Pat O'Brien

[Supply, November 15th, 1994]

Mr. Speaker, I guess I will not need much time to answer because frankly I did not hear a question. I heard some interesting comments from my colleague.

He touched on a number of issues and I will simply highlight one. He spoke about rail abandonment as something he is not anxious to see. Let me assure him that coming from southwestern Ontario as I do, coming from one of the most busy rail parts of Ontario, coming from the long and proud railway family that I do, neither my colleagues nor I are anxious to see willy-nilly rail abandonments either.

Unfortunately the sad fact of the matter is that there are rail lines in the country that make very little economic sense as they are currently structured. The minister is to be commended for seeking to rationalize the entire system because it is simply too expensive the way it is and common sense tells us that.

[Supply, November 15th, 1994]

Mr. Speaker, in addressing this motion today I would like to address the question of rationalization of the Canadian railway network, a matter of pressing interest to all Canadians.

Until recently rationalization meant only one thing, abandonment of rail lines and the loss of direct rail service to those shippers who still remain on the lines.

The rationalization options for railways and shippers have changed in recent years to include short lines and mergers. The fundamental realities, the factors which are driving railways to rationalize, have not changed; changing logistics patterns and requirements, continuing demands from shippers for reduced costs and improved services and competition from the trucking industry and U.S. railways.

The rail share of surface transportation markets has been steadily declining since the 1950s when trucking began to emerge as a serious competitor for rail services. Railways now hold less than a 40 per cent share of this market.

The direct consequence of this changing pattern of demand has been one of a gradual removal of those lines from the rail system that have seen traffic decline to the point at which the costs of continued operation of the lines far outweighed the revenues generated from the available traffic.

The traditional process of line abandonment has always been a traumatic experience for both communities and shippers. As a result, views on the viability of lines or their future prospects have been strongly held and voiced. Rail line abandonments have predominantly occurred east of the Manitoba border over the past 20 years, principally as a result of the fact that much of the rail network in the prairies is protected from abandonment until the year 2000.

However, it is also in the east that the greatest competitive in-roads into the railway's traffic base have been made by the trucking industry. I think of my own area of southwestern Ontario as being perhaps the best example of that fact.

Rail traffic in western Canada is largely bulk or resource based and less susceptible to truck competition, while traffic in eastern Canada has a much higher manufactured goods component which is strongly truck competitive.

In recent years intermodal traffic has come to be the highest traffic growth area for railways. However, intermodal traffic, particularly that in the shorter distance intermodal markets in eastern Canada, is highly truck competitive. Again I would cite the area of southwestern Ontario as an excellent example of that.

While rail line abandonment may have been the traditional means of rationalization, it is by no means the only method by which class one rail carriers can streamline their systems. Other alternatives include selling off so-called short line railways to new, lower cost operators, co-production which involves the consolidation of traffic from the lines of two parallel railways on to one of the lines and abandoning or short lining the redundant line, or merger and acquisitions.

Following the introductions of the Staggers Rail Act in the United States in 1980, American railways accelerated the process of rationalizing their systems. In some cases lines were abandoned although in many other cases rail lines were sold to other operators, producing explosive growth and what came to be known as the short line rail industry.

The term short line is quite broad and can cover railways ranging in size from mere spurs to extensive regional networks. In general terms short line railways feed traffic to larger, usually class 1 railways, have a lower cost structure than larger railways since their labour requirements and arrangements differ substantially from those found on larger railways, and offer services which are much more responsive to local needs.

The short line industry in the United States can be generally characterized as successful. The failure rate of short line railways is much lower than that experienced in other industries. This degree of success in the United States has not been lost on Canadian railways or potential short line operators in Canada.

Unfortunately while we have had some notable successes in Canada a domestic short line industry has been very slow in developing. Although the first Canadian short line, the Central Western Railway, emerged in western Canada, the majority since that time have been in eastern Canada. Again, one needs cite southwestern Ontario as a leading example of that fact.

Specifically the Goderich and Exeter railway in southern Ontario, some hour north of my own riding of London-Middlesex, is one of the premier examples of short line railways in Canada. Since its inception the Goderich and Exeter serving shippers along its line to Goderich, Ontario has succeeded in dramatically increasing traffic hauled by the railways and its revenues. The Goderich and Exeter was purchased from CN by a U.S. firm, Railtex, which owns some 20 other short line railways in the United States and more recently in Canada.

Railtex also recently purchased CN's Sydney-Truro line in Nova Scotia, renaming it the Cape Breton and Central Nova Scotia railway, and has embarked on a similar program of increasing traffic and revenues and generally improving the level of services afforded shippers.

One of the key features of short line railways is that their cost structure is lower than that for class 1 railways, principally because short lines have fewer employees and generally more flexible arrangements with their employees which result in significantly reduced labour costs. Typically short lines employ about 50 per cent of the labour that a class 1 railway operating the same line would have.

While one of the principal attractions of short line operations from the viewpoint of a potential operator has been the ability of short lines to structure their operations to make optional use of labour, several provinces have recently adopted legislation to ensure that labour successor rights would be preserved during the transfer of ownership of the rail line from federal to provincial jurisdiction since short lines have typically been formed within provincial jurisdiction.

British Columbia, Saskatchewan and Ontario have passed legislation which provides for labour successor rights when among other transactions ownership of rail lines passes from one jurisdiction to another. While B.C. has very few rail lines which could be considered to have short line potential and Saskatchewan's legislative changes are too new to assess the implications, several potential short line operators in my home province of Ontario have declined to pursue the purchase of short lines in this province in light of the changed situation.

Railtex in particular was negotiating with CN for the purchase of five additional short lines in Ontario. When the amended labour legislation was passed in Ontario Railtex immediately dropped the lines from further consideration. For all intents and purposes this legislation has stalled the development of a short line industry in this province, sad to say.

Despite early apprehensions and a lengthy Senate review of the proposal by Railtex to acquire CN's Sydney-Truro line the province of Nova Scotia now fully supports its short line industry. The second short line, the Windsor and Hantsport railway, recently began operations in the province after acquiring CP's Dominion Atlantic railway line.

New Brunswick, having recently adopted new short line legislation which could represent a model for others, is close to seeing its first short line development with the likely purchase of a portion of CP's Canadian Atlantic railway by the Irving Group. The line which has been ordered abandoned by the National Transportation Agency effective January 1, 1995 will likely be operated by Guilford Transportation Industries and provide service into New Brunswick and Maine.

Another company has recently expressed interest in acquiring the balance of the CP line to Sherbrooke, Quebec to add to its own rail network in Maine. Quebec for its part has been an advocate of the development of a short line industry in the province and has introduced legislation to support the development of this industry in Quebec.

In addition to being close to selling the line near Quebec City to a short line operator, CN has indicated that it wishes to sell a considerable number of its lines in northern Quebec and the Gaspé to potential short line operators. It is expected that CN will proceed soon with these transactions. CP has also offered its lines between Delson, Quebec, near Montreal, and Sherbrooke for sale.

What is clear is that our class 1 freight railways, CN and CP, not only have other alternatives than simply waiting for traffic on lines to decline to the point at which abandonment is the only possibility, but they are beginning to move more rapidly to spin-off short lines to potential operators while this makes good business sense for all partners.

This does not mean that rail abandonment will not be an option since a small number of lines in the east are unlikely to be attractive to even a short line operator with a more advantageous cost structure.

What it does mean is that rail line abandonment is much less likely, particularly where provincial governments are receptive to the development of a short line industry. While a small amount of trackage might end up being abandoned in any event, perhaps one-third of the current class one rail system, or almost 16,000 kilometres of line, would be attractive to potential short line operators. The resulting class one system would then closely resemble the high density, low cost U.S. rail systems.

Another alternative open to CN and CP is co-production, the consolidation of traffic from the lines of two parallel railways on to the line of one of the railways. Typically the redundant line would be abandoned, although there is always the possibility of short lining.

A current example of co-production is the Ottawa Valley Railway which has received National Transportation Agency approval for operation on CN and CP lines from a point near the Ontario-Quebec border to North Bay via Ottawa. Court challenges to the proposal are delaying its introduction. There are only a limited number of areas in Canada, however, mainly in Ontario, where co-production could be a possibility.

In closing, railway rationalization is not only inevitable, it is necessary. Pressures on CN and CP to reduce their costs mean they must adopt innovative, non-traditional means of responding to market signals. The key for railways is to find rationalization solutions that minimize costs to carriers and shippers while at the same time maximizing railway opportunities to achieve financial viability and shipper opportunities to maintain or enhance their access to competitive rail services.

[London Investment And Education Council, November 2nd, 1994]

Mr. Speaker, learning is a life long process and in a rapidly changing world our vision of learning must be constantly changing and evolving. I am proud to say that the city of London is developing into a learning community.

The London Investment and Education Council is a non-profit community based group committed to bringing together students, business, labour, government, families and social and cultural organizations to plan initiatives and share information related to education.

The federal government recognizes that learning is a life long process and encourages all sectors of our community to become involved in the learning process. London truly is a learning community, thanks to the innovative work of the London Investment and Education Council.

[Pipelines, October 25th, 1994]

Mr. Speaker, earlier this year an application was put before the National Energy Board to convert an aging oil pipeline that runs across southwestern Ontario to natural gas. A number of my constituents of London-Middlesex appeared before a hearing of the NEB to object to the potential environmental risks this conversion posed to their land.

In hearings such as this, property owners are up against large companies with unlimited resources to prepare their applications. Affected landowners have no choice but to spend their own money to cover legal fees and expenses in preparation for an NEB hearing.

In all fairness, access to intervener funding would ensure a more level playing field. I urge the government to amend the National Energy Board Act to provide the NEB with the authority to award intervener funding to landowners who are forced to intervene in such proceedings.

[Poverty, October 5th, 1994]

Mr. Speaker, children are this nation's most valuable resource and it is our responsibility to eliminate the poverty that creates barriers for 1.25 million Canadian children. Lack of food is affecting their growth, health and ability to learn and has led to an increasing number of young people resorting to crime and suicide to escape poor living conditions.

In London-Middlesex the three levels of government, the school boards, businesses and community organizations have come together to form the kids count program, an innovative project aimed at breaking the cycle of poverty that hinders a child's development. I commend this community-wide co-operation that seeks to give every child the opportunity to do his or her best.

The government is committed to the elimination of child poverty through job creation and the reformation of our social security system.

[Autumn Fairs, September 29th, 1994]

Mr. Speaker, as the colours of the country's landscape begin to change and farmers begin to harvest their crops, the annual fall fairs are now in full swing. The fair is a longstanding tradition in Canadian communities where families, friends and neighbours come together to celebrate the autumn season.

In my riding of London-Middlesex I have had the opportunity to attend and participate in the Dorchester Fair; the Thorndale Fall Fair; the Lambeth Harvest Festival; the Iderton Fair; and southwestern Ontario's largest, the Western Fair.

Tremendous community spirit and long hours of hard work make these fairs memorable events enjoyed by both my rural and urban constituents alike.

Congratulations to all the dedicated people in London-Middlesex who worked so hard to make fairs the great success they are.

[Department Of Industry Act, September 26th, 1994]

Mr. Speaker, I was not elected to come to this House to speak exclusively for the views of Ontario, let alone the views of the province of Quebec. That may be the agenda of my friend and his colleagues in the Bloc Quebecois but it is not the agenda of the only truly national party in the House of Commons.

While I understand my colleague's concerns for the people of Quebec and while I understand his preoccupation with manpower training, I can only assure him that the government is equally concerned in making sure that all Quebecers understand. We did not get to be the best country in the world by not addressing all the concerns of Canadians. We will continue to do that, including all the people of Quebec.

[Department Of Industry Act, September 26th, 1994]

Mr. Speaker, it is a pleasure to receive a question from the hon. member. I would say in response to his first comment that I am reminded of the statement that if the shoe fits, wear it. I challenge my friend to find in Hansard or even in the ``blues'' which will be out shortly that I named the Reform Party as saying that governments should do nothing.

What I said was that some hon. members opposite-there are at least four political philosophies opposite-quite often espouse the idea that government must get out of the way, that it has no role to play. However, if my friend finds that my comments were appropriate to the philosophy of the Reform Party, I will not disagree with him.

On his question of the focus of spending and social services, I agree that we need to focus spending on social services. Where I differ with my friend and his party, as I understand their philosophy, is we will never eliminate the universality of our programs. The minute you start to say that targeting means we will eliminate universality we will start to fool with the other underpinnings of our social security system and the whole thing is in risk of collapsing. We have to focus it and keep it fair and available to all Canadians who need it without going to the far extreme.

[Department Of Industry Act, September 26th, 1994]

Mr. Speaker, I am pleased to join in the debate on the reorganization of the department of industry, Bill C-46.

I would like to take a moment to reflect on the nature of my riding of London-Middlesex and illustrate just how important the activities of the department are to my constituents.

This area of small and medium sized business is a part of Ontario which is a leader in southwestern Ontario in that economic activity. Whether it is a business that is a spinoff of the automotive industry or whether it is the agri-food industry, London-Middlesex is one of the busiest areas of southwestern Ontario. It is a satellite of the agri-food industry in Middlesex county, one of the most productive agricultural counties in our part of Canada.

There is a very wide variety of small and medium size business activities in the riding of London-Middlesex so the constituents are very interested in the proposed reorganization.

As well I am pleased to represent a number of major corporations of national and international repute: General Motors Diesel of Canada, 3M Corporation and Cuddy Foods, to mention only three. In mentioning these three corporations one can easily recognize the scope of activities which take place in the riding of London-Middlesex. I say again it is with great interest my constituents hear of the proposed changes and await the reorganization of the department of industry.

It is all too obvious that we have had an erosion of the Canadian economy. We know that on all sides of the House. We hear it daily. As well we should, because Canadians have a right to expect these important issues will be aired.

The so-called corporate downsizing that has been taking place as part of global reorganization has caused a job crisis of major proportions in the country. Frankly my constituents feel the previous government was the government of the big corporations. It put all its eggs in that basket and now Canadians have paid the price in the last few years for that foolish approach to government.

All too often small and medium sized businesses were ignored. This is simply the wrong way to go if we are going to pull out of this economic crisis.

People well know the unemployment numbers and all too often we can disregard them as statistics. Day after day in my riding office like hon. members in all parts of the House I have seen the human face of unemployment, men and women young and old alike, highly educated and well trained, and those untrained and unskilled. Day after day the human face of unemployment has come into my riding office crying for some kind of help from the government. As a member of Parliament you wish you had a magic phone that you could pick up and instantly produce a job.

This contact has served to reinforce the real need to concentrate on small and medium sized business. That is how we will get Canadians working again, not by following the agenda of the previous Tory government which all too often ignored these sectors of the economy and simply focused on corporate Canada.

Canadians well know that we have been living beyond our means and that certainly includes government. Government has been part of the problem and it is high time we became part of the solution.

No party in the House has a monopoly on knowing that the debt and deficit are major preoccupations of the citizens of Canada. If anyone listens even a little bit to the concerns of Canadians he or she knows it is right at the top of the list of

concerns. Indeed it dominated, as well it should, much of the debate in the last federal election a year ago.

One problem that needs to be addressed is the fact that so much of our debt is in the hands of foreigners. I was amazed in the campaign to not have this recognized by some of the opposition candidates. They simply felt debt was debt and that was all there was to it. Would that it were that simple, but it simply is not. It is a grave concern that so much of our indebtedness as a nation is to foreign nationals.

The Liberal commitment in the red book and during the election campaign, endorsed from coast to coast to coast by Canadians, was a sensible, gradual approach to the reduction of the deficit to no more than 3 per cent of GDP by the end of our first term and then total elimination is the ultimate goal of the government.

I heard a member opposite-I do not recall exactly who now-propose that somehow the government was going to lock in 3 per cent as its overall target and that simply is incorrect. My colleagues and I have heard time and again the hon. Minister of Finance speak to the fact that this is the interim goal of the Liberal government and that the ultimate goal would be to completely pull out of an indebtedness situation.

How will we achieve such a goal? Obviously the first step is to reduce government spending. The right hon. Prime Minister has shown outstanding leadership in that regard in the few short months he has been the Prime Minister. He started with the size of the cabinet and scaled it away back from what was the situation previously. He also scaled back the size of ministerial offices.

Perhaps huge amounts of money have not been saved but they are not insignificant millions either. However they set a tone that the government is prepared to lead by example in reducing spending.

Concomitant with that is the need to encourage new jobs. If we are really going to pull out of the economic problems we face as a country we must get Canadians back to work. We must get them off the tax rolls and change them into taxpayers because they now have a meaningful and well-paying job.

This two-pronged approach of the Liberal government was endorsed nationally in the last federal election campaign. I am proud to be a member who is helping to advance that agenda.

It was no mean consideration recently when London, Ontario was awarded the Institute of Advanced Manufacturing Technology. This will be a very important organization to London and to southwestern Ontario. It will help co-ordinate the activities of the private sector, of the University of Western Ontario in London, of the city council and indeed of the surrounding areas of southwestern Ontario with the federal government. This is the kind of partnership that is necessary if we are to move forward into the new economy and start to get Canadians working again.

The question needs to be posed: What is the proper role of government in this new economy? One only needs to reflect to know that there are several shades of opinion on this question. From some parts of the House we hear the socialist point of view that the government should do everything. The government should run the economy, it should own it, and there is no place for the private sector because all it will do is hoard the profits. I reject that view. Liberals reject that view.

Equally we have the view at the far right which says that governments should do nothing, that there is no place for government. It is the other extreme. I equally and even more forcefully reject that view. One might say that in this House today we have perhaps the most conservative of the conservatives with the view that there really is no role to be played by government.

I hope that no one party embraces that philosophy but I hear that view from certain members opposite so often I have become concerned. Surely they cannot feel there is no role for government in running the economy of this nation. To the contrary the Liberal view is that there must be a balanced approach.

There must be and there is a role for government to play in partnership with the private sector. The private sector is the engine, as it must be, but there will be a positive role for government to play in creating the proper environment for the private sector to succeed. Only a balanced common sense approach best enunciated by the Liberal Party throughout the history of this country will ensure fair and equitable treatment in our economy.

I see that my time is coming to an end. I would simply say that as a member of the Liberal Party it will be my pleasure to do everything possible to help advance a balanced approach to this economic situation.

[Take Back The Night, September 22nd, 1994]

Mr. Speaker, fear of violence and violence itself is a severe restriction to equality for women. This sad reality of our society sees women and children at risk of danger in many situations, including the most fundamental action of walking safely after dark.

The federal government is committed to addressing the widespread problem of violence against women by working in partnership with local communities to find solutions. I send my support to the London group, Women for Action, Accountability and Against Violence Everywhere, and to all women as they march to bring an end to violence in the Take Back the Night rallies happening this week across the country.

I encourage Canadians to get out and support the right of women to walk freely within our communities.