Debates of Feb. 4th, 2013

Fair Rail Freight Service Act

[Matthew Kellway, NDP, Beaches—East York, ON]

Mr. Speaker, today's issue is not about nationalization of rail lines. My speech is about lamenting lost opportunities and the sale of Canadian National under the Liberal government in 1995. It undermined great opportunities that we had to increase the competitiveness and efficiency of our rail services in this country both in terms of freight rail and passenger rail. We are stuck in these circumstances with passenger rail in particular, with VIA Rail not being able to establish priority schedules for passenger travel in this country. I note too that throughout the 1990s the funding was consistently undermined by the Liberal government of the time.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, this legislation proposes small measures when what we really need are comprehensive steps toward a national transportation strategy, within which rail is key.

I want to raise one issue with my colleague that has troubled me for a long time as an advocate for passenger rail. The member pointed out quite rightly that VIA Rail does not own its own tracks. It must get permission and lease them from freight. The increasing problem is that freight trains are getting increasingly longer, which means they can no longer use the sidings that are available. That means that passenger rail always has to go to a siding, because of shorter trains, and wait there while freight goes by. That is undermining the efficiency of passenger rail through freight.

I wonder if my colleague would have any comments.

[Matthew Kellway, NDP, Beaches—East York, ON]

Mr. Speaker, the future of transit in this country should be focused on making passenger transit more efficient. The environmental impact of that would be tremendous for Canadians. I would note too that the emission intensity of passenger rail over the last 20 years or so has improved by about 26% and there is lots of room for greater improvement for passenger rail.

It would be wonderful if there were a way to give passenger rail greater priority on the tracks, to work out some system, so that freight travel could also continue in a competitive and efficient way as well.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank the member for his speech.

I have noticed that my Conservative colleagues often turn up in big numbers for cocktail parties. It is easier for large groups to organize these kind of events, but that is not the case for a nurse from Saskatchewan or a small manufacturer.

The government has been dragging its feet on this, and I wonder what my colleague thinks about the way the government has been listening to small-business owners compared to big groups?

[Matthew Kellway, NDP, Beaches—East York, ON]

Mr. Speaker, the evidence before us suggests that the government has not listened at all well to the customers of these major freight companies. Eighty per cent of them are unhappy with the service they are receiving.

Bill C-52 only goes part way in redressing the concerns and complaints of the customers of CN and CP. The major freight rail companies seem to have had the government's ear in the drafting of the bill.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, every day Canadian shippers suffer from the consequences of getting unreliable freight services.

Farmers cannot get their grain, soybeans and canola delivered to the port on time, resulting in missed ships, upset overseas customers and rotting crops. Lumber and paper companies in more than 500 forestry dependent communities cannot get their products shipped or supplies delivered because of patchy rail freight services, affecting the livelihoods of hundreds of thousands of Canadians. Mining operations, the largest employer for aboriginal people, have to idle productions because they cannot get their coal and other minerals picked up on time.

The effects are real: hundreds of millions of dollars in lost productivity; and countless lost jobs and lower competitiveness for Canadian businesses in the global marketplace. Canada's farming, natural resources and manufacturing companies are innovative and hard-working, but they lose out against global competitors when they cannot connect with their export partners and disrupted supply chains.

Why is this? Why are our farmers frustrated about delayed pickups of their crops? Why are mining companies frustrated about promised rail cars that are never delivered? Why are paper factories frustrated about damaged rail cars on which they cannot put their products? It is because we have a classic case of market power abuse. The small lentil farmer in Manitoba simply cannot get reliable and affordable freight services from a rail company like CN, even though CN made an annual profit last year of $2.7 billion. Those lucky enough to get a contract with CN and CP have to put up with service disruptions, while many smaller companies cannot even get a contract in the first place.

Eight out of ten rail customers are unhappy with the freight services they get from the big rail companies. Around 80% of rail commitments between the rail companies and farmers and grain elevators are not fulfilled. The future picture is even more dramatic. Forty-five per cent of shippers say that their rail freight services have become worse over the past three years.

Why is the situation so bad? Healthy competition in a marketplace brings prices down and creates a balance between supply and demand. However, that is not the case with rail freight services. Rail freight customers are faced with the entrenched dual monopoly. Together CN and CP dominate with a market share of close to 95%. CN alone accounts for 57% of the market based on revenues and CP accounts for 38%. The remaining 5% is 49 short-line operators that haul freight to the 2 main lines.

Around 80% of rural shippers are captive, meaning they have no choice but to go with the one big rail company that operates in their area, a textbook case of a monopoly. They have no choice but to pay higher prices, no choice but to suffer the consequence of unreliable services and no choice but to endure scheduling changes without advance notice.

Canadians have no choice but to get a black eye on the international stage for unreliable export delivery. It is a marketplace that is broken, where legitimate demand is not countered by adequate supply of services. In the words of the Canadian Industrial Transportation Association:

Railway Freight is not a normally functioning competitive market....This is the fundamental issue underlying all the price and service problems encountered by rail shippers....It is dominated by the sellers.

By that, it meant CN and CP.

What about other modes of transportation? Why can rail freight customers not ditch the rail companies and go with delivery by truck or ship?

The Canadian Industrial Transportation Association said:

—the reality of moving to other modes in most cases is not practical in any reasonable scenario. Truck equipment may not be available in the short to medium term and volumes may be too great to transfer to truck....Over the past seven decades, the railways have lost significant market share to trucking and it is likely that most traffic that could take advantage of the trucking option, has moved to truck.

In other words, trucking only works for certain distances, depending upon the value and the volume of the freight. Just to illustrate this point, a train hauling potash carries an average cargo of 10,000 tonnes. That is the equivalent 385 semi-trucks.

Leaving aside considerations like pricing and delivery time, just getting such a fleet of trucks is simply unrealistic, in most case, when the rail company decides not to show up on time.

It is not just the shippers that are captive. Many of Canada's ports are as well.

East of Montreal to the Port of Halifax, CN is the only major railway. A similar situation exists in northern B.C., with CN being the only railway serving the port of Prince Rupert. Likewise, southeastern B.C. and southern Alberta are served only by CP. In parts of northern Ontario, the CN and CP main lines are enough separated that they are monopoly rail carriers in those areas as well.

Given this situation, any efforts from the industry and the government must focus on improving rail freight services, while making the pricing competitive so rail freight customers are not left completely vulnerable.

One of the core issues is that shippers have no effective way to get the contracts fulfilled, if they are even among the lucky ones who are able to sign an agreement.

In the words of the Western Grain Elevator Association, rail companies continue to deliver unreliable services, “because they can—there are no effective legal or financial consequences”.

When it comes to consequences for non-performance we, again, have a completely lopsided situation.

By contrast, shippers have to pay penalty fees to CN and CP if they do not have the promised volumes ready for shipping or if they fail to load the rail cars on time. However, it does work the other way around. If rail cars do not show up on time or if goods are delivered late, there is no problem for CN and CP. They get away with all the unreliable behaviour, or bad behaviour, without paying a penny, or should I say a nickel today? The shipper has no choice but to suffer the economic consequences caused by the rail companies. Therefore, we have a pretty desperate picture of Canada's rail customers.

What has the government done to protect them?

For years, it kept itself busy with talking and making promises. In 2007 the government promised an independent investigation of the situation. The much-heralded rail freight service review finally started in 2008. For almost three years, its experts gathered information, talked to shippers and rail companies, commissioned a much revealing survey and came up with eight key recommendations. The final report was tabled in early 2011.

The minister of transport at that time promised legislation. Then what happened? There was an election. After the election, there was more talking.

More than half a year after the final report, the Minister of Agriculture and Agri-Food decided it was not time for action yet, so he started the crop logistics working group.

Of course, the Minister of Transport did not want to be outdone, so he kicked off a mediation process between shippers and rail companies in late 2011.

However, as predicated, the mediation was ultimately fruitless because there was a complete imbalance of power. CN and CP were unwilling to make meaningful concessions during the several rounds of negotiations. Without yielding any concrete results, the chair, Jim Dinning, released a report in June 2012.

New Democrats have stood with the shippers along the way. I tabled my own bill, the rail customer protection act, using the recommendations of these various reports. I have repeatedly called on the minister to give rail customers fair, reliable and affordable services they need to be successful and to make Canada's economy stronger.

The shipping community has consistently been asking the federal government to fix major issues. They have been talking about this for at least over 10 years. One would assume, after all those deliberations and investigations, the government would present a rock solid bill that would protect rail customers, would level the playing field and would bring a balance of power to shipping customers. Unfortunately, while Bill C-52 is a step forward, it falls short of what should be accomplished.

How? While shippers would have the right to a service agreement in the bill, there is no model, guideline or template to back up that right. Shipping customers want a model service agreement that gives shippers and rail companies flexibility to negotiate, while starting with certain elements already on the table, like performance measurements and consequences for non-performance. They did not get one in the bill.

Instead, the bill has said nothing about what should be in the service agreements. Many shippers are already afraid they have won a hollow victory. They will sit down with a rail company, knowing they have the right to an agreement, but ever component would have to be a concession of CN and CP, which is a very tough place from which to start.

It comes as a disappointment for many shippers that penalties for non-performance are not included in the bill. Rail customers desperately need to include such penalty fees in service agreements to get compensation for service disruption and the resulting damages and productivity losses. The current bill only includes fines of up to $100,000 in the case of arbitration outcome being ignored by either party. That arbitration process is only available to shippers that negotiate a service agreement for the first time.

The other problem is that such a fine would be paid to the federal government, not to the customer. To act as a real deterrent, fines would have to be significantly higher. Keep in mind unreliable rail services are costing customers millions of dollars, while CN made $2.7 billion last year.

Another shortcoming of Bill C-52 is the brand new arbitration process is only available for shippers that are negotiating new contracts. Instead of offering quick and reliable help through conflict resolution to all shippers, Bill C-52 offers arbitration to a small group of shippers. The other problem is that the outlined arbitration process could end up being too costly for smaller shippers. To place the burden of proof on the shippers to demonstrate that they need rail customer services, that they are indeed captives, is indeed unfair and one-sided.

Bill C-52 applies only to new service agreements, not existing ones. That means many shippers will continue to be stuck with unreliable, unfair and unaffordable services. They will continue to be without any conflict resolution process in the case of violations to existing service agreements.

The bill does not even tackle the elephant in the room, which is pricing. For years shippers have been complaining about uncompetitive freight rates. It is common that shippers pay prices that are three times as high as the rail companies' variable or direct costs for services, just because shipping companies can get away with it. There is no choice for customers.

The government is wasting the opportunity to get rail customers not only fair, reliable, but also affordable and competitively priced freight services to give rail customers real protection from unreliable services, price gouging and a monopoly that costs the farm, logging and mining industries millions of dollars.

In conclusion, it is clear that federal action is needed to create a level playing field for Canada's rail customers and shippers, many exporters among them. They deserve fair, reliable and affordable rail freight services to compete and survive.

Bill C-52 is a step in the right direction, but it falls short of the hopes of many shippers. The bill would not cover all rate freight customers. Many would be left behind. It would not provide a model agreement, and customers would have to start from scratch. The bill would not compensate for bad service. What would be the consequence for unreliable service? There would not be much. The bill would not curb the monopoly power of the rail company giants, and it would not end price gouging.

In committee, I will work hard to improve the bill, in line with key customer demands. I look forward to working with the government and the shipping community to address the shortcomings of Bill C-52. I am optimistic that a stronger and more useful bill is possible. It is within reach to finally make rail freight services reliable and affordable for Canadian businesses.

This country was built on railways, and we owe it to the farmers in the Prairies, the paper mill workers in Quebec and the miners in British Columbia that we make Canada's rail system work again for all.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, I would like to thank my hon. colleague for an excellent presentation on the things that are missing from the bill. I wonder if I can turn attention from the pricing, which she quite rightly pointed out is the elephant in the room, and ask about a concern I have that the private freight controllers, the companies running our freight, have been cutting back in a dangerous way on the personnel on board.

We no longer have people on board in the last car, the caboose, which used to be required under regulation, to monitor safety. I believe that the spill at Wabamun Lake, which the hon. member for Edmonton—Strathcona knows about very well, occurred largely due to the cutbacks of key safety positions of personnel on board freight.

It needs to be reliable and safe. We are having far too many derailments.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, the Transportation Safety Board of Canada has made a series of recommendations, some of which are on staffing. Others are on the need for advanced technology to be installed in rail cars. For example, voice recording in the locomotive cab has not been done yet, even though the recommendation is eight years old.

There has been a recommendation for a positive train control system that would provide an automatic braking system. If the conductor happened to miss a light, a track or a red light stop sign, the train would stop automatically based on GPS technology. Unfortunately, that recommendation is again being ignored by the minister. The United States made it mandatory that all trains have automatic braking devices for safety, but we do not have such legislation in Canada.

Therefore, both staffing and technologies should be in place to keep train services safe.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Mr. Speaker, following up on the previous question, I would appreciate more elaboration from the hon. member.

Clearly, the legislation brought forward deals with, to a small extent, the concerns of the sector that needs and wants to ship equipment, supplies and products by rail, including for export. Properly maintained and inspected rail lines are important also to those who are shipping their goods, because if there is a series of derailments, communities get very nervous about the shipping. As was mentioned, in the case of the spill at Lake Wabamun, which was the largest freshwater spill of bunker C seen in the history of North America, a number of things became very evident. One was that there simply was not proper response equipment along the line to immediately address the spill. That would then delay the startup of a train and so forth and create a further backlog.

Could the member talk about the need for bringing these matters together, about the proper maintenance of the rail and the increasing number of shipments of dangerous substances? I find it very interesting that there is wide public dialogue about the potential risk of shipping bitumen by pipeline, yet apparently a higher risk of--

[The Acting Speaker, Conservative, Bruce Stanton]

Order. Time is limited, even though we have 10 minutes.

The hon. member for Trinity—Spadina.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, because the entire supply and demand are so unbalanced, and because we are basically dealing with a monopoly, raising the situation where the government is very reluctant to act, many agencies, such as the auditor, who talked about the importance of tracking and following through on recommendations on dangerous goods that have been spilled, have not had their recommendations implemented. The Transportation Safety Board recommended ways to make sure things are done in a safe way. Yet there is a long list of recommendations of the board that are being ignored. The government has talked about the situation, but actually making things happen, such as having a standard voice recording in the cab so that we can find out what caused the accident, have not been accomplished yet, which is really unfortunate.

[Fin Donnelly, NDP, New Westminster—Coquitlam, BC]

Mr. Speaker, we know that rail freight customers and users have been very unhappy. In fact, we know a large number of them have been very unhappy with the shipping of their goods across the country for some time. We know that over three-quarters of rail freight users are quite concerned. The hon. member has highlighted some of those concerns and has put forward some solutions.

Could the member elaborate on what some of those solutions would be in the context of a national transportation strategy, which I know she has called for, and how the bill could move toward a national transportation strategy?

[Olivia Chow, NDP, Trinity—Spadina, ON]

I will try to answer that question, Mr. Speaker, in the few minutes I have.

My private member's bill would accomplish all of the things rail customers want. My bill would cover all customers, whether they have existing contracts or not. My bill would provide a model agreement so that it would be much faster and easier for the customers and the company to come to a consensus and sign an agreement. My bill proposes that there be financial consequences for bad service delivery so that the customers are compensated if their grains do not show up on time or they end up rotting at port. Customers would not have to book several containers in case the train shows up late or early.

My bill proposes to deal with price gouging and the monopoly of power the rail company has. Unless we deal with that, the situation will still be one-sided. We have to find some balance between the customers and the companies. If not, the customers will continue to be gouged, and the services will continue to be unreliable. I hope my Conservative colleagues across the way will work closely with me and be non-partisan about it.

Let us fix Bill C-52 so that it works for all customers and shippers. Let us make sure that there are substantial consequences if the services are not reliable.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Speaker, I congratulate the member and I have a question for her.

I get the impression that railroads have been used less and less for many years now, and companies have a tendency to close unprofitable routes, such as the route between Gaspé and Chandler. The train goes to Chandler but no longer goes all the way to Gaspé.

I would like the member to tell me whether that same trend is being seen across the country.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, yes, in fact, what is happening is that our national dream is slowly drifting away as CN and CP are abandoning rail lines because they are not always profitable in this vast country of ours. Even though CN made $2.7 billion last year, it is unwilling to service some of the areas that are not turning a substantial profit. Thousands of tracks are being given up, whether they are for passenger rail or freight services. More trucks are on the road. VIA Rail is losing customers. It just had its budget cut by $20 million.

We need to re-examine our entire rail service so that we can come back to the Canadian dream of a rail line connecting all of us from coast to coast to coast.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, it is a pleasure to rise today in support of Bill C-52, with the understanding that it is not exactly the bill that was needed. However, I have absolute faith that our critic, the member for Trinity—Spadina, will be in there valiantly fighting for the amendments to improve this legislation, which does not go far enough.

I also want to acknowledge and thank the member for the amazing work she has been doing on her transportation portfolio. I know in my riding of Newton—North Delta, one of the most critical issues for the residents there is to have a national transportation strategy to help provide a framework so that we can have good, comprehensive public transit that will help us get rid of the gridlock, for the movement of goods and for people. When people do not have to sit for hours and hours in traffic gridlock, their mental health improves and they are much more productive at work.

Today we are here to talk specifically about the amendments to rail freight provisions. We are talking about rail freight customers. We live in a huge country, which is geographically challenged, or I might say, advantaged. We have a diverse climate. When I left Vancouver last night at 11:20, it was still 6°C. Then when I arrived here to our beautiful, balmy weather in Ottawa, it was minus whatever.

Moving goods for mining companies, farmers and even for people who want to ship cars across the country, we realize that shippers have a huge geography to contend with. It was with that in mind that our forefathers had the foresight to build a national railroad. It is unfortunate that we have not been good caretakers of the national gift that was given to us. We have seen it face quite a few challenges. On the passenger side of rail, my colleagues who have rail service in their areas tell us how wonderful it is, but out where I live in B.C. we have had much of our passenger rail cut and the rest is not running that regularly.

When we talk about freight in Canada we are not talking about moving goods 100 miles or 300 miles, we are talking about moving goods thousands of miles across the country, going through mountainous terrain, our prairies, from coast to coast to coast. As well, there is the incredible challenge of our climate, yet we have to keep our freight moving throughout the year.

I am an absolute fan of trains, be they freight trains or passenger trains. Having grown up in England I had access to some of the best train service way back before the British privatized their train service. Britain is now looking to see how it can buy back the rail services and move toward nationalizing that national treasure once again.

I want us to look at some of the key facts surrounding this issue in Canada. We usually talk about quality service. However, here is a fact: 80% of rail freight customers are unhappy with their services. When I think that 80% are unhappy, that means that only 20% are happy. If I were teaching in my classroom today and I was grading a paper that was only 20% okay, it would not receive a very high mark or even a passing mark. As a matter of fact, it would be an abysmally failing mark, and I feel that is exactly what we are doing. We are failing our mining industry, our farmers and other shippers in industries that transport goods using the freight service.

Our services are so unreliable. They cost the Canadian economy hundreds of millions of dollars every year. If there were no other argument, surely my colleagues across the way could accept the fact that when it costs our economy hundreds of millions of dollars a year, it is an issue they need to address immediately. It is not something we should tinker with part of and then just leave alone for a long time.

By the way, I do not give much credit to my colleagues who are sitting in opposition either, the Liberal Party, because it was under them, under their stewardship, that the CN was privatized in 1995. They privatized the track. There is another way, which other countries are looking at where they keep the track and privatize the actual rail service. However, it was that kind of privatization, without checks and balances, without guarantees, without getting contracts in writing into the future, that is jeopardizing the transportation of goods. I want my colleagues to remember that.

We always have to look at our history. History is a great teacher. Basically what we are looking at here today is that if 80% of the people are unhappy and the unreliable freight service is costing us hundreds of millions of dollars each year, just think what it is costing the companies that invest. Think of the rotting crops for farmers who cannot get the service they need when they need it to move their goods from, let us say, the Prairies out to the west coast to be shipped away, or to the east coast. The transportation is stopped. Imagine the idled plants, even on our coastline, that are waiting for the railways to arrive, but they are running late and so they have backlogs. Imagine the mines that miss their shipments. These are the day-to-day realities that these industries have shared with us.

This is a missed opportunity by my good colleagues across the way to come forward with a comprehensive piece of legislation. This particular misstep will continue to hurt Canada's exporters, damaging our global competitiveness and costing us decent jobs. The bill takes a baby step in the right direction, but when we are dealing with hundreds of millions of dollars and peoples' livelihoods, baby steps are not always what needs to be taken. This is a missed opportunity for the Conservatives to address the bill in a comprehensive way.

What we find when we read the bill is that the protective measures do not even cover existing contracts between shippers and rail companies. As well, the legislation will only offer a narrow, costly arbitration process for failed negotiations for new contracts. Key demands, such as the shippers' call to include penalties for rail companies and service agreements, performance standards and an easily accessible conflict resolution process were basically ignored in this piece of legislation.

By the way, these are not the key demands of the opposition. These are not key demands that we have dreamed up. Our critic has done an amazing job consulting with the industries that feel the most impact.

Once again I would say the government is pandering to its corporate friends instead of the industries it needs to be supporting so that Canada can grow its export business and thus address its own economic strength.

Our rail transportation system, despite all its problems, is the backbone of Canada's economy, with 70% of all surface goods shipped by rail. As a matter of fact, if anyone has ever travelled through the Rockies by rail, there is a point where one can stand and see the beginning and the end of a train, because of the geography and the way the rail track was built. If anyone ever gets the opportunity, they should go see that. It is truly amazing. Watching that for what seems like forever, it really strikes home just how much Canadians rely on rail to transport our goods.

Pricing for rail freight services is also damaging Canada's shippers. Bill C-52 explicitly excludes pricing, despite the fact that many in the shipping community were calling for this very thing. One has to think, what is the driver for the Conservative government? It certainly is not listening to the people who need to move crops, who grow crops or mine minerals, or the people who are using the freight service. The government is not even listening to the shippers.

Canada's trade deficit is ballooning. I know the Conservatives like to live under the delusion that they are fine economic managers. However, when we look at the real world outside, it is a very different story. I would like to invite some of them to visit my riding and see that reality for themselves.

Canada's trade deficit is ballooning, reaching almost $2 billion in November. I am not talking about hundreds of dollars or hundreds of millions of dollars. I am talking about $2 billion, a number I do not think many of us could even write down or imagine how many zeroes come after the number two. We would have to go back to our high school days to remember that. We cannot afford to lose even more ground by taking little baby steps. This is the time when the government could have been bold, addressed all the issues and moved us forward in the right direction. We have to be competitive in the global market. Canada's products can only be competitive when we see an improvement in that figure of the 80% of people who are unhappy with the freight service.

Rail freight service is not only central to Canada's economy, we also need a strong freight service to take trucks off the roads and tackle greenhouse gas emissions. I am not going to try to persuade my colleagues across the way about the need for environmental protection. Whether it has been in the omnibus budget bill or other actions around the Kyoto protocol, the government has shown it has absolutely no commitment to regulations that protect our environment. As a matter of fact, it has shown it is not willing to make any movement toward making improvements to protect our environment.

At the same time, I feel it is my moral responsibility to point out to government members that, if it were improved and more people were happy with it and it were running on time, et cetera, at least our railroad service would take many trucks off the road. More people would use the freight service because they were happier with it, and thus it would be good for the environment.

I know that deep down, somewhere, even if not when they are sitting here in the hallowed House but when they are back at home with their children and grandchildren, Conservatives must think about planet earth and what we must do to protect it, if not for ourselves then for our children and grandchildren.

It would have made environmental sense to have addressed some of these issues in a more comprehensive manner. Rail freight is only one aspect where the Conservatives are slow to act. I could give many other examples, but I do not think there is enough time in the day.

From new rail safety measures, which we have been calling for, to cuts at VIA Rail and blocking the introduction of high-speed rail in Canada, Conservatives do not give Canada's rail network the attention it deserves. It is absolutely so. There is nothing more relaxing than sitting on a train and travelling to work and home. I have done this at another stage in my life, and I can say it is far superior to travelling by car to work and back and sitting behind the wheel getting all tensed up.

We are not the only ones who are saying that this bill does not go far enough. There are others who agree with us. As I said previously, the official opposition's critic, the member for Trinity—Spadina, has done an amazing amount of legwork on this. Actually, she has met with many of the movers and shakers in this area. She, herself, has formulated policies and amendments that she is bringing forward based on what she heard, not on some ideological shift way out there or a need to look as if she is doing something, but based on listening to the customers and those who move their freight.

Key stakeholders in agriculture, mining and the forestry industry associations have been calling for rail freight legislation for years; for example, and I am only going to name a few, Pulse Canada, Grain Growers of Canada, Forest Products Association of Canada and the Mining Association of Canada. They want, and we want, to have strong legislation to protect rail customers. However, once again the government has given in to inaction or a tiny baby step of action, which creates a great deal of dissatisfaction.

Let me just sum up a few things. Rail transportation is the backbone of our economy. More than 70% of the surface goods in Canada are shipped by rail. I would say that we need to make sure even more are shipped by rail, to get the trucks off our roads. Eighty per cent of service commitments for agricultural rail customers are not met by the rail companies due to delays, an insufficient number of rail cars, etcetera. That is quite a shocking figure. Agriculture cannot live up to its commitments 80% of the time because of the fault of the railway services. That is quite an eye-opener in itself.

The rail freight service review found that 80% of shippers are not satisfied, as I said earlier, but within that whole group, we have agriculture, a key backbone of our country. How can we live with a service where 80% of agriculture commitments are reneged on, not due to any fault of their own but due to the railway service?

We stand with the farmers, and we know how little respect my colleagues across the way have had for the farmers, and we stand with the mining and forestry communities to end unacceptable treatment and unreliable freight services from the big rail companies. We need a stronger bill and we will do everything we can. I have absolute faith in our critic. We will do that through amendments to protect rail customers, and we will work with the shippers to get them the fair and reliable freight services they deserve.

Unreliable rail freight services cost hundreds of millions of dollars in economic damages. Canadian jobs are on the line. Surely the time to act is now and not to keep waiting. Waiting for Godot will not solve this problem.

[Linda Duncan, NDP, Edmonton Strathcona, AB]

Mr. Speaker, I have to admit that I find it stunning that there is much to-do about these improvements to the transportation system and that the government, through the bill, is going to introduce an arbitration system between rail companies and those who wish to ship their goods. When we actually look at the provisions, they are limited to new contracts. I do not want to put my hon. colleague on the spot; she may not be able to answer a specific question, but it raises the issue of goods that are shipped—mining, equipment, wheat. Surely in most cases there are long-term contracts that have been negotiated. I find the limited nature of this arbitration process rather stunning. Equally stunning is that it is not going to include shipping across the border into the United States and that there are not going to be any penalty provisions.

I wonder if the member could elaborate and speak about the limitations of these improvements that are being made to the rights of those who wish to ship goods by rail.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, as a matter of fact, that is what really struck me today. By the way, I have had experience in arbitration both from the employer side and from the employee side. When I look at this legislation, I keep thinking there is so little here for the shippers themselves. The whole bill is still tilted in favour of the railroads. Going into a system, even when it is called arbitration, if through legislation it is tilted in favour of one party, then it cannot be called fair arbitration.

Also, to rule out the contracts that have already been signed, some for a number of years I would gather, would create multiple playing fields that would make it even harder and give the railroad corporations far more power centralized in their hands and leave the shippers very vulnerable.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, the shippers have been waiting virtually since 2007 when it was suggested in a clear fashion that there was a disadvantage. They looked to Ottawa to provide a remedy, and today we have the legislation before us. Based on the previous question in terms of arbitration and the fact that we know there has to be a mechanism within the legislation, would the member provide what she believes that mechanism should be? Is it a final arbitration? How does she see an arbitration for a dispute between the shipper and the rail company? Does she have a solution for that, or does she see that solution coming out of committee? If so, when would she like to see the bill go to committee?

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, all the questions point out that the bill needs major fixing. One of the fixes is to create a more level playing field between the railroad companies and the shippers. Arbitration only works if there is a level playing field going in. If through legislation, things are tilted so much in favour of the railroads, then the shippers are going to have a disadvantage. I think all those things will get hashed out. I do not know what kind of an arbitration system this is. The ones I have known are that the arbitrator listens and, following the guidelines that are given, the final decision is made. There is no halfway measure when it comes to arbitration.

This also points out that there is a thundering silence from my colleagues across the way, either in speaking during any of the slots or even getting up to ask questions. It makes me wonder what they are trying to hide.

[Earl Dreeshen, Conservative, Red Deer, AB]

Mr. Speaker, I heard some of the discussion about how farmers and farm groups were not consulted in this, and I cannot let this go by. Maybe I was baited into this by the member's last comment.

This legislation is supported by Pulse Canada, the Grain Growers of Canada, the Forest Products Association of Canada, the Western Barley Growers Association, the Chemistry Industry Association of Canada, the Western Grain Elevator Association, the Canadian Fertilizer Institute, Canadian Canola Growers Association and the Western Canadian Wheat Growers Association. These are groups that understand the situation, and yet we hear comments that there was no consultation.

I am at the stage where I wonder what good news the NDP would ever support. Why can those members not support a bill of this magnitude, for which farmers and farm groups have been asking for so long?

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, let me make it very clear. I do not think I stood here and said I am opposed to this piece of legislation, nor has anybody else. We have actually said we support the bill going to committee where we will bring in some significant amendments to improve and add what we feel is significantly missing from this piece of legislation. We are going to be doing exactly that, based on what we have heard and on what those who ship goods are saying to us.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Mr. Speaker, the Green Party is in exactly the same position. We support the bill, but it is a very limited bill. It would provide the shippers of goods by freight access to an arbitration. That is what it does. It could do so much more.

I would like to ask my friend from Newton—North Delta if she does not agree. The committee might not be able to get at it because it exceeds the scope of the bill. However, this legislation could be used to leverage and push for more of a national transportation strategy that would take into account the need to move goods and people efficiently by rail.

[Jinny Sims, NDP, Newton—North Delta, BC]

Mr. Speaker, whenever I think about railways I think of passengers. I also think of freight service, because I have watched freight trains as well. I know how significant rail freight is. I absolutely agree that, instead of dealing with things piecemeal, we need a national transportation strategy that would look at both the transportation of goods and the transportation of people. It is long overdue.

I urge my colleagues across the way to seriously consider supporting my colleague's move to bring forward legislation that would give us a national transportation strategy to take care of the movement of both humans and goods.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is with pleasure that I rise to speak to Bill C-52 this afternoon.

It is a bill that we have been anticipating for a good number of weeks now. In fact, the Liberal Party has been advocating for this legislation, from what I understand, since 2008, and for very good reason. We need to understand and appreciate just how significant our rail lines are to our nation. We do a phenomenal amount of transportation through those rail lines, from coast to coast to coast. Every community across Canada needs to have a strong, viable rail line or access to such a rail line in order to succeed. At the end of the day, CN and CP own a vast majority of all the capital infrastructure that allows us to transport the many goods and products moved every day.

In fact, living in Winnipeg's north end I often pass through the CP yards. We can go over the Arlington bridge and get a very clear indication of the massive size of CP, and that is the smaller of the two railways. CP does less than 40% of the overall transportation of goods and services compared to CN, which does close to 60%. When we drive over that Arlington bridge, we can look on either side and see huge compounds where trains are loaded, offloaded, and their contents transferred to go in different directions, and so forth. We can drive down Inkster Boulevard or Sturgeon Road in the north end, or take a multitude of different bridges that go over the trains, in any single day and see the number of trains, the hundreds of rail cars full of a wide variety of commodities.

Given the importance of our trains in that rail infrastructure, one would think that would be a higher priority for the Government of Canada to recognize—and when I say “to recognize”, that means to get the job done.

The issue that we are debating today is nothing new. As I indicated in a question previously, the shipping industry as a whole, the stakeholders in that shipping industry, have been calling for very specific action virtually since 2007, because of the sense of frustration they have felt over the years. That frustration is based on the sense of fairness.

To what degree is there fairness in the relationship between our rail lines and our rail operators, in particular, CN and CP, which handle about 95% of the traffic? There is a sense of frustration that there is no level playing field, that those two dominant rail lines have too much power and control over freight costs and the type of delivery provided.

I must applaud my colleague from Wascana. The member from Regina, Saskatchewan has been a long-time advocate for this change. I know first-hand because I have heard him on numerous occasions in the last couple of years speak of how badly we need to have the legislation that is before us today. I know he has worked with many of the different stakeholders to try to get a better understanding of why these shippers are in the position they are in, and why it is so critically important that we do more.

He has taken the time, not just in recent weeks or months but for years, to try to raise the profile of this issue with the government. I know that he has already had the opportunity to speak when it was first discussed at second reading. I think he has done a fantastic job in ensuring that the Liberal Party is well-positioned to understand this issue and, ultimately, to take it forward.

I believe that the member for Wascana brings a great deal of credibility as to why this is such an important issue, because he was a former minister of finance. As such, he understands the economics and contribution of our rail lines and how important they are to our overall economy and GDP. He brings an immense amount of credibility to the debate on this issue and has allowed the Liberal Party to be well positioned on it.

We are suggesting that the time has come for the bill to get out of the House and into committee. There are many stakeholders out there who have vested interests, some in the millions and tens of millions of dollars, who want to participate in this debate.

Many people may not realize that one of the largest stakeholders in the rail lines is Bill Gates, the founder of Microsoft, who has billions of dollars invested in CN. However, as much as I might like his product, I am very much concerned for the other end, the people who have the $500,000 farm investment or their life's earnings through generations of families and who want to get their product to market. They are the ones I am really interested in hearing from.

That is not say that CN, CP and the short lines should be denied profits. Only the New Democrats would attempt to do that. We recognize that profits are necessary in a capitalistic market to succeed. However, we also recognize that there is a responsibility to be fair, but we have failed in that. The people who have suffered the most as a direct result are the prairie farmers, the shop floor of a manufacturing business in Ontario, the mining that takes place all across Canada and family businesses. They rely on the rail lines to get their products to market and do not have much of a choice in terms of selection.

Whether wheat, barley or potash, there is a litany of things that a farmer or small corporation uses trains for to get their products to market. This is what they have to go up against. One report canvassing the farming community indicated that it could only rely some 50% of the time on rail cars being in the right place at the right time, even though they had placed their order already. How can one manage a farm operation in the face of this? I think that most if not all members of the House would recognize that is just not right and that there needs to be a consequence.

When we look at Bill C-52, we see a bill that is at least moving us somewhat forward. We are not necessarily happy with all of the details of the bill, but I suspect that there will be a number of amendments proposed once we get to committee, and we look forward to hearing these.

However, the real challenge for the government is to recognize that it has denied the industry the opportunity to provide that direct public feedback. It has held off on this legislation, not once or twice, but on several occasions. Not only did the Conservatives do one study, they did two studies. They have only been in government for six or seven years, yet they have had two studies on the issue.

We know for sure is that there is a high level of interest. From discussions and my understanding from the member for Wascana, we want to afford individuals who would like to come to the committee the opportunity to state their case, to make representations on what they feel is important.

What do I mean by saying that? We anticipate that this legislation will pass. The Liberal Party has indicated that it will co-operate on its passage to committee, because we believe it has taken far too long to get the bill before us today.

What we want in return is not something specific to the Liberal Party as much as it is specific to the different stakeholders out there. We would like to see the committee afford an opportunity those who want to come to committee to make presentations and express their concerns.

I believe that the government needs to hear what shippers and even the rail companies, CN and CP, have to say about the legislation. Given that the legislation has been on the back burner for so long, we recognize that there have been some mild, and I underline the word “mild”, modifications or changes that have afforded some marginal benefits. At least that is what some of the stakeholders have informed us, but nowhere near to the degree necessary.

I think it is very important that through the committee stage we do not try to put limits on how the members might get engaged in this. Sometimes there is even value in taking the committee off the Hill. There could be potential value in that in this situation.

At the end of the day, one of the things we are looking for is a very strong service level agreement, so that the industry stakeholders as a whole feel confident that there is something they can do to ensure that their product will get to market in a more timely fashion.

It saddens most Canadians when they hear of the waste that occurs because of delays or the lack of availability of cars. Those are very real issues that many producers have to face every year.

In the service level agreements, the producers are looking for a commitment in writing to some sort of penalty if the rail line does not live up to its commitment. I refer again to those small producers in particular, but also to all of the different stakeholders who depend so heavily on our rail lines, having their crops at certain stations at the right time in anticipation of their crop ultimately getting to market.

The same principle applies for other things. I am very proud to be a prairie member of Parliament. There is nothing like driving between Winnipeg and Carman and seeing eight or nine huge combines going through one field. One can see the tonnage of wheat being collected. Ultimately, it will end up on a train. The farmers need to feel confident that the train car will be there at the right time for them. Agriculture uses our railway significantly.

Our forestry industry is huge, whether in British Columbia, Manitoba or Atlantic Canada. There are minerals, again from coast to coast to coast, and chemicals of all sorts, as well as fertilizers. What about the oil and gas industry? Imagine how incredibly important the oil and gas industry is to our country. I disagree with the leader of the New Democratic Party. It is not Dutch elm disease. All of Canada benefits from our oil and gas production out west. I believe that the vast majority, 95%, of Canadians, would recognize the true value of it. Our rail lines play a very critical role in that area also.

The dependence on industrial and manufactured goods is very real. How many trains do we see coming across our country, from Ontario or Quebec, full of brand new vehicles destined for car dealerships? Many of them are pre-ordered. An anxious consumer is anticipating the arrival of his or her vehicle.

The list goes on. To get a good sense of how dependent we are on our rail lines, go to a major rail line, park outside for a day, and see the amount of train traffic that travels by. Watch the containers go by. Whether they are Canadian Tire train traffic, or Costco products, products from China, brand new automobiles, containers of Saskatchewan prairie wheat, Manitoba's and Alberta's endless commodities, or lumber from British Columbia, it is virtually endless. To really get an appreciation of how important rail service is to our nation, park outside a main line and watch the hundreds and hundreds of cars that pass every day and imagine the potential.

If one believes in the Canadian economy, as I do and the Liberal Party does, and that the potential is unlimited, one has to recognize that our rail line is going to play an absolutely critical role in the future development of our country. That is the reason I would ultimately argue that the government has been negligent. This has been an issue on the agenda since 2007.

We are glad to see it here today. We support the bill in principle. We want to see it go to committee. We want to have individuals make presentations and express their concerns. The idea is that the government will be receptive to the necessary amendments that would make the legislation better so that when it comes back at third reading, it will receive the unanimous support of all members of the House, given the very important role of our rail lines, which stakeholders and consumers depend on.

With those few words, I thank the House for the opportunity to speak.