Lawrence Toet

[Fair Rail Freight Service Act, May 23rd, 2013]

Mr. Speaker, it is refreshing to hear somebody from the NDP talking about resource development being necessary in this country, because so often NDP members stand in the House and say that we should not develop anything and should shut down all resource development. It is refreshing at least to hear that they have a desire to have resource development in our country. We hope they will get on board with some of our resource development initiatives.

It is also important to remember that the railways are an essential service. That is why the government did a review. We looked at the report and the review very closely and came up with a solution that serves the railways so that they can continue to serve all shippers across the country.

This legislation always has been considered as a backstop. We would love to see no arbitration cases ever come out of the legislation. We have now given an incentive and a little more strength to the shippers to be able to go to the railways and negotiate commercial solutions and commercial service level agreements. That is ultimately the goal of the legislation.

I believe very strongly it will deliver on that goal and I look forward to seeing the bill passed by this House and moved to the other House very quickly.

[Fair Rail Freight Service Act, May 23rd, 2013]

Mr. Speaker, the hon. member's comments about our having preconceived notions is completely false. As a member of the committee, she would know that we ask many tough questions of both the shippers and the railways in asking them to back up their requests for amendments.

We talked very closely about many of the considerations they brought forward, and we addressed them specifically in committee with the witnesses who came before us.

One of the specific examples was the desire of the shippers to have the network not be looked at as part of the arbitration process. They did not want the arbitrator to look at the whole network as part of the process. If we do not look at the whole network and we tell the shippers that the rail freight company only has to look at their particular issue and does not have to worry about the big picture of shifting freight across Canada for multiple shippers but just their particular issue, we would have a situation in which a shipper would be tying up the resources of the railway for an undetermined and unlimited amount of time and affecting other shippers because they would not be able to get their goods to market.

Would it be fair that one shipper could basically hold many other shippers across Canada hostage? It is wrong, and it could be a complete collapse of the network if we allowed that to happen. That is one example in which we listened very closely and closely questioned the witnesses who appeared. We closely questioned the shippers.

We did go through a deliberate process. We looked very closely at the request for amendments, and we determined that those amendment requests were actually contrary to what they were trying to accomplish, and were actually even dangerous for themselves in many items. That was also pointed out very clearly by Transport Canada officials. It was one of those situations in which they needed to be aware of what they were asking for, because they might not be getting what they thought they were getting.

[Fair Rail Freight Service Act, May 23rd, 2013]

Mr. Speaker, the administrative monetary penalty in this bill is actually quite significant, because it is not a one-time $100,000 penalty. The administrative penalty could be applied many times over the course of a service level agreement if the railway did not fulfill its obligations.

It is also important to note that this particular act, and I spoke of this, would not take away the ability for a shipper to go through the normal court process if it feels that a service level agreement has not been fulfilled and that has incurred financial costs. The shipper would still have the ability to go through the courts to seek a finding to force the railway companies to pay those final bills.

[Fair Rail Freight Service Act, May 23rd, 2013]

Mr. Speaker, I am pleased to speak today in support of Bill C-52, fair rail freight service act.

Before I begin, I would like to thank the hon. Minister of Transport, Infrastructure and Communities for his tremendous leadership on this particular issue. I would also like to thank the members of the Standing Committee on Transport, Infrastructure and Communities, who have recently concluded a comprehensive study of Bill C-52 and referred it back to this House.

The committee held hearings for the past two and a half months, hearing from dozens of witnesses: from the shippers representing the agriculture, mining, forestry and chemical industries, to the railways—CN, CP, the Railway Association of Canada and the short lines—as well as other important supply chain partners such as the Canadian port authorities. I am very pleased that the committee has examined this legislation so thoroughly and carefully considered all of the various issues.

Our government remains focused on creating jobs, economic growth and long-term prosperity, and that is what Bill C-52 is all about.

Transportation plays a major role in supporting our government's economic agenda. It drives and attracts international trade, which makes it essential to ensuring Canada's economic competitiveness in the world. As this House knows, after years of neglect by the previous Liberal government, in 2008 our Conservative government launched the rail freight service review to get an accurate picture of how well the rail freight transportation system was working.

The review panel recommended commercial solutions to address service issues, with legislation to be used as a backstop if necessary. In response, our government committed in March 2011 to table a bill on rail freight service, and Bill C-52 delivers on that promise.

The fair rail freight service act would strongly deliver for shippers by giving them more leverage to negotiate service level agreements with the railways. This would expand the clarity, predictability and reliability they need to succeed in global markets.

This bill would amend the Canada Transportation Act to give shippers the right to request a service level agreement from a rail company. In the event that rail companies and shippers were unable to reach an agreement on their own, the bill would create an arbitration process to establish the terms of service that a shipper is entitled to receive from the railway.

Bill C-52 would grant the arbitrator the power to define, in a forward-looking manner, the railway's service obligations for a specific shipper. The arbitrator's decision would be backed by very strong enforcement tools to ensure compliance by the railways. In addition to the existing enforcement tools that already exist in the Canada Transportation Act, Bill C-52 proposes to give the Canadian Transportation Agency the power to impose administrative monetary penalties on railways to hold them accountable for their service obligations.

During second reading, some of my opposition colleagues across the way raised some concerns about the bill that I would like to address.

First, there were questions regarding the ability of shippers to trigger the arbitration process. Bill C-52 is very clear that the shipper would trigger the arbitration process, not the railway, and the threshold to access arbitration would be quite low. To begin the process, a shipper would only need to demonstrate to the Canadian Transportation Agency that an effort had been made to reach a service level agreement commercially and that a 15-day notice had been served on the railway prior to the arbitration request. Then the shipper would present to the agency the issues he or she would like resolved and ask that these be referred to arbitration. In short, the shipper would get to frame the issues that were submitted for arbitration.

Second, some opposition members raised concerns that the level of the administrative monetary penalty would be too low. The level of the penalty would be significant: up to $100,000 per violation per arbitrated service level agreement. This amount is four times the level of other administrative monetary penalties in the act. If a railway had multiple violations, it could be fined many multiples of $100,000. This would be a very strong enforcement tool.

I would also like to speak on issues raised at committee hearings. As I mentioned earlier, during the hearings on Bill C-52, the Standing Committee on Transport, Infrastructure and Communities heard testimony from everyone wanting to share their views on Bill C-52: shippers, railways, ports and many associations that lobby for rail freight shipping in Canada. Overall, it is clear that shippers support Bill C-52. They overwhelmingly said that this legislation would give them more leverage in their negotiations with the railways.

There were some concerns raised by my opposition colleagues at committee, which I would also like to address. Some questioned whether force majeure clauses and performance metrics are captured in the scope of what an arbitrator could impose in a service level agreement. Transport Canada officials testified before the committee and made it very clear that both force majeure and performance metrics are included in the bill.

The shippers suggested some amendments that the committee ultimately judged, after careful consideration, as unacceptable. There were two reasons for this. First, many of the amendments were contrary to the approach to arbitration in Bill C-52, which would give the arbitrator broad discretion to impose the right service contract for a particular situation, in recognition of the fact that each situation is different and there is no one-size-fits-all solution. It is important for the House to understand that legislation is a very blunt instrument and rail freight service issues are often extremely complex. Therefore it is essential to ensure the arbitrator would have enough flexibility to impose a service contract that made sense, given the unique circumstances of each case. For example, shippers asked for changes to the level of service provision that would prescribe detailed service obligations for railways. This would limit the arbitrator's ability to consider the circumstances of each shipper and establish service agreements on a case-by-case basis. Under Bill C-52, the arbitrator would still be able to include every service element a shipper could ask for.

Second, some of the shipper amendments were not possible because of inherent legal risks associated with the proposals, which in some cases would be unprecedented concepts in Canadian law. The committee examined this very carefully. The shippers sought amendments to give the arbitrator the ability to impose pre-established damages or penalties that the railway would pay in the event of a hypothetical service breach in the future. This concept is not consistent with the way damages are handled in contractual law and it is not consistent with the role of regulatory agencies, which is to enforce compliance after an actual breach, not before a potential breach. It is also full of legal risks and would limit the ability of shippers to seek actual damages in court after a service breach.

Also, shippers asked that the arbitrator not take into account the railway's obligation to other shippers and users of the network. It is very clear that the way a railway serves one shipper will affect the service to another. That is the nature of the railway business. It would be completely irresponsible for the arbitrator to be denied the ability to consider the railway's network and its service obligations to other shippers. Such a proposal could have devastating consequences for our entire rail freight system, harming all shippers and threatening our economy. This is why it is important for Bill C-52 to require the arbitrator to consider the rail network and the railway's obligation to other shippers.

The railways strongly maintain that the bill is not required, given recent improvements to rail service. They warned about unintended consequences of regulation and the potential negative effects of government intervention on the efficiency of the supply chain. They are opposed to the entire premise of this legislation.

That said, the railways also requested amendments at committee stage, which were carefully considered. Ultimately, their amendments were also determined to be unnecessary. For example, the railways proposed to limit access to arbitration to only captive shippers, those that have no alternative means of transporting their goods. This amendment would unduly restrict access to service arbitration for shippers, reduce shippers' ability to establish service terms in a timely manner to address their business needs and conflict with existing shipper protection clauses in the act that are available for all shippers.

The railways also proposed an amendment to completely eliminate the administrative monetary penalties provision in Bill C-52. Again, this proposed amendment was rejected by the committee because it is important to ensure that the Canadian Transportation Agency would have a strong enforcement tool to force the railways to comply with the arbitrated service level agreements if necessary.

The testimony heard at committee clearly demonstrated the extent to which shippers and railways have very different perspectives on these issues. This underscores the need for Parliament to assess their proposals with a view to ensuring that the fair rail freight service act would maintain its original focus, which would be to ensure that shippers would have the leverage they need to secure service level agreements from the railways, but do it in a way that would not undermine the efficiency and performance of the rail transportation system as a whole. Bill C-52 would do exactly that. It would support shippers' needs for commercially negotiated service agreements and would provide a legislative backstop if those negotiations were to fail. I believe the bill would strike the right balance for our entire Canadian economy.

I also would like to speak to those benefits to the economy. By working together, Canada's railways, farmers and many others who harvest and ship our natural resources have helped to build our great country. Beyond their own businesses, they drive economic growth and create jobs right across Canada. However, those in agriculture and resource production depend on efficient, effective and reliable rail service to move their products to customers in Canada and around the world. For example, last year Canadian farms shipped more than $3 billion in agricultural products by rail. By ensuring more reliable shipping from gate to plate, as they say, Bill C-52 would help strengthen the livelihood of those who produce food in this country.

Before this legislation was tabled, the shippers asked the government to include three essential elements in the bill for it to be successful. They were, one, a right to a service level agreement with the railways; two, a process to establish a service level agreement when commercial negotiations fail; and three, consequences for non-performance on the part of the railways. I am proud to say that Bill C-52 would deliver all three of these elements.

The range of support for Bill C-52 is broad. Consider these comments:

The Coalition of Rail Shippers said, “Bill C-52 meets the fundamental requests of railway customers for commercial agreements”.

Greg Stewart of Sinclar Group Forest Products Ltd. told the committee on March 7, 2013, that the proposed legislation was “...a significant improvement and will reduce the risk” for shippers.

Jim Facette, CEO of the Canadian Propane Association, told the committee:

We believe this piece of legislation...provides a very good balance between railways and shippers. We're not coming today with any changes at all. Finding a balance is very, very difficult.... For us, it contains all the mechanisms and measures we requested some years ago: a right to a level of service agreement, an arbitration process, and administrative monetary penalties.

Mr. Facette also said that Bill C-52:

is viewed by the propane industry as a balanced approach to managing relations between railways and shippers, and the CPA urges Parliament to pass the legislation in a timely manner.

Also at committee, representatives from the ports expressed strong support for this bill. Mr. Peter Xotta, vice-president of planning and operations at Port Metro Vancouver, said:

...Bill C-52 is extremely important to Port Metro Vancouver.... Clearly, the establishment of service agreements through normal commercial processes should be encouraged, with arbitration as a last resort.

The Prince Rupert Port Authority noted that it:

...supports what we believe is the principal object of this piece of legislation, which is to ensure that there are agreements in place that provide clarity, transparency, and certainty both to shippers and to rail lines regarding the obligations of both parties in their roles in the supply chain.

The fair rail freight service act would help build a more prosperous economy. It would create a strong incentive for both shippers and railways to work together to negotiate service agreements commercially, and it would create a fast and efficient arbitration process if these negotiations were to fail to achieve the clarity and predictability that shippers need.

In conclusion, let me say to my colleagues in this House that we need to pass Bill C-52 as soon as possible to ensure that our rail system and Canada's economy are on the right track.

The proposed legislation would deliver significantly for shippers and would fulfill our government's promise to create a legislative backstop for fair rail freight service issues. However, well beyond the shippers, I would like to stress that the real winner would be the entire Canadian economy. By strengthening our agricultural and resource producers, the bill would build prosperity for many of the people we represent.

I call upon all members of the House to support Bill C-52, expedite its passage through the remaining parliamentary stages and refer it to the other place without delay.

[Youth of Elmwood—Transcona, May 1st, 2013]

Mr. Speaker, one of the great privileges of being a member of Parliament is the opportunity to speak with the youth of Canada.

In my riding of Elmwood—Transcona, I have visited many schools. During these visits, I have enjoyed lively discussions with students from very diverse backgrounds and who have different experiences with government officials in Canada and in other countries, yet all have an exceptional interest in this great country we call home.

It encourages me to hear how interested students are in our system of government. I had some great discussions today with students from the King's School in my riding, who have come to Ottawa this week to get a better understanding of how government works and to have conversations on the things that matter to them. Their investment in learning is imperative for our nation as we look ahead. We need to ensure we help them in their learning and equip them with the skills they need to move Canada forward.

The youth of Elmwood—Transcona are not only inspiring, but are demonstrating they will be ready to lead. It gives me great pleasure to applaud them for their resolve to make the world better for everyone.

[National Volunteer Week, April 25th, 2013]

Mr. Speaker, as we celebrate National Volunteer Week, I want to take this opportunity to thank the many volunteers in my riding of Elmwood—Transcona. From literacy groups, food banks and music programs for at-risk youth to community celebrations like Happy Days and the Hi Neighbour Festival, my constituents are always stepping forward to help make our community better for everyone. The spirit of volunteerism is thriving in Elmwood—Transcona, with some extra help from people like Barb Culbertson, Ken Butchart and Dr. David Marsh. These individuals, and many more, have given their time to help build playgrounds in the riding, plan major community celebrations and work with Rotary to help eradicate polio.

Volunteers are helping improve our communities each day. Whether it is in large or small ways, each are valued and appreciated. Thanks to their hard work and dedication, the lives of many are made better. These are just a few of the many examples of people in Elmwood—Transcona who are putting others before themselves. It is why we have much to celebrate and look forward to. It makes me proud, as their representative, to be able to recognize their commitment to community and to each other.

[Business of Supply, February 5th, 2013]

Mr. Speaker, Canadians should be excited that we have come to the point where, after the recession that we went through, the temporary measures that we had to bring forward in 2008 and renew in 2010 can be removed because we have had such a great economic recovery. We are heading in the right direction. Canadians can look at this with great pride and say that we have come a long way and we do not need these temporary measures any further.

[Business of Supply, February 5th, 2013]

Mr. Speaker, I mentioned the NDP policy that was clearly articulated in the budget proposals from that party's last election campaign. It is interesting that the member is trying to give us credit for what his party has clearly articulated and brought forward.

We want to have an atmosphere where we create jobs, where there is an opportunity for employers and entrepreneurs to go forward, to grow their businesses, to bring prosperity to this country. That is what will bring forward jobs for everyone. We want to help connect people with the jobs that these entrepreneurs are bringing forward. We do not want to bring forward measures that will set back our entrepreneurs, our small business people, from being able to continue growing in a fashion that would create jobs for Canadians, such as the 920,000 net new jobs that have been created already to this point since 2009.

[Business of Supply, February 5th, 2013]

Mr. Speaker, these are fundamental changes that have been brought forward, but they are needful. They are changes that are helping people find work, and I think that is the part that has been completely misunderstood in this process.

As I mentioned in my speech, there were 268,000 jobs last fall that were unfilled in this country. We are working hard to connect people with those jobs. People look for opportunities to work. We are trying to help them find those opportunities. We are trying to make the system easier for them.

We are setting up job alert systems that will help them connect with jobs in their regions. As we have said all along, we are looking to help them use the skill sets they have to fill jobs that require their skill sets. We are not asking people to take jobs they are unqualified for or unable to do. We are not asking people to travel distances they are unable to travel. We are looking at this on a case-by-case basis, as required and needed.

The ultimate goal here is to connect Canadians with the jobs that are out there. I think that is something everybody fundamentally would like to see happen. Those who are not working would love to have a job. For every unemployed person I have talked to in my riding, their desire is not to collect unemployment; it is to find a job. We are working to help them find those jobs. I cannot see how that cannot be supported across the aisle.

[Business of Supply, February 5th, 2013]

Mr. Speaker, I am pleased to rise this afternoon to address the opposition motion.

As many of my colleagues have previously noted, our government cannot support the opposition motion, which uses such hyperbole and fundamentally misunderstands the effects of the changes we are making to the employment insurance system. A key fact for all of these changes is ensuring that Canadians are always better off working than not. This is why we have made much-needed changes to ensure the EI program is working effectively for Canadians.

The NDP are specifically calling for a renewal today of the extra five weeks pilot project in their motion. The pilot project was a temporary measure, aimed at providing five weeks of extra EI benefits to Canadians who were hardest hit during the worst years of the recession. This program was never meant to be permanent. It was introduced nationally by our government in 2008 and renewed in 2010 as part of our economic action plan.

We have seen over 920,000 net new jobs created since July 2009. Canada is in a period of economic recovery. Temporary supports such as the extra five weeks pilot project were allowed to end because of the improvements we have seen in our economy. A few of the regions covered by the pilot project in fact saw so much sustained job growth that they ended the pilot project early. The NDP seems to think that regardless of how many jobs are created or how far we have come in terms of economic recovery, temporary supports such as these must be made permanent.

Our government's top priority is creating jobs and fostering long-term prosperity. A key tool to achieving that goal is an EI system that achieves a balance between providing benefits to those who need them while supporting Canadians as they return to work. Beginning in April we are introducing a new permanent national approach to better align the calculation of EI benefit amounts with regional labour market conditions. This will replace another pilot program called the best 14 weeks pilot.

As of April, the amount a claimant receives per week will be determined using an average of their earnings over their best weeks of employment. In higher unemployment regions, fewer best weeks will be used in this calculation. This will result in a much-higher average if several high-paying weeks are used in the calculation as opposed to all weeks that may include some with little to no income. This change will ensure that workers employed in seasonal industries do not turn down work in the off-season for fear it will decrease the average used to calculate their benefits. In short, this new variable weeks program will make it more beneficial for workers to accept all available work in slower seasons of employment.

This is yet another example of how our government is looking to balance the EI system. We want to ensure that Canadians are always better off working than not. Unlike previous pilots that were available only in some regions, this countrywide approach ensures that people with similar labour market conditions will have their EI benefits determined in the same manner, regardless of where they live.

Our government is focused on improving programs such as EI, while the NDP would seek to only maintain disincentives to work and also impose a $21 billion carbon tax on Canadians.

Another improvement that we announced in budget 2012 was the new working while on claim pilot project. Previously only a portion of earnings were exempt from being clawed back. Once earnings exceeded this exemption, EI benefits were clawed back dollar for dollar. The result of this policy was that claimants reduced their labour force attachment by turning down work that exceeded their exemption. This was creating a disincentive to work.

Under the new working while on claim pilot, the clawback is reduced to 50%, starting from the first dollar earned. As claimants search for permanent employment, this new pilot increases the benefit of accepting all available work by allowing them to keep more of what they earn while on EI. For Canadians who feel they were better served under the previous method of calculation, they are able to opt into the old system. Both these measures work toward our government's goal of ensuring that Canadians are always better off working than not. That is how one fosters economic growth, not by imposing new carbon taxes or by maintaining disincentives to work.

Canada's economy is leading the G8 when it comes to job growth. Over 920,000 net new jobs since July 2009 have been created under our watch. We are emerging from the recession far ahead of other developed nations. With new jobs come opportunities. According to Statistics Canada, in the fall there were 268,000 job vacancies across the country. We need to ensure that Canadians are aware of these jobs so that we continue to see sustained economic recovery.

We recognize there are Canadians who are having difficulty finding work, particularly in the off-season, in parts of the country where a significant section of the economy is based on seasonal industries. Our government is working to help these Canadians find jobs in their local areas, which are appropriate to their qualifications. For those who are unable to find employment, employment insurance will be there for them, as it always has been.

Personal circumstances, working conditions and hours of work will continue to be assessed on a case-by-case basis. We are making common sense changes to the employment insurance system to ensure that Canadians have the tools and resources they need to find local jobs in their local labour markets, within their skill sets.

It is worth repeating that the opposition motion before us today completely skews the facts and panders to a politics of fear that the opposition has, unfortunately, adopted. These are the politics of political desperation. For this reason I urge all members of the House to join with our government and vote against the motion.