THE STANDING SENATE COMMITTEE ON TRANSPORT AND COMMUNICATIONS
EVIDENCE
OTTAWA, Wednesday, May 17, 2023
The Standing Senate Committee on Transport and Communications met this day with videoconference at 6:46 p.m. [ET] to study the subject matter of those elements contained in Division 2 of Part 3, and Divisions 22 and 23 of Part 4 of Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023; and, in camera, to consider a draft agenda (future business).
Senator Leo Housakos (Chair) in the chair.
[Translation]
The Chair: I am Leo Housakos, a senator from Quebec and chair of the Standing Senate Committee on Transport and Communications. I would like to invite my colleagues to introduce themselves, starting on my left.
[English]
Senator Simons: I’m Paula Simons, Alberta, Treaty 6 territory.
[Translation]
Senator Miville-Dechêne: Senator Miville-Dechêne from Quebec.
[English]
Senator Manning: Fabian Manning, Newfoundland and Labrador.
[Translation]
Senator Clement: Bernadette Clement from Ontario.
[English]
Senator Harder: Peter Harder, Ontario.
Senator Quinn: Jim Quinn, New Brunswick.
Senator Cardozo: Andrew Cardozo, Ontario.
Senator Dasko: Donna Dasko, Toronto.
The Chair: Honourable senators, we are meeting to continue our pre-study of certain elements of Bill C-47, the budget implementation act — or BIA — and we are pleased to have with us this evening the Honourable Omar Alghabra, Minister of Transport. Thank you, minister, for your availability. You are always accessible to this committee and we appreciate it. Also joining us are officials from Transport Canada: Serge Bijimine, Assistant Deputy Minister, Policy; Colin Stacey, Director General, Air Policy; Tamara Rudge, Director General, Surface Transportation Policy; and Alain Langlois, Senior General Counsel and Executive Director, Transport and Infrastructure Legal Services.
Minister, welcome, and welcome to your officials. We will give you a few minutes for opening statements and turn it over to senators for Q&A.
[Translation]
You have the floor.
[English]
Hon. Omar Alghabra, P.C., M.P., Minister of Transport, Transport Canada: Good evening, friends. Thank you very much, Mr. Chair. It is great to be back with you here.
Thank you for the opportunity to talk about some of the proposed measures for our transport sector in Bill C-47, the budget implementation act.
As you mentioned, Mr. Chair, I’m joined today by representatives from Transport Canada: Serge Bijimine, Colin Stacey, Tamara Rudge and Alain Langlois.
A strong transportation system is fundamental to keeping people and goods moving, and to Canada’s overall economic success.
[Translation]
A strong transportation system is vital to Canada.
[English]
Bill C-47, once passed, would strengthen the protection of air travellers’ rights and help make our supply chains more efficient and resilient.
In 2019, we were the first government in Canada’s history to put in place a bill of rights for air passengers. This bill of rights gave Canadians important protections against flight delays and cancellations. Shortly after the bill of rights came into force, the COVID-19 pandemic hit our air sector incredibly hard and showed there were gaps in the regime.
As the air sector began to quickly recover, passenger volumes surged. We saw that the sector struggled in coping with the significant increase in demand, resulting in many disruptions here in Canada and around the world. We also saw an increase in passenger complaints at the Canadian Transportation Agency, or CTA.
We learned lessons from the experiences of passengers and I committed to Canadians, including during my presence here last time, that I would improve passenger protections.
Bill C-47’s proposed amendments to the Canada Transportation Act would strengthen air passenger rights to make our regime the strongest in the world.
These changes will put the onus on airlines, hold them even more accountable and simplify the complaints process to help deal with the current backlog.
For example, air carriers would be required to pay mandatory compensation to travellers for all disruptions, no matter the cause — except for a very limited number of cases, which will be defined in regulations. This means there will be no more loopholes where airlines can claim that a disruption is caused by something else outside of their control or for a security reason, when it’s not. Additionally, air carriers would be required to deal with passenger compensation claims within 30 days.
These legislative changes would also allow the Canadian Transportation Agency to establish requirements for delayed baggage. These changes would simplify the way that the Canadian Transportation Agency deals with complaints to ensure that Canadians’ concerns are addressed quickly.
The Canadian Transportation Agency would also be allowed to recover the cost of air passenger complaints from airlines, which would incentivize airlines to address complaints directly with travellers as quickly as possible.
Companies that don’t comply with the regulations could now be fined up to $250,000, a significant increase from the previous amount of $25,000 — which, by the way, was brought up the last time I was here at committee.
There is a significant power imbalance between airlines and their customers where customers can suffer considerable consequences if a service they purchased isn’t delivered properly. When a passenger purchases a ticket, that is a financial transaction between the airline and the passenger. As a result, it is up to the airline to uphold their obligations to the passenger for delays and cancellations.
That doesn’t mean we are not holding other players in the sector accountable. Budget 2023 also outlines our commitment to requiring data sharing among all players in the air sector, from airlines to airports. More data sharing ensures more transparency and, therefore, more accountability for everyone.
I believe there is a role for government in fixing that power imbalance and I believe the legislative amendments in Bill C-47 will help strengthen the protection of passenger rights.
Our transportation supply chains play a critical role in our economy and they have been put to the test in recent years. Canadians deserve supply chains that can deliver the essential goods they need on time. That’s why I convened a National Supply Chain Task Force and welcomed its final report on how to improve the efficiency and resilience of our transportation supply chains.
Bill C-47 includes amendments to address some of the recommendations in that report. These measures would compel data sharing by shippers accessing federally regulated transportation services. This would help to improve the efficiency of our existing transportation infrastructure.
Also, the bill includes a temporary extension of the rail interswitching limits in the Prairie provinces. This is expected to enhance options for shippers and would enable greater competition in Canada’s freight rail sector. It will also help us assess the impacts of interswitching on a pilot basis and inform our future actions on a national basis.
If passed, Bill C-47 includes important measures to further protect the rights of Canadian air travellers and to strengthen the efficiency and resilience of our transportation supply chains and trade corridors.
Mr. Chair, thank you for your time. I’m happy to answer any questions that committee members may have.
The Chair: Thank you, minister. I’ll start off our Q&A.
There is a lot in Bill C-47, minister. As you know, our committee has had a limited amount of time to deal with an important part of it — namely, the bill of rights.
This committee has heard from passenger advocates and from the airline industry. As you know, a few months ago we had a special inquiry on the difficulties faced by the airline industry and by travellers in this country. You appeared before the committee.
We’ve heard now from a number of people that the government has dropped the ball. We had a first shot at a passenger rights bill — which clearly wasn’t working, by your own admission — and now we’re taking a second crack at it.
We’ve heard testimony that security and customs are not being efficient. We’ve heard that the cost of our travel in terms of our airports and operations is being downloaded to the customers.
Now we have an opportunity to fix this the second time around. During your previous visit before our committee, I asked the last question. I asked if you would get this new bill of rights to our committee early enough so that we can have a robust study, hear from stakeholders and make a worthy contribution as parliamentarians in order to have the best possible result.
As is often the case in Parliament with an important bill like this, instead of stand-alone legislation, where we can do an in‑depth, deep dive on behalf of citizens, we find ourselves dealing with an omnibus bill. It is stuck in there and we’re racing against time. All my colleagues know that it would be irresponsible for us to delay the bill, because there is a huge public outcry for it.
Minister, why couldn’t we have gotten this done more quickly and had it brought to Parliament earlier so we can do our job and do a more robust study?
Mr. Alghabra: Thank you, Mr. Chair. There is a lot in your question. If I were to respond to everything you said, I would take the rest of the time. I’ll focus on the final part of your question.
First of all, when it comes to how quickly this bill has been put together, in relative terms, this happened incredibly fast. Governments tend to take time to study, consult and review. Because of the sense of urgency and the lessons learned from COVID and the recovery from COVID, we felt it was important to act quickly. I argue that we acted incredibly quickly.
I hear you about the fact that, ideally, you would have liked for this to be stand-alone. It’s not uncommon for budget bills to contain administrative law changes, which is what these amendments are. I’m grateful to you for taking the time to do a pre-study here.
By the way, there are still some bigger questions that require public policy conversation about airports and airlines that I would welcome, as I said to you last time, in terms of committee’s study and examination.
I’m happy to answer specific questions on the provisions for the bill of rights. I’m also happy to hear from you, on an ongoing basis, about other measures, amendments or changes that you think we can improve for the overall aviation sector.
The Chair: Thank you for the answer, minister. I only have a minute left in my time. With all due respect, we can’t make a contribution when we can’t amend the bill, do a robust study or give it the time it merits. With all due respect, passenger rights and the state of our airports — which you said in your statement are so important — are not just administrative issues that we shove in a BIA.
My time is up, but I suspect my colleagues will give you ample opportunity to respond to similar questions.
Senator Simons: As you know from your last visit here, minister, I am a grumpy air traveller. I want to start by asking about Prairie interswitching, as an Alberta senator.
The 160-kilometre interswitching model was in effect, as I understand, from 2014 to 2017. I’m struggling to understand what you hope to gain from this 18-month pilot. What will be the proof to you that it’s working? What do you say when CN and CPKC, as it’s now called, argue that this isn’t going to improve? If you’re shipping grains, there is a set rate. There is no real competitive advantage to switching from one Canadian carrier to the other. They argue that the real beneficiary is going to be the giant American firm BNSF, and that BNSF will, with the 160-kilometre interswitch, be able to pick up grain from places in southern Manitoba and southern Alberta, and then ship it on American freight through the United States and Mexico, and undercut the Canadian carriers.
Mr. Alghabra: Thank you, senator, for that question.
This decision was made based on a recommendation that was included in the National Supply Chain Task Force report. I promised the authors of that report that it will be acted upon. I felt there were compelling reasons.
One of the reasons we’re starting with the pilot in the Prairies, particularly, is because there are certain regions in the Prairies that don’t have options when it comes to rail. There are certain parts of Saskatchewan that only have CN and certain parts of Manitoba that only have CPKC. By testing the idea of interswitching, it creates or simulates competition where it’s not just about rates, senator; it’s also about performance, fluidity and options. It enables the shipper to have it shipped somewhere there might be another option and that the other option can deliver it faster or with better performance.
We’re going to be collecting data. Last time, we did not collect as much data as we should have. This time, we’re going to be collecting data and measuring the impact that this interswitching has. Based on the data we collect and the information we gather, we’ll make a decision.
Senator Simons: When the CTA was here before us yesterday, I had concerns — and I still have concerns — about what happens to people who are trapped, whether that’s on planes or trains, for 12, 15 or 18 hours without access to food, water or working toilets. We’ve talked about this. The response we seem to get from the CTA is that would not be dealt with in the passenger bill of rights; that it would only be for delays.
What can you tell Canadian travellers, whether by air or rail, to assure them they’re not going to be held hostage because there isn’t the staff to get someone off a plane or a train in a timely fashion?
Mr. Alghabra: Senator, let me be clear: The current passenger bill of rights has rules about how long a passenger should be on a plane —
Senator Simons: Yes, three hours.
Mr. Alghabra: Exactly.
Senator Simons: That’s not being —
Mr. Alghabra: Let me first set the stage. The rules are clear. There are sometimes exceptional circumstances, such as a massive snowstorm, when there is not a gate available for a plane to disembark, et cetera.
But in this iteration of the bill, we’re proposing the creation of a new service standard. The service standard will not only uphold the rules, but it will ensure that the airlines have a minimum treatment of their customers when customers are waiting because of a major snowstorm, et cetera.
I can assure you that the new bill will have a new standard of treatment that the airlines must uphold when their passengers and customers are waiting because of a snowstorm or any other —
The Chair: Thank you, Senator Simons, but we’re out of time.
Senator Harder: Minister, welcome. I’m the most junior member of this committee, and I take responsibility for the issues I’m going to raise with you, because some 30 years ago I was a strong advocate of user pay as part of the rebalancing of the fiscal framework.
I have two questions for you with respect to user pay. The earliest one is this: Will you assure this committee that the increased fees that CATSA — the Canadian Air Transport Security Authority — will generate will be 100% dedicated to CATSA?
That’s the first part, but my broader question is more philosophical. I think our enthusiasm for user pay has exhausted their public policy benefit. In other words, the airline sector in particular is over-reliant on user pay and therefore underperforming relative to our competitors and relative to the advantage we could attract from other airlines that see the Canadian market as horribly out of sync from a competitive point of view for landing rights, et cetera.
Are you open to reviewing the balance between user pay and general revenue? I know the Department of Finance probably isn’t. But is this a study or a piece of work that you or your department are undertaking? Because this is a really fundamental question if we want an airline sector that is competitive and successful over the long run.
Mr. Alghabra: Senator Harder, thank you for that question.
Let me address your first point. Yes, we are committed that the new increase in the fees allocated for CATSA will be designated to go to CATSA. CATSA has not seen an increase in its fees in 13 years. The last time we increased those fees was 2010. Again, during the pandemic, we saw some of the vulnerabilities and some of the capacity issues and technologies that they need to improve upon. So this was a reminder to us as a government and a country that we need to modernize CATSA. That is the purpose of this new proposal.
On your broader question, philosophically speaking, I think the user-pay model works. However, the user-pay model shows vulnerabilities when we have these types of exceptional circumstances where we no longer have users, yet we still need the system to be maintained. We saw that flaw in user pay get exposed during the pandemic.
I would welcome hearing from this committee, if you choose to do a study, whether that needs to be revisited. In principle, I think it works, but again, I will acknowledge that the vulnerabilities were exposed during the pandemic.
Senator Harder: I would dispute that it’s just the pandemic or the economic urgency that exposes this. It’s actually been exposed by living next to the United States, where the gravitational pull, economically, is to a model that is less user pay and a more generalized taxpayer base. Therefore, our competitiveness in the air sector, in particular, which is much more continental, is disadvantaged from competition.
Do you agree with that?
Mr. Alghabra: Senator, again, I’m not going to dismiss the idea of reviewing and comparing what our model looks like compared to others.
But I just want to say something: I also have conversations with our competitors. First, we sometimes need to be careful not to always compare ourselves to a market that is significantly larger than ours. They have some advantages that we don’t have.
Second, in speaking with many of our friends in the United States, they have significant challenges too. Their system is not perfect.
So I think it is worth taking time and delving deeper into this issue. I welcome what your assessment of this model is.
[Translation]
Senator Miville-Dechêne: Welcome, Minister. Yesterday, we heard from witnesses. Unsurprisingly, airline spokespeople were opposed to virtually everything you’re proposing. What surprised me most was the opposition of Mr. Gábor Lukács, President of Air Passenger Rights. He said:
[English]
The BIA proposes to create a secretive, Star Chamber-like process for binding adjudication of consumer disputes between passengers and airlines . . . .
Adjudication will be conducted on the basis of confidential information instead of evidence and with the exclusion of the public and the media.
[Translation]
This was one of his many criticisms of your future system, which isn’t quite on point yet. How do you respond to that?
[English]
Mr. Alghabra: I respectfully disagree with his assessment. We’re proposing a new method to resolving the complaints that arrive to the CTA — a much more efficient, much more customer-oriented process.
We are eliminating three stages and lumping them into one stage with two phases. The first phase is attempted mediation and the second phase would be arbitration. Any administrative type of dispute has an option of mediation that is typically governed by norms, for lack of a better word.
The norms here ask for confidentiality in case the proponent or the defendant has to reveal some commercially sensitive information for this particular incident. That’s not uncommon. That happens in all mediation. By the way, both sides have to agree to it.
If mediation fails, the officer within the CTA will have the authority to make a judgment based on what they saw during the mediation process. The CTA is obligated to publish the outcome of that judgment so there is no secrecy. In fact, it is like any other quasi-judicial body, subject to judicial review if any side is unhappy with the outcome. There is nothing unusual in this except we’re simplifying it, we’re making it quicker and we’re making it more transparent.
[Translation]
Senator Miville-Dechêne: There’s another criticism, from the airlines this time. By not enshrining in law what constitutes a safety issue and leaving it all for later, we risk having a whole series of lawsuits and court rulings to ultimately determine what is covered and what is not. Do you feel that your system will be very complex if you copy the American one, given that in Europe there have been a lot of court judgments on these issues?
[English]
Mr. Alghabra: We’re learning from both the U.S. and the European systems. What we’re coming up with now is, as I said, removing the various rationales or justifications that the airlines may use, eliminating all of them, and we’re now restricting it to one category. We’re calling it “exceptional circumstances,” and we will be defining in detail those exceptional circumstances through regulation, where it’s a common thing we do when it comes to administrative law. We’ll make sure we remove loopholes.
That doesn’t mean we want to encourage airlines to fly when it’s unsafe. However, if airlines can claim labour shortages as a safety issue and therefore they’re not going to fly, maybe they shouldn’t fly if they don’t have enough staff, but they are still responsible for compensating the customer because they scheduled the flight without scheduling enough staff to fly that plane.
We’re going to be very precise and concise in how we craft these regulations, in consultation with industry, with consumer advocates and with the Canadian Transportation Agency.
Senator Cardozo: I would like to follow up, minister, on the comments that my colleague just asked you. In terms of service standards, how will you define those? You were quoted earlier in the media saying that weather would be an exception. We get a lot of weather in Canada. Is it two inches of snow or a big snowstorm? There are often times where planes can fly in certain circumstances but not in others. How would you do that in the regulations?
Mr. Alghabra: There are two things. The service standard is for a passenger when they are waiting for a plane: What kind of service should they be receiving — food, water, access to telecommunications?
As far as the rules about what qualifies as extreme weather and what doesn’t, I can assure you it’s not going to be left up to the airline to decide that. It will be up to NAV CANADA and their experts who, based on an assessment and their knowledge, decide when it is dangerous to fly in this weather and when it isn’t.
We will not define exactly which weather is bad. We will say “bad weather” and then defer to NAV CANADA and their experts to decide if this is considered bad weather. It will not be left up to the airlines to decide when not to fly because of bad weather.
Senator Cardozo: My other question is about how you make this all work. To some extent, do you have to balance passenger rights with business interests so that they are still viable? How do you balance those two things? At times they may come into conflict.
Mr. Alghabra: Let me be very clear: It’s very important for us, as a country, to have a viable airline sector. It is important for Canadians; it’s important for our economy. I want to see a successful, viable, competitive and profitable airline sector.
What we’re doing with the passenger bill of rights is we’re not asking the airlines to do more than what they promise their customers they will do. If an airline sells a ticket to a customer on a plane at a particular date and time and says they will fly, we expect them to deliver. We’re going to allow for exceptional circumstances that they couldn’t deliver because of weather or things outside of their control. They are not going to be responsible for things outside of their control.
We intend to ensure that the airlines are responsible for what they promised to customers within their control. That’s a reasonable thing.
Senator Cardozo: I think it is. We’re running into a situation where, with labour shortages, which are worldwide and will happen for some time, we can’t do everything for everybody. Your point seems to be that they set the standard, and if they don’t meet it, they don’t do it. My concern is we not be unreasonable in what we expect of airlines, but I gather your standard is if they promise it, they have to deliver it.
Mr. Alghabra: That’s precisely it.
Senator Cardozo: That might mean fewer flights available over time.
Mr. Alghabra: I hope for the opposite, senator. The reality is that some of the ambiguity that may have existed in the current rules created confusion on the part of the airlines. When we now become very clear what they need to deliver, I think this will improve the efficiency of their operation, of their scheduling and of their labour allocation. Again, this will be good not only for passengers but for the airlines’ operations.
Senator Cardozo: Thank you.
Senator Quinn: Thank you, minister, for being here tonight, and thanks to the officials as well. Just to build on earlier commentary, one of the things I have been hearing is that we as senators are not able to do our job because of the different materials in the bill itself. We are dealing with the divisions in this committee and other committees are doing others.
Last night, for example, at the Fisheries Committee, the CSA — the Canada Shipping Act — was being talked about along with a lot of technicalities that not all senators had the background to understand, and they were significant changes that the representative last night from one of the associations talked about having seen it at the last minute, so to speak.
Regarding the things that we’re looking at in our divisions, it’s the same type of commentary in that they are weighty policy areas. I believe it is difficult for senators to do their job on matters like this. I would hope in the future that BIAs may be a little less weighty with that type of substance.
My question is around data sharing. We haven’t talked a lot about data sharing, but I agree that sharing data in the transportation system is a really important thing. The question is: What data, and how do you ensure that it is shared without compromising the commercial interests of the various entities? In the past we have talked about block chain and data warehousing. We know that’s not the answer. It’s their ability or willingness to share, and how the government will regulate what is to be shared.
Mr. Alghabra: Senator, on your first point, I believe in the role of the Senate and I know that senators take their jobs extremely seriously. I am grateful to all of you and other senators who are doing your best to manage your duties and obligations. I hear you.
On your point about data, which is incredibly important, it was also on the supply chain task force. By the way, it’s also incredibly important for the aviation sector. One of the things that the airlines keep talking about is the accountability of other sectors within the airline sector. That’s what data will do. Collecting data about operations and certain standards within different sectors of, let’s say, the aviation sector will enable the sectors to hold each other accountable. It’s no longer just the airlines that are being held responsible for everything in the sector.
On the supply chain, it’s the same thing. That’s why the creation of a supply chain office, which was included in the budget, is going to be instrumental in figuring out the answers to some of the questions you’re asking. Because there is consensus that we need more data and we need data to be shared.
What type of data, exactly? Which data should be shared publicly? Which data should be kept confidential? How do we convert it into information? There is still ongoing work being done there, but I think the principle behind data sharing is powerful. It was mentioned in the task force, I think it’s important for the aviation sector and that’s what we’re going to be working on — making sure that we have the right data and that we share the right information across the sector.
Senator Quinn: Thanks for that answer. Data sharing is so vitally important. The trick is the data to be shared and who is going to decide what will be shared. Will it be the government? Because I expect that there will be resistance when people talk blockchain. There will be resistance. How will you deal with that?
Mr. Alghabra: Again, in principle, everyone supports the idea of data sharing. When it comes down to application — just like airlines are always in favour of a passenger bill of rights until we start implementing a passenger bill of rights — we will have to sort our way through it, and we’re going to have to consult and rely on experts as well to make sure that we have the right type of data.
I welcome your input into this, senator. I know you have a lot of experience from your former role as a CEO of a port. I would invite all of you here to submit ideas on what type of data you think we need.
The Chair: Thank you, minister. I hate cutting anyone off, but I have the terrible thing called a clock next to me.
Senator Dasko: Thank you, minister. You said publicly a few days ago that you feel that after this is implemented our regime for passengers will be superior to that of the Americans and also the Europeans. The aforementioned Mr. Lukács last evening said, in fact, that we are worse off and will remain worse off than the Europeans after this is implemented. Before he was able to answer, he ran out of time. Now that I have this time with you, if you wouldn’t mind, just clarify how you think that we will be superior to Europe after this. What are we doing that is better?
Mr. Alghabra: Sure. By the way, we have a chart here. If you don’t have access to it, I’d be happy to share it with committee members. It actually compares our system to the U.S. and to the Europeans.
Senator Dasko: Great. Terrific.
Mr. Alghabra: Just last week, the U.S. announced their new updated passenger protections. I just met recently with Secretary Buttigieg and he told me that they are learning a lot from our experience and benefiting from the stuff we’re working on.
I know everybody says the Europeans have the better model. There is truth to the fact that it’s the oldest model. There is some benefit that they have, but theirs is also complicated. Don’t forget, the European Commission sets the standard, but then the application falls within different jurisdictions. Each country upholds that system differently. So I’ll tell you what we have that I think is better than the Europeans. The Europeans don’t have a service standard for customers or passengers who are waiting for a delayed flight. We’re going to introduce a service standard. The Europeans don’t have compensation for delayed luggage. We are being explicit about delayed luggage — not just lost luggage, delayed luggage.
On everything else, we are as good as the European model. There is a misnomer out there that the European system requires the airline to automatically compensate customers. That’s not true. In Europe, the passenger, if they choose to, still has to initiate a complaint to receive the compensation. It is on an equal footing. In fact, we have certain provisions that the Europeans don’t have.
Senator Dasko: Thank you. Can you explain how the fine structure is going to work? When is that going to kick in? And maybe give examples of how that would work. Before the regime comes into place, over the past year or so, have you seen examples of situations where you think if this had been in place, the airline might have been fined? I don’t know the extent to which you can provide that kind of context or examples to understand that structure.
Mr. Alghabra: Senator, the fines are a different issue than the compensations the airlines are required to provide to their customers if they violate the terms of the passenger protection rights. Fines are meant to be imposed by the CTA, if the CTA finds systemic failure or negligence on the part of the airline where they didn’t put an effort into following the rule or they have systemic failures that did not comply with the rule.
The last time I was here, I shared with you that the CTA had announced two findings, one against Sunwing and one against WestJet. What we’re changing here is that the fine’s maximum was $25,000 per infraction and we’re now upping it to $250,000. That’s not going to be the maximum fine that the CTA can levy, that’s per infraction. The CTA, depending on its investigation and its findings, can end up fining different infractions and choosing to levy multiple fines. It’s meant to strengthen the tool of having that fine for the CTA to enforce the rules.
The Chair: Thank you.
Senator Clement: Good evening, minister. Thank you to you and your officials for being here. I am not quite as grumpy as Senator Simons — I don’t travel as much as she does — but I am one of those irritating passengers that sits and talks to the person next to me. You know how you hate all those people, the chatty ones. I have been doing that especially in the last couple of years because I sit on this committee and I’m interested in this.
My question is around communications with the Canadian public. The mood is low. Canadians love to travel. They have to travel for family reasons or work reasons. They feel like they are travelling in a system that doesn’t have enough competition. They are already unhappy about having to pay cellphone fees that are higher than elsewhere. Canadians feel embattled around a lot of these issues, including air travel. The mood is low. The people I talk to haven’t bothered with seeking compensation or doing anything because they don’t believe that the system is there for them.
How are you going to communicate about these changes with the Canadian public? How are you going to deal with that low mood, which is part of your job? Do you have a plan in place? How smooth is that transition going to be from what we have now to what you’re proposing?
Mr. Alghabra: Senator, thank you for that important question. I agree with you wholeheartedly that the mood overall is low. It’s broader than just the airline sector.
Senator Clement: Yes.
Mr. Alghabra: We’ve gone through a very traumatic period over the last three years. We’ve seen extraordinary events take place that resulted in disruptions and inflation. We’re seeing it around the world. People are tired, exhausted and losing faith in institutions. I take that mood extremely seriously. This is precisely the reason why we’re acting decisively — to restore some of that faith that is essential for Canadians to have in their institutions, including government institutions.
Yes, we’re taking action. We need to communicate that to Canadians. It’s part of my job, as you said. It will also be part of the Canadian Transportation Agency’s job to let Canadians know about these new rights once they are implemented and how to go about it.
We’re simplifying the process, by the way. We’re simplifying the complaint process. That will help restore faith. We don’t want customers or passengers to feel that not only is it taking a long time but it is so complicated and they have to deal with so many people and the airlines are not responding.
We’re doing everything we can to simplify and strengthen the process so we can restore faith in the system overall, but also in their institutions so that they’re able to protect their rights.
Senator Clement: You’ve met with stakeholders yourself, right? What have you taken from them that is in here? What was the most compelling piece of information you got from the stakeholders?
Mr. Alghabra: I would say, first and foremost, we’re reversing the onus now. The passenger no longer needs to prove that they are owed something. It is now the airlines who explain why they don’t owe the passenger the compensation that they filed for. That is the biggest element here.
Second, we’re ensuring that the airlines now have a 30-day time frame to respond to customers.
Third, we’re clarifying the exemptions that the airlines can use to justify not compensating customers.
There’s more, but you asked me.
Senator Manning: Thank you, minister, and your officials, for being here.
I want to get back to Senator Cardozo’s question about NAV CANADA deciding about the weather versus the airlines deciding. I come from Newfoundland and Labrador where there are days that we have the four seasons in a 24-hour period.
At the end of the day, when NAV CANADA will tell Air Canada that they can’t fly or should fly, and then Air Canada decides against what NAV CANADA is saying, what happens then? Where does that go?
Mr. Alghabra: Well, then they’ll be responsible. If Air Canada chooses not to fly when they have no reason not to fly a flight, then they are going to be responsible under the bill to compensate their customers.
Senator Manning: I’m concerned about safety. I’d rather be on the ground safe and sound than 40,000 feet in the air and not knowing exactly where we’re going to land.
NAV CANADA will decide whether Air Canada or WestJet or whichever airline should fly. If Air Canada decides not to, they have to compensate their passengers. How will that decision be passed on? How will a passenger know that NAV CANADA has made that decision?
I have sat in airports for hours waiting for a pilot for a plane. We don’t know. There’s no communication. We’re sitting down in the airport and there is no one telling us what’s going on. We go up to the desk and they say, “We’re waiting on a pilot,” or whatever the case may be. Sometimes they don’t even give you that information.
How will that decision of NAV CANADA be relayed to the passenger?
Mr. Alghabra: Senator, the service standard will include clear protocols about communications between the airline and passenger. The airlines will be obligated to communicate to passengers about their decisions, what they’re doing and when they’re doing it.
On NAV CANADA’s decision, we have one of the best‑qualified air-traffic control systems in the world and one of the safest in the world. The world looks up to our system and our expertise. I have confidence in the decision-making process and the know-how that NAV CANADA has in deciding. I am confident that they would never authorize a flight to take off in bad weather that would pose any risk to the safety of the plane.
If we don’t have confidence in NAV CANADA, that’s a bigger, broader issue that I hope is not the case here. I have faith in NAV CANADA and their ability to make those decisions.
Senator Manning: When you mentioned exceptional circumstances, the explanation of those, from what I understand, will be coming in the regulations. When do you foresee us having regulations in black and white in front of us to see?
Mr. Alghabra: That’s a great question. The Canadian Transportation Agency was here. They told you that we’ve been consulting with them all along this process. We’re not waiting to pass the legislation in order for Transport Canada and the CTA to start working on the regulations.
My hope is, once the bill passes, the CTA is going to be able to then officially embark on the regulatory changes process. That requires the publishing of draft regulations, consulting, republishing and implementing.
My aim is to have them implemented by the end of this year, and if not by the end of this year, early next year.
Senator Manning: We live in hope.
Mr. Alghabra: We’re doing more than just living and hoping, senator.
Senator Manning: You just talked about consultations. Can you give us some idea of the consultation process you went through for this particular piece of legislation we’re dealing with now? Some of our witnesses have come forward telling us they haven’t been consulted, while others have.
Can you tell us about the consultation process that went into preparing for Bill C-47?
Mr. Alghabra: Senator, I will never forget last summer when we saw all those disruptions, cancellations and delays. The officials here, and others who are not here, have been working around the clock with the airline sector, airports, NAV CANADA, CATSA and CBSA — the Canada Border Services Agency — to wrap our arms around the problem and put a handle on it and understand the sources and the fixes.
Last fall, we convened one-off meetings here and there with different stakeholders. Last fall, I convened an air summit that invited airlines, NAV CANADA, CBSA, CATSA, unions and provinces. That was the moment where we went through the lessons learned from the summer and solicited some ideas and feedback.
Then we had the winter snowstorm issues with Sunwing, if you recall. There were different types of consultations that took place with consumer advocates, airlines and airports. I named them already.
There’s been a lengthy process that included informal and formal consultations with everyone that we can think of that needed to be consulted.
The Chair: Minister, when Senator Clement said the mood is low, I think that was polite. Canadians are pissed. They’re pissed because our airports particularly have been a mess. They were a mess last summer. They were a mess over the Christmas holidays. We’re all holding our breath as we’re going into the summer peak season.
My questions are simple. There are 46,000 complaints in the queue, minister, and the list is growing. And that is just the people who have filed with their government, going to your point about institutional complaints. What is the ministry tangibly doing and what will this bill tangibly do to alleviate these pissed‑off Canadians?
The second question is not so much related to the bill but in general. Canadians pay the highest airport fees, travel fees and airline fees in the world. What are we going to do to rectify that? I know that’s a broader issue.
The third one is a quick question that no one has brought up. I’ve travelled a few times recently on airlines in this country. We’re officially a bilingual country, and I’m an anglophone Quebecer, but I can tell you that for francophone Canadians who travel, it’s pitiful what these airlines are providing in terms of service. The more I see it, the more frustrating it gets for me for those French Canadians. Those are my three questions, minister.
Mr. Alghabra: I don’t know if I have time to respond to everything you said, but I’ll do my best.
Senator, I would also want to ask political leaders to be responsible in their rhetoric because, you’re right, Canadians are upset and in a bad mood, but some political leaders are trying to take advantage of this mood to blame everything on government when they themselves know that is not the case. They know it is happening all over the world because of the COVID recovery. I would argue it is the height of irresponsibility when people who know the truth are misleading Canadians and trying to guide that bad mood into political gamesmanship.
Now, to your point about the complaints, I announced recently an additional $76 million to the Canadian Transportation Agency to help dedicate more resources to deal with the complaints.
Second, the new rules that will simplify the CTA process will apply immediately once they’re implemented, even on retroactive complaints. The new rules on compensation may not apply, but the streamlining of the efficiencies of the complaint process will apply and then will help manage these complaints more quickly.
Third, we’re introducing the reverse onus and we’re empowering the CTA to actually charge the airlines the cost recovery for the complaints, which will create an incentive for our airlines to avoid having a passenger go to the CTA, and they’ll resolve the complaint themselves.
On your broader question about the air sector and the fees associated with it, look, I share the concerns and we should always look for ways to improve competition in our airlines. I’ll just argue that, today, we are seeing the best competition we’ve ever seen in the Canadian aerospace sector. I know it doesn’t feel that way. Personally, I feel we need more competition, but we now have more airlines than we’ve ever had before. We are a large country, a vast land mass with a not-so-dense population, so it makes travel a little bit more costly than other countries. However, if the committee is willing to look at what else we can do and to make recommendations to government, I would be more than happy to receive those recommendations.
The Chair: Thank you for the answers, minister. I know that this government has a tendency of calling hard questions from the opposition sometimes as taking advantage of partisan politics, but we have an obligation as parliamentarians to express the feelings of taxpayers and Canadians toward the executive branch of government. For me, that’s a moral obligation for the people I represent.
Mr. Alghabra: Senator, if you’ll allow me — I’ll be quick — I actually encourage that. My job is to express the feelings. My point is misguiding Canadians about the causes — blaming government for everything. That’s where I differ with you. I’m not saying you do that. Maybe you do; I don’t know, but I’m saying —
The Chair: I’m sure government-appointed senators think I do, and those in opposition to the government on certain issues think I’m not aggressive enough. In democracy, it’s all a matter of opinion.
Mr. Alghabra: We owe it to Canadians to be aware of their sentiments and to be able to offer solutions to the problems that Canadians feel. We just need to be focused on providing solutions and putting our country first. That’s what I would argue, senator.
The Chair: I totally agree, minister.
Senator Simons: One of my questions was just answered about the 46,000-person backlog. But I want to come back to service for people who are trapped. It’s one thing to say, “Well, you’ll get a voucher for a meal when you get off the plane,” but what about the people who are trapped on planes for 6 hours, 7 hours, 12 hours or 15 hours with no food and no fresh water and without working toilets? Will there be service standards for people who are trapped so that they either must be allowed off the plane, even if it’s just for a breath of fresh air or to go to the terminal to use the bathroom? Will there be some emergency provision made to prevent those indecent conditions that one should not have to put up with? In any other circumstance, we would not allow that.
My other question is about CATSA. We contract out the services of the screeners and I’m concerned that we may not have enough of them. When CATSA was here, they said that staffing levels have come back up. I was flying out of Ottawa two weeks ago. There was one security position open for the entire airport. The line was gargantuan because there was one tranche doing security, and that was it.
That may have been an anomaly, but how confident are you that CATSA has the resources it needs to move people through airports swiftly?
Mr. Alghabra: Thank you, senator. To your first question, the rules are clear. Three hours is the limit on a plane — no longer than three hours. If the plane is unable to take off, they need to disembark their passengers. If an airline is found in violation of this rule, they owe their passengers compensation. The rules are clear. We’d be happy to provide you with briefings about the rules. I hear you that sometimes the rules are not followed, but that’s an enforcement issue. That is why we’re now reversing the onus on the airlines. It’s no longer on the passenger to explain that the airline broke the rule. We would certainly ensure that airlines hold up their end of the bargain.
CATSA is a Crown corporation, a stand-alone organization that is accountable to Parliament through the Minister of Transport. We have a service standard by which CATSA has to abide where 85% of their passengers need to be processed in 15 minutes or less. We are now looking at improving that and, in fact, strengthening that. We need to hold CATSA accountable for that performance standard and expect them to do what is needed to meet that standard. That’s the best way for us to assess their performance.
It’s not for me to know how many staff they need and where and when. They need to know their operations, but they have a standard to meet. They need to ensure their team is meeting those standards.
Senator Simons: Every airport seems to have its own protocol. Edmonton, where I fly out of, has a fantastic program now where you can pre-book a time to go through an accelerated line. So it’s not based on whether you’re flying business class or you have a trusted traveller status. Anybody can take a little extra time and make the booking, and it goes much faster. Ottawa is its own special kind of place.
Mr. Alghabra: Senator, if you sometimes see discrepancies, there are times when we’re doing pilot programs with one airport or another. Right now, we’re doing a pilot with the Toronto and Vancouver airports for verified travellers who do not have to take fluids or laptops out of their luggage, and it’s proving to be very good and successful. It’s starting as a pilot, but you may see some discrepancies because of these pilots.
Senator Quinn: I’m just wondering about the discussions we’ve had tonight and the people who are listening tonight when we talked about user pay. At the end of the day, do we have enough people at the airport doing the security? Do we have enough people in different parts of the system? Are there enough people in the department to increase the number of folks that oversee the regulations and the monitoring, et cetera?
I would think that a lot of people are saying all of this combined is going to cost me more to fly. Is that something the travelling public should be aware of or concerned with?
Mr. Alghabra: I am concerned with making sure that travel is affordable. That’s why, as I said earlier, I’m encouraged by the presence of more competition today. We have Porter expanding, and we have Flair, Lynx and other regional airlines that are expanding their operations. That is going to be healthy for our sector and it’s going to include options that never existed before, including pricing options.
I don’t buy the idea that having clear passenger protections will lead to more expensive air sector travel. As I said, we’re not holding the airlines accountable for the type of food they serve. We’re not holding the airlines responsible for the colours of their seats. We’re asking airlines to deliver what they promised the customer when they bought that ticket to deliver.
I think that is a reasonable thing. When the airline understands what the guardrails are, what the rules are, I think they’ll find efficient ways to deliver it and make sure that it’s competitive.
Senator Quinn: I’m not talking about the costs that the airlines might have because of the food or the colour of their seats. I fly Air Canada to Saint John; it’s the only choice. If I’m going to Hamilton I can take Flair so I know the meal’s going to be pretzels; it’s pretty straightforward. I’m talking about all the backroom operations and things that we’re trying to improve upon. I know from past experiences that when we bring in new approaches and ways of doing business, one of the things we seldom think about is the resulting increases in costs, whether it’s more people in the bureaucracy or more people at the airport doing the inspections and things of that nature. Has there been any thought about what that cost is?
You just said CTA received more money. They talked about it when they were here the other night. All those amounts of money add up. What do we say to the travelling public that, despite all of this, your costs won’t go up significantly or at all because of the backroom operations, not because of the type of pretzels that Air Canada serves?
Mr. Alghabra: I think about this every day, senator. I think about the consequences and impact of government decisions on the sector. That’s precisely why I believe this is the right thing today.
First, I feel what happened last summer and last Christmas left the government with no option. Given the disruptions and the chaos that we saw, Canadians deserve to have better, stronger and clearer rules to protect them and to ensure their rights are upheld. I have no hesitation in saying this was necessary.
Second, the way we introduce it matters too. There is no new red tape for airlines. There is no new reporting mechanism for the airlines. We’re not asking them to add layers of reports because of this passenger bill of rights. We’re just asking them to do what they said they were going to do.
I don’t see this leading to an increase in backroom operations. I just see this as streamlining and improving the operation performance of the airlines.
Senator Manning: I want to get back to your earlier comment. I didn’t catch exactly what you said in relation to the baggage delay rules in the EU. There are rules in the EU about baggage delay. Will this piece of legislation we’re moving forward here help with baggage delays? Again, people are waiting three and four days for their luggage sometimes, not the next flight coming in. Where is the baggage delay issue here?
Mr. Alghabra: Sure. I’ll be happy to distribute this chart to all members of this committee. It highlights the differences between the Canadian, U.S. and EU rules.
The idea here is that luggage lost has to be compensated for. But if luggage arrives two or three days later, the airline can say, “We fulfilled our obligation.” What we intend to do by regulation now is to have clear rules about what is acceptable for the late arrival of luggage. If it does not arrive on time, the passenger should receive some compensation.
Let’s say you’re travelling and you stay in a hotel. You don’t have your clothes. You might get them tomorrow, but you need to buy a toothbrush and a shirt. We need to have a standard where the airlines need to be obligated to ensure that the passenger is at least kept whole for the consequences that delayed luggage causes them.
Senator Manning: Did I hear you correctly in offering a briefing to us on the new rules and regulations when they come into place? If so, could I take you up on that?
Mr. Alghabra: I’m happy to do so. The regulatory process is public. As I said, when the CTA first introduces the draft regulations — it will be done, hopefully, early this fall — it will be public. If you desire to invite members of the Canadian Transportation Agency, me or my officials, we would be happy to come and discuss them with you.
Senator Manning: I look forward to that. Thank you, minister.
The Chair: On behalf of the committee, I would like to thank you, minister, and your officials for being with us this evening. As I said earlier, we really appreciate your accessibility and availability to this committee all the time. Thank you for going over the allotted time today as you did for a few minutes. We did it with the permission of your staff, so you can blame them if you weren’t in accordance, minister. Thank you very much, minister.
Mr. Alghabra: Thank you very much.
(The committee continued in camera.)