Madam Speaker, it is inherent that at least someone takes the time to remind the House and Canadians why we are in the position today of dealing with legislation to address a monopoly air carrier in Canada. Quite frankly we got here as a direct result of deregulation within the air industry in Canada.
I agreed with numerous witnesses, as was done many times in the past when deregulation came up, that it was not the answer. I want to read a couple of statements made by some of those who appeared before committee. This one is from the Federation of Canadian Municipalities which stated:
When the air transportation system was deregulated in 1987, Canadians expected the introduction of new and special service operators to the marketplace, which would increase competition and bring better and less expensive services...by 1993 the industry was dominated by two major airlines competing for market share on every major route. This cutthroat competition undermined the financial stability of both airlines—
The Canadian Labour Congress stated:
The unregulated market has hurt Canada's two airlines without delivering efficiency or higher quality service.
They are two very different groups with the same perspective. All those great promises of deregulation just did not work.
Deregulation has been a public policy failure for consumers, shareholders and workers. The consequences of deregulation have been a crisis in 1992-93, in 1996, in 1999, and now in 2000. We are still dealing with it. We are dealing with layoffs, job insecurity. We saw poor working conditions, wage freezes and cuts, chronic overcapacity in the domestic market and massive cost increases. The overall cost of flying went up 76% since 1992. Gosh, we have to love that deregulation.
Ticket prices outpaced increases in the consumer price index even with seat sales factored in, declining levels of services particularly in small communities and poor investment returns for both the airlines. Competition at any cost without modern regulations was not the answer.
Deregulation was the root cause of the crisis in the airline industry. The solution could have been effective modern regulation, not overregulation and too many price controls, aimed at protecting the public interest and ensuring that Canada's airlines could coexist and compete effectively in the global market. Modern regulations could have seen a flexible approach and the use of government powers selectively to ensure that airlines compete fairly and live up to the public trust.
Profitable high traffic routes such as Toronto, Montreal and Ottawa will naturally attract competition among carriers. These routes do not need government regulation to ensure adequate service. The government needs to play the role of referee to ensure fair competition and prevent damaging anti-competitive behaviour such as the predatory pricing in excessive capacity.
On the other hand, low traffic routes between smaller communities are not guaranteed to attract service. In these cases effective regulations would have been essential because reasonable and affordable service is a social and economic necessity. The government has many tools at its disposal to address this point. Will the bill accomplish that? I do not think so.
Deregulation and unhealthy competition have led to the monopoly situation. What do we do to make sure the monopoly air carrier does not go crazy on us? What can we do? First, we need to recognize that the bill can only work in areas where it does not contravene the agreement made between Air Canada and the competition commissioner and okayed by the transport minister. In essence, it will not address all the difficulties and all the problems that numerous people have talked about and brought before committee.
The bill gives the force of law to Air Canada's commitment in this agreement. However, everybody has acknowledged that Air Canada has been acting irresponsibly and is worried sick over what Air Canada will do. Were there any efforts by the government or the official opposition party to put anything concrete in the bill? Heavens no. We do not want to interfere with the entrepreneurial spirit. We do not want to interfere with the opportunity for Air Canada to make a buck.
Meanwhile the comments made by my colleague from the alliance party shocked me. I think it is the first time she said it. I listened to her talk about protecting workers, protecting small communities and maintaining service, but she supported nothing in the legislation that would have done those things. I actually heard that colleague make a statement that will probably go down in Canada's history. She said that we have to deal with more than the economic issue. Quite frankly, I think she said it just for the sake of saying it because she wants to put it in a householder or a ten percenter that will head out west where they will lose a pile of jobs and where Canadian regional employees will not get the same benefits as other employees.
The bottom line is that Canada's airline industry is vital to the economic and social well-being of hundreds of communities across Canada. That reality goes beyond the concerns of airline shareholders who focus mainly on the bottom line.
There certainly are some things in the bill with which I agree. There is no question. There is no question that we need to have legislation in place, especially in the situation with a monopoly carrier.
I have one area of concern with regard to new carriers coming into business. We extended the length of time that carriers would have to give notice. We okayed it as a committee to go to 120 days. There was concern that it would hinder new entrants. Nobody argued with the fact that we did not want to hinder new entrants. The NDP does not want to hinder new entrants coming in. We recognize that when we want to try out markets we need some time. The additional changes that went into the legislation now before us such as the 120 day extension to apply to new carriers is an excellent move. It will give some opportunity for competition.
I was pleased to see something happen in the area of an ombudsman; however, I am not thrilled with the fact that it is termed a temporary complaints commissioner. For the benefit of the minister, I have to admit that I am pleased the position will fall under the auspices of the Canadian Transportation Agency. However, I wonder about the credibility of how that person will be seen when it is termed a temporary complaints commissioner.
The complaints we were hearing were not minor little complaints; people had serious concerns about the way they were being treated within the airline industry in Canada. I do not consider them to be temporary little complaints. Quite frankly, it would be great if the complaints would end and we had a system that operated smoothly. My guess is that we will probably just leave it all to the monopoly carrier appointed ombudsman to look after all of the little complaints and we will shuffle them off.
The bottom line is that it would be great if it were operating so efficiently that the temporary airlines commissioner would not be needed. That would be wonderful. However, I am not convinced that the complaints will end, especially if the indication we have as to how things will operate is what Mr. Milton has been indicating.
My committee colleagues are great. To the benefit of them all, the majority of them spent a lot of time on committee matters. They listened to witnesses. They asked good questions of the witnesses. Quite frankly, the comments I heard from my colleagues were not the same as the bottom line that came down on paper. There were concerns about the labour issues, the ombudsman and price gouging. What was the final result? Let us give it six months and see if we need to review it.
There was this horrible person we have been dealing with. Let us face it, there is one thing we can credit Mr. Milton for. A survey was done a number of years ago that asked Canadians who they least trusted. Lawyers and politicians were at the top of the list. The only one who is probably least trusted now is Robert Milton, so we should give him credit for that at least. Through all the discussion on the airline merger he made promises that no workers would lose their jobs. I heard him promise Canadian Airlines employees that everything would come together and there would be a smooth transition. Everything would be done for them. What we have listened to is nothing but problems with Robert Milton.
What will we do with this legislation? We will hit him with a wet noodle. That is all this legislation will do to Robert Milton. If I am wrong, so be it. I hope I am. I hope and pray that something in this legislation, between the CTA and the Competition Bureau, will come together, but it does not appear that way.
We were worried about price gouging. Everybody complained. We heard of a situation on the Hamilton-Moncton route. It was just horrible what he had done. My goodness, the legislation is not even there yet. He does not even have the full rein and already he is doing these things. Will nobody bother to put in place something to stop him? We will wait six months and review it. That is disappointing.
I honestly had hoped that my colleague from Winnipeg—Transcona would be around to hear this. Prior to question period we were having a discussion on some of the amendments, one of which concerned the 25% foreign ownership limit. We agreed that we did not want to delay the bill. We were not necessarily happy as a caucus allowing things to pass on division, but we accepted the reasonableness. We did not want to delay the bill. We want to get things moving.
My colleague from Winnipeg—Transcona said that the Minister of Transport really is committed to the 25% foreign ownership limit. The minister stood here and said that absolutely we are not going to increase it. Had my colleague from Winnipeg—Transcona been able just a short while after question period to listen to the minister's comments, he would have heard him say that if we do not get competition we will raise it. It did not take all of two hours before it happened.
I am not convinced that there is a real commitment not to raise the foreign ownership regulation. Again, this would be one of those times when I would be happy to say “This is great. It worked. It is not going to happen”, but I am not totally convinced.
It is important to note the things that are not in the legislation. As I mentioned, the legislation deals only with particular things and not necessarily everything that came up as a concern. The committee heard the concerns of the labour force. The legislation was not able to address any of the labour related issues. The legislation does not deal with how to bring the two working groups together. Again, we had thought that Mr. Milton would be very magnanimous. Quite frankly, we know that is not the case. I would hope that we would go beyond all the talk in committee and make sure that something is put in place so that we see the swift resolve of the labour issues. Otherwise we will be dealing with an airline industry in constant crisis.
If the labour issue is related to seniority, which everyone recognizes is the key issue to be dealt with, that is not being dealt with. Even if agreements have been reached, the issue of seniority has not been dealt with. It will be left to negotiations a couple of years down the road. As far as I am concerned, that does not address the problem, which is a result of this legislation and a result of a monopoly. It is being delayed for someone else. That is what is happening with that issue.
I would hope that we could assure the employees of Canadian Airlines and Air Canada, and any others who might be affected, that if there are issues as a result of this merger they will be given consideration and that there are persons within the Canadian Industrial Relations Board designated to deal with this swiftly so that it does not become a continuing crisis in the airline industry.
There is nothing in the bill to address the very serious issue related to this monopoly carrier and the merger; that is, the issue related to employees. None of us wanted to see either side, whether it be Canadian Airlines or Air Canada, lose out. I would hope that no one on the committee saw one side or the other as having enough, even though Air Canada ended up being the owner. I would hope no one saw that. It certainly was not what was indicated to us by Mr. Milton or any other parties involved. There was an acceptance that these two companies would come together and the workers would be protected on equal terms.
I do not think the bill gives protection to small and medium size communities. There will be rules in place for a couple of years, which could be extended, but I do not plan to leave my small community in three years. I do not know how many other Canadians do. There are a lot of Canadians who want to know that they will have service for quite a long time. They want there to be some obligation for a carrier which is given a monopoly route, or other companies which have advantages to fly within Canada, to provide services to those communities. The bill certainly falls short of doing that.
The other area which is notably missing concerns a passengers bill of rights. I recognize that falls outside the scope of the bill and would probably be best dealt with another way, but I want to make a point of mentioning it because it was an issue put forward by witnesses at committee on numerous occasions. The key players in our airline industry, the passengers, are the forgotten ones. It is like the airlines are saying “We just want your money. Go ahead and complain, but we do not necessarily want you to have the right to some of these things”.
The key things which passengers had concerns about were flights being cancelled without notice; people getting to the airport only to find they were on a totally different plane; or getting on the plane after waiting an hour, perhaps due to a delay, which we can all accept happens due to mechanical reasons or the weather. Passengers can accept that, but they want to know as soon as possible how long the delay will be and when they will be able to get going. Often they want to know what the delay is for, for their own comfort.
How many times have members of the House boarded a plane after waiting an hour or an hour and a half and no sooner does the plane back away from the gate we are left waiting another hour on the tarmac? We are hostages on the plane. We cannot go back. That is a serious concern for passengers. Those are just some of the issues that come up.
Even though it seems as if this should be something we could deal with in the bill, I want Canadians to know that I recognize it is outside the scope of the bill. We have had discussions with the people who wrote the legislation. We have to look at other ways of addressing those concerns and go at it from a different angle.
We should have ensured that there would be protection for all regions of Canada and that service would be provided. I am not convinced that will happen. Again, this may play out one way or the other in the end.
I felt that Air Canada having to divest itself of Canadian Regional was not a good thing. I know that in a lot of those smaller and medium size communities Canadian Regional was often the other carrier, but Canadian Regional was often the only jet. I am not convinced that any carrier buying in will be able to continue service. I am greatly concerned that those communities will have no jet service.
The Minister of Transport reflected on the fact that small and medium size communities do not have the best choice of service. He mentioned the Churchill area. I would hate to think that air carriers in my riding are giving the perception that there is no service.
I live in Thompson and I know that we have better opportunities than some other areas. We are one of the larger centres in the Churchill riding. The carriers that go into that area, Canadian and Conair, as well as a lot of smaller carriers, have been excellent. Those carriers are not making huge profits. I would not want to risk that service simply because something cannot be worked out with another carrier.
On that note I will end. Again, I am not convinced that the bill will do the job.