Thank you very much, Mr. Chairman.
Before I begin my formal remarks, I would like to say that of course I'm happy to be here early in this new session, and I want to congratulate you, as well as the two vice-chairs of the committee, for your election. And to the new members and the veterans, I look forward to working with you all.
I'm pleased to appear before the SCOTIC committee today to discuss Bill C-8, which improves the shipper protection provisions of the Canada Transportation Act. These are the provisions that deal with the potential abuse of market power by the railways.
I have with me today Helena Borges, director general of surface transportation policy, and Alain Langlois,
our legal counsel.
Bill C-8 is the reinstated version of the former , which had been referred to this committee before the previous session of Parliament was dissolved. It is the third and final bill amending the Canada Transportation Act. These bills have all been based on extensive consultations dating back to the statutory review of the CTA that took place in 2000 and 2001.
, the International Bridges and Tunnels Act, received royal assent in February of 2007. As well, , which amended provisions related to the Canadian Transportation Agency, air travel, mergers and acquisitions, rail passenger services, railway noise and the grain revenue cap, received royal assent in June of this year.
, by far, is the shortest of the three bills. However, it is extremely important to rail shippers, the hundreds of companies that use railways to ship their goods. This bill is also important for the growth of international trade and the competitiveness of our economy as we experience unprecedented levels of trade with the Asia Pacific region. The bill will provide the regulatory stability that the railways have been seeking, which will, in turn, ensure that much-needed capacity investments are made on the key trade corridors. Improved capacity will help our railway industry and shippers to remain competitive with their counterparts in the United States.
I am sure that most of you have heard many complaints from shippers about railway service and rates. Shippers are looking for stronger statutory remedies to improve their leverage in negotiations with railways. I had very positive feedback from shippers on the former Bill. Shippers expressed strong support for it to be reinstated and passed as quickly as possible.
The railways feel that Bill reintroduces too much unnecessary regulation. I believe that it establishes a better balance between shippers and railways. Passage of the bill will put an end to the extensive debates that have taken place and will provide both sides with regulatory stability.
When I announced tabling of the former Bill on May 30, 2007, I also indicated that the government would conduct a review of railway service to commence within 30 days after the bill is passed. I will speak more on this later.
These two initiatives, Billplus a review of railway service, fulfill an important commitment I made to shippers: that I would address their concerns about railway service and rates.
The CTA is the legislative framework that regulates the economic activities of the railways. The act generally relies on market forces to govern the relationship between shippers and railways. However, as I noted earlier, there are a number of sections that protect shippers from the potential abuse of market power by the railways.
I want to note that the legislative and policy framework for railways in Canada has worked quite well. CP and CN are among the most efficient railways in the world. They both operate networks in the United States and compete quite successfully against their U.S. counterparts. They don't require any operating subsidies from government. Their financial success means they have the capital funds necessary to maintain and expand their infrastructure and to acquire new equipment.
While the framework has worked well, it's not perfect. Transport Canada officials have heard increasing complaints over the last few years about poor railway service and high freight rates. I have heard many similar complaints in my capacity as minister. Also, I know that many members of the previous committee heard from shippers and others, even when the former was being reviewed by the committee and the House.
These complaints may stem from the strong performance of the Canadian economy and the fact that the supply of transportation services, including rail freight services, has been quite tight relative to demand throughout North America. Railways are of critical importance to many Canadian shippers in domestic, continental, and international markets, especially to shippers of bulk commodities, who often don't have any practical alternatives. Shippers need reasonable access to efficient and reliable service at fair rates.
I believe the time has come to rebalance the legislative framework in favour of shippers.
During the consultative process in the summer of 2006, I encouraged the railways to develop a commercial solution that would complement amendments to the shipper protection provisions. The railways developed a commercial dispute resolution proposal for discussion with shippers. Significant progress was made. Unfortunately, the two sides were unable to reach agreement. I still support a commercial approach, since it would be more expeditious, less costly, and less confrontational than regulatory remedies.
With your permission, I would like to briefly describe the provisions in the bill.
The existing section 27 of the act requires the agency to be satisfied that the shipper would suffer substantial commercial harm before granting a remedy. Shippers have long objected to this test. It is being dropped under Bill.
The bill amends the notice that a railway must give for increasing freight rates from 20 days to 30 days. This will provide more time for shippers to make the necessary adjustments to their shipping plans.
There are two new provisions that deal with shippers' concerns about railway freight rates and ancillary charges. I want to clarify the difference between these two terms, since different remedies apply to each.
I'll deal with freight rates first, since it is the easier concept to understand. Freight rates are simple rates applied to the movement of traffic from point A to point B, for example, for moving wheat from Moose Jaw to Vancouver.
When you look at the various rates and charges levied by railways, the payment for freight rates are the big-ticket item. Now, I want to point out that the intended remedy for freight rates is final offer arbitration.
Aside from the rate application applicable to the movement of traffic, railways levy various other charges. These charges can either be levied in relation to the movement of traffic or in relation to the provision of non-typical railway services provided by the railways.
Now, the best example of a charge that may be imposed by a railway in relation to the movement of traffic is demurrage, which is the amount paid when cars are not loaded or unloaded within the free time provided by the railways. Examples of charges that may be imposed in relation to non-typical railway services provided by a railway include car cleaning, weighing, or storing of the cars.
The amounts paid by shippers for the various charges imposed by a railway are less significant than that amount stemming from the applicable rate for the movement of traffic. However these charges have become an issue with shippers over the last few years. Amongst the concern frequently heard is the fact that these charges, or their associated terms and conditions, are unilaterally established by railways and are often unreasonable in light of their purpose.
With respect to these charges, a new provision is being added that will give the agency the authority, upon complaint by one or more shippers, to review such charges and associated terms and conditions that are contained in a tariff of general application. Now, the agency is also given the authority to order the railway to amend the tariff if it finds the charges or associated terms and conditions to be unreasonable.
The bill contains a number of factors to guide the agency. The agency will determine the period of time any revised tariff will be in effect, provided that such a period does not exceed one year.
Shippers were hoping that the issue of charges could be addressed through changes to the final offer arbitration (FOA) provisions. In our view, the agency review approach is more effective. It provides for a “one-stop shop“ to address complaints. The FOA approach could require a number of FOA applications to accomplish the same thing, because FOA decisions are normally limited to the applicants.
The FOA provision is one of the more popular shipper remedies. A shipper can apply to the agency for FOA if the shipper is not satisfied with the railway's freight rates for the movement of traffic or any of the associated terms and conditions. Under FOA, the railway and shipper each make their final offer, and the arbitrator selects one of them without modification. This encourages the two sides to narrow their differences.
Bill expands the availability of the FOA remedy to a group of shippers. In order to qualify for group FOA...
Editorial Note: technical difficulties
I was saying that this is to ensure that both the matter and the offer are common. Without sufficient commonality, the group FOA would simply be a series of individual FOAs with little in common. This would be unworkable and unfair to the arbitrator.
Group FOA is a new concept, and will undoubtedly be subject to challenges as the parties seek to clarify what is meant by "a matter being common to all shippers" and "a joint offer, the terms of which apply to all of them". We will have to rely on the good judgment of the Canadian Transportation Agency and the courts. I want to emphasize, however, that this is a remedy that is aimed at helping shippers—it is quick, effective and less costly. There will be practical restrictions on what qualifies as an eligible group FOA to ensure that it be an effective and expedient remedy. However, it is not intended that shippers must be facing exactly the same circumstances in order to be eligible for group FOA.
Under the new group FOA provision, the agency must be satisfied that the members of the group have attempted to mediate the matter with the railway. This is consistent with the government's preference for encouraging commercial solutions before regulatory remedies are pursued.
permits parties to a single final offer arbitration to suspend the arbitration process by mutual agreement in order to pursue mediation. This provides both parties with an alternative without jeopardizing the shipper's right to final offer arbitration. The FOA process will resume if mediation fails.
Shippers strongly support group final offer arbitration and are eager to see it implemented.
ensures that the line transfer and discontinuance provisions apply to lines that are transferred to a provincial railway but revert back to the federal railway. This will ensure that interested parties, including governments, have an opportunity to acquire such lines before service is formally terminated. This provision closes a potential loophole.
A complementary provision requires CN or CPR to make payments to local municipalities if a grain-dependent branch line reverts and is subsequently closed. These payments are $10,000 per mile per year over a three-year period.
A new provision requires CN and CPR to maintain and advertise a list of sidings that grain producers use to load their own cars and to give 60 days' notice before closing such sidings.
I also want to speak briefly about the commitment to commence a review of railway service within 30 days of the bill being passed. This commitment has been a priority for shippers and has been well received by them.
The objective will be to focus on solutions to the problems that we have been hearing about for the past year or so. The review may include an assessment of the effectiveness of the level of service provisions of the Canada Transportation Act. We will be looking for innovative solutions to a challenging issue.
Shippers and railways will be consulted on the scope and terms of reference for the review. I expect Transport Canada to contact interested parties for their views later this year.
The government has taken significant steps to address shipper concerns through Bill and the railway service review. Many, if not most of us, have heard serious complaints about railway performance. Shippers have been waiting for these improvements for over five years and are very supportive of Bill C-8. They want this bill passed expeditiously.
For their part, the railways may object to some of the provisions but they want regulatory stability. I believe that Bill C-8 provides this and a better balance between shippers and railways.
We have an opportunity to take corrective action. I encourage members to support Bill C-8. I hope that once the bill is passed, shippers and railways will become re-engaged in discussions on a commercial dispute resolution mechanism.
Thank you very much for your attention.
Thank you, Minister, and members of the department.
Those of us from the official opposition find ourselves in a really felicitous situation, because we see before ourselves a bill that we presented 24 months ago, although it seems like only yesterday. I guess we were kind of hoping for a different type of legislation from a different government. But we want to compliment you on seeing the wisdom of some of the legislation that the Liberal government presented some 24 months ago. You probably think that's partisan of me but it isn't; it's just a little bit of a preamble.
When the predecessor to Bill C-8 came before the House last spring, we didn't really have much of an opportunity to debate it because it came very close to the end of the session. So you'll forgive me if I put some of the questions into a particular context.
I don't mean to chew up the time, but from our perspective Bill C-8 should focus—and our questions will focus—on the maintenance and growth of transportation infrastructure to help a very valuable sector and component of the Canadian domestic product, but also communities throughout Canada. So our interest in Bill C-8 will be determined in part by the extent to which all of the amendments nurture that growth or maintain the level of infrastructure required to allow our producers to be competitive as they are being more productive.
Secondly, we want to make sure there is protection of the interests of not just the shippers but the producers as well. As I said, we didn't have an opportunity to debate this at any great length in the House, and we probably won't be able to do that except here in committee, but that too is a concern.
The third major issue is competitiveness, and I'm not sure if what's in the bill is going to ensure that competitiveness. Minister, you alluded to the fact that you want to guarantee that the railway companies will be able to continue to offer a good quality of service, and encourage investment at any rate. I'm looking forward to seeing how the bill will do that. We'll probably get to do it in committee.
But there are two other issues, and I ask for your comments. One is on the way the bill is going to work out. On the question of service, you said you were going to initiate a review within 30 days of the passage of the legislation. I'd like to understand why you wouldn't do that right now.
Secondly, there's a clause that says shippers will no longer need to prove financial damage. I understand the reason why you wanted to put that in. I think you said you wanted to shift the balance back to the shippers. We want to make sure there isn't any frivolity in any of the issues, so I'd like you to address that.
Finally, the big concern for a lot of the smaller producers is the shutdown of lines. I was encouraged by one of your amendments that said you have to go through a process. Then I immediately took away my enthusiasm when it said that in the event that they go through the process and decide to shut the lines down anyway, you will make sure they return a fine to the local municipalities. That's great, but they will still be without service. That goes back to what I said earlier—that we want to make sure we maintain infrastructure, if not grow it.
I've gone on a little bit because we didn't have a chance to debate this at great length in the spring, but I'd like to have some of your comments in response to those concerns.
Thank you very much for your comments.
At the outset, let me say that I share the principles you put forward. I think we unanimously, on all sides of the House, want to see this industry grow. We all wish to see Canada become competitive.
I won't go into the initiatives we've taken over the last several months, but let me say at the outset that I am in complete agreement with you. The railway industry is thriving and prospering well. Both CPR and CN—pursuant, of course, to its privatization and commercialization—have been able to successfully continue their growth rate and become part of a larger marketplace, and certainly leaders in that marketplace in North America.
This having been said, of course, our concern—and your concern, as I understand it—is to make sure that our producers, with the shippers, are able to get the products to where they have to be so that they remain competitive. I think we're all in agreement with that.
Your first question wondered, why not do the service review now, rather than put it off for 30 days. It's my view, Mr. Volpe, that it's important that we get this legislation passed and that we focus on the piece of legislation. My officials have already begun preliminary discussions and laid the table, but we don't want to get off track. We want to make sure that once this is done we'll be able to focus all our attention on the service review.
It's precisely for that reason that we've decided to proceed in this manner. First things first: we get the piece of legislation through; then we settle the service review.
Regarding the second issue, the shutdown of lines, I'll ask Helena Borges to address it.
Mr. Minister, in your presentation, you make two important observations. In the fourth paragraph on page 2, you say, in connection with Bill , that:
|| the Bill is also important for the growth of international trade and the competitiveness of our economy, as we experience unprecedented levels of trade with the Asia-Pacific region.
This is a very important observation. But, since your government has never used any WTO provisions at all to curb unreasonable competition from foreign economies, we will be importing more. Then, clearly, the value of our dollar restricts our exports.
That brings me to your second observation. On the fourth page of page three, you say:
|| Transport Canada officials have heard increasing complaints over the last few years about poor railway service and high freight rates.
Tell me if my interpretation is correct. Bill probably will fix the problem of freight rates that are too high. That will provide help to our exporters, who are sorely in need of it. But it will not solve the other part of the problem, the mediocre railway services. You are going to start a review 30 days after the bill is passed. But until then, what will happen if the railway companies react badly to the decision on freight rates and decide to provide even worse service to firms that challenge those rates? Will they have to wait for the end of the review that will start in 30 days and end who knows when? You are telling us that the review will start 30 days after the bill, but you do not tell us when it will end. We must be able to address that issue. It is not impossible that the mediocre service provided by our railway multinationals, who control all rail service, will become even worse for anyone challenging the rates.
What do you think, Mr. Minister?
Thank you, Mr. Laframboise.
I have to say that you are quite right in your assessment of the essential reason for the bill. Costs are indeed too high, and I am sure that you will have seen that the bill also deals with the entire question of ancillary charges. Procedures are already being put in place that will allow these things to be corrected.
As I said in my answer to your colleague a few moments ago, what we want to do first and foremost is make sure that the final offer process can start as soon as the bill is passed and becomes law, with no further delay. The process itself gives our partners, the shippers especially, a guarantee that things are moving forward.
In the meantime, we have given them the undertaking that we will look at service levels. We will do this subsequently look that we are sure that we get that stage right. You asked me how long we think that it will take; my answer is about six months. But our shippers cannot be penalized in the meantime. Because of the mechanisms proposed in the bill, we can start to look at the financial aspects as soon as it is passed.
I am being handed a document here that lists the responsibilities of the railways. Basically, Mr. Laframboise, the service provisions of the bill place a host of service responsibilities on the railways. Specifically, they authorize the Canadian Transportation Agency to investigate complaints and provide it with the power to require corrective action if necessary. The bill does not change these provisions in the slightest. They are still there, but the government has undertaken to examine services, as the bill states. What follows clearly explains the act's provisions on service levels.
A railway's service obligation is that the railway company is required to furnish adequate and suitable accommodation for the receiving and loading of all traffic offered for carriage; to furnish adequate and suitable accommodation for the carriage, unloading and delivering of the traffic; to receive, carry and deliver the traffic without delay, and with due care and diligence; to furnish and use all proper appliances, accommodation and means necessary for receiving, loading, carrying, unloading and delivering the traffic; and to furnish any other service incidental to transportation that is customary or usual in connection with the business of a railway company. The traffic must be taken, carried to and from, and delivered on the payment of the lawfully payable rate.
You see that a railway company must provide people with suitable facilities for transporting, delivering and transferring of goods. And a company that has or operates a railway forming part of a line that links or intersects with another railway must also provide all reasonable facilities.
This is exactly what we want to review, but in the meantime, the other elements, that I hope the committee will move to adopt, will already be under way; there will already be a process designed to provide the basic balance and fairness, if you will, that we want to see in the market.
The level of service review is going to address the type of railway service that we have in Canada, and it will definitely compare to what is happening in the United States and Europe and Asia.
You should know, however, that both Canada and the United States have the most productive rail system of anywhere in the world because they are dedicated on rail lines for freight. Most of the other ones are sharing them with passenger. They don't have equivalent systems across countries. So when you're looking at a continent, even in Europe, they're not as efficient as they are in North America. But it will definitely look at that.
It's going to be looking at a variety of things, and we've already started discussions with the shippers, as the minister said, and the railways on the terms of reference. The kinds of things we want to look at are: what is the service they're providing today—what is the demand for the service; what are the kinds of cars; are they providing enough cars, not enough cars; what's the time it takes to get the product from origin to destination?
We're also going to be looking at the railway operations and the way that has evolved over the last few years when demand has been increasing a lot, and making sure that there aren't inefficiencies in the system there, so you get at the question of productivity and making sure that the products getting to the export market, particularly to the ports, are getting there as efficiently as possible and empty cars are returning as efficiently as possible.
We will probably be conducting it through an independent monitor who will get the data for us. We already have somebody engaged on the green sector. We want to do this for all the sectors of the economy--we're looking probably at 12 to 15 sectors--making sure that across the system we get a good measure of what's happening today and what we foresee in the future in terms of continued growth--can that service support the growth?
The issue of investment that you mentioned will come out of that discussion, because we will see whether or not the capacity that is in place today is sufficient capacity to address the needs of the future.
Thank you for your question, Mr. Jean.
I alluded at the very beginning of my presentation to the consultations that have been taking place. They go back to 2000-01. Shortly after I took office, I was made aware of the issues the shippers were facing, the complaints they were lodging. I met with the railway industry, and quite clearly action was required.
I have not heard of one shipper who is opposed to this piece of legislation. I think that all parliamentarians around the table have been made aware of those representations. We, as parliamentarians and lawmakers, have the obligation to correct a situation when we see that the situation, for multiple reasons, is not working.
We strongly believe that Canada needs to be competitive. We have to be able to get our products to their destination as soon as possible, as efficiently as possible. As a government, we have put forward a series of measures, whether it be the Atlantic Accord, whether it be the Ontario-Quebec Continental Gateway, the Asia Pacific Gateway, ways to seamlessly integrate our transportation network to assure our producers that our products are there. There are the port mergers in B.C., working with the authorities in Prince Rupert to make sure we can get our products to market as fast as possible. I think this government is dedicated to that principle. We've quite clearly indicated it in Advantage Canada, which the Minister of Finance has alluded to on numerous occasions. We're building our infrastructure. We're talking about short-line rail, and we want to be able to make sure that as a government, through the Building Canada Fund, we put the amounts of money that are required to make sure the infrastructure is there, and capable and efficient, to be able to undertake all these important tasks.
So, yes, to respond to your question, I haven't heard any shipper complain. They all want to be able to get their products to their final destination as efficiently as possible. I think that as parliamentarians we are committed to doing that, and hopefully this piece of legislation will see swift passage.
Well, that's a hypothetical question. It's as if we go back to the 1990s, when we started talking about deregulating the long-distance telephone industry in Canada, which, as everybody knows, was owned by Bell Canada.
At the outset, if we focus on the issues that are at hand, the issue basically is to make sure we develop the proper tools to ensure that the complaints, the issues you've raised, Mr. Fast, are addressed.
We feel that final offer arbitration, commercial dispute resolutions, and the review of level of services, all the tools that are there, will ensure stability within the marketplace, will ensure stability in terms of the relationship that must be developed between the shippers, the producers, and of course the railways.
We are, of course, in a situation where, yes, you're absolutely right, we have two main owners of the railways in Canada. What we have to be able to do is put forward the best tools to make sure that, optimally speaking—and I come back to what I was saying to Mr. Jean previously—we remain competitive, we remain strong, economically speaking, and we continue on the trajectory that has been launched over the last several years; and that in terms of obstacles to seamless integration—I use the expression largely, but I use it also in terms of efficiency—we are able to find a proper resolution to that. What we are doing here today, I believe, will settle many, many of these issues.
I certainly have the privilege of listening to a lot of my caucus members, because we do have a strong representation from the western part of this country, who have expressed and voiced concerns over the last number of months that we do something, that we finally act on this issue, because, as you say, in many ways it is a situation where small communities do not feel that they are part of it. It is a lifeline to these small communities, and we have to make sure that these lifelines and these railways work efficiently and that they work cooperatively with the folks who are there.
I certainly want to thank you, and I want to thank the other members from our caucus for having so strongly defended this issue.
Thank you, Mr. Minister, for appearing.
I have a couple of questions. On page three of your presentation, in the fifth paragraph, you make reference to having encouraged the railways to develop a commercial solution that would complement amendments to the shipper protection provisions. You said significant progress was made, but unfortunately they were unable to reach an agreement, and you still support a commercial approach. I'm wondering how you feel that fits in with what's provided in this bill.
Secondly, I want to make a comment. I'm glad to see the issue has been addressed with respect to the incidental charges included in this bill. I know that was a concern of the shippers. I'm wondering what issues from your discussion remain to be resolved in terms of the proposed review of the services. I'm thinking of running rights, for example, about which it was indicated that there was not agreement. I think the comment was that the main proponent of expanded running rights had dropped their support and focused on the other changes.
Is that simply a shift of priorities? The running rights.... I'm thinking of the port of Prince Rupert, which you made reference to, and the port of Vancouver. We know how important the Asia Pacific is going to be. The whole Asia Pacific initiative, which was started by our government and has been carried on by yours, has huge potential for Canada and certainly for British Columbia. And rail access is vital to the success of the gateway.
We know that by 2020 the indications are that rail container shipments through the port of Vancouver will be up 300% from the current roughly two million containers, or 20-foot equivalents, to somewhere between five million and seven million. That's huge, and we have to have a system that's able to handle that.
I wonder if you would comment on that.
Thank you, Mr. Bell, for those questions.
Actually, we had looked at a commercial dispute resolution mechanism, and I think I've mentioned it in my comments and also publicly. We have tried and we came extremely close, I must say, to resolving that issue. Both parties were amenable to that, but at the end of the day it broke down. So I had no other recourse than to go to the next step and put in final offer arbitration or group arbitration.
I'm not against that either, of course, because it wouldn't be in the piece of legislation. But it was my first belief, Mr. Bell, that through a commercial dispute mechanism we would be able to get there. However, it didn't pan out that way.
We've left it in there. We encourage it. As a matter of fact, I believe it's an effective and useful tool, because it is a tool that saves a lot of time and is efficient and is less costly.
We've gone to group final offer arbitration because group final offer arbitration enables the smaller shippers to be able to bundle together, to come together with other shippers, to be able to strike a deal. You know, final offer arbitration, once there is a deal that is struck, generally speaking, is a benchmark. So what we've done is open the tool kit, we've put that in front, and we recommend the usage of this way of going about finding a way to resolve the problems that pit the shippers against the railways.
On the running rights issue, I'll let Ms. Borges respond to that because it's highly technical. But I do want to reassure you, of course, that we are extremely committed to seeing growth, particularly in the Vancouver area out west. We want to be able to maximize the full potential of the Asia Pacific Gateway and I think that all parties in the House are open to that. That's an objective we all share commonly.
We've gone through a process where we're encouraging port mergers and finding ways to be able to maximize our potential.
You're absolutely right to talk about the phenomenal growth that is going to take place in the next several years. The potential is enormous for the Canadian economy and we want to be able to work with our partners, particularly the province of British Columbia, its premier, and the city of Vancouver and any other interested parties, in making that happen.
I'll let Ms. Borges speak to the running rights issue.
It is likewise a pleasure for me, Mr. Carrier, to be here and to find you in such good form.
As I mentioned before, when we started these multilateral discussions, there were a number of complaints, specifically from shippers who felt that they were not being dealt with appropriately and, as a result, were not being getting proper service. All through the process, they proposed operating with the final offer principle. We encouraged a commercial solution to resolve disputes. So the parties came to an understanding in principle. They sat down and tried to resolve their differences. They came very close to doing so, but in the end they could not make it work.
Today, we have a bill. The shippers' preferred tool was final offer arbitration. We agreed to that for several reasons, the first being that the commercial resolution mechanism had not worked. It was an important step, but since it did not work, we must clearly have another step, which, in one sense, seems to me to be more suitable.
In another sense, and this is one of the reasons that I am in favour of it, it allows small shippers to be able to get together with others with a view to having their differences resolved. Often small shippers have neither the financial resources nor the flexibility to do these things, particularly when they are going up against big companies.
I will add another reason that led me to move in this direction and to keep the possibility of recourse in the bill. It provides a commercial solution that is frankly cheaper and more transparent.
In this bill, we have provided the parties with tools that, in my opinion, are going to allow any disputes that arise to be fairly resolved. I do not think that there will be a constant demand for final offer arbitration. Once we have been able to establish the rules and the appropriate mechanisms, they will form the basis for the process.
Practically speaking, we are trying to put some discipline back into the industry so that we can maintain our competitiveness and assure ourselves that products and services are delivered in the most effective and efficient manner.
Thank you, Mr. Chair, and thank you, Minister, for being here.
It's interesting, because we know the discussions on this go back to 2000 or 2001. Over those periods of time—and I'm from Ontario and I don't have the western perspective—the cattle that used to come in now don't come by rail; grain that used to be transported by rail is not nearly as prevalent. Why? What I'm hearing, especially on the grain side, is it's because of the cost and reliability. Sometimes it's the reliability. They've been able to have the cars come into the grain elevators to get unloaded, make sure they're going to be there, and they don't show up. Those are the two issues.
The charges for railways seems to have gone at their discretion. Some of those charges that are being added in, those extra charges—whether they're for the cleaning, the storage, the weighing—seem to have been at the railways' discretion.
I think the final offer of arbitration is good. The only thing that I raise, and it's always something in the back of many people's minds, especially in the rural areas, when you hear of arbitrations is that it's good for small shippers, and that's important. Mainly out where I come from, that's what we have, smaller shippers.
So I'm glad to see the shippers, when I've talked to the few in the short while I've been involved in the committee, accept the concept, because it is a good concept.
I just want some clarification or surety that it doesn't become some sort of a judicial nightmare in terms of being able to go through the process and it becomes so costly and so time-consuming that it won't be productive.