Yes. Thank you very much, Mr. Chair, members of the committee.
I'm glad to come back here to talk about the supplementary estimates for Transport Canada. I want to remind members of this committee how important transportation is, of course, to the GDP, as 40% of our economy is linked to trade. Much of it is in merchandise that's transported by truck, train, ship, and plane between Canada and the United States and around the globe.
Obviously one of the big challenges that we have had as a government in the last few years is to reinvest in infrastructure so that we can enhance safety, security, and economic viability of the transportation system. The federal government recognizes this, and it has invested appropriately in all modes.
You know that we invested $600 million in the strategic highway infrastructure program in budget 2000, and $500 million of this is going to go to improvements in the national highway system. Another $100 million is available for system integration initiatives such as border-crossing transportation and deployment of intelligent transportation systems.
In addition, the government announced a total of $4.6 billion in the Canada strategic infrastructure fund and the border infrastructure fund. Of the $2.8 billion in projects announced to date, 79% has been allocated to roads and highways, border transportation projects, and public transit.
Perhaps germane to recent discussions in the press, the air industry has also benefited from financial support from the Government of Canada. We provided assistance to the industry, including $100 million in compensation for the loss of business resulting from the closing of Canada's airspace after September 11, 2001, and $35 million to assist air carriers in meeting requirements for reinforced cockpit doors.
In addition, as you know, this committee is particularly aware that we've set up CATSA, the Canadian Air Transportation Security Authority. That alone saved the airlines directly more than $70 million a year, and it continues to make annual contributions towards aviation security-related policing at airports.
One thing that is not appreciated is that since 9/11/2001, the Government of Canada has assumed the liability on war risk insurance for the air navigation system, for the airlines and for the airports. This is almost an incalculable saving, because we don't know what they would have had to pay. In fact, the insurance wasn't available post-9/11. This is something we're grappling with, but other countries around the world are also grappling with it and we're trying to have a global solution to that.
Obviously we continue to monitor the health of the air industry, and we continue to be very concerned about that. I'm sure you'll have questions on that.
That is assistance to the air industry.
Now, the marine sector has been targeted for strategic investment, and one of the things I'm very concerned about right now is maritime security. We have one of the safest, most secure transportation systems in the world. We worked hard at it, and we'll continue to take the required steps to keep Canada at the forefront. You'll remember that we announced $172.5 million for marine security improvements earlier this year, and it included initiatives that improve the security at sea and on land, particularly in our ports.
Passenger rail in Canada continues to benefit from the funding of $401.9 million announced by the government in April 2000 for VIA Rail. That announcement allowed VIA Rail to face its most urgent capital needs relating to rolling stock, infrastructure, and health and safety.
Obviously, the government recognizes the importance of transportation to ensure the prosperity and quality of life of all Canadians.
Before I respond to your questions, I'd like to set the stage by talking about the supplementary estimates, and I'd like to provide an explanation as to why this money is needed.
First of all, many of the items included in the supplementary estimates were included in previous budgets. As one example, you'll recall that three of the items included in the February budget of this year were extending the port divestiture fund, providing critical funding to Marine Atlantic, and providing operating funds for the old port of Montreal.
The items contributing funds to the Toronto Waterfront Revitalization Corporation and the air-rail link are projects announced under the umbrella of the Toronto waterfront revitalization initiative announced by the Prime Minister, the Premier of Ontario, and the Mayor of Toronto in October 2000, when each level of government committed $500 million to the project. The funding was highlighted in the December 2001 budget.
This year the budget plan 2003 was announced on February 18, and the main estimates were tabled in Parliament on February 26. This tight timing made it impossible to seek parliamentary approval for certain items as part of the main estimates process to access the funds we are seeking today in the supplementary estimates.
However, we still have to get parliamentary approval to get access to the funds requested, and that is why I am here today.
The $178,492,040 that has been requested will be used in many different areas.
Transport Canada is responsible for several Crown corporations that are accountable to Parliament through the Minister of Transport. Some of them have requested additional funds to the Department.
For example, one of the single largest sums in the supplementary estimates will go to Ridley Terminals Inc. to reimburse its credit facilities on or before the due date of February 10, 2004.
Ridley Terminals is located on a 55-hectare site on the northern end of Ridley Island in Prince Rupert. It's a sophisticated bulk-handling facility used for storing and moving coal from unit trains into ships.
In recent times Ridley Terminals Incorporated has faced some significant financial challenges. Some $77 million of the supplement is needed for the repayment of outstanding loans for the facility, and the government is the guarantor of these loans and is therefore responsible for the repayment.
In 2001-02, Transport Canada received unsolicited expressions of interest in Ridley Terminals and subsequently an RFP was issued to assist in the evaluation of options for this facility to determine the best course of action to deal with the challenges facing Ridley.
That process is not over yet.
Another crown corporation, Marine Atlantic Inc., will require an additional $16.5 million, due to a shortfall in traffic levels, higher fuel costs, and increased costs associated with vessel maintenance, workers compensation, insurance premiums, and pension plan contributions. The company has undertaken extensive internal resource reallocation, but it's unable to address this shortfall.
Marine Atlantic, as you know, provides a constitutionally guaranteed transportation link in Atlantic Canada by operating three passenger ferries between North Sydney in Nova Scotia and Port aux Basques in Newfoundland and Labrador...and Argentia in the summer.
Treasury Board has approved the 2003-2004 Business Plan for the Old Port of Montreal, another Crown corporation. However, that plan was provided too late and the funds could not be included in the Main Estimates. That is why we had to add $18.4 million to the Estimates to cover the operating costs of that Crown corporation.
Additional funds in the amount of $81,100,000 are required to extend the residential rehabilitation assistance program operated by Canada Mortgage and Housing Corporation, which is one of our largest crown corporations. The extension of this program was announced in budget 2003 and funding will be used to help preserve the existing stock of affordable housing.
I should say that Karen Kinsley, the new president of CMHC, is also in the room and she would be available for answering questions.
Another project that requires funding is the Toronto waterfront revitalization initiative. As I said, it is a partnership between the Government of Ontario and the City of Toronto. And the $500 million initiative is referenced in the December 10, 2001, budget plan tabled in Parliament.
The two amounts requested, $21.4 million and $20 million, are part of a $500 million federal commitment for the redevelopment of an area along the southern border of Toronto. The funding is going to be used for expansion improvements of public transit facilities at Union Station, for an environmental assessment of design work to transform the mouth of the Don River, for improvements to former industrial and port lands in the West Donlands area, and for the extension of Front Street from Bathurst to Dufferin Street. It's part of a previously announced $1.5 billion, multi-year project for the redevelopment of Toronto.
The Port Divestiture Program is related to the divestiture of Canadian ports to local parties. In some cases, the ports are divested as operating entities but, in other cases, when the facilities are not viable anymore, the lands and facilities are divested to parties wanting to put them to other uses. The Port Divestiture Fund has been created to facilitate this process.
So far, 450 Canadians ports have been divested under this program. Ninety-nine regional or local ports have still not been divested.
The government's recently announced three-year extension of the port divestiture program is in accordance with the national marine policy, and therefore an additional $25 million is being sought for the current fiscal year to continue divesting the remaining ports.
We also need to maintain our safety programs, such as the grade crossing closure program. As you know, this program empowers the Minister of Transport to enter into an agreement to close crossings in the interests of safe railway operations.
Similarly, parliamentary approval is required for a grant to the International Civil Aviation Organization for the universal security audit, in the amount of $42,000. We think this audit is a very important program and it's part of a larger program of an internationally recognized means of verifying the implementation of ICAO aviation standards worldwide. We made a $350,000 grant to the program in February 2002, and the additional funds requested represent the balance of Canada's commitment.
Both of these grant programs are being funded from existing Transport Canada reference levels, but they are required to be listed in the estimates, an undertaking that was not completed in time for the main estimates.
More and more, transportation is at the heart of our economic well-being.
Each year, the transportation system ships more than $1 trillion worth of goods across the country and employs more than 850,000 people.
As you know, our role has changed dramatically over the past ten years. And while Transport Canada no longer owns and operates a large part of the transportation system, it continues to play an important role in the strategic support of certain transportation infrastructure, oversight and regulation of the industry and the safety and security of important transportation infrastructure and its users and transportation policy. The expenditure of these funds through the supplementary estimates process will help us continue to fulfill the responsibilities.