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37th PARLIAMENT, 2nd SESSION

Standing Committee on Transport

EVIDENCE

CONTENTS

Monday, February 10, 2003

1535

The Vice-Chair (Mr. James Moore (Port Moody—Coquitlam—Port Coquitlam, CA))

Mr. Michael Giroux (Vice-President, Cement Association of Canada)

1540

Ms. Patricia Devine (Director, Public Affairs, Cement Association of Canada)

The Vice-Chair (Mr. James Moore)

Mr. Jim Gouk (Kootenay—Boundary—Okanagan, Canadian Alliance)

1545

Ms. Patricia Devine

Mr. Jim Gouk

Mr. Michael Giroux

Mr. Jim Gouk

Mr. Michael Giroux

Ms. Patricia Devine

Mr. Jim Gouk

Ms. Patricia Devine

Mr. Michael Giroux

Mr. Jim Gouk

Ms. Patricia Devine

Mr. Jim Gouk

Mr. Michael Giroux

1550

Mr. Jim Gouk

Mr. Michael Giroux

Mr. Jim Gouk

Mr. Michael Giroux

The Vice-Chair (Mr. James Moore)

Mr. Roger Gallaway (Sarnia—Lambton, Lib.)

Mr. Michael Giroux

Ms. Patricia Devine

1555

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Roger Gallaway

Ms. Patricia Devine

Mr. Michael Giroux

Ms. Patricia Devine

1600

Mr. Roger Gallaway

The Vice-Chair (Mr. James Moore)

Mr. Mario Laframboise (Argenteuil—Papineau—Mirabel, BQ)

Mr. Michael Giroux

Mr. Mario Laframboise

Mr. Michael Giroux

1605

Ms. Patricia Devine

Mr. Mario Laframboise

Mr. Michael Giroux

Mr. Mario Laframboise

Mr. Michael Giroux

Mr. Mario Laframboise

Mr. Michael Giroux

Mr. Mario Laframboise

The Vice-Chair (Mr. James Moore)

Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.)

1610

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Patricia Devine

1615

Ms. Liza Frulla

Ms. Patricia Devine

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

Ms. Liza Frulla

Mr. Michael Giroux

The Vice-Chair (Mr. James Moore)

Mr. Rex Barnes (Gander—Grand Falls, PC)

1620

Mr. Michael Giroux

Mr. Rex Barnes

Mr. Michael Giroux

Mr. Rex Barnes

The Vice-Chair (Mr. James Moore)

Mr. Claude Paul Boivin (President, Association of Consulting Engineers of Canada)

1630

Mr. Peter Boyd (President, Delcan; Association of Consulting Engineers of Canada)

1635

Mr. Pierre-André Dugas (Vice-President, Transportation - Génivar, Association of Consulting Engineers of Canada)

1640

Mr. Claude Paul Boivin

The Vice-Chair (Mr. James Moore)

Mr. Claude Paul Boivin

The Vice-Chair (Mr. James Moore)

Mr. Jim Gouk

1645

Mr. Peter Boyd

Mr. Jim Gouk

Mr. Claude Paul Boivin

Mr. Jim Gouk

The Vice-Chair (Mr. James Moore)

Mr. Stan Keyes (Hamilton West, Lib.)

Mr. Claude Paul Boivin

Mr. Stan Keyes

Mr. Claude Paul Boivin

1650

Mr. Peter Boyd

Mr. Stan Keyes

Mr. Claude Paul Boivin

Mr. Stan Keyes

Mr. Claude Paul Boivin

Mr. Stan Keyes

Mr. Claude Paul Boivin

Mr. Stan Keyes

1655

Mr. Peter Boyd

Mr. Stan Keyes

Mr. Peter Boyd

Mr. Stan Keyes

Mr. Peter Boyd

Mr. Stan Keyes

Mr. Peter Boyd

Mr. Stan Keyes

Mr. Peter Boyd

Mr. Pierre-André Dugas

Mr. Stan Keyes

The Vice-Chair (Mr. James Moore)

Mr. Mario Laframboise

Mr. Claude Paul Boivin

Mr. Mario Laframboise

Mr. Claude Paul Boivin

1700

Mr. Mario Laframboise

Mr. Claude Paul Boivin

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Claude Paul Boivin

Mr. Mario Laframboise

Mr. Claude Paul Boivin

1705

Mr. Mario Laframboise

Mr. Claude Paul Boivin

Mr. Mario Laframboise

Mr. Peter Boyd

Mr. Mario Laframboise

Mr. Pierre-André Dugas

Mr. Mario Laframboise

Mr. Pierre-André Dugas

The Vice-Chair (Mr. James Moore)

Mr. Larry Bagnell (Yukon, Lib.)

1710

Mr. Pierre-André Dugas

Mr. Larry Bagnell

Mr. Pierre-André Dugas

Mr. Larry Bagnell

Mr. Pierre-André Dugas

Mr. Larry Bagnell

Mr. Pierre-André Dugas

Mr. Claude Paul Boivin

Mr. Larry Bagnell

Mr. Pierre-André Dugas

Mr. Larry Bagnell

The Vice-Chair (Mr. James Moore)

Mr. Rex Barnes

1715

Mr. Pierre-André Dugas

Mr. Rex Barnes

The Vice-Chair (Mr. James Moore)

Ms. Liza Frulla

1720

Mr. Pierre-André Dugas

Ms. Liza Frulla

Mr. Pierre-André Dugas

Ms. Liza Frulla

Mr. Pierre-André Dugas

Ms. Liza Frulla

Mr. Pierre-André Dugas

Ms. Liza Frulla

Mr. Pierre-André Dugas

Ms. Liza Frulla

Mr. Pierre-André Dugas

1725

Ms. Liza Frulla

Mr. Pierre-André Dugas

Mr. Rex Barnes

Ms. Liza Frulla

The Vice-Chair (Mr. James Moore)

Mr. Marcel Proulx (Hull—Aylmer, Lib.)

The Vice-Chair (Mr. James Moore)

Mr. Marcel Proulx

The Vice-Chair (Mr. James Moore)

Mr. Mario Laframboise

Mr. Marcel Proulx

The Vice-Chair (Mr. James Moore)

Mr. Marcel Proulx

Mr. Mario Laframboise

Mr. Marcel Proulx

Mr. Mario Laframboise

Mr. Marcel Proulx

Mr. Mario Laframboise

Mr. Marcel Proulx

Mr. Mario Laframboise

The Vice-Chair (Mr. James Moore)

Mr. Marcel Proulx

The Vice-Chair (Mr. James Moore)

Mr. Marcel Proulx

1730

The Vice-Chair (Mr. James Moore)

CANADA

Standing Committee on Transport

NUMBER 009

2nd SESSION

37th PARLIAMENT

EVIDENCE

Monday, February 10, 2003

[Recorded by Electronic Apparatus]

¹ (1535)

[English]

The Vice-Chair (Mr. James Moore (Port Moody—Coquitlam—Port Coquitlam, CA)): Order, please. We'll begin this meeting of the Standing Committee on Transport.

We are here discussing a motion that was brought forward by the member of Parliament for Argenteuil--Papineau--Mirabel, Mr. Mario Laframboise, and the motion we are examining is:

That the Standing Committee on Transport examine the issue of highway infrastructures across Canada, in order to provide the Minister of Transport with information for his negotiations with the Minister of Industry, responsible for the infrastructure program, and with the Minister of Finance, in the preparation of his budget.

We now know, of course, that the budget is coming down next week, which makes these hearings all that much more important for us to hear.

Joining us for the first part of today's committee meeting is the Cement Association of Canada, and Mr. Michael Giroux and Patricia Devine, who are here.

The process is a 10-minute presentation by yourselves followed by a round robin of questions and answers. It's an open forum.

The floor is now open to you. Welcome to the committee.

Mr. Michael Giroux (Vice-President, Cement Association of Canada): Good afternoon, Mr. Chairman and members of Parliament.

First of all, even prior to introducing Patricia and myself, I'd like to break the obvious suspense here by declaring our support for the committee's study and the concept of a national highways program or strategy. That's the first point.

That said, let me introduce myself. My name is Michael Giroux. I'm with the Cement Association of Canada, l'Association canadienne du ciment. We're based here in Ottawa--this particular office anyway, our national office. We have offices in Vancouver, Calgary, Toronto, Montreal, and Halifax.

With me is Patricia Devine. She is our director of government affairs. She will take on the second half of the presentation today. It won't be very long at all.

Just before we start, there are some slide decks available here. We had only a very limited number of French-language copies, which have been passed out, but if there are people interested in the English version, please help yourselves.

A little bit about who the Cement Association of Canada is. We are really the voice of the Canadian cement industry. We represent 100% of cement producers in Canada. That means we represent 10 companies. Our operations are across Canada, as I've already mentioned, and we are located in many of the ridings.

Amongst those.... Is Alex Shepherd here, or Robert Lanctôt? We have cement producers in their ridings.

The CAC, the cement association, provides its members with a vehicle to participate in public affairs, and we work with our strategic partners, mostly with our concrete allies, to expand our business opportunities in Canada.

As mentioned before, CAC members are located across Canada and include well-known companies such as Lafarge, St. Lawrence, and St. Mary's, among many others.

Our contribution to Canada's economy is in the order of about 22,000 jobs, and there are thousands more that are indirect jobs in Canada. Our revenues, on a yearly basis, are in the order of $4 billion.

We produced approximately 13.2 million tonnes of cement in 2001, of which somewhere between 30% and 40% is exported to the United States at this time.

Now that I've provided a brief background on the CAC and our members, and just putting on our public affairs hat at this time, we would like to provide you with our context for this delivery today. Our context is taken from the throne speech, given back in the September timeframe, in which the government stated that an innovative economy, a healthier environment, and infrastructure renewal are key priorities.

The CAC sees an intersection between these three priorities. To help achieve these policy objectives, our industry offers sustainable and innovative solutions. In this particular case, we're talking about concrete highways.

Without any further ado, just getting straight to our key points today, we have three. The first is that we support the concept of a national highway strategy that includes committed long-term and sustainable funding, and sustainable development as a key requirement as well, the concept of sustainable development.

Our second key point is that, in our view, a national strategy includes a financial incentive to the provinces to build better highways.

Our third point is that the cement-concrete industry offers concrete highways as a better solution for high-traffic routes and trade corridors. The reasons for this are, first, from the environmental benefits perspective, where we have documents and studies that show we can reduce greenhouse gas emissions and that these systems reduce smog.

Also, just looking at it from a taxpayer benefit or value, these types of solutions require less maintenance, provide a longer life, and really are a good return on investment.

That said, I'd like to ask Patricia to complete our presentation today.

¹ (1540)

Ms. Patricia Devine (Director, Public Affairs, Cement Association of Canada): Thank you, Michael.

I'd just call your attention to this binder, which is chockablock full of scientific evidence to some of the claims we've made. I know that probably members of Parliament and the deputy are so interested in going through all of this--I think you'll get lots of reading material to keep you busy. I will submit it to the clerk of the committee.

In this binder, two studies in particular are of note. The National Research Council undertook a study in 1999 over four seasons that looked at the effect of surface or pavement type--concrete or asphalt--on fuel consumption. It found there was up to an 11% savings for heavy trucks travelling on a concrete pavement. Also, KPMG research conducted in Ontario, Quebec, Alberta, and British Columbia looked at the socio-economic factors related to concrete highways, for example, user costs, delay costs because of increased maintenance from asphalt, and the benefits to the trucking industry because of the reduced fuel consumption--and they're quite significant.

So if you do want access to this information, we have several extra copies at our office, and my card is on some of the other documents in front of you.

I'm not sure whether all members, Mr. Clerk, have received these two documents. I'm going to speak specifically to a couple of references in them.

There are two documents. One is a brochure called The Benefits of Concrete Highways. On the inside cover there's a paragraph about concrete pavements lasting longer, and in fact it's been shown, it's pretty well recognized across the country, that concrete highways last about twice as long as asphalt highways. To cite a reference, the Ministry of Transportation of Ontario conducted a study done by various consultants that found the average lifespan of an asphalt highway was 17 years, and for concrete highways it was 34 years. I'd also draw your attention to the point I just made about the fuel savings, and that's on page 4.

When we started this endeavour of talking about the benefits of concrete highways, we found there were many common questions on concrete highways that popped up all the time, so we decided to do a FAQ sheet on them.

I'll draw your attention to number 2: What type of roadway would benefit most from concrete?

The Cement Association of Canada is advocating concrete highways for our trade corridors. We're not looking to pave concrete on every secondary road in Canada; it wouldn't be cost-effective for Canadian taxpayers. But on trade corridors, those roads that carry in excess of 1,000 to 1,500 trucks per day, concrete highways do have a higher return on investment. That's because concrete is a rigid pavement. It stands up to the wear and tear of heavy trucks. It offers fuel savings for heavy trucks, and of course when you have fuel savings you have fewer emissions. Fewer emissions mean fewer greenhouse gas emissions and smog, which are very important issues in Canada today, especially to the government.

Question 8 is: How do concrete highways stand up in cold weather?

In fact, there's a good track record of concrete highways in the coldest parts of Canada and the U.S.

Question 13 is: How does Canada compare to other countries in concrete highways?

Sadly, we are lacking in concrete highways compared to other countries, namely in Europe and the U.S. In the U.S. over 30% of the interstate highways are paved in concrete. In Canada, we don't keep data, but Quebec has the most, and 4% of their network is paved in concrete.

We'd be happy to answer any questions, especially the ones on this sheet, where the answers are already provided...but seriously, we would like to entertain your questions.

The Vice-Chair (Mr. James Moore): Thank you both very much.

For questions, we'll go first to Mr. Gouk for 10 minutes.

Mr. Jim Gouk (Kootenay—Boundary—Okanagan, Canadian Alliance): Thank you, Mr. Chairman. There are a couple of things I'd like to find out in general. First of all, I have some correspondence from a lot of concrete firms regarding the fact that the Kyoto Accord is going to have a significant impact on the concrete industry. I'm not glad to hear it's going to have a significant impact--

¹ (1545)

Ms. Patricia Devine: I'm glad to hear you heard from them.

Mr. Jim Gouk: --but that somebody knows about it.

I wonder if you could tell us in what way that would impact on you and what impact that in turn might have on considering concrete for our highway system. You're talking about how you can provide some positive green effects by putting in concrete major highways. Will that counteract, without the other detrimental effects, the Kyoto Accord impact on your industry?

Mr. Michael Giroux: We could talk about this to some extent. This is a very challenging time for the industry in Canada. People tend to look at us and at our emissions right away as opposed to looking at the life cycle of the final product. So we often speak in terms of not what it costs to produce our materials in terms of greenhouse gas emissions, but in terms of the actual life of the product over 50 years and how efficient it is. We prefer to look at it as solutions based.

When you ask about the impact on us, we could look at the limited view of what it might do to our producers and how we might have to react in the future, or we could take the much healthier, at least from our perspective, view of what it means to the solutions we bring to the table that will reduce greenhouse gas effectively. Those solutions include highways and other infrastructure-based products like integrated waste management systems built out of concrete and insulated concrete form housing projects and so on. So we do have solutions in that area.

Mr. Jim Gouk: Have you looked at it in terms of being able to make a presentation to show that you could in fact meet your Kyoto requirements and beyond without a negative impact on the industry, by providing things like major highways and having that trade-off effect, and then making a specific case for consideration to having that your Kyoto commitment?

Mr. Michael Giroux: We haven't put a presentation as such together. We are looking into doing some case studies that might involve groups like Kellogg's or KPMG Peat Marwick to be impartial jurors of this with some highways outside of Montreal. So I would say it's in the development process.

Patricia, would you like to add to that?

Ms. Patricia Devine: I would like to add that currently, Mr. Gouk, we are in negotiation with the government to negotiate a sectoral agreement. And I'm sure those issues will be taken into account when they're looking at the agreement that will be signed with our sector.

Mr. Jim Gouk: Okay. I noticed somewhere that you talk in terms of the smoothness of the highway, but I've seen highways in the United States where they do use a lot of concrete, and on the really heavy truck lanes--and I don't know how old those are--you see considerable tire grooving, where there's a wear factor. What is the timeline for that appearing? What, short of major reconstruction, can be done to deal with that?

Ms. Patricia Devine: I'm not the technical expert, and we certainly do have a technical expert and I will get you a more thorough answer to that question. However, my knowledge is that probably the roads in the U.S. that were built in concrete have been there for 30 years plus, and they probably haven't been repaired because concrete is a rigid structure. One of its feature benefits is that it doesn't rut and it doesn't produce potholes.

That said, though, I will get you a complete answer to the question and we'll return it in writing.

Mr. Michael Giroux: It's fair to say that when we look at concrete we have to look at the nearest substitute for it, which is asphalt, and generally the life of concrete is rated at about twice as long as that of asphalt.

Mr. Jim Gouk: The reason I ask that is this. In the case of asphalt, of course, when certain types of damages occur, you can do maintenance and repair or secondary reconstruction as opposed to major reconstruction. I gather once concrete does go, whether it be in 35 years or whatever, then you're looking at replacement.

Ms. Patricia Devine: I guess it's a trade-off. Are you holding up traffic, are you doing construction every five years, or do you have a highway that lasts for a good 20 years before you have to do major reconstruction?

Mr. Jim Gouk: Okay. I think a very appropriate question, given that we're in Ontario and in Ottawa in the wintertime, is the impact of salt on concrete as opposed to asphalt.

Mr. Michael Giroux: I'm just thinking back to your previous question. I'll try to answer that one as well.

There are examples such as the Queensway--though I'm not sure that's a great example--here in Ottawa that were originally concrete and that have been paved over or at least have light cap paving with asphalt. There are ways of extending concrete as well in a very cost-effective way, where you use it as a base, and that has been done.

With respect to salt, there are a lot of studies that have been done with concrete. Concrete, depending on its makeup, can have different permeabilities, but generally, a well-constructed concrete highway with steel structural elements inside it should survive quite nicely. It has been designed to do that.

If you would like, we can provide you with either some studies or some information on that subject. There are numerous R and D projects in that area that have already been done and others that are under way as well.

¹ (1550)

Mr. Jim Gouk: I'm from British Columbia, and pretty much all our bridge decks are concrete. There has been quite a lot of work now where they're continually taking up test sections to check, as you said, the steel that's in there. Has that been a problem that you know of in concrete construction for road beds, bridge beds, and so on, the ability of contaminants to get through the concrete to reach that steel and then openly weaken it?

Mr. Michael Giroux: It has been an issue, and I can speak from personal experience. I had an apartment here in Ottawa where they had to redo the parking lot inside the building because of salt infusion.

Yes, undoubtedly there are older-designed concrete roads and bridges where this has been an issue. We think we know that this has been passed with modern concrete technology these days. Again, I would have to provide you with the current body of work that shows the studies that have been done and the analysis of that.

Mr. Jim Gouk: Is fibre mesh an alternative to using steel in highways?

Mr. Michael Giroux: There are a lot of different additives they're putting into the concrete these days to prevent all sorts of corrosion, and that is one of them. I would have to look that up specifically for you.

The Vice-Chair (Mr. James Moore): Thank you.

Mr. Gallaway, you have ten minutes.

Mr. Roger Gallaway (Sarnia—Lambton, Lib.): Thank you very much, and guests, thank you for coming.

I wanted to go to point two. I think we're talking about something more than just the concrete industry; we're talking about a national highway strategy. Your point two is that a national strategy should include a financial incentive to the provinces to build better highways. I just want to flesh this out a little. Do you see this as a question of a cash transfer from the federal government to the provinces, or do you perhaps envision something like the national highway program introduced by President Eisenhower in the 1950s in the U.S., whereby the federal government said, this is no longer state jurisdiction, it's federal or national jurisdiction? How do you see it?

Mr. Michael Giroux: We discussed this opportunity to answer that question today, and we've given ourselves lots of wiggle room.

Voices: Oh, oh!

Mr. Michael Giroux: I think it wouldn't be proper for us to state whether this is a federal or provincial jurisdiction. That being said, we can only speak to our experience, which shows that in the trenches, when we quote at the provincial level, oftentimes the provinces may look at a solution but they only look at it as black and white in terms of today's cost.

Although this is debatable at times, a concrete solution generally seems to be more expensive than an asphalt solution. That point really goes to trying to address the fact that without influence, without assistance, and without prompting, provinces may not always take the logical, long-term route to solutions but will look at the short term and how much something costs. Of course, all of you have ridings with asphalt producers in them. Come election time, those types of decisions get done very much more quickly.

I think your point is about what the national responsibility is, but all we're trying to do is point out the obvious, that sometimes the best decisions aren't taken. We'd like to try, and we would suggest that there might be a role there.

Ms. Patricia Devine: I would also like to add that we're toiling and trying to get funds for highways in Canada. And when we look to our neighbours to the south and when I talk to my colleagues...we're lobbying for $31.8 billion for highways for the next fiscal year. It's quite astounding.

The federal government, as you say, has so much more influence in the states. In terms of how the money is spent, it's an 80-20 split.

It was our impression that the reason there were so many more concrete highways in the states was because the federal government was responsible for capital costs and it gave the money to the states. They could build it in whatever they wanted to build it in, but the states were required to pay for maintenance. So a lot of them opted for the concrete option because there was less maintenance involved.

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Mr. Roger Gallaway: I think you're referring to the American legislation commonly known as Bill T-21.

Ms. Patricia Devine: Yes. But the $30.8 billion was actually for this coming year.

Mr. Roger Gallaway: Now, you refer to trade corridors. I know what a trade corridor is--I think I do anyway. Can you tell me what you mean by a trade corridor?

Ms. Patricia Devine: We've never actually discussed what our definition is. My definition is routes that carry a lot of freight, truck travel to move those goods between Canada and the U.S., which our economy is so dependent on...interprovincially as well.

Mr. Roger Gallaway: Are you aware of trade corridor associations in the U.S.?

Ms. Patricia Devine: Yes.

Mr. Roger Gallaway: Have you had any contact with any of them?

Ms. Patricia Devine: I recently attended the Trade Corridors Conference in the Niagara region. That was the fifth one.

Mr. Roger Gallaway: Yes, I remember that.

Ms. Patricia Devine: Well, you would know. You know Sarnia.

Mr. Roger Gallaway: Sarnia's in my riding.

Ms. Patricia Devine: Of course. It was the guys from the Sarnia Chamber of Commerce who started this initiative. And it's evolving, and we're fully supportive of it.

Mr. Roger Gallaway: But that's from a Canadian perspective. Have you visited with any of the American trade corridor groups?

Ms. Patricia Devine: Well, the Trade Corridors Conference is a binational body, so at the conference there are representatives from the U.S.

I personally have not had any private meetings with the trade corridor groups in the U.S.

Mr. Roger Gallaway: I can't speak for today, but I can speak for the past. At one time there was an interdepartmental working group of External Affairs, Transport, and other departments in terms of studying trade corridors.

Do you know if that still exists, or have you ever met with anyone from that interdepartmental working group?

Ms. Patricia Devine: I haven't, but I know there's great interest for that kind of work to occur again.

Mr. Roger Gallaway: What do you think the recommendation of this committee ought to be with respect to trade corridors? How do we flesh this out? As you know, you've talked about the competing interest between immediate gratification, that is, an asphalt highway versus a longer-term solution, that is, a cement highway. You also know that when we start talking about a national highway strategy emphasizing trade corridors, the majority of trade corridors are where? They're in Ontario.

Ms. Patricia Devine: They're in Ontario, B.C., Quebec.

Mr. Roger Gallaway: We're talking about the 400 highways essentially. When we refer to a national highway program, are we talking essentially about trade corridors that are north-south or are we talking about a program of east-west corridors?

Ms. Patricia Devine: Well, I would think for anything that would be politically palatable, you'd have to include both. I would argue there's a fairly clear recognition that that's our largest trading partner. It's the economic engine, but I'm not going to take anything away from interprovincial trade.

Mr. Michael Giroux: Patricia, you might want to speak to the Quebec experience, the policy they're developing with respect to specific...and how that might affect trade corridors as well.

Ms. Patricia Devine: Okay. I thought I may have mentioned that earlier, but Quebec, from our perspective, has been very progressive in their highway policy management.

Last year they announced a policy whereby they looked at their highway network and they looked at the investment they were making into the highways. They divided it, for reconstruction purposes, into what we've called grey, white, and black.

There are sections of the highway, namely around Montreal and Quebec, that carry in excess of 1,500 trucks a day. You get the best return on your investment if you reconstruct those highways in concrete. When tenders come out they only go out for concrete, so they're white. For other sections of the Quebec road network, tenders only go out in asphalt. That's your best return on investment. And then there are areas of the road network that are deemed grey and that have to be further analysed at the time of the reconstruction.

In addition to life cycle cost analysis, where they look at the upfront cost of a highway plus the maintenance costs and so on, in Quebec they take a multi-criteria approach, where they also look at the socio-economic costs or benefits. This again is quite progressive.

And perhaps that could be some kind of model that the federal government would want to use as an example.

º (1600)

Mr. Roger Gallaway: That's okay.

The Vice-Chair (Mr. James Moore): Thank you, Mr. Gallaway.

You have 10 minutes, Mr. Laframboise.

[Translation]

Mr. Mario Laframboise (Argenteuil—Papineau—Mirabel, BQ): Thank you, Mr. Chairman.

Before implementing an international policy, I would like to know the state of the Trans-Canada Highway. Have you had a chance to study it section by section? Could you tell us what percentage is in good order? For example, is just 50 per cent of it in good condition or is it 70 per cent?

Mr. Michael Giroux: I can tell you beyond a shadow of a doubt that we do not do that type of analysis. It would be very interesting to have those facts. Some of them no doubt exist, but our association did not do that study.

Mr. Mario Laframboise: You say you are in support of a national policy and I feel we have indeed reached that point in Canada. But one must fully understand the situation.

Take Quebec, for example, and the famous 10¢ excise tax on gasoline; it brings in a little over $900 million. But over the past two years, only $60 million were invested in roadways. Those figures come from federal budgets.

Moreover, given the various programs that have been implemented, namely the Strategic Highway Infrastructure Program, the Canada Strategic Infrastructure Fund, worth $2 billion, and the Border Infrastructure Fund, it is estimated that if things go well, approximately $175 million could be available for the province of Quebec.

But we are still certainly far off the mark—and I am referring to the budgets that have been tabled—and of course we want additional funding. I am not talking about $900 million. Everyone knows the government needs that money for other purposes and I am sure you realize it will not be used for transportation. The rest of the money goes to the Consolidated Revenue Fund.

One day in Quebec we would like to have a program with an annual budget of $300 million for at least seven consecutive years. That might also be the case for other provinces.

In our case, at least 40 to 45 per cent of the excise tax collected on gasoline would have to be reinvested in the road infrastructure. Do you think that is realistic?

We do not want to quibble with the Liberals over numbers, but to ensure long-term financing, we must be able to get a portion of the excise tax on gasoline. That way we could have an adequate road infrastructure and each province could make its own investment choices. I am not here to challenge the choices that were made.

You say the province of Quebec is very advanced in terms of choosing the road and so forth, but all that requires money.

Basically, I would like to know whether you think it is realistic to ask the federal government to give us a portion of the excise tax on a recurring basis so that we can plan our investment. The same applies to you, the industry representatives.

Mr. Michael Giroux: What an interesting question! If I speak as a consumer rather than as vice-president of the association, I would say that it is an excellent idea. In fact, even as vice-president, I would say the same thing and I would be crazy to say otherwise. I can't say we have done the economic and socio-economic studies that would enable us to endorse that plan, but at first glance, it seems like an interesting and fairly logical suggestion. Patricia, do you have anything to add?

º (1605)

[English]

Ms. Patricia Devine: In terms of the highway lobby, for lack of a better term, we've been asking for some time that money raised through gasoline taxes go back into the highway system. Time and time again we've been told, “In Canada that's not the way we make public policy”.

It seems logical to us. That's how they do it in the U.S. I know they lobbied a long time for that change. We think it makes sense. We haven't done the economic analysis to determine whether or not it's realistic, but that's certainly something we would support.

[Translation]

Mr. Mario Laframboise: You are working right now. Do you do project assessments? Earlier on you said you had worked with the Quebec government. Is there a special budget for your industry? Do you have an idea of what each province is doing or do you have to start over every year? Do you have any definite plans to complete any projects?

Mr. Michael Giroux: Absolutely. In fact, as employees of the association, we are increasingly subject to assessments. Just to give you a little background, I would say that the roadway projects are really development projects. We are developing that market. Quebec is the most advanced province. It started at least 10 years ago. The other provinces lag behind. You can see it starting in Ontario and there are a few little things being done in Nova Scotia, but there is still nothing in western Canada.

Each of us has goals to broaden the market, to try to convince governments to act. We work with the American Concrete Paving Association here, in Canada, to facilitate our work. We hold a lot of seminars where we present the project. We work with the Quebec government, with Transport Québec, to translate the documents that were prepared there and then send them to the rest of the country. We have also translated some of the documents on that topic. So yes, there are objectives.

Mr. Mario Laframboise: What is the industry's annual sales figure? I mean just for roads.

Mr. Michael Giroux: I do not have any notes with me and I do not remember the figure. Generally we work in terms of tonnes or sometimes cubic metres. To get a dollar figure, you would have to multiply by a round number and that way we could get our turnover. I can send you the figure if you like.

Mr. Mario Laframboise: Perfect.

If there were ever a bigger road infrastructure program, would the industry be able to support it without a spiraling of costs for all road infrastructures? Would the industry be willing to see such an explosion or do you have to proceed more rationally because you have other types of businesses?

Mr. Michael Giroux: I would say we are ready and even enthusiastic about the idea. Right now, our plants are 10 to 20 per cent underutilized. So there is lots of leeway.

Mr. Mario Laframboise: That's all. Thank you.

The Vice-Chair (Mr. James Moore): Thank you.

Ms. Frulla, you have 10 minutes.

Ms. Liza Frulla (Verdun—Saint-Henri—Saint-Paul—Pointe Saint-Charles, Lib.): I would like to go back to what you said about Quebec and the rest of your statement as well.

[English]

I'd like to talk locally and globally.

[Translation]

With regard to using concrete as opposed to asphalt, I think it was proven first in the States and then in Quebec that concrete is more viable and durable than asphalt. But it always comes down to cost. It would be logical to say that for major roadways with heavy traffic, you should use concrete. When you see the state of our asphalt roads at the end of the winter, especially when there have been major temperature fluctuations, everyone agrees that the situation needs to be improved. Then there are the costs of repairs, etc.

So it always boils down to a question of money, analysis and the cost differential. Let's take the Trans-Canada Highway as an example. Let's say there were a national program and the Trans-Canada Highway would gradually be changed from one end to the other, bit by bit, from asphalt to concrete. How much would that cost in terms of a national investment? Do you have any idea?

º (1610)

Mr. Michael Giroux: Do you want a round number or a comparison with asphalt in percentage terms?

Ms. Liza Frulla: I would say a percentage, because after all, a round figure... It is really the percentage increment because the work has to be done anyway. We are talking about a change, in other words replacing one with the other. It is not a matter of repaving the road bit by bit using the same material, but of replacing it using a different material. So what would be the percentage increment?

Mr. Michael Giroux: That is a good question. In our industry, we use an approximate figure, and it still needs to be verified. That means it could be higher or lower, but the cost would be approximately 5 per cent more.

Ms. Liza Frulla: Is that additional 5 per cent construction cost amortized over 5, 10 or 15 years, or is it a basic investment?

Mr. Michael Giroux: It is a basic investment. That 5 per cent can be recovered in the long term. You can talk about the durability of the product to start, which is very important, and these days, you can also include the greenhouse effect.

[English]

Ms. Liza Frulla: And there's pollution and whatever that Jim was talking about.

[Translation]

Mr. Michael Giroux: When we include that, the product becomes much more attractive.

Ms. Liza Frulla: That is why I spoke of the long-term amortization. Does one recover that 5 per cent initial investment through lower maintenance costs?

Mr. Michael Giroux: You recover it over the long term. The question is how many years. To answer that, you have to look at the places and how... In some places, in Vancouver for example, durability is important, but it would be different from what it would be in Quebec. You have to take that into account as well.

Ms. Liza Frulla: That leads me to my second question on durability and using concrete. I presume it varies greatly from one province to another, depending on the climate.

Mr. Michael Giroux: Yes, and everyone knows that in Quebec and Ontario, there is an agreement between the provincial government and GM to salt the roads. In some provinces, such as Alberta, the roads are sanded, I believe. That also has an effect on the product's durability. So there are many factors that must be taken into account.

Ms. Liza Frulla: But in your view, it can be used everywhere, regardless of the situation.

Mr. Michael Giroux: Yes, but 5 per cent would be a worst case scenario, that would probably apply to Ontario and Quebec.

[English]

Ms. Patricia Devine: It's a concrete mix design, and you can tailor it to whatever application you have before you. It can be tailored to the exposure conditions so it will stand up to that climate.

Because some of you travel back and forth to Montreal, I'm sure you know there's a section of Highway 417 that was recently reconstructed in concrete. That was the first time the Ontario government ever put out alternate bids for both concrete and asphalt.

There's this perception among the DOTs--and this is the largest barrier to getting the provinces to build concrete highways--that it's so much more expensive upfront. In fact, when the two bids came in the concrete bid was 2% higher than the asphalt, but the MTO included life-cycle costing in the tender, which brought the concrete bid quite a bit lower than the asphalt bid. They took into consideration the maintenance costs of that highway over its lifespan, and that's what won that project for the concrete industry.

So it's on a project-by-project basis. When you're building a road, it depends on where the road is. How far do you have to haul the gravel, for example? Gravel is a big part of making a road. When you build an asphalt road you need a lot more gravel because the surface type isn't as rigid to withstand--

º (1615)

Ms. Liza Frulla: Yes. The problem is they don't put the same gravel everywhere, but that's another thing.

Ms. Patricia Devine: So it's questionable whether it's even.... This is a myth we're trying to dispel, to some extent.

Mr. Michael Giroux: On top of that, the Cement Association of Canada is linked very closely with the Portland Cement Association, which is based in Chicago. They have a lab there called CTL, which is associated with them, and they do extreme research on freeze-thaw cycles. There is considerable and ongoing research all the time on how to better use concrete and the different types of mixtures available.

Ms. Liza Frulla: It's an ongoing process.

Mr. Michael Giroux: Yes. It would be difficult to find the same thing in the other industries that make highways.

Ms. Liza Frulla: On a national strategy, apart from taking some of la taxe d'accise to pay for it, would you see...? In Quebec some roads, routes, are white in a way that....

[Translation]

For larger areas such as the Trans-Canada Highway, you would apply the same principle.

[English]

You have concrete and asphalt--all the advantages of one and the other, and may the best one win.

[Translation]

That would be one way of saying that, without changing everything, there is a lot of traffic on major roadways, so you...

Mr. Michael Giroux: It is black or white.

Ms. Liza Frulla: It is just a matter of looking at it as a whole.

[English]

It's the same thing as they're doing in Quebec. You have the grey, the white, and the black, but you go with either white to say, well,....

[Translation]

It would be to ensure some competitiveness between the two industries and to get organized so that the better one wins.

Mr. Michael Giroux: That is not a bad idea. There are two choices: we either just say it is concrete or cement, and you ask the different companies to get involved; or you ensure that the specific factors are taken into account for the lifespan of the road.

Ms. Liza Frulla: Exactly.

Mr. Michael Giroux: Right now, choosing concrete would be based on the amount of traffic, freezing conditions, etc.

Ms. Liza Frulla: In fact, you are suggesting that concrete be used for major roadways with a lot of traffic. Ideally, you would like to see concrete roads everywhere, especially in Quebec, but that is impossible because the cost is much higher.

Mr. Michael Giroux: That's right, yes. Patricia also said that it is more cost-effective to use another material such as asphalt under certain conditions. But one must be careful. In some places it might be better, whereas in others it might be just as good.

[English]

The Vice-Chair (Mr. James Moore): We have 10 minutes remaining with these witnesses. Mr. Barnes, those 10 minutes are yours.

Mr. Rex Barnes (Gander—Grand Falls, PC): I may not take 10 minutes, but I was getting a bit excited there for a second when you started talking about the definition of the trade quota.

I'm from Newfoundland and Labrador, and we just finished a 15-year deal with the federal government where we took the trains out of the province. Now the agreement is finalized and this is the last year. Of course, we're going to see a $50 million reduction in workload in our province because of that.

Now we're in the process of trying to make another agreement with the federal government. As I said, I was getting a bit excited because we depend on transport trucks to deliver everything to the island and off the island. As a result, we're looking at something big happening for our province.

Every five years our roads are in a major repair mode because of the volume of traffic that comes through our province. At any given time of the day, probably 10 or 15 transport trucks will pass you on the highway within a couple of kilometres. That's just normal business. As a result, we have a lot of traffic.

But one of the biggest things is the cost of concrete versus pavement. Any government--I don't care who's there--that's going to spend $1 billion on pavement in a year is going to get more bang for their buck with pavement than with concrete. So how do companies like yourselves try to make it feasible to go with concrete?

I think there are great benefits to using concrete, and when you talk about Kyoto and the environment we're all here for that. But it all comes down to one thing: dollars and cents. Regardless of whether it's going to last 15 years or 20 years, in the political arena it means how many jobs you're going to create in the short term, rather than taking care of it for the long term.

So how do you deal with some of those questions?

º (1620)

Mr. Michael Giroux: First, I'd sit down and have a beer and discuss it with the Newfoundlanders.

Mr. Rex Barnes: You'd get more done over a beer, too, than you do in Ottawa.

Mr. Michael Giroux: We're not a company; we're an association representing the companies. If we had the answer to that question, we'd probably have much happier companies or members associated with us. I think it's the challenge of the industry right now to explain just that. Particularly in the sector or in this highways adventure, we consider ourselves missionaries at this point in time, to try to pass the gospel on and try to make people look at it from a common-sense perspective. It is difficult.

We are working on a ministry of transport by ministry of transport basis right now, educating through seminars, through introductions to our technical people. This seems to be the way we're doing it.

In your case, the Newfoundland case, I don't think we even have a manufacturer on the island, so it makes it equally less...or perhaps more costly, as we'd have to import the materials.

The only argument I can think of here at this point in time is to look at it as a long-term return on investment. If you look at it as a five-year turnaround, that's one way to look at it, but if you look at 10 or 20 years, it's perhaps a more sane way of looking at it, although I'm not too sure that would give you more jobs over the long run.

Mr. Rex Barnes: I see great benefits in it, and I see great benefits for rural areas of this country.

I use two plans. It has great benefits for central Canada, and I think central Canada should take advantage of it. In rural Newfoundland, where we depend on tourism greatly, Newfoundland and Labrador has seen its highest numbers ever with regard to tourism. One of the biggest downfalls is roads. If there was a concept of doing roads with concrete in Newfoundland and Labrador and it would last for 20 years, I tell you, Newfoundland and Labrador could prosper greatly just on the benefits. The benefits outweigh the costs, but unfortunately, at times in the political arena it doesn't work that way. We can kid ourselves around the table now, but that's the way it goes.

In central Canada, where you have the bulk of the traffic, the bulk of the population, it's almost a necessity to have it. But of course we can't forget the other provinces, because each province has its different agenda.

If concrete could survive in Newfoundland and Labrador, it could survive anywhere in Canada.

I have no questions, just a statement, because I think enough has been said. Basically, we know the benefits. We know the pros and cons. I just think trying to find the money is the key. That's all.

The Vice-Chair (Mr. James Moore): We have five minutes remaining.

Mr. Keyes or Mr. Proulx, do you have any questions? You're all right?

Then I thank the witnesses very much for their appearance here today.

If you have any additional information, feel free to give it to any of the committee members, or to the clerk, and the clerk will disseminate it to all committee members. Thank you very much.

We'll take five minutes while the next set of witnesses gets prepared. We'll start at 4:30.

º (1625)

º (1629)

[Translation]

Mr. Claude Paul Boivin (President, Association of Consulting Engineers of Canada): Good morning Mr. Chairman and members of the committee. My name is Claude Paul Boivin and I am the President of the Consulting Engineers Association of Canada. I would like to introduce to you Mr. Pierre-André Dugas who is Vice-President, Transport, with GENIVAR, and Mr. Peter Boyd who is President of Delcan. GENIVAR and Delcan are two major consulting engineer firms in Canada who are well recognized for their expertise in transportation matters.

Our association represents the consulting engineer firms in Canada. We have some 600 members who, together, employ over 52,000 Canadians, and their annual contribution to Canada's economy is approximately $6.4 billion per year. It is a major industry.

º (1630)

[English]

Mr. Chairman, we're here today to talk about Canada's out of control infrastructure deficit, specifically the infrastructure deficit in highways.

With respect to our highways, our association is concerned about the safety of passengers and the economic consequences of travelling down what we call a “substandard” national highway system in Canada. As professional engineers who are obligated to protect public health and safety, we feel we must add our voice to the many who have come to see you, and perhaps government, to alert the federal government about the state of our national highway system.

Our roads, and the cars, trucks, and buses that use them, are really at the core of our transportation system and will continue to be for a long time to come. We have to recognize that. In a large country like Canada, with dispersed economic activity, aircraft, ships, and trains are important, but when you do all the mathematics, the roads are transporting most of our freight and passengers today. So I think it's very important that we pay attention to them.

Canada's overall infrastructure deficit is not just made up of highways. It also includes water treatment plants, waste disposal systems, bridges, and all those facilities that make our communities work. It's difficult to pinpoint exactly what the infrastructure deficit is, but the experts will agree that it is at least $44 billion, and out of that, about $17.2 billion can be attributed to investments in roads and highways.

What is more frightening, Mr. Chairman, is that a TD Bank Financial Group report indicates that this infrastructure deficit is growing--and this is an independent study--by $2 billion a year. That's what we mean when we refer to an out of control infrastructure deficit. Unless action is taken now by our government, this national problem will become increasingly difficult to wrestle to the ground.

Our association sees this infrastructure deficit as Canada's second national debt. We believe it is as devastating and crippling as the fiscal debt. As a matter of fact, the infrastructure debt probably affects people's lives much more than the fiscal debt, in terms of our health, safety, and well-being. So we say that the infrastructure debt--that's what we call it--should be tackled with the same level of urgency and vigour as the fiscal debt.

As an industry we applaud the government's successes and efforts in eliminating deficit, and I guess we're here today to ask that the same attention be given to the infrastructure deficit. We heard a promise from the government in the Speech from the Throne about a 10-year infrastructure program. We welcome that. However, the necessary and adequate level of financing will be required to ensure that promise is kept. Of course, highways will be a large part of that investment that we hope the federal government will be making.

To talk about the state of our national highway system, I'd like to turn now to Mr. Peter Boyd. Mr. Boyd may have to leave a little early because he has a train to take--that's another mode of transport--but we hope we can keep him very long.

Peter.

Mr. Peter Boyd (President, Delcan; Association of Consulting Engineers of Canada): Thank you for the commercial.

Good afternoon, Mr. Chairman, members of the committee.

Before I talk specifically about the national highway system, I want to remark on a fact that has been touched on here, which is that the infrastructure deficiency and degradation is occurring at every level. It's not just a national highway problem; it's a provincial and a municipal problem. We have inadequate networks for trucks, for passenger vehicles, for transit. It's creating gridlock in some of our major urban centres, and what's happening with gridlock is we're driving industry from the centre of the city, also residents, and we're creating sprawl, and we're creating more roads and more problems and more deficiencies.

The difficulty here with the pervasiveness of this problem is that we're contributing to the deterioration of Canada's public health, the quality of life, and negatively impacting our country's economic competitiveness. We are edging towards crisis.

Specifically, on the national highway system, having played a role in planning and design and development, the Association of Consulting Engineers of Canada believes we're in a solid position to make some recommendations and provide some information and background.

The incidence of infrastructure failures and safety infractions increases when regular maintenance and repairs are not conducted and when the system is asked to perform beyond its original design requirements or life cycle expectations. We're talking here about 15- to 25-year life cycle expectations for infrastructure being extended well beyond those requirements, which has catastrophic results in terms of cost and quality.

Canada has designated roughly 25,000 kilometres of its 900,000 kilometres of road as part of a national highway system. Of this, only 7,300 kilometres are multi-lane, divided. Much of the system was built in the 1950s and the 1960s for a smaller population and a much smaller, less rigorous, and demanding use of trucks and vehicles. We now have more vehicles. We now have bigger vehicles. We now have heavier vehicles.

Today the national highway system is carrying 72 billion vehicle kilometres per year. I can't help you understand that. I don't understand it. Seventy-two billion vehicle kilometres. It's an incredible number.

Studies show that 38% of the system is below minimum design standards or below 90 kilometre-per-hour minimum operating speeds. Weight, speed, and road design standards vary across the country from one jurisdiction to another, creating a safety problem because there's no universal enforced national highway standard.

Over 20% of the national system's 3,500 bridges require major strengthening or rehabilitation.

In spite of these deficiencies in the system, the federal government has limited its dedicated investment to highways to $600 million over four years. By way of comparison, that's $5 per capita per year in Canada.

In the U.S., with a national highway system some ten times greater, 255,000 kilometres, the U.S. government is currently investing $171 billion in highways, $270 million in T-21, which should increase by 50% in its recapitalization this September, and the U.S. comparative number to our $5 is $110 per capita.

Even with the $2 billion strategic infrastructure fund, of which only a limited part will go to highways, Canada is way behind the United States in terms of a commitment to safe and reliable highways, and as you can see, falling further behind at a relatively rapid rate.

On our highway transportation infrastructure, to be competitive with the U.S., Canada will have to do better or risk losing commercial and tourist traffic to safer, more efficient southern routes.

I'll now ask my colleague, Pierre-André Dugas, to talk about safety aspects on the system.

º (1635)

[Translation]

Mr. Pierre-André Dugas (Vice-President, Transportation - Génivar, Association of Consulting Engineers of Canada): Mr. Chairman, members of the committee, although considerable progress has been made over the past 30 years in terms of road safety in Canada, there are still 3,000 people who die and 220,000 people who are injured on our roadways every year. Progress is mostly attributable to better driver education, to stricter legislation dealing with driving while impaired and the wearing of seatbelts, as well as to the fact that cars are simply better built.

The Canadian consulting engineers industry feels that the time has come to examine the considerable security advantages which would stem from roadways and highways which were safer and the use of proven or emerging technologies, such as intelligent transportation systems, in our vehicles and on our highways. As an example, on the Décarie expressway in Montreal, with the addition of the systems we have just indicated, we were able to increase the capacity to 25,000 vehicles per day. Therefore, sometimes, systems which may appear expensive at the outset are really cost-effective when you look at the overall picture, and allow us to considerably increase the quality and safety of our infrastructure.

The statistics compiled by the OECD indicate the number of fatal accidents on divided highways is considerably lower than that of non-divided highways. For example, there are 1.54 accidents per million vehicles per kilometre on a national highway without a dividing area, compared to .74 accidents on a major highway with a divider. As you can see there is a considerable difference between the two. On other types of roadways and highways, the rate of fatal accidents—and here I'm only referring to fatal accidents—is seven times higher than that of four-lane divided highways. The difference is quite noticeable.

The study carried out in 1997 by the Council of Ministers Responsible for Transportation and Highway Safety concluded that 247 lives could be saved and thousands of injuries prevented every year in Canada if we were to carry through on the improvements program recommended which would cost some $17.2 billion to improve our national highway system. The council also felt that the implementation of this program could lead to additional benefits which could be valued at up to $30 billion.

And now, Mr. Chairman, I would like to discuss the role of the federal government. It is essential to recognize that the federal government has a formal role to play when dealing with national highways, under the Canada Transportation Act.

We could wonder whether this critical transportation system, which transports 65 per cent of the goods exported to the United States and 70 per cent of all manufactured good shipped throughout Canada, is not considered sufficiently important to be included in Canadian legislation governing transport.

National leadership, expressed in a national road policy bracketed by the Canada Transportation Act, must include clear directives in terms of security and levels of service. The variety of current programs does not allow us to attain these levels of quality of service. A national policy must also include the creation of a permanent program, with appropriate funding, which would ensure that the needs of long-distance travellers or merchandise transportation are met.

The major obstacle to creating safer roadway infrastructures in Canada is the inability of government decision-makers to deliver the money to those who have the responsibility for the maintenance and the running of these roadway networks. Toll highways exist throughout the country, but are not unanimously accepted here as they are in Europe. Public-private partnerships are increasingly popular in Canada, but do not seem to be the best solution, from what we can see.

º (1640)

[English]

Mr. Claude Paul Boivin: Mr. Chairman, we have recommendations. We won't read them out. We know we've gone over our time.

The Vice-Chair (Mr. James Moore): It's all right with me. It will take about three minutes to read through the recommendations, and with the indulgence of the committee, that's okay.

Mr. Claude Paul Boivin: I think in conclusion what we're saying is that Canada's national highway system is in a serious state of disrepair. Part of that is due to the lack of funding from the federal government. It puts the lives of travellers perhaps unnecessarily at risk, and it jeopardizes our economic situation with respect to trade.

What Canada needs is a well-funded strategy for infrastructure. Without reading the priorities, basically what we're asking for is: one, that the projects be prioritized, that the provinces and the federal government, all the levels of government, agree on the priorities; second, that there be a 15-year plan, a well-funded, permanent program because these projects cannot be turned on and off; and, thirdly, that whenever there is a project, there be a maintenance component considered to ensure that the life cycle of these projects reaches its maximum.

Mr. Chairman, we'll conclude with that. My colleagues and I will be pleased to entertain questions from your committee. Thank you.

The Vice-Chair (Mr. James Moore): Thank you very much.

You have the first 10 minutes, Mr. Gouk.

Mr. Jim Gouk: Thank you, Mr. Chairman.

Thank you, gentlemen. I'm going to be as brief as I can, because many of us get double-booked and I'm one of them. I have another meeting at 5 o'clock.

Back as far as 1996, the then Minister of Finance was before this committee and I raised the question of dedicated revenues, recognizing that there's no way, nice though it might be, they would be able to take all the fuel tax revenues they get from the highway sector and put it into highways. What I asked at that time was that 20% be dedicated to the highway system.

We had done quite a bit of study, both in and out of this committee, and it was indicated by a lot of experts across the country--and I think your organization had some input in this as well--that with that kind of dedicated stream of funds we could rebuild the national highway system over a 15-year period, which was deemed to be reasonable. It would be nice if we could go out on day one and just put a new highway in, but that's not going to happen. So I would ask, first of all, if that is still reasonable.

The second thing is that while the Minister of Finance was here I suggested that from the studies we had done, while the government was trying to save money and rationalize how they spent the money, a dollar spent on the highway system now would save at least $3 down the road in other costs, that we could save a $3 repair by doing a $1 repair now. He actually responded that he thought it was probably more in the line of $5 in savings for every dollar spent. Could you comment on that as well?

º (1645)

Mr. Peter Boyd: Yes, I'd be pleased to, Mr. Gouk.

I don't have the specific numbers in front of me, but let me give you a general response to the situation in 1996, and it also bears on the second part of your question, the $1 to $3, or $1 to $5, or greater.

Six or seven years have gone by since those numbers were calculated. You can be certain that the situation has not improved any. You can be certain that in fact it has deteriorated. And given the characteristics of the decay curves of infrastructure, i.e. it stays relatively level in its performance over a period of 5, 10, 15 years and as it approaches its critical stage it drops off very quickly, when its performance drops off that's when you get the huge increase in costs. That's why a dollar spent up here will save you $3 here and $5 down there.

So while I can't give you a quantitative answer to your first question, I'm sure the situation would be vastly improved by 20% dedicated funding, but it would be a bigger challenge six years later. And, as I say, the issue of a dollar spent now is probably more critical than it was six or seven years ago.

Mr. Jim Gouk: Also, in terms of priorities, in a previous round of questioning Mr. Barnes talked about the density of traffic in his home province, and I believe he used the figure that you could see as much as 15 heavy trucks go by within an hour on any given stretch. I'm from British Columbia, and on Highway 1, particularly the Rogers Pass, you would see that in 60 seconds at any given time of day.

Do you have any areas of the province where you think the work is most pressing? You mentioned the twinning of highways. The section of the highway through Rogers Pass is known as the “death highway”. It's probably one of the worst in the country. Have you set out any priorities as to where the highest needs are, so that we could then expand from there?

Mr. Claude Paul Boivin: The answer is no, because we believe that's not really our role. We're not mandated to do that. But one of the things we recommend is that the governments set up a process to identify those priorities, to do an inventory of what the highway needs are, and to decide that we're not going to be able to do them all but these are the ones we're going to do. Some of these are political decisions, some are economic decisions, and, in our view, they're for government to make.

Certainly, our friends would be happy to work on those assessments when the time comes.

Mr. Jim Gouk: Thank you.

Thank you, Mr. Chair.

The Vice-Chair (Mr. James Moore): Thank you.

Mr. Keyes, you have 10 minutes.

Mr. Stan Keyes (Hamilton West, Lib.): Thank you, Mr. Chair.

Thank you, gentlemen, for coming before us at the committee. I found your information informative and useful.

Where should I begin? Given that these infrastructure deficits are happening just about at every level, let me first ask, do engineers, the people you represent, also get involved on the air side and on the rail side, etc., or is this purely on the road side?

Mr. Claude Paul Boivin: All aspects.

Mr. Stan Keyes: So you're representing all of them.

I guess the difficulty any government would have would be to decide where to spend the money first. You're asking us to prioritize, but have engineers, who work in all modes, ever prioritized for themselves where the money would be best spent first--roads, air, rail, high-speed rail, etc.?

Mr. Claude Paul Boivin: In the budget last year there was a provision for the creation of an infrastructure foundation. Now, that did not come to pass; the decision was reversed at the time. However, there was one structure that was supposed to look at what the infrastructure needs were across Canada and across sectors, whether it's transportation, highways, municipal, or transit systems.

Nothing was selected in the end; however, a mechanism like that could be set up where you would do an inventory of all the infrastructure needs and then you'd tap into the strategic infrastructure fund.

Peter, did you want to add anything?

º (1650)

Mr. Peter Boyd: Claude, that's very precise, but just let me say in addition that we favour a balanced system; we don't give priority to one mode over another. The reason for that is it depends on what parameter is important. If it's safety, one mode will take the place. It could be volume, speed--

A voice: Environmental.

Mr. Peter Boyd: Or environmental, definitely. But we do favour a balanced system.

I think it's always instructive to look at European countries in this aspect. We always see European countries as being great advocates of transit and bicycles, yet most European countries--Italy, France, the Netherlands--have an outstanding freeway network, something that in relation to ours is the envy. So they have the balanced system.

Mr. Stan Keyes: It's always more outstanding in Europe, where fewer people use roads; more use trains. And you have the population base to support a train system, etc. There are all those influences that take place.

But you can understand the dilemma of a government if highways are in need of, what was it you said, $44 billion overall, air is in need of I don't know how many billion, rail is in need of how many billion, and our seaway system, especially the canal system, is in need of an upgrade and so many billion. So if we're going to provide equality among all modes, even if you're conservative--small “c”--on all the modes and on how much money you want to deliver to each, the bill is going to be astronomical.

So who do you start with? That's why I'm asking. You can't just say we were going to give, say, to be kind, $8 billion to transportation. Is that $8 billion split among four modes, or is that $8 billion going to highways or air or rail or seaway first? This is the prioritizing we have to do.

Mr. Claude Paul Boivin: In our first recommendation we say that priorities should be based first on the health and safety of Canadians--water would probably be one of those that would have to be weighed--and then on the economic benefits to the country. Maybe that's a starting point.

We recognize that not everything can be done right away. But if there's a strategic plan for 15 years, then maybe we'll know what to get done in the first five years--all things that touch health and safety.

Mr. Stan Keyes: I'm agreeing with that; I heard you earlier. I'm just wondering if you've done that.

Mr. Claude Paul Boivin: No.

Mr. Stan Keyes: Do you have a recommendation?

Mr. Claude Paul Boivin: Our recommendation is that it is not for us to make those decisions. It is for us to participate, as an industry, in the studies that will be done on it. But it's a political and economic decision.

Mr. Stan Keyes: Just to give you some level of confidence on your recommendation 4, that the nationalhighway system is critical to Canada's economic competitiveness, I think the Government of Canada has recognized that, providing, as we have, $2 billion through the strategic infrastructure fund.

So I think there is a recognition in understanding that there is an economic link to a transportation link and that we have to be very sensitive to needs--for example, our goods travelling to the U.S. So we need improvements at Fort Erie, at Niagara, and at other border crossings across the country, and the importance that has been identified with routes like Route 175 and Autoroute 30, two infrastructure priorities in Quebec.

That is being done on an ongoing basis, but you only have so much money in your pocket, and there are so many demands on that money. So if you're dealing with the demands of health care and the Department of National Defence, all the demands of government, or you're going to lay down some new asphalt or concrete on a piece of road....

I like the way you think in recommendation 5 when you say, let's start reaching for some blue sky, when you say “use of newer funding mechanisms”.

We have in north Toronto, for example, Highway 407, a concrete highway. You zip right along that piece of highway. It cost me $2 to go to the airport. It's free on Highway 401, but it's jammed. It's free on the Queen Elizabeth Way; that's jammed. But I can get to the airport quickly for $2.

Is this what you're talking about when you say “newer funding mechanisms”, toll roads?

º (1655)

Mr. Peter Boyd: Yes, that's part of it, public-private partnerships. Highway 407, as you are aware, is completely self-funding because of the volume.

Mr. Stan Keyes: Why we sold it, I never knew. We should have held on to it--or the provincial government should have.

Mr. Peter Boyd: No comment.

But there are many routes that don't have the volumes to be self-sufficient. The revenue stream is not there, but that doesn't rule out some form of public-private partnership, some funding from government and some private sector initiative.

Mr. Stan Keyes: Or with a successful highway, like Highway 407, taking some of that money and applying it to the less travelled routes.

Mr. Peter Boyd: Perhaps, but you'd need a lot to do so.

Mr. Stan Keyes: Hasn't it been demonstrated on Highway 407, where it's going to be making a profit like crazy in the next decade and longer?

Mr. Peter Boyd: Yes, but it didn't make any in the first run, I think.

Mr. Stan Keyes: Oh no, who makes any money on the first one? But now, today, if you had a chance to buy it, you would buy it yourself. You would buy that thing back in a heartbeat.

Mr. Peter Boyd: It would be a good investment. I doubt if they're recouping their money in the first five years or anything.

Hong Kong has toll roads and tunnels that recoup and pay themselves on a five-, to seven- to ten-year basis, but they're rather unique in the world, and then of course they're returned to the government.

Mr. Pierre-André Dugas: But still, when we wrote down recommendation 5, we had, at the same time, some aspect of it where there should be a fund somewhere. It should be funded so that people can do some planning on what should be done in the next five years, because the problem here is that every year they don't know what they're going to get. They don't even know where they're going to spend the money. They're trying to spend money now on things that are cheap, or that they think are cheap, but there's not that much result. It won't be good for ten years. It's going to be good for one year, two years....

So it seems that a good plan with long-term financing would be the best thing to do. That's why we're saying that.

Some of it can be toll. We have to find a way to dedicate the funds so they would know that in two, three, or four years, they're going to do something.

Mr. Stan Keyes: Thank you.

[Translation]

The Vice-Chair (Mr. James Moore): Mr. Laframboise, you now have the floor for 10 minutes.

Mr. Mario Laframboise: Thank you, Mr. Chairman.

In relation to Mr. Keyes' questions, I would like to point out that I personally do not see the problems of this government in the same light. The questions I asked previous witnesses were designed to get them to clearly state that we must look at the possibility of reinvesting a proportion of the excise tax on gas. The only tax that we are looking at is this one.

The amount the federal government spends on transportation as a whole accounts for 23.2 per cent of this excise tax. Therefore, a little over 75 per cent of this excise tax goes into other government revenue funds and is spent in other areas rather than transport.

We are not talking here about the GST or the Quebec sales tax on gas. We're specifically considering the 10¢ excise tax on gas. I have some figures for you. In Quebec, the federal government collects a little over $900 million in gas taxes. Since 1996, approximately $100 million have been reinvested annually in the highway network. However over the last couple of years, only $60 million have been allocated to this issue. Consequently, you can ask for as much money as you want from the federal government, there will always be enough left over for Kyoto and other issues. They have the money. There's no issue about that.

However, the fact remains that there is a very significant disparity between the federal government and the provinces, at least in the case of Quebec, which reinvests 96.7 per cent of its excise tax revenue in the transportation system as a whole. Therefore, as you can see, there is a very major disparity here. There is leeway available which would enable you to reach your goals.

You have said that you would like to see a program spread over 15 years. Personally, I agree with that statement. However, you have estimated that some $17.2 billion need to be allocated to the transport network over the coming 15 years. Am I correct when I say that?

Mr. Claude Paul Boivin: This figure represents the current deficit.

Mr. Mario Laframboise: The current deficit, right.

Mr. Claude Paul Boivin: Possibly about a billion dollars a year.

» (1700)

Mr. Mario Laframboise: Consequently, you are estimating that approximately one billion dollars per year needs to be...

Mr. Claude Paul Boivin: What we want to see is at least $500 million a year, and preferably a billion dollars for the highway system.

Mr. Mario Laframboise: Are you including the construction of new roads in that? I am thinking about highways 30, 35, 50, 185 and 175 in Quebec.

Mr. Pierre-André Dugas: This figure only covers maintenance needs. For the time being, the increased funding that we are demanding would be for maintenance only. This figure does not cover road construction or extension. It only relates to road maintenance. I think that it goes without saying that we don't believe that we should build a highway from one end of Canada to the other. However, we believe that as things stand now, if we are to halt the progressive, yearly disintegration of the infrastructure system, we need an extra billion dollars annually. Therefore, a total of $17 billion. It's peanuts.

Mr. Mario Laframboise: Therefore, this would be the money that it would take just to maintain the current network.

Mr. Pierre-André Dugas: Twenty or so years ago when Canadian governments faced their first financial crunch, most of them opted to rein in spending. This is nothing new. This all began in the 1980s. The first crunch in the 1980s resulted in most levels of government cutting investments in maintenance. These governments were strapped for cash and this is why they chose to invest in other areas. However, for every year that investment in the transportation system was postponed, the amount that would eventually have to be spent on infrastructure doubled. The problem was that the monies allocated to transportation infrastructure didn't keep up with that the following year.

It is for all of these reasons that our transportation infrastructure is now in the pitiful stage that it's in, and we have to update it now. I haven't even mentioned all the regulations that should be implemented. As my colleague said earlier, a part of the network was built in the 1950s and 1960s. Standards have changed since then.

Changes have to be made to the bend radius and grades. For those of you who know Quebec well, we haven't yet talked about infrastructures in Montreal. You should not forget that the boulevard Métropolitain was built in the mid-1950s. The bends were designed for automobiles moving at 50 kilometres an hour. It goes without saying that this does not comply with current security regulations. There are all sorts of other shortcomings too. The situation is much the same throughout Canada.

Mr. Mario Laframboise: You talked earlier about the level of deterioration of the highway network, in terms of speed limits. You put this at 38 per cent. Is that what you said in fact?

Mr. Pierre-André Dugas: Yes, 38 per cent for the whole highway network. However, in terms of a whole host of factors such as safety standards, inconvenience and driving quality, you'll find that in most provinces deterioration rates are somewhere around 30 per cent. If you look at the American highway network, their figures are somewhere around 8 per cent. The difference is quite striking. Twenty years ago, our rate here in Canada was 8 per cent, but just as in many other areas, it was difficult for us to maintain this level.

Mr. Mario Laframboise: Would the $17.2 billion you talked about allow you to get back to a reasonable level, or would it only be enough to maintain the current level?

Mr. Pierre-André Dugas: This would be just enough to bring us up to a reasonable level. We would not have any money left over for anything else.

Mr. Mario Laframboise: How much could you shave off that 38 per cent level? Could you lower it to 8 per cent?

Mr. Pierre-André Dugas: It would be possible to bring it down to 8 per cent.

Mr. Mario Laframboise: What could you do with $17.2 billion?

Mr. Pierre-André Dugas: With $17.2 billion, we would be able, over a 15-year period, to lower the deterioration rate to 8 per cent or so. However, time is of the essence.

Mr. Mario Laframboise: I can well understand that. Consequently, it is important and pressing for you to get a clear, well-defined program.

As for the $17.2 billion that you mentioned, that would not only be federal money. Money could also come from the provinces and even the municipalities in some cases. Obviously, not every network... Consequently, this money does not include new road development, for which there would have to be a separate envelope.

Mr. Pierre-André Dugas: That all depends on the decisions that you make.

Mr. Mario Laframboise: Quite. As I have already said, in light of the revenue from the excise tax, which at the outset was supposed to be reinvested in transportation, I think that the federal government has quite a lot of wiggle room here. However, that all depends on it showing good faith. As I see things today, that's what you are asking of the government. You want it to show good faith.

You also mentioned that last year's budget provided for a highway infrastructure fund and also referred to infrastructure in more general terms.

Mr. Pierre-André Dugas: Strategic infrastructure.

Mr. Mario Laframboise: In your opinion, was the Strategic Infrastructure Fund like this foundation?

Mr. Claude Paul Boivin: The Strategic Infrastructure Fund replaced the foundation. The foundation was to be at arm's length. It was announced in the budget, but I believe that a month after the budget, there was a change in plans, and now we have the Strategic Infrastructure Fund.

Mr. Mario Laframboise: If there were more money, be it in the form of a fund or a foundation, would that make a difference?

Mr. Claude Paul Boivin: No. The foundation would enable us, however, to work at arm's length to identify priorities. Therefore, what we need is this type of initiative, perhaps even within the department. Right now we have an infrastructure branch. You could even set up the foundation within the existing branch.

» (1705)

Mr. Mario Laframboise: Any body of this type would of course have to respect the jurisdiction of the province and the municipalities, right?

Mr. Claude Paul Boivin: Absolutely, entirely.

Mr. Mario Laframboise: In your capacity as an engineer, you have probably worked on traditional infrastructure programs. I am not referring here to strategic infrastructure because I'm not even sure if the money has been invested in this area yet. You have undoubtedly worked with other municipal, provincial and federal infrastructure funds. Did you find their way of dealing with projects efficient?

[English]

Mr. Peter Boyd: I think in the way programs in Canada and in North America are balanced between new construction, rehabilitation, and maintenance, it's well managed.

The problem that is consistently coming to the fore, particularly in Canada, at all levels, is lack of money. There's no shortage of skills and ability to put in place good strategies for rehabilitation, good strategies for maintenance, good strategies for upgrading and safety.

Unfortunately, Monsieur Laframboise, it comes down to a question of dollars. It's a problem at virtually all levels of government and in all provinces.

[Translation]

Mr. Mario Laframboise: Would you like to see a larger program? On the issue of the strategic infrastructure program, I think you are quite right when you say that only about a quarter of funding will be allocated to highways, because obviously, there are other projects. The figure of $500 million for Canada as a whole has been mentioned. This means that there would not be much money for highways. Don't you think that it would appropriate to set up an infrastructure fund specifically for the highway network, or do you think that that would be too much to hope for?

Mr. Pierre-André Dugas: No, I don't think that that would be over the top. I think this is one of the major problems we are facing. Each component of the transportation system is saying that it needs a fund of its own. Of course, the whole issue here is predicting what the future holds. Building new roads and maintaining existing ones is all well and good, but the major problem we are facing is that in order to be able to maintain the highway system, we have to start anticipating future needs very early. To date, successive governments have had to face the same problem. How to effectively maintain the water supply system, for example. Let's look at the example of the water system, to get us away from always talking about roads; however, the same issues apply.

Mr. Mario Laframboise: Take Montreal, for example.

Mr. Pierre-André Dugas: Yes, Montreal, but Montreal is a completely different kettle of fish. Let's look at a standard network built in the 1960s, and which is, therefore, 40 years old. It goes without saying that a 40-year-old network needs investment if it is to be properly maintained, even if it was very solidly built at the time. The water system is no longer in a good state of repair. I am only referring to those systems which are 40 or 60 years old. The Montreal system for example is 100 years old. Some jurisdictions have adopted an approach whereby they are forcing local authorities to keep back part of the municipal taxes they levy for investments that will be needed in 20 years or so. That is a long-term approach, but you have to look at the issue along these lines, because if you don't we will never have enough money and we will be forced to beg for additional money on a yearly basis. If you don't set aside money for renewal projects in 20 years time, the same problems are going to occur over the next 20 years. This is what we are saying. We are not specifying where this money has to come from, because it's not up to us but rather up to you to make that decision. However, we are saying that you have to do more and allocate funds. This is an issue that needs to be addressed right now.

We might be told that there is no money available, but 1¢ today might be worth 10¢ tomorrow. Consequently, we have to get going some time. Maintaining the various networks we have is just like the way an RRSP works. If you don't start at some point setting aside money to upgrade the system, then the problems will never be addressed. I would even go so far as to say that no new infrastructure should be designed if no money has been set aside for maintaining this infrastructure 25 or 30 years down the line.

[English]

The Vice-Chair (Mr. James Moore): We have 20 minutes remaining. We have four members who still wish to speak.

So you have 10 minutes, but if you want to make it shorter it would be appreciated.

Mr. Bagnell, the next allotment is yours.

Mr. Larry Bagnell (Yukon, Lib.): Thank you for coming.

As you know, the way the budget exists and works, because this has been brought up, revenues are not attached to expenses so all the revenues come in and then Canada decides what's important. So if it's a 20-year program, if we're feeding someone, we don't cut them off or turn off their hospital machine because we aren't getting certain sorts of revenues. It just doesn't work that way.

I might have missed this, sorry, because I came in late. You were comparing the United States and Canada on their highway systems.

In comparison with the United States, could you list the top half a dozen or so countries in relation to highways and where Canada fits in?

» (1710)

Mr. Pierre-André Dugas: Normally we start with most of the countries in Europe. We go to France. We go to Germany. We go to all these countries. We're going to see a good level of service on the highway system...Australia. I wouldn't say that for all of them. And after that, you would say that the United States still has the best one.

Mr. Larry Bagnell: When I've been in Europe the highways were a lot more crowded. I would much rather drive in Canada. For me, our system is better.

Mr. Pierre-André Dugas: Yes, because we have a wide system. We don't have as many vehicles on the road as they have, but the difference is they have more money to put into the roads than we have. In France most of the highways are toll highways. France is crossed over by people from Germany going to Italy or going to Spain. Their network is young.

Mr. Larry Bagnell: So you're suggesting we should have more toll highways?

Mr. Pierre-André Dugas: Well, it could be a way of dealing with that problem.

Mr. Larry Bagnell: And in spite of the fact that they have more money for highways in total, because they have more people, do they have more money per capita? Obviously we spend a lot per capita on highways because we have so far to go.

Mr. Pierre-André Dugas: Yes, they spend more per capita than we spend.

They had to do something about their network because after the war they didn't have any highways or anything. They needed a good network so they tried to do it on their own, the way we did it in Canada.

We did a nice job in the 1960s and 1970s. We built most of our network in the 1960s and 1970s, and that was great. We paid cash for it, but we didn't put any money aside to keep it going.

At the same time, if we had built it that way and we had given it to a company to look after the maintenance, it probably would be in good health today, because they would have put some tolls on the highway and they would have got some money on the road.

Mr. Claude Paul Boivin: The United States spends $110 per capita. That's over 20 times what we spend on highways in Canada, which is about $5 per capita.

Mr. Larry Bagnell: My area is Yukon. We're planning a megaproject--we're hoping--to join the railway between Alaska and B.C. There's nothing wrong with that.

A voice: That's good.

Mr. Larry Bagnell: That's good. Okay.

Do the three levels of government--municipal, provincial, and federal--take enough advantage of the techniques for preserving highways? My understanding is if you resurface a highway early enough, even though the taxpayer may be asking why you are doing that already, you save a lot more than if you wait longer.

Do you find the three levels of government are effective enough in their techniques, engineering, and knowledge that they're using their money to their best advantage?

Mr. Pierre-André Dugas: I think they have the technique but they don't have the money. It's always the same problem when you stop putting money into maintenance. We started doing that 20 years ago all over Canada. It might differ from one province to the other depending on their priorities. The year after you start doing that you have to put in more money, the next year don't, and so on. Finally the snowplow won't--ça ne fondra pas au soleil. It's going to stay there.

Mr. Larry Bagnell: I'm finished, so others can go ahead.

The Vice-Chair (Mr. James Moore): Thank you.

Mr. Barnes.

Mr. Rex Barnes: Thank you very much.

First, I'm not a true supporter of tolls. I think tolls have a negative effect, but I'm always open to new ideas and suggestions. However, when we talk about a national highway system I don't think anyone in their right mind is against that. It comes down to dollars and cents again, as we've said.

How do you see the urban versus the rural areas fitting together? You could have a national highway system that went through basically urban centres, but Canada has some of the best tourism potential in the world, and probably 80%--I'll say that just as a figure--is in rural areas. How do you think the money should be spent connecting--from a national highway system perspective?

» (1715)

Mr. Pierre-André Dugas: If you look at the complete system--and as you said, we're not for tolls--we have to dedicate some funding somewhere because it's always the same problem every year. We can't get money in the budget. You're going to cut funds for roads before you cut funds for hospitals, for sure. Sometimes it doesn't cost that much.

If you will permit, I will just give you some information I know. When they decided in 1980 to let the Office des autoroutes du Québec go it was a small thing. They only had three roads. They had Highways 40, 10, and 15. They were bringing into the government $70 million a year. That was a lot of money because the budget at that time was only $400 million a year.

If you used that money from part of the province or the system and distributed it, everybody gained. At that time it only cost 10¢ at rush hour--not even 25¢. Those things were there, and because only two or three highways had them they decided to put them away. That was a good thing because only three or four groups of people were paying for them. If we had just looked at them overall, we probably wouldn't have been able to finance most of them--well, part of them--today because they cost a lot more.

Mr. Rex Barnes: I might be convinced from a rural perspective if the tolls weren't too highly administered and any money raised through tolls went into the highways. But governments being governments, regardless of who's there, they will use it for debt reduction, put it into the surplus, make it look good for health care, or make it look good for other things. Then it would defeat the purpose. It would have to go for a defined purpose.

Probably down the road having tolls in the bigger centres is going to be a way of life because it's easier, as Stan was saying, for transportation purposes. It might take you only a couple of minutes to get to the airport on a toll road when other roads are all blocked up. That's the purpose. So you pay your dollars, take your chances, and get there quicker.

Tolls may work, but I would have to be guided a bit more down the road. They would have to go toward highway infrastructure development, to ensure we had proper highways that were safe.

The Vice-Chair (Mr. James Moore): Thank you.

[Translation]

Ms. Frulla, you have the floor.

Ms. Liza Frulla: Thank you, Mr. Boivin and Mr. Dugas.

I always get somewhat uneasy when we start comparing Canada with Europe or the United States, just because of the differences in population distribution. Canada is a huge country and in some cases, vast portions of it are relatively sparsely populated. Consequently, the problems we face here are quite different. Then there is the whole issue of the climate, which we referred to earlier, which does not make things easier, especially from a highway point of view. Consequently, we have a very complex issue here.

Now, you have suggested that part of the solution would be stable and indexed funding along with a strategic plan over 15 years for example. Do you think that would be the best solution?

» (1720)

Mr. Pierre-André Dugas: Yes, because currently, I think all jurisdictions throughout Canada, be they at the federal or provincial level, have to play a role. However, in light of the fact that highways are a matter of provincial jurisdiction, as we have already seen, I believe that the provinces already know the state that their highway network is in. I think that some of them are quite organized and that they already have a fair idea of the scale of problems they're facing.

Ms. Liza Frulla: In 1992, for example, it was already realized that by 2010, moving about Montreal by car would be almost impossible. In 1992, presentations were made about forecasts for Montreal, and other cities, in 2010. As you have said yourself, highways are a provincial responsibility, but I'm glad to see that Mr. Laframboise said—I agree with you, but also with him—that the solution lies in specific funds allocated to various components of the transportation system. In the 2001 budget, we had the infrastructure fund, but the provinces came out against that approach. The most stiff opposition came, as is usually the case, from Quebec, on the grounds that highways were a provincial jurisdiction.

From what you have said, there needs to be close cooperation between the federal government, the provinces and municipalities. I think that that is part of the solution. We need stable funding, a strategic plan over 15 years and genuine cooperation at the three levels of government, because I think that all three levels of government are involved in this. Of course, the federal government offloads onto the provincial government and the provincial government offloads in turn onto the municipal governments, with the result that we have roads in the state that they're in in Quebec.

Mr. Pierre-André Dugas: Recommendation 5 reads as follows:

That the federal government show leadership towards the National Highway System by encouraging the use of newer funding mechanisms...

The idea of tolls has been bandied about, but we don't necessarily need to do that, there are other ways of providing funding.

...and by the utilization of transfer mechanisms tied to the achievement of security and level of service objectives...

I think that in terms of transportation, this is precisely the federal government's role, no matter what jurisdiction you're talking about, as you have in fact stated, they have specific obligations that they have to meet. They know their stuff.

However, I think that all jurisdictions are capable of choosing a direction. I don't think that any province would be opposed to improving service. This improvement might vary from one province to the next, but we have to at least try to improve on the current situation.

Ms. Liza Frulla: That is quite desirable.

Mr. Pierre-André Dugas: I think that it is in fact quite desirable.

Ms. Liza Frulla: It just wouldn't be desirable. It's something we need for everyone's safety. Is it acceptable? That's something else again.

Mr. Pierre-André Dugas: Sometimes you think you have to be an operator to act. I don't think so. You can plan and do things that will be good.

Ms. Liza Frulla: I'm coming back to the funding mechanism. I know that at the provincial level it was examined and considered. There was talk of partnership, for example. I remember that we'd examined the possibility of partnering with SNC-Lavalin, for example, for some roads.

I understand Rex Barnes when we start talking about tolls, especially in some provinces where it might be more of a problem. In your opinion, isn't that inevitable in some way if we take into account the premise, as a starting point, that we're 33 million people on a territory that's quite huge and where the traffic flow and density aren't the same thing as in Europe or the U.S.?

Mr. Pierre-André Dugas: It's just a matter of source of funding. Tolls are one way to get money, but there are different ways to do it. When the Minister of Finance looks at all the envelopes, it's hard for him to say that he's going to put so much money into such an envelope. It's rather a bother when a problem comes up in another area. However, all administrations in the world that have managed to maintain infrastructures—and I'm saying infrastructures simply not to choose one over the other—are the ones who put money into them. That's the only way to do it. In the U.S., in the 1980s, Reagan put on a 5¢ per gallon tax to set up a maintenance fund.

Ms. Liza Frulla: That's it.

Mr. Pierre-André Dugas: Besides tolls, there are other ways to fund things. We just have to decide to make a priority of it some day. That's what we need.

» (1725)

Ms. Liza Frulla: But it can be done.

[English]

Rex, you were right when you said governments are what they are at different levels. But if you look at the example of the agency called

[Translation]

the Agence métropolitaine de transport, the AMT, in Montreal...

[English]

they sort of look at the overall Montreal area and they perceive certain fees,

[Translation]

registration for Montreal.

[English]

Then 1.5¢ goes to

[Translation]

the network, and there's a bit more for public transport. So through the agency we do collect certain funds that are recurrent and dedicated.

[English]

So it's feasible within the province and the competence of the province.

Mr. Pierre-André Dugas: It's not their only source. They have the 1.5¢ on that, and the municipality gives them some money for investments, so they have more than one source.

Mr. Rex Barnes: Governments always go for the easy route, and having tolls is the easy route out most times.

[Translation]

Ms. Liza Frulla: But we understand the urgency of the situation. It's being discussed at all levels. Now, we have to act because our roads are in a pitiful state. It's a rather urgent matter.

[English]

The Vice-Chair (Mr. James Moore): Thank you very much.

Thank you, Mr. Dugas and Mr. Boivin. Please extend our great thanks as well to Mr. Boyd for appearing before us today.

[Translation]

Mr. Marcel Proulx (Hull—Aylmer, Lib.): I'd like to make a suggestion. I've taken out the list of witnesses and I think there's something missing in the sense that we should invite the specialists from the Department of Transport to come here and discuss their vision and planning with us so we'll have their input in our study. So I would suggest inviting the Department of Transport.

The Vice-Chair (Mr. James Moore): As soon as possible before the budget?

Mr. Marcel Proulx: The budget is next Tuesday so it would almost have to be Wednesday or maybe even Monday. Monday is before the budget but it's a bit late, Mr. Chairman.

[English]

The Vice-Chair (Mr. James Moore): Can we ask the clerk to contact the people who will come back before the committee? If it is feasible, we'll have them back as soon as possible. Are there any objections from the members? No?

Mario.

[Translation]

Mr. Mario Laframboise: There are witnesses that are going to be coming Wednesday. Are we going to prolong our meeting?

Mr. Marcel Proulx: Either that or hear our witnesses based on a priority list. Who can have the greatest impact before the budget? Witnesses or people from the department? How do we want to do that?

The Vice-Chair (Mr. James Moore): We can always play around a bit with that if we can.

Mr. Marcel Proulx: Yes. I'm surprised that we didn't take the initiative of asking what the department's position is, but anyway.

Mr. Mario Laframboise: I'm sorry, but when I tabled the list of witnesses, I asked for Mr. Collenette to appear.

Mr. Marcel Proulx: I have not seen that list.

Mr. Mario Laframboise: I asked that the minister appear. If he has not been reached...

Mr. Marcel Proulx: I was not aware of that, Mr. Laframboise.

Mr. Mario Laframboise: We will be hearing from witnesses on Wednesday. I don't mind extending Wednesday's meeting by an hour; I have no problem with that.

Mr. Marcel Proulx: It's not a problem. Perhaps you made the request. But I think that if we want to talk about the sex life of mosquitoes, we should ask mosquitoes themselves.

Mr. Mario Laframboise: Yes, that's right.

The Vice-Chair (Mr. James Moore): Since the budget will be presented next Tuesday, it might be more appropriate to ask for Mr. Collenette to appear before the committee after the budget is delivered so he can tell us about his department's priorities. That may be more appropriate. But if no one has a problem with the witness proposed by Mr. Proulx, perhaps we can have a report at the next meeting. If no one has a problem with that, then our work for the day is done.

Mr. Marcel Proulx: So, we will ask department officials to come on Wednesday?

The Vice-Chair (Mr. James Moore): Yes, this Wednesday or next Monday.

Mr. Marcel Proulx: Fine.

» (1730)

[English]

The Vice-Chair (Mr. James Moore): Thank you. This meeting is adjourned.