Madam Chairman, no one asked for the events of September 11. No one invited the terrorists. No one wanted them. People are abhorred with the results and how those actions have basically turned the world upside down. It is a reality that we in Canada and others throughout the world have to deal with the fallout from those terrible events.
Those events have had a huge impact on the airline industry. IATA estimates the economic cost of the current crisis on the airline industry at $15 billion Canadian. In the United States alone 133,000 jobs have already been lost. The Swissair group could be out of business in the next few days.
These are very serious matters that we are dealing with in very difficult times. The question before us is whether or not the federal government should assist Canada's airline industry and, if it does, what form that assistance should take.
In my riding of Etobicoke North, which is very near Lester B. Pearson airport, many of my constituents are very deeply affected, whether they are airline employees, employees of the Greater Toronto Airport Authority or Lester B. Pearson airport, airline taxi or limousine drivers or owners, car rental businesses, airport hotels, airport restaurants or whatever.
Let us refresh ourselves on some of the facts and some of the history. In the year 2000 we effectively named for all intents and purposes Air Canada our national carrier. The alternative was to allow Canadian Airlines to go bankrupt. Maybe in hindsight this would have been the more preferable thing to do. Having lived in western Canada for 12 years I know the attachment and the symbolism of Canadian Airlines, as many of us in the House know.
The government tried to make it work. Overall I believe the integration of Air Canada and Canadian Airlines has been reasonably successful. Granted there are Canadians who have encountered some deficiencies with Air Canada. In fact many of us have encountered them, whether it is cancelled flights, peanuts of the wrong flavour or whatever. We know there have been some service deficiencies.
Today we are not talking about minor service deficiencies. We are talking about the very survival of Canada's airline industry.
I should like to articulate the principles I would use to determine what federal support the government should be responding with for the airline industry. The initial comment by Air Canada's President Milton when he threw out the number of $3 billion to $4 billion unfortunately has tarnished the debate. The number is totally unrealistic given Canada's fiscal positioning. Frankly I think it was a number that was sucked out of the air.
We should be considering the losses that the airlines have incurred as a result of closing down the skies. More important, we should be looking at the challenges facing Canada's airline industry as we move forward.
In fairness and being fiscally responsible we should be limiting it to the airlines themselves. In my riding I know many ancillary industries are affected, but the reality is that if we can get Canadians back into airline seats, if we can get travellers into airline seats, it will begin to have a ripple effect through the ancillary industries we all want.
For us to look at compensating all secondary industries that support the airline industry, we would be having auditors reviewing this for the next 10 years. Frankly at the end of the day I am not sure it would be affordable. We need to keep our eye on the issue of getting passengers back on to airlines. That is a global problem. That is a global challenge.
Canada is responding with measures to make passengers feel more confident about flying in aircraft. Closing the cockpit doors and other security measures at the airport are all helping, but it will take some time for us to get back to that position.
Some argue that the whole world has changed irrevocably as a result of September 11, that we will see businesses teleconferencing and that the demand for air travel will be permanently down.
I am not one who shares that view. Over many months people will start getting into planes. It behooves us all to make sure that our security systems, our border controls and our other ancillary services are done in a way to make sure our security is safe and sound.
If the airlines are up and running again, I think that businesses and individuals who work in that sector directly and indirectly will benefit from that. That is the most realistic approach to take.
In looking at Air Canada and the whole airline industry, although Air Canada seems to be the one with the bigger problem, we need to look at it from the point of view that all stakeholders need to be involved. The federal government alone cannot solve Air Canada's problems moving forward. We have to look at the airline employees, including management. What can they contribute the make Air Canada structurally sound moving forward? What about the debt holders? This has been an impediment to the restructuring of Air Canada. The debt holders of Canadian and other debt holders will have to, as the expression goes, put some water in their wine. Governments at all levels will have to make a contribution.
We need to separate out what happened as a result of September 11 and what issues were impacting the airline industry in Canada before September 11. We do know that Air Canada had some problems. Is that a function of their cost structure? Did it have certain overheads that were disproportionate to what was allowed in the marketplace? Did it have enough flexibility in terms of its union contracts? I know that one of my constituents talked about the concept of in-house scope, which he believes is the largest single impediment to the restructuring of Air Canada.
Was Air Canada in trouble because of increased market share being taken by some of the competitor airlines? If that is the case, that is a problem, because we want to encourage WestJet and the Canada 3000 to create more competition for Air Canada domestically.
We have given to Air Canada an incredible opportunity with a world mandate in terms of the international routes. Yes, granted, there is severe competition on those routes. However, it has an opportunity here, and I know I would like to see it succeed. I think most Canadians would like to see it succeed.
The question is, what is its business plan in moving forward? Does it have a sound business plan? What does that involve? Does that mean restructuring? Does it mean refinancing? Does it mean employees being more flexible with their contracts? Does it mean management taking some salary cuts? Whatever it takes, we have to understand that the federal government alone cannot get Air Canada back into the situation it once was.
Someone asked why does the Government of Canada not purchase treasury shares in Air Canada and maybe deprivatize Air Canada. I am not sure that would be a positive thing to do. I think that would be a retrograde step. Nonetheless, any aid that the Government of Canada gives to Air Canada and Canada's airline companies should have some performance standards, some strings attached to that so that moving forward Canadians feel confident that there is something in it for them, that we have helped Air Canada and the airline industry restructure and because of all that it will become a more responsive and a more customer focused airline industry in Canada.
Although taking treasury shares or maybe deprivatizing Air Canada is tempting in many respects, the question also is why would the Government of Canada want to inherit some of the challenges that Air Canada is facing right now. I am not sure the government can do any better a job than management at Air Canada.
Air Canada is an amazing company and has an amazing opportunity, as do all airlines in Canada. We have to make sure that it is restructured on a sound business footing, that it is sustainable into the future and that whatever Canada does is also matched by some contributions by all the stakeholder groups so that we have a sound airline industry and we can get over the September 11 crisis.