Proceedings of the Subcommittee on
Transportation Safety
Standing Senate Committee on
Transport and Communications
Issue 8 - Evidence for March 20, 1997
HALIFAX, Thursday, March 20, 1997
The Subcommittee on Transportation Safety of the Standing Senate Committee on Transport and Communications met this day at 9:31 a.m. to study the state of transportation safety and security in Canada.
Senator J. Michael Forrestall (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, I welcome to our hearings today Mr. Peter McCarron, who is the General Manager of the Cape Breton & Central Nova Scotia Railway, Nova Scotia's window on shortline railway and the experience that that entails. We appreciate RailTex's brief. It is a substantive brief, and we look forward to your going through it with us.
Mr. Peter McCarron, Regional General Manager, RailTex, Inc. Canada: This morning I would like to take the opportunity to walk you through our company in the U.S. and Canada, in relation to what we are doing with regard to safety and the interaction we have with the regulators, provincial and federal; our involvement with the public; and the concerns we have with the competitive factor as it applies to safety. At the end of my remarks, I would like to rebut a previous submission that you heard in Montreal.
I am the General Manager of the Cape Breton & Central Nova Scotia Railway. I am also the General Manager of one of our Ontario operations, Ontario L'Orignal Railway, located in Hawkesbury, Ontario. I am the Regional and General Manager for RailTex Properties, Canada, which includes the Goderich-Exeter Railway.
RailTex Canada is a division of RailTex Inc. of San Antonio, Texas. RailTex is North America's leading shortline railway organization, with 30 railways providing freight service over more than 3,900 miles of track in the United States, Mexico and Canada, and staffed by over 700 employees. RailTex also has an 11-per-cent interest in a 4,400 line in Brazil, and another 6-per-cent interest in a second 4,200 mile line, also located in Brazil. RailTex is a publicly traded company on the NASDAQ National Market under the symbol RTEX.
RailTex Inc. Canada is made up of three railways which I have already described. They are all spin-offs of former Canadian National Railways properties: the two located in Ontario, one in Goderich, one in Hawkesbury, and the one in Nova Scotia headquartered in Stellarton. We operate within a radius of approximately 16,000 square miles for a potential of over 200 shippers in a population base of over 200,000 people.
The Goderich-Exeter Railway was RailTex's first Canadian acquisition, which commenced operation in April of 1992. The GXR operates over 70 miles of track, with 14 employees, and handles approximately 9,000 carloads annually.
The second Ontario RailTex operation is the Ontario L'Orignal Railway which began in November of 1996. The OLOR operates over 26 miles of track, with four employees, and is projected to handle approximately 6,400 cars annually.
The third Canadian operation is the Cape Breton & Central Nova Scotia Railway which started in October of 1993. The CBNS operates over 245 miles of track in Eastern Nova Scotia, with 52 employees, and handles 26,000 carloads annually.
There seems to be a perception out there, at least it is felt in the shortline industry, that the shortlines are less safe than the Class 1 carriers. That will be the basis of my presentation this morning.
Part of RailTex's vision is to respond to our customers' needs in a safe, effective and efficient manner. Each employee of the corporation has made a commitment to their own personal safety and the safety of others. Safety is not a catch phrase word or a buzz word that the marketplace wishes to hear. It is the way we operate daily at our jobs and in our homes.
I will repeat: In the mind of this presenter, at least, "out there" there appears to be a general feeling that shortline operations are less safe than the Class 1 carriers. I would state categorically that our shortline railway in Nova Scotia adheres to the provisions and regulations of the Federal Railway Safety Act, in lieu of the Provincial Railway Safety Act not having been proclaimed, as yet.
In Ontario, our shortline operations adhere to the guidelines as set out in the Ontario Shortline Railways Act of 1995 which is, in effect, quite similar to the federal requirements. Adherence to the act is monitored by Transport Canada inspectors in both provinces, similar to the scrutiny given to the Class 1 railways.
With respect to investment, in the past eight and a half years, RailTex has spent in excess of $10 million. These expenditures have been on capital improvements, operating requirements, training and education.
With respect to training, all of our employees are provided with the necessary training to ensure the safety of our operations and to the general public. We have embarked upon traditional training practices that involve on-the-job training and classroom instructions with competent resources from within the company or the industry. When we cannot provide the necessary training tools, our employees are sent to locations where they can access these resources.
Our operating employees work under the Canadian Railway Operating Rules and complete the Qualification Standards for Operating Employees as similarly administered to Class 1 carriers at the prescribed intervals. Employees must qualify under the CRO Rules, Locomotive and Train Handling Minimum Standards, Handling of Dangerous Commodities and Documentation, St. John's Ambulance and CPR training.
Our repair and maintenance employees, who carry out repairs to locomotive, freight car, track, bridges and signal inspection repairs, are all trained and qualified to carry out repairs as per the minimum standards for maintenance repairs. That would be under the federal regulations.
Although we are not required to do so under certain conditions, all of our trains are operated with locomotives equipped with safety alert systems which bring trains to a stop when the operator becomes incapacitated. Each main track locomotive carries a recording system similar to the airplane's "black box". We call them "event recorders". The events of the last three days of operation are all recorded. Each main track train is equipped with a system for continuous communication of the train's air brake system, known in the industry as TIBS, for front to rear communication, in addition to the ability to apply the train brakes from the rear of the train.
With respect to dangerous commodities, a primary concern to the general public has been the handling of such dangerous commodities. In the history of RailTex in Canada, we have not had one incident involving a dangerous commodity escape that has placed our employees or the general public at risk. Our supervisory staff are sent to specialized schools for the handling of incidents connected with dangerous commodities. We have affiliated ourselves with specialized companies to handle spills and clean-ups, in order to minimize risk and danger to the general public in the environment. We feel that the regulations in regard to handling dangerous goods are being met or exceeded by our company.
With respect to our safety record, over eight years of operations our safety record speaks for itself. We have amassed over 100,000 man hours of service, handling over 110,000 carloads of shippers' traffic during this period. We have not had one fatality, and have sustained only two lost-time injuries. The CBNS Railway is approaching its forty-second month of operation without a lost-time injury. During this period, within Canada we have had only six reportable derailments: one for a derailment of cars last containing a dangerous commodity, and five for sustaining damage on other than a yard track.
Our safety monitoring in the company is carried out in three formats. In-house monitoring requires supervisory participation. There is adherence to operating, repair and safety requirements on a daily basis. This activity is supported by employee involvement in the company's Health and Safety committee. This committee is made up of employees and supervisors. The provincial Department of Labour monitors these committees.
With respect to corporate monitoring, headquarters and the railways participate in monthly meetings to investigate each incident that has taken place within the last 30 days. This Safety Oversight committee sets in train a root cause analysis of all railway incidents. The end result is a proactive plan to ensure correction through education and training. Corporate headquarters also perform safety audits twice yearly, one announced, one unannounced. Supervisors' salaries and bonuses are tied into the safety on their railways.
With respect to monitoring by regulatory bodies, Transport Canada inspectors provide quarterly inspections of all train operations, locomotive power, cars, track, bridges and signals. All reportable incidents are investigated for cause and the corrective action taken to prevent similar incidents by both Transport Canada and the National Transportation Safety Board. Our regulators are hired by the provinces, and report to the minister in charge. The railways do not have a say in these inspections. The costs for inspections are paid by the provincial railways.
With respect to public information and education, we are pleased to be associated with the Railway Association of Canada in their efforts in the Canada-wide Operation Lifesafer Program. We have personally promoted these initiatives by sending our employees out to schools and community service clubs to spread the safety message. We have further promoted these initiatives of Operation Lifesafer with the help of local police forces, who ride our trains to observe conditions. With first hand knowledge, these police forces can educate the motoring public.
In the area of safety improvements, we feel that these educational programs do not go far enough in addressing this safety concern. We require more involvement with the various highway departments in improvements to these crossings at grade. In the past two years of operation, we have experienced five collisions at crossings. All of these collisions were reported and investigated. None of these investigations have found the railways or their employees at fault. There are more vehicles than ever on the road, and less observance of railway rights-of-way. If action is to be taken to improve upon existing protection devices, it should fall under the responsibility of the provincial highways departments. In addition, more education must be provided to the provincial motor vehicle driver training programs. Federal, provincial and municipal police forces must enforce existing motor vehicle laws as they apply to observance at railway crossings at grade.
With respect to sand the competition, at RailTex we address safety in a serious fashion. Safety makes good business sense and a safe railway is a profitable railway. The public, our shippers, and our employees demand that we operate safely. We welcome the scrutiny of our provincial regulators and the emphasis they place upon our operations to meet safe operating requirements. We also accept the cost as ours to meet these safety requirements.
During the hearings that took place here in Nova Scotia prior to the sale of Canadian National's Eastern Nova Scotia railway lines, numerous briefs were presented on the value of the railway connections. Here in Nova Scotia we have provided the communities we serve with improved service. This service has added an increase in carloads of over 30 per cent from the previous owners. We have accomplished this with no assistance from any third parties other than what we could borrow and repay from revenues generated from services we provided.
I have taken this opportunity to point out the strengths of our company in regard to the emphasis we place on safety. This approach is commonplace within our industry. We do not have the expensive equipment of larger railways. We are, however, professional, and quite proud of the contribution we have made to the quality of our industry. However, we wish to see the same level of costs, regulatory scrutiny and compliance placed upon our competition to meet the same standards of safety that the public and shippers demand on our rail lines.
I have approached this panel to dispel the myth that shortline operations are not as safe as Class 1 carriers. I believe our competitors do not face the same restrictions as our industry. This is an industry bias. As a private taxpayer, I suspect that tax dollars are being used to subsidize the roadway system at the expense of our industry. More to the point: My tax dollars are not being directed towards highway safety efforts similar to those of our industry, perhaps to the detriment of my family and friends.
I truly believe that in this ever-changing marketplace, trucks and rail can coexist, and even provide joint services that benefit the industry we serve. I would like the playing field evened out, starting with the safe operation required on our highways. I look forward to the final report of this committee and its recommendations.
Mr. Chairman, I would like to make a rebuttal to a brief that was presented in Montreal on February 18, 1997. I would take this opportunity to respond to item number 40 on page 40 of a submission to this panel by the Brotherhood of Locomotive Engineers on February 18, 1997 in Montreal. It is my desire to set the record straight in regard to the facts surrounding this incident.
As there are no dates to this item, I intend to interpret that the brotherhood is referring to a derailment that took place on our Goderich-Exeter property on February 24, 1996. I can safely make this determination to this particular derailment due to the fact that the brotherhood has referred to this incident a couple of time over the past several months.
I wish to confirm to this panel today that there was indeed a derailment on the GEXR on February 24, 1996, and that it was not reported to any regulatory body. On February 24, 1996 a GEXR train crew was marshalling a 26-car train from three storage tracks. As the train movement was proceeding eastward from the second of three tracks at a speed of between four and six miles per hour, the ground person observed the rail shattering as loaded cars of salt passed over it. When the movement was brought to a stop and inspected, it was discovered that the trailing wheel of the trailing truck of the nineteenth car had dropped to the south side of the rail, and travelled approximately three feet over the railway ties. No other marks were discovered to indicate that other than this wheel had dropped off the rail.
The 18 cars immediately ahead of this derailed car were detached. A complete standing inspection of these 18 cars and the two locomotives was performed by the GEXR certified car inspector, who happened to be the outgoing locomotive engineer. The 13 cars that preceded the derailed cars had indications of "scuff" marks on the wheels. These scuff marks can best be described as small chips in the wheels, of which none exceeded one-eighth of an inch. None were out of the ordinary, as can be determined from everyday wear and tear that these wheels encounter. In order to ensure full safety of its movement, the entire train was inspected fully for any problems associated with springs, bearings, seals, axle problems, loose adapter plates, and truck centring pins out of place. There were no exceptions found to any of these appliances.
A second inspection was performed as the train was moved to further ensure a safe movement. After completing this second inspection, the end-of-train device was added behind the eighteenth car. A standard brake test inspection was performed. No exceptions were noted. The train then made its 46-mile trip to Stratford, Ontario. Nothing out of the ordinary was reported.
The nineteenth car of the movement which had the one wheel derail was placed back upon the rails and sent over for further inspection. An AAR Rule 36 inspection of the car's wheel bearings was completed. No exceptions were discovered, and the car was placed upon the first train to the consignee.
This derailment was not reported to any regulatory body, nor was it reported to Canadian National Railways, who are our interchange connecting carrier. The American Association of Railways, of which RailTex is a member, as are most Canadian railways including Canadian National and Canadian Pacific, and the Ontario Shortline Act, 1995 do not require reporting of incidents such as this due to the following: Paragraph 1 of Rule 36 of the AAR Manual describes what makes up a minor or major derailment.
A minor derailment is described as...derailed trucks on an empty or loaded car involved in a derailment at a speed of less than 10 mph or which have not moved upon the ground more than 200 feet. Inspect the bearings as follows:
We are talking about that one car, the nineteenth car, one wheel. Those ten items were checked and no exceptions noted.
AAR Rule 95 further describes the requirements of a carrier. This rule applies to us as the handling carrier. Rule 95, handling and/or delivering line responsibility reads, in part:
A. This section applies only when the handling line has knowledge of damage or loss to any car or listed appurtenances regardless of the extent unless defined in this section, resulting from the unfair usage conditions outlined below. Car must be repaired and returned to service, furnishing the owner with Billing Repair Card to cover...
As described previously, inspections were carried out as per these instructions. Canadian National Railways were not notified, as there are no requirements to do so, nor was there any need to inform them. We performed the required inspections and no repairs were required. Canadian National does not inform us of such incidents or inspections, nor do we expect them to inform us.
RailTex and Canadian National do not place cars in service with safety defects. We would not jeopardize our entire operation to move a suspect car 46 miles over our line to reduce a minor expenditure. Our business is solely dependent on our ability to operate over our trackage. It is inconceivable that we would risk our investment and the safety of our employees and the public to do so.
The province of Ontario and its regulators, Transport Canada -- Rail Surface Group, were not notified. Initially they were not notified, but as things came to pass from June of 1996 to December, Transport Canada came on the property at the request of the province of Ontario. They made an inspection in December of 1996.
The Chairman: That was some time after the incident?
Mr. McCarron: Some time after the incident. When the February 24, 1996 derailment occurred, we did not notify anyone. In December 1996, after the correspondence went back and forth from the brotherhood and various departments, they came on the property and made an inspection. That inspection was in accordance with the requirements set out in Ontario's Shortline Railways Act, 1995 under Reporting of Occurrences, by electronic means as soon as possible. If you meet one of the criteria listed here, you must report it.
The criteria are as follows: unprotected main track switch in abnormal position with no other equipment in the immediate area; a person sustains a serious injury as a result of being on board or getting off rolling stock; an employee sustains a serious injury as a result of coming in contact with any part of rolling stock or its contents; a risk or collision; movement of stock exceeds the limits of its authority with no other equipment in the area; a non-fatal crossing collision; release of dangerous goods from rolling stock that was quickly secured; a railway signal displays a less restrictive indication than that required for the intended movement of rolling stock with no other equipment in the area; unprotected overlap of operating authorities with no other equipment in the area; physical incapacitation of crew members; a trespasser sustains a serious injury as a result of coming into contact with any part of rolling stock of its contents.
A further requirement of Reporting of Occurrences reads: by telephone as soon as possible: a person killed as a result of being on board or getting off rolling stock; a person is killed as a result of coming in contact with any part of rolling stock; the rolling stock is involved in a collision or derailment carrying passengers; the rolling stock is involved in a collision or derailment and is carrying dangerous goods or is known to have last contained dangerous goods, the residue of which has not been cleaned or purged from the rolling stock; more than one piece of rolling stock not used in dangerous goods service sustains damage on other than yard track that affects their safe operation; rolling stock causes or sustains fire or explosion; runaway rolling stock; release of dangerous goods aboard a passenger train; fatal crossing collision; non-fatal crossing collision with bus or truck with dangerous goods; release of dangerous goods from rolling stock that was not quickly secured.
As you can determine from the listings, the derailment did not fit into a category where a report was required to be submitted. In addition, Transport Canada inspectors were on the GEXR to make an investigation. That is the December investigation I am talking about here. The investigation has not revealed any other information other than what I have described to you here this morning. I have also contacted the National Transportation Safety Board for a ruling on the circumstances of this incident. They have conveyed to me that this was a one-car derailment and that we have complied with the regulations.
I can only venture a guess as to the rationale behind the brotherhood's placing this derailment before this panel. My guess would be that the union was trying to embarrass the company in order to further an agenda unrelated to the mandate of this committee. Their statement that the GEXR is more concerned with the bottom line of the company than safety shows a paramount disregard for the professionalism of its members, the employees of the GEXR.
Thank you for your time, and I would be pleased to answer any questions you may have.
Senator Roberge: That was an excellent brief. I have a question on the rebuttal aspect. When the wheel came off and scuffed the railway ties for three feet, did that break the railway ties?
Mr. McCarron: No. It left marks along the top of them. It was about minus 25 Celsius, so the frozen ground and the frozen ties helped that pass along.
What also took place is that the rails shattered as they were passing over. When the employee saw it, he brought the train to a stop. When the last wheel on the nineteenth car came to a stop where the rail had shattered, it just fell off.
Senator Roberge: How could he see it?
Mr. McCarron: He was standing beside it. He could hear it.
Senator Roberge: Did he not see it?
Mr. McCarron: He could hear and see it.
Senator Roberge: You say that you have made an investment of $10 million for capital improvements, operating requirements, training and education. What portion of that $10 million is budgeted for capital renovation or capital improvements? For example, is there a yearly percentage of your revenue which goes into a capital fund for capital improvements?
Mr. McCarron: The answer to your first question is between $6 million and $7 million, for all three railways. The second question, when we make a capital expenditure under the company, it goes into a pot at corporate headquarters in the U.S.
Senator Roberge: They would take a percentage from the three Canadian companies?
Mr. McCarron: That is correct. However, I am at a loss to say just what that percentage is.
Senator Roberge: Who makes up the budgets in Canada?
Mr. McCarron: Those budgets come out of corporate headquarters in Texas.
Senator Roberge: Do they verify your needs in relation to capital improvements?
Mr. McCarron: That is correct.
Senator Roberge: You tell them that you need this, that and the other, and what they do is create a fund that is a protection for future needs?
Mr. McCarron: That is correct. We do an annual inspection. The track is the main recipient of our capital improvement projects. We lay out a five-year plan yearly of where we should be. It takes approximately 7,000 to 8,000 ties per year to keep up a 225 mile railroad. On top of that, there are switch ties, rail switch points. We have hired a welder who maintains the 39-foot and 79-foot sections of track. We do have sections of continuous welded rail, although it is only about eight miles long. That requires a lot of maintenance.
However, out of that capital money we do not pay for such things as a track geometry car that comes in and tests ballast. We contract that through Canac. A second example is that we run a test car twice a year which runs an electric current through the rail to determine any flaws, breaks, et cetera. That comes out of operating money.
Senator Roberge: Do you own your locomotives?
Mr. McCarron: They are corporately owned. We lease them.
Senator Roberge: From RailTex U.S.?
Mr. McCarron: That is correct.
Senator Roberge: What about cars?
Mr. McCarron: Primarily, the cars are owned by the various carriers. Obviously, CN would be the largest here. We do have a fleet in excess of almost 400 cars. We just finished making a purchase from Trenton Works Greenbriar of 200 gondolas for the CBNS to use what we thought would be Sydney Steel.
Senator Roberge: I gather that you are not unionized?
Mr. McCarron: Of the three properties that I am responsible for, only the one in Goderich, Ontario is unionized. The other two are not.
Senator Roberge: I am sure you have employees who have different responsibilities, but can take over another job. That is normal in many industries. Can you tell us about that, and the training involved?
Mr. McCarron: The example I use primarily is the case of one chap who was working for us as a diesel locomotive machinist. We hired him away from a Class 1. While he was employed with us, we sent him off to a training school to become a certified car inspector. That involves on-the-job training and a series of written tests, et cetera. The candidate must meet a minimum qualification. He got that under his belt.
While he was with us, we started training him as a conductor to work on freight train yard switchers, which means that he must qualify himself according to the Canadian Railway Operating Rules and everything that goes with it. At the same time, he must follow all the safety regulations. After a 10 to 12 week training period, he was qualified as a conductor. From there, we trained him as a locomotive engineer. He spent six months at various stages learning how to operate a freight train in a yard consist. From there, we trained him to be our rail traffic controller. He dispatches our trains. At the same time, he is quite a competent computer fellow, so he looks after our car control.
Senator Roberge: He will be the President soon.
Mr. McCarron: I would say so, if he keeps going. When we hire people off the street, or even if we hire people with railroad experience, we hire them for a specific task. However, the intent is that if they are not capable of handling two tasks, then we would be looking for somebody else. The idea is that they must take on at least two tasks, such as a locomotive engineer retrained to be a certified car inspector. We have hired two people specifically to be conductors, and have since trained them as locomotive engineers. They are working on their track maintenance and repair right now. Altogether, we have 52 employees, and it would be safe to say that at least 41 of them are multi-skilled, multi-faceted employees. They can handle two or more different tasks.
I am talking about the CBNS. That is what I am most familiar with. It is the same idea for Ontario. At our property in Goderich, even though they are unionized, they are not job specific. There is still that flexibility.
Senator Roberge: You have negotiated that flexibility?
Mr. McCarron: Yes, sir.
Senator Roberge: Is there a big difference between the Ontario act and the federal act?
Mr. McCarron: Hardly any.
Senator Roberge: What about the U.S.?
Mr. McCarron: I believe, personally, that our Canadian laws are more stringent.
Senator Bacon: I would refer to page 9 of your brief, and also to the Brotherhood of Locomotive Engineers statement that was made to us in Montreal.
You say:
Our supervisory staff are sent to specialized schools for the handling of incidents connected with dangerous commodities.
Mr. Houston, of the Brotherhood of Locomotive Engineers, says:
Hence, today we might be a conductor, tomorrow we might be a yard clerk, and tomorrow or the next day you might be the locomotive engineer, and the day after that you might be laying track.
Are all of the employees trained for dangerous commodities, or is it only the supervisory staff that are trained?
Mr. McCarron: Under the Quality Standards for Operating Companies, QSOC, there is a minimum three-year time frame during which you can go without studying for and writing the examinations associated with it. Part of that is made up of dangerous commodity handling documentation. Each and every employee who handles those commodities must have a minimum pass of 80 per cent. That is done every three years.
At the same time, every day, every week, every month, there are always upgrades. Everyone is made aware of any changes, and brought up to speed on any changes in the industry requirements.
Senator Bacon: Do you mean that all the employees are fully knowledgeable and are trained?
Mr. McCarron: They are trained, yes.
Senator Bacon: Not only the supervisors?
Mr. McCarron: They are trained up to a point. When they are on the trains and should an incident occur, we call them first responders. There are set rules and procedures that they must follow if they are involved.
Obviously, with no cabooses, they are all located at the head end of the train. They have all the paperwork. It is a requirement that they know what the location of the train is. Should something occur, they go back to make an inspection, with the knowledge that, 18 cars back, there is a car of propane or a car of chlorine, or whatever. If there is an indication that there is a problem on one of these cars, they have documentation and manuals that they carry with them at all times that instructs them, the use of which has been part of their training. In other words, the resource manual says such things such as, "I must stay downwind, upwind, stay 500 feet away..." et cetera.
Senator Bacon: Then everyone would know what to do in such a circumstance?
Mr. McCarron: Everyone is trained, and that training supplemented with written documentation to assist them.
Senator Bacon: You mentioned, and we have been told, about collisions at crossings, and the safety improvements to these crossings. However, there are still quite a number in Canada. You have reported on them and investigated them. What would be the main problem?
Mr. McCarron: This is only an opinion. We run down the track at 30 miles an hour, steel on steel. We do not stop very quickly. We set up advance warning signs on highways to indicate that there is a railway crossing ahead. Such crossings are all fully marked. Depending on the volume of traffic, some are lit with bells; again, depending on the track, some have gates on them. My opinion is that many of the incidents are caused by inattention on the part of the motoring public. They come up to the crossing and they pay no attention to the advance warning signs, or the signs.
In addition, very few places have city or municipal ordinances which prohibit the trains from blowing the whistle and ringing the bell. We have 217 crossings between Truro and Sydney, and believe me, everyone has called at one time or another, complaining about the whistle and the bell. How can people driving cars miss them? We are not quite sure.
Senator Bacon: Is there a program for substance abusers? Do you have any prevention program, or a zero tolerance policy?
Mr. McCarron: Zero tolerance on the job?
Senator Bacon: Yes.
Mr. McCarron: Yes, we do. That is covered under CROR Rule G. At the same time, we have an employee assistance program. We have an employee assistance officer in the company. This person is usually an employee. It is part of our health care plan of which the employees can take advantage in dealing with any substance abuse problems or other personal problems.
Senator Bacon: What would happen if someone is caught on the job with an alcohol problem?
Mr. McCarron: That is an operating rule under the CROR Rule G. That means immediate dismissal.
Senator Bacon: Is that the company's rule?
Mr. McCarron: That is an industry standard. That is no different than CN's or CP's rules.
Senator Bacon: You said that your company has someone who specializes in meeting with the employees who have problems?
Mr. McCarron: Right. We have affiliated ourselves with appropriate organizations which can provide counselling, whether it be on alcohol, drugs, gambling, or personal problems. We have made that available to our employees. This party has no involvement with management, so there is a certain element of confidentiality there.
Senator Bacon: Do you have random testing, or mandatory testing?
Mr. McCarron: No. We would like to introduce a policy whereby if there was something of a suspicious nature that would lead you to believe that it played a role, I would definitely say, in order to put the public conscience at ease, that we would perform such tests to verify the situation, one way or the other.
Senator Bacon: Would you be ready to go that far if it became a problem?
Mr. McCarron: In the interest of public safety and the safety of the employees who work for the company, yes.
Senator Roberge: For dangerous goods transportation, would you be willing to institute mandatory testing?
Mr. McCarron: If it added another element of safety to the whole operation, yes.
The Chairman: At the bottom of page 18 of your brief you are dealing with the derailment on the Goderich-Exeter line. You say:
I have also contacted the National Transportation Safety Board for a ruling on the circumstances of this incident. They have conveyed to me that this was a one-car derailment and that we have complied with the regulations.
Was that a verbal or a written communication?
Mr. McCarron: That was a verbal communication with a gentleman by the name of Kim Nellis out of Sarnia, Ontario. He is responsible for the eastern Ontario lines.
The Chairman: Would you not feel more comfortable with a written communication?
Mr. McCarron: No, I am quite comfortable with the actions that were taken on February 24. We are well within the requirements. We are talking about a one-car, one-wheel derailment that travelled three feet. I would compare it to you having a flat tire driving down your street.
The Chairman: However, it was a question of verbal as opposed to written. Anybody concerned with due diligence might say, "He said it but how do we know it?"
Mr. McCarron: The fact that I did not get a written communication does not lend any credence to what the brotherhood is trying to put through here. The incident was as I described: a one-wheel, one-car derailment, with a non-dangerous good on a yard track. It does not require that kind of scrutiny.
The Chairman: It seems strange to me that that would not require a written communication. However, it is not your practice that is under scrutiny here. It is the practice of a regulatory agency.
Mr. McCarron: It was just a CYA thing on my part, in case you asked that question.
The Chairman: I will, perhaps, wonder out loud to the appropriate agency why they do not make these responses written, or at least fax them so that there is a record. I am attempting to end controversy, not prolong it. However, I asked the question and you answered it fairly. I accept that, unless there is something you want to add.
Mr. McCarron: I am trying to stay out of more paperwork.
The Chairman: That is a good answer. That may be the reason. The overabundance of paper sometimes can be an annoyance.
Senator Adams: An employee such as a locomotive engineer who drives a train and also repairs railway ties, is he on strict salary and regular hours?
Mr. McCarron: These employees, for the most part, are on an hourly basis. Within each company of RailTex of Canada, we have an operations group that handles the movement of freight trains. They basically stick to one area of responsibility. We have a crew that does track repairs. They stick to basically one responsibility. We have car repair and locomotive repair. They stick to one basic responsibility. Our ability to move a locomotive engineer into track repair is on an ad hoc basis, as required.
The idea is to keep employees working as much of the year as we can. If there is only six months' work as a locomotive engineer, then maybe for the summer track program we have this person go over and do that type of work. I want to clarify; it is not one day's work as a locomotive engineer, then the next day replace ties, and the next day repair cars. It could happen, but that is not the way it actually works.
Our employees are paid on an hourly basis. In Nova Scotia, we work under the Nova Scotia Labour Act. In Ontario, it is obviously under the Ontario Labour Act. We have revamped that a couple of times. We have gone from a 48-hour work week to a 44-hour work week before overtime kicks in. We do not work our employees more than the 44 hours. It is probably 40 hours, and it is on an hourly basis. If the lowest paid guy was a diesel locomotive mechanic making $16 an hour and he was qualified as a locomotive engineer, and if that was the highest pay at $19 an hour, we would pay him the $19 an hour, regardless of what job he was doing.
Senator Adams: In another committee, we heard that at CN there is a regulation under the unions that locomotive operators are allowed to drive for only eight hours a day. We also heard that they make approximately $80,000 a year. How does that compare to your company?
Mr. McCarron: If you are using locomotive engineers as an example, we try to have them work between 40 and 44 hours per week. We set the schedules up to accommodate that. We have adopted the portions of the federal act that were put in place after Hinton, that said you had to have X number of hours of rest after so many hours of service. We have enhanced that. We limit our people to 12 hours a day. If you are operating on a train, we take you off and put you to bed prior to the expiration of your 12 hours. You must have a minimum of eight hours off between shifts, regardless.
The Transport Canada regulators who do the federal end of it like our rules a lot better than the federal ones because they are cut and dried. Everybody takes eight hours off between shifts. You do not work any more than 12 hours per day. There are opportunities for people to make more money. I do not think you would see $80,000 a year made on one of our lines, but our engineers do not miss it by too much. However, they do not work those kinds of hours, either.
Senator Adams: We heard from CN that there is a lot of trouble with bearings overheating in the cars. Every 25 miles, they have heat detectors for bearing overheating. They have a contract with a company in the United States because they could not find a company in Canada to do that kind of maintenance. CN also told us that some companies are buying rail tracks and they do not know what type of steel is being used for those tracks. Are you familiar with all of that?
Mr. McCarron: Yes, very much so. That is part of the myth that is out there.
In Nova Scotia we accept traffic from Canadian National Truro. We do a full-fledged inspection and interchange as per the requirements. We locate our hot box detectors based on the population. We have four of them in Nova Scotia. We maintain and operate a car repair facility in Sydney, Nova Scotia. We have three certified car inspectors who actually are all ex-Class 1. The youngest guy had 17 years service with them. They have all met the requirements and passed the appropriate tests to inspect and make repairs.
If our hot box detector picks up a heated journal and we can move it to the shop and repair it, then we do so. We purchase our wheels from the same companies where CN and CP buy their wheels. They must come with a verification or a warranty or guarantee, the same as is given to CN. They are placed back in service with qualified individuals.
Senator Adams: Will your purchase orders tell you what type of bearing to put in?
Mr. McCarron: That is part of the requirement when you change a set of wheels. We go back to the owners of the car and say, "Your wheel went defective and we have replaced it. It is $2,200 for that wheel. We want our money back." They will certainly not pay for something over the phone, or a bogus bill, or whatever.
We are all members of the AAR, and you must submit to the minimum standards as contained within the AAR regulations. The consequences are serious fines. That is an example of the industry regulating itself.
Senator Adams: Do you have regulations for a payload for flat cars and box cars? When I asked this question of CN, it sounded as if they had quite a few accidents. Perhaps it was because of overloading box cars or flat cars.
Mr. McCarron: Overloading is minor. Out of approximately 26,000 cars, it is safe to say that we had only four that were overloaded. We are provided with a scale ticket before we accept goods from customers such as Cape Breton Development Corporation. Cars coming in through that interchange at Truro are always supplied with a weight. Each car is stencilled; you can tell what the load limit capacity is on each car. You can compare that to the billing associated with it. We can handle overloaded cars, but there are restrictions that are placed on how you do handle them, and at what speeds. This has not been a major problem.
Senator Adams: The Safety Board at CN reports accidents on their railway. Their reports have been distributed to ministers' offices, but often they do not hear back from them. We heard from people in Montreal that when there is an accident, and a report is generated, there are employees who do not know what happened, especially with dangerous goods.
You have a board of directors, but perhaps you do not have a Safety Board, as does CN. Do you worry about that?
Mr. McCarron: On each incident, say it was with respect to a dangerous commodity derailment, that report goes where?
Senator Adams: To the minister's office, and the minister seldom replies. That is what we heard in Montreal.
Mr. McCarron: I do not know what happens when it leaves here. The requirement in Nova Scotia is an immediate phone call. We respond to -- I believe it is now called the Department of Transportation, Supply and Services. We report verbally to one of the senior policy advisors there. They, in turn, have hired Transport Canada out of Moncton, New Brunswick, the rail service group, to be our regulators. Regardless of the incident, the National Transportation Safety Board gets involved. Then we send a report off to our corporate headquarters. There are four reporting items there.
The Transportation Safety Board will make a determination as to whether they should be on the scene to investigate. Transport Canada will make the same determination. We have had them on the property for various incidents. The final report goes to these offices, and they make recommendations based on that report. The National Transportation Board publishes, monthly or quarterly, a fold-out of various incidents and the cause, effect and proactive stance that should be taken from each incident.
Senator Adams: CN has closed down quite a few of its shops. If a bearing breaks, they have to ship it a long way, either to Winnipeg or Vancouver, to have it repaired. Do you have a different set up?
Mr. McCarron: With CN being our primary supplier of cars, we do not get involved with their repair schedule, or where they are being repaired. We are only concerned that the cars they give us are in good order, and they are. We inspect them at interchange. Then, when they come on our property and we find that they do not quite meet our requirements, we will make the repairs on them. That is no different than CN, CP or one of the lines in the States would do to our cars. To put it in perspective, you do not buy a car so you can take it back into the shop every month to have it repaired. They want them to run for a year or two years.
The best example of that is the way in which they are buying locomotives. Everybody wants a bright, shiny, new 6,000 horsepower locomotive. However, when they cost $3 million a pop, you do not want them in the shop every month, so they might go six or eight months without having to go into the shop. You are getting what you pay for.
Senator Adams: We want to find out why at CN they have a problem with accidents. You have been operating for approximately ten years now and have had only one accident.
Mr. McCarron: No. We have had six reportables. We have had our flat tires. It is safe to say that our reportables are caused more -- perhaps 90 per cent -- by human error than by an equipment problem. We train people to inspect and pick up these things. We buy electronic equipment, like hot box detectors, and we maintain them and keep them maintained to detect things such as heated bearings, wheel cracks, et cetera.
The Chairman: On page 8 of your brief, the third paragraph, you indicate that the repair and maintenance employees are trained and qualified to carry out repairs per the minimum standards for maintenance repairs. Is that your own operating manual or is that the Transportation Safety Board's standards?
Mr. McCarron: We have adopted the federal regulations there. At the sale of the property, we made a commitment that we would follow the federal regs because Nova Scotia did not have a Railway Act.
The Chairman: You suggested that you might try and be a cut above that. Have you been able to do that?
Mr. McCarron: Yes, sir.
The Chairman: With respect to safety down the road, and given the nature of the beast, you took over a fairly good roadbed from Truro to Sydney?
Mr. McCarron: I like to compare it to buying a second hand house. You have a lot of wallpaper to strip, paint to redo, and new carpets. It was in fair condition.
The Chairman: But you do not wallpaper and repaint tressels. How many tressels do you have between Truro and Sydney?
Mr. McCarron: I am at a loss to respond to that.
The Chairman: You have quite a number?
Mr. McCarron: We have quite a number. We have hired an outside consulting firm out of Toronto. We have set up a five-year plan on our bridges. They come in yearly, inspect all our bridges, and lay out a working plan for what has to be done now, and what has to be done in two years, three years and five years. Every year, we revise it.
The Chairman: Your revenues are healthy enough to sustain the funds you will need to make sure this happens?
Mr. McCarron: What we will do is, under our capital expenditures program, we will highlight one bridge, two bridges, whatever the case is, and put it in our capital program for the following years. We will do two this year in Nova Scotia.
The Chairman: You will do two?
Mr. McCarron: Two.
The Chairman: Big jobs?
Mr. McCarron: One of them, the Ottawa Brook one, will be quite an undertaking.
The Chairman: Must you shut the line down for a bit?
Mr. McCarron: We will work around, say, the weekends or something like that, when we get into the major work, but no, we will not cease operations. We only run two trains a day, so quite a bit of the rest of the day is left.
The Chairman: Just one other one question with respect to passengers, and the future.
Mr. McCarron: Our company line is that we are not a passenger-carrying business.
The Chairman: I know that.
Mr. McCarron: But we are into negotiations now with two different groups to run a service on our lines between Sydney and Truro.
The Chairman: Talk to us then, briefly, about the additional burden that that might place upon you with respect to passengers and safety?
Mr. McCarron: A whole different set of rules come into play when you are running passenger service equipment over your line. The inspections are more frequent, the elevations for your curves have to be a little tighter, your roadbed must be a lot stronger, ties that perhaps might last another year for freight will not accomplish what you want for passenger train service, et cetera. That means more of an investment and more inspection, scrutiny placed upon our rail line.
The Chairman: You are in the process of exploring that?
Mr. McCarron: We are, yes.
The Chairman: You have not taken the initiative?
Mr. McCarron: No, we are a freight service.
Senator Roberge: With the years of experience of operating trains, not only in your case but generally across North America and Europe, and all that, are there ways to measure metal fatigue? What would be the lifespan, say, of a wheel and a track?
Mr. McCarron: I am not in a position to respond to that question for lack of knowledge, but there again, if you are running 100 freight trains a day between Toronto and Montreal, your track fatigue would be a lot more than if you are running one or two.
Senator Roberge: Sure, but that can be calculated.
Mr. McCarron: There must be a process in place to measure that.
Senator Roberge: I was just curious, because I missed any CN information on that point.
Mr. McCarron: I am sure there is such a process, because that would go into long-range planning for a company such as CN, CP.
Senator Bacon: Maybe you could enquire, and if there is any more information on that point, you might send it to the committee.
Mr. McCarron: On metal fatigue?
Senator Bacon: Yes. That could be interesting.
Mr. Bruce Carson, Senior Advisor to the committee: We have canvassed the rail industry fairly carefully. I think the only company we have not heard from is VIA Rail, and we will be hearing from them in Ottawa. We have heard from the unions, and we have heard from you and from CN and CP, and we continually get contradictory evidence with regard to safety. I will give you an example, and it is a small one.
When CN appeared before us in Montreal, they went to great lengths to explain to us how the belt pack, that people standing on the ground can use to move trains around, was a great innovation, and very helpful for safety. The unions come forward and tell us that it is not, and that having trains run without an engineer around the railroad yard creates real problems for safety. We are continually faced with this type of thing, and the best example, of course, is the Goderich-Exeter incident that you addressed this morning.
You have been fairly forthcoming with us this morning, so I have two questions for you: First, in your opinion, why are we running into this kind of contradictory evidence? Second, have you had any discussions with the unions involved in the Goderich-Exeter incident since they appeared before us in Montreal, in an attempt to resolve this kind of discrepancy in how you approach the same subject matter?
Mr. McCarron: Sorry, what was your first question again?
Mr. Carson: My question is whether you could perhaps explain to us why you think we keep getting this kind of contradictory evidence while dealing with the same subject matter and trying to approach it from two different angles. Then second, have you had conversations to try and clear up what happened with regard to the testimony we heard in Montreal?
Mr. McCarron: The answer to your first question is job security, plain and simple, with fifty per cent of the people moving off of that function. Let us be realistic: When the person is on the ground, he is directing the locomotive engineer; he is his eyes and everything out there. If that gentleman -- or lady -- is on the ground with a belt pack, he -- or she -- is doing it all themselves. It must come down to job security, and the number of jobs that will be lost with the introduction of the belt packs.
The answer to your second question is no, I have not talked to the union representatives from the Goderich-Exeter Railway since that submission. I fully intend to do so the next time I am in Goderich. The Goderich-Exeter Railway now has an acting general chairman of its own. It is no longer administered from Nova Scotia. Next time I am in a Goderich, he and I will be having a face-to-face meeting.
The Chairman: We are pleased to have with us now the Irving Transportation Group, in the persons of Mr. Jack Walker, Sunbury Trnasport Limited, and Mr. Scott Smith of J.D. Irving, Limited. With them, we will have the chance to look at surface transportation, and the Irving Group have crept in where angels fear to tread. I am sure that when you have completed your submission to us today, we will be more enlightened and familiar with the difficulties that face modern road transportation.
Our concerns are, of course, the situation as it is today, but more important, where we might hope to be in terms of your field, highways, and other methods of control and safety, through to the year 2010. What must we do to get there, how do we get there safely, and how do we foresee what the requirements will be?
The purpose of this travelling Senate subcommittee is to attempt to identify problems relating to transportation safety. The second aspect of our work will be to present some solutions to those problems. We are trusting that you gentlemen will be able to help us in that regard.
Mr. Scott Smith, J.D. Irving Limited: We are representing today the over-the-road sector of the Irving Transportation Group, the group of companies that is made up of the Midland Transportation Group, RST Industries, and Sunbury Transport Limited. These companies are all based in the maritime provinces, but operate throughout Canada and the United States. Combined, we manage approximately 3,500 pieces of equipment with 1,050 power units, and employ approximately 1,850 road, terminal and office associates.
We appreciate this opportunity to present some of our views to you. We have purposely kept our comments to a few key issues, but would be pleased to respond to any questions that the committee may have.
First, let me state clearly that we believe safety makes good business sense. It is a top priority in all of our businesses, and our performance will attest to that. We work on the philosophy of continuous improvement, and our approach to safety reflects that philosophy. Tomorrow we will be better than we are today. Our chief concern is with those who do not share that philosophy.
I would like to touch first on hours of service. Driver fatigue is a much debated topic. The impact of driver fatigue on accident statistics can only be evaluated accurately in the most extreme of circumstances. Our current hours of service regulations may well be outdated and not fully effective. Authorities in Canada and the United States continue to conduct extensive studies that suggest a different approach may be required to address the issue of driver fatigue.
With respect to carrier responsibility, carriers that employ drivers and brokers to transport their freight assume a major responsibility. The assumption is that if a truck driver is licenced, then he or she is qualified to perform the job safely. We believe this assumption is incorrect, and that carriers should be required to provide new hires with adequate training so that they may perform their jobs safely and efficiently.
In any system, in this case the transportation system, each party to the system must have certain responsibilities as well as accountabilities. Product loaded by the shipper implies responsibility that weight, securement and dimension regulations are met. Shippers should be accountable for loading trailers to all safety and securement standards. When shipping heavy cargo, shippers should have the means to ensure that axle and gross weights are not exceeded before the equipment leaves their facilities.
Generally, we believe the current laws are adequate. The major problem, and to us the most critical issue, relates to consistency of enforcement. There are two aspects to this: First, there is inconsistency from province to province and state to state. Carriers operating across the continent are challenged to keep abreast of the various standards in the various jurisdictions. With differing laws, it is unreasonable to expect consistency in the enforcement of truck safety laws. Although greater consistency of application is difficult, support groups such as the Commercial Vehicle Safety Alliance strive to improve uniformity of both laws and enforcement standards. Government regulators should also work with each other to improve consistency.
Second, within jurisdictions, there is inconsistency in the application of regulations. The trucking industry is very competitive. Deregulation has had the effect of maintaining -- and in some cases reducing -- the cost of transportation services. Truckers compete for the same business, and margins are thin. For the trucking company that puts genuine effort into complying with regulations and improving its own safety standards, the cost is significant.
Safety is a team effort involving a large number of people. Safety department staff are charged with the responsibility of guiding and overseeing the quest for improving the safety track record and checking compliance with regulations internally. In addition, they are responsible for the development and implementation of driver and owner-operator training programs. There are also road units that check for compliance in the field. Planners match loads and power units, but only after due consideration is given to available driver hours, delivery time, et cetera. Fleet managers have a number of drivers and owner-operators under their responsibility. They monitor many factors with safety related issues such as truck speed, driver hours of service and incident follow-up, to name only a few.
When application of the safety standards is not uniform, the safe operator is disadvantaged relative to the operator who disregards safety regulations. This creates a condition whereby the safety-conscious driver who meets logbook requirements can travel fewer miles, and therefore earn less money than the driver who avoids logbook requirements. The same condition occurs for their respective companies when quoting on freight. The company that incurs the additional cost to allow for safe operation has greater difficulty in competing against the operators who do not place an emphasis on safety. Lack of uniform enforcement provides a disincentive for the safe operator to keep on being safe. We must have methods to encourage safe performance.
Safety is monitored primarily through roadside checks and carrier audits. With the number of inspectors in the field, it is difficult to effectively monitor all carriers. Government restraint precludes adding inspectors, and therefore ways must be found to accomplish more with less.
We are in an era when non-compliance with regulations should be penalized, and compliance rewarded and recognized. As stated earlier, lack of penalty for non-compliance creates a disincentive for carriers that comply. We would like to concentrate, however, on carriers that work at complying. We believe these carriers should be recognized and benefit from their efforts. If carriers that consistently receive high ratings in inspections and audits are bypassed in some roadside inspections, they receive benefit and recognition. This would allow inspection resources to concentrate on carriers that have not demonstrated a positive safety history. Perhaps there is a way to reduce paperwork or certain fees to the high-end carriers. Whatever is done, there is a need to encourage the safe operator to keep up and improve his safety standards.
The Irving Transportation Group has implemented a drug and alcohol program. A brief discussion of the development and implementation process will help to underscore some of the points made earlier.
First of all, our program highlights our drive to continually improve our safety levels. We have spent $300,000 in developing and implementing the program, and will spend approximately $200,000 a year to accomplish the needed testing levels. We have completely updated our employee assistance program. Our emphasis is on prevention, treatment and rehabilitation, as we believe that a preventative approach is the best one. Although this is certainly the right thing to do, again, there is a cost which is currently estimated at a minimum of $200,000 a year.
The next point in the drug and alcohol program relates to consistency, as was mentioned earlier; consistency across jurisdictions. A major concern is that the United States Department of Transportation requirements for alcohol and drug testing of commercial motor vehicle drivers have not been adopted in Canada. As a result, Canadian trucking companies that introduce alcohol and drug testing are subject to human rights challenges and labour grievances. We are very concerned that certain types of drug and alcohol testing, for instance random testing, will not withstand legal scrutiny in Canada. However, this type of testing is specifically required by U.S. DOT regulation. If random testing -- or for that matter any other type of U.S. DOT sanctioned testing -- is held to be illegal in Canada, Canadian trucking companies could have no choice but to stop doing business in the United States. Loss of this business would obviously have a dramatic effect on the Canadian trucking industry as a whole. We strongly believe that Transport Canada should introduce similar alcohol and drug testing legislation as that introduced by the U.S. DOT. Our on-the-road associates, we believe, would support such a move, based on results of a survey conducted in one of our companies which indicated in excess of 95-per-cent support.
This example demonstrates the effect of inconsistency of regulation across jurisdictions, as well as the cost associated with companies wanting to improve their safety performance. These costs are only the tip of the iceberg relative to the total cost of safety in organizations that commit to improving performance. It is critical that these additional costs not disadvantage organizations in the marketplace due to inconsistent enforcement.
In conclusion, the Irving Transportation Group is committed to ongoing improvement of our safety standards. Our actions support our words. There is no question that truck safety throughout the industry must continue to improve. Current laws and regulations may require modification to reflect new data or information, such as driver logs and alcohol and drug testing, but generally there is sufficient regulation in place to do the job. The missing ingredient, to our thinking, is consistent enforcement with penalties for non-compliance and recognition for a job well done. This must be the cornerstone of any successful program.
Mr. Jack Walker, General Manager, Sunbury Transport Limited: I certainly support everything that is in our brief, and the drug and alcohol question is one that is pretty near and dear to my heart. We started pre-employment testing in Sunbury in 1991. Basically, we went to the existing drivers who were driving for us at that time and said, "What do you think? Should we do it or not?" and, as our brief disclosed, 95 per cent said, "We do not want not to know who is behind the wheel, or what condition they are in, running alongside of us." Certainly, my opinion is that the drivers out there are pretty proud. They want to do a good job, but they want everybody else to do a good job, too.
Senator Bacon: I would say it is an issue that is dear to my heart, too. Wherever we go I ask the questions about that, but I think it is very commendable to see what you have been doing, and that the employees are totally in agreement with what you have started.
Mr. Walker: A practice in our company is that five members of senior management will interview every driver that we put on the road, be it a driver or an owner-operator. I know that I, personally, asked that question, "What do you think of this particular drug testing?" and I have never had anybody say, "I do not want it."
Senator Bacon: It is commendable, because we have not heard that. Wherever we went, people are always reluctant, because usually I ask the question, except for this morning. A representative of RailTex answered questions, and we never have answers. I really commend you for the program that you have already adopted in your company.
Mr. Smith: Generally the attitude is, "Well, we have nothing to hide, so what?"
Senator Bacon: That is what we thought.
Mr. Smith: The other thing that we do in our organization, all of our positions are safety sensitive -- myself, Jack, everybody; we are all part of the program. It is not just this group or that group.
Mr. Walker: Whether it be the mechanics within our shop, the drivers, and certainly our senior management; all are part of it.
Senator Bacon: While the United States limits truck operators to driving no more than ten hours in one day, Canada permits up to 13 hours. In your opinion, do the increased hours of work pose a safety hazard for the Canadian trucking industry, and would standardized hours of work for the Canadian trucking industry result in an economic hardship for the transport sector?
Mr. Walker: My feeling on that point is that there is some confusion created by the 10-hour rule there and the 13-hour rule here, and drivers crossing the border must juggle those hourly difference. That is where the safety issue arises. It is not whether drivers work 13 hours or ten hours, in my opinion. If a carrier is not asking them to operate beyond the hourly limit, be it 10 hours or 13 hours, these fellows are not willing to take that risk, deep down. They want to get rested and they want to comply. My opinion is that they are trying to beat the rule at the border, heading south or heading north.
Senator Bacon: Are you saying that that is the main problem?
Mr. Walker: That is my opinion on it.
Mr. Smith: There are studies out, and more studies occurring, on fatigue, be it in the rail industry or in the trucking industry, and information is emerging from these studies that we probably did not previously have. That information must be evaluated in relation to any kind of regulations that affect hours of driving. I am not sure whether 10 or 13 hours is right; it is what has happened before those hours and after those hours, or even during those hours, that can have an effect. There is data that says that the highest-risk hours are in the wee hours of the morning. I think all of this information must be looked at in designing new regulations with respect to hours of service. To say a driver can only work eight hours, and from this time to this time, what you are doing is condemning that person to 16 hours -- if it happens to be eight hours -- in a six-by-six foot box, and he or she will go nuts. The only other option is to go into a truck stop and spend money which they do not have.
Somehow, regulations must be put together which create a condition whereby drivers do not feel that they must try and get around the driver logs; that if they are in a good condition, they can drive. I cannot tell you how that can be done. All I know is that to say if you have driven 10 hours or 13 hours therefore you are okay, but in the fourteenth hour you are not okay, is not valid. You could be unfit to drive after one hour, in certain cases.
Again, with respect to how all of that is packaged, I wish I could provide you with an answer. All I know is that the hard and fast rule will not be the answer; for example, drivers who put in their maximum number of hours and then are hit with the three-day layover rule. If that driver is 1,000 miles from home and must sit for three days while waiting to move, that does not make any sense. He or she will probably be more tired after three days in a parking lot than if they perhaps had a mandatory 24-hour rest, and then they can be told to go home, but that is the only direction in which they can go. What I am saying is that we must use some imagination in developing new regulations.
Senator Bacon: What kind of recommendation would you like the committee to make on that matter?
Mr. Smith: I do not have an answer to that. Nor do I know whether Mr. Walker does, either. In my opinion, the research that has been done must be studied, and recommendations evolved out of that. I am not a knowledgeable person in that area of expertise and I cannot give you an answer.
Senator Roberge: Have the studies not been finalized, or are there still studies to be done, more analysis to be done in order to arrive at a consensus?
Mr. Walker: The Canadian Trucking Association is putting a great deal of effort into that right now. They have been to Australia, where they seem to have a totally opposite way or working; where they regulate sleep, apparently. I do not understand quite what is entailed in that just yet, but certainly, taking what are known quantities, and I would say involving some senior drivers who have been out on the road, and coming up with a consensus that is acceptable to the North American market, I do not think it will look as it does right now. I would suggest that these people -- the drivers -- can regulate themselves and decide when they are tired and when they are not, and document it in the way they are doing it. Right now, if you were to inspect a logbook at random, I would suggest that a large percentage of the entries written there you might not want to believe.
To me, it is rather what will work for the driver who is out there, behind the steering-wheel, who is 1,000 miles away from home, and caught up with having to wait two days or three days to get his log hours intact again to run. Certainly, within 24 hours they are pretty well rested. After all, we all drive cars and on occasion have driven them non-stop for 15 hours. As a driver, you know you must go to sleep at that point. Eight to ten hours later, you are ready to go again.
Perhaps a driver will have 70 hours' driving in 8 days. I do not know whether that catches a lot of them, because they drop off a day and catch a day, but they cannot gather together enough hours even to get home. That is pretty important to these people, and I can tell you that it is getting to be a bigger issue with every day that passes, and the different types of drivers who handle these vehicles. Quite frankly, they are very responsible people, going in.
The Chairman: What kind of a run presents the greatest challenge to your driver? Is it a run from here to Mexico for tomatoes, or is it a run down to Boston with Christmas trees? Is it the really long hauls that are presenting the logbook problem, or is it the marginal runs, such as, say, Halifax to Ottawa, or Halifax to Montreal?
Mr. Walker: It is easier to get your logbook hours on a long haul in line, if that is what you care to do, because you are not stopped unloading or reloading, or caught with paperwork. You are checking your vehicle, taking your rest, and then you are on the road again. Where they get caught is when they are loading and unloading very frequently, and they become short of hours. They could get tied up in traffic in big cities -- New York City is a prime one. They could take three to fours hours just to get out of that city, having travelled no distance at all, and basically picked up no money, because most are paid by the mile.
Senator Bacon: When you mention the logbook, is it like a black box on planes or is it the driver writing his own agenda?
Mr. Walker: The driver has a book that he must fill out for lines -- and I am going from memory here, because I have not filled one out -- you have off-duty and on-duty status, driving on-duty, not driving. They must draw lines filling in the hours, identifying where they are, identifying the mileage of the truck, every change of duty status. I will tell you quite frankly, we spend half a day training people on logbooks; people who have 20 years' experience, because they do not know the regulations. Up to that point, they have been self-taught, and that is what we are dealing with out there. A big issue.
The young people who attend these schools and whatnot are not familiar with logbooks. Until they get out and practice it, and get some counselling and coaching to make all of that work, they do not know where they can pick up 15 minutes on the logbook, or half an hour, that they legitimately do not have to charge themselves with driving. Then they come up against a DOT inspector, and he fills out a toll ticket and the driver is off an hour on his timing that he has put on there, and then there is a real issue, because in their determination he falsified a log. Some of them are legitimate.
The Chairman: I have heard -- and for the moment I have forgotten just where -- the very interesting story of one major company calling all the drivers in over a period of time, and the manager himself coming to the point and trying to explain how to deal with the logbook situation, and realizing that he himself did not know. There were so many imaginative ways of interpreting the rules. I see another witness behind us nodding his head in agreement, because this happens in other modes of transport, and it is terribly serious. How do we cope with the U.S.-Mexico, Mexico-Canada bilateral trucking, if we still have not managed to deal with a trip from Halifax to Montreal?
Mr. Walker: It is a question of education. As a driver, not only must he check his vehicle and know how the system works, as far as circle checks and documentation and mechanics, but he also has the handling of hazardous material now that he must learn, all of the codes and the procedures that must happen. Then he has to know about the logbook, and then the driving regulations, and he must also have a good knowledge of the vehicle specifications, in order to operate between jurisdictions.
The Chairman: Referring to those long, articulated tractor trailers that we are seeing more and more often on our highways -- and it seems to me that they are getting longer and longer; we are now seeing up to three trailers, particularly in the western provinces where, given the long, straight roads, that configuration might be somewhat feasible, but to be going in and out of, say, Bear River, in my opinion a driver would not want to be lugging three trailers behind his cab. Would the number of trailers make a difference to a driver's hours? In other words, should a person driving a large vehicle like that drive the same number of hours, or should it be a lesser number? Would there be any economic advantage, say, instead of a person driving 14, 15 hours a day and cheating, if he is carrying that extra tonnage or whatever, that he could make up the revenue he would otherwise lose by only driving 10, 12 hours? Is that a factor in the equation?
Mr. Walker: I do not believe so. With respect to the heavier vehicles, we operate a fair number of those, in fact about probably 25 to 30 B-train equipment that gross 137,000 pounds on the road, and quite frankly the drivers like that type of vehicle. It is, in their opinion, easier to manoeuvre around city streets and has better braking capacities. We do control the road speed pretty much on that type of vehicle. Sixty miles an hour is tops, and we govern them at that. However, once we get them accustomed to that, they do not want to drive any faster. They know when they are tired, and they want to get out of that vehicle.
I am personally a supporter of B-trains: it is just one fine piece of equipment, and very safe, in my opinion. The drivers who operate them respect that they have more weight, and are bigger on the road.
The Chairman: I drive from Halifax to Ottawa and back on a regular basis, and that has been going on over a period of many years. I could write a book on what I have witnessed on the road. One of the things that is so obvious, and that I am very concerned about, is the attitudinal difference. I must say that I do not think it has anything to do with the number of hours the drivers are driving. It must depend on the company with whom they are trading. I would say that the drivers with Day and Ross, and you fellows, and Kingsway and the Cabana Group, you larger players in this field, your drivers are generally courteous. They are not racing one another down the highway. It is not uncommon to get caught in a race between two trucks -- and when I say that, I mean "caught." The only thing you can do in those circumstances is slow down, and let them get a quarter of a mile ahead of you. There is always the fear that one of them will make a mistake, and you will all be killed. The question of logbooks is very important, but there are other things that go with it.
Senator Bacon: I forgot to ask if there have been any legal challenges to your drug testing program.
Mr. Walker: Not as of yet, from my perspective.
Mr. Smith: However, we assume they are coming, unless you can help us.
Senator Roberge: I have question with respect to the weight carried in these trucks. For example, you were talking about 137,000 pounds, and in the United States, the regulation is 80,000 pounds. Of course, with that weight difference, and with our winters, compounds the effect and the damage to the roads in Canada and to the bridges, and what have you. However, if the Canadian weight level were to drop to the equivalent of the U.S. weight level, of course there would be a substantial economic impact on you carriers, but also a substantial reduction in costs of road repairs for the Canadian taxpayer. Do you have any comments you want to make on that?
Mr. Walker: One comment I will make comes right to mind. Your 80,000 pound vehicle has so much weight per tire on the pavement, but the thing I like about the B-trains, is that it has the same weight per tire on the road.
Senator Roberge: The same weight as in the United States, you mean?
Mr. Walker: Right.
Senator Roberge: Because of the stretch?
Mr. Walker: Yes, because of the stretch, and the equal distribution that that equipment is able to provide. The tri-axle piece of equipment that is in common use on our highways is the one that is causing the problem, because it is about a thousand pounds of tire more. That is, in rough numbers.
Senator Roberge: That is interesting. Already there has been a number of discussions between the federal and provincial Ministers of Transport in relation to standardization. However, those talks have not yet gone far enough; there are still many areas that lack uniformity. I do not know why it is taking so long, but should the federal government, in your view, impose uniformity in standards?
Mr. Walker: I have sat in on some of those very discussions, and I believe that there are some attitudes assumed, and that some of the participants do not want to give or take, or arrive at a consensus. In other words, someone needs to be a winner coming out of those meetings. If I were to comment on that situation, certainly there would be a definite benefit in having an individual appointed thereto as a mediator to cause some form of agreement to be arrived at before the participants left the room.
Senator Roberge: What you are saying, basically, is that it is a political situation?
Mr. Walker: Exactly, next province.
Senator Roberge: Another thing that you talked about is enforcement, and you said that the penalization on enforcement is not adequate, or is not standardized; that there is no uniformity. Is there not a law which stipulates what the enforcements are, and should that not be followed?
Mr. Walker: Again, each province has basically set differing formulas across Canada. Then there are the U.S. regulations, and drug and alcohol testing is part of the DOT inspection routine down there, as well as your accidents per million miles based on a standard. I just went through a recent DOT audit in New Brunswick, and I am quite pleased to say that our results were satisfactory on that audit. However, two items which are not considered during that inspection or audit are drugs and alcohol testing, and accidents per million miles.
When you have an audit or inspection under the auspices of the U.S. inspectors and regulations, they go through similar checks: your driver hiring procedures and files, your maintenance procedures and files, your discipline procedures as far as dealing with issues with drivers, and your records on maintenance on all your vehicles, and then your flying record is similar to your drivers' licences. You use demerit points on your driver's licence for various items, I believe it is 157 items, plus that which a carrier loses based on the inspection or fine that is levied against the driver or the equipment. In addition, it renews itself every two years. January 1996 will drop off in January 1998. That is a serious concern with many carriers right now, in that it is mounting up.
In our case, one that is disturbing to me is that we have had overweight fines levied on us from that inspection, and we have since adjusted that. But once they get that on your record -- and it must be 2,000 kilograms or more, which means that we were substantially overweight on an axle or a gross. Believe me, that has been fixed. That is the source of the demerit points which causes your safety record to be satisfactory or not satisfactory. Speeding tickets, falsified logbook, et cetera -- they are at different point levels. However, there is a difference between the Ontario method and that of New Brunswick as far as how that calculation is done.
Mr. Smith: The other concern we have in relation to that type of inspection is that we are not sure whether or not any consequences are associated with non-compliance for the carriers who do not comply with that inspection. We do not have a problem with the inspections, and so on and so forth, but we feel there should be a level playing field. If we are doing our job, that is great, but if somebody else is not doing their job, or we are not, then there should be consequences associated with that.
Senator Roberge: Probably the most important element is that uniformity within the country, which affects all of the components of safety and of enforcement, and all those other things.
Mr. Smith: Within the country, and within jurisdictions.
Mr. Walker: There are consequences if a U.S. DOT inspector comes up and does an audit on you, believe me.
Senator Roberge: I wish to go back just very briefly on the log. Is there not some mechanized system which exists whereby the individual does not need to write down what happens in a log over the day, and so forth, something like the black box in an airline? Is there anything of that nature that exists or is used in the trucking industry in the world?
Mr. Walker: The answer is yes, simply because of the lack of ability for every vehicle to have that transporter, if you will, to record that information.
Senator Roberge: What do you mean "lack of ability"? Do you mean because they cannot afford it?
Mr. Walker: They cannot afford it, and how does the reader of such data determine whether the driver was in the truck, or not in the truck, or whether the truck was sitting idling, or even which driver was in the truck. The accuracy of the collection of that data has not been acceptable according to the standards of DOT at this point.
Every truck that we have on the highway has one of a variety of two different styles of recorder installed therein. Both styles of recorder record the same things, but with one type of recorder the truck must be available to manually dump the information from it into the recorder. Some of the long-haul trucks have installed in them a sensor truck system that, once every 24 hours, dumps into it the idle time, the over-the-road speed, et cetera, through the satellite system, where we monitor from that side.
Senator Roberge: So you have a double check?
Mr. Walker: Exactly.
Senator Roberge: Can you also physically impose a limit on speed in your trucks?
Mr. Walker: Yes. The newer vehicles all have electronic engines. Basically, you can change the horsepower and/or the overall road speed with a hand-held computer attached to the truck. We do road-speed govern ours at 60 miles an hour.
Senator Roberge: All of your trucks, for example, are at maximum 60 miles an hour?
Mr. Walker: The company-owned trucks, yes. The owner-operators, we monitor them from sensor tracks, and we admonish them if they operate faster than 65 miles an hour. We do not condone faster than that.
Senator Roberge: For example, once the federal government gets into bed with the provinces on this, eventually they will impose a maximum speed limit on all the trucks in the country.
Mr. Walker: Which could be inspected by just attaching a reader to the vehicle. In that way, you can tell what it has been doing.
Senator Adams: Besides Irving Oil, do you represent other oil companies? Do you conduct the same mandatory testing of employees? I am talking about companies such as Petro-Can, for instance. I do not know how those things work. I do not know if you have your own employees do this testing, or whether you hire someone else to do it.
Mr. Smith: We represent J.D. Irving, which is the non-oil side of the business, if you will. I cannot answer for Irving Oil or any of the other oil companies. I really do not know. In this respect, we could not find a many examples to follow, so I think we are sort of leading the pack with respect to the alcohol and drug testing.
Senator Adams: Irving Oil has the majority of its gas stations on the east coast. How far do you go into the United States? Do you go down only as far as Boston or New York, or way down to Texas?
Mr. Smith: I really do not know what Irving Oil's market area is. It will certainly be in the northeast of the U.S., and in the maritime provinces of Canada, but I cannot tell you what the extent of their market area is. I do not know.
We do not represent Irving Oil. Other than buying their products, we really do not have an association with Irving Oil on the J.D. Irving side of the business.
Senator Adams: We heard about some of the trucking companies levying penalties if their drivers to not deliver on time. Do you have a similar system?
Mr. Smith: On-time delivery is a critical issue to many of our customers. Generally, you have somewhere around a 15-minute window to arrive at the dock where you must unload or load. If you are outside that window, the truck can sit for 24, 36 hours waiting for the next available dock space. The key things that the trucking companies must know when they assign a load to a driver is, first, how far away it is, then how many hours that driver has available to him, and so on, and so forth, in order to make sure that he can get to destination, and do it legally and on time. The consequences of not being on time are significant nowadays.
Mr. Walker: Perhaps I could just add something to that. The big shippers, the major ones -- and I just came back from consulting one earlier on this week -- although they have timed windows for deliveries, there is a great deal of discussion to ensure that there are ample hours to perform the line haul portion of the trip, in order to arrive on time. They are not tied to a schedule that says that you leave on a ten-hour run, and you only have nine hours to complete it. You probably have a ten-hour run with twelve hours to do it, and still be on time. A lot of attention is paid to that aspect.
Senator Adams: Could you make the excuse that you were delayed by a snowstorm, or something like? Would the suppliers accept that?
Mr. Smith: Generally, if you let the receiver know ahead of time so that you do not keep them waiting, and just do not show up, it is not a problem. However, if you are stuck in traffic or whatever, and you know that you will be late, often you know you will be late 24 hours before your due arrival time. Generally speaking, if we know about a delay, and we tell the customer well ahead, that is not a problem. They understand it, they have time to modify their production plans or whatever, and they work with us. Basically, it is a partnership: both parties, the customer and the trucking company, must work together to make it happen and do it right.
Senator Adams: I drive on the highways too, and a lot of trucks do not go any more than 60 miles an hour. Maybe the speed of their vehicles could be controlled by the government. If the government made a regulation of that type, we would cut down on highway accidents. On the other hand, some big trucks travel at 70 or 80 miles an hour when the speed limit is marked as 60 miles an hour.
Mr. Smith: All those regulations are there today, and it comes back to the question of enforcing them. We can have all the regulations in the world, but if they are not enforced, what do they mean? That is why we have taken the approach we have taken. We firmly believe that, with the exception of a couple of areas, there is sufficient regulation now in existence to do the job, and the question comes down to enforcing that regulation.
Many of the accidents that occur, often the cause of them comes down to somebody not doing something that they, by regulation, should have been doing. Ninety-five per cent of the drivers and owner-operators are good people, and work according to the rules, and so on. However, it is the exception to that rule who causes most of the problems. Generally speaking, I guess that is what most regulation is aimed at; looking after the exception rather than the rule. However, if the exceptions are ignored, then things will happen that we do not wish to happen.
Senator Adams: We met with some people from Montreal who were representing tire companies. Tires are sometimes directly related to accidents. Tires are important on the highway, as are wheels and bearings, since bearings can overheat. Do your trucking companies have problems with tires?
Mr. Smith: Basically, you get what you pay for. You can go out and buy something that is inexpensive and it will not be quite as good as the quality product. We put good products on our equipment, and we have good preventive maintenance programs. Essentially, we take a proactive approach to maintenance. We eliminate the problem if at all possible before it happens.
To answer your question, no, we do not have any significant problems of the nature that have been, should we say, rather highly publicized in recent months.
The Chairman: I am very pleased to hear you say that, and will be pleased to read it. With respect to carrier responsibility, and the assumption that a truck driver's licence means that he or she is qualified, we have your very forceful statement that you believe this assumption is incorrect, and that carriers should be required to provide new hires with adequate training to perform the job safely and efficiently. From the training side, yes, I see that.
However, what about qualification? Whose responsibility should it be to determine what the qualification should be? If somebody hires an airline pilot, the airlines have standards and they have operation manuals, but his qualifications are determined by a third party, and generally you accept that third party's advice on whether or not this man or woman is qualified to fly, and can fly. I know that the whole question is coloured and complicated by the fact that there are various provincial jurisdictions, but should there be a third party authority to whom the trucking companies in this country could turn -- and indeed, I would assume that even the owner-operator himself must qualify as well. Is there a third party that would be acceptable to all of the players and, if so, who might that third party be?
Mr. Walker: What we have done in our company is to take some senior drivers to the training schools, and for seven full days they learn how to be an evaluator, in the cab with a particular driver. We take anywhere from one to eight weeks on most new entrants, and they travel with this individual. We get written reports back before we allow that individual to take a vehicle of ours and run solo. Some do not return from that process. Most enjoy the tips of the road, if you will, and the load configurations that they face, and the paperwork and border crossings that they face, and gaining that experience, before they are allowed to go solo. Now whether that should be the responsibility of the carriers or a third party, we certainly must have confidence in whichever it is, and we are quite comfortable with what we are turning out right now with the help of the existing drivers.
The Chairman: I am addressing, in part, the difficulty with respect to enforcement, and the uniformity of enforcement. I think generally we accept that the larger carriers are quite capable of doing this themselves. They do it in their own best interests, and that is the motivation: good business means good profits, I suspect. However, what happens with respect to the individual, the independent owner-operator? Who checks on him, and who trains him? Because he, too, is barrelling down that highway, passing you fellows and cutting us off. As a matter of fact, as much as I love flying in the aisle seat, and I love driving on the road, sometimes it seems as though the road is a menace. Sometimes you are a nervous wreck; you get out of the car and you are still shaking. When you see such things as tires coming off, or you see a truck tire engulf a Volkswagen, it really shakes you up. I witnessed just such an incident, and how that lady kept her car on the road, I will never know. The tire was from an enormous truck; it was a very large tire, and the bottom ended up underneath the car and the top of it was on the hood. She swerved between two trucks which, although I had no way of knowing, I had no doubt in my mind that they were racing, and she got caught. A truck tire imploded <#0107> exploded <#0107> whatever it is that happens. They call them economical tires, but they were not that on the driver, or on the power.
What do you do about the independent operator? How do we get at enforcement other than by way of a third party? If you stopped a truck, and he did not have a certificate saying, "I have taken 19 days of training and I am qualified. Here is my operating certificate and here is my chauffeur's licence, and I have all of the paperwork that says that I am a trained, safe operator of a truck" what do you do? Short of issuing such a certificate, how do we manage it?
Mr. Smith: Again, I do not have the magic answer. However, let me make a comment. I do not think it is correct to say that all independents are not good at what they do.
The Chairman: Oh, I did not say that.
Mr. Smith: Very well. I got the impression that you were using a broad brush in that respect, and I think that would be wrong. In any business, in any endeavour, be it trucking or anything else, some people are better at what they do than others; some people are worse. With some of the latter, it is on purpose, and with others, it is because they do not know any better. I think there are two parts to it. Somehow, there must be a certain level of mandatory training in order to become a professional truck driver, or whatever, and I cannot define where that should be carried out, but there must be something.
The other part of it comes back to enforcement. There should be inspection people out on the road constantly, and I assume that, right across the country, there are provincial inspection people who go out and do vehicle checks, who check driver's logs, so on and so forth. I am again guessing that certain operators, if they are not compliant, probably should be checked more frequently; perhaps the better operators with less frequency, so that at least the resources that we do have for checking are concentrated where the problem areas are. Ultimately, somebody must be taken off the road if they are not able to do the job safely. To say that that is an extreme reaction, and that we are taking somebody's livelihood away from them, yes it is, but at the same time, everybody screams when a truck driver takes somebody's life away from them, and it taints the whole industry. I do not know of any other way to handle such a situation, other than getting tough with those who are bending the rules.
The Chairman: Speaking of broad brushes, between Rivière-du-Loup and Ottawa at 100 kilometres an hour, there is not a truck on the road that will not pass you. If you are holding him up and he is in a hurry, he will overtake you. I can tell you that from firsthand experience, over a long period of years. Having said that, I am frustrated with the dilemma. As an operator, it must frustrate you gentlemen even more.
Moving to a topic of lesser importance about which I like to ask truck drivers: apart from the road conditions -- potholes, bad shoulders, and all the things that occur -- passing a truck in wet weather on slushy highways is very dangerous. Recently, driving down to Washington under bad highway conditions -- rainy, slushy roads -- we were experiencing this constant spray. All of a sudden there was a calm when we were passing a specific truck, and there was no spray. Nothing was happening. We passed that truck and it started all over again. That truck had an ad. printed on it promoting a casket company, which I thought original. We saw that truck two or three times within the space of an hour, and we noticed that it had splash guards all the way along the side, presumably on both sides, although we did not see the right-hand side of the truck. Can you talk about the advantages or disadvantages that splash guards might have for safer operation on the highways?
Mr. Walker: We have some vehicles, not on long haul but in the city, equipped with those. That is a piece of fibre that looks like a broom hanging down the side of the trailer, but it is very expensive. I am guessing right now, but what quickly comes to my mind is about $500 a set for one trailer. I certainly have no objection to it, if we can get everybody on the same playing field to support that.
The Chairman: The $500 investment will last a little while. It will not wear out in a season. They are made of durable materials.
Mr. Walker: That is right. You probably have the life of your vehicle, which is anywhere from seven to ten years.
The Chairman: Does this extend to cover the control, the drivewheels?
Mr. Walker: It could be put on the whole thing, if you wanted it.
The Chairman: Are you equipping 5 per cent of your fleet?
Mr. Walker: No. We are equipping 1 per cent, maybe.
The Chairman: Do you have any objectives to increase that?
Mr. Walker: No. We are going to air rad. equipment, to LED lighting, to ABS brakes.
The Chairman: What is LED lighting?
Mr. Walker: We have adapted LED lighting on our chip fleet. Those are light emitting diodes that are guaranteed against burn-out for ten years. That system draws less amperage from the alternator of the vehicle. It is quite a lot brighter, and can be seen from a long way away, compared to existing lighting in storms, fog, et cetera. It is similar to the brake lights in cars that are much brighter than tail lights. It is a similar light to directional and brake lights that we have installed on quite a number of our trailers right now.
Senator Adams: We heard that many of the drivers did not have experience in driving a truck. They were former policemen, or whatever, and had been hired by a company. You have drug testing for your drivers, but there are many drivers who do not know anything about black ice, for instance. I do not know how often you have accidents with black ice. Do you train your drivers about the dangers of driving on the highway?
Mr. Walker: Part of our driver training is where the trainees go with an experienced driver. That is one criteria that we try to instill upon them as to how to handle that very issue, along with all of the other items that they get involved in. It is not a specific item.
Senator Adams: Do you have any age limit when the drivers must retire?
Mr. Walker: Not for retiring. The age of 22 is the minimum age for hiring. I have a husband and wife who are operating in our system who have been there for approximately 35 years.
The Chairman: I would like to thank you for your frankness and your openness. You have been of assistance to us in identifying problems. Perhaps later this fall, when we are considering solutions, we may come back and fly them across your bow and ask you for your comments and observations at that time. In the meantime, you have done the committee a service.
Mr. Smith: We appreciate the time afforded us. We will be pleased to help in any way we can.
The Chairman: I would like to welcome Mr. David McCutcheon, who is the Flight Safety Manager for Canadian Helicopters Limited.
Mr. David McCutcheon, Manager of Flight Safety, Canadian Helicopters Eastern: Honourable senators, I want to give you a history of Canadian Helicopters: where we have come from, where we are now, and where we would like to go.
I should start off with our company philosophy. Safety is first and foremost in everything that we do. As a company, we realize that we ride on our reputation. If you are a safe operator, your customers will stay with you.
Canadian Helicopters has been operating for 50 years. We started in 1947 with Okanagan Helicopters in Vancouver, British Columbia. Mr. Greg Dobin had a company called Sealand Helicopters, and in 1986 he bought Toronto Helicopters. With that company, he then bought Okanagan Helicopters, which was a bigger company. Today, we operate over 220 helicopters: 180 are in Canada, another 20 are throughout Asia and another 20 are in Britain. We have a subsidiary called British International Helicopters.
Canadian Helicopters is also in the business of repair and overhaul of helicopters and aircraft components. We have two overhaul components, one of which is ACRO Aerospace out of Vancouver, British Columbia. It does basic helicopter engine repair, helicopter transmissions, any component that is on a helicopter. In fact, they have a body shop where they take a helicopter that has been in an accident and rebuild it like new. Not only do we do our own aircraft, it is a contract service, and they have components shipped to them from all over the world. Many Americans will use a Canadian overhaul facility due to the high standards that we have in Canada.
Another interesting division is Atlantic Turbines Inc. out of Summerside, PEI. That company was started about three or four years ago on the old air base. It overhauls Pratt & Whitney 100 series engines. The Pratt & Whitney 100 series engines are the engines that are going in the modern commuters like the Dash 8s, all these different types of commuter aircraft, the 50 to 80 seater type of aircraft. They have done remarkably well. That company is a major success story.
I will talk mostly about our operational side. British International Helicopters and Canadian Helicopters International are distinct from Canadian Helicopters Western and Eastern, which are the domestic operations of Canadian Helicopters. British International basically supports offshore oil exploration on the North Sea in Britain, and also runs a commuter service down the south islands in Great Britain.
Canadian Helicopters International is the component that deals with our international customers. They are working mostly in Asia and Africa on offshore oil support. A couple of years ago, they had some major contracts with the UN, supporting peacekeeping operations in Somalia for the most part. These two operations are different because this one, Canadian Helicopters International, is more like a scheduled carrier. It is more like flying with Air Canada. The pilot comes in in the morning. He knows that he will leave this airport, fly out to this oil rig, drop off his customers, pick up some people there, and bring them back into shore. There are two pilots, and it is more controlled and regulated.
Canadian Helicopters Eastern and Canadian Helicopters Western, on the other hand, are the Canadian domestic operations. The environment these guys are working in is much tougher. You are out in the bush or up in the Arctic, remote locations for the most part. Eighty per cent of these aircraft are single pilot aircraft and usually single engine. From a safety point of view, this is our big worry; this is the part we worry about the most. Internally, we realize that if we are going to have an accident, it will be in this portion of the business. It will be the single pilot helicopter. He will hit his tail on something in a tight, confined area in the bush. It is tougher flying because you are by yourself, you are making your own rules, you are the boss.
I have a chart from our Annual Report for 1996 which explains where our revenues have come from.
The next chart shows the aircraft types that we have, how many aircraft we use. I have also handed out a brochure called "Fleet Facts". That will give you background information on what each aircraft can do. It shows the number of passengers each aircraft carries, how many hours it can stay in the air, and how many pounds of cargo it can carry.
I have worked with Canadian Helicopters for 20 years. When I started in 1977, the industry was much less regulated. The people from Irving Trucking were talking about duty time. At that time, there were basically no duty limits. If a pilot was 30 years old, he was a really old guy, and you knew that he would be retiring very shortly. There was less acceptance of rules, possibly because we were much younger and a lot more foolish. Also, at that time, Transport Canada's inspectors tended to be ex-military men. That was their background, and they did not understand the civilian market.
What has happened today is that there is a broader spectrum of pilots. We have pilots who are 65 years old and are retiring out of the industry after 30 years accident free. We also have young guys who are 22 years old and just out of college starting in the industry today. Companies have realized that the rules are there to help guide an industry and, therefore, enhance safety.
Transport Canada has changed. Most of the air carrier inspectors and regulators are people who have been out in the industry. They know the environment in which we are working. They know our problems. Therefore, they assist you in getting things done. As a general overview, from a pilot's point of view, the Canadian rules are more restrictive than you would find with the FAA in the United States. They are not quite as restrictive as those of Britain or other European countries. Canada is the compromise between the British or the European standards and the American standards.
Canadian Helicopters Eastern operates under Canadian rules, but when they go to an Asian country they will operate by that country's rules. Officials from some of these countries come to Canada and visit Transport Canada, looking for guidance on what they should set up as regulations. Many of them will follow the rules of a European country.
In the last year, Canada has changed the air regs. What used to be the Air Regulations and Air Navigation Orders are now Canadian Air Regulations or CARs. They came into effect in October of 1996. These harmonize the rules between Europe the United States. The United States is starting to harmonize their rules with what is going on in the rest of the world, although they still remain very independent.
I would like to talk a bit about accidents. I have a couple of graphs, the first one being the helicopter flight hours in Canada. I would like to point out that the numbers for 1996 are estimates. The other numbers for 1991 to 1995 are from the Transportation Board. They put out a brochure on the number of accidents and the hours of operation, that sort of thing. Using 1995 as an example, because that is the last full year for which they have numbers, approximately 500,000 hours were flown. Canadian Helicopters flew around 125,000 hours, which is about 80 per cent of the flying in Canada, or by Canadian air carriers.
I have a graph on accidents in Canada, the number of accidents we had and the number of accidents sustained by all of the Canadian operators together. Generally speaking, 17 per cent of the accidents in Canada involves one of our aircraft.
An accident can be a major catastrophe where there are fatalities involved, or it could be that the helicopter lands too close to the building and the main rotor blade clips the hangar door. That is an accident as well. In that case there is very little damage done; perhaps one blade has to be changed, but there are no injuries. That is the variance.
I have produced a pie chart showing how many hours Canadian Helicopters flies and the percentage of accidents. The normal standard for measuring accidents is accidents per 100,000 flight hours. The gentleman before me from Irving Trucking was talking about accidents per million miles. The general standard for aviation is accidents per 100,000 flight hours. If we use the figure from 1995, at that point it looks like Canadian Helicopters had 8.2 accidents per 100,000 flight hours. The country as a whole had about 15.5 accidents per 100,000 flight hours. That was a good year for us. We were about half of the industry standard.
How does that compare to the American figures? Canada's rate per 100,000 is higher than in the States mostly because of the environment in which we work. Most of our flying is done in remote areas. It is not landing at the heliport in downtown Halifax and going out to the airport. Most of the flying in the States tends to be that type, such as executive transport, or around major cities where there is not such a big problem. They have fewer remote areas than we do.
Accidents are like a chain. As a company, we are trying to interdict on this chain. We are trying to break that link. If you break the link, you stop the accidents. The gentleman from the railway said that 90 per cent of their accidents were human error accidents. The same could be said for the helicopter industry. It is not a component failing on the aircraft; it is the pilot, which is a human error problem. It is not a skills problem.
Most of the accidents are not caused by the pilot who just got his licence, and the ink on it is still wet. It is the senior guys who have been flying for 5,000 hours and who have been in the industry for 10 to 15 years. It is just SLOJ, or sudden loss of judgement. You could have a guy who has been perfect for years, and all of a sudden he will do something foolish. What brings that on? A lot of it is a desire to please. Everybody wants to be the nice guy, help out. They'll say, "I will land in that hole in the bush. It's going to be tight but I think I can get in there." You go in once and you pull the customer out and you say, "You guys should trim these trees." You come back to pick him up later on and they have not trimmed the trees. You say, "I will go in anyway." That is when you have a blade strike, or a tail rotor strike; the helicopter is damaged, and you have become a statistic.
There is also perceived pressure. You were talking earlier about the trucker and the on-time delivery. A pilot will be sitting in his tent on the tundra and all of a sudden it starts to snow and he cannot see the next tent, but he knows he has some drillers who are ten miles out on their drill. He says, "I have to go out and get those guys." We are trying to tell our pilots that they do not have to get them. We are saying: Stay in your tent; the weather is going to pick up; those guys that are out there have their survival packs with them; they have extra lunches and things like that; they are okay. But the old attitude was, "I have to go out and get them. I have to be the rescue pilot." Our company policy is to support the pilot in his decision not to go. Like the guys in the trucking company, if we find a guy who is breaking the rules on a consistent basis, we take disciplinary action. Years ago it was ignored as a problem.
We recognize that pilots sometimes do not make the right decision.We have initiated a program where, in the next two years, we will put all of our pilots through a course called Pilot Decision-Making, which is geared towards the pilot who is working by himself. On our multi-crewed aircraft, the two-pilot aircraft, we are putting them through crew resource management. Crew resource management or CRM is a human relations type of course where we want our pilots to be open to the suggestion of a safer way to do things, and to use all the resources they have in the aircraft and in the cockpit to make the right decision.
We also have a program to get more information out to our pilots on accidents that have happened; what caused them, and how can we prevent them from happening in the future. You do find that pilots are making the same mistakes over and over. One pilot said, "I did not hear that Bill had that type of accident." We need to let the pilot know that he has the support of management, right from the Chief Executive Officer, the Chairman, on down to the local base manager.
One of your topics for discussion was deregulation and its effect on us. The helicopter industry has been dealing with deregulation in one form or another for the last ten or more years. We are finding that more and more operators are getting started. The smaller operator just starting out has maybe one machine. It is his machine, and perhaps he has an engineer who looks after that aircraft. When times are good, there is no problem. Sometimes they can feel pressured that they have to make their mortgage payment or whatever, so that can be a problem. Every company, Canadian Helicopters included, has started out as a single helicopter operation at one point or another.
Everyone must operate by the same rules. In Canada, air transportation is a federally-regulated operation. You do not get too much provincial interference, so the rules are the same throughout. There is a consistency within Transport Canada for the application of rules. You also have the same rule in Vancouver as you do in Halifax, and Transport Canada are consistent on how they apply those rules.
Safety is monitored by Transport Canada with periodic audits. Our company, being the largest company in Canada and the third largest in the world at this moment, receives an audit from Transport Canada every two years. Air carrier inspectors and maintenance inspectors do not visit every base or every machine, but they were out to our operation in Somalia two years ago, and into Thailand. They have also been to our more remote bases like Voisey's Bay, Goose Bay and Vancouver Island.
On a regular basis, through our own written procedures and regulations, the company does a self-audit. We also send quality assurance out to do an audit on each base for maintenance concerns.
Senator Roberge: You said that the laws in the United States and internationally are more stringent than in Canada?
Mr. McCutcheon: In the United States, they are much looser. Canada's laws are much tougher than those in the United States.
Senator Roberge: And internationally?
Mr. McCutcheon: They are a bit tougher. Some of the general rules, such as for day-to-day flying in Europe, you need a mile of visibility. In Canada, you used to by able to fly with half a mile. They just moved it up to a mile. In the States, there is no limit. For night flying in Canada, you must establish a minimum safe altitude, which is 1,000 feet above the highest obstacle. That is the same in Europe. In the United States, there is no limit. You can pick your own altitude.
Senator Roberge: Nav Canada has been recently created. Do you think that may have an impact on safety?
Mr. McCutcheon: It could. You get into trouble when people try to be too cheap. Has there been a mechanism developed yet where Nav Canada will say, "You will pay to use this segment of the airway"? I do not think so, but that is what they will get into. Instead of flying IFR and using the airway system, which Nav Canada will operate, operators may say, "We will scoot along on VFR". That is where you will get more airplanes down in the area where helicopters are usually working. That might be a problem.
Senator Roberge: But that can be regulated?
Mr. McCutcheon: Yes, but it would be hard to regulate. A lot of it would occur in remote areas where the aircraft is not, or cannot be, seen by radar, and things like that.
Senator Roberge: You said that most of the accidents are caused because there is lack of discipline. I would imagine that if you have proper training and proper penalties which are stringent enough, you could counteract some of those things. I am a little surprised at that comment.
Mr. McCutcheon: People do not think that they will have an accident.
Senator Roberge: But if you have some stringent regulations within the organization, you can counteract these things. People know they will lose their licence or their job.
Mr. McCutcheon: We have done that. If you have a major accident, you will probably lose your job. People know that. But the attitude is "It will not happen to me". It is a psychological thing. We are trying to get them to think that it can happen to them, and therefore do not take the risk. There are enough risks as it is. They do not need extra ones.
Senator Roberge: If I go to your organization and I want to see the records of repairs, maintenance and upkeep, is that all computerized? Do you know exactly what has been done on each of your aircraft?
Mr. McCutcheon: Yes. Some of the helicopters we have are more than 20 years old. Every component on it has a finite life. They are overhauled at a certain period. A main rotor blade is good for 4,000 hours; part of an engineer is good for 2,000 hours. Then you take that part and overhaul it. We maintain computerized records, plus there is an actual card that goes with that component whenever it is shipped out for overhaul. It is all well monitored.
Senator Bacon: I was surprised to hear that the major cause of helicopter accidents is pilot error. What about weather or mechanical?
Mr. McCutcheon: Pilot error is a big section which encompasses weather. The pilot is the one who makes the decision whether or not to go.
Senator Bacon: Do you have any rules?
Mr. McCutcheon: There are lots of rules. There are rules that say how many miles of visibility you need to have. Sometimes people will just ignore the rule, because they think the customer wants them to go. It is a thought process, and we are trying to emphasize to our pilots to stop and think; they do not have to do it.
Senator Bacon: What about mechanical fault?
Mr. McCutcheon: Mechanical fault causes maybe 10 per cent of our accidents. That would be on the high side. In the last year, I cannot think of one accident that was caused by mechanical problems, and I think we had ten accidents.
Senator Bacon: Is there any competition in the helicopter industry that would force carriers to cut back on maintenance or repairs in order to cut the costs?
Mr. McCutcheon: There is more deregulation, so you get more competitors. Most companies realize that they must maintain their aircraft to a standard. Transport Canada will come in and look at your books to make sure that they are maintained.
Senator Bacon: Is there a possibility of cutting costs in maintenance?
Mr. McCutcheon: There is a possibility, yes.
Senator Bacon: Because of competition?
Mr. McCutcheon: People may have done that in the past.
Senator Bacon: Is there strong competition among the helicopter companies?
Mr. McCutcheon: It is a very competitive business. It varies from year to year, depending on the amount of work out there. The last three years have been very good.
Senator Bacon: Do you stress to your pilots the importance of safety measures? I suppose you have special training on that.
Mr. McCutcheon: Yes. Each year every pilot has a minimum of one hour of training on each type of aircraft that he flies. Then he gets an hour-long check ride with a check pilot to make sure that the training pilot has done his job. That is a minimum. If somebody needs more, or if we are about to do a specialized job, then the pilot gets extra training to get him up to standard to do the work.
Customers expect the pilots to be well trained. They know what a pilot should be able to do. If you send someone who cannot do the job, they soon let you know.
Senator Bacon: If I ever travel by helicopter, will that be safe?
Mr. McCutcheon: Oh yes.
The Chairman: The operations at Voisey's Bay amounts to quite a challenge, perhaps the largest challenge, that any lifting company has had over the years. Could you tell us about any innovative measures you are putting in place or considering with respect to safety? Just talk to us generally about it.
Mr. McCutcheon: Transport Canada helped us out at Voisey's Bay. We were working there, and another five or six operators had an additional 20 helicopters out there. There were approximately 50 machines in a very small area. Air traffic control became a problem, and Transport Canada helped out by setting up a separate frequency to use in different areas. We established routes. If you go from here to here, you would follow a particular route. We made sure that all the pilots followed the routes in order to avoid mid-air collisions. With that number of aircraft operating in a small area, it was a valid concern.
Because of the number of people who are going through there, we set up a standard safety briefing scheme. As soon as someone came on site, on to the customer's property, we would take them through and give them a briefing for safety around the helicopters. We also used fencing to control people from walking into the helicopter operating areas. We also used many twin-engine aircraft there because the terrain is so rough. It is a brutal area.
The Chairman: You have encountered no surprises, then, from the safety aspect of the operation?
Mr. McCutcheon: No. We were surprised by the number of aircraft operating in the area.
The Chairman: Did you have a portable tower, or was it plane to plane?
Mr. McCutcheon: It was all plane to plane. In the town of Nain, there was a ground control there, more or less. There was someone you could talk to at Nain airport, an advisory system.
The Chairman: Is it all VFR or is it mixed?
Mr. McCutcheon: It was mostly VFR, with a bit of IFR. The airplanes that are shuttling people in from Goose Bay would be on IFR flights.
The Chairman: No sightseeing?
Mr. McCutcheon: No sightseeing.
The Chairman: What equipment are you using up there?
Mr. McCutcheon: We have Bell 212s. That is a medium twin, a 12-passenger helicopter.
The Chairman: Does it have any or limited de-icing?
Mr. McCutcheon: No de-icing. None of the aircraft up there have de-icing. If there is freezing drizzle, it is a no-fly day. We are also using Eurocopter Astars 350. It is a six-passenger aircraft. We are also using Twin Stars, which is the twin-engine model of the Astars. We are using a lot of Bell JetRangers and LongRangers as well.
The Chairman: With respect to your offshore operations, you suggested that when you are in Indonesia, you do as the Indonesians require. Do you maintain your Canadian operational standards with respect to maintenance and safety?
Mr. McCutcheon: For flight standards, maintenance standards and safety, if the Canadian rule is higher, we use it. If the local rule is higher, we fly to that standard. In Thailand, they basically follow the Canadian regulations. They deal with Transport Canada on rules and procedures.
In some countries where we go, we are the first operator there, so they use the Canadian rules as the rules to work by. Those are the first standards that they have had, of any description.
The Chairman: The Canadian standards would become the standard?
Mr. McCutcheon: Many of our customers are American or British companies, and they will pick a Canadian company, whether it is Canadian Helicopters or some of our competitors, just because of the Canadian rules and the way we operate as helicopter operators.
The Chairman: The crews of your aircraft operating in Britain, are they generally British?
Mr. McCutcheon: British International is a separate company, and they are all British pilots. As a Canadian, it is hard to get in there and work in Britain; it is almost impossible.
The Chairman: Does the same hold true in Indonesia?
Mr. McCutcheon: No. They recognize a Canadian licence and they let us work there. As a country develops and they get their own aviation industry, they tend to tell us to go back to Canada. India is an example of that. In the mid-seventies, India was a big operation for Okanagan Helicopters. Then they decided that they would take over, and they used some of their own army helicopters and replaced us.
The Chairman: We are going to make suggestions with respect to an Aeronautics Act to replace the 70- or 80-year-old apparition that we have. Could you talk to us for a minute or two about things that you might like to see in a new Aeronautics Act, such as the regulatory process, Canadian ownership, licensing, or the hours of operation?
Mr. McCutcheon: We operate internationally. By the same token, we worry about American operators coming up and working in Canada. We had some concerns with free trade. As long as they are working by Canadian standards and maintaining their aircraft to Canadian standards, then the competition is equal. A level playing field is important. If everyone works by the same rules, it makes it safer because then you have good, steady competition and nobody has to cut corners because everyone is operating basically the same. Then it becomes the customer's choice as to the level of service they require.
The Chairman: Are corners being cut in your industry, Mr. McCutcheon?
Mr. McCutcheon: Generally there is a possibility, yes.
The Chairman: Where corners are being cut, would you have reason to believe that this might impair safety?
Mr. McCutcheon: Short term, probably not, but if you get into the habit of cutting a corner to get something done, then there is something wrong with the process and eventually that will catch up with you.
The Chairman: I am talking about buying, for example, a stolen spark plug that has not been tagged.
Mr. McCutcheon: You see very little of that in Canada. Maybe I have been sheltered a bit because at Canadian Helicopters we are very careful where we buy our parts. If we buy something from a company in the United States, we will go down and audit that company to see their standard of overhaul.
In the United States, there are a lot of ex-military parts floating abut. They may not meet the same standard as the manufacturer, Bell Helicopters, in Montreal specifies. That is a problem in the industry, especially in the States and the Far Eastern countries. In Canada, most companies are very careful about what they buy because you could end up with a part on your aircraft and Bell Helicopter will say, "That aircraft is grounded until that part is replaced." That happens.
The Chairman: How would you get your hands on a part like that? Would it be through suppliers?
Mr. McCutcheon: They drift into the system.
The Chairman: Like a flu bug?
Mr. McCutcheon: Yes, it is like a flu bug. The major air carriers, such as Air Canada and CP, need to be very careful where they get their parts. I have heard of operators buying parts from some company in Florida where that company basically just washed it off, cleaned it up, and put a repaired tag on it. They are unscrupulous people, I guess.
The Chairman: If you look at something you can hold in your hand and it is part of a piece of machinery that you know is worth $50,000, and someone has one for sale for $2,000, you had better think twice?
Mr. McCutcheon: There is a great deal of temptation there. We are very careful where we get our parts. We audit. We have customers who come through and they audit us. Recently we had Broken Hills Proprietary Company from Australia. They came through and checked our maintenance records, our flight standard records. They even asked, "Where did you buy this part from?" You have to show where the part came from. You have to be able to trace it back to the original, new part from Bell Helicopter in Montreal. That is our standard. Most companies are like that, and they maintain that standard.
The Chairman: Even with Bell licencees you still need to be somewhat careful.
Mr. McCutcheon: Yes. Bell is careful also. They do audits on people who supply to them, and make sure that they are supplying spec. parts as well.
Senator Adams: I live in the Northwest Territories, and there are many helicopters flying around some of our communities. If you have a contract with the mining companies or oil companies, how do you set up your contract? Is it by flying hours or so many trips? How does it work?
Mr. McCutcheon: Usually it is by number of days, and by number of hours per day. In the summertime, if you were to look at a graph of the amount of flying done in Canada by helicopter companies, it is a reverse bell curve. It goes up in the summer -- May, June, July, August, September -- and then drops rapidly. November, December and into January is a very slow time. In the summertime, we tell our customers that they must pay for four hours at a minimum. In other words, we set a minimum number of hours that they must pay for each day. Most contracts are like that. The customer realizes that they must get all their work done, especially up north, in May, June and July. They do all their intense flying in the summer and then study the results all winter.
Senator Adams: Do you charge per hour or per day?
Mr. McCutcheon: It is a combination of by the hour plus how many days.
Senator Adams: I come from Rankin Inlet. Sometimes there are two or three helicopters up there in the summertime, working for a mining company. Do you have a rule that your pilots are allowed so many hours per week? It must be difficult to get another pilot to come in if you have to go down south and bring him back.
Mr. McCutcheon: It is all regulated. Each pilot is allowed a maximum of, say, ten hours per day. He can work for a 14-hour duty day. He is allowed to work 30 days, and then he needs to have three days off. There are more regulations being set up relating to duty day standards.
Senator Adams: What are the regulations for the payload in a helicopter? Do the pilots say, "I am behind in my hours. Because I did not fly yesterday due to fog, I can take an extra barrel for the day." Is that how it works, or does he have to go by the weight?
Mr. McCutcheon: He still has to go by the weight. The manufacturer sets the maximum gross weight of the aircraft, and the company has to maintain that standard. You have mentioned examples where pilots can say, "Because I did not work yesterday I will try and deliberately overload the aircraft." If we catch a pilot doing that, he is out of a job. It is cut and dried. He is not only damaging the aircraft at that moment, but that overweight operation will not catch up to us until half a year or a year later. Then you ask, "Why did this part fail?" "It was because Bill last summer was overgrossing the aircraft all the time." With the way we track maintenance, usually we can tell if somebody is abusing an aircraft, one way or another.
Senator Adams: We heard from some float pilots and helicopter pilots. They told us that there is a regulation stipulating no more than 10 or 12 hours a day of flying time. Do you think longer hours should be allowed because sometimes we have 24-hour daylight, and at other times we have bad weather? Do you agree with that? Should some pilots be able to add another three or four more hours every day in the summer?
Mr. McCutcheon: Transport Canada has set a standard, and if everybody adheres to the standard then that becomes the normal way that we operate, and I think it is better to leave it that way rather than make exceptions. We have had jobs in the past where -- and this is where I start contradicting myself -- there is very little flying, and you have a really long day, and the guy can sleep all day and then maybe do an hour of flying at 9:00 at night and then he goes back to bed and does not fly again until 7:00 the next day or something. Usually we try and push the fact that there is the rule, that is the regulation, they will not change it for you so stick with it, and if we must, we will put another pilot in there to double-crew the aircraft and make use of the longer days.
I just have one question, and the subject was raised earlier; it is with respect to drug and alcohol testing. It has become more of a problem with us in that we have aircraft operating for American companies, like a big American oil company, and they will say we want to do a drug test on Joe pilot, so it has become a problem for us.
Senator Bacon: What kind of problem; because people refuse to be tested?
Mr. McCutcheon: Nobody has refused yet.
Senator Bacon: Do you test?
Mr. McCutcheon: No, we do not, but our customers ask for it, though.
Senator Bacon: I would do that.
Mr. McCutcheon: It is something that the railway guys raised, and the road guys; it is a problem.
Senator Bacon: Why would the pilot refuse to be tested? We heard the trucking industry saying that they had programs and that they test their people, and the people accept it, 95 per cent.
Mr. McCutcheon: Most people will take it.
Senator Bacon: But you do not do it?
Mr. McCutcheon: Most people will do the test because it is not a problem.
Senator Bacon: Did you ever try to have a program? You are in charge of safety, are you not?
Mr. McCutcheon: Yes.
Senator Bacon: Would you have a program on drug testing and substance testing?
Mr. McCutcheon: No, we do not, because we understood that it is against the law, or against human rights.
Senator Bacon: It can be challenged, but you can have that to ensure safety to your passengers. If I ever fly in one of your helicopters, I will ask.
Mr. McCutcheon: Please do.
Senator Bacon: You had better have a program before that.
Senator Roberge: Is it perhaps something you should start looking into; do you start preparing a program not only for your customers but for others who do not ask?
Mr. McCutcheon: It is just that customers will ask to have a drug test, and generally you monitor what your people are doing.
Senator Roberge: If you are in charge of safety, you are in charge of getting things done better. Would that not be something that you should look into and make recommendations about to your bosses?
Mr. McCutcheon: To have random drug testing? Yes. It is an area of concern, yes.
Senator Bacon: Well, have you never thought about that?
Senator Roberge: Will you do something about it?
Mr. McCutcheon: No, we have never really thought about it.
Senator Bacon: You do not think about those things?
Mr. McCutcheon: Ninety-nine per cent of the people you run into, they do not have a problem with drugs or alcohol.
Senator Bacon: How do you know?
Mr. McCutcheon: It is a small community. There are probably 3,000 helicopter pilots in Canada.
Senator Bacon: Are you telling me that no one has a substance problem?
Mr. McCutcheon: No, I am not telling you that. I am saying generally they do not.
Senator Bacon: If I ever take a helicopter, I will have the pilot checked before. I will let you know.
The Chairman: The next group appearing before us is the Company of Master Mariners, and I would ask them to come forward. Captain, would you like to make some introductory statements and then we will get into some questions and answers, more to try and uncover problems that we might begin to deal with it, at a later time and upon reflection. With that little word, please commence.
Mr. Alan Knight, Divisional Master of the Maritimes Division of the Company of Master Mariners of Canada: Mr. Chairman, senators, I bring you greetings from the Company of Master Mariners of Canada. I am here representing Captain Douglas Wilson, who is the national master of the company.
The Company of Master Mariners of Canada is a professional organization of men and women qualified to command Canadian merchant ships. Included in our letters patent is the stated intention to give evidence before royal commissions, courts of enquiry, committees and boards of any description, on all matters concerning the merchant service.
In speaking to you today, it is my intention to deal with three subjects, namely, regulation and enforcement, training and accident investigation. First, regulation and enforcement. Regulation of the marine industry in Canada is done by the Marine Safety Branch of Transport Canada under the authority of the Canada Shipping Act and various regulations made thereunder.
Canada is also a signatory to many other international conventions, such as the Safety of Life at Sea Convention, know as SOLAS, the International Load-Line Convention, the Standards for the Training and Certification of Watch-keepers Convention, known as STCW, and the Merchant Shipping (Minimum Standards) Convention, known as ILO Convention 147. Canada has written these conventions into its national legislation. These conventions are continually evolving in the light of experience and changing technology.
When on September 28, 1994, the passenger ferry Estonia sank in the Baltic Sea, with the loss of 852 lives, the International Maritime Organization responded by establishing a panel of experts to review the safety of "ro-ro" passenger ferries, and Canada as a major user of ferries was represented. Extensive modifications relating to the design and operation of these vessels was made to the International Convention for the Safety of Life at Sea, SOLAS convention regulations, at the conference held in London in November 1995. In addition, amendments were made to the International Association of Classification Societies standards relating to the design, operation, strength and securing arrangements of bow doors. These changes are presently being adopted on ro-ro ferries engaged in international voyages.
The Marine Safety Branch of Transport Canada is presently reviewing these international regulations to determine their applicability to domestic ro-ro ferries. The Company of Master Mariners of Canada supports these moves, and recommends that Canada adopt the international standards, both for safety reasons and also to guarantee the resale value of Canadian ferries when they are sold foreign at the end of their working life in Canada.
An earlier ferry disaster, the capsize of the British ferry Herald of Free Enterprise at Zeebrugge, with the loss of 159 lives, led to a realization that most accidents are not simply the result of equipment failure but a failure of management practice, both aboard and ashore. This led to a call for the mandatory incorporation of good management practice along the lines of ISO 9000 into the marine industry. This, in turn, led to the introduction by the IMO of the International Safety Management Code, which will become mandatory on passenger ships, ferries, tankers and bulk carriers in July of 1998.
Some Canadian shipowners have expressed concern at the cost of setting up the mandatory auditing procedures, and are considering asking for an exemption for Canadian ships on internal trade. Whilst we sympathize with this problem in a competitive market, we feel that cost savings derived from clearly defined lines of command are real, and that if Canadian shipowners do not get on board with the international safety management code, they will find themselves "ghetto-ized" in Canada, and unable to compete for international business. We feel that Canadian shipowners have much to gain by adopting the international standards.
Many sinkings and disappearances of bulk carriers, sadly as many as ten a year, claim the lives of many seafarers, and this has led to the introduction of enhanced survey requirements for bulk carriers by the International Association of Classification societies. Canada, as a major exporter of raw materials, is a heavy user of bulk carriers, and has instituted the Canadian Bulk Carrier Inspection Program, run by Transport Canada Marine Safety Branch, which in turn has resulted in the detection and detention of several seriously defective bulk carriers.
A realization that loop-holes in the 1978 Convention on the Standards of Training and Certification of Watch-keepers was allowing some nations to flood the labour market with inadequately trained seafarers, led to the passing of the 1995 STCW Convention.
Faced with this flood of international legislation, to which Canada is a signatory, the Company of Master Mariners organized a conference in order to review them in a Canadian context at Halifax in October of 1996. This conference was attended by the then Deputy Minister of Transport, Mr. Nick Mulder, senior representatives from Transport Canada, the Canadian Coast Guard, the Department of Fisheries and Oceans, shipowners, classification societies, marine lawyers, charterers, hydrographers and marine surveyors. At that conference, we heard from some excellent expert speakers. Then, in a series of workshops, we evolved recommendations for Canadian action on marine safety which were presented to the Minister of Transport in Vancouver in November of 1996 by the conference chairman, Captain Angus McDonald.
There is no dispute within government or industry that the Canada Shipping Act is now outdated and in need of an overhaul. This is now taking place, and the Company of Master Mariners of Canada is providing input. Whilst most of the items under review are necessary and non-controversial, one proposal concerns the Company of Master Mariners greatly. This is the proposal to allow delegation of ship inspection in Canada from Transport Canada to the classification societies such as Lloyds, the American Bureau of Shipping, Det Norske Veritas and Bureau Veritas. These classification societies are foreign-owned, not-for-profit companies that all operate through Canadian committees.
In recent years, there has been much concern in the marine industry as to the quality of classification society inspections. This is borne out by the fact that of the 149 ships detained by Transport Canada in 1995 as having defects so serious that they were not permitted to sail until repairs had been done, every one had valid safety certificates issued by a classification society.
Concerns that classification societies were not adequately policing ships were given substance by a series of pollution incidents culminating in the stranding and destruction of the oil tanker Amoco Cadiz on the West Coast of France in 1976, which resulted in the spillage of 200,000 tonnes of oil on fishing grounds and tourist beaches. This resulted in the establishment of the Paris Memorandum of Understanding on Port State Control, wherein the EEC countries agreed to inspect ships calling at their ports and to check that they were in compliance with international conventions.
Canada became a cooperating member, achieving full membership in 1992. Canada is also a member of the Pacific Rim Port State Control Organization, which is headquartered in Vancouver, and thus we play a central role in marine safety in the two major oceans.
Under the provisions of Port State Control, Canada inspects visiting ships, assesses their condition and if found to be defective stipulates the repairs to be done before the ship will be allowed to sail. The details of the inspection are entered into a data bank, which is accessible to all Port State Control member nations. The importance of Port State Control to marine safety is shown by the fact that in 1995, the last year for which figures are available, Canada inspected 1,348 ships, and of these, 149, that is, 11.05 per cent, were detained as having defects so serious that they were not allowed to sail until they were repaired.
It is impossible to quantify the amount which Port State Control thus saved in pollution not caused, search and rescue airplane fuel not burned, and seafarers' lives not needlessly lost, but it is certain that Port State Control is a very cheap form of insurance for the Canadian environment and for the Canadian taxpayer.
I would now like to move to the issues of training. The severe recession of the 1980s left many shipowners in a weak financial condition worldwide. Desperate to cut costs and survive, they moved their ships out of the registries of the traditional maritime nations such as Canada, the U.S. and Great Britain, with their high regulatory standards and unionized workforce, into the so-called flags-of-convenience states, where they were able to take advantage of low registration fees, lax or non-existent taxation regimes, and in some cases lax safety regimes. A further bonus was that flags-of-convenience states do not require shipowners to employ their flag nationals as crew. The shipowner was thus free to employ cheap Third World crews. Some were poorly trained and standards fell, creating the need for Port State Control.
A side effect of this was that recruitment and training of seafarers in the industrialized countries virtually ceased. Thus, in 1997, Canada, in common with the other OECD countries, has an aging workforce. According to the BIMCO/ISF/Warwick University 1995 Report, of which I will make a copy available to you, entitled "The Worldwide Demand for and Supply of Seafarers," OECD nations' officers are concentrated in the 31 to 50-year-old age group, 57 per cent of them being in this group, 15 per cent are in the 51 to 55-year-old age group, 7 per cent are above the age of 55.
The Canadian picture was given by the 1992 Peat Marwick Stevenson and Kellogg report entitled "Human Resources Study of the Canadian Marine Transportation Industry." This report, which admittedly was written at a time when the Canadian economy and the marine industry was deeply mired in recession, paints a grim picture of an aging workforce, aging ships, dwindling investment, dwindling recruitment and dwindling career opportunities. Whilst happily the Canadian economy is now recovering, and so is the marine industry, the training and recruitment problem remains.
There are serious problems ahead for Canadian marine safety arising from the drought of recruitment during the 1980s. Canada as a major trading nation needs large numbers of marine-experienced persons in shore-based positions as government marine surveyors and administrators, harbour masters, marine pilots, stevedore superintendents, insurance assessors, pollution control officers, tugboat crews, ship managers, ship charterers, ship repairers, accident investigators -- the list is long.
The needs of national defence must also be considered. The Gulf War showed that even the United States military was seriously embarrassed by its shortage of merchant seafarers. One U.S. reserve fleet container ship sailed to war carrying vital munitions and an 84-year-old chief engineer, for he was the only man available with a steam certificate. Only by such desperate measures was the U.S. able to mobilize its war machine.
Mutinies amongst Third World crews refusing to sail to war were common, though such reports did not make it into the media.
If you want experienced, qualified men and women to ensure Canadian marine safety, you must begin training them ten years before they are needed, for that is the lead time needed to get the experience in senior level qualifications. You must also bear in mind that due to the extraordinary stress which seafaring places on family life, fewer than ten per cent of those who embark on a seafaring career will actually achieve senior officer status.
All the other issues of regulation and enforcement become irrelevant side shows if Canada does not have the trained personnel to make its transportation system work. This is not a theoretical concern. Many of the traditional maritime nations of Europe are now facing critical shortages of trained officers, directly attributable to the drought of recruitment in the 1980s. When the Dutch passenger ship company Holland-America Line built six new cruise ships in the mid-1990s, it found that there were simply no Dutch officers left. It needed to hire British officers to man these prestigious ships. This is akin to Air Canada needing to hire U.S. aviators because no Canadians are available.
Increasingly, as European seafarers retire or move into shore-based management positions, their employers are finding that the only way to replace them is to hire Third World seafarers and give them citizenship. If we in Canada want to continue to grow our own, we must make berths available for young men and women. The Company of Master Mariners realizes that this is no easy task at a time of budgetary restraint. The Canadian Coast Guard has traditionally been a centre of excellence, but it can no longer afford to train large numbers of personnel. Commercials shipowners in Canada show varying degrees of commitment to training, but they can only train small numbers.
Out-placed Royal Canadian Navy officers are of excellent quality but few in number, and they require extensive retraining in commercial operations. The Nautical Professional Society of British Columbia, of which the Company of Master Mariners is a partner, attempts to procure berths on foreign-flag ships for young officers in order that they may gain the experience. In addition, the Company of Master Mariners of Canada, in partnership with the Honourable Company of Master Mariners in the U.K., is developing a mentoring scheme to guide young officers in their careers.
Worthy though these initiatives are, none will be sufficient to give Canada enough marine officers in the future. We must accept that Canada is competing in a truly global marketplace for a scarce resource: experienced seafarers. Canada does so with one hand tied behind its back, for most of our competitors in Europe grant tax breaks of 100 per cent to seafarers who stay out of the country for six months of the year. Canada has no such concessions, with the result that many Canadian seafarers are tax exiles.
The organization of marine training in Canada, with education funded by the provinces, while examination and certification is done federally, makes it difficult to get the picture of the state of marine labour supply and demand. The "Human Resources Study of the Canadian Marine Transportation Industry," to which I referred earlier, makes a recommendation that a marine training advisory board be established. This report I have just mentioned came out in 1992, and as yet no such board has been established, but the Company of Master Mariners of Canada feels that such a board, composed of unpaid volunteers, could play an important role as a collector and disseminator of data, and in pointing out developing problems before they become crises.
I now move to the field of accident investigation. Effective accident investigation is essential to the safety of any marine transport system. Following the Arrow Air disaster at Gander, Newfoundland, in 1985, the Canadian Transport Accident Investigation and Safety Board, known as CTAISB, was created. This was designed to be a multi-modal investigative body, reporting not to the Minister of Transport but to the Privy Council as a way of guaranteeing its independence. Marine accident investigation, formerly carried out by a department of the Canadian Coast Guard Ship Safety Branch, now the Marine Safety Branch of Transport Canada, was given to CTAISB, the rationale being that Ship Safety Branch should not be both the licensing agency and then, following an accident, investigate a ship or ships that it had itself certified. Unfortunately, this has proven to be a case of the cure being worse than the disease.
The Canadian Transportation Accident Investigation Safety Board is basically the old Aviation Safety Board, with road, rail, pipeline and marine elements bolted on. Despite having highly experienced marine accident investigators on the waterfront, CTAISB's multi-layered bureaucracy, most of which has no marine experience, results in glacially slow report production, with three years from the accident to publication being the norm, and five years being not uncommon. It also produces reports which miss or underestimate vital issues, and has resulted in the field investigators being badly demoralized and sometimes disowning their own report, feeling that it has been rewritten so heavily that it no longer accurately reflects their investigation.
The Chairman: That is rather a serious charge, captain, that people are rewriting accident investigators' reports?
Mr. Knight: Yes. It passes through so many stages, senator, that if only one word is changed each time, you end up with a very different product at the end.
Senator Bacon: This happens?
Mr. Knight: Yes. I could name names of investigators who have had this happen, but I am not prepared to do so. These are men who are known to me personally.
The Chairman: I am in a bit of a dilemma. The reputation of accident investigators must be protected, and so must the board's. I am a little shocked, and very disappointed to hear that. I would have thought that the integrity, the credulity of the investigators and the process -- I am sorry, carry on, I want to think about this for a little while. It is a very serious accusation, and I am glad that you have not held back, that you have been frank enough to suggest that to us, because it then causes us to begin to think about the process as it relates to safety, and the integrity of the process must be very important to this committee, not to mention to the users.
Mr. Knight: Absolutely.
The Chairman: Carry on. I did not mean to abruptly interrupt.
Mr. Knight: The Company of Master Mariners of Canada has little confidence in the safety board as presently constituted. When Parliament established the Canadian Transport Accident Investigation and Safety Board, it mandated that, after five years, a review commission should gather evidence as to the effectiveness of CTAISB. This commission was set up under Mr. Louis Hyndman, QC, and toured the country in 1993, collecting evidence which was compiled into a report entitled "Advancing Safety," which was heavily critical of CTAISB's performance, particularly in the areas of report quality and timeliness of dissemination.
Following the publication of "Advancing Safety," CTAISB assured the marine community that it would respond to the review commission's findings and, indeed, for an interval timeliness improved. Now with the Hendon Review Commission but a fading memory, CTAISB has reverted to its old ways, with three years the norm for production of reports. If accident investigation is to have any value, CTAISB must report its findings promptly to industry, in order that potential hazards may be avoided. As an example, report number M93COOO3, entitled "Striking by the Bulk Carrier NIRJA of the tanker Hamilton Energy, Hamilton, Ontario, 11 December 1993," contained important recommendations on the subject of fatigue and its effect on judgment and perception. Yet the report was not published until December 23, 1996, a full three years later. A report on a subject so important should not be delayed for three full years before reaching its intended audience.
Letters of comment and complaint by the Company of Master Mariners to the Privy Council are replied to with the statement that "Your comments have been forwarded to the chairperson of the Transportation Safety Board." We see no evidence that the Privy Council exercises any surveillance of, or influence over, the Transportation Safety Board and we feel that CTAISB operates without any form of parliamentary oversight. We can only echo the words of the Hendon Commission report at page 9, and I quote:
Did the new legislation successfully address the kind of problems which developed at the Canadian Aviation Safety Board? Our conclusion is that it did not, and that new difficulties were created in its attempt to do so.
With the Hendon Commission report now just a fading memory, the Company of Master Mariners of Canada looks to this Senate subcommittee to apply the wisdom of the house of sober second thought, and to suggest corrective action to the lamentable state of marine accident investigation in Canada.
Senator Roberge: Would it be possible that this committee receive copies of those letters of complaint that you have written?
Mr. Knight: I believe I have them at home, yes.
Senator Roberge: I think that would be useful to us. I will let the chairman ask you the question on that subject.
I just want to go back a little bit on one point that you mentioned in the beginning. You mentioned that the Ministry of Transport will be subcontracting out, I guess you would call it, to one or more classification societies all of the requirements that the ministry needs, and you say that, if I understood you correctly, some of those classification societies issue seaworthiness certificates that can be doubtful?
Mr. Knight: Yes, this is the case.
Senator Roberge: What would you recommend? Would you recommend that that function stays within the Ministry of Transport, or is there another organization that it could go to?
Mr. Knight: My recommendation is that it would stay with Transport Canada, the reasoning being this: The classification societies are paid directly by the shipowners. This leaves them open to commercial pressure. The classification society, if we go back 25 years, was basically a club of rich industrialized nations, basically it was co-existent with the OECD. In the post-colonial era, many countries have set up their own classification societies, many of them little more than brass plates with poor inspection records.
There is also a considerable body of evidence that corruption sometimes takes place, particularly in Third World countries. I am not saying that this would happen in Canada, but the point of the Copenhagen Declaration, which Minister Young signed in 1995, I believe it was, was that Port State Control inspectors should be civil servants in order to guarantee the independence of their paycheque. A classification society can always be told by an unscrupulous shipowner that "if you do not issue the certificate, there are plenty more out there who will," and it is no idle threat when there is something like 55 of these bodies in the world now.
Senator Roberge: What saving would there be, or would you know, that would benefit the Ministry of Transport if they were to farm it out? Is it substantial?
Mr. Knight: I feel that the savings would be illusory.
Senator Roberge: I can understand that, but I am just trying to get some hard numbers.
Mr. Knight: It is very difficult to quote figures when the classification societies are private companies and do not report profit figures. I suppose you could say that Transport Canada could downsize its marine inspectors, but then, you see, the thing is you can delegate the inspection but a nation cannot delegate the responsibility. It is written in the fine print of everything that classification societies do that "this is not a document of seaworthiness; you cannot sue us."
Indeed, this is a very hot issue in the marine world right now. There have been several cases. There was one of a ship called the Sundancer, which sank on the west coast of B.C. It ran aground and then subsequently sank. The American Bureau of Shipping were the classification society. They had failed to spot that a non-return valve, which should have been in the gray water system, was not there. The shipowner then tried to sue ABS, saying that they had failed in due diligence. The case went to court in the U.S. and failed because the rationale was, quite rightly in my opinion, that the shipowner has a totally non-delegatable duty to ensure that his ship is seaworthy. He cannot pass on the responsibility. I know the same holds true for governments: you can delegate the inspection but you cannot delegate the responsibility.
Senator Roberge: There is no other organization in Canada which could do this?
Mr. Knight: Not to my knowledge.
Senator Roberge: Not even an association of former masters, or something?
Mr. Knight: The American Bureau of Shipping was indeed set up by master mariners about 100 years ago. You can do anything if you put enough money into it and enough time, but given the realities of the marketplace today, I do not think that is an option at this time, senator.
Senator Bacon: I am quite surprised that there is a problem with recruiting and training of young people. Is there anything that is done with schools, visits to schools to try and interest young people to become mariners?
Mr. Knight: This has not been the case for some considerable time. I am talking about a 15-year time span, certainly. When I was a young man back in the 1960s in England, it was quite common that shipping companies would indeed try to recruit people. As we all know, in the 1960s jobs were plentiful and companies were competing. What has happened, of course, in the last 15-year time span, is that everyone had plenty of everything when it came to the labour supply, and no one has had to think in these other terms.
As I alluded to earlier, the European countries are now finding that this drought of recruitment that they experienced in the 1980s is now coming home to roost, more so as the "baby boomer" generation of seafarers are now getting within the five- to ten-year group for retirement. As a matter of fact, Transport Canada did an internal study about three years ago, and found that 60 per cent of their staff, I think it was, were within five years of the retiring age. It is not just the numbers; it is the age distribution that is a big problem.
Back to your original question, there is none at this time, although certain Canadian companies are realizing the magnitude of the problem that is sweeping down on them and are now trying to institute their own training programs. The problem here, as I depicted earlier, is that the wastage rate among seafarers is so high, the demands of family and home knock most people out of the system, that to stay in the industry for 30 years, as I have done, really puts you in the freak category. Just recruiting enough people now to replace the baby boomers in ten years' time will be a logistical problem.
Senator Bacon: Is it because recruitment and training are so costly and, as you say, we will probably not see too many people in the same job for 30 years -- it is a matter of five years sometimes -- that that is too much money to spend to recruit here?
Mr. Knight: This has been the problem, you see. The rationale was that, in the desperate days of the early 1980s, shipowners were desperate to cut their costs, and one of the few places where a shipowner has control over his costs is his crewing. Everywhere else there are hard costs: your mortgage payment, your insurance, your fuel, and so on. In desperation, they fired their industrialized nations crews and hired Third World crews at greatly reduced labour rates. But what they are finding is that with these Third World crews, some of which were poorly trained, the insurance claims have gone up dramatically, and they are running into problems with the quality of their senior officers.
Senator Bacon: That is a major problem too?
Mr. Knight: Yes.
Senator Bacon: What is the major improvement that you would want us to recommend, as far as the Canadian Transportation Safety Board is concerned, if you had one recommendation for us to make?
Mr. Knight: Get the reports out inside a year.
Senator Bacon: It would be about the reports?
Mr. Knight: In addition, if it is something of obvious importance, there should be a single sheet of paper nailed to the wall of every legion hall in every fishing port in Canada within a month. I quote one example of the sinking of the Capasby. That was a fishing boat which sailed from southwest Nova Scotia, got into very bad weather, and because somebody left a watertight door open, the ship flooded and sank with the loss of the lives of several of the crew members. There was a very important safety lesson to be learned here, and yet the report was -- I forget exactly, but three or four years in the making. I find it completely unconscionable that such matters are not deal with within a much shorter time scale than this. I would rather have a highly imperfect report in one month than a perfect report in three years.
Senator Bacon: We remember the Exxon Valdez disaster, where the pilot was under the influence when the incident occurred, we were told.
Mr. Knight: The pilot?
Senator Bacon: Not the pilot; the captain. I am still with the airlines, or helicopters.
Following that incident, is alcohol or substance testing implemented in your organization?
Mr. Knight: Implemented very rarely; threatened, yes.
Senator Roberge: What do you mean "threatened"?
Mr. Knight: If you suspect that somebody is under the influence of alcohol, you can ask for them to be tested. This is usually a company policy.
I must say, senator, that this is, in my opinion, not a problem. No sociologist, to my knowledge, has written their Ph.D. on this subject, but the transformation of the marine industry from a home of hard drinkers to what I consider to be probably the most abstemious industry in the world in the space of 20 years has been quite extraordinary. You never are offered alcohol on merchant ships these days except on ships of the former Soviet Union. In my time as master of ships in Canada, which was some seven years covering some 20 ships, I can think of only one incident where alcohol was involved, and this was as a result of an illness. We took on a man at very short notice; he clearly had a problem with alcohol, and was fired in short order because of it.
Due to the fact that shipowners have cut down on the size of the crew so much, which was partly to save costs but also because automation has allowed them to do so, ships crews are now small. If anyone resorts to alcohol, everyone else is having to carry the load, which would immediately make them very unpopular and they would not last long.
I am not aware of it being a problem, although I was very interested in the comment of the previous gentlemen, the helicopter pilot or operator, and perhaps I may be allowed to give some illustration. I was master of an oil rig supply boat, which was a Canadian flag, and alongside a U.S. flag oil rig. One day, down came the personnel basket with a man whom I had never seen before and a dog. He reported to me in the wheelhouse and said "I am here to do drug sniffing with the dog." I said, "Well, a couple of points here. First, under whose authority are you here?" "I have been hired by the oil rig company." I said "Very well, that is a U.S. company; that is a U.S. oil rig. But you are now on Canadian territory. Whatever writ you have, it does not run here." He was very reasonable about it. He said, "Look, I am ex-U.S. Navy. I know the rules of the game."He said, " I have been sent down; can I please stand here?" and I said, "Help yourself to a coffee." My cook fed the dog, and I fed the man with coffee, and that was the end of the story.
However, there is a potential problem here, where many companies in the oil industry are U.S. owned and do not, perhaps, understand some of the implications of national sovereignty. So far, we have always avoided an incident, but there is a potential problem there.
Senator Bacon: Safety measures are important.
Mr. Knight: Safety is everything. As master of a ship, my view is that that is my absolute responsibility, my absolute duty. If I have any doubts as to whether someone is under the influence of alcohol or drugs, then it is my responsibility to get rid of them.
Senator Bacon: Are you saying that the masters are all sensitized to that?
Mr. Knight: Absolutely. The reason being that the charterers, who very often are oil companies as well, usually will stipulate in the charter party, the contract of hire of the ship, that alcohol or drugs are not permitted.
Senator Adams: Previously you mentioned about having a problem with some of the marine workers. I am concerned about companies being allowed to hire any other foreigners and shippers, and such as that. Does Canada have a regulation saying that a company here in Canada can hire a ship from another country to come here and load their ships, and stuff like that?
Mr. Knight: If you have a Canadian flag ship, you must employ Canadian crew on it. This goes back to the point I was making earlier about the switch to flags-of-convenience states enabling owners to employ nationals from whatever country they wished, and they could, in effect, window shop for the cheapest crew, which has led to severe problems in the industry. Now, under Port State Control, which as I said earlier is run by Transport Canada's Marine Safety Branch, amongst the inspections which would be done by Port State Control is assessing the level of crew competence. Indeed, under ILO147 and the Standards on the Training and Certification of Watch-keepers Convention of 1978 and the new one 1995, if a Port State Control inspector feels that a crew is not adequately trained in their duties, that, in itself, is grounds for detention or for an order for retraining of the crew.
Senator Adams: Right now, with all of the ships travelling anywhere in the world, do you not have any experts travelling with special cargoes? Say, for example, you had a special type of load, maybe dangerous goods or something like that. Are there people in the crew who know about the handling of such materials? Or do you not have to be on the ship, but either be transported by aircraft or whatever, to go in there and unload? Is that how the system works?
Mr. Knight: It is not unknown but it is rather rare, and usually this would only tend to be with dangerous goods, dangerous chemicals, things of this nature, or cargoes of extraordinarily high value; for example, an airplane flight simulator, or something like this. In such cases, a cargo superintendent, or "super cargo" would travel with the cargo to ensure that it is properly cared for.
Senator Adams: And those companies, shippers, do they need those kind of tradesmen?
Mr. Knight: Do we need them in Canada?
Senator Adams: Yes.
Mr. Knight: Absolutely. We need them as government inspectors, but also there are many companies in Canada who need to have them either in-house or available in the yellow pages so that they can call them in as consultants. However, the only way you can get this experience is hands-on, by sailing on ships carrying this sort of cargo.
Senator Adams: You have the authority of some of the owners -- or perhaps people do not have complete ownership, now that we are selling a lot of goods to other countries, especially lumber and that sort of thing, because we have free trade with other countries. Somebody mentioned that Canada has a reputation for safety at sea. What happens, say, if you get a phone call from a Greek shipping line, inviting you to bring Canadian operators, such as the engineer and the captain, and they will supply all the rest of the crew. From there it might only mean one of those Canadians being taken on with that ship to work. Would that be legitimate?
Mr. Knight: There is nothing to stop a Canadian crew working on a foreign-flag ship. Of course, it is up to the owner to hire who he wants.
Senator Adams: The only thing is what are the different rates, the costs between one ship and another, you know, for the hours?
Mr. Knight: Yes, this is it. The example that is commonly quoted is if you fire your Canadian crew of 25 men, with costs around $2.5 million a year in labour costs and hire a replacement crew of Filipinos, your costs will fall from $2.5 million Canadian to about $600,000. Indeed, for the countries of the former Soviet Block that are now, of course, desperate for hard currency, you can go even lower than that. It is very difficult for Canadian shipowners to compete on labour costs.
Senator Adams: You mention that you have been working on oil rigs, and I am not sure what it was called, but the one that belonged to Mobil Oil, the one that sunk, and several people were killed -- ?
Mr. Knight: Is it the Ocean Ranger you are referring to?
Senator Adams: Yes.
Mr. Knight: I cannot remember which oil company it was.
Senator Adams: Because that rig was American owned, was there a problem with the investigation? In other words, was it necessary for that incident to be investigated by the American government, or did the Canadian government have a hand in that? How did that work? Are you familiar with that at all?
Mr. Knight: I am not terribly familiar with it, no. However, I did read the report when it came out. Usually, what happens in these circumstances is that governments will cooperate and conduct a joint investigation.
Senator Adams: The only thing I am concerned about is if it happens in Canadian waters, is the investigation carried out under Canadian law or American law?
Mr. Knight: Both, because it was a U.S. flag rig.
The Chairman: I will be very brief. At some point in the future, I will get back to you. This question that you raise about the investigative reports being rewritten without the benefit of even consultation with the author, disturbs me very much. There must be some impairment of the process. If the problem and the sickness is the length of time it takes from the point of the accident to the production of a report, if that is the sickness then surely we can find some way of curing that, which I think is in part what you are suggesting. However, if we cure that maybe problem, perhaps some other things might happen. How do you suggest we go about it?
Mr. Knight: My feeling is that while CTAISB is configured in the way it is at present, with the multi-layer reporting system, you cannot get around this slow reporting. The way in which I think the system should work is that a field investigator should be told "It is your investigation; go do it. You have three months to prepare a report and present it to the board and defend it." It would be a bit like defending a Ph.D. thesis. The board should have the expertise, or be able to draw on the expertise, either in-house or from industry, to question the investigator, try to pick holes in his argument, offer alternatives that he may not have thought of, and on that basis possibly rewrite, restructure the report. Ultimately, however, it will be the responsibility of the field officer to put his report of the investigation before the board, and to defend it.
The Chairman: The structure of the safety board itself, the accident investigation board, is that an impediment to what you are suggesting? The way in which it is set up?
Mr. Knight: The way, as I understand it, in which it is set up is that each of the board members should have expertise in one or more of the fields of transportation. I realize that this is very difficult requirement to fulfil, but there is a way around it. As I said, the board can be the board, but they should have the right to call on experts, as happens with the British investigation system; they can call on persons with a particular expertise, be it in liquid gas tankers, in passenger ferries, to advise them. The board still has the responsibility for the production of the report, and for questioning of the experts.
Our present system is unrealistic inasmuch as it expects -- and requires -- expertise on the board that I do not think it is entirely reasonable for them to have, but the present system deprives them of the ability to call in these outside experts.
The Chairman: I did not realize that. You have certainly given us some food for thought, particularly with respect to crewing.
Senator Roberge: To your knowledge, with respect to these delays in producing the reports, is it mostly related to marine incidents, or does it also apply to other incidents, involving airlines or trucks or whatever?
Mr. Knight: I cannot answer that, senator. I am only familiar with the marine world.
Senator Roberge: Do you know if anyone on the board has marine experience?
Mr. Knight: The board has recently changed its personnel, and I am not familiar with any of the present board members, so I do not know. The previous marine representative was Vice-Admiral Hugh McNeil. This we were somewhat worried about because the worlds of warships and merchant ships are very different, and unless you have somebody with this particular expertise, which takes me back to my earlier reply to Senator Forrestall, unless you have the expertise in-house, or the ability to pull that expertise into the house when you want it, the quality of the report will suffer.
The Chairman: Just in connection with that, just a very quick quote and we will bring these hearings to a close for the time being.
Mr. Learn, who is a railway locomotive engineer out west told us -- he was a little more blunt than you are -- that while there was minimal action, and we knew each other and respected each other on that basis, that was good; once we write the report of the investigation, it is gone from our hands. In 30 days it is in Ottawa, and we do not see it again. It will come back to us with the note "We have made some changes, do you agree?" I can go on to explain that, but I think it is somewhat self-explanatory.
In any event, the point that he was making is that they write a report, it goes out of their hands, somebody toys with it, 30 pages become five pages, and there is no resemblance to the report that was originally written. The fault is not only in the marine field, it is with surface, and presumably this is less true with air, I hope, but let me assure you that the reason for all of this was to remove the potential conflict of interest.When I first wrote that bill, that was the purpose of it: to remove the regulator from any responsibility, or anything whatsoever to do with the investigation that might arise out of an incident that involved those very same regulations. I think that was a sound principle, and I think we moved in that direction, and I commend successive governments, not for taking my bill, but that it was a good idea to put forward. Somebody said, "That is a good idea and I will write that myself." Well, that is what has happened. We will take your admonition to heart. It is a very serious charge, and we will look much closer at the facts.
In the meantime, captain, I know I express, on behalf of all of us here, our appreciation for your coming today, for your thoughtfulness, for your presentation and for your frankness. We look forward to mulling over your evidence and your comments, and when we get to the point where we can identify the problems, and then give consideration to solutions, we may very well want to speak to you again.
Mr. Knight: I will be happy to do so.
The Chairman: Unless there is any our further business, I think most of you will want to leave our fair city.
The committee adjourned.