
The opening of the Confederation Bridge on June 1 of this year replaced the federal constitutional obligation for ferry service between Borden, P.E.I., and Cape Tormentine, New Brunswick.
As a result of these different initiatives the subsidy paid to Marine Atlantic has been reduced. It will drop from $122 million in 1993 to a forecasted $25 million in 1999. That is a significant savings to the taxpayer. Equally important, and I know it is of great concern to the hon. member, it is a savings that has not come at the expense of service. Those who relied on Marine Atlantic two years ago continue to receive ferry service today either from the company or a private operator.
Marine Atlantic remains an important partner in Newfoundland's economy providing the constitutionally guaranteed service between North Sydney, Nova Scotia, and Port aux Basques and the alternative ferry service between North Sydney and Argentia.
The federal government has not received or requested any proposals to take over these remaining Marine Atlantic ferry services.
The member for Sydney—Victoria will be happy to learn that the federal government will continue to support all constitutionally mandated ferry services as well as those to remote communities. Such services need not always be provided by Marine Atlantic but they must be provided and they must be there in a reliable sense.
Transport Canada will continue to explore options to reduce the cost to the taxpayer of subsidized ferry services. It is expected that Marine Atlantic will continue to operate the Newfoundland services with the aim of reducing costs and increasing efficiency.
The government will continue to regulate ferries for safety. Any operator of ferry services, whether it be Marine Atlantic or someone else, must meet the stringent safety requirements set out by Transport Canada's marine safety branch. Furthermore in most commercialization initiatives it is likely that the same vessel would be used to provide the ferry service under a charter agreement.
Marine Atlantic has been able to achieve significant savings for the taxpayer. Subsidies have been reduced even as service has been maintained. Safety remains a top priority and all ferry operators must continue to meet the highest standards.
The federal government believes it has done an excellent job assisting in the transition to a more flexible and efficient arrangement for ferry services. We are therefore happy to support the private member's motion:
That—the government should consider the advisability of taking into account safety concerns and local economic spin-offs before proceeding with any further privatization of Marine Atlantic services—
Such concerns have received top priority since the day the national marine policy was announced almost two years ago. Hon. members can be assured that they will continue to weigh very heavily in all the government's policy decisions.