TRAN Committee Report

SUPPLEMENTARY REPORT

ENHANCING THE EFFICIENT, AFFORDABLE OPERATION of CANADA’S AIRPORTS

Tabled by the Conservative Members of the Standing Committee on Transport, Infrastructure and Communities

February 9, 2023

INTRODUCTION

Conservative Members of Parliament on the Standing Committee on Transport, Infrastructure and Communities would like to thank the Committee, its staff, analysts and number of witnesses who shared their valuable insights concerning how to reduce red tape and costs on rural and urban airports in Canada.

While the Conservative Members support general direction of the report, we believe the recommendations of this report do not go far enough in addressing the urgent need to reduce costs for travellers and reduce red tape that is exacerbating delays at Canadian airports and the compounding toll these are having on travellers, airlines and airports.

We would further note that the Government’s pandemic travel measures, including vaccine mandates and the ArriveCAN app, are responsible for the loss of staff, a decline in service levels and the impacts on airports, airlines and the tourism sector that that has yet to recover.

As a result, we are tabling this supplementary report with four recommendations.

COMPREHENSIVE REVIEW

While the Report recommends a Costing Review, which Conservative Members support, we also believe there should be a comprehensive review of airport governance, operations, training, accountability and fee structures. This should better inform where the Government of Canada makes investments to improve airports and the federally-regulated aspects of air travel in Canada.

The culmination of witness testimony on governance, operations and fees demands no less.

COMPETITION REVIEW

More competition is essential to reducing the costs to Canadian travellers.

Conservative Members believe Canadians deserve an in-depth review of what the Government of Canada can do to increase competition in the sector.

Conservatives believe the Government of Canada needs to codify the regulatory burdens, red tape and costs that are hindering new potential carriers from entering the Canadian market and remedy them. We believe a competition review is needed throughout the system ---both large international airports and rural airports and markets.

It is vitally important as this Committee has heard from witnesses who commented on the increasing bleed of Canadian travellers crossing the border to take less expensive flights from nearby U.S. airports. These tickets are not contributing revenue, fees or taxes to the Canadian system and are increasingly a missed opportunity.

REMOVAL OF CARBON TAX

The Committee heard that Canadian airports, particularly smaller airports, are struggling with a number of costs. These costs include high property taxes, NAV Canada fees, terminal fees, security fees as well as federal taxes, including the carbon tax.

Up to 40% of the cost of an airline ticket goes to taxes and fees, this is uncompetitive, unsustainable, and detrimental to Canada’s tourism industry and manufacturing sectors.

A serious review of costs, which was the mandate of this study, would not be complete without a look at the federal carbon tax.

In witness testimony, Mr. John McKenna, President of the Air Transport Association of Canada, cited the annual increase in the federal carbon tax as a having a significant impact on the cost of travel. In doing so Mr. McKenna corroborated the testimony of others, including airlines who cited federal taxation as a barrier to growth.

ELIMINATION OF THE ARRIVECAN APP

Among the contributors to frustration experienced by Canadian air travellers in the past year, the problems associated with the Government of Canada’s insistence on the mandatory use of the ArriveCAN app were an avoidable burden.

While the ArriveCAN app was made optional in late summer 2022, the Conservative Members of the Standing Committee on Transport, Infrastructure and Communities understand that it has fallen into disuse and recommend that this costly and problem-plagued app be permanently eliminated.

RECOMMENDATIONS

Conservative Members recommend the following actions as a supplement to the recommendations of the Standing Committee’s Report on Reducing Red Tape and Costs in Canada’s Airports:

1. Comprehensive Review of Operations and Fees
2. That the Government of Canada should conduct a comprehensive review of airport governance operations, training, accountability and fee structures.
3. Competition Review
4. That the Government of Canada should conduct a thorough review of our competitiveness in attracting potential new carriers to the Canadian market.
5. Remove the Federal Carbon Tax from Air Travel
6. That the  Government of Canada reduce the costs to Canadian passengers, support rural, remote and northern air travel, and enhance the competitiveness of the Canadian carriers compared to international competitors, by removing the federal carbon tax from air travel.
7. Permanent End to the ArriveCAN app
8. That the Government of Canada permanently remove the use -- optional and mandatory -- of the ArriveCAN app.