Mr. Speaker, I am pleased to have this opportunity to rise in the House to speak the a bill that has just come to the House for second reading. Therefore, we are debating the bill in principle. It is an act to amend the Canada Transportation Act, railway transportation. I know the NDP transportation critic, the member from Burnaby—New Westminster, has already given a lot of thought to the bill.
In looking over the bill, the NDP is prepared to support Bill C-58 in principle. We will very carefully examine it when it goes to committee. Obviously witnesses need to be heard and we will look at moving amendments that stage of the review. At this point we feel the bill deserves support in principle. It seems to address some of the valid concerns shippers have had for many years over the current conditions of the Canada Transportation Act, which allow for the potential of use of market power by railways.
We believe the intent of the bill is to lower the shipping costs for farmers, and that is very important. Farming in the country has so much Canadian history, culture and heritage. It is increasingly difficult to carry out, in part because of the shipping costs farmers face. It is very important the committee have the opportunity to examine the bill and amend it to deal with the concerns of farmers and shippers.
There is no question that the Canadian Pacific Railway, CP, and the Canadian National Railway, CN, have a virtual duopoly on shipping prices, which is an interesting term. We often talk about a monopoly, but in this context we have a duopoly. There is also no question their financial stranglehold is choking Canadian shippers that rely on the rail system to transfer their products from the farm to the marketplace. Under the current environment, transportation costs are the second or third highest cost of business for bulk shippers. Under this duopolistic regime, these shippers do not have an alternate way to transport their products. This is the reason for the bill.
This is a very serious situation for shippers and the goods they ship from our farming communities. They rely on these railways to get their products across the country or to international market, yet there has been this monopoly stranglehold that has produced a very difficult financial situation.
Although there are over 30 federally regulated railways in Canada, many freight rail customers are captive shippers. That is, only a single railway company offers direct service to their area. For these shippers the railway transportation is not naturally competitive and in the absence of adequate legislative measures, there is a tendency for the railway company to take advantage of its position as a monopolist in a region. Again, that is a very serious situation where local producers and shippers have no competition. They have to rely on a single server, a single railway company, and are held completely captive. I cannot imagine anyone would consider that to be a healthy business environment.
A monopolistic railway would have an incentive to offer lower levels of service at higher prices than it would under competitive market conditions.
Shippers believe this problem must be alleviated with modifications to the Canada Transportation Act that can facilitate real competition.
We heard from the member opposite a while ago. We know that in 2005 the previous government brought in Bill C-26, which allegedly sought to amend the Canada Transportation Act to deal with some of these problems. It needs to be said on the record, that bill was denounced by the Western Canadian Shippers’ Coalition and by other interest groups because they saw it as a half measure. It was not, in any substantive, way dealing with the very real problems these shippers had. In fact, ultimately that bill failed and did not become law.
Now we have a new bill that was introduced by the transport minister on May 30. We believe that this bill has had a more favourable response than the previous bill put forward by the Liberal government. That does not mean it is a perfect bill, but as we are debating it here in principle, we think it merits support and should go to committee.
One of the positive impacts of this bill is that it will remove the requirement for the Canadian Transportation Agency to be satisfied that a shipper would suffer substantial commercial harm before it grants a remedy. I think this is a very key point. The current requirements are so onerous that it becomes very difficult for any mechanism that would grant a relief to any shipper to kick in, so that effect of this bill is very important.
The bill will also extend final offer arbitration to groups of shippers on matters relating to rates or conditions for the movement of goods, provided that the matter submitted for arbitration is common to all and the shippers make a joint offer that applies to them all.
Again, we see that as a positive measure that will allow groups of shippers to act together to take advantage of final offer arbitration in a more flexible way than before. They can have a reasonable expectation there is going to be a settlement when a conflict has occurred.
The bill also allows for the suspension of any final offer arbitration process if both parties consent to pursue mediation. Again, it provides a flexibility, which we think is important.
It also permits the Canadian Transportation Agency, upon receiving a complaint by a shipper, to investigate charges and conditions for incidental services and those related to the movement of traffic contained in a tariff that are of general application, and to establish new charges or terms and conditions if it finds those in the tariff unreasonable.
I am certainly not an expert in this area. The New Democratic Party's agricultural and transport critics are both very well versed in this. Our general opinion is that these provisions will provide a greater sense of certainty and an ability to resolve problems when they arise by ensuring that where there are complaints made they will be investigated. The CTA would have the ability to establish new charges or terms if it finds the current situation is unreasonable.
The bill will also increase the notice period for augmentations in rates for the movement of traffic from 20 to 30 days to ensure that shippers receive adequate notice of rate increases. This is obviously very important. It will require railways to publish a list of rail sidings available for grain producer car loading and give 60 days' notice before removing such sidings from operation.
Again, we believe this is very important. It has been a longstanding problem for the shippers. They do not get adequate notice. One operates a business and understands a certain set of conditions, but then suddenly things change. The list of rail sidings may change and may not be available to the shipper any more. Obviously that would have a very dramatic and unnecessary impact on a local shipper.
This bill also ensures the abandonment and transfer provisions apply to lines that are transferred to provincial short lines and subsequently revert to a federal railway, including the obligation to honour contracts with public passenger service providers.
We do know that at this point the bill has been supported by the Canadian Wheat Board and the Western Canadian Wheat Growers Association. It is important that we note their support.
When this issue was before the agriculture committee just about a month ago in April, Mr. Martin VanderLoo, the president of Huron Commodities Inc., spoke before the committee. His testimony reflected and highlighted very well the current problems for these shippers and producers in dealing with the present environment under the Canadian Transportation Agency.
I will quote for members some of his testimony before the committee:
Huron Commodities moves oats from western Canada to Ontario for processing and further export to the United States. We ship oats from Ontario and Quebec to the U.S. via rail. We ship rye from Ontario and western Canada to major distillers and flour millers in the United States via rail. We ship food-grade soybeans to Japan and Southeast Asia via rail to the west coast and ocean freight further on.
Over the years, we've seen increasing rail transportation costs with severely declining rail service. All the while, Canadian railroads are posting consistent record profits. Although we're not opposed to supporting a profitable railroad, we don't agree that it should be done at the expense of the farmer. For example, as mentioned earlier, we ship oats from western Canada to Ontario for further export to the United States. Unless we are a mainline shipper in western Canada, willing to ship 100-car-unit trains to the west coast, we are just denied service. The same situation is the case with our rye shipments out of western Canada. Unless we can provide 100-car shipments to the railroads for export to the U.S., they are simply not interested.
The railroads have consistently refused to spot cars for any of our shipments, jeopardizing our reliability as a shipper to our customers.
Mr. VanderLoo said to the committee:
We ask you to push for immediate regulatory reform to the Canada Transportation Act before we lose further markets we currently hold.
I wanted to read that into the record because to me it is a very good example of what is at stake here. Here we have companies that are doing their best to operate within the existing system, but they are held captive by these two rail companies. They do not get adequate notice. Provisions can change. They do not get notice of the rail sidings that are changing. It makes their business operations insecure and it makes their operations difficult, with these rail companies racking up huge profits all the while.
Earlier in the debate the member from the Liberal Party was asked a question about whether this bill would deal with rail safety. I do not believe it does. I think it is a bill that deals more with the mechanism of the movement of goods and with ensuring that there is better accessibility for producers and shippers, which is a good thing.
However, I do want to say that certainly from our point of view the issue of rail safety is absolutely huge. We have had horrendous situations just in my province of British Columbia alone. I do not have the list in front of me. I know that our NDP transportation critic in British Columbia, David Chudnovsky, who appeared before the transport committee about six weeks ago, gave a whole list of the derailments and talked about the lack of safety and the increasingly poor environment in operation in our railway system. We are talking about dangerous situations. We are talking about workers whose lives are in jeopardy.
Let us not forget that it was this House, by a majority, that legislated the workers of CN back to work. The NDP was in opposition to that and I believe the Bloc was as well. In case people have forgotten, the issue has not gone away, and the reason why CN workers were out on a legal strike in the first place was their very serious and ongoing concerns about the safety of our railways.
We think of our railways as part of the Canadian dream and Canadian history. Of course they are, but I do not think people understand how seriously diminished these operations have become and how these monopolies have taken over now. There are issues around access, certainty and reliability for the shippers and producers. These things are now at risk.
There is the issue of health and safety conditions for the people who work on the railways and who are very much in jeopardy and at risk. We have seen a recent labour conflict with the CPR workers that involves the same issue. I wanted to bring this forward because it came up in debate. Although this bill does not deal specifically with railway safety, it is a very important matter that should be addressed.
In fact, earlier today we debated another bill that dealt with railways, Bill C-11, which has been approved. We were dealing with a Senate amendment that dealt with the impact of railway noise from the point of view of local residents. It is very interesting that these issues are coming up. It tells us as members of Parliament that these issues have not been addressed adequately in the past. While the previous bill that was brought in by the prior government in 2005 fell far short of what needed to be done, today we are hopeful that this bill, Bill C-58, will do the job.
The NDP will support this bill in principle and we will examine it thoroughly when it goes to committee. We will ensure that witnesses are heard so that we can make sure we really are addressing the legitimate concerns of producers and shippers. I hope there also will be an opportunity to address the equally important issue of safety on the railways. Again, it is not going to disappear. In fact, things are going to get worse.
We will be supporting this bill at second reading and then working in committee to look at what amendments are necessary before it comes back to the House.