THE STANDING SENATE COMMITTEE ON TRANSPORT AND COMMUNICATIONS
EVIDENCE
OTTAWA, Wednesday, May 22, 2024
The Standing Committee on Transport and Communications met with videoconference this day at 6:45 p.m. [ET], to study the subject matter of those elements contained in Divisions 27 and 37 of Part 4 of Bill C-69, An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024.
Senator Leo Housakos (Chair) in the chair.
[Translation]
The Chair: I am Leo Housakos, senator from Quebec and chair of this committee.
[English]
I would now invite my colleagues to introduce themselves.
Senator Simons: Senator Paula Simons, Alberta, Treaty 6 territory.
[Translation]
Senator Oudar: Manuelle Oudar from Quebec.
Senator Clement: Bernadette Clement from Ontario.
Senator Miville-Dechêne: Julie Miville-Dechêne from Quebec.
[English]
Senator Quinn: Jim Quinn, New Brunswick.
Senator Dasko: Donna Dasko, Ontario.
[Translation]
The Chair: Today we continue our study of the subject matter of divisions 27 and 37 of part 4 of Bill C-69, An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024.
This evening, we are pleased to welcome officials from Transport Canada responsible for High Frequency Rail to discuss division 27, which concerns a subsidiary of VIA Rail. We are joined by Vincent Robitaille, Assistant Deputy Minister; Chantale Côté, Director General, Policy and Governance; François Camiré, Director General, Technical and Impact Assessment; Miguel Izquierdo Martin, Acting Director General, Procurement and Commercial; and Natalie Dolan, Executive Director, Policy.
[English]
Welcome, and thank you for joining us this evening. Mr. Robitaille, you’ll be accorded a five-minute opening statement and then we will go to Q & A.
[Translation]
Mr. Robitaille, you have the floor.
Vincent Robitaille, Assistant Deputy Minister, High Frequency Rail, Transport Canada: Thank you, Mr. Chair.
On behalf of Transport Canada, I would like to thank you for the opportunity to testify today. My name is Vincent Robitaille, and I am the assistant deputy minister responsible for the High Frequency Rail (HFR) project at Transport Canada.
I would like to begin by acknowledging that we are gathered today on the traditional territory of the Algonquin Anishinabe people.
[English]
It is a pleasure to be here today to speak about the HFR provision in Bill C-69 that would provide agency status to the VIA Rail subsidiary VIA HFR – VIA TGF Inc.
This measure can be found in Part 4, Division 27, pages 551 and 552.
[Translation]
I am joined by Chantale Côté, Director General, Policy and Governance; François Camiré, Director General, Technical and Impact Assessment; Miguel Izquierdo Martin, Acting Director General, Procurement and Commercial; Natalie Dolan, Executive Director, Policy, for the HFR project.
The HFR project is the largest transportation infrastructure project that Canada has seen in generations. The objective of HFR is to offer faster, more reliable, and more frequent rail service. However, HFR is more than a rail project.
Fifteen million people currently live in the Toronto-Quebec corridor. The populations and the economies of Ontario and Quebec will only continue to grow, as will the demand for all modes of transportation, including passenger rail.
This project presents an opportunity to meet future demands while transforming rail travel to a more sustainable and more accessible way of travelling for future generations.
At this time, VIA Rail cannot make major improvements to its passenger services.
Rail congestion on the current tracks limits the frequency of departures, the reliability of arrivals and the time to reach the destination.
To put it simply, without a transformative investment, ten million trips per year would be taken using higher emitting modes if rail passenger services are not improved.
[English]
High Frequency Rail, or HFR, consists of building a new intercity passenger rail system over 1,000 kilometres in length to serve Toronto, Peterborough, Ottawa, Montréal, Laval, Trois‑Rivières and Quebec City.
High Frequency Rail will provide fast, reliable and frequent service. It will triple the number of rail passenger trips in the corridor to at least 17 million by 2059. It will double the number of train departures, with at least 12 departures per day between major cities. It will dramatically improve reliability to ensure trains leave and arrive on time. It will provide faster service, offering shorter journey times.
It will continue to serve communities currently served by VIA Rail, such as Kingston, Cornwall and Drummondville, with expected improvements to scheduling and convenience. It will create thousands of well-paying jobs during the design, construction and operation of the service.
As an electrified service, it will deliver significant reductions in greenhouse gas, or GHG, emissions and it will contribute positively to the Government of Canada’s commitment to reconciliation with Indigenous peoples.
[Translation]
The HFR project will be delivered in four phases.
The first phase of the project, from 2017 to 2021, was focused on due diligence of the initial VIA Rail proposal.
This assessment concluded that investment in passenger rail was necessary and would bring important social, economic, and environmental value.
In Budget 2022 the government announced its decision to proceed with Phase 2 of the project — the procurement phase.
In 2022 a new subsidiary of VIA Rail, VIA HFR–VIA TGF Inc., was created to serve as the project delivery office for HFR.
[English]
While VIA HFR is building capacity, the government is leading an innovative procurement process that takes into account lessons learned from other large Canadian and international infrastructure projects. VIA HFR serves as the technical and commercial advisor during this phase.
Once the procurement is completed and subject to government decisions, the project would then move to phase 3, co‑development. Phase 3 will be led by a fully operational VIA HFR, and activities will focus on developing the HFR design, accelerating the engagement of stakeholders and preparing for a final project contract.
This will be followed by phase 4, the actual construction of the project, and phase 5, maintenance and operations over a 40-year period.
The HFR project continues to gather momentum during the procurement phase. In July, the Government of Canada qualified three bidding teams to respond to a request for proposals.
Just last October, the government launched the request for proposals, a critical step that will lead to the selection of a private developer partner for the project. Proposals are scheduled to be received in summer 2024 and the evaluation will be completed in late 2024.
To maximize the benefits and innovation, the request for proposals, or RFP, requires bidders to develop two solutions to meet the project outcomes: one with speed up to 200 kilometres per hour, and one that includes high-speed segments to achieve shorter journey times in the corridor. This will be followed by a rigorous assessment of the costs and benefits of incorporating high-speed rail on each segment of the corridor.
[Translation]
With this approach, the government will be able to determine the best solution for the HFR project, based on fierce competition between many of the most accomplished Canadian and international companies.
We are convinced that such competition will maximize innovation, and result in the best project for Canadians.
[English]
The HFR procurement is on schedule to receive bids this summer. Through the RFP, the bidders have been very engaged, providing novel ideas that can be leveraged during the next phase of the project, for example, proposals for preliminary alignments that minimize sharing of right of ways with host railways and offer better, faster services with shorter journey times. We expect the proposals we will receive will significantly improve the project.
Finally, the purpose of the measures that are included in the budget implementation bill is to make VIA HFR an agent of His Majesty in right of Canada. This is essential at this time to advance high frequency rail.
The declaration of agent status will provide certainty to the procurement process. It is critical to provide the necessary assurances sought by all three bidders, creating confidence in the financial backing of the project by the Government of Canada.
Agency status would allow VIA HFR to benefit from the immunities, privileges and prerogatives that are enjoyed by the Crown. It would also assist VIA HFR in developing its land acquisition strategy. As an agent of the Crown, the properties that VIA HFR acquires will become federal lands.
If there is no agency declaration through this act, Transport Canada would not be in a position to provide the necessary reassurances sought by bidders prior to the signature of the pre‑development agreement for the project expected for this fall. Without these assurances, VIA HFR would lose market confidence due to uncertain financial backing from the government. It is therefore crucial.
[Translation]
This concludes my remarks. Once again, I thank you for inviting us to express our views on this exciting project.
[English]
It will be our pleasure to answer your questions.
[Translation]
Senator Miville-Dechêne: We are discussing the part of the budget that affects the creation of this VIA Rail subsidiary, which is a rather technical subject.
I’d like to know this: What are the advantages of such a solution versus asking VIA Rail to do the work, and how do you compare? For example, in Quebec, we have a very large HST project, and we asked the Caisse de dépôt et placement du Québec (CDPQ) to facilitate its creation. So, you’ve made other choices and you’re creating a subsidiary from scratch, but it’s going to take time for it to develop a certain expertise. Explain to me why you made this choice. Other than to say it’s one of Her Majesty’s companies, what more does it bring to Canadians?
Mr. Robitaille: Thank you, senator.
In fact, the approach the government has used is to study similar projects around the world, to determine which is the best structure to deliver the project.
What did we learn? That it was beneficial to have one organization focus on the construction project, while keeping another organization focused on operations. That’s what we have now. VIA Rail will continue to do its excellent work and operate trains across Canada, and we’ll also have an organization dedicated to managing the project, which is — let’s not forget — the biggest infrastructure project since the St. Lawrence Seaway. So it calls for different skills.
The Crown corporation was created in 2022; it will soon be two years old, and it has continued to build its capacity.
Its board of directors is now almost complete, a CEO has been appointed and there are now about 80 employees to support the project, to go out and get world-class expertise and act as a counterpart to the private sector.
The government is responsible for procurement to keep its momentum while the Crown corporation builds its capacity. We’re working hand in hand with VIA HFR on procurement and tendering, and when a private partner is selected, responsibility for the project will become that of this Crown corporation, which will now be mature enough to take on this role.
Senator Miville-Dechêne: I didn’t know we had two choices, either a train that is completely high-speed from start to finish, or with only a few high-speed portions.
Mr. Robitaille: As part of the call for tenders, bidders are asked for two potential solutions: one with a maximum speed of 200 km/hour, which we call a conventional train service — although much faster than what we currently have — and a second proposal with no maximum speed.
This summer, we will receive their proposals, and with this information, the government will be able to consider high-speed train options, whether for certain segments or for the entire project.
Senator Miville-Dechêne: So, either segments or the whole train that would be high speed are still on the table?
Mr. Robitaille: Exactly; the decision will be based on the cost, the quality of the proposals and the benefits it will all offer.
Senator Miville-Dechêne: Do we already have a maximum cost? Has this already been included in a budget?
Mr. Robitaille: At this stage, it’s premature to have a budget, because we need to look at costs over the entire project life cycle. There are construction costs, but revenue and profitability will also depend on service quality and customer traffic. The initial cost of construction is higher, but you have to consider the long-term benefits.
Senator Miville-Dechêne: I love trains, so the subject interests me a lot.
Senator Simons: I love trains too.
[English]
Unfortunately, I live in Alberta, and this train is not going to help me much. When I visit Ontario and Quebec, I look forward to one day being wheeled in from my wheelchair onto the train.
I want to focus in on the issue of Crown immunity and the assembly of land that’s going to be required. As I understand this legislation, giving agency status would allow that land acquisition not to have to comply with municipal or provincial land use regulation. The agency would have the same power that the federal government would have, presumably, to purchase or expropriate land.
Could you talk a bit about what that immunity from municipal and provincial legislation might mean in terms of land assembly and whether that lowers the cost of the land?
Mr. Robitaille: I will give the first part of the answer and turn to Ms. Dolan for the second part.
The agency status does not provide VIA HFR with the authority to expropriate land. The Expropriation Act, with the responsibility of the Minister of Public Services and Procurement, would remain a requirement for the land. That said, you are correct that once it is federal land, the applicability of municipal and provincial regulation is different.
I’ll turn it over to Ms. Dolan to walk us through some of the key differences.
Natalie Dolan, Executive Director, Policy, High Frequency Rail, Transport Canada: In terms of land and what that means from the perspective of land ownership being federal land, the land would not be subject to other orders of government taxes. That’s a key piece, but it’s not the main element. There’s something called payment in lieu of taxes, which I’m sure you’re familiar with. It’s how the municipalities are compensated for that land in a manner that’s not through taxation. That’s one key piece.
Another key piece is that the land would not be subject to municipal zoning. VIA HFR has an extensive stakeholder municipal engagement plan to work through to have a plan that will enable us to effectively work with municipalities on location. However, in effect, by being federal lands, the land would not be subject to municipal zoning laws. Those are the two main impacts.
Senator Simons: I think Mr. Robitaille said in the beginning that this is also going to be good for reconciliation. The right-of-ways or the land you’re intending to assemble, is any of it Indigenous land?
Mr. Robitaille: Part of the competitive RFP process is to get a proposal that includes the alignment. At this point, we have not determined the final alignment, where the tracks will be. That said, it is a requirement that the tracks are not built on current reserve land, but there are also areas that are subject to land claims from various communities.
Maybe Mr. Camiré can describe the extensive engagement we’re doing and how the project is being designed so that we can support the goal of reconciliation.
François Camiré, Director General, Technical, Engineering and Impact Assessment, High Frequency Rail, Transport Canada: As Vincent mentioned, there are two criteria we are using as we are in discussion with the three consortiums. One is to avoid any reserves, as well as plots of land where there are potential land claims.
As part of our engagement during the procurement process with the consortiums, we have had many discussions with them and we are looking at proposed alignments that they may be considering, always making sure we consider the two points I just mentioned.
We are working closely with our colleagues from Crown‑Indigenous Relations and Northern Affairs, or CIRNAC, to ensure we have a good understanding of the locations we are discussing with the proponents.
Senator Simons: Typically, as I understand it, agents of the Crown don’t contract with the Crown. What safeguards are in place to make sure there isn’t — I don’t know if “conflict of interest” is the right technical term, but if you have a situation where they have been declared an agent of the Crown, you’re now giving them special power to contract with the Crown as well; is that correct?
Mr. Robitaille: The provision here is that they are declared an agent of the Crown, but they can also sign certain contracts as if they were not an agent of the Crown. The goal is not to sign contracts with the Crown itself, but it’s really for certain purposes. It represents a more prudent approach to have VIA HFR not act as an agent of the Crown.
Senator Simons: How does that work? It’s like Schrödinger’s train. Are they or aren’t they an agent of the Crown?
Ms. Dolan: As an agent of the Crown, they won’t be contracting with the Crown. But I think Mr. Robitaille’s point is that even when they’re making other contracts, they’re in their own right and name.
For example, if they hired a consultant, they have the full financial backing of the Crown. If what they’re doing falls within their mandate as it has been approved, for example, through their corporate plan, if they’re doing something within the context of what is approved and accepted for them to be doing, it is the Crown that gives them that financial backing. When they go into, for example, an agreement with a private development partner, they will be backed up financially by the Crown. So they are entering into the relationship as an entity, but they have the backing of the Crown. If that helps, that is the mechanism, what’s actually happening.
Senator Simons: I’ve made a joke, but I really do look forward to riding this train. I am obsessed. The second most exciting part of our honeymoon was riding the TGV.
The Chair: Senator Simons, when we go in camera, we’ll ask about the first one.
Senator Dasko: How can I follow this one? Thank you for being here. On the topic of excitement, I’m very excited by this train proposal. Being from Toronto, of course, I’m always looking for a faster way to get to Montréal and Ottawa. This will be it, right? We just have to hope that it’s going to happen.
You have already answered one question. I was going to ask you how many companies are bidding. You said three.
In terms of the procurement, you have given them specs for two options. Surely, there must be some ballpark that they are working with and that you are working with. Can you say what it is?
Mr. Robitaille: You mean ballpark on cost?
Senator Dasko: Yes.
Mr. Robitaille: At this point, we need to respect the competitive process and not give out numbers that could influence their proposal. We are very much looking forward to getting the information from our bidders.
Senator Dasko: There must be some numbers floating around. You can’t say what they are.
Mr. Robitaille: Correct.
Senator Dasko: Okay. That’s understood.
I’m interested in how much of the track is a new dedicated track and whether the train will actually have to use some other tracks. When you use the train stations in communities, they are all in central areas. Are you going to be able to have a dedicated track all the way? You have to use track that is already there, correct? Can you just explain that a bit more?
Mr. Robitaille: Our different bidders have different solutions. The information that we have is that the tracks will be mostly dedicated. You can imagine them next to existing tracks, like freight tracks, and sometimes in a completely new area. The goal here is to remove the dependency on host railways like CN and others.
To get into cities, as you’ve said, there are benefits of having stations that are centrally located. Again, accessing those stations is one of the most important elements of HFR. We are requiring that the stations in Montréal, Toronto and Quebec City be located centrally in the downtown area — either in an existing station or something close by.
To access those cities, in particular Toronto, there will need to be a sharing of tracks with Metrolinx. They are a like-minded passenger railway, and we have an excellent relationship with them. In Montréal, depending on what rail you use, there are different challenges. Overall, we expect that there will be some sharing of tracks to access the downtown area.
Senator Dasko: How are they going to deal with the issue of level crossings?
Mr. Robitaille: For the trains to go 200 kilometres an hour, or more, most or all of the great crossings would need to be eliminated for the project.
Senator Dasko: What are some of the ways they will deal with that then? I am thinking about the European trains that I have seen. Some of them travel along what seems to be a very deep ditch — I call it a ditch because I don’t know what other word to use. The train runs below grade, essentially. It’s something I have noticed when I’ve been there. How are they going to deal with that?
Mr. Robitaille: There are various solutions. One is doing a cut to have the tracks. Often it is easier to have the roads go under the tracks because trains cannot go as steeply up and down as easily as cars. You see this in many cities, like Montréal and Toronto. You see many of the roads going under the tracks when they did a great separation.
The third option is to have to tunnel part of the alignment or to elevate the tracks. You must have seen those in Europe. Those are the most common approaches to separate trains from other vehicular traffic.
Senator Quinn: Thank you for being here tonight. My question comes back to one of my colleague’s earlier questions. We’re going to create an agent of the Crown who is going to act independently and become the contracting authority but with the financial backing of the Government of Canada.
Where does the sharing or the liability reside? At the end of the day, if something goes wrong, the federal government is going to be responsible because the agency can’t sustain that responsibility. Is that correct?
Mr. Robitaille: That is correct.
Ms. Dolan: Thank you, senator. You have your finger right on the money. That is exactly one of the purposes of this.
Senator Quinn: With the creation of this agency back in 2022, why wasn’t this dealt with then? There would have been a decent understanding going into it. We’re dealing with it in the BIA, and it has significant implications for the creation of that agency to conduct the work on behalf of the Government of Canada. Is there a relationship between the government and the agency when it comes to the review and award of contract or will they have complete independence?
Mr. Robitaille: The project has and will continue to have a robust governance process. Obviously, the corporation has the CEO and a board of directors that has a fiduciary responsibility for the project. This is a nation-building project involving significant complexity and cost, so there will be oversight by the Government of Canada.
I know I had a lot of things in my introductory remarks, but at every stage of the project there will be decision gates that will be taken by the government based on the progress that the HFR has made.
The goal here is to have the right balance between the flexibility and nimbleness that is necessary to advance a project like this at a good speed, while at the same time having that robust oversight by the government as the shareholder, with the taxpayers being the ultimate funders of the project.
Senator Quinn: There’s always contingencies for liabilities. Those liabilities would be addressed by the federal government in concert with the agency, is that correct?
Mr. Robitaille: Correct. The agency will ultimately get all of its funding from the Government of Canada. If the project costs more, then it’s going to be a bigger cost for taxpayers. If the project costs less, then it will be a lower cost for taxpayers.
Senator Quinn: In the documentation we got, it says that the bidders, or the private sector I guess, want to have confidence in the agency. Therefore, this is being dealt with in an expeditious fashion using the BIA. Other places in the documentation states that separate legislation could have been an option.
If that was an option, the department would have been talking about it probably in 2022 — that is, about the best way to set up the agency. Here we are, again, with the BIA, with things with big impacts, but it seems like we’re catching up with what probably should have been done at first.
I wish the officials from VIA and VIA HFR were here this evening because they are the ones who will be responsible for the overall management of this. I appreciate you folks are from the department, but you can’t represent that agency. It would be an unfair place for you to be with me asking questions that I probably want to ask the agency, is that fair?
Mr. Robitaille: That is correct. For the procurement, we are working hand in hand with the VIA HFR. We are team Canada working on the project. We’re preparing for the next phase where they will be in charge of the project and the government will take a step back and go back to the role of the shareholder and investor in the project.
Senator Quinn: I appreciate that you can’t specify any class of estimate. But you probably can comment on how much has been spent on this initiative so far?
Mr. Robitaille: Up to March 31, 2024, $132 million has been spent, so that covers the due diligence. Because VIA Rail made the proposal in 2016, those costs include the due diligence made on the initial proposal; the creation of a joint project office between VIA Rail and the Canada Infrastructure Bank to develop the business case for the project, and the preparation for the request for proposals that we have run as well as the initial portion of the bid fee that we’re paying to all the bidders.
Senator Quinn: Who will operate and maintain this project at the completion of the project? Is it the Crown agency?
Mr. Robitaille: Basically the Crown agency will be responsible or VIA HFR will be responsible for a contract that includes the design, construction, maintenance and operation of the service.
Senator Quinn: The agency will do it?
Mr. Robitaille: Yes, they will do the oversight.
Senator Quinn: My last question is this high-speed rail, which is way overdue, other countries have done this very well, but in any case this is on the very high end of the VIA Rail revenue generation spectrum. So if that revenue is accrued to the books of the agency, who is going to be responsible for operation and maintenance, what happens to the rest of the VIA Rail system? Is this the beginning of the end for rail service to my colleagues serviced out West? Is it the end of rail service in Atlantic Canada, which is already down to virtually nothing? Is this the beginning of the end? We will concentrate on the big, high-speed populated area, is that partly what is going on?
Mr. Robitaille: Budget 2024 also included a commitment for the Government of Canada to replace VIA Rail’s fleet serving the rest of Canada so, the service to Halifax, the service between Toronto and Edmonton and going all the way to Vancouver, was an important commitment that was made in Budget 2024 to the long-term service that VIA Rail provides across the country.
Senator Quinn: Thank you. I’ll go round two.
Senator Clement: Welcome to the committee. I also love trains. My goodness. I love them in Canada, but I wasn’t on my honeymoon so there is no spice here, folks. But you know, when you’re in Paris, it was this fast train and I am thinking to myself, “Why can’t we have this in Canada?” There is a lot of excitement around this project for sure.
I have three questions around community engagement, procurement process and also Cornwall. Full disclosure, I was the Mayor of Cornwall, and we had some challenging conversations with VIA Rail about service as a smaller community along a very busy corridor, but also challenging conversations around this project, and what it would mean for Cornwall, a small city of 50,000 people with an Indigenous community, with counties feeling left out of that because we’re on the rail owned by CN. Do we get a stop there on that high-frequency project?
I’m wearing my Ontario senator hat, and speaking for that region and wondering if you can reassure Cornwall and area — that’s between Montréal and Kingston — about whether they are going to be left out of this project.
Number two is the procurement process. I’m an Ontario senator. We talk about the Ottawa Light Rail project, and the unsuccessful situation going on in the City of Ottawa and the public’s perception around procurement and partnerships with private entities, right? You said in answer to Senator Quinn that the Crown agency will have oversight over this contract, but Canadians are having some doubts about how the government and Crown agencies partner with private entities.
My third question would be around community engagement. The word “taxpayer” was mentioned. This is the largest project since the Voie Maritime, so taxpayers have to understand what this means. How are you speaking to communities around this? Because I can tell you in Cornwall, we’re feeling a little left out, or maybe we are feeling that and want to feel more connected to the project. What are your plans around community engagement? How are you communicating with Canadians around this project?
Mr. Robitaille: Thank you, senator. I’ll take your question on Cornwall and I’ll turn over to my colleague Mr. Martin on procurement and Mr. Camiré on community engagement.
First, on Cornwall, thanks for this question. In my introduction, I mentioned lots of things. The commitment of the government is to build the new line that will be the new right of way, but also preserve service to existing communities like Cornwall and Kingston. So that line between Montréal and Toronto.
But the new service would not go through Cornwall. It would be more north, so that’s the alignment that we expect.
Part of the commitment and the request that we’re making to bidders is to improve the service to those communities. As the Mayor of Cornwall, I’m sure you have taken the train or you have seen it. Currently the schedules are optimized for a trip between Toronto and Montréal. I was looking at the schedule actually for Cornwall. I think the earliest you can get to Montréal is about noon or something. It is the same thing to Toronto.
One of the areas we know that the service can be improved, if you’re not trying to cater to a passenger between Montréal and Toronto, is actually having a schedule that works for the people of Cornwall or Kingston, which is not the case right now.
To be honest, the new line will not come through Cornwall, but we are seeing opportunities to improve the service in a manner that will make the train more compelling for the residents of the city.
On the step that we’re taking on the procurement, if you allow us, we have been looking at projects in Canada and across the world looking at the best practice, the things to do and the things to avoid. Mr. Martin, maybe you can walk us through some of the key lessons learned and why we’re doing the things the way we are.
Mr. Martin: In a very complex project of this size, it’s very important to learn from other projects, megaprojects. One of them was the Ottawa LRT. In particular, we studied very closely the Ottawa Light Rail Transit Public Inquiry and the report with different recommendations.
There are a number of differences between the approach that we’re taking and the approach that the city took. In particular, we chose a collaborative P3 model which is a step forward from the traditional P3 model. It’s an important differentiation where we engage the partner earlier to help us with innovation, finding ways to provide and to maximize the benefits to the project. Also, we have created the Crown corporation, as mentioned by Mr. Camiré, to absorb, to be able to attract the professionals and the skills required to deliver a project of this magnitude.
It’s also very important that we are using this collaborative approach. We’re selecting right now the private developer partner who will collaborate with VIA HFR to further advance the project together.
The last important part is that we are selecting a private partner that is responsible for the design, construction, maintenance and operations. We think that there are important differences with the project that you have referenced, but we have studied it as well as many other projects in Canada and overseas.
Senator Clement: I’m glad you mentioned the light rail inquiry, because a lot of information came out of that. We’ve learned that traditional P3 models do not help the taxpayer. At the end of the day, it’s the government agency that ends up paying more. If you’re speaking of a collaborative model, which is different, I’m heartened by that, and we’ll continue to get more information about that.
Mr. Robitaille: We spoke about the importance of the operator. In all three consortiums, we have a major international operator of both conventional and high-speed railway. For the team called Cadence, we have Keolis, SNCF from France that are participating, and they are well known. In Intercity Rail Developers, we have First Group, which is the largest private operator in the U.K., as well as Renfe from Spain, that are part of the organization, which is the high-speed rail operator and conventional rail operator in Spain. For QConnexiON Rail Partners, we have Deutsche Bahn, which is the operator in Germany.
One thing we did not mention in our remarks is we have the best in the world competing for this. The world is paying notice. This is the largest project going on right now, and they all want to support Canada in that change.
Mr. Camiré: It is critical, as part of this project, for obvious reasons, that we consult with all of the stakeholders. Our strategy has been — and you may have noticed over the past couple of months, VIA HFR, namely, the newly appointed CEO, Martin Imbleau, has been very present, meeting with municipalities and Indigenous communities as well as various chambers of commerce. During the co-development phase, we will maintain or even increase the frequency of those engagements once the partner is identified.
We will continue to meet with all of the stakeholders I just mentioned throughout the co-development phase. As an example, during the environmental assessment, we will work with all affected stakeholders.
Senator Clement: Thank you for those answers. I’ll say one last thing. It will be very important for those communities off that track, wherever they may be in Canada, that they feel confident that VIA Rail is not going to — I know this is not necessarily your file, but there is a connection. Canadians will buy into this project if they feel they’re not going to be left out of service. That is crucial, and it’s Cornwall but it’s not just Cornwall. Thank you.
Senator Quinn: Just a couple of short things, really.
The consultations, section 35 Aboriginal rights with respect to consultation and whatnot, you mentioned you’ve laid out some potential routings. Have you done any consultation with First Nations who could be affected, or are you waiting until the decisions are taken about what the routing will be and then go and consult? That could be disastrous for getting acceptance amongst First Nations.
Mr. Robitaille: We’ve been — Transport Canada and then VIA HFR have been consulting with the Indigenous community over the last year and a half in advance of the project. There are more than 40 Indigenous communities that can be impacted by the project. We’ve already been engaged multiple times. If time allows, I could ask Mr. Camiré to give you a few examples of what we’ve done, because we’re trying to innovate in that field and go beyond what typical projects do to achieve that level of reconciliation.
Senator Quinn: I want to be respectful to my colleagues. You’ve answered in terms of, yes you’ve had those discussions already at this stage, which is good.
Under what authority — this project will go, as you say, Toronto right up to Quebec City. What’s the authority that allows the federal government to do this project going through Ontario and across Quebec? In other words, is there something that needs to be done to give them the authority to execute this project in provincial territories?
Ms. Dolan: I will just start by saying that VIA Rail currently services across many provinces. This new railway company will be integrating VIA Rail’s existing services and adding in the HFR line. This is more an expansion of existing services, and it would be a federal railway undertaking if we do this. There’s no particular authority to — in addition that’s needed.
Senator Quinn: Thank you for that answer, because I was wondering about — one of my pet areas is the declaratory power under section 92(10)(c) because that’s a power that’s been used for different projects of a large magnitude such as this in Canada, and I was curious if that’s something that has to be looked at. I’ll leave it at that.
My last question is this: The rail that goes into the station in Quebec City, does it need to be adjusted in order to accommodate the high-speed train, or are the current rails sufficient?
Mr. Robitaille: It depends on the ultimate service that is provided, but it is unlikely that the rail as is would provide sufficient capacity to get into Gare du Palais. At this point, it’s too early to confirm where the stations would be, but it would either need to be improved to get into Gare du Palais or to have another station in Quebec City that would be close to downtown that would provide compelling service to the residents.
Senator Quinn: I only ask that because of the announcement last week about the initiative [Technical difficulties] —
Mr. Robitaille: The pont de Quebec?
Senator Quinn: — if some of that would be purposed for making sure the rail is in a condition that would allow the train to get across the river into the stations and whatnot. That’s where the station is.
Mr. Robitaille: That allows me to clarify. The new service would remain on the north shore, so it would not cross the pont de Quebec.
Senator Quinn: Okay. Perfect.
An Hon. Senator: That’s why it is going to Laval.
Mr. Robitaille: Yes, it is going to Laval, Trois-Rivières and then it would come through Quebec City, physically coming near the airport and staying on this side.
Senator Quinn: Thank you very much for all this, and I hope in the future, if this committee comes back to see how things are going, they will get the representatives from the agency. Thank you.
Senator Simons: I have two completely unrelated questions. One of them has to do with environmental assessment. The Impact Assessment Act would apply here because it’s a federally regulated rail line through two provinces.
Do you have a sense of the timeline for what the environmental impact assessment process would look like?
Mr. Robitaille: You are correct that we expect that the Impact Assessment Act will apply to the project.
Senator Simons: That’s the other Bill C-69, I know.
Mr. Robitaille: Correct. In Budget 2024, there was a statement around the target of completing the impact assessment process, as well as the regulatory process, within five years for a clean road project like this. Those would be the ballpark. But we are working closely with the agency to find efficiencies to reduce that time.
Senator Simons: This is a long line. That’s a lot of assessment.
I have an unrelated question, because you said something that made my ears prick up. You said there was something in Budget 2024 for VIA Rail service in Western Canada, which I realize is not what we’re talking about tonight. But as an Edmontonian, I can tell you that VIA Rail service in the West post-COVID became terrible. We used to get daytime train service. Now the only VIA Rail train arrives in Edmonton at about midnight and takes you to Jasper and lets you off at about 5:00 in the morning, which is a very inconvenient time, and that means you can’t take the train to Jasper in the winter to ski or in the summer to enjoy the park, which is terrible for tourism and terrible for the people who live in Edmonton and Jasper.
Can you tell me how much money has been earmarked for Western Canadian train service, or is that a completely unfair question to ask you because that’s not why you’re here tonight?
Mr. Robitaille: We cannot speak on behalf of VIA Rail with regard to their service.
I will briefly mention that in Budget 2024, the commitment is to replace the fleet that is used between Toronto and Vancouver. Those trains are now getting close to 70 years old.
Senator Simons: They’re actually quite charming.
Mr. Robitaille: They are. If you have the opportunity to take them, I encourage you.
Senator Simons: In the olden days when there was a daytime train, I did have a chance to take the train to Jasper.
Mr. Robitaille: They’re aging and getting to the end of their useful life, so the commitment is to replace them.
The budget did not mention the value of that replacement, again, similar to what we’re doing here, because there’s going to be a competitive procurement process to do this. But it is a significant endeavour to replace that fleet.
Senator Simons: Will those trains be electric? Will they be hydrogen? Will they be any more energy efficient than the current trains? Will they be faster, better?
Mr. Robitaille: I need to remain high level because we cannot speak on behalf of VIA on this. But as for the nature of the service, it will continue to run primarily on CN tracks. In this case, it would remain a diesel solution. But new diesel engines are actually much more environmentally friendly, so the actual emissions will be reduced significantly.
Senator Simons: I would love it if they would look at diesel‑hydrogen hybrid. There’s a lot of research being done on that at the University of Alberta. I live in hope.
The Chair: We all do.
Senator Dasko: How far has VIA Rail gone in terms of trying to figure out determining on what basis the train will run in terms of the operating deficit versus profit? What is the vision of the train with respect to that?
Mr. Robitaille: The government’s expectation is that on an operating basis, so not counting the cost of construction but on an operating basis, the new service will be profitable.
Right now, across the whole service of VIA Rail, there is an operating subsidy provided, both inside the corridor and outside the corridor. We’re expecting with HFR there will be a surplus or profit every year made by the service.
Senator Dasko: Is that the vision of it from the beginning? Is that the way it’s being structured?
Mr. Robitaille: Correct.
Senator Dasko: To operate on a profit basis?
Mr. Robitaille: Yes.
Senator Dasko: Thank you.
The Chair: If there are no other questions, colleagues, I’d like to thank officials from Transport Canada for answering our questions and being with us this evening. With the permission of the committee, we’ll go in camera now to discuss some housekeeping business. Thank you again for being with us this evening.
(The committee continued in camera.)