TRAN Committee Meeting

STANDING COMMITTEE ON TRANSPORT

LE COMITÉ PERMANENT DES TRANSPORTS

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, April 29, 1998

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[English]

The Vice-Chairman (Mr. Roy Cullen (Etobicoke North, Lib.): Could we call the meeting to order, please.

Good afternoon, ladies and gentlemen. This is meeting 22 of the Standing Committee on Transport. We're here today to continue our review of the passenger rail services in Canada, and ways in which we can revitalize, re-energize and make viable passenger rail services in Canada.

We know how important the rail system is to municipalities in Canada. It connects cities, there are commuter trains, and there is a whole host of other impacts on Canadian municipalities.

So we're delighted today to have with us the Federation of Canadian Municipalities.

I'd also like to welcome some young people from the Forum for Young Canadians who are joining us today. They're here in Ottawa from all over Canada to participate in and witness our political process in Ottawa. So I welcome them.

I gather Mr. Knight is not present here today. Who will be leading the discussion on your side? Is it Mayor—

Mr. Bill Comaskey (Mayor of Thompson, Manitoba): Bill Comaskey.

The Vice-Chairman (Mr. Roy Cullen): Mr. Comaskey, may I ask you to introduce your colleagues. Then the way we normally work is that if you could present for 10 to 15 minutes, we'll open the floor for questions and comments from the members of the committee. Thank you. Please proceed.

Mr. Bill Comaskey: Thank you, Mr. Chairman. I'm pleased to be here today to speak to you on behalf of the Federation of Canadian Municipalities. With me today are Fiona Dellar, a policy analyst with the FCM, and Daniel McGregor, a senior policy analyst with the FCM.

I'd like to recognize and thank our member of Parliament from the Churchill constituency, Bev Desjarlais, for being here. Bev, we meet many times.

Ms. Bev Desjarlais (Churchill, NDP): I didn't know he was were going to be here today.

Mr. Bill Comaskey: I didn't know you were going to be here either.

An hon. member: Only once.

Some hon. members: Oh, oh!

Mr. Bill Comaskey: So I do also bring you greetings on behalf of the City of Thompson.

Mr. Stan Keyes (Hamilton West, Lib.): She's rarely there, is she?

Mr. Bill Comaskey: She's there a lot.

Mr. Stan Keyes: Oh, I see.

Mr. Bill Comaskey: She's there quite a bit.

Ms. Bev Desjarlais: At the grocery store.

Mr. Bill Comaskey: Yes, we meet every day on the street when she's in her constituency.

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Thank you, Mr. Chairman, for the opportunity to speak to you on the future of passenger rail in Canada, on behalf of the Federation of Canadian Municipalities, which is FCM.

FCM has been recognized since 1937 as the national voice of municipal governments. It represents the interests of municipalities on policy program matters within federal jurisdiction. Municipal governments constituting FCM's membership represent more than 20 million Canadians. Members include Canada's largest cities, small urban and rural communities, and the 17 major provincial and territorial associations. Almost all municipalities that lost VIA Rail service in the 1990s are members of FCM.

FCM has always supported the provision of a cost-effective passenger rail service from coast to coast. In a country as vast and as sparsely populated as Canada, an efficient, accessible and affordable transportation system is the necessary link between communities. It helps forge a sense of national identity, which is essential to our continued political existence.

In this context transportation is more than simply the movement of goods and passengers. It is the glue that holds us together. If we were to have a truly national passenger rail service, a reasonable and reliable service should exist from coast to coast. This is particularly important at a time when smaller communities are having to manage and accommodate the offloading of federal ports and airports.

Larger cities are having their airports and ports turned over to local authorities. As this committee is aware, these transactions are not running as smoothly as predicted, particularly for some marginal communities handling Canada port authorities and national airport system airports.

As part of its national transportation policy, the federal government must consider the effects of communities of offloading, divesting, abandoning or decreasing all modes of transportation simultaneously. We believe this message would have been heard consistently if cross-Canada hearings had been held as we had suggested.

CN president and CEO, Paul Tellier, urged you not to look at VIA in isolation but to factor in other transportation realities. This is an excellent suggestion. Any changes to the passenger rail network in Canada are changes that occur within the context of a national transportation system in flux and, in some instances, in disorder. This disorder is felt keenly by communities that are finding it more and more difficult to rely on VIA Rail services as a means of passenger transportation at a time when passenger transportation as a whole is in turmoil.

For instance, although they retain their passenger rail service on the CN line, northern Manitobans have been faced over the last decade with growing unreliability and reduced quality of service.

Although there is a regular timetable for trains in northern Manitoba, VIA is seldom able to keep to it. Trains can be as late as one to twelve hours and, on occasion, are completely cancelled. This has left local merchants, residents, tourists and travel agents upset and frustrated.

Another problem is the loss of local VIA agents along the northern lines, meaning that communities have had to rely on the services of agents four provinces away. These agents seldom have any knowledge of northern Manitoba and they have little interest in finding out where a train might be or when it may be arriving at its destination.

Finally, a common complaint heard is that VIA staff are often rude and unhelpful to train passengers. This adds to the discomfort of passenger rail and drives off customers, many of whom are tourists.

One local travel agent has informed me that she continually has requests for larger parties to rent an entire car. VIA invariably says no to these requests, even when the potential customer is willing to pay a premium price for the ability to keep their party together for a trip to Churchill, Manitoba.

Another local resident tells me she has encountered many difficulties with the passenger rail service. On numerous occasions reservations have been cancelled by VIA, leaving people hanging. However, when she went down to the station to speak to officials, she was told there were many seats still available. One has to wonder why cancellations occur when there are seats available.

She also recalls stories of American tourists who have made States-side reservations, only to find upon their arrival in Thompson that their reservations were cancelled.

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It is also quite common for tourists to be forced to ride in the baggage car, as the train is often oversold.

The rail link has become one of Canada's most treasured tourist commodities, and to deny tourists suitable accommodations is a great disservice to all tourists, tourism operators and the reputation of Canada as a preferred tourist destination.

Another consideration is the effect of freight rail abandonment on passenger rail. We have not yet fully seen the effects of CN and CP rail abandonment on VIA, which is dependent upon these tracks for passenger rail operations, but it can only be a matter of time. We ask the committee to keep the impacts of CN and CP rail line abandonment in mind when considering the future of VIA.

The 1992 Royal Commission on National Passenger Transportation concluded that passenger automobile transportation benefits from $3.4 billion annually in public subsidies. Continuing federal budget cuts to VIA Rail will decrease passenger rail subsidies to approximately $170 million per year by 1999. It is clear from these figures that all modes of transportation are not operating on a level playing field. Passenger rail has been undermined by continued government financing of automobile travel through the funding of highway maintenance and upgrade.

FCM believes that all three levels of government must cooperate and come to an agreement on the mix of passenger transport services for Canada so that one mode of transportation is not continually undermining the viability of another.

In a speech to this committee in February, the Minister of Transport asked whether we need a national passenger rail service. From municipalities across the country the answer is yes, we are very much in need of a national passenger rail service. It is not simply a matter of sentiment or nostalgia. Passenger rail connects communities and connects Canadians.

When we speak of a national passenger rail service we are referring not only to service in heavily populated areas—for instance, the Quebec-Windsor corridor—or major tourist routes such as between Vancouver and Calgary; we are also speaking of a service that connects small and remote communities as well as large urban communities. Many of these smaller and more remote communities have already felt the effects of cuts to VIA Rail funding and it is imperative they should not be subjected to a further erosion of passenger rail service.

For many Canadians, particularly those in western and Atlantic provinces, previous VIA cuts have strengthened the feelings of isolation and alienation vis-à-vis central Canada, which is perceived as more and more arrogant and unresponsive.

FCM commends VIA Rail's decision of finding new and innovative ways of making VIA a cost-efficient enterprise. For instance, high-price tourist routes and cross-border services should complement rather than replace the national rail service. Reliable and accessible passenger rail service must be provided to Canadian communities from coast to coast. Rail is the most energy-efficient and environmentally friendly mode of intercity transportation.

The government must acknowledge its responsibility as the guardian of national passenger rail service. It should be remembered that the government created VIA Rail and therefore is accountable for its operations. The Minister of Transport has asked you to think creatively about solutions to the problems facing passenger rail in the country. You cannot depend entirely upon outside interests to provide the solutions; it is neither realistic nor responsible.

Any review of the future of passenger rail must include honest and open environmental and economic assessments. It must take into account the impact policy decisions have on other modes of transportation and on all three orders of government.

The importance of this cannot be overstated, especially at a time when Canada has committed to decreasing greenhouse gas emissions by 6% from 1990 levels to the year 2012. A decrease in rail service means an increase in car transportation and therefore an increase in traffic congestion, greenhouse gas emissions and an increase on the wear and tear of our already crowded and crumbling municipal and provincial roadways. If transportation policy is to evolve along environmentally sound principles, as the Minister of Transport has so often claimed it should, then environmental assessments must not be an afterthought. They must be an integral part of transportation policy.

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Just as there are measurable environment costs and benefits to all transportation policy options, there are measurable economic costs and benefits as well. A revitalized rail service should not only improve contact and access between Canadians and communities; it would also provide employment and economic development opportunities due to increased travel and tourism.

Canadians faced with a decrease or abandonment of passenger rail service to their communities will, out of necessity, turn to other forms of passenger transportation: buses, cars and air travel for the most part. These modes of transportation are harsher on the environment, and in the case of buses and cars, they are less safe than rail travel and have large hidden costs for provincial and municipal governments that have not been taken into account.

Cuts to passenger rail service may reduce direct federal costs, but expenses to provincial and municipal governments in the shape of road maintenance and upgrading will increase. It costs the provinces and municipalities billions to maintain and build highways to accommodate the increased traffic and wear and tear that heavy vehicles, including buses, cause.

Related to the issue of interdependence of different modes of transportation is multimodal integration. Passenger rail service cannot be considered in isolation from its effects on other modes of passenger transportation. The FCM believes that it is necessary to look at all transportation policy in Canada as an integrated whole. Intermodal integration is necessary to foster economic and service efficiencies.

It should be possible for the traveller to move easily from passenger rail to another mode of transportation. Excellent examples of intermodal service integration can be found throughout Europe, where in many instances ticketing and baggage handling have been integrated between the air and rail modes.

Integration between intercity and public transit systems is also critical to the efficiency of the whole. All intercity travel ends in local jurisdictions, and the ability to complete any trip is very much dependent on some form of local passenger transportation.

Rapid rail transportation from airports to the downtown core should exist in major urban centres. At both Dorval and Pearson airports, for example, existing rail lines are literally within sight of air terminals. At Halifax Airport the line is within two kilometres of the terminal.

The same principle applies to the linking of rail and bus modes. Bus operators must be encouraged to work with the rail system, not against it, by providing intermodal stations.

While we recognize that the primary responsibility for public transit must rest with provinces and municipalities, the need for passenger transportation integration clearly suggests enhanced federal participation. The FCM supports a legislative mandate for VIA that would allow it the flexibility to borrow money, find private investors, and build on its existing structure.

The FCM cautions, however, against the full privatization of VIA. Full privatization of the corporation would certainly mean that much of the current network of passenger rail would be abandoned as not economically viable. In a privatized system profit comes before public interest, and Canada would end up with a system of rail lines that services heavily populated areas exclusively.

This is not a national rail service. We all know that no national passenger rail service in the world is entirely self-financing.

The FCM calls upon this committee to recommend legislation to provide VIA Rail with a clear operating mandate and the ability to carry out that mandate.

The legislation should also make provisions for an interdependent board of directors and management, a set of clearly attainable fiscal performance goals, and a guarantee of an equitable and adequate level of passenger rail service across the country.

It has been suggested by VIA that a favourable option would be to give VIA the status of a commercial crown corporation. This would allow VIA to operate as a business with the ability to access financial markets effectively, and to partner with private interests. The FCM is in favour of this option as long as it doesn't blur the ultimate responsibility of the federal government to ensure that a national passenger rail service is secured for today and the future.

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Even without further cuts to VIA, a decrease in the quality of service is inevitable without the means to purchase new equipment. VIA's equipment has been inadequate for far too long. While there have been overhauls and updates, the aged equipment VIA is currently using on some routes is expensive to maintain and subject to random failure. Only complete reconstruction, or preferably replacement, will make passenger rail work in Canada. VIA can no longer operate an efficient and desirable service with the equipment it now has than could Air Canada with a fleet of DC-3s.

VIA Rail must be given the means and flexibility to find the capital it needs to update its equipment so that it may provide an adequate standard of service to Canadians and attract the ridership it needs. The FCM believes that an efficient, safe and high-standard passenger rail service will be successful.

High-speed rail is an excellent example of the importance of new equipment for a revitalization of passenger rail in Canada. The FCM has long supported high-speed rail as the cornerstone of a rejuvenated national passenger network. High-speed rail in the Quebec-Windsor corridor, and possibly elsewhere in the country, would increase customer satisfaction and ridership, improve public safety, and decrease highway congestion and air pollution. Profitable high-speed rail could support the passenger rail network in the rest of the country.

There comes a time when the government has to make a commitment to long-term operation and viability of a national rail service. For many years the government has been acting in a discretionary, ad hoc manner towards VIA Rail, and it's time to make a change.

We are asking not for a light commitment, but a well thought-out strategy for VIA Rail that spells out the role of the government vis-à-vis the corporation. We believe that this plan should identify a national rail system that services the entire country, and include a legislated mandate for VIA as well as a commitment from government to a constant level of funding that is stable and reliable over a certain number of years.

In conclusion, to achieve a revitalized passenger rail system in Canada VIA must access to capital funds. The government can do its part by committing to a constant level of funding over the long term.

Transportation must be considered as an area for reinvestment of the coming budget surpluses. Ensuring the future of passenger rail should be high on this list.

Thank you.

The Vice-Chairman (Mr. Roy Cullen): Thank you very much, Mr. Comaskey.

In your presentation you mentioned cross-Canada hearings. I'd just like to comment that it is the intention and plan of this committee to consult with Canadians more broadly once we have identified some options, and once we've had some feedback from the government with respect to certain options.

I'm not sure if that's what you're referring to, but I would just like to make that comment.

Now we'll turn to questions. Mr. Morrison.

Mr. Lee Morrison (Cypress Hills—Grasslands, Ref.): Thank you, Mr. Chairman, and welcome, Mr. Comaskey.

I want to ask one rather general question. Then since you are from Thompson, I would like to ask some technical specifics about the Bay line.

First, I will turn to the general question. You do mention in your presentation that you propose that VIA could find private investors to cooperate with them. I just wonder how you would propose that anyone could be convinced to invest in VIA.

Alternatively, are you perhaps proposing the British system, where they have a multitude of small, privately owned rail lines? All of them are being heavily subsidized by the government. So in effect, instead of subsidizing the crown, all they're doing now is subsidizing private interests. What exactly are you getting at?

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Mr. Bill Comaskey: I believe a study was done in 1995, and I'll use the Quebec-Windsor corridor as an example. Bombardier has expressed an interest and has been involved in that.

We believe there has to be a system that's cross-subsidized. Some of the more remote, sparsely populated areas will have to benefit from some of the more lucrative markets. If that is considered and accomplished, then private investors certainly will want to have a return on their investment, but we believe that can work.

Government cannot distance itself from it. There is no system we know of that's fully cost-effective.

Mr. Lee Morrison: On my specifics, again, since you are from Thompson you may well gather the Bay line is perhaps the most prickly question facing this committee. Because of all of these operations, it is one that actually can hardly be easily replaced because there is no option for it.

It is also, in terms of cross-subsidization, far and away the most expensive of all of VIA's operations. Could you tell me offhand how many passengers a day ordinarily use the Bay line, and more specifically since you are from Thompson, how many would actually de-train at your town on an average given day? Have you any idea?

Mr. Bill Comaskey: I can't give you the exact number, but many people use the Bay line not only for trips to a tourist destination like Churchill but also as their only means of transportation.

I can drive down to the station, or our member of Parliament, Bev Desjarlais, can do the same thing, and we can see a lot of people sitting around outside on packsacks or on their coats or on the ground, waiting to see if the train will arrive.

Some of the examples of not being able to get on the train are illustrated in the brief. Some of them have to get into the baggage car because there's not enough room in the coach. Without knowing the exact number, that would illustrate how many people are using the train.

Also, the prairies marketing representative for VIA tells us they cannot get cars. If they could get cars from their headquarters, they could market them on the line.

So there's a bit of a myth out there. I've heard VIA people say they only had 17¢ of recovery on the dollar, and they left the impression that we in northern Manitoba or in northern Canada should be under a compliment to have a rail line at all, and that we were heavily subsidized by the rest of the country. Then I hear others saying we need an $8 billion high-speed train from Windsor to Quebec City.

It's an economic development issue to parts of the country; it's a necessity to people in northern Canada.

Mr. Lee Morrison: On the basis, then, of it being a necessary service, which I concur with, by the way, should we not perhaps be thinking about something cheaper than full trains—about day liners, for example? Would it be practical for this local traffic that you're talking about, and assuming that Omnitrax would agree, to just hook some sleeping cars and a diner at the tail-end of a grain train and spend two or three days getting to Churchill?

Is there any merit, in your view, in something like this that might be viable? On that last suggestion particularly, it would cost practically nothing to drag that passenger train behind a grain train. Have you or your people looked at anything like that?

Mr. Bill Comaskey: We are open to any sort of suggestion, but please don't consider us as cargo.

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We have had people ask to go to Churchill to see the whales and the bears. So many of them could get there, but they could only promise that 11 of them could get back. Anything that will work— we don't mind as long as it's not a hit-and-miss system. We need to have something that is reliable and on schedule.

VIA, in our opinion, has the responsibility to provide the passenger service and I don't believe they're being given the support by their head office. Also, with the number of dollars being cut out of their budget they just can't possibly put the equipment on the line.

So whatever it takes to get more traffic on the line— not just do with what we have or have a reduction in what we have right now. There are people who will come into Thompson for a medical examination, and if they miss the train or they don't get into the baggage car, they miss their medical appointment. If they get into Thompson and they don't get into the baggage car on their way home, they're there for another two days.

The Vice-Chairman (Mr. Roy Cullen): Thank you, Mr. Morrison.

Mr. Calder.

Mr. Murray Calder (Dufferin—Peel—Wellington—Grey, Lib.): Thank you very much, Mr. Chairman.

Bill, I noticed in your report here that you're saying that if we increase passenger rail or enhance it, or however this committee is eventually going to figure it out, there probably will be fewer cars on the road and therefore the greenhouse gases and everything— In fact, I read a report when I was on the CN task force that for every dollar investment in the rail infrastructure, there's about a $4 to $5 savings in the road infrastructure. Would you agree with that?

Mr. Bill Comaskey: Yes.

Mr. Murray Calder: Okay. In that situation, then, if we do come up with something that enhances the passenger rail system, and it is saving municipalities $4 to $5 on the road system, would you be interested in chipping into that type of enhancement in the passenger rail system?

Mr. Bill Comaskey: No.

Mr. Murray Calder: Why not?

An hon. member: The rubber hits the road right there.

Mr. Bill Comaskey: Every effort being made nowadays is to pass it over to the municipalities. Governments are applauding themselves with the balancing budgets. At the municipal level we've been doing that all along. It's no big accomplishment as far as we're concerned.

I say this with respect. I'm sure that many of you who are sitting here on this committee have had the opportunity to serve at the municipal level as well. You know what it's like. We don't believe it's our responsibility to collect taxes within our municipality to subsidize highways.

Mr. Dan McGregor (Senior Policy Analyst, Federation of Canadian Municipalities): Perhaps I might add to that. The annual report of Transport Canada issued last year showed that federal spending on transportation has declined from 4.1% of total federal spending to 1.8% in 1996-97. During virtually the same period, municipal spending on transportation increased from $3 billion in 1981-82 to $6.5 billion in 1993-94. In fact, if you look at the spending of the three orders of government, federal spending has been decreasing both in real terms and in constant dollars. Provincial and municipal spending has been increasing tremendously, largely as a result of the withdrawal of the federal government from its traditional role in terms of supporting air transportation, ports, shipping. The list goes on and on.

So now you're saying, can we cut a deal and have you spent some more on it? I think the mayor is representing the view of our board of directors quite correctly. It appears that the buck keeps going down to the municipal government level, where the basis of taxation is property tax, which is far more regressive than income taxes, which the federal government has to draw from.

Mr. Murray Calder: We just finished off what the municipalities in my riding have said was a very successful project, and it was called the infrastructure program. So what I'm talking about here is not really too different from that type of program, where you had the three levels of government working together to build something that everybody was going to benefit from.

Mr. Bill Comaskey: There's no disagreement from us on that. That was an excellent program and it's probably one of the few times I've heard it called the three levels of government.

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Again, with respect, it was considered the federal-municipal infrastructure program and then there was the federal-provincial-municipal infrastructure program. In our city, we bought into that. I will use that as an example. We agreed to it, and on our projects we paid more than our third. It was supposed to be a three-way split. It was infrastructure for a subdivision that had deteriorated to the point where it had to be to replaced, and when it came down to the final decision on it, the municipality paid the lion's share of it. But when they presented us with the plaque, all it wanted to say was federal and provincial infrastructure program.

I say that by way of agreeing with what you said with regard to the municipalities. We did buy into that and the Federation of Canadian Municipalities national board of directors was disappointed there wasn't a new announcement in the last budget.

Mr. Murray Calder: Okay, that's good enough.

The Vice-Chairman (Mr. Roy Cullen): Thank you, Mr. Calder.

Mr. Crête.

[Translation]

Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, BQ): While I was listening to your presentation, I was thinking of an ad that I saw in Europe. Someone was cooking himself a soft boiled egg, and instead of using his watch to keep an eye on the time, he watched for the next train to come along, which was expected in three minutes, just the amount of time he needed to boil his egg. If that had happened in Canada, I think the fellow would have gone through all the eggs in Canada, because we have a major problem with the reliability of Canadian trains.

In La Pocatière, I often waited for a train that only got in at 3:00 a.m., even though theoretically, it was supposed to have arrived at 9:00 p.m., 10:00 p.m. or midnight. Once that happens two or three times, you end up taking your own car.

A few years ago, they wanted to shut down the line that went all the way to Gaspé in Quebec. There were public hearings, and people realized that this railway line could be very useful for tourism purposes. Apparently today the line is profitable, unless I'm mistaken, or in any event, it is managing to do pretty well.

Now I would like to ask you a question about something that goes somewhat beyond your brief. Don't you think that the solution to the funding problem would be to first have a board of directors for VIA Rail that included people from the tourism industry, environmentalists, municipal officials, the provinces, rail experts, users—my list is not exhaustive—who would represent the entire industry, and who would learn how to work together and find common interests so as to develop some kind of medium term funding?

Secondly, don't you think the mandate should be clear? In other words, the profitable lines would have a mandate to make money, but the government would commit to providing compensation to less profitable lines. Don't you think that these are the first things to be done? In any event, that is what I got from your brief. The federal government should keep some kind of a role so that the problems with the Montreal airport don't happen again. In that particular case, they stretched the elastic band so far that it snapped. Do you think we should make such recommendations in our study?

[English]

Mr. Bill Comaskey: I think that's an excellent recommendation. Even in northern Quebec—I'm getting off the Federation of Canadian Municipalities' position on it now, but Transport 2000— I have attended some of the meetings and we are a participating member. I'm somewhat familiar with the rail service in northern Quebec.

Back to the position paper, we have said we would welcome a board of directors where there would be an opportunity for the board to make policy decisions with regard to how the service is provided. In order to do that, we believe the federal government needs to give them a legislated mandate and perhaps create a crown corporation. But I agree with you.

[Translation]

Mr. Paul Crête: Moreover, there is more and more north-south trade in North America. We have the traditional east-west volume, but there is more and more north-south volume. Even in terms of passenger rail, shouldn't our rail transportation policy take this into account and favour investment in infrastructure over the next 10 to 15 years to meet this need for north-south development?

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The growth in north-south traffic is much greater than the growth of east-west traffic.

[English]

Mr. Bill Comaskey: That is also an excellent suggestion. At the end of May there's a summit in Winnipeg hosted by Mayor Susan Thompson. It's to discuss transportation links from Mexico up through the central United States, through Winnipeg, through Thompson, up to Churchill and the port of Churchill and beyond. We see that as a great national opportunity to increase north-south transportation in Canada. So I would like to ask the committee to consider that in its deliberations.

[Translation]

Mr. Paul Crête: I have one last question. Have your members or the general public said anything to you about bilingualism within the VIA Rail network? Myself, when I used to take VIA Rail, I usually noticed that there was no service in French, even when we were crossing through Quebec.

Mr. Dan McGregor: Until now, we haven't received any such comments.

Mr. Paul Crête: Thank you.

[English]

The Vice-Chairman (Mr. Roy Cullen): Okay, Mr. Keyes.

Mr. Stan Keyes: Thank you, Mr. Chairman.

Mr. Comaskey, thank you for your presentation. There are three areas in it that I would probably challenge. I won't take up the time of the committee challenging them all, but I will challenge one. But first, on the route to Thompson and your community, what percentage of tourists versus commuters use that service?

Mr. Bill Comaskey: It's very limited right now because there's no attempt or effort made to market.

Mr. Stan Keyes: Would you be marketing for tourists or for commuters?

Mr. Bill Comaskey: We would market for tourists, and if that be by commuter, that certainly would satisfy the need. Tourism is a growth industry, as we see it. It has not been tapped yet.

Mr. Stan Keyes: If tourism is a growth area and tourists take up the greatest number of passengers that might come to your community, would you see any opportunity for the federal government to take that chunk of line and say they're going to offer that to the private sector and say, if you can run a tourist train to Thompson, it's for sale?

Mr. Bill Comaskey: No.

Mr. Stan Keyes: Why?

Mr. Bill Comaskey: It goes back to the argument that VIA will make with respect to cost recovery. If we are told that right now, in order to run the train from Winnipeg to Churchill, the cost recovery is 17¢, and if we use from Borden to—-

Mr. Stan Keyes: Let's talk numbers, Mr. Comaskey. Outside of the tourist market, how many people are going to be using that train for transportation purposes?

Mr. Bill Comaskey: Lots, because even some of the people who need to get to and from their communities right now are bumped off it in the peak tourist season.

Mr. Stan Keyes: You say lots, but I want you to be more specific. Lots is 100.

Ms. Bev Desjarlais: Thousands, thousands.

Mr. Stan Keyes: It may be cheaper to give everyone a Chevy than to put in a rail line, so let's talk numbers.

Mr. Bill Comaskey: Thousands. I don't have them with me right now, but the numbers are available of the people who go to Churchill each year. Many of them are left behind because they can't get on a car, and many people going home to their communities can't get on a car either. So it's very hard to measure how many people would be using it.

Mr. Stan Keyes: Okay.

You're talking as a representative of communities and municipalities across Canada, and not just of your own community. On page 11 you say FCM believes that an efficient, safe, fast high-standard passenger rail service will be successful. How do you define successful?

Mr. Bill Comaskey: It depends on the marketplace. I have to give you an honest answer to the Quebec-Windsor high-speed train project. I'm not disagreeing with the FCM's policy on it right now, but I have a real problem with spending $8 billion and putting in—

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Mr. Stan Keyes: Let's not go to that extreme. Let's just say we're going to increase passenger rail service with substantially better cars, etc., regular timetables and all that kind of thing, between Toronto and Montreal—corridor-specific. What would be your definition of successful?

Mr. Bill Comaskey: It would be if the customer is satisfied and it's paying its way.

Mr. Stan Keyes: Do you think more people get on it?

Mr. Bill Comaskey: Yes, I do.

Mr. Stan Keyes: How do you know this? Our experience in going abroad—for example, even with 8 million people living in Paris alone, and even with the government subsidizing rail service to the tune of $2.5 billion every year, they can't get more than 7% of their travelling public to use the train, because people love the car and they love to fly. So how can you say it would be more successful if in a country like France, where the government goes into debt to spend $2.5 billion a year, they only get 7% of their population to take the train?

Mr. Bill Comaskey: But it's an event right now to get on the train.

Mr. Stan Keyes: It's an event?

Mr. Bill Comaskey: Yes, an event. In our brief we mentioned that if there are intermodal connections— Right now people travelling by air or by other modes of transportation—in order to go on the train, you're planning that.

Mr. Stan Keyes: But France has all those intermodal connections. You get off a plane at Charles de Gaulle Airport, jump on a train and go to your community. People still don't use the train, but you're saying they will in Canada. Why will they in Canada but not in a place like France, which has the population, the mass and the money? People still don't use the train.

Mr. Dan McGregor: One of the ways we look at it is in terms of the appropriate mix of passenger transportation that a country wants to have. There are various ways of looking at it. One is what people will buy on the open market, but there are other measures, including environmental issues. Mr. Calder raised the issue of infrastructure costs earlier.

So if France is spending $2.5 billion a year on subsidizing passenger rail, the question is how much money are they then saving on road infrastructure? France is a unitary state, so it's not as complicated an issue as it is in this country.

Mr. Stan Keyes: Zero is saved.

Mr. Dan McGregor: How do you know that? How many thousands—

Mr. Stan Keyes: Because there's gridlock on their roads now.

Mr. Murray Calder: That's right.

Mr. Dan McGregor: But how much more would they be spending if there weren't people on those rail systems?

Mr. Stan Keyes: So FCM's position is that $2.5 billion to support a passenger rail service that collects no more than 7% of the total travelling public is okay?

Mr. Dan McGregor: We're not commenting on French policy.

Mr. Stan Keyes: Okay, then let's per capita those numbers down to Canada. Are you prepared to spend hundreds of millions of dollars a year to only get 4% of your travelling public on the train?

Mr. Dan McGregor: What we've been—

Mr. Stan Keyes: Is that what you're telling me?

Mr. Dan McGregor: No, we've consistently said that we think all three orders of government should sit together and attempt to define a vision of the relative weight of the various modes of passenger transportation in this country. That hasn't been done.

We're certainly willing to come to the table. We've offered that on a number of occasions. We're part of the mix. As the Royal Commission on National Passenger Transportation pointed out, the passenger auto mode is subsidized to the tune of $3.4 billion per year in this country. The passenger air mode is almost $1 billion per year, and now the passenger rail mode is down to $170 million per year. So there is hardly a level playing field in this country.

What comes first, the chicken or the egg?

Mr. Stan Keyes: That's why I am saying what I'm saying. I'm trying to explain why that is the way it is.

Mr. Dan McGregor: Yes, but it could be that if there was a more level playing field, we wouldn't even be having this discussion.

The Vice-Chairman (Mr. Roy Cullen): Thank you, Mr. Keyes.

Ms. Desjarlais.

Ms. Bev Desjarlais: I want to give Mr. Comaskey a break here. Since you're from Thompson and I'm here, they probably think we're always on the same side. I want to assure you that's not always the case. But on this issue we're definitely on the same track. I'll give you a bit of a break so they don't necessarily think we finagled this together. What you're saying is obviously a position I would have been taking, because I know how it affects the riding.

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I can answer, maybe not in exact numbers, what Mr. Comaskey was commenting on with regard to people not being able to get on the train. We're talking about five, six, or seven communities along that Bay line heading toward Churchill; it's their only form of transportation, in or out. Some of these communities have an airport this big. Their only way in and out, and it's only a couple of times a week, is rail transportation.

You have people in those communities who need to get in and out for grocery shopping or doctors' appointments, and if the trains are filled with tourists, they can't get on or they're climbing into baggage cars, or maybe they're thrown alongside the moose that might have been hauled on if somebody is taking it down the railway line. That's the reality.

To suggest we should have accurate numbers— I'm sure VIA has a fair idea of numbers. I would see it as being largely those communities using it because it's their only form of transportation, and air transportation is quite high.

Beyond that, I know you're here representing the municipalities throughout Canada. I am aware that a number of the municipalities in the western provinces, although they have road service more so than the remote communities do, felt the loss of the rail service, because we have an aging population. I don't know if that has come into the discussions with the municipalities, but has there been any indication that with an aging population there will be more usage of rail transportation?

Mr. Bill Comaskey: We haven't discussed it with the FCM board, but it's certainly an interesting point and we will take it into account.

Ms. Bev Desjarlais: It's certainly come up in some of the discussions I've had with other people, and I was interested in knowing whether it was something that had come up with them.

That's fine. Thank you.

Mr. Bill Comaskey: Thank you.

The Vice-Chairman (Mr. Roy Cullen): Mr. Bailey, please.

Mr. Roy Bailey (Souris—Moose Mountain, Ref.): Thank you, Mr. Chairman.

We have had before this committee, Mr. Mayor, people from CN, CP, VIA, consultants. The young people here will probably get a realization of the old adage, which was that the existence of Canada is a sin against geography or a sin against nature and there's no country in the world that has the unique transportation problems we have. I think we have to be realistic.

You are not alone with transportation problems, but I concur with what you say. My colleague and I are about to lose— as I told this committee some time ago, in two years they can come and take our steel. They can run a brand-new line all the way from Windsor to Montreal, and we'll give our steel to VIA Rail, which would save them a lot. Our communities are losing it because of rail line abandonment.

I'm really concerned with your group. You answered the question by saying it had to be paying its way. Now, if you study the history of transportation in Canada, whether it's passenger train or the highways, nothing ever pays its way. Let's get that straight.

For something to be a more successful crown corporation— I think I have to argue with that, Bill, for this reason. In Saskatchewan we have attempted to have a bus line, Saskatchewan Transportation Company, and even that is losing money and has lost big money.

As for the point you made about roads and the expenditure on roads, the federal government and the Province of Saskatchewan have contributed, from the fuel tax they have extracted, about 5% to roads. So to say the people who travel our highways aren't paying for them— Fifty percent of every litre of gas that goes into my vehicle goes to the roads, or should be going to the roads, so there is a high tax on roads.

I think it's incumbent upon your association not to try to get around that terrific expenditure the individual user of the road pays, because we do pay.

Let me get back to this. As a representative of your association, how do you expect to service all the areas of Canada without billions and billions of dollars coming from the federal government at this time? I don't think it's possible.

• 1625

I think the challenge facing this committee is that it is going to have to look at your problems, the problems my colleague mentioned in northern areas, but if we're going to live up to the dream of Transport 2000— there won't be enough money in Ottawa in the next 20 years to make it realistic, and I think you would agree with that.

Mr. Bill Comaskey: Please don't misunderstand me. When I said that the transportation system should pay its way, that's not what I was saying. I was talking about that high-speed rail line from Windsor to Quebec City. It should be able to subsidize some of the other routes.

There has to be government involvement and there has to be a commitment by, I'll even go as far as to say, other levels of government in order to subsidize passenger rail service. I want to make the correction, if that's the impression I left.

Mr. Roy Bailey: In your response to Mr. Keyes, when Mr. Keyes asked you what you considered successful or viable, you said one that's paying its way. I understand what you mean. I don't see any link in Canada paying its way per se.

Mr. Bill Comaskey: No.

Mr. Roy Bailey: It doesn't even happen in congested areas.

Let me get back to this. What does your organization propose in the way of meeting all the demands that have come before this committee? What do you propose the federal government should do, or what Canada should do, given the amount of money that would have to go into this? Have you done any cost figures?

Mr. Bill Comaskey: We haven't done it. As Mr. McGregor said, we, as a level of government, would be very willing to sit down with the other two orders of government and talk about it. With due respect, far too many times we're left out of the process, and by the time we are asked to participate, the decision has already been made. We would like to be included, but it doesn't mean to say we're ready to write a cheque.

You're absolutely right that the FCM has led the way with the national infrastructure program. We believe it was estimated at $20 billion to fix the crumbling roads and bridges right now. It's unfortunate there wasn't renewal in the last budget, and we would urge the committee to make mention of that in your report as well.

The Vice-Chairman (Mr. Roy Cullen): Thank you, Mr. Bailey.

I'm out of order here. With Mr. Casey's indulgence, I'll go to Mr. Nault and then to Mr. Casey.

Mr. Bill Casey (Cumberland—Colchester, PC): That will just be fine.

Mr. Robert D. Nault (Kenora—Rainy River, Lib.): Thank you.

My question is very specific. On page 9 you say that “FCM supports a legislative mandate for VIA that would allow it the flexibility to borrow money, find private investors, and build on its existing structure”. Then you go on to say that “FCM cautions, however, against the full privatization of VIA”.

Am I to take from this statement that you are not opposed to privatization of certain lines; it's just the whole privatization of VIA as we know it? I ask that because, to be consistent, you say they should be allowed to borrow money and find private investors. Then at the bottom of that paragraph, you say: “We all know that no national passenger rail service in the world is entirely self-financing”.

In essence, who in their right mind would invest, unless we change the system?

I'm under the impression that the position of FCM, and I just want to be clear on this, is that you would be willing to see some form of privatization; for example, a tourist train going into northern Manitoba. Certainly, there's still the issue of dealing with the local passengers and their needs. That's not incompatible with making sure that both work hand in hand, or you can have two separate trains.

The point is, if I'm a business person and I think I can make a good living on a small tourist train in the summer up in northern Manitoba, why would you want to be opposed to it, as a municipal leader in that particular area?

• 1630

I use that as an example because when someone asked whether you would allow someone to bid on a private run in northern Manitoba, you said “absolutely not”. I'm a little bit surprised. Being a northerner myself, I know economic development is something we're lacking in northern Ontario, as we are in northern Manitoba.

I would like some clarification about the position of FCM as opposed to the position of the mayor of Thompson.

Mr. Bill Comaskey: Thank you for your question.

We are not in support of privatization.

Mr. Robert Nault: That's not what it says in the brief.

I understand your point of view and you can speak as an individual, but if you're speaking for the organization, I want to know the position of the organization representing almost 20 million people. It says in the brief you are looking to “find private investors and build on its existing structure”, but “FCM cautions, however, against the full privatization of VIA”.

It suggests you are in favour of partial privatization in certain areas. Yes or no?

Mr. Bill Comaskey: No. That's not what it means.

Private investment: we are in favour of investment dollars in part of the corporation, but not in picking off different markets and privatizing them, because that could put the more remote lines such as the Bay line into question. Then who would take over the Bay line?

Mr. Dan McGregor: What we're trying to do here, Mr. Nault, is to express openness toward public-private partnerships. Indeed, on some lines it would be more viable than on others. But we want to maintain the whole system as a single, public sector corporation of some sort so that the public interest in terms of cross-subsidies can be maintained.

Building, owing, operating, and transferring, for example, as was done with Confederation Bridge— it's our intent to express openness to these kinds of public-private models. We don't consider that privatization. We consider it a joint venture or a public-private partnership, whereby at the end of the day it would still be owned by the public sector.

Mr. Robert Nault: I'm having a really tough time with this, and I think maybe you should go back and ask the board to clarify it for me.

I'm obviously misreading what your presentation says. You can certainly commercialize certain lines, as we have commercialized airports, and we use them as an example. They still belong to the federal government, but they are commercialized and run locally because local folks tend to want to do a little more work as it relates to making it viable and having a better understanding of it.

If we were to commercialize certain runs and keep them under the VIA corporation— Is that what you're suggesting? In some instances it would allow a private individual to purchase that particular train, have the equipment, run on it, and keep the profits, quite frankly, if in fact they were able to generate a tremendous amount of tourism by marketing that particular area.

I don't disagree with the presentation that's been made as it relates to Thompson. They're not marketing that area at all. VIA does a very poor job of that. Specifically they're not marketing the whales and polar bears. We're trying to make it successful. That's the whole objective of the committee.

I just want to be very clear what you're saying, in case some big city mayor who belongs to FCM comes to this committee and says he disagrees with the presentation that was made by his own organization, and that he is in favour of, for example, commercializing the corridor.

Mr. Bill Comaskey: Actually, I'm pleased to meet you. You and I have corresponded. You have seen letters from me on gasoline prices from time to time.

Mr. Robert Nault: Certainly.

Mr. Bill Comaskey: Thank you.

Mr. Robert Nault: I'm the guy you were talking to.

Mr. Bill Comaskey: You're the guy. I was disappointed when you left that committee and went on to something else.

Mr. Robert Nault: Bigger and better things.

Mr. Bill Comaskey: From time to time big city mayors will disagree with FCM policy. It could be individually or parochially, but as Mr. McGregor has explained, our presentation is based on FCM policy. Although I might have a disagreement with parts of it—I can get parochial as well—it is the FCM's position and we're in favour of options that can generate revenue.

• 1635

The Vice-Chairman (Mr. Roy Cullen): Thank you, Mr. Nault.

Mr. Casey, please.

Mr. Bill Casey: Thank you. I just wondered if the federation has a vision for or an overall concept of a rail passenger system in Canada. Coast to coast, is there one vision you have?

Mr. Bill Comaskey: I have to be careful that it's an FCM response, that it's not Bill Comaskey's response, because I have a vision that might not be shared by the national board of directors.

Mr. Bill Casey: Actually, you brought up another question. Before we go to the first question, has the federation really spent a lot of time on this issue? Do they have a committee that's researched it and studied it and proposed costs and frameworks and concepts?

Mr. Bill Comaskey: We have not done an in-depth study, but we do have the transportation committee. A subcommittee is looking at it right now. I sit on both committees.

We have struggled with it for quite a long time, and it's not just in quick response to an opportunity to present a brief to this House of Commons committee. We have been working on this for years.

Mr. Bill Casey: Now about the vision thing.

Mr. Bill Comaskey: I'm speaking on behalf of every municipality that's a member of the Federation of Canadian Municipalities and probably every community across the country, and we believe in this great vast country of ours there has to be a national transportation policy. The vision is that people can travel from coast to coast to coast.

When your colleague asked me what I considered to be successful, if people are satisfied and are comfortable with being able to get on a certain mode of transportation—in most cases passenger rail—and can travel from community to community, we would consider that successful.

We don't have the resources to do an in-depth study into costs and the type of mandate this committee has been charged with. We don't have those resources at FCM, but we have spent a lot of time on it.

Mr. Bill Casey: Considering the government's focus on deficit elimination, do you think there is an acceptable level of contribution to passenger rail service in Canada? Next year it's $170 million. What's the acceptable level?

Mr. Bill Comaskey: No one knows. Canadians have applauded the government's effort to balance the budget. We believe governments have become obsessed with balancing the budgets really quickly, and now they're in a bit of a quandary because they don't know what to do with the surplus.

Mr. Stan Keyes: What surplus?

Mr. Murray Calder: What surplus? Don't believe everything you read.

Mr. Stan Keyes: There was.

Mr. Lee Morrison: You blew it already.

Mr. Stan Keyes: On students, you mean?

The Vice-Chairman (Mr. Roy Cullen): Order, order.

Go ahead.

Mr. Bill Comaskey: Also, when VIA Rail states in their annual report that they are now subsidized by something like only 56% or 44%, whatever it is, they are applauding themselves for bringing down the taxpayer's cost of doing business. We don't see it as an accomplishment.

Passenger rail services need to be subsidized if we're going to provide it from coast to coast. The federal government has reached its goal in a much shorter period of time than it anticipated, and that's on the backs of people who are deprived of the opportunity to travel from community to community on passenger rail service and on other services as well.

We don't disagree that it's important to balance the budget, but don't cut to the bone. In the case of VIA Rail, we believe that's one of the things that have happened.

Mr. Bill Casey: The federation believes there should be a national coast-to-coast-to-coast passenger rail system and the feds should participate in that cost. I'm not trying to put words in your mouth, but is that basically—

• 1640

Mr. Bill Comaskey: We know there are parts of the country in which VIA is not providing a service, and we're not suggesting VIA has to include that in their overall business plan. Where there is now an expectation and a mandate to provide passenger rail service, FCM expects it to be delivered and believes it should be delivered, that it should be standardized, and that there should not be acceptable or even good service in central Canada while there is inferior, very mediocre service in northern Canada.

The Vice-Chairman (Mr. Roy Cullen): Thank you very much, Mr. Casey.

We've completed our first round. Ms. Desjarlais would like to ask one final question to the witnesses.

Ms. Bev Desjarlais: You commented on VIA's marketing and that it isn't necessarily up to par. I don't think you'd get any disagreement. I know I've met with VIA and concerns have been raised.

You made the comment that with the subsidies dropping, the service isn't there. My understanding is they can't provide those cars because they don't have enough cars. If more money can be made on a run from Alberta to B.C.—I won't pick names—even if there were an extra car, it would be pulled from there and put on another train. There were comments after the Biggar crash that it was going to be even worse because we'd probably lose another car that would be moved somewhere else.

Is it your impression that there would be greater use if more cars were available?

Mr. Bill Comaskey: I have it from both the operators and the consumer groups that if cars were available, they could be filled on these trips. So the answer is absolutely.

Ms. Bev Desjarlais: It probably seems not an overly great shock to people with respect to the train, but it also happens to the northern community with planes. If they need an extra plane and something happens so they can't do the Calgary-to-Winnipeg run, they'll take the Thompson plane and it will go. You'll just wait the extra hours in Winnipeg. It's the old argument that just because you're outside the perimeter, you never get treated the same. Quite frankly, that's the way the west feels and probably the far east coast feels about the regard for providing adequate transportation.

That's my comment. Thank you.

The Vice-Chairman (Mr. Roy Cullen): Okay, thank you, Ms. Desjarlais.

Just before wrapping up, there was an unusual coincidence today. A colleague of ours very recently was in Winnipeg. He flew to The Pas and took the train to Churchill via Thompson, and his remark was that there weren't many people on the train. But it took what he thought was an unusual way. It goes into Thompson a couple of times, in and out again, and then on to Churchill. He said he saw some of the same people on the train.

I don't understand how it works. Could you describe how the service from The Pas through to Thompson through to Churchill works?

Mr. Bill Comaskey: There's actually a spur line back into Thompson, off the line. That's why it might seem as if you were doing a back-up and then going ahead.

The Vice-Chairman (Mr. Roy Cullen): Okay, now it's totally clear. I had to ask it. It was so coincidental. I spoke to him just today, and he talked about the service. So it's one of these historical things, I guess, is it?

Mr. Bill Comaskey: It should be a normal event.

The Vice-Chairman (Mr. Roy Cullen): I see.

I would like to thank you, Mr. Comaskey and colleagues, for coming here today and for a well-presented brief. We thank you for taking the time to come here to Ottawa to meet with us to present your views. You can be sure they'll be part of our consideration.

Mr. Dan McGregor: Thank you.

Mr. Bill Comaskey: Thank you, Mr. Chairman.

The Vice-Chairman (Mr. Roy Cullen): The meeting is adjourned.