TRAN Committee Meeting

STANDING COMMITTEE ON TRANSPORT

LE COMITÉ PERMANENT DES TRANSPORTS

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, November 23, 1999

• 0902

[English]

The Chairman (Mr. Stan Keyes (Hamilton West, Lib.)): Good morning, colleagues. This is meeting 25, pursuant to Standing Order 108(2), a study on the future of the airline industry in Canada.

Joining us this morning is Fazal Bhimji, president of the Canadian Air Traffic Control Association. Mr. Bhimji, welcome to the Standing Committee on Transport. We'd like to hear from your organization in a 10- to 12-minute presentation, and then we can open it up to questions.

Mr. Fazal Bhimji (President, Canadian Air Traffic Control Association): Thank you very much.

Good morning, everyone.

The Canadian Air Traffic Control Association thanks you for affording us the opportunity to make a presentation to the committee.

Our association is 40 years old this year. We began as an organization that was involved in the safety of the aviation industry in Canada. In 1967 we also became a bargaining agent for air traffic controllers in Canada. So we've been around for some time, and our roots are more safety-oriented than bargaining for controllers.

The current crisis can be viewed as a crisis or as a challenge and an opportunity for Canada. For several years now, band-aids have been applied to try to address some real problems in the industry, with little, if any, success. The current situation, while serious, provides legislators and stakeholders a second chance to create a healthy industry.

Of course, from our perspective, any decision needs to ensure that the safety records of the industry are either maintained or improved. At the end of the day, whatever solution is chosen must address the needs of the public, the stakeholders within the airline industry, and the employees of the airlines.

The situation we're faced with today is serious. It's not an issue of who is to blame. If it's not addressed, any solution becomes a short-term fix.

Our association is not taking a position on whether there should be one airline or two airlines, but we are concerned about some of the fallout around what's going to happen.

• 0905

Total deregulation has created pressure for intense competition, which has been very cutthroat. The result has been aircraft flying less than half full, and deep discounted prices to try to fill the empty seats. The problem has been compounded because the air traffic control system has been unable to deal with the demand. The ensuing delays have resulted in lost profits to all airlines, as aircraft are held on the ground to maintain the safety of the system.

Scheduling sixty flights to depart in one hour, for example, means there's an inherent delay built into the system. The system does not have the capacity to handle that type of demand, or not with our current staff shortage.

Meanwhile, our members are ordered, sometimes against their will, to work large amounts of overtime with inadequate staff to keep the system working. This, of course, is a huge safety concern for us. Controllers have been held to work sixteen hours in a row and have been told that if they are unable to perform at full capacity for that period, they will be let go or disciplined.

There's an old joke that's always around in aviation: How do you make a small fortune in aviation? You start with a big one. We don't want to continue to contribute to that type of policy that hurts the airlines.

We have a number of concerns. First, our concern would be to maintain sovereignty over an airline for Canada. We need to make sure that there are proper controls to keep the airline Canadian. We need protection for consumers and for maintaining jobs for Canadians.

Our other concern is that quite often you'll get on an aircraft and hear that you're being held or delayed due to an air traffic control delay. A lot of those delays are actually scheduling issues, and those hurt the industry. We believe you have an opportunity to sit down and look at some of the scheduling practices with whatever comes out of this process to make sure delays are kept to a minimum.

We speak in favour of a Canadian-owned airline. Canada, being the largest country in the world, relies heavily on air transportation. It's necessary to have a healthy transportation and communication network in the country.

Our forefathers recognized that fact when they built a national railway to tie both ends of the country. Today that link is provided to all three corners of the country by air. Whether it's the movement of people or goods, aviation is considered a vital link not only for the well-being of Canadians but also for the health of the economy.

People in this country rely on air travel more than any other country in the world. Control of such a vital service must remain in the hands of Canadians. Maintaining sovereignty over the airlines is essential, especially during times when Canada is involved in humanitarian or relief efforts. We must be sure that we have the required priority to supplement military efforts with civilian aircraft when the need arises. To do this, Canadian control and ownership over our airlines is absolutely mandatory.

With regard to consumer protection, we also join with those who have expressed concern over the potential for price-gouging in the event there is only one national airline. One only needs to examine the cost of flying out of communities serviced by only one of the major airlines to realize that such concerns are very real for those who live in those communities.

In my travels across the country I've often heard people comment that it's cheaper to fly to Europe than within our own country. Price is only one concern; another is the type and frequency of service in small and medium-sized communities. Over the years, service has been eliminated to many communities.

Will this trend accelerate? Those who predict that competition for medium-size operators and regional airlines will help to keep prices reasonable are asking us to put our faith in an as yet unproven assumption. In fact, the business traveller will not likely opt for the medium-size carriers who do not service all the destinations to which they need to travel. It's a matter of convenience.

Many jobs spin off from aviation. Other related jobs would be in the industries of food, entertainment, finance, and consumer goods. An absolutely crucial element of this issue is the preservation of jobs for Canadians. Aviation impacts on all sectors of the economy, and these jobs should be protected for Canadians.

There's been an estimate of some 5,000 job losses. We would say that if you also look at the spinoff jobs involved, that's somewhat low.

On scheduling, part of the problem has been the toe-to-toe competition between the major airlines. Whenever a red aircraft takes off, a blue one leaves, hot on its tail, and vice versa. This means the system has a lot of unused capacity. An examination of the schedules will show that there are times when there are more aircraft scheduled to depart than can be physically accommodated in the time allotted for departures.

• 0910

For example, we cannot have five or six departures from Pearson all at 8 a.m. This means delays are built into the scheduling practices of the airlines, and they're not due to so-called air traffic control delays. To compensate for this, airlines sometimes allow for a cushion of several minutes in the flight schedules they publish. For example, it now takes longer to fly between Toronto and Ottawa than it used to. Just look at the schedules.

Some regulation in this area would not only ensure that aircraft are not burning profits on the taxiways while waiting to depart but also assist with issues such as air rage and system capacity.

We're recommending that the government take an active role to prevent any potential negative consequences and address any negative effects of any action or inaction on their part. Safety must not be compromised.

At the end of the day, the airline industry must become more viable, and protection for consumers and employees must be seen as priorities that are addressed with concrete measures in the long term.

Thank you very much.

The Chairman: Thanks very much, Mr. Bhimji, for your presentation.

Colleagues, we'll get into questioning, but I just want to remind you that Mr. Bhimji has touched on matters related to the terms of reference of this committee. We have had experience where some presenters have come to us and bootlegged the committee, in no veiled attempt, with their concerns. That's fine and dandy, but sometimes their concerns can be raised at a different venue.

For example, safety is a very important factor, but the concerns raised may have been better discussed with the Transportation Safety Board.

If you would try to keep your questioning to the terms of reference of the committee, the chair would much appreciate it.

We'll begin with Val Meredith.

Ms. Val Meredith (South Surrey—White Rock—Langley, Ref.): After that, I'm not sure what questions I should be asking, but I'm going to go for scheduling.

You've brought up some issues that you would be aware of as an air traffic controller—for instance, the issue of slotting. You seem to think that the way slots are handled now, where you have five or six departures at any one given time at an airport, is putting on additional stress. How would you accommodate opening up slots for new carriers who might want to enter the market?

Mr. Fazal Bhimji: We try to provide a service to people on a first-come, first-served basis. We don't get into choosing between one or the other. We don't believe that's our role.

It's really something the airlines need to come to grips with together. If they can't do that, then I think where the system is being hurt by their inability to come to an agreement there's a role for a third party to get involved to mediate or hand out slots. How that would be done would be up to the regulators, I believe.

Ms. Val Meredith: If an absolutely new carrier trying to get in on the marketplace showed up at Pearson Airport with a plane in the middle of the pack between the airlines, you'd send them up anyway, even though they didn't have this slot arrangement with the airport?

Mr. Fazal Bhimji: That's the way we work. We don't actually do the slotting, as controllers. As aircraft taxi out, we take them on a first-come, first-served basis.

Ms. Val Meredith: Do you know of any regulations or anything that would prevent somebody from just entering the market in that way, just rolling their airplane up onto the taxiway?

Mr. Fazal Bhimji: No, nothing at the moment. At very busy airports, we do have rules that exclude general aviation, for example. They would have to call up in advance and make sure there was enough capacity to handle that type of aircraft. But schedules, we don't get involved in that at all.

Ms. Val Meredith: But you can't see your air traffic controllers telling a new carrier on the block, no, I'm sorry, we don't have the capacity to handle that.

Mr. Fazal Bhimji: No. We try to stay out of the policing of it, totally.

Ms. Val Meredith: Okay.

• 0915

You seem to be suggesting there is a need to restructure the airline industry. From the air traffic controllers' point of view, do you feel you're part of that restructuring, or do you feel the system under which you're working works fine? Is there a need to look at restructuring air traffic controlling itself?

Mr. Fazal Bhimji: I think we certainly have a role to play and some advice to provide on something like that. I'll give you an example. Recently in Vancouver they redesigned part of the ramp area, and nobody thought to ask the controllers to get involved in that. It turns out that they didn't put enough concrete down, so when an aircraft actually pulls back from the gate, we don't have enough room to move aircraft behind them to get from one end of the airport to the other. So it totally shuts that airport down as soon as one aircraft backs up from the gate.

People don't always look to us for answers on things we can help out with. On system capacity there are issues to consider such as weight turbulence, which delays how many aircraft we can get off in an hour from a particular runway. We could provide some expert advice on that. Whether we're one of the key players is something I would leave up to the committee, but we certainly can contribute and help make things a lot smoother for everybody.

Ms. Val Meredith: It almost sounds as if your expertise and suggestions are required at the construction stage of airports, as opposed to the management of them.

Mr. Fazal Bhimji: That's right. We're more technical advisers than runners of an airline.

Ms. Val Meredith: You made a comment about the expectations of your organization to meet the growing demands of the air services. Is your association not under the auspices of the National Transportation Agency as far as when you can work sixteen hours straight?

Mr. Fazal Bhimji: As a matter of fact, we made that an issue in our last round of bargaining, and ultimately we couldn't get agreement on it. As you may be aware, there was some pressure to come to a deal in a hurry, so we formed a joint committee with Transport Canada, ourselves, and NAV CANADA to try to get some recommendations for regulating hours for controllers. Britain, for example, already regulates those hours, but in Canada we don't have regulations on those types of things. Our association believes very strongly that it's time for us to look at that.

Ms. Val Meredith: Thank you very much.

The Chairman: Thanks, Val.

Mr. Fontana, please.

Mr. Joe Fontana (London North Centre, Lib.): Thank you, Mr. Chairman.

Thank you, Mr. Bhimji and CATCA, for the presentation.

I want to applaud you for talking about some of the issues we need to get our heads around, and that's consumers and where they fit into this whole puzzle. After all, without the flying public, you don't have jobs, airlines don't have personnel, nobody has anything. So I think it's fair to say that the consumers have to be taken into account.

It's also unfortunate, as I understand, Mr. Chairman, that NAV CAN is not going to be here or chose not to be here, because, as we know, some of the issues are around pricing.

Maybe you can give me some insight. It would seem to me, based on some representations made by the airlines, airports, new entrants, and so on, that fees factor very much into the equation. As you said, Mr. Bhimji, consumers are a little dubious about the pricing policies of airline companies, but part of that pricing, as you know, is NAV CAN fees, which at the end of the day are paid by the consumers. Small regional carriers are an important part of Canadians' travel plans, and unless you have regionals and independents serving those small communities in our country, people are going to be denied some transportation. So the fees NAV CAN charges are very much a factor in a competitive environment.

You own part of NAV CAN, or at least you have a seat on the board. From the NAV fees to the airport fees to the airline fees to everything else, all have to do with what the consumer pays. I'm sure you've probably heard, and your board may have discussed, NAV CAN fees as they relate to consumers. Can you give us some insight?

• 0920

One of the reasons we went to a NAV CAN system as opposed to a governmental system was to remove the air transportation tax and get it to the user so that hopefully consumers would benefit from that restructuring of air navigation. I wonder if you have some views as to your piece of the puzzle in terms of that pricing.

Mr. Fazal Bhimji: Actually, I have a comment to make before I answer your question.

I'm really pleased to hear you talk about the consumer as the end user and the customer, because I think that's one area where NAV CANADA needs to do a little more work. They seem to have taken the focus that the airlines are the customer. We believe very strongly that it's the person who ultimately is paying for the ticket who is the customer. So I thank you for that.

As far as the fee issue is concerned, I don't often get to say how well NAV CANADA is doing on something, but I think this is an area where they have done an incredible job. They have lowered the fees on more than one occasion since the transfer in 1996. Our fees are more than comparable. When you look at the international situation, they're among the lowest of any country, despite the fact that we have to service a much larger country than they do elsewhere. If you look at what the airline ticket tax was compared with the fees that are being charged for air navigation services today, they were only a fraction.

Where the problem has come in is that whenever NAV CANADA has reduced fees, we haven't seen a parallel decrease in the cost of tickets. In fact, they've either remained the same or gone up slightly. So it appears to us as an association that airlines are either getting financial pressure through other means, such as fuel taxes, airport taxes, and things like that, which are also hurting them, or that they're hanging onto some of that money they're saving.

Mr. Joe Fontana: Then would you suggest we have a much more transparent ticketing system—and this brings back transparency and accountability—where the ticket actually tells the customer what your fees are for that airline so that in the event you achieve some efficiencies and your costs are dropping, the customer could say aha, the airlines aren't passing on those things? As I understand it, you charge those fees to the airlines, and the airlines pass it on to the customer. You know what those fees are. Surely there's a way to determine whether or not fees are coming down and the consumer is getting a break.

I know that to you it doesn't make any difference whether that blip on your radar is a 747 or a Dash 8, because at the end of the day you have to do the same due diligence on that one aircraft coming in. But the fact is that the small regional carrier that's bringing in people from Rimouski, B.C., or London, Ontario, let's face it, is paying a disproportionate amount of that navigation fee from what a 747 is because it's not applied on a per-passenger basis, it's based on weight, etc. I've heard that in fact the Dash 8s, the small regional carriers, are having to pay a significant portion of those navigation fees compared with a 747.

Mr. Bhimji, I'm happy you talked about the customer, but I'd be less than frank if I didn't tell you that I hear customers saying they have been delayed because of so-called controllers' actions. Customers want service too. But I must tell you that I am told about all kinds of excuses as to why we can't land and why we can't take off on time, because of controllers' actions, work to rule—

The Chairman: Joe, I'll have to ask you to get to your question.

Mr. Joe Fontana: I just want to make sure you understand that some of what you do impacts on the customer and whether or not they're happy flyers.

Mr. Fazal Bhimji: There are three areas I heard. First of all, as far as the transparency of pricing on tickets is concerned, the NAV CANADA fees are already shown on there, and we would welcome any other costs that make it clear to consumers where their money is going. We would totally support something like that.

As an observation, since the very beginning, those fees have been shown on those tickets. At NAV CANADA we've reduced the fees by over $150 million in the two years they've been around, yet that price on the ticket has remained the same. So there has to be some way of making sure that the true price is indicated on the ticket. That's one issue.

• 0925

On the relative amounts that people pay for fees depending on the type of aircraft, that was worked out over a period of time. If a particular operator is unhappy with how they're being charged, there's a process to go through to appeal those fees. So we would certainly welcome the smaller carriers flying smaller aircraft to use that process to try to get their issues addressed.

On controller actions, nobody's ever come to me and asked me what a particular situation was in Toronto, and I can tell you that there have been times when the employer has been found to have improperly characterized what was going on at Pearson. The fact remains that we have controllers there who are working nine days in a row with one day off, often working twelve and sixteen-hour shifts. It's physically impossible to fill all the slots on the schedule with the staff that we have. That leads to delays.

I'd be happy to sit down with anybody who's been delayed for whatever reason at Pearson. I'll leave my cards with you, to sit and work that out.

The Chairman: Thank you, Mr. Bhimji.

Mr. Guimond, please.

[Translation]

Mr. Michel Guimond (Beauport—Montmorency—Côte-de- Beaupré—Île-d'Orléans, BQ): Mr. Bhimji, when Minister Collenette appeared before us on October 26, he talked about certain aspects of a framework policy which, in my opinion, was to lead to the tabling of a bill before the House adjourns for the Christmas break.

One of the components of this framework policy pertained to consumer and employee protection. On the last page of your presentation, in both the French and English versions, under the heading “Recommendations”, you state:

Protection for consumers and employees must be seen as priorities and addressed with concrete measures not just promises.

In order to help this committee prepare pertinent and intelligent recommendations, could you describe to us what you mean by concrete measures? Could you give us any examples of concrete measures that should be included in the future piece of legislation with respect to consumer and employee protection?

[English]

Mr. Fazal Bhimji: Concrete things, such as I think there needs to be a review to find out, first of all, whether the perception that exists out there, because perception sometimes is reality.... There is definitely a perception that in smaller communities they believe they're paying a much higher fee than what is required. If the truth is that, no, that's what it actually costs to provide a service into a community like that, then there needs to be some way for those people to be assured of that type of thing.

They can't have it both ways. Either they're charging a fair price there and price-gouging people, lowering the prices artificially to try to put another airline out of business between the bigger communities, or they're charging too much in the smaller communities. So some kind of balance needs to be found to assure the people in the smaller communities they are being treated fairly.

[Translation]

Mr. Michel Guimond: We know that we're potentially heading in the direction of a so-called dominant carrier. The chairman, in his opening remarks, asked us to refrain from asking too many questions about security since these questions were best dealt with by the Transportation Safety Board of Canada. Nevertheless, I would remind our chairman that, in making his framework policy presentation, the Minister told us that security remained the number one priority of Transport Canada. At any rate, we always get catch-all statements, namely, everybody is in favour of virtue and should lead a good life on earth. Although the chairman does not really want us to question you very much on this issue, I would like to ask you some questions about the cutbacks at NAV CANADA which have had a tremendous impact on security in the regions. I will try to formulate my question in another way.

• 0930

Do you feel that the arrival of a dominant carrier and the merger of regional companies could have an impact on the security of travellers or do you believe that this new way of structuring air services will have no direct bearing on the security of air transportation in Canada?

[English]

Mr. Fazal Bhimji: As I said at the beginning of our presentation, we have stayed neutral on the question of whether there should be one or two airlines.

On the issue of safety, I know, speaking on behalf of our members, that we will do everything to make sure that the system remains safe. I don't feel qualified to answer the question based on the premise you're saying, on whether it would be enhanced or made worse by a merger, but I know it's not in anybody's interest in the whole aviation community to have an unsafe system.

Mr. Michel Guimond: Thank you.

The Chairman: Thank you very much, Monsieur Guimond, for your intervention.

Stan Dromisky, please.

Mr. Stan Dromisky (Thunder Bay—Atikokan, Lib.): Thank you very much, Mr. Chairman.

For the viewing public, Mr. Bhimji, could you please tell us who you work for?

Mr. Fazal Bhimji: I work for NAV CANADA, which is a private company that provides air navigation services, including air traffic control. However, I'm on a two-year leave of absence from my job as I serve as president of the Canadian Air Traffic Control Association.

Mr. Stan Dromisky: Thank you very much.

Now let's go into the tower. When do you and the tower first become involved with an incoming flight? Is it 100 miles away, 200 miles away, 300 miles away, five miles away?

Mr. Fazal Bhimji: It really depends on the type of flight. There are flights we're responsible for from the moment they leave the gate at one destination to the time they get back onto the apron at wherever they're going, which fly normally under instrument flight rules. We're responsible for them right from the time they push back. Other aircraft, if they're flying in remote areas, may be in uncontrolled air space, so the moment they would enter controlled air space we would take responsibility for them from that point. So it depends on where you're flying and the type of flight you're on.

Mr. Stan Dromisky: Let's take an example in northwestern Ontario. Many of the flights are very short, going from community to community by regional carriers. Are you in control of those regional carriers as they go from port to port to port?

Mr. Fazal Bhimji: Yes, we are. We have two types of members. There are some who work just out of control towers, which the public is most familiar with. They would normally be responsible for an aircraft that's flying up to 5,000 feet high and within a radius of five miles of that airport. But we also have controllers who work using radar screens as an aid, who would work the aircraft en route from one airport to another. So we're in constant communication with aircraft as they travel. And certainly for any scheduled service we're there providing a service for them the entire flight.

Mr. Stan Dromisky: Going back to that region of the country, we know that as far as face-to-face communication between the tower and NAV CANADA officials and pilots is concerned, you have the highest frequency in that region of the country, there's no doubt about it. Yet I'm very concerned about the kinds of things NAV CANADA is contemplating regarding the decline or the elimination of certain services and using their wonder machines and transferring the responsibilities from a hub such as Thunder Bay to another hub such as Winnipeg, in light of the fact that there are a great number of accidents. Most of the accidents that happen in northwestern Ontario and the rest of this country are people-centred, not mechanical.

What concerns do you have as part of that organization regarding this type of centralization, or decentralization, or whatever you want to call it, or moving of services from one hub to another hub and expecting the people who are working maybe twelve, sixteen hours, nine days in a row, let's say, in the Winnipeg system to cover all of northwestern Ontario?

Mr. Fazal Bhimji: I'm not sure if you're referring to a specific project or just a general philosophy. Maybe you can help me out there, because there are some projects ongoing right now.

Mr. Stan Dromisky: Yes, I know. NAV CANADA is doing some examining of moving services from one community to another community, and I'm wondering what impact it would have.

Mr. Fazal Bhimji: If you're talking about the flight information centre concept, it's another association involved with that. I'm not sure what position they've taken, so I'd rather not comment on that.

• 0935

Mr. Stan Dromisky: That's fine. I understand that.

Can you tell me about languages that are used for communicating with pilots coming in, whether transborder, foreign planes coming in, or even domestic?

Mr. Fazal Bhimji: It hasn't been an issue for us. We do provide a bilingual service all over Quebec and out of the national capital region, but elsewhere English rules the day in aviation.

Mr. Stan Dromisky: Even over Quebec.

Mr. Fazal Bhimji: We have to make sure that we provide service there in both languages, as it's requested.

Mr. Stan Dromisky: All right.

In terms of planes coming in, does a major carrier have priority for landing over a small two-seater, for instance?

Mr. Fazal Bhimji: I think that's actually what makes it necessary to have air traffic controllers, because they would certainly like it that way. But we always try to provide a service on a first-come, first-served basis, because while—and we understand the argument—it costs more to fly a Dash 8 than a little 150 that's out there with a pilot learning to fly, that pilot who is learning to fly is paying $100 an hour to rent that airplane and get instruction. That probably is a significant percentage of the budget that he has as well.

Mr. Stan Dromisky: Thank you very much.

The Chairman: Thanks, Mr. Dromisky.

Ms. Desjarlais, please.

Ms. Bev Desjarlais (Churchill, NDP): Thank you, Mr. Bhimji. It certainly is a key aspect of the restructuring, because I don't think there's any question that what affects the airline industry in one area is going to affect it ultimately at the price to the consumer.

I don't know if you can answer this, but I'll ask anyway. Should there be one airline, would that reduce the amount of income that would come into NAV CAN? This might be a better question for NAV CAN, but since they're not coming.... Would that reduce the amount of income that NAV CAN has coming in, and then possibly create problems for their operational expenses?

Mr. Fazal Bhimji: I think financially they're doing okay. And even if there were one airline, I don't see how that's going to lead to a 50% reduction. There will be a slight reduction and an effect on their finances, no doubt, but I don't see it being as significant as one would have thought.

Ms. Bev Desjarlais: I also consider the comments you've made about when things are mentioned, such as that it's this type of a problem and that's why the delay is happening, and as passengers we tend to accept all those reasons we hear, and often it is because of traffic coming in, or someone waiting one step higher in the air than the craft below.... But I find it very interesting, too, that you said five aircraft might be scheduled to leave at 8 p.m. from Pearson and they can't handle that. What would be the normal or the reasonable amount of aircraft that can be handled at any one time?

Mr. Fazal Bhimji: Maybe I can explain that a little bit more.

For safety reasons, when you're departing behind what's called a heavy aircraft like a 747, we have to allow for three minutes before we can depart another aircraft, because what happens is an aircraft that size displaces so much of the air in front of it that you get something called “wing-tip vortices” as the air rushes back in, and it's strong enough that it could actually interfere with the control of an aircraft that's flying slowly, and it becomes a safety hazard.

So if you have five aircraft all departing at 8 p.m., the last one is going to be departing at 8.15 p.m.; so that affects the capacity of how many aircraft you can get off.

Ms. Bev Desjarlais: Does that only apply to smaller aircraft that are departing, or would it...?

Mr. Fazal Bhimji: No. Even the larger aircraft have to be delayed. The delay from a heavy to a heavy may be shorter. You may be able to shorten it under certain circumstances, but there will be a delay.

Ms. Bev Desjarlais: Are those same types of rules in place in all countries? Is it one of the things that has to happen?

Mr. Fazal Bhimji: Yes, exactly.

Ms. Bev Desjarlais: I was also very concerned about your comments that there are air traffic controllers working sixteen hours a day, some nine days in a row. If we don't have any kind of control in place, I can't help thinking that we're just an accident waiting to happen. I can't imagine someone working nine days, sixteen hours a day. I would be curious to know how many instances there are of air traffic controllers working sixteen hours, even five days, two days, three days in a row.

Mr. Fazal Bhimji: It's happening all the time in the major centres, all the time. I was just in Victoria this past weekend at a board of directors meeting where one of the directors pulled out his schedule for me, and he has three days off in December.

• 0940

Ms. Bev Desjarlais: I often compare air traffic controllers to what I consider a very strenuous and tension-gearing job, that of a surgeon. Actually, I believe I read one time that air traffic controllers have the most stressful job, bar none. But I compare them to a surgeon. They have flights coming in and out. I often wonder how people would feel knowing that their surgeon had done five days in a row of sixteen hours if they're the next patient on the table. I wonder just how safe that would be.

I certainly value your comments. I think we should take very seriously your comments about needing some controls and ensure that we look at that as well.

Thank you.

Mr. Fazal Bhimji: Thank you.

The Chairman: Thank you, Bev.

Bill Casey, please.

Mr. Bill Casey (Cumberland—Colchester, PC): Thank you.

Good morning. I have a couple of questions here, first a quick one on the Vancouver crash between the two light planes. Were they under air traffic control? How did that happen?

Mr. Fazal Bhimji: I don't have all the details on it. I know one of the aircraft that departed Langley was talking to one of our controllers but had been cleared out of the zone because they were going out of controlled air space. I don't have many more details other than that. From what I know, I understand the crash occurred in uncontrolled air space.

Mr. Bill Casey: Okay. Going back to the subject at hand, there have been suggestions previously in this set of meetings that if there is a dominant carrier that controls say Air Canada, Canadian Airlines, a low-fare airline and a regional, they will have undue influence on NAV CANADA. Do you have a comment on that? NAV CANADA is there to serve everybody. Do you think they would apply undue influence?

Mr. Fazal Bhimji: I think a lot will depend on how things are on the NAV CANADA board of directors. When NAV CANADA was set up, I think there was actually a warning from one of the consulting firms—I believe it was Young and Wiltshire—that we should be careful not to have too much airline influence on the board of directors, because there is definitely a conflict of interest.

In my estimation, in my personal opinion, I think we're there. We need to look at how much influence the airlines have on the board of directors of NAV CANADA.

Mr. Bill Casey: You think even right now it's—

Mr. Fazal Bhimji: I think we're there now.

Mr. Bill Casey: The argument could be made that it will be worse if it is there now.

Mr. Fazal Bhimji: I would concur with that.

Mr. Bill Casey: Earlier in your comments you said you had made a point of saying it's important that we maintain control and ownership of our Canadian airlines. Do you have a position on the maximum 25% foreign ownership in all Canadian airline companies?

Mr. Fazal Bhimji: I haven't taken a position on that. Our board of directors hasn't discussed a specific percentage.

Mr. Bill Casey: What about the 10% in Air Canada? Do you have an opinion on that?

Mr. Fazal Bhimji: No, I'm sorry. I couldn't do that justice.

Mr. Bill Casey: Moving on to another subject, the airlines charge me as a customer $7.50 to fly from Moncton to Montreal and then another $7.50 from Montreal to Ottawa. Generally speaking, do those amounts add up to almost the equivalent amount charged to that airline by NAV CANADA? Are the airlines making money, or are they falling behind on those?

Mr. Fazal Bhimji: As I said, when they first put the fees on, that's what it was; it was $7.50. So I assume, at that point, it was supposed to be exactly what was turned over to NAV CANADA. I'm starting to doubt that now, because they've had a couple of fee decreases and the number hasn't gone down. Nobody has sat down and shown me, okay, it's now actually $7.40, instead of $7.50. So I would have to question why that figure hasn't been affected by the fee breaks they got.

Mr. Bill Casey: In the spring, I think they had a fee reduction of $90 million, and another one of $170 million, or maybe they're combined.

Mr. Fazal Bhimji: That sounds right.

Mr. Bill Casey: We talked earlier, over the last year, about some air traffic control towers being less than up to standard. Do you think some of those towers should be refurbished or enhanced or replaced, rather than this money being refunded at this time?

Mr. Fazal Bhimji: Absolutely. I think it was premature to go with breaks on fees when we already had one of the lowest in the world. If we're already at that stage, then the money should be reinvested in the infrastructure for the system we have.

We have towers that are sadly in need of repair. For example, in Springbank, which is one of the next towers to be rebuilt, when it rains, it actually rains inside the tower. There's water coming down the window. We have a major problem with flies; you can see they're actually crawling over each other on the windows.

• 0945

Mr. Bill Casey: I was in that tower, and if there ever were a fire in that tower.... That's what got me.

Mr. Fazal Bhimji: It's a tinderbox.

Mr. Bill Casey: The people in there wouldn't have a hope.

Mr. Fazal Bhimji: Yes, you're absolutely correct. So there is a lot of work to be done. They've started to do some of that, but not because they're being benevolent. It's because they've had their hand forced.

Mr. Bill Casey: Thank you.

Mr. Fazal Bhimji: Thank you.

The Chairman: Thanks, Mr. Casey.

Mr. Bailey, please.

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

Thank you, sir, for being here. I find your presence somewhat beneficial indeed, compared to some of the witnesses we've had. So that's a tip of the hat to you this morning, despite the bad cough I see you're fighting.

Last night we had a safety group here, and they had a bill of rights for us. If I remember correctly, that particular group did not make reference to the big topic you have referred to, sir, and that is the hours worked. It seems to me that would be the greatest safety factor of all.

I find this amazing, what you have told me, when I think that internationally or nationally, truckers must keep a log book and prove how many hours they have driven. We've had a big squabble in Canada about nurses working overtime. Bev alluded to doctor shortages and them operating overtime. Boy, when I listen to the hours of the people in your profession and what's expected of you, it seems to me we really push the safety limit to the edge there. I'm not too sure whether that would be very soft language right now for passengers who are flying for the first time or infrequent flyers to learn.

What actions is your association doing to try to get this broken down into a reasonable hour of employment for a very stressful occupation such as yours?

Mr. Fazal Bhimji: As I said, we have a tripartite committee. The first meeting is going to be on 20 December, which I hope will come up with some suggestions for regulations. But really, we sometimes feel quite powerless in making these kinds of recommendations.

One of the biggest things is mandatory overtime. In a safety-sensitive occupation, I really believe that's improper. If somebody is not feeling up to it, I don't think anybody has the right to say to them, “Get in here and perform at full level or you're fired.” And that's what's happening out there. I've had people who have worked six overtimes in a month who have been cancelled for not pulling their weight. I think that's far too many already.

So we definitely need somebody to be looking at it, somebody other than the two parties, NAV CANADA and CATCA. We need somebody else watching what's going on here.

Mr. Roy Bailey: Earlier you said that in some areas, services have been eliminated. Do you mean totally eliminated?

Mr. Fazal Bhimji: In some areas they've been changed. Instead of an air traffic control service, they're now providing a flight information service. The difference is having traffic lights versus stop signs. In a controlled service, the controller will say you can't do this. In an advisory service, the pilot has the authority to disregard what they're being told, because they're not being told to stop; they're just being given information about other aircraft out there. So services have been changed. And in some places, yes, service has been eliminated.

Mr. Roy Bailey: This would be in smaller centres.

Mr. Fazal Bhimji: That's right.

Mr. Roy Bailey: My last question to you is this. You mentioned that delays are built in, and you made reference to the reason: for the safety of the aircraft. But you do have one specific slide in your presentation that interests me. On the page entitled “Jobs”, you mention that your association is maintaining jobs for Canadians. You say that an estimate of 5,000 jobs is very low, and there are almost as many indirect jobs. Are you suggesting that one dominant airline will create that many fewer jobs?

• 0950

Mr. Fazal Bhimji: That's what we're saying, because following what's been reported in the media, even Air Canada admits there will be some reduction in size. They don't throw the figure of 5,000 out any more, as was thrown out with the previous bid that was there, but they're not living up to what's really going to happen. We've talked to other unions involved in the airlines, and we believe their numbers are closer to the truth; they're higher than 5,000.

The Chairman: Thank you, Mr. Bailey.

Mr. Sekora, please.

Mr. Lou Sekora (Port Moody—Coquitlam—Port Coquitlam, Lib.): Thank you very much.

I don't know if this question has been asked, because I had to go to another committee. The air traffic controller has a fairly hard job to do, and I realize that. I fly to Ottawa and to other parts of the country and everything else. I'm wondering if air traffic controllers have any say in streamlining the waiting on a runway.

For instance, quite often I leave at 2:05 on a Sunday afternoon or that type of deal, and we're number 14 or 15 or 16 on the runway. If I'm going to sit on a runway for three-quarters of an hour, why not delay that flight or make it five minutes earlier or whatever? It's the same if you go to Victoria on Vancouver Island. It's a 10-minute flight from Vancouver, but you sit on the runway for 35 or 40 minutes to get airborne.

Do the airline people and the controllers and the whole industry talk together to maybe streamline some of these things, so that it's not that silly?

Mr. Fazal Bhimji: If we have adequate staffing in accordance with what the employer believes is adequate, then we don't have any means to delay aircraft at the gate. It's totally up to the airline as to when they're going to push back a departure. They have certain targets to make, and it's very costly for them if they can't get to a destination and be there at a certain time, because as people miss their connections, there are additional costs involved for the airlines.

So we don't say to them that they're going to stay at the gate and leave at such-and-such a time. Other countries do, by the way. They do slot them at the time they're going to leave the gate. But the only time we will get into that is if we have a serious staff shortage where safety may be affected. Then we will put in something we call a ground delay program, and we will say to them that we're restricting the number of departures or the number of arrivals going into a particular airport.

Mr. Lou Sekora: I didn't really get an answer to my question.

Mr. Fazal Bhimji: Okay, help me understand it then.

Mr. Lou Sekora: Okay, yes. To me it's very, very simple. Say I move away from the gate at 2:05, when it's supposed to depart, and I'm number 16 on the runway. Do you airline controllers not say that's silly? If everybody is leaving at 2:05, maybe you should tell whoever is in power to stagger these flights five minutes apart or something, so they're not leaving the gates at the same time, and make it a little easier to get airborne.

Then when you're airborne, the pilot comes on and says “Ladies and gentlemen, you're four hours away from Ottawa.” But you've been sitting for three-quarters of an hour to get airborne.

Mr. Fazal Bhimji: Yes, absolutely. We're advocating that whatever you're going to do here, you have an opportunity to look at exactly that. You can make sure scheduling is also an issue that's looked at, to make sure that doesn't happen. So we would be in favour of something like that.

Mr. Lou Sekora: Okay, I really appreciate that. Those were the main couple of items I was concerned about. Thanks.

The Chairman: We'll have one question from Val Meredith and one question from Mr. Casey, and then we have to move on to the next witness. One question each, please.

Ms. Val Meredith: My question is about the technology, and it's following up Mr. Dromisky's question about controlled airspace as opposed to uncontrolled airspace.

Twenty years ago when I was flying, the majority of Canada was under uncontrolled airspace. Has the technology changed so that has changed? And is the technology we're using in NAV CANADA adequate for the 21st century?

Mr. Fazal Bhimji: Well, first of all, because of the size of the country and how sparsely settled large portions of it are, we do have a great deal of uncontrolled airspace in Canada, more so than anywhere else. That's not unusual. I don't think the ratio of controlled to uncontrolled is a concern.

As for the rest of the question.... I'm sorry; help me out with the last part again.

Ms. Val Meredith: Is our technology up to snuff?

Mr. Fazal Bhimji: It's not where it should be. We have some towers that are working with very antiquated equipment and things like that. But NAV CANADA is working on resolving a lot of that. They've been working on a project called CAATS, which stands for the Canadian Automated Air Traffic System. While it's experienced the usual delays, cost overruns, and things like that, it is still scheduled to come in, and when it gets in, we're told it's going to be state of the art. So we're looking forward to getting that equipment.

• 0955

Ms. Val Meredith: Thank you.

The Chairman: Mr. Casey.

Mr. Bill Casey: You mentioned earlier, in your concern about consumers, that you don't believe the regionals will provide competition. Do you have an opinion on which is best: should the regionals be divested from the dominant carrier or should they be part of the dominant carrier?

Mr. Fazal Bhimji: It's important that they're divested, because as long as the major airline has a significant interest in the regionals, they'll be able to dictate what routes they're going to get, what they're going to charge, and things like that. So we would definitely advocate divestiture there.

The Chairman: Thank you, Mr. Casey.

Mr. Bhimji, thanks for your presentation to the committee and for answering our questions.

Colleagues, we'll suspend for five minutes to change witnesses.

• 0956

• 1005

The Chairman: Colleagues, resuming our hearings, our next witnesses before our committee are from the Association des Gens de l'Air du Québec. Serge Martel is the president, and Antonin Alain is the vice-president.

Gentlemen, welcome to the Standing Committee on Transport. If you could give us your presentation in 10 to 12 minutes, we'll then take questions. Thank you very much.

Mr. Serge Martel (President, Association des gens de l'air du Québec): Thank you, Mr. Chairman.

[Translation]

Mr. Chairman, members of Parliament, thank you for giving us the opportunity to appear before the Standing Committee on Transport as you study the future of the air transportation industry in Canada.

The Association des gens de l'air du Québec is a non-profit organization that brings together people in the aviation sector in Quebec who wish to promote the use of French in aviation.

Our members include pilots, maintenance technicians, air traffic controllers, flight attendants as well as many others working in the field of airline company management.

Our brief has two main components: the first will deal with the impact of having one main national carrier, and the second component will deal with the enforcement of the Official Languages Act in air transportation in Canada.

The Gens de l'air have paid close attention to the public debate on this issue. The present crisis situation stems from Canadian's financial difficulties. We must remember that this company is staggering under a debt load of over $3 billion, that results from badly managed mergers.

Its aircraft fleet is old, which means higher fuel and maintenance expenses. Canadian is suffering from the negative impact of its association with AMR, which costs the company over $200 million per year in various service fees. The Oneworld Alliance routes between Canada and the United States are for the most part provided by American Airlines and its regional subsidiaries, thereby eliminating a good source of revenue for Canadian.

We see that Air Canada has had significant financial advantages compared to its competitor. In fact, when the former Crown corporation was privatized, the Government of Canada took over part of the accumulated debt of Air Canada. Everyone knows that it is easier to make ends meet on a budget when you're not obliged to make mortgage payments on the family home.

Canadian's problems have nothing to do with the relatively small size of the Canadian domestic market. For example, Australia has two major domestic carriers that are in fairly good financial shape. The distances between communities in Australia are comparable to what we find here in Canada and Australia's population is smaller than that of Canada. It seems to us that the size of the market is not a major factor in the current crisis.

A monopoly on air transport will only benefit the shareholders of this company. Therefore, it is understandable that the managers of Canadian and Air Canada are lobbying in favour of this option.

The small communities will be served only where it is profitable to do so, and that will hinder the free movement of people and goods. In fact, it is more profitable to provide occasional service using larger planes through these local airports than to maintain continuous service using smaller aircraft.

In our opinion, it is pointless to delve into the details of the financial impact on the Canadian travelling public.

The losers include all the firms in the air transport sector, such as travel agencies, suppliers of goods and services, airports as well as every company that is dependent on air transportation for their operations.

The Minister of Transport will have to regulate this industry on a continuous basis to prevent the major inconveniences that will arise from the monopoly. This rigid regulation, to be effective, will have to tackle many aspects like ticket pricing, minimum service to small communities, labour relations, the right to strike and lockouts as well as predatory pricing aimed at blocking potential competitors. This type of regulation will have to be very rigorous and it will go against the economic liberalization that currently prevails in our society.

• 1010

Employees will lose, since management will have the upper hand. Labour relations will have to be legislated on a continuing basis to prevent strikes that could bring the whole air transport industry to a halt. Travellers will have no alternative means of rapid transportation if a strike occurs. Furthermore, the notorious lack of speed of the Canada Labour Relations Board doesn't leave us very optimistic about the future. For example, the case involving the Intair Corporation and its employees came before the court in 1986 and a ruling was brought down only on February 25, 1997. Just recently, Mr. Paul Lordon, who is the Chair of the CLRB, declared on September 16, 1999, during a conference on federal mediation and conciliation services held in Hull, that the new Board settles its cases twice as fast as it did in the past. And yet, a few days later, the Board postponed by 90 days a decision that was to have been rendered on September 30, 1999, concerning a case that was filed in 1996.

The excruciatingly slow process turns the parties involved into hostages. These examples clearly illustrate why an article published in the New Brunswick Telegraph, on July 22, 1999, was entitled: “When justice delayed is justice denied”.

We must acknowledge that a single national carrier would not be advantageous for Canada and its citizens. The current situation, with two national carriers is, in our opinion, the best solution.

Indeed, competition between these two carriers is the best guarantee that tickets will be priced fairly and that small communities will be provided with adequate service. Furthermore, labour relations would not be subject to the negative impacts of a monopoly situation. Having two carriers prevents a complete shutdown of our transportation system in the event of a labour dispute. Let's not forget the upheaval caused by the Air Canada pilots' strike in 1998.

How can we then guarantee that there will be another player on the scene with Air Canada? We must come up with a way to help Canadian solve its financial woes or else promote the arrival of new players on the national scene. Certain regional or charter companies seem to have good potential in this area. This would be a better alternative than a monopoly situation. We don't understand why the Minister of Transport gave up so easily following the setback suffered by ONEX in court.

Finally, we all witnessed the confrontation between Air Canada, Onex and the Minister of Transport over the last few months. This confrontation had all the makings of a real election campaign. Promises and figures were flying every which way. We understand that time is of the essence but it is high time we figured out what the real impact of the merger between the two national carriers would be.

This is why we really like the solution proposed by Jean Chrétien on December 12, 1992, in Vancouver and which was reported in the Vancouver Sun. In a speech dealing with the possibility of a merger between Air Canada and Canadian, the Prime Minister had roundly criticized the creation of a monopoly situation and instead said that he would favour creating a committee of experts to advise the government on the issue. Seven years down the line, it is high time to walk the talk. Air transportation is essential to Canada and this industry deserves better than hasty decisions.

As far as the Official Languages Act is concerned, let us first examine the present situation. According to the Act that privatized Air Canada, the company must comply with the provisions of the Official Languages Act. Nevertheless, Air Canada is currently before the federal court battling to have its regional carriers exempted from the Official Languages Act.

As for Canadian, no legal obligation to provide service in the two official languages exists, for either its own activities or those of its regional carriers. The presentation that the Commissioner of Official Languages made before you on November 2 drew an adequate picture of the stakes involved, in terms of both the minimum respect for clients and the importance of the Canadian linguistic duality. The Commissioner stated that Parts IV, IX and X of the Official Languages Act should continue to apply to Air Canada as well as its regional carriers and other subsidiaries.

• 1015

The statement made by the Deputy Minister of Transport, Louis Ranger, reported by the Association de la presse francophone, threw cold water on this. He emphasized that it was not the intention of the Minister of Transport to subject the new regional carriers to the Official Languages Act. This statement is unacceptable and constitutes an affront to francophones in Canada. Acting on this intent would be very harmful to Canadian unity. We recommend that any federal Minister of Transport consult the Minister of Canadian Heritage on this matter before taking any action.

As for the Official Languages Act, we subscribe to the position held by the Commissioner. As she mentioned, it is a matter of respecting clients.

However, we do feel that Air Canada and its regional carriers should be obliged to comply with Part V of the Act, which deals with language of work, as well as Part VI, which deals with the participation of French-speaking and English-speaking Canadians. Considering that this act was passed 30 years ago, it's about time that we met the equity criteria.

Indeed, we believe that all national carriers and their regional affiliates should be subject to the requirements of Parts IV, V, VI, IX and X of the Act.

The lack of enforcement provisions found in the Official Languages Act creates another problem. We hope that the government will give the Act more teeth. Another option that the Canadian government could take would be to add compliance with the Official Languages Act as a criterion for allocation of international routes. Minister Collenette wanted to use this carrot to put a limit on the excesses resulting from a potential monopoly. Why not use it to promote respect for official languages?

On behalf of the Association des gens de l'air du Québec, I would like to thank you for your attention and for your invitation to participate in your proceedings. Thank you.

[English]

The Chairman: Mr. Martel, I want to thank you for your presentation, which was entirely germane to the issue this committee is studying. You've obviously worked very hard to put together your report, and we appreciate what you've presented to us today.

Just on the subject, in the first half of your presentation you mentioned the importance of the two-airline policy and of trying to help the other airline—Canadian specifically—by doing the things that would be necessary in order to help them stay in business. Has your association discussed the 10% rule on individual ownership and the 25% foreign investment rule? What conclusion might you have come to on those two issues?

Mr. Serge Martel: Yes, we did talk about the 10% rule and the 25% rule, not in this presentation, but in previous presentations. We think the 10% rule applied to Air Canada was a good limit that was imposed on Air Canada. It should also be done that way for any other national carriers so that nobody would effectively control those carriers.

As for the 25% ownership rule, it's pretty hard for a foreign carrier to not have the tendency to take advantage of that 25% ownership of the company, except maybe if that carrier came from overseas. If that 25% ownership of the company were raised, we would probably in fact see a control of the company. Those companies—I'm not pointing at just AMR here, but at any carrier south of the border—would probably have the tendency to look at the nice routes that Canadian or Air Canada would have with the United States. So we would recommend that those rules not be changed.

• 1020

The Chairman: Thanks, Mr. Martel.

Ms. Meredith, please.

Ms. Val Meredith: Thank you, Mr. Chair, and thank you, Mr. Martel.

Looking at your presentation and having listened to you, you make a comment that it seems to us that the size of the market is not a major factor in the present crisis. If the market can handle two carriers, why are we in this situation in which one carrier is not doing so well?

Mr. Serge Martel: As I said before, Canadian got into this situation because of its financial problems and the series of mergers that happened in the 1980s. After that, you had a drop in the market in the early 1990s. Why are we here? As a committee, I think this was all triggered this summer by the fact that Parliament thought it was justified to invoke section 47.

Ms. Val Meredith: Are you saying the crisis was started by the government invoking section 47?

Mr. Serge Martel: We don't believe it was provoked deliberately on the part of the government. I think the intentions of the government were probably good intentions. They probably thought it was the best solution to solve the crisis at the time. But the way it evolved, it took on a totally different aspect.

Ms. Val Meredith: But you are admitting there was a crisis before the government moved in and made any decision, which means I'm back to the same question. Why are we in this situation if the market can handle two airlines?

Air Canada's debt load is higher than Canadian's. It's not that we have one healthy airline that hasn't any debt load. I know you acknowledged that when Air Canada came onto the privatization scene, the government and the taxpayers of Canada gave them basically a free and clear airline in order to compete. That's not the case today. We've heard from the president of Air Canada and from others that Air Canada actually is carrying not a light debt load themselves.

The reason I'm doing this is that I'm hearing from your presentation that you support the two-airline policy. If the two-airline policy is possible, what has to happen in order that they can make a go of it? You're saying the size of the market isn't a major factor. What is? What do we have to consider in restructuring?

Mr. Serge Martel: Obviously we'd prefer the two-airline policy, but that doesn't mean this is going to be happening. The way we could take Canadian out of that situation could be by an infusion of money from either the government or some private enterprise. But we obviously think that for the employees, for the consumers, and for the small communities, competition has been a good solution.

As far as the financial aspect of it is concerned, you were talking about the debt load of Air Canada and the debt load of Canadian. Canadian should ask themselves about when they closed the base in Montreal, for example. They left all the eastern part of Canada—Quebec and the Maritimes. Would it be that this was triggered by the fact that their load factor went down? If they had stayed in the market, maybe they would have succeeded a little more than they did.

Ms. Val Meredith: If we were to stay with the two-airline policy, should the government then control what part of the market each airline gets to fly in? Should the government control whether or not there's a shared domestic market? Should we put a limit on the seat capacity that each airline is placing in the marketplace? How do you foresee the government restructuring this in order to control what some would call predatory practices that interfere with the market being large enough to handle two carriers?

• 1025

Mr. Serge Martel: I think you're talking about re-regulating the industry in a certain respect. Right now, through the National Transportation Agency, some routes are already attributed to some specific carriers. I'm looking at Asia for Canadian and Europe for Air Canada. That regulation is already there. We know Air Canada would like to get some routes to Asia, so already there's some regulation in that respect. If we have to re-regulate the industry in order to save jobs and save one airline and privilege the competition, I think we should do so.

Ms. Val Meredith: Thank you.

The Chairman: Thanks, Ms. Meredith.

Mr. Dromisky, please.

Mr. Stan Dromisky: Thank you very much, Mr. Chairman.

I'm just following through on Ms. Meredith regarding deregulation versus regulation. I get the feeling from your report that you're asking the government to really come forth with a plan whereby a deregulated aviation industry is going to be scrapped and we come in with a multitude of regulations to control the major carrier plus all of the regional carriers, whether they be allied as part of an association with the dominant carrier or whether they are independent. You can't have all these rules and regulations just applicable to a monopoly or just to those regional carriers that are associated. These rules and regulations would have to apply to everyone, so I'm really concerned about that.

Let's take a look at Air Canada's model, the model they are presenting at the present time. Do you feel many of your concerns would be addressed and probably would not be major concerns if that model were applied to serving customers in Canada?

Mr. Serge Martel: Are you talking about the proposal of Air Canada?

Mr. Stan Dromisky: Yes, right.

Mr. Serge Martel: Okay. First of all, you were telling me about regulations in the case of a monopoly. The Air Canada proposal is actually the emergence of a monopoly in Canada. Let's face it, it's going to be a monopoly with them buying out Canadian. What are they going to do with Canadian? Time will tell. With them being in a situation of monopoly, by being the government you will have to re-regulate the whole system a lot harder in terms of protecting the Canadian citizen.

The solution that was proposed by Onex was exactly the same. We were looking at a monopoly. For sure, we'd like to have two competing carriers. But if the monopoly is the only solution, eventually you ladies and gentlemen will have to probably vote through some very unpopular law in order to prevent labour disputes or any dumping in terms of pricing.

If there's another carrier that wants to do a route between Montreal and Toronto, for example, but that carrier doesn't have the structure to do more routes and is trying to do those routes with low fares, most probably the big guy is not going to let that little guy start into the market.

Mr. Stan Dromisky: I'd like to ask you a question pertaining to the Official Languages Act.

• 1030

With many of the regional carriers there are some small planes carrying passengers and they have no flight attendants on board. They use tapes. Even some of them that might have one flight attendant on board still use a tape. They give messages regarding safety and blah, blah to the customers all sitting before the plane takes off. On many of these tapes, the languages are given in a very specific order.

Now, I know what the regulations are regarding the act. There are carriers that fly up north. For instance, where maybe the vast majority of the people flying on the planes speak kind of a dialect of Ojibway and Cree called the Ojicree language, the tape could have Ojicree first and not English or French and then the other language could follow. Would you agree with that? Is that possible?

Mr. Serge Martel: To be honest with you, I've been out of the Arctic since 1988. We used to give our safety speech to the passengers in both English and French in northern Quebec and in English in the Northwest Territories.

I would agree that when a carrier does have a vast majority of customers on board that have either the Cree language or Inuktitut, I would for sure look at having those tapes put on board the aircraft. But that's for sure it's going to increase the amount of security.

As an example, Canadian North, at the time when they were doing Montreal-Frobisher, at one point—I think it was around 1985 or 1986—started to hire Inuktitut flight attendants to give the safety instructions on board and do the service. It's the same thing, I think, with First Air up north. When it's possible they'll have an Inuit flight attendant or Inuit personnel.

The Chairman: Thanks, Mr. Dromisky.

Mr. Guimond, please.

[Translation]

Mr. Michel Guimond: Mr. Martel and Mr. Alain, thank you for your presentation, and I would like to congratulate you for submitting a document in Canada's two official languages. Some corporations or organizations that are wealthier than you are incapable of finding either the time or the money to have their briefs translated. I recall that Canadian Pacific, with assets of several billion dollars, was one of the corporations that didn't find time to have the French version of its document translated.

I would like to ask a question about official languages. Minister Collenette appeared before us on October 26. In his framework policy presentation, he said:

Fundamental to the identity of Canada is its linguistic duality. It is a reflection of Canada's unique culture and values that Canadians be able to rely on the national air carrier

—on the national carrier—

for service in either official language.

and, in bold, he states:

The government will ensure that the Official Languages Act continues to apply in the case of Air Canada or any future dominant carrier, and that the Act is effectively implemented.

But when it comes to regional carriers, the question remains. Mr. Ranger's comments were not very reassuring.

I believe that your association has a very clear position and that it ties in to the request made by the Commissioner of Official Languages.

You stated in your presentation that the Commissioner painted an adequate portrait of the stakes involved. Without wanting to get into an argument over semantics, could we say that the choice of the word “adequate” indicates that you fully support the request or recommendation made by the Commissioner of Official Languages to the government, and that this fully reflects your concerns?

Mr. Serge Martel: The Commissioner of Official Languages had talked about Part IV, which deals with the language of communication with users, as well as Parts IX and X.

• 1035

As stated in our brief, the Association des gens de l'air feels that Part V, which deals with the language of work, should apply in designated areas. We have to realize that we cannot have these services throughout Canada. In Toronto or in Vancouver, the language of work will probably not be French. We do believe, however, that it is important to at least include it and perhaps make some changes.

Part VI is also very important for our association. As you know, the Association des gens de l'air was created initially to pursue the right to use the French language in air traffic communications. The second objective of our association is to look after the socioeconomic interests of the francophone community. Although we may be called the Gens de l'air du Québec, we have always wanted to talk about francophone society in the broad sense, including all francophones in Canada.

Part VI stipulates specifically that French-speaking and English-speaking Canadians are to participate equitably in industries subject to the Official Languages Act. Moreover, the 1997 report published by the Commissioner of Official Languages talks about the participation of francophones and anglophones. With perhaps the exception of the West, where we know that the clientele is only English-speaking, the ratios are generally acceptable.

However, the airline industry has not followed the same trend. Even though Air Canada, for instance, is subject to the Act, francophones account for only 17% of the work force. This is the figure that was given in the 1997 report. It is essential that Part VI, which is of considerable importance, be added.

Mr. Michel Guimond: I'll come back to this question on the second round.

I have a question relating to the proposals. One is by Onex, and provides for amalgamation of regional carriers. The second is by Air Canada, which provides for a similar amalgamation. Last week, Mr. Deluce and Mr. Lizotte suggested creating a new Regco. Do you feel that, in its final report, the committee should ask that the Official Languages Act apply to any new regional carrier created through the merger of Air Canada and Canadian Airlines?

Mr. Serge Martel: But of course, Mr. Guimond. You are quite right. Out of respect to French-speaking communities, we need legislation that requires regional carriers to comply with the Official Languages Act. Why do we need it? Because there are francophone communities all over Canada. Francophones don't just live in Quebec; Quebec is not a ghetto. There are francophones all over Canada—in the Maritimes, in Manitoba, in Saskatchewan, in British Columbia, and everywhere else in Canada.

Therefore, we believe it would not only be natural but also essential for the government to immediately define the rules of the game for a regional carrier that could be created once the airlines merge. And let's remember that a dominant national carrier means a dominant regional carrier.

[English]

The Chairman: Thanks, Mr. Guimond.

Mr. Sekora, please.

Mr. Lou Sekora: Thank you, Mr. Chairman.

One thing in your presentation I gathered from listening was that you're very eager to retain the 10%. Am I correct in that?

Mr. Serge Martel: Yes, we would want it.

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Mr. Lou Sekora: Okay. Then you went on to the infusion of money by a private entrepreneur. How do you get both? Tell me that, because I don't think it's possible. If you want the 10%, unless you open up the 10%, you can't get an infusion from entrepreneurs unless the government goes in and bails them out.

Mr. Serge Martel: Well, I think the government got into Air Canada for many years. Canadian went out on its own for quite a while. Would it be feasible through tax breaks, through legislation, or through infusion of money to save that company?

Mr. Lou Sekora: So what you are saying—

Mr. Serge Martel: But—there's a but—if you put money into it, let Canadian respect the official language law.

Mr. Lou Sekora: Yes, I realize that, but I've got really mixed feelings. The fact is that somehow you're saying now the 10% should stay, but the federal government should get involved financially, either loaning them money or propping them up or whatever it is. That's subsidy, and I don't think our Canadian people across Canada—I don't think you can find a single person who would want the federal government to bail out the airlines in any way, shape, or form.

What happens when we bail them out? I'd be totally opposed to that, but let's say we do. We're here a year from now, six months from now, a year and a half from now, two years from now asking you the same question. What will you say then? Do you think the same problems will not arise? Unless we go ahead to both airlines and say here's all the money you want, we'll bail you out totally, you won't have any bills at all, do you think that eventually, sooner or later, for one reason or another, they're not going to get themselves into trouble and be in the same situation?

Mr. Serge Martel: It depends on their management.

Mr. Lou Sekora: That's right, so then what you're saying to the federal government is also manage them so they don't get themselves into this kind of trouble. To me—I'm totally opposed. Private money, yes, as much as you want, providing it's Canadian-controlled; but I'll tell you, as far as the government going in to bail them out, I'm totally opposed.

As far as language is concerned, I fly across Canada and other parts of the country quite often, and yes, there's the English and the French, and to me that is fine. I think that's a great way to have it, and any other language that may come aboard because of the type of people we're transporting. But if you're saying it should be only English or French, I think this is wrong. I think it should be a mixture.

Mr. Serge Martel: Yes, I do agree, but as you saw in our presentation, we gave another option as well. The option was to privilege some regional carriers that would not be part of Air Canada to eventually have a connection with some charter companies that are willing to do that. And it seems that in the Regco presentation here there was some charter company ready to take the pole from Canadian. That would be an advantage, that kind of project. We gave another solution as well.

Mr. Lou Sekora: So you're mainly talking about Quebec. Tell me something about Quebec. I've been many times, but I've just flown in and out; I go in for a few days and out. But tell me, what do the airlines use for a language—just French, or do they use English and French?

Mr. Serge Martel: They use English and French, sir—or French and English.

Mr. Lou Sekora: Yes, I suspect it would be French first and then English in Quebec, and that's fine.

Mr. Serge Martel: But we use both.

Mr. Lou Sekora: But you use both, okay. And in your regional airlines, what language do you use—both?

Mr. Serge Martel: Both.

The Chairman: Thanks, Mr. Sekora.

Ms. Desjarlais, please.

Ms. Bev Desjarlais: I would like to follow actually on Mr. Dromisky's question, because he brought this up at another presentation as well and maybe I misunderstood. If I'm wrong, go ahead and ask again, Stan.

I sort of got from his question that he was wondering if it is okay to use another language first other than French or English, such as Ojicree. Is it a key issue with anyone whether or not Ojicree or Cree would be used before French or English?

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Mr. Serge Martel: We have nothing against using the languages in the place where you're going to put it. We're not talking about this; we're talking about just using both official languages.

Ms. Bev Desjarlais: Okay.

Mr. Serge Martel: It's just that.

Ms. Bev Desjarlais: Yes.

Mr. Serge Martel: Some airlines don't even respect that, unfortunately.

Ms. Bev Desjarlais: For the record, what I've seen for the most part is that both do get used, and in other places in Canada too, where French wouldn't necessarily be prevalent. I've seen it used there as well. So if there are areas where we can certainly encourage use of both languages, I think there's nothing wrong with that.

The other question I have is this: how long has your organization been in place? I apologize if you gave this information at the beginning. I missed the first part of your presentation.

Mr. Serge Martel: L'association des gens de l'air started in 1975. This year is going to be the 25th year of existence of the association. The first flight of l'association des gens de l'air, if you remember it well, was because we were not allowed to speak French in air-to-air or air-to-ground communication at the time. That was the first time.

Ms. Bev Desjarlais: Okay. That was anywhere, including within Quebec, that you were not allowed to use it?

Mr. Serge Martel: No. Actually, at the time we couldn't use French in Quebec in aviation transmission, but since then.... Ottawa now has a bilingual service, since 1994-95, I think, and maybe earlier than that. At Ottawa and all airports in Quebec, you can fly IFR, instrument flight rules, and over Quebec, using the French language if you want.

Ms. Bev Desjarlais: In the first part of your presentation, you promote the use of French in aviation. Are you talking about aviation nationwide, worldwide, within Quebec, or in prevalently French-speaking areas?

Mr. Serge Martel: I think the official language law would apply in Vancouver as well as in St. John's, Newfoundland. There was a presentation made by Mr. Claude Taylor at the joint committee of the Commons and the Senate in 1981, in which he said that French Canadians are now moving around in Canada a lot more and that's why we have to get bilingual service on each and every flight of Air Canada. That was said in the Senate at the time.

We do believe that the official languages law is not a law that applies just in Quebec but everywhere in Canada, and I think it should be applied everywhere in Canada.

Ms. Bev Desjarlais: So what you ultimately would like to see, whether or not we have the Air Canada Act or anything else, is something put in place that ensures the use of both official languages throughout.

Mr. Serge Martel: I think the problem here is that the law exists but doesn't have any teeth. You need teeth. I usually give the example of a police officer, where you go on a red light and the police officer stops you, but the only thing the police officer can give you is a warning. You're in a rush, so at the next red light, what are you going to do? Probably you're going to pass on the red light again. There's no coercive way of applying that law.

That's why we suggest that any national carrier should care about the law and apply it. One of the coercive ways to oblige those companies to obey the law would be to control the international routes—and believe me, they want those international routes.

Ms. Bev Desjarlais: Thank you.

The Chairman: Thank you, Bev.

Mr. Casey, please.

Mr. Bill Casey: Thank you.

Thank you for coming here today. As I recall, you're a pilot. You were at the ad hoc committees. You made a presentation.

Mr. Serge Martel: Yes, I'm a pilot.

Mr. Bill Casey: Who are you a pilot for? What company?

Mr. Serge Martel: Air Nova.

Mr. Bill Casey: Have you been following the question about the divestiture of the regional airlines? If there is only one dominant carrier, should the regionals be divested or should they stay part of the dominant carrier?

Mr. Serge Martel: I think your question is right on the money.

Sorry about the expression. I think it's the right one.

Mr. Bill Casey: Yes, that's the right expression. It's right on the money, maybe in more ways than one.

• 1050

Mr. Serge Martel: We have to look at the tendency in the industry. If you looked at the Globe and Mail from last month, you would have seen an article in the business section showing that Delta Airlines just bought COMAIR, which was a regional carrier at the time. I think it was 30% owned by Delta, and Delta bought the rest of the shares.

The tendency in the world, in the United States anyway, is not to get rid of the regionals; it's to get the regionals within the main line. Look at Lufthansa, for example, at the Lufthansa connector. It's the same way.

Mr. Bill Casey: But you're saying that's not a good thing?

Mr. Serge Martel: It's a good thing.

Mr. Bill Casey: It is a good thing?

Mr. Serge Martel: I think it's a good thing. I read the presentation done by Regco.

Mr. Bill Casey: Right.

Mr. Serge Martel: There you're eventually looking at a monopoly in terms of a national carrier and a monopoly in terms of regional carriers. Looking at the comments and the eight conditions, I must admit that if those conditions are given, I'll start to believe in Santa Claus, and I'll know for sure that Santa Claus lives in Ottawa.

Mr. Bill Casey: Earlier in your presentation you said you believe in a dual airline process. If there is only one now...the Competition Bureau said divestiture would provide competition. You're with Air Nova, so if it were divested you would be removed from Air Canada. The Competition Bureau said that would provide competition in lieu of a second airline, but you don't agree with that.

Mr. Serge Martel: Look at the tendency, as I said before. A connector has to be strongly linked with a national carrier.

Mr. Bill Casey: A feeder, right?

Mr. Serge Martel: I don't think Canada could make a 180° turn away from that tendency. What would be the plus for a customer like you, for example, to take one airline compared to the other? What would be the best...? We're not too sure that this situation of two regional carriers and one national carrier would really work.

Mr. Bill Casey: Going back to the dual airline policy, which I think most consumers would rather have...they'd rather have two airlines, with competition. Otherwise we're going to have a mountain of regulations. It's either regulation or competition, one or the other. If no one is out there to propose a second airline, what can we do to encourage that?

Mr. Serge Martel: You removed one of the possibilities that we put in our document, which would be to save Canadian Airlines. That saving would have to be done through certain criteria, I would suppose. That's why we were strongly suggesting to this government to look at it a little more closely instead of making a rushed decision—maybe have a board of experts. At the chamber of commerce in Montreal, a specialist from McGill University gave us all kinds of scenarios. I don't know if those people have been heard here, but it would be—

The Chairman: Yes.

Mr. Serge Martel: Yes?

It would be advantageous, I think, for Canada to at least look at that possibility. If you don't have any choice but to go to a monopoly, go to a monopoly, but you'll have to regulate it and make sure that you don't miss anything.

Mr. Bill Casey: Right.

Some of the presenters have said that the airline industry in Canada is not in crisis, that just Canadian Airlines is in crisis. Do you agree or disagree with that? In the Canadian airline business, is the structure we have now in crisis and should it be turned inside out? Or is it just one airline that has a financial problem?

• 1055

Mr. Serge Martel: I think Canadian Airlines has financial problems. That's what triggered the whole situation, the whole saga we've been living, since August 24—

Mr. Bill Casey: The thirteenth.

Mr. Serge Martel: Sorry...since August 13.

Mr. Bill Casey: Thanks very much.

The Chairman: Thanks, Mr. Casey.

Mr. Guimond, finally.

[Translation]

Mr. Michel Guimond: To come back to Mr. Dromisky's question, which was also raised by Ms. Desjarlais, I would say it is a matter of opinion. If you fly between Vancouver and Hong Kong, safety- related announcements are made in four languages: English, French, Chinese and Mandarin. Depending on passenger make-up, the airlines will make these announcements in four, eight or even ten languages, because they concern safety and have to be understood by passengers.

This leads me to my question for the witness. I want his opinion on another point to consider for our final report. If we state that regional carriers should be subject to the Official Languages Act, shouldn't we also indicate that the languages should be known well enough to adapt messages to events occurring on board? Let me explain.

Though many Canadians appear to think otherwise, you will agree that a flight attendant's primary role is not to provide meals and drinks. Their primary role is to ensure the safety of passengers.

I also gave an example to the Official Languages Commissioner; you may have seen a replay of the meeting. During a Canadian Regional Airlines Fokker F28 flight between Toronto and Quebec City, a light signal showed that the undercarriage had not come down. So before the pilot could have the control tower confirm whether the undercarriage was in fact down, he asked the flight attendant to begin emergency landing procedures.

Unbelievable as it might seem, the steward did not speak enough French to tell passengers to take off their shoes, remove their dentures and bend forward to hug their knees because there could be an emergency landing. The passenger in seat 1-C had to translate all the instructions for French-speaking passengers. I think that this is completely unacceptable. I also don't believe that such instructions should be provided on tape.

I would like your comments on this.

Mr. Serge Martel: I'll make one comment first. This was a flight from Quebec City to Montreal, and I believe a complaint was made. In fact, the complaint was made to the Association des gens de l'air du Québec by the complainants some time ago. As we know, Canadian Regional Airlines is not subject to the Official Languages Act. This is one incident that could have been extremely serious.

As we know, many passengers on that plane did not speak English, yet all safety-related instructions were provided in English only. In the opinion of the Association des gens de l'air, safety is an important factor that should be considered in applying the Official Languages Act. It is not just a matter of respect.

When there is an emergency in a plane, passengers are frequently much more nervous than crew members, who are of course better prepared. People who are nervous find it even more difficult to understand a second language, and therefore fail to understand safety-related instructions. I therefore believe that this bill should include a requirement that both official languages be used, for safety as well as other reasons.

Obviously, we cannot use the languages of all ethnic communities in Canada, but Canada does after all have two official languages—English and French. We recommend that both be used for safety reasons.

• 1100

The complaint I mentioned above also focussed on another point. It was submitted to Commissioner Goldbloom a year and several days ago. Mr. Goldbloom referred it to the Department of Transport, since Canadian Regional Airlines was not subject to the Official Languages Act. To date, the complaint has still received no response from the Department of Transport.

Mr. Michel Guimond: Mr. Martel, I would like to thank you for your answer as well as for something that is implicit in all your remarks: you would also like to see the 1.5 million francophones outside Quebec receiving services in their own language. Thank you.

[English]

The Chairman: Thanks very much, Mr. Guimond. You make a good point.

Mr. Martel and Mr. Alain—Mr. Alain had an easy morning, but he did all the work behind the scenes—thank you, gentlemen, for your presentation. Again, as I say, it is very relevant to the work we're doing. We appreciate your input and thank you for answering our questions.

Colleagues, we're adjourned until 3:30 this afternoon.