Madam Speaker, after two years and much work by many people, I have the privilege to speak to third reading of Bill C-44, the new Canada marine act.
This is important legislation for Canada's transportation system because it gives a new outlook and direction for many of our key marine institutions and facilities.
The core idea of the legislation is to make it easier for marine facilities of all sorts to operate according to business principles. That is why ports will have to work within market based decisions about when and how new investments will be made. That is why we will allow for the seaway to be managed under new commercial agreements. That is why we will ensure that pilotage authorities will have to achieve full cost recovery in their operations without any backstop through the public treasury.
The bill also takes important steps to make sure that key plans and decisions are taken much closer to the people who are most directly affected by the results, who include the users of the facilities, the adjacent communities and other interests.
That is why the nominations to port boards will have so much more local input. That is why ports will have a system of land use plans and substantial disclosure responsibilities regarding their operations. That is why the divestiture program for public ports is moving ahead so smoothly. That is why we have authority for Marine Atlantic to divest services where they can be local operators.
Even for a bill with all of these fine qualities, the standing committee was able to bring in a substantial number of improvements after listening to a wide range of comments from all parties concerned.
In his wisdom, the hon. member for Windsor West, our House leader, saw an opportunity to maximize the individual member's legislative authority here in the House. He moved quickly to transfer Bill C-44 to the Standing Committee on Transport so that members could engage their energies in the construction of legislation and improvements pursuant to testimony and consultation sought from and given by a broad and profound range of concerned citizens, both private and corporate.
Ordinary members from the Reform Party, the Bloc, the New Democratic Party and the government constructed Bill C-44. It is a members' bill. It is a good bill. I thank the hon. member for Windsor West and look forward to seeing more bills moved to committee from first reading. He would be proud to see that most members' initiatives appear in the bill without alteration, which is a testament to the diligence and insight of the committee.
The additional amendments made at report stage look like a lot of change. In reality, however, most of what we have done has been a fine tuning of two aspects of the new arrangements for port authorities.
At the standing committee it was requested that Transport Canada take a closer look at the treatment of subsidiaries under the new arrangements for port authorities. This was done and a small group of amendments has been included to cover this area.
The government also took time to look carefully at what results would flow from the largest change introduced by the standing committee to give crown agent status to the new port authorities. Why was the amendment on agent status so important that all committee members supported it? There are several reasons.
The ports need to have more certainty that they will be protected from provincial and federal taxation.
With Bill C-44 we want to provide the right climate and conditions to allow the ports to operate more efficiently and, as a result, to be more competitive, especially with American ports which, as we all know, continue to receive substantial public subsidies.
Without agent status the ports would have to make either arrangements with municipalities for services or, if that is not acceptable to the municipalities, they could become subject to full taxation. Costly challenges for both ports and municipalities could be the result of this ambiguity.
Crown agent status gives port authorities a clear exemption from full property taxation and would enable them to be covered by the Municipal Grants Act. As such they will pay grants in lieu of taxes to those municipalities at the same levels as other federal facilities and installations around the country. This is the more acceptable option to both the ports and the municipalities as it provides certainty for both parties. For most of the ports that will become CPAs this represents a continuation of the status quo.
For the most part new obligations from agent status would come mainly to the federal government as principal and not to the agent. That is why we have amendments that clarify what restraints should exist for the agent. Part of this was to have agent status apply only to core responsibilities of the ports, not to other more peripheral or non-core activities which they might be able to undertake.
This is how we are able to protect the overall commercialization objective. We say in the new amendments that any borrowing by a port authority will not be done as a crown agent. That is consistent with the provision already in the bill that port debts could not be paid by the treasury and nor could loans be guaranteed.
Once this idea of a split was in place we also had to say how the split would be specified for all to see. Since the bill already contained the letters patent method for setting up the new port authorities, we only needed to clarify that this split would be set out in the letters patent. To make sure that outsiders would know when they are dealing with an agent, the amendments obliged the
port authority to make this declaration in all their non-agent dealings with third parties. Even before agent status was added we put measures into the bill to protect the crown from liabilities of the ports and to ensure that they are accountable.
Because of the new relationship created by agent status, we now have some additional points to deal with liability issues. Perhaps the most important accountability mechanism in the bill stems from the fact that the ports will have to raise their financing in the private sector. Port development aspirations will be subjected to assessments of commercial risk by commercial lenders.
The act would forbid the use of appropriations to make certain kinds of payments to port authorities or their wholly owned subsidiaries. This means they have to be more efficient than they are today and to a significant extent the government, the Canadian taxpayer, will not be on a hook for their liability.
Canada port authorities will have a high degree of transparency through rigorous disclosure to the public. Bill C-44 requires each port authority to provide public financing reports, public audits, a public land use plan, an annual general meeting open to the public at which directors and senior officers are available to answer any and all questions, complete disclosure of remuneration and expenses of board members and details of port operating expenses.
Ports are now covered under the Access to Information Act which further strengthens their accountability to all stakeholders. We have taken measures to ensure that ports must borrow in their own names and not in the name of the crown to emphasize to lenders that the crown does not stand behind these obligations.
In finishing its work before it reported the bill, the standing committee asked that an up to date schedule be placed at the end before it was put forward for second reading. This too has been done with the result that we are now looking at several additional ports.
I would be remiss to talk only about the future of port authorities under the bill. It has important features for public ports, the seaway, our pilotage authorities and the ferry services of Marine Atlantic Incorporated.
I will outline where we are in this bill regarding the seaway. I believe the key to the future viability of the seaway lies in achieving efficiencies, reducing costs and making the system more competitive. If the system has lower costs it can be viable at relatively low traffic levels. It is also well placed to attract additional traffic.
I am firmly of the view that commercialization of the seaway is the best way to achieve the efficiencies and cost savings which are vital to the future viability of the seaway system. Part III of the Canada Marine Act enables the Minister of Transport to enter into agreements with a not for profit corporation to operate and maintain all or part of the seaway. Amendments made by the standing committee also allow for future operations to be transferred to any body that might be established through international agreement.
The St. Lawrence seaway authority is obliged to transfer at the direction of the minister any parts of its assets that are required for the new arrangement. The existing seaway authority would be dissolved at an appropriate date.
Any entity which has entered into an agreement with the minister to operate the seaway is obliged to have a high degree of transparency through annual public meetings and annual public financial statements. Special examinations of seaway operations and financial results will be carried at least once every five years.
The proposed legislation also prohibits unjust discrimination by the seaway operator that places any user of the seaway at a disadvantage. This ensures fair access to all users with no undue preference for those who take a role in the company that runs the seaway.
On July 15, 1996 the Minister of Transport signed a letter of intent with a group representing the major shippers and carriers on the seaway. The target is for these users to form a not for profit corporation to take on the operations of the seaway. The government would retain title to the seaway's fixed assets.
The goal of this commercialization is to give the operators strong incentives to increase efficiency and reduce costs.
We believe that the users group is best placed to take over the system, as users are highly motivated by a desire to minimize the seaway tolls they pay and to ensure the long term integrity of the system. The industries represented, particularly the steel industry in my hometown of Hamilton and the marine carriers, need the seaway for their long term survival. A deal with the users group would place the seaway well on the road the ongoing self sufficiency.
Let me assure all hon. members that I am confident of the future success of the seaway. It has been an essential component of our national transportation infrastructure in the past and we will do everything in our power to ensure that it remains as a revitalized national asset and becomes a more efficient and competitive link with our international trading partners.
We now have a balanced, well though out piece of legislation, one that will move Canada's marine industries confidently into the new century. I urge all hon. members to support the amended bill.
