AAND Committee Meeting

STANDING COMMITTEE ON ABORIGINAL AFFAIRS AND NORTHERN DEVELOPMENT

COMITÉ PERMANENT DES AFFAIRES AUTOCHTONES ET DU DÉVELOPPEMENT DU GRAND NORD

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, June 11, 1998

• 0912

[Translation]

The Chairman (Mr. Guy St-Julien (Abitibi, Lib.)): Pursuant to Standing Order 108(2), we are proceeding today with a study of Aboriginal Economic Development.

We will be hearing the following witnesses: from NAV CANADA, Mr. Don Ingham, Vice-President, Corporate Planning and Commercial Relations and Acting Vice-President, Finance, and Mr. Arthur Andreassen, Director, Rates and Revenues.

You will be allowed approximately 10 minutes to make your opening statement, after which there will be a question period. At around 9:30, I will have to slip away and will be replaced for approximately 10 minutes, because I must go to the meeting of the Standing Committee on Privileges and Elections to discuss a motion that will be voted upon by Parliament at 3 p.m.

Please begin, gentlemen.

Mr. Don Ingham (Vice-President, Corporate Planning and Commercial Relations and Acting Vice-President, Finance, NAV CANADA): Thank you, Mr. Chairman. Please allow me to make my presentation in English.

[English]

We will try to be very brief.

I want to thank you very much for the opportunity to make a presentation to you specifically on the fees as they would apply to the more remote or northern regions of Canada. Other issues surrounding NAV CANADA I'm sure are of interest to the members, but at this point in time we understand the main interest is the fee schedule, and that's really the subject of our presentation.

Before I turn it over to our expert, Mr. Andreassen, I'd like to just give you some background on NAV CANADA. I'm sure you followed how the company was formed, but it's been a while, so I just want to give you some of the background.

NAV CANADA is a not-for-profit company that was born on November 1, 1996. It assumed the ownership and the operating responsibility of the country's air navigation system, or what we call the ANS. You'll hear that term, ANS, quite frequently.

The Canadian Civil Aviation Navigation Services Act—we call it the ANS Act—authorized the transfer of the ANS to NAV CANADA and established the parameters within which NAV CANADA would operate. The transfer of the ANS represented the culmination of a decade of discussions and negotiations amongst business, labour, and government to develop a new and improved method of operating the air navigation services.

Commercialization of ANS reflects a worldwide trend. Many other countries in the world are moving towards commercialization of ANS. We are just part of that worldwide trend.

• 0915

The reasons may vary from continent to continent as to why a country commercializes its air navigation services. However, in Canada, the creation of NAV CANADA was a result of the deep concern from the airlines, the pilots, and Transport Canada itself over the future development of the air traffic system in this country. All parties knew significant investments had to be made in the system, and there was a recognition by everyone that during times of government restraint, no guarantees existed that these investments could be fully made. Furthermore, the commercialization of the ANS provides opportunities for a more efficient operation while maintaining or in fact improving safety.

These parties then undertook the exhaustive work of developing a corporate model that would provide for high-quality and efficient services at a reasonable cost to users. Safety regulation, however, remains the responsibility of the Minister of Transport.

A unique non-share capital structure was decided upon. What's unique about it is there are no shareholders, and hence there is no profit motive for charging excessive fees. Any surplus revenues must, according to our bylaws, be ploughed back into the system in the form of either reducing the user fees, investing in new technology, or paying down the fairly sizeable debt we incurred in buying the business from the government.

To ensure that the company's operation and management fairly reflect all component groups of the air navigation services, our board of directors is somewhat unique, because it's made up of appointees from the commercial aviation community as well as our employees and the government. I won't go into details of the make-up of the board, but suffice it to say it is a very balanced board and a very active board. They keep management on their toes and take a great interest in the details of how we operate the system, and in fact ensure that the system is operated very safely and in the most efficient manner.

NAV CANADA is an organization committed to consultation. The approach is evident in the way we've reviewed our service levels across the country. We have some 50 or 60 aeronautical studies scheduled over the next 12-month period in order to extensively and exhaustively review all of the circumstances surrounding revision to our services in any one part of the country. I'm not aware of a commercial operation around the world—and we've talked to many of them.... In fact many of them come to us and say we are the model of consultation and openness in commercialized air navigation services around the world.

It's important to note also that NAV CANADA is dedicated to getting our own house in order. Rather than simply passing huge costs over to our users, we've taken the bull by the horns and created a three-year strategic plan we've called Shaping Our Future. I believe there are copies of that available. If there aren't, I'm sure we can get you one.

In that document we describe initiatives that will respond to our customer requirements. We are committed to reducing our controllable expenses by 17.5% over the next three years. That will amount to about $ 135 million. Out of a total expense pile of about $ 600 million, we'll take out about $ 135 million of excess expenses, at the same time maintaining—in fact we believe we can improve—the safety of the system while we are doing this.

NAV CANADA is especially sensitive to the needs of the north and the remote parts of the country. This sensitivity exists in all levels of our organization. Our president, I'm sure you know, is John Crichton. He has been in the north for some, I believe, 17 to 20 years and knows the north very well. He certainly represents a very significant and loud influence on some of the procedures and policies we put in place for our operation, particularly in the north of Canada.

NAV CANADA as well has a legislation, a very detailed legislation, that forces us to treat all our constituents fairly and openly. At the same time, we recognize that the unique circumstances of the north—its geography, characteristics, and concerns—require that we address the concerns of the north and try to be.... I wouldn't even say as fair as possible. We try to push the envelope of giving more services to the north at lower cost than we would in the other parts of the country.

• 0920

NAV CANADA serves the whole country, working with users and other shareholders to ensure safe and efficient air navigation services. The north involves an integral part of that air navigation system.

Let me take two minutes to inform you of some of the services we have north of 60 degrees. There are in fact two air traffic control towers, 11 flight services stations, 40 community air radio stations, which we call CARS, 108 navigation aids, and air traffic control from the area control centres in Edmonton, Winnipeg, and Montreal. The table attached to our presentation lists in detail the stations we have north of the 60th parallel.

The special circumstances of northern Canada are fully recognized by NAV CANADA, as they are in the air navigation act, the ANS act. The act affords special protection for designated northern and remote services, both with respect to these services and to the charges we apply to them.

NAV CANADA's mandate is to provide safe and efficient air navigation services across Canada, including the north. As a commercial operation, we cannot be a government instrument of regional development. Our business is not in regional development. However, NAV CANADA makes an important contribution to the economy of the north. For example, NAV CANADA provides some 200 jobs directly or indirectly through our CARS airports, and close to half of those jobs are performed by aboriginal people living in the north.

I'd now like to turn it over to Arthur Andreassen, who has been following this whole fees exercise for the last twenty-odd years and is undoubtedly one of the world's experts on air navigation fees.

Mr. Arthur Andreassen (Director, Rates and Revenues, NAV CANADA): Thank you, Don.

[Translation]

Good morning, Mr. Chairman.

[English]

Good morning, ladies and gentlemen.

My part of the presentation deals with the development of the charges. As you may know, NAV CANADA has two years to move into its own set of revenue sources. The air transportation tax will be no longer applicable as of November 1 this year, and that is when we need to have our own charges in place to cover the costs.

The presentation you have and what's in the paper basically discusses the charges in four sections. One deals with the fee development process. The second one deals with the legislative and policy framework we work within. The third and fourth sections specifically turn to the fees we have put in place as of March 1 this year and what is proposed for November 1 this year. This is what we call phase one and phase two of the development of these new charges.

If I may start with the fee development process, we think it is crucial to our success that we have a constructive, open, and frank consultation with our users and stakeholders, including governments and a number of chambers of commerce. We consult with a wide range of stakeholders. We believe it is essential for us to get as balanced a charging structure in place as possible by having this kind of consultation so that we know what all the issues are.

There is no question that those are so diverse that it is very unlikely that you end up in a situation where there is in fact a broad consensus with everybody that this is the ideal solution. There are generally very diverse interests, and there is a role to try to find as reasonable a balance as possible. That being the case, consultation is essential.

The legislation provides for about 60 days consultation. If you go back and look at our track record, you will find that we have had extensive consultations, both in phase one and indeed in phase two. We had a lot of discussions during the winter, without a proposal, just getting the issues on the table and trying to get a sense of where the views are before we put together a formal proposal. That formal proposal is here, and it was released on June 1. That's continued consultation for 60 days, in order to try to get it right.

• 0925

Once that consultation process is over, phase two, we then make a presentation to our board of directors and would be suggesting modifications if the comments we receive warrant that. The board then looks at it, and if they are satisfied, they then submit it to the Minister of Transport for review against the charging principles you find in the air navigation services act, which guides us.

That's the process. It's very important for us and, from what I hear, users and other stakeholders we have been discussing with. We had several meetings, as far as the north is concerned, in Whitehorse, in Iqaluit, and in Yellowknife. Those and others lead us to believe, and I think stakeholders believe, that insofar as the process is concerned we're certainly on the right track.

On the legislative framework and policy framework we work under with respect to charges, there's the ANS act, and it sets out a number of principles concerning transparency of what we do, the prohibition against any form of discrimination, compliance with international agreements. And indeed the legislators recognized the special situation in the north and there is a specific charging principle in there that deals with the charges in the north, which essentially says those fees cannot be higher than elsewhere in Canada. The legislation, of course, speaks about designated northern and remote services, so that is a specific provision in the legislation that affords a special protection for northern Canada.

We also have on the policy side very important guidance from the international civil aviation organization. Aviation is very much an international business. A very large portion of our costs, especially on the en route side—much more than half—is actually borne by foreign carriers. That's very important to keep in mind in terms of the diverse groups we're dealing with, because they clearly have different views about things from perhaps others.

Being in an international business, we feel it is really essential that we consider and respect, to the extent possible, those international guidelines that come out of the ICAO, which is an organization of states. Canada is a member, and I think about 150 countries are members of that organization. It keeps some order in the international community as far as charges are concerned.

On the phase one charges, there were two fees put in place on March 1. They apply to aircraft over eight metric tonnes. Essentially, commuter planes were not included there. So it's basically twenty seats and up, like the Dash 8, if you're familiar with those kinds of planes; these are the guys that were subject to charges, and higher, in phase one. We did that not trying to cover too much at once. We had two years to introduce it. It's a very big project, and phasing it in seemed reasonable to us. So we started with that and put it in at a partial cost-recovery rate.

In that structure and through the consultations, there are two features that are very beneficial for the northern and remote communities. One is that these fees are uniform across the country. There are much fewer facilities at smaller communities than you find out of Toronto, for example, but there's also much less traffic, so the unit cost, if you will, because of the low utilization, if the fees were structured—as in some jurisdictions they're moving to, on a site-specific basis, or the charges would vary from airport to airport—in that case, the smaller sites would end up having generally a higher fee, and it could be considerably higher than at a place like Toronto. That is if you go to site-specific charges.

• 0930

We looked at that and heard the comments. The international carriers that I talked about earlier are very much pushing for site-specific charges. We felt that, on the balance of things, it was more appropriate for us to hold onto a uniform fee across the country because it does provide some help for the smaller locations.

The other feature of those fees was not in the original proposal but is an example of where we went out with what we thought was a reasonable proposal, then we had consultations and we listened to those things that were said, concerns. So the second feature is a result of that, and that's very important and really focused on the north. The community air radio stations—it's on that table 1 that's attached to the presentation, the right-hand column says CARS, community air radio stations—about 40 of those, at those sites in the original proposal there was a suggestion that what we call the terminal fees.... There are two basic fees here: one for airports arrivals and take-offs, the services that you get, towers and so on, approach contol, and then there are the other fees, which are en route fees, which are for up in the air. For the terminal services charge we had suggested in the original proposal that all these sites here on table 1—and this table is focused on the north—would be subject to that fee. After the consultation, and what is in place today, are terminal services charges at the towers and at the FSSs essentially, and the CARS were removed from the application of those charges. That's a very important feature for the north.

Those were the two main ones. And naturally, from what I've said, some of the major users in the south—I'm thinking about international carriers here—are concerned about this kind of relief. But going back to what Don referred to earlier, there is an envelope there that you can only push so far and yet be considered as reasonable, in terms of the broad spectrum of users, and we feel that what we have here in phase one is just about there.

In terms of the net effect of that phase one initiative, our estimates indicate that for the carriers that will be subject to these charges, it would represent about 4.5%—this is an average across the network, not on a route-by-route basis, but the network—of their revenues from operations. Then you take into account the fact that the air transportation tax, of course, was reduced when we introduced our charges to about half of what it was before, and that then gives a net impact on consumers of about 3% in terms of what they have to absorb in relation to airline operating costs.

The reason there is a net increase in the north is very much tied in with the nature of that traffic. It has many aspects, but one of the more important ones, as you may know, is that a large portion of the capacity, of the payload, in the north is cargo, and there was neither an air transportation tax, nor any other fee. There was no specific contribution from those users to ANS before we put the fee in place. So it was essentially, for the domestic ANS, only passengers on aircraft above the commuter-sized aircraft who contributed.

Now when you go to a user-charge regime, you cannot have a situation where some are not paying. I think that would certainly not be consistent with normal charging policies and practices, and I think it would be questionable under our act as well. So those will be captured in these charges. That is part of the reason there is this increase of 3%.

• 0935

To then look at phase two, which is a proposal, we've had three or four months of preliminary consultations and we have a proposal. Those consultations now continue for 60 days. When we developed that, just to share with you how we worked, there's no question that one of the points that was made in the north during the phase one and during our preliminary consultation of phase two was that they felt that the effect of the NAV CANADA charges should not result in a net increase; i.e., if you take those charges and you take off your transportation tax, it shouldn't be an increase. I think that is a fair summary of the position we heard.

We were thinking hard about whether we could put together some proposal that went in that direction. And as you can see from what we have, we did not see that we could go further in the proposal than we have provided for in the application for phase one. As I said earlier in regard to the users who didn't contribute before, in a regime where the users pay all the costs, they all need to contribute. So we didn't think, as far as our thinking went, that we could accommodate that kind of a criterion in our proposal. Now it is out there for consultation and we'll be discussing this for about the next 60 days.

We are developing estimates. Of course I have the estimates for the national totals, but we'll be developing specific estimates for the north in terms of what are the charges, and we'll try to estimate the air transportation tax that is paid and see what the gap is. I should mention that in looking at that gap, it's the case that the air transportation tax, had it stayed in place, would move with volume. If traffic goes up, fares go up; it's a tax on passengers, whereas our charges are capped at cost.

As Don mentioned earlier here, we have our strategic plan: we'll rationalize services overall, costs will be coming down, so the charges will coming down. Had the tax stayed, it would likely have gone up. And if you look at the track record of the air transportation tax, it has increased by at least the ceiling, by about some 1000%, since its inception, which of course is a lot more than the CPI. So there's no guarantee of what might have happened there. What you do know in terms of Air Canada charges is that they're going to come down as we rationalize and traffic grows.

So that's one point. The other point to keep in mind is that should some of these aeronautical studies result in a switch from an FSS to a CARS, then the way this feature of our fees works, it means that those terminal charges would not be charged at this site. The terminal charge applies, as I said, only to flight services stations and towers, and not at CARS. So that would be a further reduction in costs to users in the north should it happen.

I would also mention that we heard this everywhere we went in our preliminary discussions—and it's especially true for smaller commercial carriers, but generally it's the case—that there's a feeling that with the divestiture of the air infrastructure by the government there is not a lot of need for revenues in that area. Of course, excise fuel taxes on aviation was part of the government's revenue base. Users feel that there's less of a need for that, or justification for it, because the whole infrastructure is basically being commercialized.

• 0940

We also felt that was a valid point. As part of the whole range of options we looked at, we did make representation to the Department of Finance to see if there wouldn't be a case where you could recognize some of that excise tax on aviation fuel as a contribution to ANS. Regrettably, we got a negative response to that. But that would have eased some of the overall burden.

In summary, to put a comprehensive set of user charges in place is a major undertaking. We believe we've done our best to make the transition as smooth as possible. We made it in two stages, with extensive consultations. We showed in our phase I that we're very responsive.

That doesn't mean everybody is going to be happy, but you have to try to get a balance. That is a difficult job, but if we have a good consultation process, and we know what the issues are, with the decision-making process that's put in place through the NAV Canada board, with the broad representation it has, and then reviewed back to the minister, we believe what comes out at the end of the day is likely to be as reasonable as it can be.

Thank you very much.

The Vice-Chairman (Mr. Derrek Konrad (Prince Albert, Ref.)): Thank you very much for your presentations.

This is a highly technical issue, and I wish I'd studied all of this before I came to this meeting so I'd know what to even ask. I'm glad I'm in the chair now.

I'll turn the questions and comments over to the members, and start with the member for the Bloc, Mr. Bachand.

[Translation]

Mr. Claude Bachand (Saint-Jean, BQ): Thank you for your presentation. Indeed, you have dealt with rather technical issues. We have, as a matter of fact, just returned from a tour in the far North, and it is very important to bring out the fact that there are people in the far North who are slightly worried.

You were saying that the proposed phase I charges for a B-727 flight between Ottawa and Iqaluit would amount to $ 766 each way.

Mr. Arthur Andreassen: Each way.

Mr. Claude Bachand: The return trip as well. Are the fees of $ 1,294 provided for in phase II required each way?

Mr. Arthur Andreassen: Yes.

Mr. Claude Bachand: There is therefore an increase from $ 766 to $ 1,294, is that correct?

Mr. Arthur Andreassen: That is correct.

Mr. Claude Bachand: You forgot to read us a part of your document dealing with the ANS Act. I unfortunately don't have with me a copy of the act. In the far North, we were told that there is a provision in the act stipulating that the fees charged in the far North should not go beyond their present level. Am I mistaken in that?

Mr. Arthur Andreassen: I believe that the act rather stipulates that the fees charged in the North mustn't be higher than those charged for a similar service in the South. That is more or less what the text says.

Mr. Claude Bachand: Oh.

Mr. Arthur Andreassen: I have here a copy of the act.

Mr. Claude Bachand: What clause are you alluding to?

Mr. Arthur Andreassen: It is paragraph 35(1)(g), that states:

g) charges for designated northern or remote services and for services directed to be provided under subsection 24(1) must not be higher than charges for similar services utilized to a similar extent elsewhere in Canada;

• 0945

Mr. Claude Bachand: That's exactly it. Therefore, if you increase these charges from $ 766 to $ 1,294, they are still not higher than in the South.

Mr. Arthur Andreassen: No.

Mr. Claude Bachand: Is that your theory then?

Mr. Arthur Andreassen: Indeed, Sir. The charges are the same everywhere, no matter where one travels in the country.

Mr. Claude Bachand: Very well. In Nunavut, I met with people who told me that there are no navigational aids between Yellowknife and Coppermine, which are more than 500 miles apart. Given that this question is a rather technical one and that you don't have with you the necessary documents, I won't ask you to give an answer here and now. I would nevertheless much appreciate it if you would send me the answer as soon as you have it. We are concerned by the fact that over such a great distance, in other words 500 miles, separating Yellowknife and Coppermine, on route to Cambridge Bay, there are no navigational aids.

Mr. Arthur Andreassen: I certainly don't have data on that here with me. Does your question relate to the charges or simply to the fact that there are no navigational aids?

Mr. Claude Bachand: When the federal government was in charge of the former system, it ensured complete navigational aid services. Is it possible that now that you are in charge, you are abandoning certain points on the map, up North somewhere? Is that a possibility?

Mr. Arthur Andreassen: Don might be better able to answer.

[English]

Mr. Don Ingham: One thing you have to bear in mind is that there are really two types of controllers. There's radar control and active control, where a controller can actually see the aircraft on a screen. Radar is very expensive, and basically covers the major pathways along the south of Canada.

Up north, there is radio control. In fact, the CAR stations we talked about are in radio contact with pilots. So to say that there is no air navigation service in the north is not quite correct. It is a different form of air navigation service. It is very efficient. When you talk to the pilots up there, while they'd love to have radar across the country it is not economically feasible to blanket the country with radar installations.

The Vice-Chairman (Mr. Derrek Konrad): Mr. Earle.

Mr. Gordon Earle (Halifax West, NDP): Thank you, Mr. Konrad. Good position for you there, as chair.

I want to thank you for your presentation. As Mr. Konrad has mentioned, it is a very technical subject. We're trying to struggle with this and understand it from the point of view of the people who end up either benefiting or not benefiting from the system.

I guess to follow up on Mr. Bachand's point, I understand exactly what you're saying when you say the fees are uniform throughout the country so that people in the south pay the same as people in the north, but I guess the reality is that the people in the north are still experiencing difficulty. They are more dependent on things being flown in for their very livelihood, whereas people in the south quite often do not have that particular disadvantage.

In essence, the fee structure is a source of grievance for people in the north, because their food, their nourishment, their very essentials of life depend upon this getting to them, and the increase in the fees will present a hardship to them.

I realize, as you said in your presentation, you're not there to act as a regional development agency. I guess this is probably one of the differences between a government operation and a commercialized operation in the sense that government does have a responsibility to ensure that regions of the country do not suffer as a result of policy. There is a tendency with government to give support in areas that require it, and in other areas that don't require it, maybe give less support, whereas a commercial operation does not.

This is more of a comment, but I would like some response from you. Even though yours is a commercial operation, is there not some way in which you can accommodate for the fact that there is a very real hardship being caused by these increased user fees for people in the north?

Mr. Don Ingham: Mr. Earle, there are two responses to that.

• 0950

First, coming from the private sector, I'm not sure I would agree that under government management in fact you had this redistribution of services from the south up to the north. In fact, when we took over the business, I think it's fair to say that there was a lot of overbuilt structure in the south, probably more so than that in the north.

Second, we are very sympathetic to the fact that all of the services and goods have to be airlifted into the north. I would say we bent the rules as far as we could by not charging for CARS stations under the very soft pretence that they weren't NAV CANADA staff. They were in fact staffed by local experts that we subcontract to.

This seems to have been accepted by the large carriers who in effect have to pay that subsidy, but the bottom line is that, under the legislation, we are limited as to how much cross-subsidy we can provide. We stretch it to the point where we feel we can't do any more than that with this CARS service.

The bottom line is that we believe we're here to run a fair and efficient air navigation system, and it remains the responsibility of the government to operate a regional development service.

Mr. Gordon Earle: Yes, I guess you're probably quite right that in terms of government operation before maybe the south did have more infrastructure than the north, but I guess I'm looking specifically at this program that Canada Post operates in terms of the food subsidy for people in the north. They're now telling us that with the usual fees, that program is going to end up with an increased cost, which at the moment it looks like will have to be absorbed, I suppose, by the people in the north themselves.

I guess you're saying that essentially it would still be the responsibility of the government to pay that increased cost rather than altering the structure of your business to accommodate that.

Mr. Don Ingham: Yes. I think that the misconception is that the air transportation tax system was a fair system.

One of the problems, in talking to the 700 private pilots around this country who we talked to so far, you have to point out to them that in fact the air transportation tax system that funded the air navigation system in the past was a form of subsidy. The traveller on the large commercial aircraft not only subsidized the overflights of the aircraft from other countries—it simply overflew Canada and landed somewhere else—but it also subsidized the cargo service and the service for the smaller aircraft.

So in terms of what's fair, one of our challenges is to level that playing field to move off of basically an unfair air transportation tax so as to have a fair system for all.

Mr. Gordon Earle: Thank you.

The Vice-Chairman (Mr. Derrek Konrad): Thank you, Mr. Earle.

Just before we move on, can I ask a question for all of us? I have just one quick one.

Mr. Bernard Patry (Pierrefonds—Dollard, Lib.): You're the chair. I'll give you authorization.

The Vice-Chairman (Mr. Derrek Konrad): Thanks, but the chair shouldn't ordinarily be asking questions.

I thank you, Mr. Earle, for saying that I should be chair. That means you are agreed that the Reform Party should form the government.

Mr. Gordon Earle: Well, the chair doesn't necessarily have to be government. I don't agree with that principle either.

The Vice-Chairman (Mr. Derrek Konrad): As for the fuel excise tax, you said that it is not contributing to the ANS costs. You see that as a regrettable decision. Who opposed it, I wonder, and why? That might be for all of us to hear.

Mr. Arthur Andreassen: Well, of course, excise taxes are a matter for the Minister of Finance, whom we approached. So that's where the response came from.

To what extent that had broader cabinet or ministerial discussions before we got the reply, I wouldn't know. I can't speculate about that.

I do know that we made our representation and we have to move on. We have until November 1 to have fees in place, but as far as I know, the air carriers and the regional aviation councils in the country are pursuing that issue.

• 0955

[Translation]

The Chairman: Mr. Patry.

[English]

Mr. Bernard Patry: I have at first a little question to ask you before I make some comments. You mentioned that there will be no charge of fees for starting CARS in the north. That was one thing you mentioned. What would it have been? What are the fees? Let's see, Iqaluit has some fees because it's FSS, but there are none for CARS. What are the savings for say Cape Dorset, if there will be fees?

Mr. Arthur Andreassen: I haven't done those calculations—

Mr. Bernard Patry: Are we talking about $ 100, $ 1,000, or $ 10,000?

Mr. Arthur Andreassen: For the north, as a whole, I think that extension.... I want to caveat that we're going to still look at those numbers. We don't have them up yet, but I think you're talking about maybe $ 1 million or $ 2 million in total here as a result of that provision.

Mr. Bernard Patry: Okay. First of all, this is a comment in the same sense that Mr. Bachand and Mr. Earle just mentioned in the beginning. When Mr. Ingham started his presentation, he spoke of the role of NAV CANADA. I was a little bit surprised, not to say shocked, at the fact that the role is not to be part of regional development.

You talked many, many times about fairness regarding the fees for everyone. For me, it all depends on what you feel about fairness. You want to get fees for all across the country, but the north is very important for first nations and the Inuit living there.

The economic perspective is also very difficult there. If we're not helping these people.... I don't think NAV CANADA is doing their job. That's my feeling about this. Fairness for me is different. You're talking just from an economic point of view and you're talking for the south. The south will get a decrease or it will come out as a balance when you look at what it was previously and compare it with what it is now. Up north, there'll be a net increase. For me, this is not fairness when you're going to see a litre of milk going from $ 3 to $ 3.60 in a year from now. I don't think it's fairness.

Are you ready at NAV CANADA to propose some changes to the minister for the legislation?

Mr. Arthur Andreassen: Here are just a couple of points, Dr. Patry. We are not set up to be in the regional development business. We don't have any plans right now to put in front of the minister any changes to the legislation. As far as when we talked to our customers, they believe that the approach that has been taken as far as being fair to all is a reasonable one.

As for the problem with the cost to the north, we are very sympathetic to it. However, we must point out that as for a lot of the press and public knowledge about the increases on the so-called four litres of milk or in the cost of bread, that's not going up from $ 3 to $ 3.60. We must correct that. It's going up by what we estimate to be 4%, which would be about from $ 3 to $ 3.12.

In fact, the price of air travel and air cargo services in the north is governed by the free market and what the airlines serving the north want to charge. In doing our research, we have found that the fares have escalated very substantially even when NAV CANADA in fact did not impose any fees. So I would suggest that a lot of the issue is in fact the pricing structure of carriers and not NAV CANADA's fees per se.

Mr. Bernard Patry: You mentioned also that you've been in Iqaluit. You had many discussions with the stakeholders there, the people living there. Did you find anybody who was in favour of your proposition right now in terms of what you're proposing to the north? Was anyone in the north in favour of that?

Mr. Arthur Andreassen: As I said earlier, I think the basic view of the north is that there should be no net increase. That being the case, then it's also fair to assume that they would not support the proposal we put on the table.

As we said earlier, when we develop these proposals, we need to be mindful that there are a number of users at play here, and we try to find as good a balance as we can. We did not find a way to find a structure that would accommodate that kind of criterion that there be no net increase. That is because there is this large segment of users in the north, much more so than in the south, who did not contribute before. I think if you have a charging structure in place, it would be unreasonable to charge some and not others.

• 1000

Could I make a comment, if I may, on the earlier question on the comparison between north and south?

Mr. Bernard Patry: Sure. Go ahead.

Mr. Arthur Andreassen: The observation I wanted to make is that when it comes to the same kind of user—cargo, general aviation, but we were now talking about cargo—it's exactly the same in the south as in the north. These cargo operators in the south are going to have exactly the same charges as the cargo operators in the north. Why there is a net increase in the north is that the percentage of those operations are so much higher than in the south. You shouldn't have the impression that nobody in the south is getting an increase. That's not the case.

Mr. Bernard Patry: A last question, Mr. Chair?

The Chairman: Yes.

Mr. Bernard Patry: I understand your point of view in your last remarks, but the fact is also that when there is a cargo, the airplane leaving Ottawa to go to Iqaluit is full, and when it's coming back it's empty; but for somebody who has cargo going from Montreal to Toronto, or Toronto to Vancouver, it's full on both sides. It's the same type of business as the trucking business. It's not full all the time.

The only other question is a question of whether there will be no more taxes. Let's say for a traveller like myself, who goes from Montreal to Toronto, a year from now will there be an increase for my air fare, with this new proposal you're doing, because there will be no more taxes on the ticket itself, but rather on the airplanes and the users. Is there going to be an increase for travellers like myself who go from Montreal to Toronto, or will it be the reverse?

Mr. Don Ingham: On that point, if you notice on your air ticket down on the bottom left-hand corner, that tax has gone down, from roughly $ 55 maximum down to zero. So yes, there has been an immediate benefit to the travelling public from our operation.

However, what's going to happen is that, yes, the carriers are going to have to absorb our costs as part of their cost base. How they'll translate that into a ticket price is not for us to say, but as far as a cost allocation we've been very open to everyone. In the presentation we've given you examples of how the cost would affect a typical aircraft on a typical route in Canada.

Mr. Bernard Patry: There could be a conclusion at that time that the north is subsidizing the south, because the ticket prices will decrease in the south and increase in the north.

Mr. Arthur Andreassen: Let me give you some information or a comment on that. If I go back to part of my discussion in the presentation I gave, those uniform fees.... First of all, the air transportation tax at the very best—and I think a reasonable person would agree—had very little to do with the cost of the service. It simply is an excise tax. So that is not really a yardstick as to who's supporting who.

With the structure we have put in place—and this is not a unique structure around the world, it's within international guidelines, and a lot of states actually operate this way—we have a uniform fee because of the low air traffic utilization at smaller communities, and the net effect of that is that the larger centres do provide some support to the smaller centres.

Mr. Bernard Patry: Thank you.

[Translation]

Thank you, Mr. Chairman.

The Chairman: I believe that all members would agree with giving the floor to Nancy, because we travelled in her region.

[English]

Mrs. Nancy Karetak-Lindell (Nunavut, Lib.): One thing I know you know is that this is our only choice of transport. I'm using the word “choice” loosely, because we really have no choice.

• 1005

I'm trying to see how we can get that incorporated into the fee changes that are happening in the north. When we travelled, even with this committee, we saw how the proposed changes affect so many more areas than they do people in the south. This affects our medical appointments because of passengers having to go to other areas just to be seen by doctors, and it affects fish being transported from Pangnirtung to the market, because we don't have roads.

The people down south have choices of which carriers to use. In a lot of our communities there is only one airline serving, so we don't have that option of shopping around, as people do down south. So to say as a blanket statement that people in the south are subsidizing the north bothers me, because there are so many factors that have to be taken into account. You say they are going to increase by 3% only, but that has such serious implications on every other factor of life there, whether it's the type of food you eat, or how you get medical services and so on. Can't the uniqueness of the dependency of our people on air navigation or air traffic be taken into account?

The other question I want to ask is that in one of the presentations in Iqaluit, I believe it was, it was said that a lot of the international flights flying over the north use the services of the airports, especially Iqaluit, to get weather information and whatever. We don't get as much traffic as down south—that probably isn't a big dent—but has it been taken into consideration that there are services being used of airports in the north as far as getting information for weather and whatever for international flights? Could those fees be used to offset whatever fees are going to be imposed in the north?

Mr. Don Ingham: I'll let Arthur answer the second question. On the first question, I have to repeat that our mandate from the government in running this business was not to run a regional economic development business. If the government changes the legislation and asks us to do it, I'm sure we would do it with the same fairness that we're applying to this system. However, as a taxpayer, I'm not sure I want a private enterprise running regional economic development. I think the government system is the better way to operate it.

As far as the lack of choice up north, we're very sympathetic to it, and we've taken a very liberal interpretation of our legislation in not charging for CARS. To that extent, we think we've been as fair as we can within the confines of the legislation in operating a fair system. Without changing the legislation, we don't believe we have a mandate to charge what a customer wants to pay, as opposed to what's fair for all.

Arthur.

Mr. Arthur Andreassen: On the question about the international overflights, they most definitely use services in the north, and they pay exactly the same as everybody else. I mentioned earlier that we had these two fees—the fees for approach and take-off. There's very little international activity there in the north, as you know. However, for the other fee, which is the en route fee, any flight up there pays on the same basis as anybody else, whether they overfly or they land.

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The services that go into that fee are all the FSSs, the navigation aids, the air control centres—the en route portion of that. That's one system-wide fee you pay, depending on how many kilometres you fly and the size of the aircraft. Does that help?

The Chairman: Mr. Konrad.

Mr. Derrek Konrad (Prince Albert, Ref.): Thank you, Mr. Chairman.

I notice in here there's an exemption for charitable flights. Does that also include flights of mercy, kind of medical evacuation things?

Mr. Arthur Andreassen: No. If I may make a comment on exemptions, I mentioned earlier that in a charging regime such as we have where everybody pays, we are very careful about that, because somebody else will pay if you have preferential rates or exemptions. So what you have in there are the statutory ones for the search and rescue and DND. Then the only other one is the registered charitable organizations. That's as far as we felt we could go, and as far as the users wanted us to go, as a consensus.

Mr. Derrek Konrad: Thank you. Just one quick follow-up on my previous question about excise taxes. You said the Minister of Finance opposed this, and I wonder if you have any idea why. Where does the excise tax go? How much is it? How much do you want? And how much would it benefit northerners, as opposed to the rest of Canada?

Mr. Arthur Andreassen: I don't have dollar amounts. I can tell you what the tax is on aviation gasoline for piston engine aircraft. That tax is 11¢ per litre. For turbine fuel, which is used by jet aircraft, turbo-prop aircraft and helicopters, the tax is 4¢ per litre. The total revenue for the government from the tax on the aviation gasoline, based on the information I have seen, is $ 12 million plus or minus. For the total, when you include the turbo fuel—this is where you have all the carrier traffic, very significant—a range is used, and I think it is somewhere between $ 80 million and $ 100 million, maybe over $ 100 million. That's about as much as I have.

[Translation]

The Chairman: Before giving the floor to Mr. Bachand, I would like to ask a question. You said earlier to Nancy that you weren't there to do regional development. Before the creation of NAV CANADA, there was a special 10% tax on airplane tickets.

Mr. Arthur Andreassen: It was a lump sump payment that varied between $ 6 and $ 55. That is the tax that was charged before the reduction that came into effect this year.

The Chairman: That 10% tax that the federal government charged on a plane ticket from Montreal to Grande Rivière and to James Bay was used for regional development purposes. The federal government used that money to carry out development activities in the regions.

Mr. Arthur Andreassen: Allow me to make a comment. That air transport tax, that had been put in place in the middle of the 1970s, was first of all used by the airports and, more recently, by the air navigation services or ANS. It was a rather special tax because taxes are usually paid into the Consolidated Revenue Fund.

• 1015

This tax was aimed at transport and had been used to finance ANS since the 1990s, if I remember correctly. I do not believe that one could say that this tax was used for regional development, but rather for the operation of ANS.

The Chairman: The question Nancy asked regarding development is important. We should ask the government what the history of this tax is. I remember that the government built an FSS control tower at Grande Rivière a few years ago thanks to a special fund financed by the famous 10% tax on airplane tickets. The government built an observation tower in cooperation with the James Bay Corporation when it built the new airport and your employees are working there today. This is why I am telling you that the 7 or 10% was targeted at regional development anywhere in Canada, even in the North. The purpose of this tax was to carry out projects. Would you agree on that?

Mr. Arthur Andreassen: For my part, I believe that this tax was used to finance air navigation services, wherever.

The Chairman: Projects as well, for example the construction of control towers.

Mr. Arthur Andreassen: As long as the control towers are part of the system.

The Chairman: That is what I meant. This year, in October, you are going to be taking over the famous 6 or 4% tax.

Mr. Arthur Andreassen: During our first two years, we received from the government a contribution equivalent to the revenue from the air transport tax for that purpose.

The Chairman: Yes, for regional development.

Mr. Arthur Andreassen: On that, I don't agree.

The Chairman: Fine. I will end the discussion on that.

[English]

Mr. Don Ingham: Mr. St-Julien, I don't want to leave the wrong impression with you that we are out to cut services all around. Where we can justify the need we will be building new services, particularly in the north. All of our customers are saying that's one area that needs enhancement of services, as opposed to reduction of services.

The other point we want to make as well is that while we bent the rules and said we weren't going to charge for the CARS service, it is equally effective and the customers like the CARS services as much as, if not more than, a full tower flight service station. So we must avoid getting into this trap that the more dollars you put into it, the better the service is. Having more CARS up north could enhance the service and the safety for our customers.

[Translation]

The Chairman: Thank you. Mr. Bachand.

Mr. Claude Bachand: In rereading the text of the presentation you made earlier and, in particular, the introduction on NAV CANADA, I found some lovely things, but I am not sure that they are part of reality. Let me tell you what these lovely things are: a non-profit company that has "no profit motive"; "any surplus revenues must be put back into the system to reduce our user fees, to invest in technology and facilities or to pay down our debt".

I have three questions relating to these excerpts. When you say that the surplus revenues will be used to pay down the debt and to improve technology and that you will make investments in facilities, I for one would be very interested in taking a close look at your financial statements and budget estimates.

The Chairman: To what page are you alluding to?

Mr. Claude Bachand: It is on top of page 2. I imagine that as a company you must produce financial statements. I would like to know if NAV CANADA's financial statements for the year ended indicate that there is a surplus or excess revenue that could be used for the purposes we have just spoken of or if NAV CANADA has incurred losses.

• 1020

You talk about the company's debt. Where does this debt come from and what does it amount to?

I am comfortable in asking my third question because the president of NAV CANADA is not here. You say that you are a non-profit company, but I heard say that NAV CANADA's president's annual salary was somewhere between $ 500,000 and $ 1 million. Non- profit corporation presidents in my riding certainly don't earn that kind of money. There is a problem there. I really wonder if NAV CANADA's overall management is really geared to the purposes put forward in the text. This is why I would like to know the details of the financial statements, the estimates, the present debt and the salary of the president and perhaps of the vice-president as well.

[English]

Mr. Don Ingham: Mr. Bachand, let me just address those one at a time.

By all means we'll give you financial statements. In fact we publish an annual report and we have the latest one. Our fiscal year ends at the end of August, so we're close to the end of it.

You're quite observant and quite right, we have made a profit. And I can confess here that making a profit for a non-profit organization is one of the toughest issues we've had to deal with. I'm pre-empting a board meeting that will happen next week in Newfoundland, but this year we will make a recommendation to our board to distribute some of our surplus, or profit if you like, to the users in the form of lowering those fees. So the fees you see here may change when we finish our consultation process. They will either be lower or extended out in time.

So we are dealing with the surplus. Not wanting to find an excuse, one of the reasons we had a surplus for the first two years—we won't be distributing all of it—is because in transiting from a government organization to a fully commercialized one and collecting all of our fees, you can imagine we had to estimate our volumes of traffic, etc. In order to avoid a deficit and having to come back to government with cap in hand, we purposely aimed on the conservative side. But I can assure you that in the coming years, when we are fully commercialized, those surpluses will be redistributed to the users in the form of either a lower fee or a prevention of an increase in fee.

We have $ 3 billion in debt, of which $ 1.5 billion was used to purchase the business from the government. In other words, we paid the government $ 1.5 billion for the business. The other $ 1.5 billion was to provide for start-up costs in operation during that transition period. So far, we've only used about $ 400 million of it for that start-up period, so in effect we have over $ 1 billion of undrawn lines of credit.

However, we are a very efficient organization. We have an AA credit rating, according to credit-rating agencies, and our bonds are trading at a very low interest rate. So from that point of view, it's been a very efficient economic transition.

In terms of the salary, I can't speak for my boss, John Crichton, but I suspect if he were getting between $ 500,000 and $ 1 million, he'd be smiling more than he is now. While I can't speak to it, I would be very surprised if it were at that level.

[Translation]

Mr. Claude Bachand: Do you earn a salary? How much is it?

[English]

Mr. Don Ingham: Yes, I do, at a competitive rate.

[Translation]

Mr. Claude Bachand: And what does that amount to?

[English]

Mr. Don Ingham: It's $ 150,000.

I was just reminded that his salary and mine are published in the annual report that will be coming out probably in mid-October when we close our books.

[Translation]

Mr. Claude Bachand: Is your financial advisor whispering things into your ear?

[English]

Mr. Don Ingham: No, he's actually my reminder of all the things I have to think about.

[Translation]

Mr. Claude Bachand: He might perhaps remember what the president's salary is?

[English]

Mr. Don Ingham: We have it in the annual report of last year. Did we bring last year's annual report? We could certainly make sure you get one so you can see it.

[Translation]

Mr. Claude Bachand: Please.

[English]

Mr. Don Ingham: Bear in mind I believe it was the former president's salary in that annual report.

• 1025

[Translation]

Mr. Claude Bachand: Thank you.

The Chairman: Mr. Ingham, do the president and the other people in charge of NAV CANADA receive a pension from other departments, or do they only get their salary from NAV CANADA?

[English]

Mr. Don Ingham: It's their only salary. To be very honest with you, I retired from Air Canada and have a pension from Air Canada. But for the employees of NAV CANADA, those are their only jobs, and they only get paid by NAV CANADA.

[Translation]

The Chairman: As is the case of certain MPs in Ottawa.

What percentage would your organization's bad debts account for?

[English]

Mr. Don Ingham: The bad debts? So far, we ourselves have been collecting fees since November. Prior to that, we had the Civil Aviation Authority in England collecting our over-flight fees for us. We haven't had to write off any bad debts yet. We fully expect, being realistic, that we'll have to.

Our bankers, as you can imagine, have asked for protection against bad debts, so we've put aside a reserve fund—you'll see that in our annual report—to cover any anticipated bad debts. Suffice it to say that so far we've not had to do any bad debt write-offs. It's gone much better than planned.

[Translation]

The Chairman: You have a good administration?

[English]

Mr. Dan Ingham: We like to think so.

[Translation]

The Chairman: Mr. Earle.

Mr. Gordon Earle: Thank you, Mr. Chairman.

[English]

I want to return to the concept of fairness, because you mentioned that quite a few times in your presentation and you used the argument that charging all customers in the same way is fairness.

Having been involved with fairness issues for years myself, I'm not convinced that fairness means that everybody gets treated the same way. To simplify an example, let's say you have two people who you're going to put in a race, and one is a well-trained Olympian runner and the other is someone who has never trained a day in his life. To put them both at the same starting point and say that's fairness.... To me, that is obviously not correct. The person who hasn't trained may need a head start.

When I look at the situation in the north, I think that people in the north are at a disadvantage compared to people in the south. And to me, charging everybody the same is not fairness.

I note this in the booklet that you passed out here:

The ANS Act further provides that the charging methodology may recognize that the value of the services differs among users.

So there is provision there, and I would contend that there may be some provision to allow that, because the service is more vital to people in the north. There's some flexibility to allow for a different methodology of charging.

Another statement reads:

a category of users may be charged on a flat-fee basis so long as the charge is otherwise consistent with the charging principles set out above.

And there are a number of principles that are set out.

So do not those two provisions under the ANS Act allow for some flexibility in terms of charging people differently and still having a fair system?

Mr. Don Ingham: I'll let Arthur answer as well, but let me just say that we believe we've stretched it to the maximum in our loose interpretation of a CARS airport and the fact that it is not attracting any charges at all. And if you look at your attachment, you will see the number of CARS airports in the north. They're far more numerous than either the two towers or the eleven flight service stations.

So for an infrastructure in the north, I would say that roughly 60% or 65% of the facilities in the north are not being paid for by any user fees. So from that point of view, we believe we've taken a very generous and liberal interpretation of those two passages that you quoted.

Arthur?

Mr. Arthur Andreassen: On your specifics about the value of service provision there, if you go on you will see that it talks specifically about the use of aircraft weight as a measure of value of service. It's a little bit technical here, but if you have a Challenger aircraft or a 747 flying through using air navigation services, from a cost perspective there really isn't that much of a difference. They get basically the same service. But internationally and through ICAO, it is recognized that it is not quite equitable that a Dash-8, shall we say, should should pay the same as a 747. The services provided to a larger aircraft are more valuable because of the investment in that aircraft and what it carries compared to a Dash-8.

• 1030

So what that value of service in the legislation allows us to do, and which we have done to an extent some major carriers are not very happy about, is to reflect in our fee structure quite a bit of aircraft weight. Again, we're basically pushing the envelope. If you look at that specific provision in the legislation, it will tell you that you cannot use “weight proportional” or more than proportional. If you did that you'd just transfer more cost to the bigger aircraft, which there ought to be a limit to. It's in the legislation and it is in ICAO. Basically, we have almost gone to the limit there in using that provision in the act.

The flat fee provision there is also one that you'll see in the current proposal. It is used in this proposal, and that will have some impact on the north. We will be looking at which way it goes. For small aircraft there's an annual fee. At less than three metric tonnes it's just an annual fee ranging from $ 60 for the smallest to $ 300 for a multi-engine two- to three-tonne aircraft.

Then there are some daily fees for all propeller aircraft, so that's a use of the flat fee. I think it was probably there to recognize that when you're looking at small aircraft what you have to watch for is that you don't end up in a situation where collecting the fees really costs you more than the revenues you generate. When you have small fees and try to track every movement and have a fee per movement, you soon roll up the administrative dollars.

So we are using both of those provisions in what we're proposing for our structures.

Mr. Gordon Earle: Thank you.

[Translation]

The Chairman: Thank you, Mr. Earle. Mr. Wilfert.

[English]

Mr. Bryon Wilfert (Oak Ridges, Lib.): Thank you, Mr. Chairman.

While I'm waiting for this resolution to be photocopied, I notice in your handout that you indicate that among the governing principles of NAV CANADA is a special commitment to providing the people, institutions and companies doing business in Canada's north and remote areas with high-quality air navigation service.

You also mention that the organization is fully committed to consultation and consensus building. You indicate that's evident both in the way you're reviewing the service levels across the country and the manner in which you're developing your fee structure.

You also go on to indicate that NAV CANADA is especially sensitive to the needs of the northern and remote parts of the country.

And finally, you indicate that NAV CANADA's mandate is to provide safe and efficient air navigation services across Canada, including the north.

By way of background, while I wait for this resolution, at their national convention in Regina on Monday, the Federation of Canadian Municipalities dealt with the concerns with regard to safety in the north and some issues involving NAV CANADA.

A body within the Federation of Canadian Municipalities is called “the northern forum”. A resolution came forth supported by the Northwest Territories Association of Municipalities and the Association of Yukon Communities, supported by representatives from northern British Columbia, northern Alberta, Saskatchewan, Manitoba, Ontario and Quebec, indicating that they were concerned about a policy that NAV CANADA is going to be implementing later this summer or in the early fall, I guess, in terms of airports and in terms of reductions, as they see it, in terms of safety concerns in the north.

The resolution was brought as an emergency resolution to the floor of the convention. There were about 2,000 delegates, and I will point out to you that particularly the associations from the NWT and from the Yukon were very concerned about what they saw as a lack of consultation, and the concern that NAV CAN was going forth in the face of what they view as fairly hard evidence that reduction in the service from NAV CANADA would impede safety, particularly in smaller and remote airports in the north.

• 1035

As soon as they come back from photocopying the resolution, Mr. Chairman, I would like to read you what that resolution says. I will then ask the members of the committee to consider further action on that, after I hear your response. I'm hoping, gentlemen, when he comes back I'll be able to hand that to you to take a look at it.

I think it's important to note that these are mayors from across the north who feel this will have negative impacts on their communities, and because of the impact they want a cessation of all changes at this point. You have the resolution in front of you. I apologize again. The resolution that was faxed to me is in English, but the translator has it and we'll also read it in French.

WHEREAS NAV CANADA has proposed to decrease flight service stations at certain airports within areas in Canada, and

WHEREAS any reduction in services to airports will adversely affect safety for the travelling public, and

WHEREAS Canadian weather conditions are at best uncertain at most times and subject to sudden changing conditions, and

WHEREAS airports are the lifeline to northern isolated and rural communities for the availability of emergency medical air evacuation services, and

WHEREAS the Department of Transportation is responsible for the safety of the travelling public utilizing airports

THEREFORE BE IT RESOLVED that the Federation of Canadian Municipalities lobby Transport Canada to immediately halt all plans by NAV CANADA to reduce or eliminate services which impact on safety.

That was the resolution that was adopted unanimously by the convention. As the former president of that federation, I felt it was apropos, since you're here today, to ask you for any preliminary comments. Obviously, I intend to go further with it, but I would like any preliminary comments from you.

Mr. Don Ingham: We have talked to 700 pilots across this country, and these are the people, if there were a safety problem, who'd be the first to know. They're the ones who are going to get killed if there's a safety problem. I think it's safe to say that to a person, to a man or to a woman in that pilot community, they are saying the air navigation system in Canada is very safe. In fact, particularly in the south, they are saying in many areas they'd like to have less air traffic control, thank you very much, because they tend to get in the way.

You have to bear in mind that when pilots—and I'm amazed when I see the industry—have no air traffic control, they have a protocol just like a sea-going ship, etc. Where there is no active control they have a protocol of how to stay out of each other's way. So to say when you don't have any air navigation service there's true chaos in the air doesn't quite give the right impression.

We also find it amazing that when we talk to the users, the pilots themselves, and ask if it is any less safe not to have a flight service station, particularly in the south, they say no. When we go to do the aeronautical studies that were under way about changing those service levels, the municipality says they would like very much to keep their FSS. In fact they say, “If you wouldn't mind building a tower for us, that would be even better, because there is this mistaken impression that bigger, higher, and more elaborate facilities increase the safety as you go.

So we are in this dichotomy and are trying to manage it. But suffice it to say that in the north in particular, the pilots are very concerned about the safety aspects. As we undertake the studies in the north, I'm convinced you will see more facilities, not less, being put up in the north and a growth of the so-called CARS airports, which are very effective and very efficient.

• 1040

There is a feeling among the pilots that while the south may be overbuilt and a bit less control may be better, in the north there is that feeling, as you've stated here, there should be more support and more facilities. There is a great concern that if an aircraft goes down they'd like the comfort of someone having followed them and knowing where the aircraft has gone down for a rescue effort.

Mr. Bryon Wilfert: The municipal governments represent the grassroots of the country, and these mayors of communities from Yellowknife to Inuvik to Iqaluit to Cambridge Bay to Whitehorse are obviously hearing from the populations in their communities. They're concerned that NAV CANADA will embark on reductions as early as late summer. What type of consultation has gone on, and how do you account for this resolution?

Mr. Don Ingham: On the first question, the consultation is as extensive as I've ever seen. We hold hearings on site. Very similar to the CRTC process, we advertise that we will be in town, give the location and say anyone is free to present their briefs—and they do. In this process we have the initial briefing period and a consultation afterwards, where we inform everyone of the issues that have surfaced and what some of the considerations are. Finally, when we come out with a resolution, we advertise and make known to those who presented briefs exactly what those findings are.

On your second question of why the grassroots of a community would have a different view from the pilots, I'm not sure, but all I can say is I would think a pilot who is actually involved in a so-called safety situation would be the first to raise a red flag if there were a safety problem. We talked to them, and I have not heard a groundswell.

Bear in mind that in the north there is the feeling that a bit more facilities, a bit more coverage would do. They need the security in the remote areas of having flight following—of knowing as a pilot that someone on the ground knows where you are and is talking to you. Yes, they want that.

So I think there is a great deal of support for enhanced facilities in the north. As far as the south goes, I'm not sure that conclusion applies.

Mr. Bryon Wilfert: This resolution primarily deals with the impact, particularly in northern communities. I know, because I was there and I heard the discussion, that when you consult groups, one particular group is composed of the leaders of local communities, who you may not specifically have sought out. But they heard from pilots specifically, from people in the medical profession, and from people in the transportation business.

One of the areas that was mentioned in the resolution was concern about emergency medical air evacuation services. They mention very clearly that there are plans by NAV CANADA to reduce or eliminate services. Regardless of what the consultation was, they have not been able to allay any concerns or fears with regard to safety. Maybe you could briefly tell us what the specific plans by NAV CANADA are, in terms of the reduction or elimination of services in this regard, particularly as they affect northern and remote communities.

Mr. Don Ingham: As I said, we don't have any plans. The only plan we have is to hold consultative and aeronautical studies wherever we are changing—and by changing we don't necessarily mean reducing, as in many cases it's increasing—the level of service at an airport or a city.

As far as “plans” and some mysterious underground motion to reduce a service and eliminate it, there are none. We have a genuine consultative process with a blank sheet of paper in front of us. We say “Here's the issue. The number of flights into this community does not change. It is at this level. Can it justify the service level we are giving it? Should it go up? Should it go down?”

• 1045

Mr. Bryon Wilfert: I would just mention that given the fact that there were representatives from Transport Canada at the meeting, and obviously they heard this from representatives there, I'm a bit lost as to why.... Mayors normally are not in the business of coming up with resolutions that say “Halt all plans by NAV CAN to reduce or eliminate”—unless they were presented with clear evidence that said that's in fact what they were going to do.

I notice that this gentleman here is going to probably try to elucidate on this point.

Mr. Arthur Andreassen: No, I just wanted to add a little bit to what Don was saying in terms of the process, which is all it is. As I understand the legislation, when you're dealing with designated northern and remote services—I think that's what you're probably largely are speaking about here—

Mr. Bryon Wilfert: Yes.

Mr. Arthur Andreassen: —there is a process set out in the legislation about notice any time there's a question of reduced service. There is an obligation there, and I'm sure our company goes a lot further than that in all the studies that we're doing. There is a legislative requirement, too, to provide notice, and there's a period of time where users are looking at it. I notice that it says in here that the corporation shall send by mail a copy of the notice to the government of every provice affected by the termination or reduction, and then it goes on to talk about rejection of proposals.

Mr. Bryon Wilfert: That's one of the problems right there—that it goes to the governments of the provinces. Some of the provinces are not as good at communicating as they should be when it comes to these local issues.

Without going on, Mr. Chairman, I guess I will ask you at the appropriate moment for some guidance as to how I may proceed in terms of putting on the floor a resolution to further examine this particular point.

The Chairman: We'll have a look at this at the end.

Mr. Bryon Wilfert: It will probably be at the end of the discussion.

[Translation]

The Chairman: We'll discuss it with all members of the committee after the meeting.

[English]

Mr. Bryon Wilfert: As always, I appreciate the wisdom and the guidance of the chairman.

[Translation]

The Chairman: Thank you. Are there any other questions?

In the list at table 1 of your brief, you enumerate the airports south of 60th N equipped with community airport radio stations funded by NAV CANADA, i.e. Eastmain, Waskaganish, Wemindji and Sanikiluaq. When you talk about communities North and South of the 60th parallel, is Kuujjuaraapik included in your NAV CANADA listing for Grande Rivière?

Mr. Arthur Andreassen: One second, please.

The Chairman: Eastmain, Waskaganish and Wemindji are far South of the 60th parallel; they are located between the 49th and the 52nd or 53rd parallel, if I remember correctly.

Mr. Arthur Andreassen: I will check if the list is complete and we can always change it if need be. I understand there are several community airport radio stations in Northern Quebec that are funded by the province and not by us; this is why they are not included here. But I have tried to list community airport radio stations.

The Chairman: In Grande Rivière, are the facilities funded by SEBJ?

Mr. Arthur Andreassen: I don't know.

The Chairman: But do you have too many FSS in La Grande? Thank you very much.

Please provide the information in writing. We thank you for coming before us. We know it is not easy to appear before a committee, but your views are important to the committee and the Canadian people it represents. Would you be willing to come back before the committee if we need your services a second time?

Mr. Arthur Andreassen: Certainly.

The Chairman: Thank you very much. We will break for five minutes before hearing our next witnesses.

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• 1059

The Chairman: Welcome. From the Canadian Tourism Commission, we welcome Mr. Douglas Fyfe, its President; Mrs. Joan Pollock, Manager of the European Marketing Program; and Mrs. Francine Boivin, Vice-President, Industry Competitiveness. You have the floor for a statement of 10 minutes maximum.

[English]

Mr. Douglas Fyfe (President, Canadian Tourism Commission): Perhaps less than ten minutes, with your permission.

[Translation]

The Chairman: Thank you.

[English]

Mr. Douglas Fyfe: As you can see perhaps from the background piece, the tourism industry in Canada has become a strategically important sector to the economy. It's been growing, as it does in good times, faster than the economy grows. As a consequence, it's been creating employment faster than the Canadian economy in general. Because of that there has been a considerable interest from the public and private sector in continuing the growth of this particular industry sector.

I would think that where it might be of particular interest for this committee—but that would of course be entirely up to you to decide—is that it offers the opportunity for other than cities to discover economic development and it provides employment through the full range of those people looking for work from the very high end, highly skilled and highly paid, to those who are just entering the workforce.

• 1100

It also offers one other opportunity that, again, might be of some interest to this particular committee. The tourism experience is actually the experience of the country or the people, or the culture or its natural resources. In fact that's what makes us different from Florida or some other parts of the world.

The natural differences we have are the ones we present to the marketplace in the hope that consumers will purchase that particular product. We don't want to make everything the same, because then you become a commodity and the only competition for commodities is based on price. We would prefer to compete with the rest of the world on value: that this destination offers more than almost any other part of the world of a quality they can't find elsewhere.

To do that, as you know, the Canadian Tourism Commission is a public and private sector partnership, jointly financed by those two entities. It's a marketing organization and a research organization. It does not give grants, it does not make contributions to bricks and mortar, but it does provide information about market opportunities and market constraints.

It's in that context that we have the two people accompanying me. Joan, as you know, is the manager of Europe and the marketing program. That program is where most of the interest has been expressed in the aboriginal product.

On the other hand, Francine Boivin

[Translation]

is Vice-President, Industry Competitiveness. She is responsible for dealing with problems regarding distribution of products and standards which are not always what international markets expect.

[English]

What I would prefer to do, with the permission of the chairman, is to turn it open to the committee. We would be happy to take your questions, either myself, or, if they deal with the market or if they deal with the product, we have the people here, I believe, to try to answer them.

[Translation]

The Chairman: Thank you, Mr. President and ladies. I must say, Mr. Fyfe, you speak French very well.

Mr. Douglas Fyfe: Thank you, Sir.

The Chairman: And English also.

Mr. Konrad.

[English]

Mr. Derrek Konrad: You realize our chairman is a good judge of both French and English. I can't say the same for myself.

I found it really interesting and hopeful that you say this is largely a rural activity. It seems like so much of what happens in Canada is centred on the urban parts of our country; that's where wealth is presumed to be seen, even though most of it is generated actually out in the country. It simply is handled in the cities and spent in the cities and remains there.

Having said that, I look down this list here and I see Canada's travel account deficit reached $ 3.5 billion in 1997. I take it that means we're spending more money outside the country than we are in.

When it comes to aboriginal tourism, is there a market for Canadians at home to look into their own aboriginal past, present, and future in terms of taking part in this? What exactly is our aboriginal tourism comprised of? Is it a lot of hunting and guided tours? Is it snowmobile trips in the winter and snowshoeing? What does it amount to? Or is it things that are developing? I would hope it's not Disneyland-like theme park types of development. How are we attracting people from overseas to address this problem?

Mr. Douglas Fyfe: I might begin with a couple of general comments and then I think both of my colleagues would be able to speak more particularly.

First, to the deficit, although it has grown to $ 3.5 billion, that is significantly less than it was five or six years ago. The truth of the matter is that almost all countries that do not have a warm-weather border for the winter run a deficit, and that is because a large number of the people clearly, if they have the income, leave the country during the wintertime. In that context, it would be difficult for Canada to eliminate its travel deficit, but it certainly isn't difficult for us to greatly reduce it.

• 1105

To the more particular question about the product, much of the product that the aboriginals offer is activity-based, whether it be fishing, hunting, guiding, or snowmobiling—activities in summer and winter—but not by any means all of it. A cultural experience is also offered that is quite a bit different from what is available in most other parts of the world. The work currently being done to develop that to the standards expected by the international consumer offers the opportunity for the international visitor.

Truth be known, if the international consumer buys it, so will the Canadians. Canadians are enormous consumers of travel, inside their own country as well as internationally.

Mr. Derrek Konrad: What would those standards consist of? Is it the types of restaurants available in native communities? Is it transportation infrastructure? Is it paved roads as opposed to dusty, bumpy roads, made of whatever local soils, that you mostly experience? Mosquito control? What are we talking about? Blackfly control?

Mr. Douglas Fyfe: Francine, would you like to talk to that issue?

[Translation]

Mrs. Francine Boivin (Vice-President, Industry Competitiveness, Canadian Tourism Commission): Indeed, the same problems that exist in aboriginal tourism can also be found in many other areas. The tourism industry is made up of many small businesses and some of them do not provide the level of excellence that visitors, and especially buyers of our product in the major markets, that is tour operators or wholesalers, expect. The level of service, of quality, of security, of cleanliness and so on that they expect is not always met.

Sometimes, there is simply not enough capacity to accommodate several groups at the same time. So there is also a problem of infrastructure. Groups of visitors usually come in by bus. Even if some very small restaurants can provide efficient service to a small group, they have much more difficulty accommodating 48 visitors at a time.

Aboriginals are working hard to improve in these respects. For example, Tours Innu informed me recently that they had met with the major aboriginal businesses in Quebec to establish quality standards and look at ways to improve the quality of products and services provided to tourists from abroad, and also from Canada, obviously.

So we are working on these issues. They involve several aspects and, as I said, they are not limited to Aboriginals. Some problems are more specific, for example in remote areas, but even there some of the businesspeople are non-Aboriginal.

More and more, especially in the area of ecotourism, visitors are seeking an experience as opposed to just travelling through an area. If they sleep in a tent, etc., it becomes more difficult, but we get more specialized visitors who do not expect all the comforts of a five star hotel.

The Chairman: Mr. Konrad.

[English]

Mr. Derrek Konrad: I'll pass.

[Translation]

The Chairman: Mr. Bachand.

Mr. Claude Bachand: I looked at the mandate, the goals and structure of your commission. Could you give me an idea of how it is structured? Is there aboriginal involvement in the structure itself, which would seem to be important? It says here that the operating budget comes from the government, which contributes $ 65 million, and the industry, which provides $ 80 million. So I imagine this is your operating funding and that you have $ 145 million at your disposal, which is not small potatoes. What are you doing with these $ 145 million? Do you come under a specific department?

• 1110

I think that Europeans especially are attracted to aboriginal tourism and that Aboriginals got that message also. If I look at what is happening in Kanesatake, in Quebec, Aboriginals have close contacts with wholesalers and airlines. I often meet French visitors who ask me where they could see Aboriginals. I think this industry could benefit Aboriginals, provided there is aboriginal involvement in organizations like yours. I would like to have more information on your commission, its mandate, its objectives and its organization and structure, in order to get a better idea of what you do.

[English]

Mr. Douglas Fyfe: I'd be pleased to do a little bit on the structure, and then perhaps we'll look at some of the specific questions posed.

The commission itself is 26 people, two of whom, the chairman and the president, are appointed by the Prime Minister, and the rest are appointed by the Minister of Industry, where this special agency sits. The nominations for a position on the commission come from the industry, and Minister Manley has the right to accept or reject them, but he does not pick the people.

We have public and private sector. There are seven provinces, representing all the provinces and territories, in the public sector seat. Ontario and Quebec have their own deputy minister responsible for economic development who sits on the committee. The rest of the jurisdictions split responsibility. For example, British Columbia and Yukon are represented at this time by the deputy minister from the Yukon, whereas Alberta and NWT are represented by the deputy minister from Alberta. The federal deputy from Industry Canada also sits, and he represents all of the federal interests at the table, rather than simply Industry Canada.

The private sector is made up of a number of regional private sector individuals who represent an individual part of the country. And then there are national representatives: Air Canada; Air Transat; CP Hotels and Resorts, which represents the chain hotels; Don Ziraldo of Inniskillin Wines, recently appointed from Ontario as a businessman who is heavily involved in the tourism industry; and John Kim Bell, who until recently represented entertainment and the aboriginal community. His term is up on the board, and we are now seeking nominations from the various aboriginal constituencies as to people who would be considered to sit on the board and represent the aboriginal interests.

The staff are mostly federal employees, but with executive interchange from the provinces and the private sector, some 60 or 65 people in Ottawa and another 70 who worked for International Affairs until January 1 are now part of our staff abroad who sell the Canadian product.

Those staff members, of whom Francine and Joan are representative, as am I, work for various committees headed by the private sector. They are divided by geographic interest. There is a marketing organization responsible for the Americas, mostly the United States. That's some $ 50 million a year. There is a marketing organization responsible for Europe, some $ 20 million a year. Similarly for Asia, another $ 20 million. And there's a research program, a product development program, and a domestic program. The Canadian program itself is some $ 10 million.

Until recently there was also an aboriginal program, but it has matured over three years, so now the committee itself has disbanded, and the members have joined those other committees I described to ensure that the aboriginal program is represented in Europe, Asia, the United States, and research and product development.

• 1115

So that's how we're structured. The private sector committees design the marketing programs with the industry, they recommend those programs to the board, and the board approves them. The staff then implement and report back, and if we're successful, we're allowed to continue.

There is a great deal of demand for the product, as you noted, in Europe.

Joan, you might just very briefly speak to the demand more generally, perhaps.

Ms. Joan Pollock (Manager, European Marketing Program, Canadian Tourism Commission): Yes, I'd be pleased to do that.

When we were mandated by the board of directors three years ago to dedicate effort to aboriginal tourism product, we looked at all the research we had and we commissioned some research. This was global. To the prior member's point, yes, there is demand in Canada, but as you've pointed out, sir, by far the highest concentration of demand for aboriginal product in Canada was found in Europe, in particular in France and in Germany.

The consumer research we did told us a lot about the types of consumers and the kinds of things they're looking for. We found out that aboriginal product and aboriginal experience were demanded by the consumer as part of a set of experiences they would wish to have in Canada, which included the outdoors, history, and nature. These are the types of travel experiences that the French and the Germans in particular sought, and they were very interested in the set of benefits around aboriginal product.

In fact 67% of Europeans who travel outside of, let's say, continental Europe—a three-hour-plus air flight—are interested in aboriginal tourism experiences. If you put some numbers around that, it gets quite large; it ends up being about 1.5 million Europeans.

So we have focused a great deal of effort in the European market over the last three years to try to cultivate that. We've worked with tour operators. We've had many, many promotions and trade shows where we've taken over aboriginal tourism suppliers to do business, to make the people who sell tourism in Europe aware of the product, the calibre of the product, the variety, and the accessibility. And we know most of the people who do sell it are located as well in France and Germany, so there's a great deal of coincidence between those who want it and those who package it. Business works like this, oddly enough.

We're continuing that this year and expanding some activity into the Canadian market and the U.S. market as well.

[Translation]

The Chairman: Thank you. Mr. Bachand.

Mr. Claude Bachand: Could you provide us with the list of your board members? I have to say I would be very interested in visiting your office. Are all the people you talked about located on the fourth floor of the West Tower, at 235 Queen Street?

Mr. Douglas Fyfe: We have moved to the eighth floor of the West Tower.

Mr. Claude Bachand: I would appreciate having your business cards. I would like to see what type of services you provide.

Mr. Douglas Fyfe: Absolutely. It would be a pleasure.

The Chairman: Thank you, Mr. Bachand. Any other questions? Thank you very much.

Mr. Konrad.

[English]

Mr. Derrek Konrad: We have quite a bit of tourism of that nature in my area, not necessarily aboriginal. People from Europe in my riding are developing a rural farming experience for tourists, and of course they all like to sit around in this rough area with the white tablecloth on and wine and soft music playing. Is this the kind of person we're looking at attracting and is this the way aboriginal tourism is going to have to be presented and sold to be successful? It's one of the fastest-growing family operations in my riding.

Mr. Douglas Fyfe: Any consumer group has to be segmented so that you can sell a product to the particular interest. There are people who buy Volkswagens and people who buy Rolls Royces, and it's not any different in the travel business.

There are certainly people who will never leave the city. They want theatre and Martinis and 26th-floor views. There are others who would like to experience a modest amount of the wilderness, but they want to be able to come home to the white linen. Many of us are in that latter category—soft adventure, I think they call it.

• 1120

But there certainly are a large number of individuals who look for a more realistic or authentic outdoor experience. It's usually a younger group, perhaps a little more vigorous. They will look for long snowmobile rides—2,000-mile rides—or they will go whitewater rafting and hiking in quite remote places. So there is a demand for a wide range of the product through the wide range of the consumers, and distribution channels now to reach them.

Mr. Derrek Konrad: Are these things being developed? And where is the financing coming from to put this together? If people want these things, it obviously requires a fair bit of infrastructure and planning. You don't go on a long snowmobile trip without places to stop and stay, and places to obtain food, gasoline, repairs, medical services—the whole range of things. Is that being put in place? Where and how is it happening? Do you have advice for this committee that we can pass on to other communities that may not have heard of these things?

Mr. Douglas Fyfe: Sure.

Francine, you've been working particularly on the financing side. You might wish to speak to that.

[Translation]

Mrs. Francine Boivin: With regards to funding, we have tried to bring together all federal agencies involved in funding, that is regional agencies like ACOA, Western Diversification, FedNor, and ABC, Aboriginal Business Canada, which is a portfolio within Industry Canada, in order to get a better grasp of all investments being made in the tourism industry because, as we mentioned earlier, we do not provide funding for this type of development. We expect to have more meetings in order to determine what investments provinces are making. Our idea, with this exchange of information, is to try to establish a better coordination or harmonization. There is lots of capital available, but some sectors are not getting enough, for example the very small business sector. Anything having to do with adventure scares banks. Festivals, special events are also viewed as scary. So we are trying to eliminate some myths in this regard. Tourism has a bad reputation that seems tied to the restaurant sector where the rate of business failure is very high.

Therefore, we have started to try and demystify these ideas. It is our intention to bring to the table investors and bankers to show them how things really are and to make them more receptive to small business people, both Aboriginals and others.

We have also prepared a guide which I can leave you. It is a first. We will review it in the fall in light of recommendations made. This guide is specifically aimed at businesses in the travel sector and lists most of the programs available to them. I believe this is an important source of information. I brought two copies, one in English, one in French, and I can send you more. Your comments would be welcome since we anticipate a revised edition in the fall. Up to now, the feedback has been very positive.

As for financing, I don't think there is really a shortage of capital. What we need to do is to get a better match between projects, the quality and presentation of projects, and the level of knowledge of investors and their fears, whether justified or not, when looking at those projects.

The Chairman: Mr. Patry.

Mr. Bernard Patry: I have one or two small questions regarding the Canadian Tourism Commission.

First, you obviously provide consulting and marketing studies. Do you carry these out domestically or in other countries, and what countries are you presently targeting or priorizing? How do you conduct these marketing studies?

• 1125

[English]

Ms. Joan Pollock: We generally do conduct studies in all the major markets where we are marketing. We have them in Europe, in Asia Pacific and in the U.S. We don't do them every year everywhere, because obviously good research is expensive. That's how we then can develop the marketing programs that we do develop. We go to where we believe the greatest potential is, and we try to position the product in the light it will meet the set of benefits required by the market. It's very market-driven.

Mr. Bernard Patry: Do you have some evaluation process after you market, let's say a couple of days after, if it was okay? Sometimes you can have a 100% success. Do you have some way to find out if it was good or not?

Ms. Joan Pollock: Yes, we do. Depending on the activity, we do try to measure the results of everything we do. If it's a marketing campaign with tour operators, we will go back to the tour operators and ask them what they sold as a result of the campaign we partnered with them—for example, German tour operators selling aboriginal product. If it's other kinds of advertising, or let's say it's public relations where we're trying to get media coverage, we can obviously track and value the media coverage.

[Translation]

Mr. Bernard Patry: I would like to ask another question and not only of Mrs. Boivin. About two or three weeks ago, the committee travelled to the far North of Quebec and the Cree territory. We went to Oujé-Bougoumou. This village is quite a success. We found it very interesting. Is a destination like Oujé-Bougoumou part of the area you cover within Quebec or is it too remote, being close to Chibougamau? Does this destination attract only local tourists, those of Quebec and Ontario, or also Americans?

Mrs. Francine Boivin: I believe the village of Oujé-Bougoumou has been designed by the same architect as ...

Mr. Bernard Patry: Yes, by the architect from Alberta, Douglas Cardinal.

The Chairman: Who has been recognized by the UN.

Mr. Bernard Patry: Who has been recognized and been awarded prizes by the United Nations.

Mrs. Francine Boivin: I have to admit that I don't really know the facilities in Oujé-Bougoumou. No area is too remote to be considered a destination that can be marketed internationally. There are already destinations in Inuit territory or the far north. For example, in the Northwest Territories, we were very successful in developing the Northern lights as a destination. It is very far away but it works fine. Air Transat now has a direct flight from Europe to the Yukon. It proves that when a product is attractive and meets the required quality standards, it can work. Please, pardon my ignorance.

Mr. Bernard Patry: No, no, no.

Mrs. Francine Boivin: I don't know if a program has been developed to draw foreign visitors to this village. Maybe they decided to aim for local or regional tourism. If people in this village have a good product, we would certainly be interested in a partnership, which could be established with the province or in some other form. Regions or destinations don't always deal directly with us. Sometimes it is within a wider partnership.

Mr. Bernard Patry: Oujé-Bougoumou is a small village with excellent facilities. We slept there. It is also possible to sleep in a tent. However, they want to develop a cultural experience and they are just starting out. Before going there, we had never heard of this village. We have found out since that it is really great. However, they could not accommodate groups of 50 or 100 people, because the village is too small.

Mrs. Francine Boivin: Yes, but you also have smaller groups taking part in more specific tours, which are sometimes tailor-made and cost more. It might be possible. It could be this village is part of the group set up by Tours Innu which I talked about earlier. I don't yet have the names of all the people who are part of this. I have not been able to go to this meeting.

Mr. Bernard Patry: Mamuietan follows mainly the St. Lawrence River, on this side of Quebec, and includes Essipit and those villages. Thank you.

The Chairman: Thank you, Madam. Allow me to mention that Oujé-Bougoumou has been recognized by the United Nations. They published a full page ad in the travellers magazine of Quebec etc. I talked with Chief Abel Bosum of Chibougamau. They appointed one staff member of the municipality to deal specifically with tourism. Thank you very much. No other questions?

Some honourable members: No.

• 1130

The Chairman: Thank you very much. We greatly appreciated the evidence you gave us.

We will now take five minutes to discuss the motions which have been tabled. Since we don't have a quorum, we won't be able to vote on them. Would it be better to wait for a quorum to discuss these motions and put them to a vote?

Mr. Bernard Patry: We could start the discussion right away. Very well. Let's recess for three or four minutes.

The Chairman: Okay.

• 1131

• 1142

The Chairman: Mr. Wilfert, could you read your motion, please? I can read your writing very well, but it is better if it comes from you.

[English]

Mr. Bryon Wilfert: I appreciate that you understand my writing, Mr. Chairman, because some people thought I should have been a doctor. I used to teach, of course, and you can imagine how that was. But since the advent of the computer, my writing has gone....

My motion:

After hearing from representatives of NAV CANADA and given the emergency resolution of the Federation of Canadian Municipalities (FCM) concerning airport safety issues (supported and presented by the Northern Forum of the FCM—representatives of northern and remote communities) the Standing Committee on Aboriginal Affairs and Northern Development respectfully requests the Minister of Transportation to conduct a comprehensive review concerning such issues as air safety and increase in user fees in the North as examples before granting authorization to phase II and phase III charges.

[Translation]

The Chairman: Mr. Patry.

Mr. Bernard Patry: At the request of my colleague, Mr. Wilfert, I consulted the representative of the Bloc Québécois, Mr. Bachand, and we wrote a preliminary translation of the motion, which is probably not as good as that of official translators. I will read the motion since the text has to be tabled in both official languages.

After hearing from representatives of NAV CANADA and given the emergency resolution of the Federation of Canadian Municipalities concerning airport safety issues (supported and presented by the Northern Forum of the FCM representatives of northern and remote communities), the Standing Committee of Aboriginal and Northern Affairs respectfully requests the Minister of Transportation conduct a comprehensive review concerning such issues as air safety, increases in user fees in the North as examples before granting authorization for phase II and phase III charges.

The Chairman: Mr. Patry, let's start the discussion.

[English]

Mr. Derrek Konrad: Maybe rather than saying “as examples before granting authorization to phase II and phase III charges”, you might just want to say “before implementing further phases for charges”. Otherwise, you tie your motion down. It's just a technical thing.

• 1145

They can't even get to phase two if they don't do this, never mind phase three.

Mr. Bryon Wilfert: I'd accept a friendly amendment. I have no problem with that.

Mr. Derrek Konrad: It's just an editorial comment.

Mr. Bryon Wilfert: I would incorporate your—

[Translation]

The Chairman: That is a good comment, Mr. Konrad.

Do you agree to mention only phase II, Mr. Wilfert?

Mr. Bernard Patry: No problem. We won't be able to put this resolution to a vote since we don't have a quorum. So it is simply a wish that we forward to the Minister of Transport.

The Chairman: The message is very clear.

Mr. Bernard Patry: Yes, but it is not a motion since without a quorum we can't have a vote.

The Chairman: It says exactly what our colleague Nancy said about the importance of security for people travelling in the North.

Mr. Bernard Patry: Yes, it says exactly that, Mr. Chairman.

The Chairman: End of discussion?

Mr. Bernard Patry: Yes, agreed.

The Chairman: Very well. Thank you very much.

Mr. Konrad.

[English]

Mr. Derrek Konrad: I'm just referring back to my previous notice of motion. I've incorporated some changes that were requested by Mr. Finlay on behalf of Mr. Wilfert, I guess, to increase the scope from simply referring to British Columbia to how economic development will be impacted right across Canada, because obviously it has national implications. I agree with that and am prepared to substitute that for the motion I introduced yesterday.

[Translation]

The Chairman: The motion that was tabled yesterday requested the Standing Committee on Aboriginal Affairs and Northern Development examine and report to the House the repercussions of the decision by the Supreme Court of Canada in the case of Delgamuukw v. British Columbia, dated December 11, 1997, on the economic development and land claims of Aboriginals in British Columbia and throughout Canada.

Mr. Patry.

[English]

Mr. Bernard Patry: Thank you, Mr. Chair.

This is a notice of motion, so we're not going to vote on this one like the previous one because we don't have a quorum. I agree with the fact that this Delgamuukw decision has an impact not just in B.C. but all across the country, and I think it's good to change this. It's a better notice of motion. This will be discussed later on, but we fully agree with the deposit of this notice of motion.

[Translation]

The Chairman: Thank you very much.

End of discussion?

I want to thank our translators, our staff, our clerk, Jill, our console operators and all those who work with us and support us. We wish you all a great summer.

The meeting is adjourned.