TRAN Committee Meeting

     I call this meeting to order.

    Welcome to meeting number eight of the Standing Committee on Transport, Infrastructure and Communities. Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, September 18, 2025, the committee is resuming its study of the Canada Infrastructure Bank's loan for new vessels for British Columbia Ferry Services Incorporated.

    Today's meeting is taking place in a hybrid format pursuant to the Standing Orders. I'd like to take a moment to make a few comments for the benefit of our witnesses and our members.

    Please wait until I recognize you by name before speaking. For those participating by video conference, please click on the microphone icon to activate your mic, and please mute yourself when you are not speaking. For those on Zoom, at the bottom of your screen you can select the appropriate channel for interpretation: floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

    This is a reminder that all comments should be addressed through the chair.

    Also for those joining us by video conference, I have two placards, one in yellow and one in red. If I raise the yellow one, it means that you have 15 seconds left, and I ask you kindly to wrap up your remarks. If I raise the red, it means that I will unfortunately have to cut you off mid-remarks. We try to avoid the red.

    I'd like to now welcome our witnesses. For the first hour today, we have with us by video conference, from BC Ferry and Marine Workers' Union, Eric McNeely, president, and we have, from the United Steelworkers union, Marty Warren, national director, as well as Meg Gingrich, assistant to the national director.

    I'd like to thank you all for being here, especially at the God-awful time that many of you are joining us locally.

    We also inflict pain on our members. Today I would like to point out that it is Mr. Will Greaves' birthday. He is a member of Parliament—

    Some hon. members: Hear, hear!

    The Chair: —representing a British Columbia constituency, so he too was forced to wake up at 4:15 B.C. time.

    On a point of order, as the chair was a member of a prominent boy band in Quebec, I believe he should sing happy birthday to Will.

    I call that out of order. That is overruled, sir.

    Some hon. members: Oh, oh!

    The Chair: Thank you very much for taking the time to appear before us today.

    We'll start our opening remarks off with Mr. McNeely.

    Mr. McNeely, the floor is yours. You have up to five minutes, please.

     Good morning and thank you, Mr. Chair and members of the committee.

    My name is Eric McNeely. I am president of the BC Ferry and Marine Workers' Union. We represent more than 4,500 ferry workers across British Columbia, making us the largest maritime-focused union in Canada. Our members load the vessels, sail them, maintain them and repair them. We keep coastal communities connected every single day.

    BC Ferries' decision to use Canada Infrastructure Bank funds to build its next four vessels overseas is really a choice about what kind of country we want to be. Do we want to keep outsourcing our industry? Do we want to be dependent on other nations to supply our domestic vessels and short sea shipping, or do we want to build a marine industry in Canada for our kids to build, load, maintain and operate vessels? Do we want to start investing in Canadian workers and Canadian communities?

    When BC Ferries sends contracts offshore, we lose more than work orders. We lose apprenticeships for the next generation. We lose good, family-supporting jobs. We lose tax dollars that would circulate in our economy. Most of all, we lose shipbuilding capacity here at home. Every vessel built offshore weakens our country.

    We're told it's cheaper, but when you look beyond the sticker price, the story changes. When you build offshore, you inherit offshore problems. Big ships' parts don't ship like a package from Temu. They weigh tonnes, require special handling and take weeks or months to source. Technology designed for another market isn't always compatible here. We've lived this. When BC Ferries brought in ships from Germany, we had to special-order washroom tap sensors from Europe, because North American parts wouldn't fit. When a motor failed, the repair team had to be flown in. A vessel from Greece arrived without the proper collision bulkhead and had to be rebuilt. We've also seen issues with foreign steel and proprietary systems that left us waiting on foreign suppliers for critical parts.

    All of these impact service, leaving grandma waiting on the proverbial tarmac for a ferry that never comes. When passengers are left stranded, it's our members holding the bag, trying to explain why the ferry won't sail, fixing the problems and sailing behind schedule.

    Each one of these so-called savings ended up costing more through delays, repairs, reputation and retrofits. These aren't isolated examples. They're part of a track record of poor planning and poor leadership, with higher costs tied directly to offshore builds. We can't keep letting this happen.

    Public funds should come with requirements for Canadian material and jobs. Otherwise, we're paying for the illusion of savings while making ourselves dependent on foreign markets and builders. Canadians would never accept being flown on the cheapest airline money can buy. Our ferries are no different.

    This isn't new. BC Ferries had ships built in Germany, Romania and Poland, including at yards that used North Korean labour. They have purchased used vessels from Greece. Now they are contracting with a hybrid civil-military shipyard run by the Chinese government.

    Each decision further erodes our Canadian capacity. Canada is a seafaring nation, with the longest coastline in the world. Our shipyards have built fleets that helped win wars and carried goods to every corner of the world. That tradition has diminished, but it has not disappeared. We still have large players, such as Seaspan, Davie and Irving, and we still have smaller yards, such as Allied, Point Hope, Kehoe, and Ontario Shipyards, to name a few. With predictable work, these yards can keep alive the skills that Canada needs to remain a seafaring nation.

    We know that this committee doesn't control BC Ferries' governance. Some would question whether anyone does, or whether it is a jurisdictional game of finger pointing with public funds at stake. But the federal government does have a role. Ottawa has a national shipbuilding strategy that covers our navy and Coast Guard. Ferries should be part of that national strategy. Ferries move millions of Canadians every year. They are no different from our highways.

    Our ask is simple. When public money builds public vessels, those contracts should stay in Canada—with Canadian steel, Canadian workers and Canadian know-how. Ferry workers keep my province and our country moving every single day. They deserve ships that are safe, reliable and proudly built in Canada in Canadian shipyards, so make it right and don't let this happen again.

    Thank you.

    Thank you very much, Mr. McNeely.

    We'll now go to the United Steelworkers Union. I'll turn the floor over to Marty Warren and Meg Gingrich.

    The floor is yours. You have five minutes, please.

     Good morning, Mr. Chair and members of the committee.

    My name is Marty Warren, and I'm the national director for the United Steelworkers union, and Meg Gingrich is my assistant.

    Our union represents over 225,000 workers across this country. USW members make up the backbone of Canada's industrial supply chains, from resource extraction and processing to manufacturing and fabrication. Like many Canadians, our members were frustrated and disappointed to learn about the decision by BC Ferries to spend $1.2 billion on new vessels to be built in China. We were even more disappointed to learn that this purchase was supported by federal government financing. It strikes people as absurd that the country with the longest coastline in the world, a proud shipbuilding tradition and a highly skilled workforce is unable to build these ferries at home.

    What makes it harder to accept is that Canadian taxpayer dollars are being used to subsidize foreign shipyards rather than to create jobs and support communities here in Canada. We must acknowledge that this debacle cannot be laid solely at the feet of the current federal and B.C. provincial governments. It is a product of a failed industrial and economic model that has been in the making for decades.

    Procurement in this country has been guided by the lowest cost at any price, without regard for long-term benefits, national industrial capacity or supply chain security. The tender process for BC Ferries prioritized the cheapest bid, leaving no space for domestic content requirements or the strategic value of Canadian vessels built with Canadian steel and by Canadian workers. Our shipyards were set up to fail before they even had a chance to compete.

    The reality is that markets are not truly free. Countries like China and many other trading partners have built massive overcapacity supported by subsidies, low wages and weak labour and environmental standards. No Canadian shipyard can compete on cost alone when the playing field is tilted in that way.

    Canada, by contrast, has too often left our industries exposed by failing to match the protections and supports that other countries provide. Instead of treating domestic industrial capacity as a strategic priority, we've allowed it to become an afterthought, and this BC Ferries case shows the consequences.

    The question before us is this: How do we prevent this from happening again? We need a clear and enforceable buy Canadian and buy clean policy. Public dollars must support Canadian jobs and communities. Every major infrastructure project financed by taxpayers should require Canadian content with binding commitments for Canadian-made products and labour. We need stronger and permanent trade enforcement to prevent dumping and to give the CBSA the resources it needs to do the job.

    Finally, we need a bold Canadian industrial strategy that treats economic resilience and industrial capacity as matters of national security. This means aligning the mandates of Crown corporations so that financing is tied directly to domestic benefits. Procurement, trade, investment and innovation must all be linked under this strategy, with Canadian workers at the centre of building the infrastructure of the future.

    The frustration Canadians feel is real, but if we stop there, we miss the bigger point. The real issue is that our policies allowed this to happen. The solutions are within our reach if we choose to act. Canada has the workers, the know-how and the resources to build at home. What we lack is the political will and the policy framework to make it happen.

    The next billion-dollar project must not subsidize foreign competition; it must build Canadian capacity, Canadian jobs and Canadian communities.

    Thank you. We look forward to any questions.

    Thank you very much, Mr. Warren.

    We'll begin our line of questioning today with Dr. Lewis.

    Dr. Lewis, the floor is yours. You have six minutes, please.

    Thank you, Chair.

    Thank you for being here, Mr. Warren. My first question is directed to you.

    In Nanticoke, a town just a few minutes away from where I live, there is a steel mill company called Stelco that employs thousands of workers and drives our local economy. These are the same workers who are suffering and battling unjustified U.S. tariffs. A $1-billion taxpayer-funded ferry contract being handed to a Chinese state shipyard feels like a slap in the face from the Liberal Party.

    Mr. Warren, could Canadian steel producers like Stelco have supplied the steel required for these ferries if these ferries had been built in Canada?

     There are definitely steel producers in Canada that can produce it. As for Nanticoke, what we call the lake operation...I'm not sure, but I know that Algoma, which is big trouble and on its knees right now—it's just so fragile in the Soo—has a history of doing it. Whatever the steel, I think most steel manufactures could do it, but to do a one-off is difficult. We need a commitment and, maybe, investment in technology to change the process so we can do it.

    However, my answer to your question is, yes, that steel for those ships could have been provided by Canadian producers.

    Thank you for that answer.

    You spoke about the economic activity in your opening. Can you expand on things, including the fabrication, transport and downstream supply chains? What level of this did Canada forfeit by sending these jobs offshore?

    I think that's such an important question because it forfeited many jobs. I can't list them all. The supply chain is just as important, for argument's sake, as the steel and ship itself. There are many jobs and communities that, somewhat like the auto industry, quite frankly, have so many other links in Canada. If we do it right, then many communities and workers can benefit, from shipbuilding through to the supply chain.

    Meg, I don't know whether you want to comment on that.

    No. I think that's essentially it. We lose out on those jobs. That's the importance of having a bold industrial strategy so we're not going to lose out on these because we lost that capacity or hadn't maintained or built it. It needs to be brought into that larger capacity, looking beyond just defence to commercial ships, ferries and things like that as well.

    It's fair to say that Canada lost thousands of unionized jobs for the steelworkers who would have been related to this contract. Given that some of your union members paid the taxes that went to this billion-dollar contract that was doled out by the CIB—which the Liberal Party did not intervene to stop—do you believe that BC Ferries and the CIB could have structured the loan procurement rules to require Canadian steel content and Canadian jobs, ensuring that domestic jobs and industrial capacity were supported rather than going to our competitors?

    Yes, I think that is exactly what could and should have been done.

    To your original point, when we just race to the bottom for the cheapest price, what we really lose is the taxpayer base. A lot of these jobs are good jobs—raise a family, perhaps own a home, retire in dignity—and when that work isn't provided to Canadians, we lose the tax base for hospitals, education and infrastructure. As we move forward, you have to look at more than the bottom line.

    It's not just this generation that's losing. This is the loss of generational capacity and the opportunity to strengthen our industry and shipbuilding industry. This opportunity was effectively handed to the Chinese-owned shipyard. Can you speak about the loss of generational capacity?

    Absolutely...and I think Eric McNeely mentioned it too. It's generational, especially in the steel industry with many generations in it. In many industrial sectors, whether it be mining or other sectors, it's passed down. It's generational. Again, in this here economy, and with the tariff threat, it's so important we do everything for our future generations. One of the first steps we can take is protecting our domestic market and creating a domestic market where we don't have it. The biggest point Eric made, I believe, and even Meg made, is that, when these skills and industries leave, most of them won't come back. We lose that for generations to come.

    That's very sad for Canada.

    We have an infrastructure bank in Canada. Section 3 mandates and requires that investments generate social and economic benefits for Canadians. In your opinion, with a billion-dollar taxpayer-funded loan to China for these ferries that excludes Canadian workers and benefits, would you say that mandate was reached in providing economic and social benefits to Canada?

    It was a complete failure. What could have been done and set up, not only for the first two to four ships—there are another 14 coming—is that we could have invested in the infrastructure where we lacked it to do it ourselves and provided good-paying jobs for our tax base and our communities. It was a debacle, and, as I said, a failure.

     Thank you very much, Dr. Lewis.

    Thank you, Mr. Warren.

    Next we have Mr. Kelloway.

    Mr. Kelloway, the floor is yours. You have six minutes.

    Thanks, Mr. Chair.

    Thanks to the witnesses for being here, given the time it is in B.C. It's really important to just comment for a second. It's great to see the unions here. I grew up in a union house, a UMW house. My father was a coal miner for 40 years. We were raised in a union environment, a union family, and it provided us with a great deal.

    I want to start off with Mr. McNeely .

    During your opening remarks you talked about the importance of the national shipbuilding program, the procurement process and what that's done for Seaspan and jobs in B.C. and in the supply chain. Also in Quebec and in my home area.... It's four and a half hours away to Halifax, but the impacts are felt in Cape Breton in terms of jobs and the supply chain. When we're talking about this particular item, around BC Ferries, it's a provincial Crown corporation and provincial procurement process, but from your experience, sir, what things can perhaps the provincial government, the Crown corporation, BC Ferries, learn from the procurement process federally?

    If you look at the investments that were made across the country from coast to coast, they were substantial and the impact was good-paying jobs across the board in every conceivable trade through the supply chain. I'm wondering: What did we learn federally that the provincial Crown corporation can learn, not tomorrow but today, in terms of their procurement process?

    You're right. I think it was Mr. Warren who said we need to prevent this from happening from a provincial standpoint. What can we be doing to learn from the federal side?

    Thank you for the question.

    In terms of procurement and what we can learn from it, if this process is started or concluded in a more timely fashion.... The original plan began seven years ago. If those steps had been taken in a timely way, we wouldn't be sitting here waiting 30 years for new vessels and now in a situation where we're being told we can't wait. It's because no one planned for us to be ready.

    It's not an excuse to keep offshoring. It's a sign that we need a real shipbuilding strategy that works for British Columbians, that works for Canadians. BC Ferries started planning these vessel replacements over seven years ago. There was plenty of time to work with Canadian yards. There was plenty of time to work with the Canada Infrastructure Bank. Fundamentally, because the process was so protracted, there are now questions about capacity at this moment, but there would have been time if this procurement process had been more thoughtful and more timely.

    In essence, in terms of planning on BC Ferries' part, I think there are six vessels that need to be replaced, four immediately, and this shouldn't have been news to British Columbia or BC Ferries. That's what you're saying. The planning was lacking here on BC Ferries' part.

    That's correct. In terms of the execution of the planning, if we look back to 2017-18, there was a vessel replacement plan that included beginning in 2023-24. We looked to reports that were done by large shipyards, and they were saying that if they began the projects in 2025, they could have the first major vessel produced and in the water for 2029. That's the same timeline as we're getting from China, starting now.

    Clearly there was an opportunity. There was an ability to do this, and to brother Marty Warren's point, those are hundreds and potentially thousands of good-paying jobs and part of a process that would maintain our ability to plan and procure further vessels in addition to the ones we're talking about today.

    Thank you, Mr. McNeely, for that because I think we need to dig deep as to why this happened on BC Ferries' part and how we prevent it from happening, even though it's a provincial entity.

    I want to go to Mr. Warren.

    Thanks for your testimony, sir. I really appreciate it. As you mentioned, the steel industry is under attack. There's no two ways to talk about it. We're under attack from U.S. tariffs, and I think you did allude to this but we see the federal government putting initiatives in place, making investments to protect the industry. More needs to be done clearly, but I'm wondering what all levels of government can do. In particular, when we look at this example—we need to do more on the federal side and we're doing more—on the provincial side, when we look at the anatomy of this issue, it is predominantly BC Ferries, their planning perhaps.

    What could we be doing in terms of protecting steelworkers, not just federally but also provincially?

     That's a good question. Thank you.

    Just so you understand and so folks understand, a nation without a steel industry is.... I'm not sure you can call it a nation, quite frankly, but just so you're aware, this is how important this kind of stuff and procurement are. Right now, a lot of our products are being shut out of the U.S. market. Sixty-five per cent used to go down there. We're being shut out. We have access to only 35% of the domestic market right now because of the foreign steel that's being shipped into Canada.

    How do we do this? How do we support it?

    First of all, we have to take action with bigger and more quotas to support industries that are under attack, where they can't get a footing in the domestic market. Most important, to your question, for the same federal procurement that we're excited about, that we like, we have to drill that down. We have to do a good job with our provincial leaders and make sure that they're doing procurement in the provinces as well.

    Thank you, Mr. Warren.

    That's all, Mr. Kelloway.

    I assumed the colour red was not a good sign.

    Voices: Oh, oh!

     Thank you very much, Mr. Warren.

    Thank you, Mr. Kelloway.

    Mr. Barsalou‑Duval for six minutes.

    Thank you, Mr. Chair.

    I want to thank the witnesses for joining us.

    There's a steel mill in my riding, specifically in Contrecœur, where the workers are members of the United Steelworkers Union. It employs almost 1,000 people.

    BC Ferries awarded the government-funded contract to build boats to a Chinese company. I've heard a lot about it, because these workers in my region see their industry struggling and they're aware of the tariffs imposed by the United States. At the same time, the government is making promises but ultimately does something else, which is creating significant disappointment and concern.

    Mr. Warren, I was wondering whether you'd heard similar comments from members of the union you represent to those I heard.

    I'll jump on that and leave some time for Eric as well.

    Absolutely, and it's not only steelworkers who are wondering what is going on, even everyday workers are. We're being attacked by the U.S. in many sectors. Let's not forget auto, aluminum and forestry. Now more than ever, we need the government to stand up and protect our domestic industries.

     We know that we have to diversify. We know that we have to invest in technology in certain parts of these sectors. For example, we don't build a bit of I-beam steel in Canada. It looks like some of the producers—Algoma specifically—are going to start to produce I-beams in Canada so that we never have to import another one, or very few, from foreign countries or the U.S.

    The answer is yes. We're all very outraged and very upset that this type of project was sent overseas.

    Eric, I hope I've left you some time.

    Thanks.

     That's a great point. Our members still maintain these ferries, and we know what happens when supply trains stretch across oceans. This reduction means that we're paying for these ferries twice: once when we buy them and once again in lost jobs, lost training and lost taxes and capacity. That's a frustration for our members, and that's a frustration for people across Canada, I think, not just on the west coast.

    Approximately two weeks ago, I had the opportunity to visit the Davie shipyard, in the Lévis region, whose representatives told me they would've liked to get the contract to build these boats.

    According to them, the problem had something to do with how the request for proposals was done, which made it extremely difficult to be competitive. They mentioned in particular that cost was the sole criterion. Furthermore, they said it happened at the last minute, which gave them insufficient time to adjust their production schedule, among other things. However, they would've had the space to execute the contract and they would've been able to create or increase production capacity and hire people. So it wouldn't have been a problem. However, they feel it's unfortunate the government has no long-term vision. That seems to echo the comments you and Mr. Warren got.

    They also told me that China currently holds approximately 65% of the world's shipbuilding capacity, compared to just 5% about 10 years ago. What's your reaction, given that Canada is somewhat of an accomplice to China's cornering almost the entire global shipbuilding market?

     It's not lost on me that today is World Maritime Day, and here were are talking about things that impact the maritime industry.

    To your point about the shipyards, the only thing the lack of bids proves is that the process was stacked against domestic yards. It's time for our government to invest in our workers, because no yard in Canada is going to scale up if work keeps going overseas, and 65% of commercial shipbuilding is done in China. Unless we invest in the industry at home and we stop sending contracts overseas, we're not going to have an industry. To Marty's point, if we don't have an industry for shipbuilding, we're going to lose reasons to use our steel. If we lose our steel, we lose our domestic capacity and our sovereignty and independence in that field.

    We need to provide a process that makes it so that future builds can put value on supporting local jobs, using local materials and continuing to reinforce local supply chains, because that's how we build a country that works. If we want to talk about large national projects, I can't think of a larger national project in a country with a massive coastline than shipbuilding.

    I don't know whether I have much time left, but I'd like to ask representatives of both organizations a quick question.

    If I understand correctly, you both agree that any federally funded shipbuilding project, meaning funded by taxpayers, should be built here, in Canada. Do you agree on that? It seems quite logical, but I would still like it on record.

    I fully agree with that. If there are taxpayers' dollars involved, quite frankly, federally or provincially, the best domestic procurement should be taking place.

    Yes, I agree, 100%: public money, public projects.

    Thank you very much.

    Thank you, Mr. Barsalou‑Duval.

    Now we go to our second round of questions, and for that I'll turn the floor over to Mr. Muys.

    Mr. Muys, you have five minutes, please.

    Thank you, Mr. Chair.

    Thank you to the witnesses, especially those who were up well before the crack of dawn. As a morning person, I appreciate it.

    Let me just note up front that the Canada Infrastructure Bank's approval of the loan on March 5, 2025, took place at a time when we already had the looming threat of tariffs on Canadian steel. That was already evident at that time, yet it went ahead. The government was not straight with Canadians about the process and the timeline for what happened, and it really didn't come to light until June.

    The question that should be asked is what all levels of government can do. Yes, this was a provincial procurement, but there's a role in it that's being fleshed out here in the testimony for a Canadian industrial strategy. That is something the federal government has a direct role in.

    I would note that, in the early part of September, there was a summit in Hamilton. I'm a Hamilton-area MP and have been to Stelco many times. This summer I was at Dofasco summit, and it was entitled “Made in Canada: Ferries and Rail Summit”. How ironic it is that this would be the title of the summit taking place after a billion dollars in taxpayer funds went to subsidizing the construction of ferries in China.

    I'll ask the United Steelworkers this: Were you invited to that summit?

    Yes, we were invited, and I did attend virtually.

    That's just another example of federal and provincial governments, through consultation, bringing industries together to talk about big projects, to talk about how they may have to invest or change their process a little bit to be involved. What I saw there was a lot of connecting the dots in terms of different industries connecting.

    We talk about procurement, and that is so important, but the step after procurement is to work with sectors and industries to get them in the room to talk about the process and who can do what. I thought the summit was good in terms of just seeing a lot of businesses, quite frankly, connect the dots.

     That's not new. I've met with the USW before, and they've talked often, as you did today, about the essential role of the steel industry in the Canadian economy—in any economy—and that investment in infrastructure in Canada should be using Canadian steel.

    Similar to Mr. Barsalou-Duval, I actually had the opportunity to visit a shipyard recently. Ontario Shipyards is located on the Hamilton port, as well as in Port Weller, in St. Catharines. It was also at that summit.

    Here we have a local shipbuilder that has capabilities that could be part of that industrial strategy, that could be part of building this out, and it was out of the loop. It's actually not part of the national shipbuilding strategy, so that's an oversight for sure. Do you have any comments on that? This shipbuilder uses local labour. It uses local steel in what it does.

     Mr. Warren and Mr. McNeely, do you have any comments on that?

    Sure.

    We get the industry we plan for, and no one planned to keep this work in Canada. Two Canadian shipyards did look at the bid for the new major vessels, and they walked away because it was clear that the lowest price would win. Domestic yards can't compete with state-subsidized shipyards offering rock-bottom labour costs. If the system rewards the cheapest option, that's exactly what we're going to get. We should be proud that Canadian jobs and Canadian quality are high. That's not a detriment; it's a positive. It's something that we have worked for, together as a country, for more than 100 years, and it should encompass all the yards. I think there's an opportunity for big yards and small yards to work together if there's a national approach to building ferries.

    Let me jump in with one last question because I see I have the yellow card.

    You mentioned, Mr Warren, that only 35% of domestic steel is used. Obviously, one of the existential threats—other than the U.S. tariffs—is the dumping. China is, of course, one of the biggest, most egregious offenders in that. Maybe just elaborate a little bit more on the fact that here we have a Chinese company getting Canadian taxpayers' dollars, using Chinese steel as opposed to Canadian steel.

    Yes. It's just outrageous, especially during these....

    There's the red card.

    Voices: Oh, oh!

    Thank you very much, Mr. Warren. Perhaps another member will provide you with an opportunity to finish your response.

    Thank you very much, Mr. Muys.

    Next we'll go to Mr. Greaves.

    Mr. Greaves, the floors is your. You have five minutes, sir.

    Thank you, Mr. Chair.

    Good morning to all of the witnesses. Thank you for joining us. As a member from British Columbia—I represent Victoria—I very much appreciate the time of day that you've joined us out there, in Pacific time.

    My question is for Mr. McNeely.

    As a member of this committee who regularly rides the ferries and whose constituents rely upon BC Ferries every day, I'm wondering if you could speak to the perspective that you and your members have on the current state of ferry service in B.C. As you mentioned, it's your team that sails and maintains these ferries. Can you speak to how well ferry service levels are currently serving coastal communities in B.C.?

    The number of ferries that have been serving the coast of B.C. hasn't changed in decades, while the population has grown. That means that the capacity on those vessels has been getting more and more dramatic or full, if you want to put it that way. The system hasn't been planned for the future in the way that it probably should have been. The population increase hasn't been a surprise, and vessels get older every year. This isn't a crisis of vessel age; it's a shortfall with regard to planning. To suggest that we are now at a crisis point is only highlighting the failure of the leadership of the quasi private-public BC Ferries model. It has been more than 20 years since it has been a public-private process, and it hasn't benefited British Columbians in the way that it should. That doesn't mean that we should quickly run away from domestic production in favour of quick and cheap.

    Thank you for that answer.

    Would you then agree with the basic proposition that BC Ferries does, in fact, need to procure new vessels and expand the size of its fleet in order to maintain and improve the quality of ferry service in British Columbia?

     Yes. There needs to be investment in ferries in Canada, and that includes the west coast and BC Ferries.

    Thank you.

    Some members of this committee have called for the Canada Infrastructure Bank to reverse the loan that was offered to BC Ferries to support this procurement. This is something that has been discussed already by other witnesses, and I'm sure we'll revisit it again.

    From your perspective and from that of your members, can you speak to what impact the cancellation of the existing contract would have on your members and on BC Ferries' capacity to meet its customers' needs in the medium term?

    What I hear from my members is that we want to see public money not being sent overseas when it could help rebuild a Canadian industry. If this was really about urgency, BC Ferries would have acted when this process began in 2017.

    Our ask, again, is simple. If taxpayers are paying for it, the benefits should stay here. Good jobs, technical skills and local supply chains will deliver parts quickly and more effectively. This means that, in the long term, there will be a better service for British Columbians, and repairs on ships and ship consistency will be better over the duration. We're looking at vessels that have been running for, right now, 40 to 60 years in the water. Those are British Columbia-made vessels. If we want vessels that are going to last a long time, we would continue to build them in British Columbia and in Canada.

    Thank you for that.

    Let's talk about Canadian shipbuilding for a moment. I think everybody on this committee certainly agrees that we would like to see vessels built in Canada and Canadian public money going towards supporting the Canadian jobs that would benefit from those investments being made domestically.

    Over the last 15 years, Canada's shipbuilding strategy has sent a significant amount of business to Canadian domestic shipyards. I'm wondering if you could speak to how that federal government support for the shipbuilding industry in Canada has affected the capacity for shipbuilding in British Columbia, and how your members and those you represent may have benefited from that federal support for the Canadian domestic shipbuilding industry.

    I will try not to speak too much about shipyards, since my members don't work at them. What I will say is that when we look back over the past couple of years, when Seaspan said they had the capacity and when Davie said they had the capacity, I think that's a testament to ongoing federal investment.

    To continue with domestic production and domestic shipbuilding, there needs to be a plan in place. Continued lack of investment means the capacity is a challenge. There's a real opportunity to look at how we build ships in Canada and how to move forward in a way that works for all Canadians.

    Thank you very much, Mr. Greaves.

    Mr. Barsalou‑Duval for two and a half minutes.

    Thank you, Mr. Chair.

    Gentlemen, this summer, the committee had the opportunity to meet with Ehren Cory, chief executive officer of the Canada Infrastructure Bank, about funding it allocated for the purchase of Chinese vessels. I asked him whether he had received guidelines from the government on the importance of buying locally. He actually manages $35 billion at the Canada Infrastructure Bank, which is a lot of money. He responded that, essentially, he hadn't, that it was business as usual and that nothing had changed in the last six months.

    On the one hand, the bank didn't receive any guidelines; on the other, it didn't see the need to proactively change how it operates, despite the fact that the political planets had moved and, above all, despite the many announcements by the government according to which it intended to support local industries, particularly the steel sector, affected by U.S. tariffs.

    In your view, do you think it's normal that the government didn't issue guidelines on this, and that none of the senior officials, who are quite well paid, thought of it? I'm convinced that Mr. Cory makes a good living. Shouldn't those managing public funds and making these kinds of decisions bear some responsibility?

    My question goes to Mr. McNeely first, but Mr. Warren is welcome to respond as well if he likes.

     I'll say this, because I know we're running out of time. BC Ferries is a problem. It's a disaster, but it's been years in the making—where it's always been the cheapest source to get the goods. There's a cost to Canadian autonomy and to Canadian security, and we're seeing it now as we're getting shut out of the U.S. market and we are scrambling in a lot of our sectors.

    I'll send it over to Brother McNeely.

     Thank you.

    Frankly, I think everyone here is surprised that there wasn't a buy local or buy Canadian directive. Yes, we do think that is a leadership responsibility. We have been clearly raising the alarm about offshore builds for years. Ship procurement isn't decided by unions. It's decided by BC Ferries, its board, and the government. That's where the money comes from. They control the timeline. They need to choose where the work goes. I'm a bit stunned that there wasn't a Canadian content requirement. We're here now because the people in charge didn't act when it mattered for Canadians.

    Thank you very much, Mr. McNeely.

    Thank you, Mr. Barsalou‑Duval.

    Next, we'll go to Mr. Gunn.

     The floor is yours. You have five minutes, sir.

    Thank you, Mr. Chair.

    Mr. McNeely, do you think workers in the People's Republic of China make better workers than Canadians?

    Canadian workers, Canadian shipbuilders and mariners are some of the best in the world. I think if the ships are built in Canada, they would continue to be sailed by Canadians for decades.

    Do you think China can make higher-quality ships than we can here in Canada?

    I know that the steel we produce here in Canada is some of the highest quality in the world. I have no reason to believe that the shipyards wouldn't produce some of the highest-quality ships in the world for us to sail on and move millions of people safely on an annual basis.

    I want to ask you now the same question I asked the CEO of BC Ferries, which he struggled to answer.

    Do you think the state-owned shipyards in China follow the same level of safety, labour and environmental standards as the shipyards here in Canada do?

    I will be more succinct than the CEO of BC Ferries—no.

    To follow up on that, why do you think, at the end of the day, this contract was awarded to a state-owned shipyard in China and not one here in Canada? What was the so-called competitive advantage in your opinion that the shipyard in China had?

    The competitive advantage that shipyard has is twofold. One, they have a country that has been investing in their domestic ship capacity through a hybrid civil-military process, meaning that shipyard is funded and the work there is done at a cut rate because their government invests in it. Also, their steel is heavily subsidized. That makes it more challenging on a cost basis. In Canada, we pay a bit more for what we get. The quality we get is much higher and will last forever, and that is something we can be proud of. We're looking at billions of dollars of potential knock-on impacts to the industry in British Columbia and Canada if we build large vessels here. Now we're looking at hundreds of millions of dollars over the lifetime of the vessel just for the repair and refit. That's the scraps, not the pie.

    I know Seaspan mentioned they would have liked to build the ships here, but they couldn't compete with the state-owned shipyard in China, which, I think, were paying their workers about seven times less. Is it essentially the case, in your view, that we are offshoring these critical shipbuilding jobs to an adversarial regime because they're willing to pay their workers less and have them work in harsher conditions?

    We've been offshoring shipbuilding for decades, unfortunately, through BC Ferries and others. We could have started building smaller vessels—medium, minor and intermediates—and then built toward large vessels. Over the last 20 years, that hasn't occurred. Now we're at an inflection point where I think the decision to go with a Chinese shipbuilder has highlighted that failure of leadership and of long-term planning.

    Can you detail the main priorities that your union fights for, for your members? Is it higher wages, better working conditions, these kinds of things, over the past years and decades?

    Yes. Through the seventies until now we have been fighting for better working conditions, safe working conditions and a reasonable sense of quality of life. We're proud of the work we've done. There's still a lot of work to do. I am in bargaining later today, and that's a process that continues on an ongoing basis. However, we have progressed our membership and the people around the coast and around Canada forward in a way that we don't necessarily see in the People's Republic of China.

    What, then, is the point of having a union and achieving these results for your members if your government then simply then turns around and offshores these jobs to a country like China, which doesn't have these wages or these working conditions, and basically undercuts everything that you've been fighting so hard to achieve over the past decades and years, as you mentioned?

     I think that's the key point here. We need to push for stronger federal rules to keep public investment supporting Canadian jobs. We need to get the federal government to expand the national shipbuilding strategy to include ferries, because we need to spend Canadian tax dollars on Canadians and not offshore. Every time we offshore that money, we're not saving it; we're burning it in someone else's economy.

    I have one last question for you.

    Do you think it's fair, at a time when China's hitting our farmers and seafood harvesters with tariffs as high as 100%, that we are allowing these ships to be built in a state-owned shipyard of that very same country and then allowing them to enter this country tariff-free?

    Do I think it's fair? No.

    We're giving public money to public infrastructure, and it's leaving the country before a single welding torch is sparked.

    Thank you very much, Mr. Gunn.

     Thank you, Mr. McNeely.

    Next, we'll go to Ms. Nguyen.

    Ms. Nguyen, the floor is yours. You have five minutes, please.

    Thank you, Mr. Chair.

    Thank you very much to the witnesses for joining us this morning. I'm learning a ton about this space, and I'm really thrilled to hear from you all.

    I want to ask about looking forward because a decision has been taken by BC Ferries, and as we move forward with new policies as a new government, we have some measures that we have implemented to invest in skills building for the sector through apprenticeships and so on.

    Could you talk a bit about the proactive measures we can and should continue investing in that can support building the local capacity, the domestic capacity? As someone who's a woman, I want to see more women in trades. Are there programs...? I know we have the women in the skilled trades initiative that we've been supporting.

    Are those the kinds of things that can help strengthen and grow our domestic capacity so that we can be prepared to move forward in creating the conditions to have those jobs here?

    I'll jump in quickly.

    It's vital, especially as we bargain. We bargain a lot for investment because investment is the key to the survival of a lot of sectors, but with investment comes technology. Whether it's re-educating somebody in the current work force or there's a change in terms of other opportunities for workers to jump into new sectors, I think training is the key to this, so that we have a workforce ready to go that can jump in when a new business starts or maintain a current business with technology changes.

    Following up on that, I would concur that there's a lot of skills building they can do. My members repair the vessels, work on them and operate them. There are opportunities for the federal government to support education. There are some skilled work supports for women in trades, and trades generally. I think there's a shortfall at the federal level, where mariners who are advancing their certificates through engineering and navigational roles aren't eligible to apply for employment insurance while in school, and that's different from the trades. I think there are some opportunities there.

    Certainly with a workforce that is nearly 70% men, there are more opportunities to get more women into it. When we look at our maintenance facilities, we're looking at about 3% women in our maintenance trades facility, so there are opportunities there. Supports from the federal government would build those jobs, and if there's work to do, they can last for generations.

    Thanks very much.

    I want to ask about some of the measures that I know our government has started to introduce over the last few weeks and months.

    There's $70 million over three years to help provide some of that support, and this is going to be administered through provincial and territorial labour market.... I'm sorry. LMDA is an acronym I'm not entirely familiar with. Some of the measures and investments we are doing are about re-skilling, as well as some changes federally for new federal procurement rules that will require us to have Canadian steel used in federally funded infrastructure.

    Are these the kinds of measures that you think will help us have a more important made in Canada, buy in Canada, support Canadian approach?

    Meg, do you want to comment?

    Sure. I think it's a start.

    I don't know about the amount—$70 million. We'll have to see if that is sufficient, but I do think that these training initiatives are important, as well as ensuring that they're actually tied to larger strategies about where we want to invest and what types of jobs we want to create and not just thrown around willy-nilly without any larger plan. I think what we're seeing here is that we didn't have an industrial strategy that was sufficient on this. We didn't plan, invest and anticipate in the ways we could have.

    Even in terms of the Infrastructure Bank, we did not have conditions tied to it that were meaningful in any way to ensure that the money that comes from it actually leads to the creation of local jobs and the sourcing local materials. As we've heard from Marty and Brother McNeely today, it just points to this larger, long-term failure of any sort of strategy and coordination. The federal government really can play that role in coordinating, investing and determining where the money needs to go as part of a larger strategy.

     I really like to think about how we take lessons and move forward on what can be new policy.

    As we look forward, are there any other dimensions you want to re-emphasize that are important for us as we think about an industrial policy?

    When we're looking at industrial policy, we need to look at the whole ecosystem that occurs. It's the life cycle, whether it's building a vessel, operating a vessel or recycling vessels. There's a real shortfall in that full life-cycle thought in Canada.

    If we're going to tie federal money to any part of that cycle—or all of it, in my opinion—then we really want to ensure there's a tie-in to Canadians. We need to look at the training opportunities for that entire life cycle. That includes those who operate and maintain the vessels as well.

    Thank you very much, Ms. Nguyen.

    Thank you, Mr. McNeely, Mr. Warren and Ms. Gingrich, for joining us early this morning. We very much appreciate your testimony on this very important study our committee has embarked upon.

    I wish you a wonderful day as I suspend for five minutes, so we can welcome our next round of witnesses.

     I call the meeting back to order.

    I'd like to make a few comments for the benefit of our second round of witnesses.

    First, please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone icon to activate your microphone, and please mute yourself when you are not speaking. For those on Zoom, at the bottom of your screen you can select the appropriate channel for interpretation: floor, English or French. For those in the room, you can use the earpiece and select the desired channel. I remind you that all comments should be addressed through the chair.

    Finally, for those joining us online, I have two cards, one yellow and one red. If I hold up the yellow card, it means you have 15 seconds left in your time. If I hold up the red card, I'm not trying to be mean, but unfortunately it means I will have to cut you off to ensure the equality of time to all members.

    I'd like to now welcome our witnesses. From the BC Federation of Labour, we have Sussanne Skidmore, president, by video conference. From the British Columbia and Yukon Territory Building Construction Trades Council, we have Brynn Bourke, executive director, by video conference. Finally, from the BC Shipyard General Workers' Federation, we have George MacPherson, president, by video conference.

    I can see in the background, as some of you are next to windows, that it is very early in the morning. I want you to know that, on behalf of all members, we appreciate your being here with us this early.

    We'll start our opening remarks with Ms. Skidmore.

    The floor is yours. You have five minutes, please.

    Thank you for the invitation to speak with you all this morning, and thank you in particular for spotlighting the decision by BC Ferries to purchase its next four major vessels from a shipyard in China instead of building them right here in British Columbia.

    As you said, my name is Sussanne Skidmore, and I am the president of the British Columbia Federation of Labour. We comprise more than 80 affiliated unions, representing more than half a million workers from every part of British Columbia and literally every sector of our economy.

    As many of those workers can tell you, ferries in British Columbia are every bit as much a part of our highway system as any bridge, tunnel or stretch of asphalt. Both the southern and northern legs of the Trans-Canada Highway include ferry crossings. Ferries get goods to market and people where they need to go, from the inland ferries crossing rivers and lakes to the marine networks operated by BC Ferries serving our islands and coastal communities.

    A large chunk of our economy is literally riding on the ferries, so when we talk about “buy Canadian”, when we talk about “buy B.C.” and when we talk about nation-building projects, British Columbia's ferries should be very much on our minds.

    If “buy B.C.” is to be more than a slogan, surely it should mean that a project as significant as the next major addition to B.C.'s ferry fleet should be built in our province. Surely it should mean that the hundreds of millions of dollars that we pour into a project like that get rolled back into our local economies through wages, taxes and, of course, spinoff businesses. Surely it should mean building with Canadian steel, aluminum, copper and zinc. Surely it should mean that British Columbians and Canadians benefit from the creation of thousands of highly skilled, well-paid jobs in our shipyards. Surely it should mean our investments help to secure a robust and vibrant shipbuilding sector and the jobs it supports for generations to come. Surely, when it matters most and can have the biggest impact on our economy, “buy B.C.” should mean truly buying in B.C.

    The management at BC Ferries has instead chosen short-term cost savings over long-term benefits for our province and country. I don't see how they can square that with section 21.01(1) of the Coastal Ferry Act, which requires that BC Ferries be directed “in support of the public interest”.

    It would be hard for me to overstate just how large an opportunity is being squandered here. It goes beyond the impacts of this one project, enormous as it is, as we're in the middle of a trade war with both the United States and China. Our governments have asked the working people of British Columbia and the rest of Canada to rally together in solidarity, and working people across our country did that, whether it was in check-out lines or e-commerce shopping carts. Workers are still looking for that “made in Canada” label. They expect our governments to do the same, and it's not too late to do just that.

    We want to see a commitment to the construction of these B.C. ferries in Canada starting now. We want to ensure that everyone who sails in those four new ferries can be proud to know they came from a B.C. shipyard, where they were built by their neighbours from Canadian materials. We want to see the public interest become a mandatory core criterion for assessing major projects, binding both the federal and provincial governments. That's how you build not just ferries but a thriving industry and a strong sovereign economy.

    Thank you.

     Thank you very much.

    Next we'll go to Ms. Bourke.

    Ms. Bourke, the floor is yours. You have five minutes, please.

    Thank you, Mr. Chair and members of the committee, for inviting me to address you.

    I'm Brynn Bourke, executive director for BC Building Trades. We are a council of 20 craft construction unions representing over 45,000 construction workers across British Columbia. I’m here today to speak first and foremost for our members in the shipbuilding industry, and in particular for the people who wanted and needed this work and watched it go offshore.

    We represent over 2,500 hard-working tradespeople who earn their living building and maintaining vessels in British Columbia: 1,300 members from Marine & Shipbuilders CMAW local 506; 429 members from UA local 170; 100 members from UA local 324; 350 members from IBEW local 230; over 500 members from IBEW local 213; and over 150 members from IUOE local 115, the operating engineers.

    I want you to understand that the history of shipbuilding in British Columbia goes back over 100 years. Our members built almost every single ferry in this province before 2000. In fact, the Queen-class vessels currently being replaced with this procurement were built in British Columbia. The Queen of New Westminster and the Queen of Cowichan were built in Victoria shipyards. The Queen of Coquitlam and Queen of Alberni were built in North Vancouver. Our members took tremendous pride in building these vessels and watching them service communities along our coast for over 40 years.

    Members like Phil Venoit, now a business manager of IBEW 230, served his apprenticeship building B.C. ferries. That job earned him a lifelong career in the trades. He and thousands of others were able to qualify for mortgages with paycheques earned in those shipyards. They also used the skills they learned on those Queen-class vessels to build other major vessels, up to and including the HMCS Protecteur, the longest naval vessel ever built in Canada, launched from the Seaspan shipyard in North Vancouver last December.

    We wrote to this committee earlier this summer to communicate the capacity of B.C. shipyards to build these ferries and the willingness of B.C. shipyard workers to undertake this work. With the right procurement structure and a prioritization of Canadian content, BC Ferries could have leveraged B.C.'s world-class shipyards.

    BC Building Trades has long advocated for ferries to be built locally. In advance of this procurement, we lobbied to have a process that prioritized Canadian content and Canadian jobs. This was a once-in-a-generation opportunity to support B.C. shipyards, protect B.C. jobs and invest in our economy. Instead, BC Ferries chose to prioritize a low-bid process, making it impossible for shipyards to compete. In the end, the decision to use a foreign shipyard was the inevitable outcome of a very flawed process.

    I really want to highlight this point: Not a single measure has been put in place since this decision that would prevent this from happening again. We need a commitment to build ferries in Canada. We need a commitment to build more dry docks in British Columbia. We need a commitment to support a shipbreaking industry and invest in coastal communities to build the infrastructure to take on this work. We need a commitment to procure such materials as steel from Canadian manufacturers. We need a workforce development strategy with training dollars for our shipbuilding industry. Finally, we need the Canada Infrastructure Bank to use these values in deciding which projects to support.

    For us, this is about more than just ferries. This is about an industry that supports a local workforce that is trained and qualified to support the construction of major industrial activity in Canada. A new generation of British Columbians was ready and eager to take on this opportunity and build these ferries at home.

    I want to be clear: The jobs lost here were significant for my members and for the people of British Columbia. An economic study was conducted when BC Ferries was contemplating building seven vessels. It found that B.C.'s major vessels project would have created between 2,500 and more than 5,000 jobs in our shipyards, with another 1,000 to 2,000 indirect jobs from suppliers in British Columbia.

    This decision does not reflect our values as Canadians. It does not recognize the long-standing role B.C. workers have played in building our shipbuilding industry. It does not enable skilled trades training and apprenticeship opportunities for our youth. It does not promote economic activity on our coast or help circulate wages within our local communities. It also does nothing to bolster our national security.

    We stand ready to provide a local workforce to build these ferries in British Columbia.

    Thank you.

    Thank you very much, Ms. Bourke.

    Finally, we will go to Mr. MacPherson.

    Mr. MacPherson, the floor is yours. You have five minutes, sir.

     Thank you very much. I appreciate the opportunity to put our voices forward on this project.

    Clearly, BC Ferries has made another bad decision in going offshore.

    We've reached out to some of our shipyards to find out what their thoughts were. Canadian shipyards would not have bid on this project. The shipyards would have reviewed the procurement and looked at the likelihood of being successful. Based on their level of competitiveness, they would have declined the process because Canadian shipyards are too expensive to compete on a world market for new ship construction, especially when competing with China, Korea and other shipbuilding nations that have wages significantly lower than those of Canadian workers. They are nations that possess national incentives such as subsidies, or the shipyards are owned by the government of that country, which is the problem with China, of course, and Korea.

    The capabilities and facilities are committed to the national shipbuilding strategy. There's an insignificant market for Canadian shipbuilders to maintain large commercial shipbuilding operations unless supported by the NSS. There is a severe lack of skilled labour in Canada to build these vessels.

    I'll add that, prior to 2000, all B.C. ferries were built in British Columbia by our members, by the building trades members. The success has been incredible. When this project came online, there was talk of five vessels that they wanted to build. There was a proposal put forward by Davie shipyard in conjunction with people on the west coast. We were going to have a consortium of shipyards and shipyard workers to set up a new facility to build these vessels in Delta, on Annacis Island. We lobbied the provincial government and we lobbied BC Ferries. Clearly, there was no interest whatsoever in dealing with Canadian workers. They wanted nothing to do with the Canadian yards.

    In short, we would not be competitive in estimating for construction of these vessels. For a very expensive proposition with no guarantee of success, there was no reason for them to put forward their bids.

    The other issue we have is that when BC Ferries goes offshore—and it has done this now a number of times—when it brings the vessel back into the country, the federal government waives the duty on these vessels coming in. There's a 25% duty that protects the industry. That's what was put forward to help protect people and make sure that we keep the industry viable. Prior to the Gordon Campbell government coming in 2000, whenever BC Ferries had a project it wanted to look at, it would bring the industry together. We would all sit at the same table to decide how we were going to do it.

    A perfect example is the Spirit-class vessels that are out there. They were done by a consortium of yards on the west coast. These are still the pride of the fleet. They were built by a number of shipyards and it was a very successful project. There were supposed to be four of those; they managed to shelve two of them, so we built only two.

    Then we end up with the problem, of course, with the “fast cats”. That was a political decision, not a shipyard decision. The Campbell government decided it was going to punish everybody, so it punished the industry by setting up BC Ferries as we see it today.

    There's no self-interest in what we're doing with BC Ferries. They don't put any value in Canadian workers. They just decide that they're going for the low bid and that's the bottom line for them.

    I'll leave you with the example of the Jones Act down in the United States. There's a country that protects its industry. It looks after its workers. It goes a step further. Washington state has legislation that says the ferries that are going to operate in Washington state must be built in Washington state.

    I'll leave that with the committee.

     We'll continue to lobby BC Ferries and the provincial government to make the changes that need to happen.

    Thank you very much.

    Thank you very much, Mr. MacPherson.

    We'll begin our first round of questioning with Mr. Gunn.

    Mr. Gunn, the floor is yours. You have six minutes, sir.

    Ms. Bourke, I have a question for you.

    If you could ballpark it, on average how much would you say the average union worker you represent pays each year in taxes?

    I would say that the average wage, if you were to average it out between apprentices and journeypersons, is probably about $100,000 or $110,000, so that's about $30,000.

    Would you say that it's a good use of their hard-earned taxpayer money to subsidize shipbuilding jobs in another country, particularly in the People's Republic of China?

    I want to be clear: We're furious with this decision. I feel that we're in this position where people are saying, “Well, now the deal is done and it's inevitable, and we have to move forward.”

    As George indicated, they were working with Davie for many years to present an alternative. We were working with Seaspan for many years to present an alternative. We did not have to be in this position.

    To be before this committee and arguing that somehow there's a sense that we didn't have the capacity to build these ferries in British Columbia is very frustrating to me. I took the Spirit of Vancouver Island over on Monday to get to Victoria. These vessels are world class and still operating. Meanwhile, vessels that we're building in other countries have end-of-life that's half the age of the fleet we built here.

     It is very frustrating. They should have been built in British Columbia.

    Do you think Canadian shipyards and Canadian workers have what it takes to build these ships?

    A hundred per cent.... Again, I will repeat: We built the Queen-class vessels over 40 years ago. Almost all of them have surpassed their end-of-life service date and are still plying the waters of British Columbia, while other vessels we purchased 20 years later are experiencing failures. We are the best in the world at what we do, and our workers deserve to be compensated fairly.

    I will also say, with regard to the shipyards we're competing against, that it isn't that Canadian workers are making too much money. We are are competing against shipyards in Europe and China, where the states are sponsoring these shipyards. They're investing in these shipyards. They are subsidizing these shipyards. There's nothing extraordinarily expensive about Canadian labour. It's just that those governments believe in investing in those industries.

    You mentioned investing in the industries, which I find interesting. We have a federal government now that has talked a lot about building Canada strong and investing in the economy. Do you think subsidizing, to the tune of one billion dollars, thousands of shipbuilding jobs in China builds Canada strong?

    As I've said, I'm incredibly frustrated that we're in this position where a contract has been given to a shipyard in China to build four vessels that we could have substantially built in Canada.

    The federal government, the provincial government and BC Ferries itself have framed this as there being a spontaneous need to increase the capacity of BC Ferries. Has this decision come out of nowhere?

    We have a provincial government that's been there for eight years, a federal government that's been here for over 10 years and BC Ferries obviously should have been able to map their capacity growth. Should they have known years in advance that we were going to need new ferries and have been able to create an industrial strategy around that?

    They knew 40 years ago when we launched the Queen-class vessels when their end-of-service life was expected to be.

    I would welcome George to also weigh in, because his members are right there beside my members doing this work and are highly involved in this.

    On the same question, Mr. MacPherson, did you want to weigh in on that?

     I know that you've been calling for years for an industrial strategy to build ferries right here in British Columbia. Does it surprise you that we haven't gotten our act together here in 2025, when you've been calling for this for I believe over a decade?

    It's been well over a decade, probably two decades. We worked extremely hard with the east coast federation as well to try to put a shipbuilding strategy forward with the federal government. We lobbied hard. We fought hard. We looked like we were getting some success, and then all of a sudden things changed.

    We look at BC Ferries and, as I said before, if there was a project coming down the stream, they wanted to sit with the industry and discuss with the industry where they were going with that project and how they were going to put it together. Then everybody would just put their gloves and on and go to work and get it done. There are a lot of jobs out there that could be had. People need to put some value into the industry. The industry is, as Brynn says, well over 100 years old. We have a very long history of building ships. They're world class. They last forever. Look at the first three that were built in Germany back around 2003 or 2004. Those vessels will never see the life the ferries built in British Columbia will have. They just won't last. It's becoming clear now the problems it creates. We have vessels breaking down and we don't have parts to fix them because everything was bought in Europe. Then there's the time frame of how we go and source out those parts to get that vessel back in service. It creates a huge problem.

    I don't have the answer.... Well, I do have the answer. The answer is that we have to put this industry back together the way it was for the last 100 years.

    Thank you very much, Mr. MacPherson.

    Thank you, Mr. Gunn.

    Mr. Lauzon is next.

    Mr. Lauzon, you have six minutes.

    Thank you, Mr. Chair.

    First and foremost, I want to thank all the witnesses for joining us, particularly given how early it is for some of them.

    My first question is for Ms. Bourke or the other representatives from the workers' unions.

    In the eyes of the unions, when there is a call for tenders, how important is it to respect provincial jurisdiction, meaning reserving the right to legislate to the provinces?

    I'll go first.

    Obviously, one of the key inflection points in this decision would have been for the Province of British Columbia to instruct BC Ferries, “You will require Canadian content. You will only consider bids where there's a substantive amount of shipbuilding that's happening in British Columbia.” That is something we pushed for and wanted.

    I will also say that British Columbia does not get the same investment in ferries the east coast does. We need multiple governments to be involved in course correcting what's happening with BC Ferries.

    Do you want to add something on this, Mr. MacPherson?

    If we look at the ferries, this decision was one of the worst decisions my members have seen in their lifetime in the industry, to go to China and spend $1 billion to build four vessels. My members cannot believe it's actually happened. There's a lot of—

    I understand, Mr. MacPherson, but the question is this: Is it important to respect the jurisdiction of the province with labour?

    I think the province has some work to do. We've lobbied the provincial government very many times. Do we respect what they're doing? Sure, but they still need to look at what the industry is and how we're going to look after it.

     For the record, an independent company put out a call for tenders to obtain very specific services. Representatives of that company appeared before us to talk about timelines, manufacturing costs, but also the urgency of building these boats immediately.

    It's easy to say that it could have all been planned 40 or 50 years ago, but we've shown today that investment costs are exponential, if only to bring ferries to standard.

    The Canada Infrastructure Bank's role is to fund projects and not select them. It's important for Canada to maintain its independence from the provinces and from the funding allocated by the Canada Infrastructure Bank. As you know, there are all sorts of businesses and factories in every riding in Canada. They buy different equipment and machines that are only sold in Germany or Italy, since they aren't manufactured in Canada. That's part of the business decision-making process.

    We're all saying the same thing: Everyone would like us to buy vessels that are made in Canada. We would all like Canadian employees to be the ones manufacturing them, in Canadian shipyards. We all want the steel and aluminum being used to come from Canada.

    Earlier, we spoke with representatives of the Steelworkers Union. If we remember the reason we produce steel here but then it's processed in the United States and comes back here with a higher price and an added tax, it's because we broke the supply chain.

    We had partners outside Canada to establish a Canadian economy. Can we do better? Yes, we can do much better.

    Given this new supply chain and without losing sight of the Canada Infrastructure Bank's role in funding projects and ensuring their independence, without impinging on the responsibilities of the provinces, could you each provide a recommendation that the federal government could follow, without forgetting the elements I mentioned earlier?

    Let's start with Ms. Skidmore.

     I'll reiterate what I said earlier, which was that both the federal government and the provincial government in this scenario have a responsibility to the working people in the province, in the country, and there should be Canadian content built into any investment that's put into the infrastructure that is BC Ferries, in this case.

    There should be a Canadian tie-in. There should be benefits to Canadian workers. This benefits our economy for decades and generations to come, and everyone has a responsibility in that. To suggest that this is an autonomous decision that the provinces should make all on their own, I don't agree with that. I would assert that you folks and the federal government also have a responsibility to Canadians and Canadian workers to make sure that the investments that are made here in Canada benefit Canadians.

     You've heard from others this morning. I was on bright and early listening to both the steelworkers and the BC Ferry and Marine Workers' Union folks. There is a responsibility here and the government has a role to play.

    Can we hear from you, Ms. Bourke?

    I suppose most succinctly in terms of the role or responsibility of the Canada Infrastructure Bank, I think it should be obligated to consider the jobs that are being created and the projects that it's investing in. I think it made a wrong decision. It is a tragedy that over a billion dollars is going to a foreign country and not one job is being created here.

    Thank you very much, Mr. Lauzon.

    Mr. Barsalou‑Duval for six minutes.

    Thank you, Mr. Chair.

    I thank the three witnesses for joining us today. The testimony they have provided up to now is quite interesting. That said, I feel like I'm seeing the same problems or challenges that Quebec experienced in some areas.

    The steel sector is paying a heavy price right now, there is no denying it. It was hit with 50% tariffs by the United States, our main export market for steel. Major projects, funded by the federal government and requiring lots of steel, are happening outside the country. That's quite frustrating.

    It's not like it's the first time that has happened. We can think of the rail cars for the Réseau exprès métropolitain in Montreal, which were funded by the Canada Infrastructure Bank. The project was done overseas, even though Canada had the capacity to build the cars here. The new Via Rail Canada trains are another example. We had the production capacity to manufacture them here, but the project was ultimately done overseas. Finally, we can also think of a recent decision involving Boeing aircraft. National Defence, which had to procure new aircraft, picked Boeing rather than Bombardier by circumventing the request for proposal process.

    This Liberal government is repeating the same model. Every time public funds are invested in major projects requiring steel, and for which we have the construction expertise, it unfortunately goes elsewhere, at the expense of our workers and our industry. The same government made those decisions and also the decision to fund the construction of these boats, through the Canada Infrastructure Bank.

    In light of the government's record to date, are you feeling confident about the future?

    Ms. Bourke, do you want to start?

     It's certainly frustrating. We're pushing back against this narrative that we did not have the capacity to do this. We've spoken already about the fact that we have built every ferry in this province for nearly 100 years, until 2000. Then choices were made, both by successive provincial governments and by federal governments, to walk away from the civilian shipbuilding industry. Nevertheless, as I mentioned in my opening comments, we built the HMCS Protecteur, which is the longest naval vessel in Canada's history. We're building very substantive projects in British Columbia. The idea that we couldn't build these ferries tomorrow is highly offensive to my members, who are doing much more sophisticated things in the shipyards.

    Are we here because we had a problem with timing? Yes. Are we here because we have a BC Ferries corporation that prioritizes low bids and that basically told Canadian shipyards that was the criteria? They knew not that they didn't have a good chance and that they would not win if they bid on these projects. I'm here not only to bring the frustration and anger of my members and talk about this but also to say to the federal government, the provincial government and BC Ferries that they haven't changed a single thing since this happened to make this not happen again. We will be here over and over again. If we want to save our civilian shipbuilding industry, it starts today by evaluating this decision and trying to right the course.

    I appreciate your comments on the importance of building confidence by taking actions to promote change.

    I mentioned the government's record, but I could tell you about our current study. Ms. Freeland, when she was transport minister, wrote a letter in which she stated that not a single federal dollar would go toward this project. Ultimately, she was fully aware that the Canada Infrastructure Bank had a plan to fund vessels built in China.

    The Liberal government's transport minister acted in full knowledge of the fact and with full knowledge of the situation. Ultimately her letter was worthless and was just for show. In short, she fooled everyone. Do you believe this constituted a breach of trust on her part?

    Ms. Skidmore, do you want to respond?

     I get that there are some highly political conversations going on around this, but my responsibility is to the working people here in British Columbia. We had the ability to build the ships, as you've heard over and over again. We have the workforce to build the ships, and we're ready to do it. Regardless of who's in government, the commitment going forward as of now needs to be made. Changes need to be put in place to ensure that British Columbian workers are building things that are used here in British Columbia.

    Right now we're talking about ferries, but of course there are other things to come. We need an industrial plan that ensures that our shipbuilding industry not only continues its successes of the last hundred years but becomes even better. There's an opportunity here for the federal government and provincial governments all across the country to make sure that we spend Canadian dollars building Canadian products that will benefit us for generations. It's not only that but the outpouring of the other things that come from that, including skilled trades.

    I heard earlier this morning talk about investing in women in trades and investing in skilled trades and training. Who better to do that than union folks and public post-secondary education?

    There's a real opportunity here. It's been missed. It's unfortunate, as you've heard from the building trades. We are very frustrated about this. We'll continue to try to make sure this gets done right going forward.

    Thank you, Mr. Barsalou‑Duval.

    We'll go to Mr. Albas to begin our second round of questioning.

    Mr. Albas, the floor is yours. You have five minutes, sir.

    Thank you, Mr. Chair.

    Thank you to all of the witnesses for coming today.

    We heard from our earlier witnesses that this is a generational investment. Davie shipyards called this RFP by BC Ferries the largest non-governmental procurement in Canada's history. We've also heard from Eric McNeely that in China, the PRC has a hybrid model where they subsidize both their civilian and their military, because it keeps that work coming. I and Conservatives recognize that it is the workers who are going to be bearing the costs of this, both in terms of their tax dollars and as a missed opportunity.

    I want to start first with Ms. Bourke.

    Ms. Bourke, you've pointed out the outrageous decision by the Canada Infrastructure Bank to not even blink when BC Ferries came to them and asked them for a below-market loan for over a billion dollars, and there was no Canadian content requirement. Do you believe the Canada Infrastructure Bank has lost its way?

    First, I want to talk about that piece around civilian and national defence in shipbuilding. I will say that there's a saying in our industry that our shipbuilding sector is a three-legged stool. It is national defence, private industry with cruise and fishing vessels, and civilian shipbuilding. Those are the three pieces of work that keep us moving and allow for skills training and growth and that make for a vibrant industry. When you have one of those legs taken away, in this case, civilian shipbuilding, it really causes a paralysis in the industry.

    On the Canada Infrastructure Bank, I've made it clear that I think their decision is not in alignment with Canadian values. I think they should be required to place a lens on the decisions they make in terms of whether they create jobs, create opportunities and benefit Canadian communities.

    I will say that it is incredibly frustrating as a British Columbian, who needs significant investment in our ferry fleet, to be in a position where we may be questioning whether there's federal support. I do reject this black and white in that either the loan is cancelled or it's not cancelled. We need federal support for ferry construction in British Columbia. I hope I'm articulating that well. We need these dollars to flow to the west coast.

    You absolutely are. I sense the palpable anger coming from workers who believe that they have the know-how, if government, like other governments, saw the value in doing it here.

    Both David Eby and Mark Carney wrapped themselves in the maple leaf and said they wanted to build Canada strong, to buy Canadian and move faster than we ever have before. One of the things that I know is frustrating to your members is that Seaspan funded economic studies and presented them to BC Ferries in 2023. I believe it's called the Shirocca report. It was done by a consulting group.

     BC Ferries has failed to produce those documents—which this particular committee has—which I believe gave an argument for doing it here in Canada. It was an alternative vision. Do you believe that BC Ferries should come clean and submit that evidence so we can have a full conversation about the economic benefits of seeing these ships done in Canada?

     As an organization of many unions that were lobbying to have this work come to British Columbia, we were aware of the Shirocca study. A lot of the economic benefit analysis in terms of job creation and how taxes would flow back into the communities—all of that—came from that report, and we've read it. I was surprised that it wasn't disclosed.

    [Technical difficulty—Editor] to the committee so that we can really get to the heart of this matter and present a full recommendation to the Government of Canada?

    I'm sorry; the very first part of your question was cut off. Do you mind repeating it?

    Okay.

    Do you believe that BC Ferries has an obligation to this committee and to the public to submit those documents?

    I believe it's in the public's interest for that report to be made public.

    Thank you very much.

    Now, the Pattullo Bridge and—closer to Mr. Greaves—the Johnson Street Bridge both had considerable delays because of cheap Chinese steel.

    Ms. Skidmore or Ms. Bourke, are there concerns of the same kind of thing happening here?

    Provide a 10-second response, please.

    Yes, we have concerns. My members are literally building the new Pattullo Bridge and have experienced significant challenges with the quality of the steel.

    Thank you very much, Ms. Bourke.

    Thank you very much, Mr. Albas.

    Next, we'll go to Mr. Greaves.

    Mr. Greaves, the floor is yours. You have five minutes, sir.

    Thank you, Mr. Chair.

    Thank you to all of our witnesses for joining us this morning.

    As the member of Parliament for Victoria, I would like to extend my appreciation to you, Ms. Skidmore and Ms. Bourke, for your opening comments, which emphasized the important role that BC Ferries plays in providing critical infrastructure to B.C. coastal communities. You also emphasized that the interest all of us on this committee really should be in prioritizing how we can ensure BC Ferries has the capacity to meet the needs of British Columbians while doing everything possible to support Canadian jobs and Canadian industry through its procurement processes.

    I also note and appreciate the statement that was just made about how critical federal government support is to sustaining Canada's shipbuilding industry. I'd like to ask you to elaborate on that part with respect to the national shipbuilding strategy. Now in its 15th year, this strategy has been integral to channelling federal government support towards shipbuilding across this country.

    Could we please hear you speak to how the national shipbuilding strategy has supported job creation and the shipbuilding sector in British Columbia? Perhaps we could start with Mr. MacPherson, but I'd love to hear from all three witnesses.

    The shipbuilding strategy has really brought part of the industry back to a very good level. We have a lot of apprentices who have gone through. They have a career in front of them and they're going to do extremely well.

     We just need to expand on it. It's been good for Vancouver. It's been good for Halifax. I think it's really done extremely well for the industry across the country, so we just need to expand on that. We need to make sure that when the federal government is going to invest in the industry, it's looking at Canadian jobs. It needs to see it's putting people to work.

    A lot of young people out there are struggling today to find a career path, and this is a great career path. People are able to buy their homes, pay their mortgages and buy their cars. It's a great job, but for the federal government to finance projects like BC Ferries' project to China with absolutely no Canadian content whatsoever is just wrong. My members were devastated when the announcement came out that they were going to build four ferries in China, but they were extremely devastated when they found out—because nobody knew—that the federal government was actually loaning the money to BC Ferries to build in China.

    There is a lot of criticism going toward both levels of government for how this project went. This project was in the can for seven years. That's when it started, and at no time did BC Ferries come to the industry and ask what the industry could do. The only thing they said to the industry all the way through was that this project would be done on price and price alone, and that there was no value in Canadian workers. That's basically what they said to us, so we're extremely frustrated with the whole process.

     Perhaps Ms. Bourke....

    I'll weigh in and say two things.

     First, the national shipbuilding strategy has created many jobs for my members, and they're very proud of the work they're doing on those projects.

     I will also say that when I use that example of the three-legged stool.... Our shipbuilding industry is more than just the North Vancouver Seaspan shipyards. It's the Victoria shipyards. It's the Esquimalt dry docks. It's Point Hope. It's Allied Shipbuilders. What we need is an ecosystem where we have that civilian shipbuilding also happening so that different components are being built. We're spreading that work around so that you have work for apprentices as well journeypersons.

    Right now, we're completely off balance. We have a big push on federal national defence and then nothing. Then we have another big push and then nothing. We really need to bring the whole ecosystem back into alignment.

    Ms. Skidmore, I'll pass the floor over to you if you any comment on that question as well.

    I would just echo what both speakers before me have said. This is a priority here. We heard immediately from workers when we heard that the contract for these ships was going offshore, over to China.

     Workers here, in the province of British Columbia and across the country, are ready to do the work. They're hungry for the work. As we are looking to the future and the commitment—the federal government's commitment, the provincial government's commitment and BC Ferries' commitment—to our working people and our economy here in British Columbia, we see that this investment needs to be made, and there need to be ties to it.

    Thank you very much, Mr. Greaves.

    Mr. Barsalou‑Duval for two and a half minutes.

    Thank you, Mr. Chair.

    Earlier, I asked the witnesses in the previous panel if they agreed that all major infrastructure projects funded with public funds should be carried out here. I think it makes perfect sense, and both previous witnesses agreed. I'd like to know whether our three witnesses also agree.

    Ms. Bourke, what are your thoughts?

    Yes.

    Mr. MacPherson, do you agree?

    Yes, I totally agree. I think that if we're using taxpayers' money to fund projects, surely to God we're going to put people to work.

    Ms. Skidmore, do you agree?

    Yes.

    I'd like to ask one last question.

    Mr. MacPherson, you talked about the Jones Act in the United States. If I'm not mistaken, under this act, all boats transiting through American ports must be built in the United States.

    Are you officially asking for this kind of policy to be implemented here? If so, how should we go about it?

    I absolutely do. I absolutely believe that we need a Jones Act in Canada. As we lobbied government back through the nineties, we said that this was what was required for Canada.

     We have to stop building vessels offshore. We have to put value into people's lives and put them to work, and that's one of the ways we can do it. It's a good industry. We're over 100 years in the industry in British Columbia, and we'll be another hundred years. We'll struggle all the way through unless we get government on side to work with us and put all this package together.

    Given that the shipyards seem very busy right now, if we adopt that kind of policy across the board, I presume that the shipyards might need some time to adapt and gradually increase their production capacity. I imagine that we can consider such a strategy.

    Could you send us your suggestions in writing, Mr. MacPherson?

    Yes, we could certainly do that.

    Thank you very much, Mr. Barsalou‑Duval.

     Just building on what the member said, if there is anything else you'd like to add to your testimony today or if there are any recommendations you'd like to share with the committee, by all means, do get those to us as soon as possible. We'll try to include those in our analysis.

    With that, on behalf of all members, I want to thank you once again for waking up early. The sun wasn't up when you started, and now it's shining, as I can see through your windows there.

    I wish you a wonderful rest of your day, and thank you again for contributing to this very important study.

    With that, colleagues, the meeting is adjourned.