Mr. Speaker, I am very pleased today to lead off debate on second reading of Bill C-44, which makes a significant number of amendments to transportation regulations and policies in our country.
Today I would like to concentrate mainly on the air transportation provisions in support of the proposed amendments to the Canada Transportation Act.
Air transportation is an essential tool connecting Canadians to each other and the world. Canada's air industry contributes immensely to the growth and prosperity enjoyed by Canadians, providing an economic engine that supports aspects of economic development in all sectors of our society and is an essential component to the success of Canada's trade agenda.
As the House is aware, the federal government's role in air policy has changed dramatically since 1988 when the domestic air industry was deregulated. The objective of deregulation was to allow market forces rather than the government to dictate the supply and price of air services in the domestic market. At the same time, the Government of Canada implemented and maintained strict controls to ensure appropriate oversight and consumer protection.
In the Speech from the Throne, the Government of Canada committed to provide businesses in Canada with smart government. By this we mean providing an up to date legislative framework consisting of “a transparent and predictable regulatory system that accomplishes public policy objectives efficiently while eliminating unintended impacts”.
In the spirit of this commitment to smart government, the objectives of the proposed air transportation amendments are threefold: technical housekeeping; improved clarity and efficiency; and above all, consumer protection.
In general, the proposed amendments include provisions that would clarify the intent of the legislation to facilitate the regulatory functions of the Canadian Transportation Agency to respond to changes in Canada's air transportation marketplace and to ensure consistency in the application of the agency's regulatory powers.
I will now speak directly to the proposed measures that would further protect Canadian consumers.
In 2000, when Air Canada acquired Canadian Airlines, it served close to 80% of the domestic scheduled air services market. The Government of Canada took a number of measures at that time to protect consumers from potential abuses and to foster a competitive air industry market that was open to new entrants.
Although these temporary measures were effective during the transition period of the air industry in the last few years, they are no longer necessary in the current reality of Canada's domestic air market. The proposed amendments would return the agency to its traditional well-established regulatory and complaints-based function and structure in place prior to 2000.
Today Air Canada remains Canada's largest and dominant air carrier with over 50% of the market. Canada now boasts, however, several national, regional and charter airlines such as WestJet, CanJet, First Air, Air North, and Air Transat, which provide increased competition and consumer choice in all areas of the country from coast to coast and beyond.
The proposed amendments aim to continue to allow market forces to do their work, and airlines, both new and expanding, to make their decisions based on private sector commercial realities, free of unnecessary or impeding legislation. We intend to stay the course of deregulation, which means letting air industries thrive and, unfortunately, sometimes falter on the merits of the business choices they make.
As the House may recall, in 2000 the Office of the Air Travel Complaints Commissioner was created to review complaints and attempt to resolve the matters by acting as a facilitator or arranging for formal mediation of the complaint. The commissioner served a useful function in addressing complaints of potential consumer abuses by a dominant Air Canada and in determining whether complaints should be handled by the agency where the matter related to its exclusive jurisdiction.
Over the past few years, changing market dynamics and the erosion of Air Canada's market dominance by low cost carriers has resulted in a reduction of the number of complaints targeted specifically toward Air Canada. Today, the complaints are distributed more proportionately across Canada's air carriers and relate mainly to regulatory matters falling with the ongoing jurisdiction of the agency.
Our proposed amendments would eliminate the position and office of the commissioner and would make permanent and transparent the complaints resolution function of the agency by integrating this function into the regular operations of the agency. I want to stress that the complaints resolution function and the agency's ability to respond to these complaints remain intact.
I should note that with the recent implementation of the air traffic complaints program, the agency has demonstrated that it continues to respond to travellers' complaints in an informal manner and consistent with its ongoing mandate. In fact, proposed amendments to the legislation would ensure that the agency will continue to have the flexibility to address consumer complaints more efficiently through the existing informal process in place or through the formal quasi-judicial process employed by the agency itself.
This amendment would also allow a more strategic and efficient use of our resources. This is consistent with how complaints are addressed in other modes of transportation in Canada and puts air operators on the same level playing field with these competing transportation modes.
Consumer protection was a major objective of the Government of Canada following Air Canada's acquisition of Canadian in 2000 and it remains so today. Consumers have told us that in the area of airline advertising there remains, however, significant room for improvement. Consumers want clear, transparent advertising that is not misleading. They want to be able to compare different airlines' advertising pricing and to know up front how much they will pay for air services.
Price advertisements prepared by air carriers, either in newspapers, on Internet sites or elsewhere, do not always contain complete or clear pricing information. Often the prices that are advertised are only a fraction of the total cost of the travel, leading to sticker shock when the consumer finds out the final price.
Typical advertised air fares exclude air navigation service costs, other business costs to the airline for provision of air services, and all of these, we feel, should be included with the advertised price. Therefore, the advertised air fares must include surcharges, taxes and any other fees that airlines collect from individual passengers on behalf of others.
While consumers are alerted to the existence of additional airline surcharges and other fees and charges in the small print, travellers often cannot always determine the total price of the ticket until they finalize a purchase.
Other countries, such as the United States, the United Kingdom and Australia, have instituted similar regimes to ensure that consumers have sufficient pricing information. Some provinces, such as Quebec and Ontario, require transparent advertising of air travel by travel agents and other provincially regulated operators. Consumers, we believe, want a similar level of transparency for advertising by airlines throughout the country.
The proposed amendments provide air operators with clear directions in line with consumer expectations and will give the agency the authority to regulate and enforce mandatory standards for transparency in advertising in all media. This will ensure that those standards are consistently applied across the country throughout the industry by all domestic and foreign carriers and their agents for flights operating within or originating in Canada.
This clearly will provide consumers with the ability to readily determine and compare the final price for air travel when making their travel plans and will allow consumers to differentiate between costs being charged by the airline and those levelled by governments and airport authorities for other services provided.
In addition, consumers are entitled to know the terms and conditions of the air service before they book a flight. These terms and conditions contain valuable information for travellers on the air carrier's policy regarding matters such as the carriage of persons with disabilities, how passengers would be compensated for denial of boarding on overbooked flights, what the air carrier will do for passengers should a flight be cancelled or delayed, and under what conditions a consumer could expect a refund or credit for a flight that a consumer cancelled or re-booked.
The proposed amendments would take the current consumer protection provision one step further by requiring all commercial air operators, both domestic and foreign carriers operating services in Canada, to prominently display their terms of carriage at their business offices and on any Internet site from which they sell those services. These proposed amendments would ensure that when consumers made travel arrangements, they would be informed of their rights and the obligations of the air carrier for flights offered.
In conclusion, the proposed amendments continue the Government of Canada's move to a liberalized and open air transportation system in Canada, one which balances the need to update statutory and regulatory instruments to protect and to respond to changes in the air industry marketplace with a responsibility to ensure that consumers are protected in a manner that is consistent with a fully deregulated market.
We firmly believe that these changes to the Canada Transportation Act are warranted, will give the Canadian Transportation Agency the ability to continue to serve the travelling public, and will ensure that Canada continues to have a viable competitive air industry in the years to come. With these proposed amendments, we are regulating the industry smartly to ensure that it is as open and fair as possible to both competitors and consumers.
As we debate the bill today, our time may be short in terms of the House, but we do want to say to the other parties that are very active on this issue in terms of the Standing Committee on Transport that we look forward to receiving their suggestions and possible amendments that could further improve the legislation. Shippers and receivers certainly have brought to our attention some of their concerns in terms of Bill C-44. On behalf of the minister and the department, I want to say that we recommend that those who want changes made should attempt to dialogue with us. We want to develop the best possible transportation system for the good of all Canadians.