Madam Speaker, I welcome the opportunity to deal with the amendments from the New Democratic Party. I understand the reasoning in putting the amendments forward but we believe the three amendments should be defeated, notwithstanding the sentiments that I understand.
Motion No. 1 mixes the questions of licensing and penalties for offences. I remind hon. members that section 174 of the Canada Transportation Act already provides for penalties for contravention of section 64 as follows:
Every person who contravenes a provision of this Act or a regulation or order made under this Act, other than an order made under section 47, is guilty of an offence punishable on summary conviction and liable
(a) in the case of an individual, to a fine not exceeding $5,000; and
(b) in the case of a corporation, to a fine not exceeding $25,000.
The motion insofar as it provides for penalties would overlap and be inconsistent with section 174. At the very least we would need to provide that section 174 does not apply to any offence covered by subsection 2.1.
Also, section 65 provides that in cases of failure to comply with section 64 the agency may direct the reinstatement of the service, which is considered the most appropriate remedy.
Motion No. 3 removes the time limit during which the agency can act on its own motion on review of prices on monopoly routes. The government is of the view that such time limits are appropriate to cover the transition period. As we move to a more healthy and stable airline industry, the government has given itself the latitude to extend the period of time for an additional two years if competition is not developed and there remains a significant number of monopoly routes.
The hon. member may be able to make the case that during the statutory review of the Canada Transportation Act which must begin July 1, this period could be extended even further. We are open to that.
When we debated this in the department, I was very insistent that we put this clause in to allow the agency on its own motion to review the monopoly prices and have the power to roll back and not just wait for complaints. We have to have a proactive Canada Transportation Agency. We have seen in recent weeks some of the inherent dangers. Notwithstanding all the best intentions that Air Canada may espouse, the fact is that when one has 80% of the market, there is a tendency to try to push the envelope a bit more.
On the question of monopoly prices, we want to make sure that small communities are protected. Even though I believe we are going to get a lot of competition in the months ahead, there is no question that some of the smaller communities are vulnerable because they may not be as attractive to competitors. Therefore, the only way we can help the people in those communities is to put this particular clause in play.
This in effect is going to have a two year life. If toward the end of next year we believe that is not going to be enough, then I would certainly, if I am still Minister of Transport at that time, be open to bringing forward amendments to the Canada Transportation Act to entertain extending this motion on its own motion authority for the CTA. The hon. member has made a valid point. Even though I think the transition period will deal with these issues, we cannot ultimately let the power lapse if indeed it is required. I hope that will help the hon. member even though she probably will not withdraw her motion at this stage.
We also think that Motion No. 4 should be defeated. The current process puts the onus on the carrier to produce a fair rate that is reasonable in the opinion of the agency. The effect of this motion would allow the agency to fix prices where certain indices have been met. That goes a bit too far in terms of reregulation. The government prefers to have the agency retain the discretion it would have under the provisions of Bill C-26 as they currently read.
When this was debated in the department a balance had to be struck. If we accept the amendment, we are going further down the road to adopting the 1987 psychology with respect to the Canada Transportation Act which really reregulates the whole market.
Even though I think my friends in the NDP and others make valid points that base airfares have grown unconscionably in the last 10 years, the fact is that advance booking fares and all the other fares one can get with layovers are reasonable. We cannot forget that about 90% of the travelling public use that kind of method. The number of people travelling by air today proportionate to the population is significantly greater than it was before deregulation.
Something which may confuse hon. members and others is that for 10 years there was a duopoly with Canadian Airlines and Air Canada. Everybody talked about it being a competitive environment but it was not. The two carriers knocked themselves over the head each and every day putting on too much capacity, but the base fares were the same. If Air Canada had a seat sale, Canadian Airlines was ready to have one within a few days and vice versa. It was a duopoly. I would not say it was a cartel but it was a duopoly and it was unhealthy.
I travel to Toronto two or three times a week. Before the merger, if a person travelled on an economy or business class ticket, the ticket was interchangeable between Canadian Airlines or Air Canada. There was no price break. There was no real competition for the business traveller. We have to be serious about competition. Some of the measures in the bill, especially on predatory pricing and the powers given to the commissioner, will deal with competition in a very strict fashion.
I was surprised to hear the member say that the bill needed more teeth. This has to be the toothiest bill that has come forward in a long time with respect to regulation of a private sector company. In fact, it is even toothier as a result of what the hon. members and our colleagues did in committee, and I think with good reason.
There is no question that even though we wanted this bill through earlier, the delay in getting it to this stage in the House has turned out to be a bit of a blessing in disguise. We have seen some of the effects of the consolidation of Air Canada and some of the things we do not like about it. There have been a lot of good things, but we have seen some of the negative things. That is what led hon. members to convince me and my colleagues in the government to come forward with another commissioner at the CTA. That alone gives much added protection for the consumers.
In terms of the powers dealing with the Competition Bureau, there was another amendment that came forward from the bureau which helped to toughen up the act. This regime is as tough as we want it to get without going back to the old days of reregulation.
With great respect for my hon. colleague, while the three motions obviously have merit, they should be defeated.