Mr. Speaker, I am pleased to have an opportunity to speak to this legislation, Bill C-5, at second reading. This is an extremely important piece of legislation as it affects the offshore of Newfoundland and Labrador and the workers who risk their lives in a dangerous occupation, travelling back and forth to oil rigs, working on exploration vessels and working offshore for as much as three weeks at a time in an industry that is constantly changing.
At the beginning of offshore exploration, exploration was going on in shallow waters near to shore. Now there are oil rigs and exploration hundreds of kilometres offshore. Transportation is by helicopter, which takes as much as two or three hours to get back and forth. That is clearly a dangerous situation, as we know. Not only are risks being assumed by individuals in pursuit of a livelihood for themselves and their families; but it is also extremely important economic activity for the provinces of Newfoundland and Labrador and Nova Scotia, as well as for the taxpayers and the Government of Canada in terms of sharing in the revenue from the offshore oil industry in Newfoundland and Labrador and Nova Scotia.
Unfortunately, for many years, going back as early as 1992, the offshore safety regime was not controlled by the provinces themselves for workers in Newfoundland and Labrador or in Nova Scotia. The labour portfolios had responsibility for occupational health and safety. That was taken away in 1992 by legislation and given over to the offshore petroleum boards. In their supposed wisdom of the day, they had draft regulations. It was not a situation in which somebody who did something contrary to those draft regulations could actually be charged, treated as an offender, taken before a court, fined or dealt with appropriately and be required to follow the regulations. No, it was a very different regime. The regime was that there were draft regulations, and those draft regulations were really just a framework or guideline. That was entirely unsatisfactory to the workers, and my party in both Nova Scotia and Newfoundland and Labrador were very strongly opposed to this particular approach.
I will quote from former Justice Wells, of the Offshore Helicopter Safety Inquiry, who talked about this issue. The minister claims that this has nothing to do with the Cougar crash and inquiry, that this is something that has been going on for a long time, but it is very important to know that Mr. Justice Wells did a very extensive study of the offshore health and safety regime. He led an inquiry into the Cougar helicopter crash that happened in March of 2009, in which 18 people were on board a helicopter that crashed; 17 were killed and there was 1 sole survivor. It led to an inquiry being undertaken by former Justice Wells into these fatalities. He talked about his work, learning about how health and safety deficiencies are attended to in the offshore oil industry. On page 275 of his report, he stated he learned the differences between prescriptive regulation and performance-based regulation.
What we have in this particular situation, until now, is what are called performance-based regulations. In other words, the regulator comes up with a plan and objectives for safety, and the companies decide how they shall go about meeting those objectives; whereas the regulatory regime in this legislation says what must be done, the standard that must be met, and the requirement is to comply. New Democrats have been calling for this power for years. When anyone objected to the regime that only had guidelines, the answer always given was, “We have the ultimate power, and that is to shut down the operation if it is deemed to be unsafe”.
That, of course, never happened. With the cost of doing that, the way of getting compliance was not satisfactory. We then get into a situation where the same agent, the same organization, the same agency that is responsible for the management and control of the operation, control of the whole of the exploration and production activity, methods, schedules and all of that, is also dealing with health and safety.
That has been deemed by many countries and by the Wells commission of inquiry to be unsatisfactory. He says in his report—and recommendation no. 29 has already been mentioned by one of my colleagues—that there should be a new independent stand-alone safety regulator:
Such a Safety Regulator would have to be established, mandated, and funded by both Governments by way of legislative amendment, regulation, or memorandum of understanding, or other means.
In the lead-up to that he said:
I believe that the recommendation which follows this explanatory note will be the most important in this entire report. Until the end of 2009, the C-NL offshore operated under a primarily prescriptive regime which established the requirements under which the oil operators filed their Safety Plans, received authorizations, and conducted their exploration and production. The essential task of the Regulator was to ensure that the oil operators adhered to what was required of them. This was called the prescriptive system of regulation.
They then changed that entirely. The regulations changed into the performance goal-based regime whereby the regulations specify, and the regulator sets the goals and the operators respond by saying how they will achieve them.
He was not satisfied with that. He said that the new offshore goal regulator regime was introduced by regulation in January 2010. There were no changes made at the time to the regulatory body to strengthen and prepare it for the new and much more demanding regime. He says that there ought to be a separate, powerful, independent, knowledgeable body equipped with expert advice, and he made the recommendation I just quoted.
That is the one flaw in this regime. We support this legislation because it brings us from a situation of operating with draft regulations to a situation where we now have regulations in force. We have authority by legislation. This has been worked on for a number of years by negotiators on behalf of the workers in both Nova Scotia and Newfoundland and Labrador. The former NDP Government of Nova Scotia and the PC Government of Newfoundland and Labrador worked on these for a number of years.
The labour representatives support this approach. They support the fact that this regulation is there. They worked very hard to achieve a situation where they believe that the offshore workers have the same level of protection as the onshore workers. That is an important principle that is included in this bill. As a result of the work of the labour representatives in these negotiations, they believe this has been achieved.
The second principle is the protection of employees' rights to know and to participate, to refuse unsafe work and to be protected from reprisal. That is there, as well as support for an occupational health and safety culture that recognizes the shared responsibilities in the workplace between employees and employers for a safety regime.
That is why we support it. We think it is a good step forward to ensure that the safety regime is covered by enforceable legislation, and we think that is going to be a better system to protect workers and to protect workers who refuse unsafe work.
Where we have the problem is in the fact that it is included in the same regulatory body as all other aspects of offshore development, whether they be plans for production or exploration, design of facilities and all of that. There is no separate regulator.
Why should we have one? Looking at other countries, we see that in 2001, for example, Norway adopted the concept of having a separate safety regulator. A few years later, Australia did the same thing. Their rationale for imposing separate safety regulators was that there may be inherent conflicts within a single regulator that, on the one hand, regulates exploration and production and at the same time is required to make the hard decisions that a safety regulator must make.
We also had the same situation in the United Kingdom, where it was also believed that this was required. These changes were made and they came from government, not from industry. The changes have been fully accepted by industry, however, and they are deemed to be working, according to Justice Wells in his report, and he said that it was “...independent minds outside the industry which perceived the inherent conflict between exploration and production on the one hand and safety on the other...”.
A second problem that goes against the notion of continuing with a single regulator is something called “regulatory capture”, which is well known in the industry and other types of industrial regulation. I am reading here from the report at page 277:
...regulators and those they regulate work so closely together that friendships and close working relationships can develop. Common interests and what are sometimes referred to as cozy relationships may unconsciously influence the hard decisions that safety regulation requires.
The report did not state, nor did Justice Wells say, that he found that type of regulatory capture in existence. The offshore industry is relatively new and small, and he did not expect regulatory capture to occur. “Nevertheless”, he said, “every effort should be made to ensure that it never happens”.
These are two of the reasons why this should be a separate regulatory body. As Justice Wells said, the recommendation was one of the most important ones he made. It was adopted by the Newfoundland and Labrador government; it supported that recommendation. The workers themselves support that recommendation. The Newfoundland and Labrador Federation of Labour supports that recommendation 29. We supported it in Newfoundland and Labrador and we support it here, that there should be a separate regulatory body.
The minister says we do not need to have a proliferation of agencies and organizations. We are not talking about a proliferation here; we are talking about a separate health and safety regime in the Newfoundland and Labrador offshore industry where it is extremely important to have that concern.
We have a situation now, and it is relevant to the Newfoundland and Labrador offshore and also to the situation involving helicopter transport back and forth to the rigs. That has to do with the resumption of night flights. During the course of Mr. Justice Wells' inquiry, he made an interim recommendation that all night flights of helicopters back and forth to the rigs be stopped. That has been in place since around February 2010, when he made that recommendation. It was implemented by the C-NLOPB, and night flights have not been a part of the regime of the offshore, much to the relief of the workers because part of the evidence heard during Mr. Justice Wells' inquiry was that the survivability from a crash at night in a helicopter was significantly lowered because it happened at night.
The situation is that this helicopter crashed because it had a loss of main gearbox lubricant. The pilots thought, and were told, that the helicopter had the capability of flying for 30 minutes in what is called a “run dry“ state, with no gearbox lubricant. That is a standard for all class A helicopters in use in the world. Unbeknownst to the pilots, there was an exemption given to Sikorsky, and the helicopter did not have that capability, so 10 minutes after the helicopter lost main gearbox oil it crashed, killing 17 of the 18 people on board.
In its February 2011 report, the Transportation Safety Board recommended that all class A helicopters be required to have that 30-minute run-dry capability and asked Transport Canada to enforce that ruling. Transport Canada did not accept that recommendation, nor did it place any restrictions or limitations on these helicopters being used to transport people hundreds of kilometres over the ocean. It left that in place, following what the American FAA did in saying that it would not require Sikorsky to retrofit its helicopter fleet.
That created a regime of concern by offshore workers. They made protestations about it. They made representations to the C-NLOPB. A moratorium on night flights was maintained up until now. However, now the operators, the Canadian Association of Petroleum Producers, are going back to the C-NLOPB seeking to resume night flights. We are back to the situation in which the regulator, which is in charge of all aspects of offshore production safety and regulations, looking at this very question of offshore health and safety.
I believe there would be more confidence among the workers and the people of Newfoundland and Labrador and Nova Scotia if they knew that a decision that was going to be made would be made by a separate, independent health and safety regulator whose only mandate and only concern was the safety of workers. The independent regulator would be making that decision and would take into consideration what the options are. One of the options would be to have more helicopters instead of having night flights.
The issue is how many people can be transported and in what period of time. The reason they want night flights and want to fly in the dark is they do not have enough helicopters to do the transportation in the daytime. The simple solution is to have more helicopters. There is a cost involved, yes, but if safety requires it, then I would expect that an independent health and safety regulator, with no concerns other than health and safety, would be in a better position to make the decision that night flights would not be permitted in the offshore, even if it was a tough decision.
That is one concrete example of the concern that was raised about this issue and the need for an independent regulator. Recommendation 29 of Mr. Justice Wells' report on the offshore helicopter safety inquiry states it very eloquently, with a lot of background information. A lot of work was done, with a lot of consultations and visits to other countries. Whether from the U.K., Norway, or Australia, experts and expertise were brought forward. Retired Justice Wells did a most thorough report and made that recommendation.
It is a pity that it was not adopted by the Government of Canada. The government failed to do that despite the urging of the Province of Newfoundland and Labrador, Mr. Justice Wells, the unions involved, the Newfoundland and Labrador Federation of Labour, and many others who are concerned about the offshore health and safety regime.
That said, we do regard this bill as a step forward. Bill C-5 would put into regulation and legislation what was treated as draft regulations for nearly 20 years. It is an unsatisfactory situation that would be resolved. For that reason, we are supporting the legislation at second reading.
I see that my time is nearly up, but I would be happy to answer any questions or respond to any comments my colleagues would have with respect to the bill. As I say, we support it, but we are concerned that there is a lack of an independent regulator to enforce these regulations.