Thank you, Madam Chair, for the invitation to appear before you today.
I know you had invited the former chair of the CTA review panel, the Honourable David Emerson, to appear before you, but unfortunately he was unable to attend. I'll certainly do my best to represent him and the rest of the panel members at today's meeting.
By way of background, as you probably know, the review of the Canada Transportation Act is conducted about once every decade. The Minister of Transport at the time appointed a panel of six members under the chairmanship of Mr. Emerson in 2014. The panel undertook its work from 2014 until December 2015, when we submitted our report to the Hon.
Over the course of the 18 or so months that we worked on the report, we undertook consultations with some 500 stakeholders, groups, experts, and academics. From the very start of the process, our chairman, Mr. Emerson, stressed four basic assumptions that would guide our work.
First, that Canada has been, is, and will very likely continue to be an economy greatly dependent on international trade for its national prosperity and its wealth. That Canada, by global standards, is a country with a small population spread over a huge continental land mass.
Second, that transportation is the key underpinning of not only the country's economy but also its society, its communities, and its people. It is no wonder that the foundation of Canada is very much identified with its transportation links, that the building of a transcontinental railway that allowed this massive land to be traversed efficiently and safely, is very much a part of our national identity.
Third, that Canada's competitiveness, as an economy, depends largely on transportation and logistic systems, which move goods and people efficiently, rapidly, and cost competitively. These are sometimes called global supply chains.
Fourth, that Canada is part of an integrated North American trading system. Our participation in the continental neighbourhood and our ability to coordinate our policies with our two North American neighbours will be a critical component in developing transportation policies now and well into the future.
As we looked into the various transportation challenges and opportunities that Canada faces, we examined them in the context of these assumptions and tried to answer the question of how best we could recommend changes to ensure that Canada was well prepared, and is well prepared, from a transportation perspective to participate effectively in the global economy, and to also serve this population, which is spread across the incredibly large land mass, north, south, east, and west.
As we sought the input of stakeholders, we heard a huge variety of thoughts on transportation challenges faced by industry, shippers, travellers, and communities. I'm sure, Madam Chair, that you, and the members of the committee, will agree that it seems like everyone in this country has an opinion on how best to solve the transportation challenges faced by the country.
The report that was submitted to the minister touched on every mode of transportation that falls under federal jurisdiction, including air, marine, and rail. It also dealt with some issues which, the minister at the time, specifically sought our input on governance; the north, which for our purposes was Canada north of the 60th parallel; and grain transportation.
Each adviser was assigned by the chair, Mr. Emerson, to take responsibility for a specific mode or subject. Minister Emerson asked that I focus my work on air and the north. For the air sector, the panel met with nearly 100 stakeholders, experts, and academics, who shared with us their views on the various government policies which impacted their sector. As you can imagine, when dealing with such large groups of stakeholders, each one brought their own perspective to the table, and provided us with sometimes conflicting perspectives and advice.
Through the recommendations, the panel attempted to strike a balance between competing interests with a view to ensure the strongest possible policy framework for the next 10, 20, and up to 30 years. The one issue, however, where we received near unanimity from the air stakeholders, was pre-board passenger security screening and CATSA.
Every stakeholder we met gave examples of inefficiencies and frustrations with CATSA and how CATSA was quickly becoming a bottleneck which was affecting their ability to grow, to offer new services, or to even maintain existing services without significant inconvenience to travellers and significant financial costs.
While the panel's time horizon was focused more on the long-term—a 10, 20, and 30 year time horizon—we felt that given the input we received, we had to look more intently at CATSA and provide our advice to the minister on how these issues could be resolved in the near-term.
We found that while we had a system that fulfills its core mandate of ensuring the security of air travellers, it does so at the great expense of service to customers and efficiency. Through our study, we found that while other agencies such as the Canada Border Services Agency had effectively used technology and their resources to enhance border security while significantly improving the traveller experience, CATSA had failed to do so and did not seem interested in pursuing ideas for improvement.
For the north, the panel focused its work on Canada north of 60, as I said earlier, and visited all three northern territories, meeting with stakeholders throughout its travels. The one key message we heard throughout our travels was that northern Canadians want to ensure that they remain a critical and vital part of the national transportation system and that while there had been major national efforts to link the country on an east-west basis, many of the northern stakeholders we met felt that improvements could be made to ensure that northern Canadians would also be included north-south.
We discussed and debated a number of ideas with them since several jurisdictions did, in fact, address the issue of remote communities as part of their national transportation systems. Ideas such as the essential air service program of the U.S., among others, were explored. In the end, however, based on the input we received from territorial government representatives, communities, indigenous representatives, and other stakeholders, we focused many of our recommendations on infrastructure improvements, which would address many of the concerns and issues that were raised in the north.
With that, Madam Chair, I am pleased to answer any questions you might have regarding the report.
Let me just start by saying that our initial assumption was that we wouldn't be touching too much on infrastructure, because that would have been outside the scope of transportation. However, as we delved more deeply into this and looked at what other jurisdictions have done in their management of transportation policy, infrastructure was very much a part of how they positioned themselves.
In the north, we would define infrastructure, basically, as the basic building blocks on how you move people and goods. That would involve ports, airports, roads, and rail. But, obviously, in the north rail and roads aren't as prevalent, so in the north it would be more ports and airports, but more particularly airports.
In the case of the north and airports, unlike a lot of other northern jurisdictions, we found that in Canada with our user-pay model and practice over the years, we have northern communities that still rely on gravel airstrips for access. It's their only form of access in and out of those communities. The reason we felt that infrastructure was a key component of any look at northern transportation was that for many of these communities, those gravel strips have a very finite lifeline just because the aircraft servicing them are getting very old. We're getting to a point where there are no replacement aircraft of similar size that are capable of landing on gravel strips. Without addressing the fundamental infrastructure issues that are present, particularly in the north, we didn't feel that any transportation study would be complete.
That's an excellent question, and it was one that we struggled with as a panel.
One of the elements I should note in this is that if foreign ownership increases to 49%, it doesn't necessarily mean increased foreign airline competition in Canada. It merely allows carriers, or airlines, or air services companies to access a greater pool of capital, which, unfortunately, in a country of this size isn't as large as a lot of these start-ups would like it to be.
We struggled with this, but in the current context where we've seen significant improvements in the financial performance of the Canadian air carriers, going up to 49% wouldn't be something that would create a dramatic change in the playing field. We noted that some of the carriers had at one point or another advocated increases in foreign ownership to 49%, but have subsequently changed their positions on this. In the Canada EU open skies agreement there are in fact provisions already to increase foreign ownership to 49%. So idea that increasing foreign ownership to 49% would have a direct impact on the competitive positions of income and carriers was definitely considered, but we felt that going to 49% wouldn't have a dramatic impact.
In terms of the 100% for speciality carriers, we were primarily looking at air cargo. In a country like ours, with a landmass like ours, we have not been able to generate a lot of activity in the air cargo business by Canadian carriers. We do have Canadian air cargo operators that operate primarily domestically, but from Canada to the rest of the world, based on the input we heard from shippers, a lot of those goods tend to be trucked to the United States and then shipped outside Canada through U.S. airports.
We felt that given the limited Canadian activity in that space, there should be not a huge impact by increasing it to 100%, which arguably is more radical than 49%. It would help stimulate investment activity in a sector that Canada doesn't participate in a huge way.
Obviously, air and the north are great priorities to start with. I think the report, as a starting point, whatever one's views of the recommendations are, should provide the government with a road map to the challenges that stakeholders have identified.
We tried through our work, in particular, as a result of the experience that our chair Mr. Emerson had in compiling similar reports and recommendations for government, to ensure that the consultations were not focused on industry stakeholders or participants in the industry. We wanted to expand the consultation to include academics, experts, and to make comparisons with foreign jurisdictions.
Our hope is that whether or not the government feels any affiliation to the recommendations, at least we've succeeded in providing government with a road map, a view of the challenges that the industry faces. As Ms. pointed out earlier, it's a review that takes place once every 10 years, and when we went out and consulted, we had stakeholders who came up to us and said they had a huge list for us because they hadn't really gone through a review in over a decade.
As you said, I think the minister very rightly thinks there are so many economic implications that we can't afford to get this wrong. Hopefully, this report provides him with at least a framework for the challenges that industry stakeholders have identified as ones that would be helpful for them if they were addressed going forward in the 10-, 20- or 30-year time frame that the report is designed to respond to.
I don't think this is going to come as a surprise to anyone, based on past comments and past desires, not only by me but by many members of the committee on both sides of the table. I think for the most part Mr. Dee validated earlier what the next priority should be, especially as it relates to the Canada Transportation Act review.
With that, Madam Chair, we all recognize that Canada is the second largest nation on this planet, spanning six primary time zones, three oceans, with a sparse population scattered unevenly in both rural and urban pockets throughout the country, and a geography that includes permafrost, near-tropical growing zones, mountains, prairies, open inland lakes, and pack ice. Canada's diversity, Madam Chair, is simultaneously a source of strength and of challenges, in no place more so reflected than in transportation, as was validated once again by Mr. Dee.
In this context, Madam Chair, it's my feeling that the Standing Committee on Transport, Infrastructure and Communities should conduct a comprehensive study on the creation and development of a Canada transportation strategy. This would be with a focus on strategic transportation corridors, using a gateway approach. To permit maximum flexibility, I propose we focus on a strategy, a development, into five regional gateways—and this is in random order, Madam Chair—northern Canada, western Canada, the Prairies, eastern Canada and, of course, central Canada, although this is up for discussion. All I'm trying to do here is put a focus on direction. That way, we can proceed in such a fashion.
Madam Chair, finally, within each gateway, the proposed strategy examination should include, in my opinion, four distinct areas and phases: one, seaports and aquatic-based transportation; two, air travel; three, rail; and four, of course, non-rail, ground-based transportation such as roads. Madam Chair, that strategy would be multi-modal and intermodal in scope.
I'm not going to say any more, because I think, for the most part, Mr. Dee wrapped it up quite well when I asked him about the need for such a direction.
Madam Chair, what I'm looking at doing is asking the committee and gaining consensus from the committee to undertake a comprehensive study that's designed to research a Canada transportation strategy with a focus on strategic transportation corridors, using a gateway approach, as I mentioned earlier, and that you, Madam Chair, be empowered to arrange and coordinate, in consultation with all committee members, all resources and witnesses needed for the study, and that the study launch as soon as possible after the House returns in the fall.
I think it's pretty clear what Mr. Badawey is tabling. Usually the steering group, which hasn't met since the first time, would take a look at all the proposals for topics, and then we would prioritize them. What I find troubling is that we're only looking at Mr. Badawey's proposal. We're not looking at all the ones that were tabled previously.
What I would prefer is that Mr. Badawey's proposal be in the hopper. It may well be the one people prefer to go with, but I think that as a committee, we should be deciding which of these we want to proceed with.
My second concern with this one is that it's essentially Emerson all over again. We know this two volume report. This is going to take our committee two to three years. I need to have more information on what we're planning, considering this, and how we're going to constrain this review to make it of any value. Emerson worked how many years on this? There was a whole team, with full-time, paid researchers. I remain totally puzzled about what we as a committee can do with very few resources. I don't know if we're going to use Emerson as the framework or use the same headings. Are we going to do what Emerson didn't do?
That term “hubs” is to me very much for corporate trade. If it's corporate trade routes, we want to make sure that infrastructure and transportation needs are addressed. We can probably deal with that. We talk to the main trade sectors. We talk to the main transportation parties and maybe the provinces. But that's where there's a rift.
We now have a Prime Minister who's saying that the municipalities are going to be able to tell us directly where the money is going to go. Then you have the provinces saying that they have priorities, and quite often they are these hubs.
I need more clarity in order to throw out names of witnesses. If this is going to be somewhat circumscribed and not go on for many years, I need to have a clear idea of the exact focus of what we're looking at that is above and beyond what Emerson has already done. If the main interest is looking at the corporate trade interests, it helps a bit, but that excludes a lot of other things. I just need to be clear in my head if I'm supposed to start proposing witnesses.
What exactly is our end objective? Whose needs are we serving who could potentially speak to the committee? Then we could consider that and then possibly make some recommendations.
I had some thoughts similar to yours, Linda, and obviously had a chance to ask Vance or to at least propose a few ideas.
What I take out of this proposal is a focus on the economy and economic growth. When you talk about corridors and hubs and trade, that's basically what it's all about.
We have the Emerson report that's set out a framework, or at least things we should be thinking about. At the same time, it's concurrent with the forthcoming phase two of the infrastructure rollout.
It occurs to me that with one layered on top of the other, we can have a bit of a focused look at maybe some best practices. Or it can inform some decisions either at a municipal, provincial, or federal level as to how best to apply that infrastructure program in a way that maximizes the benefits to the economy. And it's not just the economy we have today but the economy we expect to have as we develop innovation and green and all those aspects that'll reboot our economy, because the old manufacturing jobs may never come back.
There's a good opportunity here, but going to a comment you made very early on in our process, Linda, there has to be some focus. If it's too broad, we'll spin our wheels and not get anywhere.
This is where, in Vance's proposal, I saw a focus specifically on the economic benefits of an infrastructure/transportation strategy whereby, to use Vance's words, we're not wasting money; we're applying the money where we're going to generate the optimum value.
Thank you very much, Madam Chair.
I would like to discuss a few points concerning Mr. Badawey's proposal.
First of all, in light of the fact that the has already announced that he is currently working on phase two of the infrastructure investment plan, I think it would be very important to adopt a schedule for our work. We have to see to it that our work serves those who will pay according to what we will recommend. Since sums of money come from one pocket and the ideas will probably come from another, the ideas have to be ready when people are ready to spend. I think it would be important to draw up a timeline or, at least, make sure we complete the first part of this analysis as quickly as possible.
Secondly, I wonder if Mr. Badawey would agree to amend his motion slightly in order to align our work expressly with the infrastructure projects and the infrastructure plan. We should mention that all of this is being done in the context of that project, to send a clear signal to government authorities that we are doing this work quickly because we want transportation to be a priority consideration in investment projects. If that could be included in the motion, I could support it more easily.
Thirdly, Mr. Hardie, you had proposed that we approach this sector and this study in light of the country's economy. However, we must not forget that in developing the country's economy, we can help grow the wealth of Canadian citizens. We can also enhance growth on the social side. We are basing our work on the economy, but we should not forget that there are also repercussions in the regions and not only in the large centres.
It is like the question I put to Mr. Dee. We should not only focus on the big network. How can the small network and small communities be integrated into this potential national transport strategy?
To begin this study, I think it would be important to see what has been done elsewhere. It would be interesting to see how a national transportation strategy can inflect infrastructure investments. As Mr. Dee said, a national transport strategy must continually be changing. We want to avoid what Ms. Block identified: establishing a strategy every 10 years means a static strategy.
How can we ensure that we use past experience to see what was done well and what was done poorly? We should not redo the same things poorly, or redo the same things, period. As Ms. Duncan mentioned earlier, we should not redo things that have already been done. I think it is important that our first meetings on this topic allow us to clarify the direction of our study and the work of the committee.
I think Luc and I are on the same page as well as most of us around the table with respect to aligning the strategy with infrastructure investments, and therefore contributing to our overall economic performance globally.
This is not a motion. I'm just looking for consensus to start the process, but I can, for the sake of the minutes, be very clear and tie in everything that's being stated here. If you don't mind, Madam Chair, I can do that. I've been jotting something down because I do want to capture everybody's thoughts on this because I do think it's important.
Before I get to that, just going to Linda's comments, this is something that we're all going to be part of, with respect to a vision for the future when it comes to transportation. Yes, it may in fact be a process that might take some time, but for the most part we do have some time and we should be taking that time to make it right.
In the past century, we saw a railway going from coast to coast. That really set the economic performance of this country. Really, everything after that was just sort of patchwork with respect to different methods of transportation. We never took the time, regardless of how much time it would require, to really integrate those transportation methods.
That's our strength. We are a country that contributes overall to the global economy and our performance is dependent on our ability to integrate our modes of transportation, not only here in Canada but to join with the United States who are next to us, to ensure the further integration and then enhance our economic profile when it comes to our global performance.
With that preface, Madam Chair, I'm going to attempt to say this for the record and hopefully tie in everything that has been said: That the committee undertake a comprehensive study designed to research a Canada transportation strategy with a focus on strategic transportation corridors using a gateway approach, and aligning with infrastructure advancements which also contribute to economic global performance, and that the chair be empowered to arrange and coordinate, in consultation with committee members, all resources and witnesses needed for the study, and that the study launch as soon as possible after the House returns in the fall.
Yes, I didn't intend any of my motions to be secret. I presumed that they were shared with everybody the minute I submitted them.
One of them was on drones, and my understanding was that we were going to actually proceed with drones, and then suddenly we weren't proceeding with drones. I think it's something that is clearly of concern in every community and clearly a concern to the minister. I think it would be well worth proceeding with one or two meetings on that. I think it's really important to all our communities.
My other one was on the chapter on northern transport in the Emerson report, which is seen as the new economic frontier for Canada. There is great concern about the opening up of the Arctic, and I just think it was a discrete piece from Emerson that really merited review. The needs of the north have not really received any attention whatsoever, probably in the last decade, the needs of the north in infrastructure, frankly, and transport.
I still stand that those would be my preferences, frankly, to proceed with.
As we prepare to go forward, I think that Mr. Badawey's is a big one and I think it's going to take us time. Over the summer we're going to be preoccupied with barbeques and whatever. Try to dedicate your mind to who would be witnesses. I think it's going to be a challenge in some cases. Because of the decision on the rail safety review, I'm going to be much more strident in insisting that we have much better representation from across Canada than just some members getting their ridings showcased.
So if we're going to be looking at hubs, we'd better be fair. The north is not the north; the north is the Yukon, which has totally different needs from the Northwest Territories, and there are totally different transportation needs in Nunavut, and totally different needs in all the northern areas of the provinces. So there is actually a big issue that's raised, and may even come up in the Emerson report, about discriminating against the northern parts of all of our provinces, which have been calling for more attention to hubs as opposed to just in the south.
I would prefer that we have more discussions in all of this array because we can't study everything. I think it would be good over the summer for people to go away and read as much as they can, confer in their ridings or in their region, find out what the bigger issues are, and what would be some good case studies to showcase.