Proceedings of the Standing Senate Committee on
Transport and Communications
Issue 27 - Evidence
OTTAWA, Wednesday, April 17, 2002
The Standing Senate Committee on Transport and Communications met this day at 5:32 p.m. to examine issues facing the intercity busing industry.
Senator Lise Bacon (Chairman) in the Chair
[English]
The Chairman: I wish to welcome our witnesses to this hearing.
[Translation]
This evening, we will be hearing from two witnesses from the Rural Secretariat, a government body which, I hope, will enlighten us about the needs of a significant segment of the bus transportation clientele and Autobus Maheux, a Quebec bus company.
[English]
For the benefit of our witnesses, I will say a few words about why we have been asked to study intercity busing. The essence of the problem is that intercity bus ridership has been steadily declining for several decades. This decline is troubling because the bus mode is an important part of the passenger transportation system.
The bus mode is inexpensive, can go virtually everywhere and is environmentally friendly. There are several possible explanations for the decline. One is that people are better off than they used to be and are travelling by automobile. It could be that more people are living in big cities. It could be that there is too much government regulation and that it varies too much from one province to another.
This is what we hope to learn about in the weeks and months to come. Our first witness will be the Rural Secretariat, followed by Autobus Maheux.
I would ask the Rural Secretariat to please proceed.
Ms Donna Mitchell, Executive Director, Rural Secretariat: Madam Chair and members of the committee, thank you for inviting the Rural Secretariat to be here today.
[Translation]
I am pleased to have this opportunity to make some comments about transportation and rural communities and to answer questions.
I am the Executive Director of the Rural Secretariat in the Department of Agriculture and Agri-Food. With me is Mr. Fortin, Manager, Policy Development Section and Rural Lens.
[English]
The Rural Secretariat recognizes that its research in transportation issues is not extensive. We have not had the technical expertise to provide comments on issues such as concentration of ownership and bus safety standards, nor do we have an extensive analysis of deregulation. However, we have concentrated on the issues brought to our attention by rural citizens and the experiences that we have observed in other countries.
We have noted that the Solidarité rurale du Québec has appeared as a witness before this committee. As an umbrella organization in Quebec, it is regarded as a key rural voice. Many of the concerns in their brief are consistent with our perspective, particularly the importance of transportation for the health and employment of rural residents and their overall participation in community life.
They also emphasize the implications for those who are aging and those who are economically disadvantaged. Consistent with our view and the British approach, they want public transportation to maintain and revitalize small communities and prevent the exodus of their residents.
The role of the Rural Secretariat is to coordinate with its federal partners to help ensure that national policies and programs have a positive impact on rural communities and to strengthen the capacity of rural communities in Canada. Therefore, my comments will focus on transportation challenges as they pertain to rural communities. I will talk about rural transportation needs for travelling to work, community economic development and accessing health services. I will note some of the work of the Rural Secretariat and share what rural Canadians have told us about their transportation barriers.
Also, the Rural Secretariat has mechanisms for accessing the rural voice. We would be pleased to offer their use should the committee be interested in consulting users of intercity transportation systems who live in rural and remote Canada.
Finally, because of the interest expressed by the committee in the experiences of Britain and the United States, I will also highlight some of the recent efforts in those countries and some preliminary observations that may be important to decision makers in Canada.
Our discussion of rural in Canada is complicated by the many existing definitions of what rural Canada is and by the lack of statistics at the small community level. There are two definitions commonly used in defining ``rural.'' Based on the definition of the Organization of Economic Cooperation and Development — OECD — 31 per cent of Canada is considered rural, with a population of less than 150 persons per square kilometre. Statistics Canada denotes rural as towns with a population of less than 10,000 persons, or 22 per cent of Canada's population, but the Statistics Canada definition excludes remote communities with populations of between 10 and 20,000, which most of us would consider rural by nature.
Canada has one of the lowest population densities within the OECD. According to the 1996 census, there are about 9 million Canadians living in rural and remote Canada. The recently published census data shows that the population in rural areas grew at a rate of less than 1 per cent between 1996 and 2001, compared with growth in urban areas of over 3 per cent.
Our rural population has a greater proportion of elderly Canadians than its urban counterpart, which suggests transportation solutions must take into account an older population.
Some communities, such as North Hatley in Quebec and the Okanagan Valley in British Columbia, are attractive for retirement, also indicating a need to consider age-appropriate services and infrastructure.
Canada's rural geography, with its widely disbursed population, poses challenges that do not exist in other countries for delivering public and private sector services such as transportation. A lower population density drives the per capita cost of basic infrastructure considerably higher than in urban Canada. Many rural citizens express the view that existing infrastructure is inadequate to support the movement of goods and services for a growing economy.
Further, rural and remote Canada is not homogeneous. For our purposes, we delineate three distinct types of rural communities, which are defined in part by their interdependence with and proximity to the urban economy.
First, there are relatively prosperous rural communities such as Osgoode and Manotick in Ontario, which are adjacent to urban centres. We call them metro-adjacent. They have a sufficient tax base to support adjustment and to attract private-sector partnerships. Their transportation challenge is how to integrate their needs into the urban development strategies, including public transportation strategies, of the nearby cities.
Second, there are rural communities located in the heartland of Canada, such as those found in the Annapolis Valley. They are further away from the urban core and more disbursed. Often, they have resource-based economies and large youth out-migration and aging populations. They require transportation policies that will help bolster long- term socio-economic stability and support communities to develop their human capacity.
In both the metro-adjacent and heartland communities, a significant portion of family income comes from their employment in urban centres. They need access to transportation to keep their jobs and to get their goods to market.
Third, remote communities such as the Gaspé region in Quebec are linked to a sparse roads network. Because the region is located so far from markets, the cost of transportation is a challenge to the economic development of the region, affecting both the viability of businesses as well as the sustainability of the community.
Remote communities also include northern ones, like Rankin Inlet. They have a young Aboriginal population and risk becoming permanently marginalized. All remote and northern communities require solutions that provide socio- economic sustainability.
[Translation]
Each type of rural community has different challenges with respect to transportation, and each requires its own specific solutions.
In our work, we remind people that we should perhaps pay special attention to the viability of communities located in Canada's heartland, and in remote regions.
[English]
As you may be aware, the Rural Secretariat has a horizontal coordination mandate. It does not have a mandate specifically for transportation. However, we do work with Transport Canada as well as other federal departments and agencies on an ongoing basis to provide advice and guidance on how to take rural and remote Canada into consideration while developing new initiatives.
Through the rural dialogues, the Rural Secretariat has reached about 10,000 Canadians over the last four years. The rural dialogues enable rural and remote Canadians to identify and discuss the challenges they face. Participants have told us that the lack of access to reliable and affordable transportation infrastructure is the key barrier to community development. For those who must travel long distances on a frequent basis to access health care, transportation costs are a genuine problem.
In 2001, the rural dialogue was held in Chapleau, Ontario. These participants discussed the challenges their communities face. A major theme was the need to have infrastructure to support and sustain community development opportunities. In particular, public transportation was regarded as an essential element that requires attention. Chapleau has no scheduled bus service and the roads are considered remote. Currently, it has a VIA Bud car service, which provides rides to and from Sudbury and White River three days a week. Participants contended that the lack of adequate transportation affects the communities' ability to diversify their economies and to access health and education services. In addition, it makes it difficult to obtain and keep a job, particularly for young Aboriginals.
Representatives of the Chapleau health services emphasize that accessibility of services is a major challenge and suggested improving transportation linkages with other communities as a possible solution.
In 2001, three regional rural conferences were held across Canada that echo the views experienced by those in Chapleau. In the B.C. conference, participants underscored that rural areas do not have many transportation options. Carpooling is nonexistent and there is no public transit. B.C. participants have consistently emphasized the difficulties in accessing health services. They are often distant and for those without transportation, for special groups like seniors, the disabled and First Nations, access is made particularly difficult. For these populations, travel is expensive, time- consuming, and takes a physical toll on those whose health is already compromised.
At the Ontario conference, participants identified the lack of transportation as a threat to their sense of community.
At the Nova Scotia conference, participants indicated that seniors, single parents, the disabled, post-secondary students, others on fixed income and those searching for work need an adequate and affordable rural transportation system.
We all need to be cognizant of what transportation means to rural individuals each day, and particularly, but not limited to, those on low incomes for finding and keeping a job, for maintaining health, for diversifying their communities and making them more prosperous and competitive.
The Rural Secretariat delivers the Canadian Rural Partnership, CRP, a four-year, $20-million initiative, which began in 1998 and has been renewed. A component of the CRP was the pilot projects initiative, which funded projects that were creative, transferable and had at least one federal partner. We have looked at the results of several pilot projects on transportation and have drawn a few conclusions.
In Antigonish and Guysborough County, a project was developed to help rural residents, especially the elderly, disabled and low-income, stay in the region by providing transportation to health services, grocery shopping and visiting family. In Bellechasse, Quebec, a project aimed to integrate existing passenger transportation and to promote linkages within the region. Neither project could make itself viable even though there was demand for the service. In the long term, sustainability was a problem, and users were frustrated with the lack of flexibility in matching their personal timing with the rides that were available.
Another component of our work is to promote research on rural issues. From this process, we observed that transportation came up consistently as a component that transcends almost all matters pertaining to rural service provision and the labour market in rural areas.
The University of Guelph rural planning and development school has written a number of reports on this subject, and we have helped support its research through the CRP. Some of its findings include citizens' concerns that rural transportation is generally viewed as Canada's forgotten issue and one of the reasons youth leave rural communities, as they feel ``they can't get around.'' They express concerns that rural roads are becoming increasingly important to sustain the rural economy as railroads decline and business start-ups increase across many rural landscapes. The investment in rural roads, however, has not kept peace with the importance of the rural economy in their view.
The rural transportation programs that coordinate and mobilize existing resources at the local level are inexpensive but not easy to run. Multi-stakeholder partnerships, both horizontal and vertical, are at the heart of successful efforts to improve transportation.
Lastly, their concerns included planning and land-use issues, which they find to be key to the rural transportation problem. Decision-making power regarding rural transportation may have to shift to local governments, in their opinion.
We believe strongly in informing rural Canadians and being informed by their points of view and their concerns and interests. Federal departments such as Transport Canada have access to the tools developed by the Rural Secretariat to consult rural Canadians. We would be pleased to offer assistance to the committee should it be interested in reaching and hearing the voice of rural and remote Canadians.
The rural lens is a tool for determining the impact of federal policies and programs on rural Canada before they are implemented. It also provides guidance on how to reach rural Canadians effectively. The secretariat encourages other departments to apply the rural lens and is available to work with Transport Canada and others on applying the rural lens on this issue. When the committee is considering solutions, you may wish to consider the guide to using the rural lens, of which we have supplied copies to this committee.
Through the CRP Web site, we can establish a link to your committee's Web site whereby rural citizens could access information on your work and provide their views.
Other countries have proposed changes to their rural transportation systems. In particular, Britain and the United States are addressing this issue. In November 2000, the British Parliament introduced a white paper entitled ``Our Countryside: The Future — A Fair Deal for Rural England.'' It aims to address the decline in traditional jobs such as in agriculture, falling revenues and inadequate services in rural areas. The British vision consisted of revitalizing the countryside by addressing four challenges: how to give rural communities a fair deal on service; how to rejuvenate and diversify rural economies; how to preserve and restore the rural landscape and environment; and how to give rural regions and rural towns the power and tools to shape their future.
Central to this approach, they identified the critical role of transportation in developing a thriving rural economy. They propose that investments in transportation infrastructure and increased funding for market-town rejuvenation would enable towns to become the focal point for transportation links and economic opportunity and enabling local councils to play a greater role in managing local facilities in partnerships with other levels of government.
Other transportation solutions proposed include reducing taxes for motorists, promoting car clubs, car sharing, dial-a-ride and taxi and mini-bus service through partnership projects, and providing grants to local parishes to develop community-based transportation solutions. It is too early at this point to evaluate the results of their proposals.
In their deliberations, they also noted that in rural Britain there is a higher ownership and use of automobiles. Eighty-four per cent of rural households own cars, compared with 69 per cent in urban jurisdictions, and rural residents use their cars more for basic travel. This leaves the one sixth of the population who do not own cars — predominantly youth, seniors, those with mobility impairments and low-income households — with an even greater challenge to get to school, to get to medical services and to do their grocery shopping.
The British example, although it has been developed for geography dissimilar to ours, is important because it views transportation as a key tool and precursor for local economic development and revitalization. It also advocates a flexible approach and aims to empower communities to have a greater say in decisions that affect them.
A recent publication by the U.S. Department of Agriculture overviews transportation issues in rural America for the 21st century. Here are some of the observations you may wish to take note of. The U.S. utilized a legislative approach at both the federal and state level. In both cases, efforts were made to integrate local community development into transportation planning. Legislation required that each state include local governments in such planning, and monies were earmarked for rural America. However, the results were mixed. While state and local governments have greater authority over transportation planning and funding decisions, the involvement of local governments was varied. It appears that the U.S. approach neglected to recognize that rural communities, unlike their urban counterparts, had no organizational structure to do transportation planning effectively. Communities were not ready to get involved just because their involvement was legislated. Their capacity had to be developed. It is reasonable to conclude that legislation by itself is not sufficient. A bottom-up approach requires capacity at the community level in order to be successful.
The U.S. experience indicates that transportation costs have significantly increased the costs of rural communities to maintain and upgrade local roads due to the higher volumes of traffic that have resulted from things like the North American Free Trade Agreement and a boom in the trucking industry. In developing a Canadian approach, it is important to consider both existing and new pressures on rural transportation infrastructure. These pressures need to be considered when taking funding decisions into account.
The U.S. made an effort to use technology to improve rural transportation safety and efficiency. From a Canadian perspective, technology could help Canada respond to safety challenges posed by weather and travelling long distances through isolated areas. Applications such as computer dispatch systems could also be cost-effective and efficient for overcoming barriers to long-distance travel.
In the U.S. example, we see how rural communities were affected over the period of deregulation and deregulating the intercity bus service, starting in 1982. Less than one half of the communities that had intercity bus service in 1982 had service by the year 2000, and many of these were in rural areas.
When bus companies were not required to cross subsidize low-revenue routes with high-revenue routes, they reduced service to many rural communities. This is an important lesson for Canada if we are considering relying on the market to deliver services to areas that are not economically viable. We need to ask ourselves: Who will subsidize or deliver services under such conditions to rural Canada?
Transportation in the U.S. is also affected by the fact that funding comes from several different sources. This results in artificial boundaries being created, whereby rural transit ends at the county line. This does not help rural residents trying to travel within and across regions, and is particularly serious for those travelling to access health services. The lesson for us is not to create artificial borders. They do not serve rural communities particularly well.
[Translation]
As a closing comment, the American experience shows the importance of public transportation for people with low income or no income at all.
If the public transportation system is inadequate, it may become very difficult to find or keep a job. It there is no such system, these individuals and their families may be deprived of the ability to work.
Although the Rural Secretariat has no data about the income of public transportation users in rural regions of Canada, in devising solutions, it is necessary to take into account the need for low-income people to meet their own economic needs.
[English]
Transportation is an integral part of the lives of rural Canadians, their health, employment and sustainability. The policies and programs that the federal government devises will affect the outcomes that are possible for communities and their growth. This highlights the necessity to strengthen the cross-government coordination regarding rural affairs to address the concerns of rural communities.
[Translation]
The Rural Secretariat is developing a national framework on rural policies, which will facilitate co-ordination between the senior levels of government. In a long term, this will become a tool for supporting communities in their efforts to overcome structural obstacles and help them adapt to the difficulties they face.
[English]
The Chairman: Thank you, Ms Mitchell, for an interesting and realistic presentation.
How important is it to have public transportation services available to rural residents in an era of higher private- automobile ownership?
Ms Mitchell: I would say that the experience in the UK, with approximately one sixth of the population rural and not owning automobiles, and their observation that those tended to be people who simply could not afford to own a car, meant that there are few options for those people. Therefore, some sort of mechanism to lead a normal life of grocery shopping, visiting with family and accessing services becomes more important.
We have noticed in our examination of out-migration that the young people who are affected by the lack of ability to get around their community and to access cultural and educational opportunities in their hometowns are the ones who move. Some of that movement, it could be argued, is natural; young people want to leave home and have a greater and broader experience.
There tends to be in-migration of family-aged adults, then you see an out-migration again beyond 65 and into 70. One could speculate, and I do not know that we can prove it, but once again it becomes the difficulty of being part of a community that does not have services that allow people to move around easily.
The Chairman: What do you think might be the cause of the long-term decline in intercity bus ridership?
[Translation]
Mr. Christian Fortin, Manager, Rural Lens, Rural Secretariat: For some 30 years now, there has been a steady decline in the population of various rural regions of this country. This decrease in population has had an impact on the use of public transportation services. There has also been an increase in the use or ownership of cars, which also has some impact on the use of public transportation. So one influences the other. This has been seen in Canada and in other industrialized countries.
The other aspect is that some people do not necessarily have access to a car. They must use public transportation or limit their travels. The more rural communities lose people, the harder it is to find solutions to the lack of public transportation. We wanted to highlight these situations. In fact, there's a direct link between the declining population in a region, and the use and frequency of public transportation.
We need to look at the role of public transportation in maintaining the standard of living of these communities.
[English]
The Chairman: Ms Mitchell, you said you could provide us access to the rural voice. Can you suggest ways we could get the views of the rural sector in regard to their transportation needs?
Ms Mitchell: We hold planned meetings in the community on an ongoing basis. We call those rural dialogues. The subject matter can often be directed to current issues. With respect to some of the dialogues, the communities themselves identify what issues they want to discuss in depth. In other cases, we bring a suggestion to them and have the workshops operate around that. We could certainly do some exploration around the rural dialogues.
In addition, we invite elected representatives and would be happy to ensure that, when dialogues are occurring, members of the committee, and other senators, could be invited to observe.
The Chairman: We would appreciate observing the situation because we want to direct our questions to the users. We have met a lot of people, but we want to meet the users and know from them how they feel about it.
Senator Oliver: Your report is excellent because you gave us many statistics and much information that can certainly go into our report. I thank you for that. For instance, the OECD indicating that 31 per cent of Canadians live in rural areas. That is very helpful statistic. The fact that any place with a population of less than 10,000 indicates a rural community means that there are certainly a lot of us in that category. I was interested that you said North Hatley is a rural area. There are many people living in that range.
Canada is huge and geographically challenging. There are a number of remote communities, including many in the Far North, that do not have regular access by roads or rivers, et cetera. If we were to try to design a transportation program for those who are disabled, for the elderly, for children, et cetera, I cannot imagine how we could possibly have one national program for all.
Are you of the same mind? If so, what type of approach would you recommend this committee take to deal with the geographical differences that exist in Canada?
Ms Mitchell: It is amazing to realize that Canada is the most rural of the OECD countries. We do not always see ourselves that way. It is a huge challenge. The more we speak with rural Canadians, the more we get the impression that the heart of the solution probably lies with their capacity and their will to make their communities a better place to live. I am not sure that the solutions can emanate from bureaucratic offices in Ottawa or in the provinces. Rural Canadians need to look at their own situations. They need to see what their community assets are and whether a will and a capacity exists. They must identify to us, as government representatives, what we can do to support the solutions they find.
We have just returned from our second national rural conference in Charlottetown, P.E.I., from April 4 to 6. There has been a major change in rural Canadians since the Magog conference two years ago. There, people were rather cynical and said, ``So what is government going to do for us?'' This year, they were amazed to hear from each other good solutions and good, practical ways of revitalizing their communities. They took on their challenge and now look to government not as the ones who would fix it, but as the ones who would facilitate them in the solutions they find.
That is very compatible with the bottom-up approach that the Rural Secretariat and Secretary of State Mitchell have taken. If we can formulate policies that will assist in supporting, then we can allow different solutions to be applied from the bottom up and we can facilitate that.
Senator Oliver: You told us about the pilot project on rural transportation, the Antigonish project, and you said that it was a failure, that it could not be made viable. What lessons did you learn from that?
Ms Mitchell: We learned that although the community had a desire and some services and options available to it, and was willing to try, pretty much on a volunteer basis, to pull together a project, when the plan was put into practice it did not meet the needs they thought it would meet or get the kind of financial support they needed, even though there was ridership. Therefore, it became nonviable. However, from that we learned that had we listened to that kind of advice and implemented a national policy costing millions of dollars, it would not have worked. If a small, locally based project, supported by people who really want it, does not work, at least we have learned that a national policy on the same premise would probably be doomed to failure.
Senator Oliver: Let us assume there was a bus service going in there. What is the best way to ensure that the fares the bus company would charge would be fair while ensuring a viable business, or should the state subsidize? Do we need subsidization in order to ensure that projects, such as that one that failed when people tried to devise their own scheme based upon their own contributions, succeed? They are still entitled to a transportation system.
Ms Mitchell: Yes. The long-term perspective might be different from the short-term one. Those are the kinds of questions that this committee and other policy makers need to consider.
Perhaps there is a need for subsidy for a service to get to a particular level as the economy of a particular community grows. At the same conference, we were talking to communities about how to retain and attract people to them. However, having people come to your community alone is not enough. There must be an economic base that can be grown, a quality of life, a cultural life and educational opportunities available.
When you look only at the one type of transportation it is hard to see whether a particular application will work. If you take the long-term view around all of those in trying to ensure that the community has the tools and growing capacity to take all of those into account, then transportation, because of other things that are happening, may reach that level of viability.
Senator Oliver: You introduced us to the white paper on rural transportation from England. Could you give us the Web site for that or tell us where we could get a copy of that very important report?
Ms Mitchell: Yes, we can get that to you.
Senator Oliver: You also told us about the U.S. report concerning transportation issues in rural America for the 21st Century. Was that report put out in the last 12 months?
Ms Mitchell: The U.S. report came out in the winter of 2002. It is very current.
Senator Oliver: And the English report?
Ms Mitchell: They put their initiative in place in the year 2000, so it would have been since 2000.
Senator Oliver: Will you advise our research people as to where they can access those two reports, please.
Ms Mitchell: Absolutely.
Senator Callbeck: You spoke about the conferences and said that the people who participated stressed the importance of rural transportation. You have talked a lot about that in your brief. You mentioned the two projects that failed, to which Senator Oliver referred. You said that the need was there but that the projects were not viable.
Have you given any thought as to whether governments should be subsidizing?
Ms Mitchell: Our focus has been on recognizing that certain communities in the heartland and in northern and remote areas probably have a number of elements that are not sustainable without public support. I speculate that there are places in Canada where there is that need that on their own will not be able to find a supply of transportation unless it is treated as a public good, and therefore subsidized.
Senator Callbeck: Is that the case in the two projects to which you referred?
Ms Mitchell: I would not want to say today that those are areas that one would necessarily choose. There was a need described there. As to whether they are the most needy, due diligence would have to be done to learn what options Canada would have.
Senator Callbeck: With regard to the white paper in England, you mentioned the proposals made in it. They included promoting car pools, taxis and mini vans. You said that there are no statistics on that yet. How long has this proposal been in effect?
Ms Mitchell: The U.K. proposal was put through in 2000, so it is still relatively new. There is ongoing implementation of it. We cannot access any results yet. There probably is not a published evaluation at this point as to whether it actually worked. Those were certainly the proposals of what they thought could become part of their solutions.
Senator Callbeck: If government were to deregulate, are there a number of places where the private sector would step in and provide minivans or some other type of transportation, in your opinion?
Ms Mitchell: That is not something I could substantiate with the work that we do.
Senator Forrestall: If I may ask a couple of questions for clarification. How much funding do you get annually and where do you get it?
Ms Mitchell: We are part of the federal government; we are part of Agriculture Canada. We are funded through Agriculture Canada and through the Canadian Rural Partnership, which was a specific program, at $20 million for four years. It has subsequently been renewed for this fiscal year at $11 million.
Senator Forrestall: What are you going to do for us for $31 million?
Ms Mitchell: I would have to say that $20 million of that amount is spent. This year, we will work with other federal departments to try to ensure that they understand the challenge that rural Canadians have; that as they provide new policies, new programs and new services, they take rural Canada into account.
I will give you a concrete example. Two years ago the Treasury Board Canada put in place Service Canada to provide access to government services for all Canadians. They did that on a pilot project basis. In the last budget, the funding for this forthcoming year was cut. In cutting that service, we observed that the proposal was that if you had a centre that had high-volume traffic you would be able to maintain that centre.
We said to the people making those decisions that it would probably result in an inordinate hit on rural Canada because there are fewer people in rural Canada and they are more widely distributed. We told them that rural Canada would be harmed, more rural Canadian offices that support our services will be closed. In fact, that was the proposal.
If there are two centres in Toronto, to access a centre you can get on the subway and go in any direction for the same cost and distance. A rural Canadian does not have that option.
We were able to influence that decision, and we now have 122 of the approximately 280 centres that will come out of the decisions that were made in the reorganization of delivery of service to Canadians. We have 40 per cent of the services across Canada in rural Canada and at least 30 per cent in each province. That way we were able to influence what happens to rural Canada by the decisions that are made in good faith.
There are the rural dialogues, talking to Canadians in rural Canada, and letting them understand that they have a voice and that it matters when programs are put together.
We have rural teams across Canada in each province that work with their provincial counterparts and federal departments, and we are speaking in many cases of 15 to 30 departments, all of whom effect delivery in any given province. We want to be sure that they coordinate their activities, understand what goes on in rural Canada, and can optimize what the federal government produces on behalf of rural Canadians.
That is the work that we will do. It is coordination. We have a pilot program or rural development initiative, but it is a small part. It lets our people go to the table and lever other monies from the private sector and other government departments so that communities can propose and invent solutions at the local level, such as the ones I spoke about that took place on the transportation side. That is what we do for the money that we get.
Senator Forrestall: With all due respect, I was born on a farm, and I live in a place called Musquodoboit Harbour, a blossoming urban centre 50 kilometres east of Halifax. I have never heard of you. We do not have any real problems in the pleasant area in which I live, for which I am grateful.
We have specific and very real problems the minister has asked us to deal with on the question of transportation, a major part of which is accessibility and availability. You mentioned the possibility, and obviously there has been some discussion or there are some examples — if there are, I would appreciate you letting us know about them — of shifting to local governments. First, what would you describe as local government, provincial or municipal?
Ms Mitchell: It would be local governments at the municipal level and with citizen involvement. The U.K. and U.S. examples talked about local governments. Our work is often through rural development agencies on the ground that are there working everyday with people to mobilize community assets, ensure that people know how to get together and make communal decisions, understand what kind of issues are important to everyone — and they can be quite effective in understanding what is really important to that community and ensuring that there is support for the projects that are brought forward.
Senator Forrestall: When you referred to diverting fuel taxes, were you suggesting half of it? That is what I interpreted you to say: Take it out of one hand and put it in another.
Ms Mitchell: It is not our policy to say that the government should fund in certain ways, through fuel taxes or otherwise. I could not give you an opinion on that.
Senator Forrestall: That is fair enough. Good luck with your work. I think we should have waited until you were finished and then called you. I am sure you will have a great number of ideas for us then.
Senator Gustafson: You may find my comments too fiercely rural, but that is where I come from.
According to the last report I received from Statistics Canada, we are the most urbanized country in the world. The fisheries, the lumber, the resources, the gas and oil, the agriculture, grains and oilseeds, potash and mining, all come out of rural Canada. Has anyone ever considered leaving some of that wealth there instead of dragging it into a central situation and then using a very expensive method of finding a way to redevelop rural Canada? If we discovered the art of that process, we would have the question answered. There would be adequate funds for transportation, roads, et cetera, and the fuel tax that the senator mentioned is a big one. Little of that goes back into road building. Some of the provinces have been fortunate enough to have sufficient income to build good roads, whereas others have not been so lucky. Saskatchewan, for instance, has about as many miles of road as the rest of Canada put together. It is an impossible task to hold the provincial government responsible for that kind of expenditure when the resources are not there. I lay that out for your perusal and to help you report your findings.
On the other hand, many of our rural areas have not had bus service for 20 years. In other areas, there was service because the bus was going through from Saskatoon to Regina, for example, and it would pick up anyone along the way. If you were off the mainline, however, you were out of luck. Certainly, if something positive could be done in that area, it would be beneficial.
Ms Mitchell: Thank you for the enthusiasm about rural Canada; it is helpful. We have done a fair amount of research recently to try to have not only rural Canadians but also urban Canadians understand how interrelated our economies are. Yes, you are right, senator, 24 per cent of Canada's GDP actually comes out of rural Canada, and 40 per cent of our trade comes out of rural Canada. When we look at that richness and wealth creation, we look on the other hand at the fact that jobs are not commensurately growing with the value of the GDP that comes out of rural Canada. Rural Canada continues to contribute to the economy, but it is not receiving its benefit from growth in jobs. If you do not have that personal economic base, then it is difficult to see that people will stay in rural Canada.
The economy of rural Canada is resource-based and that will not leave our economy for a long time. It is still strategically important to Canada. We are looking to find ways to help communities understand whether they have ways of dealing with bringing jobs back into rural Canada around the resource-based industries and into the new knowledge-based economy. If they work at the margins of those and continue to contribute to the innovativeness of the resource-based industries, there may be room for growth.
If our farming communities, for example, move into higher value production or into niche markets in Canada through the agricultural policy framework that is able to situate itself differently, then the community around the agricultural economy will be better off and there will be more jobs — there will be at least a commensurate number of jobs. Those are the kinds of issues we are trying to understand through research.
Senator Gustafson: When I was first elected, I, single-handedly — although some would question that — saved the railroad, but I should not have, for political reasons. At a meeting of farmers, the grain companies said that if the railroad continues they would keep the grain elevators. The elevator companies said that if the railroads stayed, they would keep the elevators. I remember we were giving speeches and Mr. Ralph Goodale was there. I think I defeated him on the basis of that meeting, but the whole outcome was such that if the people did not support the town, it would be gone. Well, that town went.
That is the importance of the point you make, Ms Mitchell. There are certain communities that will build if they have the vision. There has to be a joint vision of government, of industry and of the community. I welcome your suggestion in that regard for the various communities.
The Chairman: Thank you, Ms Mitchell and Mr. Fortin. We have appreciated discussing these matters with you today.
[Translation]
Welcome, Mr. Maheux. You are the Vice-President of Autobus Maheux. You have distributed your text, and we look forward to hearing from you. You have the floor.
Mr. Pierre Maheux, Vice-President, Autobus Maheux: Since my two colleagues and I are from a remote rural region, we took care to highlight on the map the Abitibi-Témiscamingue region, where our company is located, and the communities it serves in Val-d'Or and Rouyn-Noranda, compared to services on the Ontario side, North Bay, New Liskeard, Kirkland Lake and Timmins.
The red lines show our intercity transportation services. The blue squares are the places where we have service centres. The dotted lines, show the other carriers with which we work. The map is not drawn to scale. We are on a direct line from Montreal, Toronto and Saguenay-Lac-Saint-Jean, up to Chibougamau.
You have been given a folder which contains a promotional brochure that gives you some idea about our services, vehicles and facilities. It also contains the text of my remarks today. You will find the schedules of our intercity transportation routes, and a map identical to the one we have here.
I attended your committee's hearings in Montreal. There were some questions about fares. I decided to attach a list of some fares in order to compare the cost per kilometre of this type of intercity service in the country.
We are pleased to tell you that the fact that we serve a region, deal with our clients, experience with them various serious problems, and take into account the profitability dilemma, enables us to have some knowledge about the situation. This is not a comprehensive brief, but rather some speaking notes. In the weeks ahead, we may have an opportunity to present a full brief to complete our presentation and answer your questions.
In 1958, our company got the first school bus in Saint-Rose-de-Poulariès, a little village north of Rouyn-Noranda. In the 1960s, the father and son developed the company by adding a few school buses. In 1976 and in 1979, my brother Roger and his wife invested in the company and developed a fleet in the La Sarre area. In the 1980s, my brother Marc- André and I joined Roger in expanding to Rouyn-Noranda, and the following year, to Val-d'Or. In 1991, we got an urban transportation contract in Rouyn-Noranda.
One of the incidents that affected us was a major fire at the garage in La Sarre. Over the years, we have made some purchases, particularly school buses, with charter licenses.
We have also done some mining transportation. This involves transportation for the employees of mining companies between the mines site and the neighbouring residences. Over the years, the new generation has joined the company, Roger's children, Sylvie and Dominique.
In 1992, the Transport Commission gave us some additional service points. We already had charter licenses for the main cities in the region. In 1992, we got some service points including most of the communities in the Abitibi- Témiscamingue region.
In 1994, we got the Abitibi-Témiscamingue intercity network from the Quebec Transport Commission. This network belonged formerly to the Voyageur company.
We have office and garage facilities in La Sarre, Rouyn-Noranda and Val-d'Or. We also have a family garage in Sainte-Rose-de-Poulariès. We also have another garage for our fleet of school buses in Malartic. We have two terminals for our fleet, one in Rouyn-Noranda, and one in Val-d'Or. The promotional brochure contains some photos of the terminal in Rouyn-Noranda. These are paratransit terminals.
In 1996-1997, when the office for disabled persons did a study on the accessibility of terminals, there were four accessible terminals in Quebec, two of which were in Abitibi.
Over the years, we have continued to invest to improve infrastructures and buildings, to buy new vehicles, to get new terminals, new garages and more functional, efficient offices.
We support the community. Every year, we get thousands of requests, and the Maheux family supports hundreds of organizations at a cost of some $20,000 a year, either in cash or services. Our staff is involved and dedicated: most of our directors, assistants, dispatchers and foremen have been with us for 15 or 20 years.
Volunteer work is one of the characteristics of the managers of the company of which I am part. At the beginning of the 1980s, my brother Roger chaired the Quebec Bus Owners Association; my brother Marc-André is currently a member of the finance committee of this association, the QBOA, and I have been a director of the QBOA since 1985, that is 17 years. I was the President for two years. Since that time I have been in charge of the fate of the school transportation at the QBOA, and I am still the Vice-President of the QBOA.
I am also a member of the Foundation of the University of Abitibi-Témiscamingue and a member of the audit committee of a caisse populaire. I volunteer with a minor hockey team. I am also a member of dozens of organizations and honourary president of the Rouyn-Noranda Wine and Regional Food Fair. I would like to invite you to come to this event on May 3 and 4 in Rouyn-Noranda.
At the moment, Autobus Maheux has about 200 employees. We have 135 vehicles, six workshops and warehouses, three office sites, two terminals, and close to 30 agencies exclusive to our network. We provide school transportation for four school boards, and therefore for dozens of directors, some 50 elected officials, about 100 school principals and for thousands of school children every day.
We provide local and regional transportation services on school buses, chartered transportation in buses, which is by far the area or the market that has developed the most in recent years or that is the most used. Of course, these charters include all types of sports, cultural and other groups. Our charter services are used by our Aboriginal clients that we value particularly.
You cannot see it on the map, but the Amos-Matagami route goes as far as Radisson-James Bay and the Hydro- Québec project there.
We have been providing urban transportation services within Rouyn-Noranda for 22 years, and since 1991, we have a subcontract with the city. We operate two vehicles. It is a small fleet, but we transport some 80,000 passengers a year. Intercity transportation alone accounts for half of our activities, which were the subject of quite a process in Abitibi- Témiscamingue in 1993-1994. In two months of public hearings, we made the headlines almost every evening, and in the end, Autobus Maheux got a licence. The cornerstone of the debate and the main argument put forward by the regional development board, which you heard from in Montreal last February, was specifically the issue of cross- subsidization.
The existing carrier had been authorized to keep the main route and get rid of the routes that were not cost-effective. However, he did not meet the deadlines, and lost the licence. The commission held hearings to award these licences, and we got them, with a commitment and obligation to operate a number of unprofitable regional routes with financial support from the main Abitibi-Montreal route. The main route is therefore Rouyn-Noranda-Val-d'Or and from the Laurentians to Montreal. We have six departures every day, three in one direction, and three in the other. This is the main route, which serves some 50,000 passengers a year.
We operate this main route with permission to operate the following routes shown on the list: Rouyn-Noranda, La Sarre (in one direction in the morning and in the other in the evening); Rouyn-Noranda-Témiscamingue-North Bay, the entire Témiscamingue region, from the centre of Ville-Marie to North Bay, with transfers to Guelph and Ontario- Hartland, which serves the entire northern regions; the round trip Val-d'Or-Amos route and the round trip Val-d'Or- Matagami route; Val-d'Or-Rouyn-Noranda, a local service every day; Amos-Rivière-Héva, with fairly numerous transfers to other vehicles; and Val-d'Or-Chibougamau, which is a transfer with Intercar that bought the Chibougamau-Saint-Phillisien route. We have connections with this company.
To our knowledge, Autobus Maheux is the only bus company in Canada with intercity licences, with conditional links between them. In other words, cross-subsidization is mandatory as regards the Quebec Transportation Commission. We cannot intervene, interrupt or change anything without calling into question other licences. Other companies do cross-subsidization as well.
With the authorization of the Quebec Transport Commission, two regional routes have recently been abandoned: in 2000, Rouyn-Noranda-Kirkland Lake, which made it possible to avoid going to North Bay before heading north again, because it was not very busy, and also the La Sarre-Amos route. On the map, this route is shown in blue, because there has been no service there since last year. We received authorization from the Transport Commission to stop the service in 2000, but since we have trouble discontinuing service to our customers, it took us a year to actually end this service.
In order to operate this network, Autobus Maheux has a staff of 27 drivers, with 14 buses, and offers at least 24 departures every day of the week. Two drivers are assigned permanently to the Montreal route alone, and more are added during the Christmas holidays and in the summer.
Like all intercity carriers in Quebec, we offer discounts to many of our customers. The reductions may be as much as 25, 30 or 50 per cent. We also have an agreement with the office of disabled persons under which escorts required by disabled people, travel free of charge.
We are among the pioneers who established an accessible bus system. In Abitibi or Montreal, people can reserve travel on a bus equipped with an elevator. In view of the distance, this service is not used by the disabled a great deal, but we have the equipment, and we meet the demand.
In addition, for children between 8 and 11 years of age, we have established a procedure to make parents feel secure. We offer other special products, including tourist passes known as Route-Pass, which allow national and international tourists to travel as much as they want for a set price. Nationally, Autobus Maheux has also introduced an ``Econopass'' to allow students, particularly Cegep students, in the Abitibi-Témiscamingue region to travel throughout the region at a 50 per cent discount. ``Subscription'' transportation, as it is called in Quebec, includes all transportation services not covered in other licences, that is mining transportation, private contract transportation, which has been mainly for mining companies.
At the moment, we have two services on these licences: one with a drilling company in which we provide transportation every two weeks for drillers from Val-d'Or to Red Lake, in northeastern Ontario, close to the Manitoba border. The other service is with a federal organization and it is for transporting adult Aboriginals from two communities to adult training programs in Val-d'Or and Amos.
In our view, it is simplistic and inadequate to look at the issue of bus transportation merely with respect to whether or not regulations are required. We have to remember why the regulations were introduced, and why they should be retained or abandoned. If the government is wondering about whether or not it should maintain a regulatory structure for the economic activity of transportation services, we are obliged to conclude that there is a political will to improve the situation in this area. I think that because of this will, the minister gave you the responsibility to investigate the situation and to correct any problems there may be. We assume that such an important study is not merely a consultation exercise to find somewhere a reason to deregulate, either because it is fashionable or because of some trend toward liberalism or because it is being done in the trucking and in the aviation sectors, or, worse still, because it has been done elsewhere. If there are good reasons showing it is preferable to deregulate, then let us deregulate. Otherwise, let us keep the regulations.
As far as air services go, one thing is certain: the experience in that industry has been so catastrophic, particularly for the regions, that it is unthinkable that it could serve as an example for the bus industry. The challenge is to identify the problem or to identify among the problems the one that must be solved first, for the greater benefit of the population. If any minister invites us to reflect on a particular matter, he or she does so in an effort to solve the problem. If the government says that it must intervene and that the industry is in decline — which we might think from the background documents — because it has noticed a problem and a number of people have complained about it, then things become clearer. We might think that we would finally find out what the problem is. However, has the company experiencing difficulties been heard? Does it exist? In addition, does the industry have one association, more than another, that is calling for and justifying deregulation?
When I attended some of your hearings in Montreal, the four Canadian associations did not say whether regulation was good or bad. They particularly did not say that it should cease to exist. They mentioned certain problems. If it is not clear whether we are deregulating for its own sake, or whether there are some problems, we might wonder what the real issue is. Our associations raise problems and suggest solutions. Since I am involved in one of these associations, I can confirm that Autobus Maheux supports the efforts of our associations. We very much hope that the committee will take into account the comments and recommendations made by the associations.
This brings me to the issue of paradoxes. As regards our area and our company and our population in particular, it is clear that without ``cross-subsidization'' as a result of regulation or without possible direct funding, a number of regions or communities and there population would have no service, no mobility, or else a reduction of service and mobility.
However, what is even clearer, is that in similar regional situations, some individuals have access to an intercity transportation service or even to an assistance program that could be used to organize such a service, whereas other individuals have no such access. Some residents do not even have to ask themselves whether they need a service, they have it in any case, thanks to a public organization that provides intercity service. Other citizens, on the other hand, in a similar context, do not even have a door on which to knock to request such a service. Our problem is one involving the principle of mobility of Canadian citizens. That is why we talk about paradoxes. This organizational and structural contradiction makes it impossible for Canadians to receive fair treatment. In our view, this is a real problem that the Senate committee and the minister should be reviewing: unfair access to regional transportation services for the people of Canada.
By definition, we can state that transporting people is a public service. For many people, it is even an essential service. As far as intercity bus transportation goes, this essential service is often provided by the private sector, and its only criterion is profitability.
We, ``private carriers of the public'' are paradoxically but particularly well placed to know about our customers' essential transportation needs, their isolation, their travel habits and their fear that in the future they will not be able to travel. At the same time, we know about situations in which people can lose a service because it is not profitable or because of a political decision. We regional carriers are business people, who are theoretically skillful, who want their company to prosper, to generate good salaries, good revenues and good returns for the owners. At the same time, we are people who live in this region. We use our own services. We know most of our customers: they are our uncles, friends, customers or someone we know from hockey. We are also part of this population. We are a paradox, because we are torn between the fact that we believe in private enterprise, which is the most efficient way of providing a service, even a public service, but the public is entitled to service in regions, even when they are far from the major centres.
It is difficult to understand that in such a wonderful, highly regarded country throughout the world, we would have two or even three classes of citizens in terms of access to mobility. It may be true that some countries have taken a stand in favour of mobility, but that has not been verified. I am referring to some European countries, particularly the Nordic countries, which have opted for mobility, and have made it unacceptable or even illegal for people not to have access to transportation services. In Canada, we are nowhere near this standard.
I am inclined to make a comparison with health and education. We can be proud of our health care system in Canada. However, it is experiencing some upheavals, and there is apparently a shortage of money. The system requires a great deal of money. The cost of health care services and the long-waiting times have caused some individuals to suggest the use of private services. Despite a hypothetical privatization of health care, few are ready to abandon the principle of universality. And quite rightly.
What can be said then about universality access to health care? People living in a region, in villages, must find a friend, cousin, uncle or brother to drive them to the closest health care centre or to the airport to take a plane to get specialized care in Montreal.
So what about the universality access of Canadians to travel throughout the country? What does the Senate committee think about this issue and indeed what is the position of the minister? These are issues that I want to raise. They are important ones. The answers to the issues that I want to raise here might be completely different. We could be talking about a regional solution or one that is based on the needs of the majority.
The same issue arises in the area of education. In Canada, education is compulsory and steps are taken to ensure that education is available throughout the country. In Quebec, which is a province that we perhaps know a bit more about, each school board is responsible for providing transportation for students in order to enable them to access this compulsory education. Student transportation however, is not a legal requirement. Nevertheless, school boards or schools, even private ones, would be very hard pressed to hamper the access of students to education by cutting off transportation services. The various bodies choose to provide transportation. However, there are shortcomings. Many young students, 16 and 17 years old, have no access to a school bus service.
I think that we all agree that providing a public transportation service costs money. Is the federal government prepared to put money into the system to address disparities? Quite apart from the investment issue, we think that the government should at least ask itself the following question: ``How come in Canada, where transportation policy is a jurisdiction shared with the provinces, there are regions of the country where people do not have access to a basic assistance program for the provision of public transportation services? How is it possible that the ability of people to travel around varies from one region to another? How can we explain the fact that intercity transportation in Canada is now run in one of the following two ways. First, in some provinces, intercity transportation services are provided by the private sector, which receives no financial assistance. Second, within the same province, transportation services are either provided by the private sector with no cross-subsidization or financial assistance or the service is operated by the private sector with cross-subsidization but without financial assistance. In some cases the intercity service is provided by a crown corporation, with financial assistance but which is in fact operated by the private sector.
In other provinces, intercity services are either operated by the private sector, without funding or cross- subsidization, or it is provided and operated by a crown corporation. In several Canadian provinces, intercity services are no longer available because of a lack of funding programs or in some cases, because of a lack of customers.
It was the railway which enabled all the various regions to come together to form the country of Canada. The railway was a driving force for the economic and technological development of Canada at the time because it enabled both people and goods to be moved around. At that time there was a goal, a philosophy and a mindset.
Today, there are many different ways of moving around, but one thing remains however, the need to travel. Modes of travel have developed significantly because Canadians rely significantly on their ability to move around in safety and comfort. Travel in Canada is more important than it has ever been. On the issue of people's mobility, do we in Canada today have a reliable equalization system or do we have a majority based approach? While major efforts are being made to convince people that the deregulation of the airline industry is a success story, there is little competition in this industry and the price of airplane tickets have now reached outrageous levels. People living in Abitibi-Témiscamingue have to pay between $600 and $1,000 just to go to work or to get health care. An airline ticket between Abitibi and Montreal would set you back $600 and a ticket for Quebec City costs $1,000.
We referred earlier to the transcontinental railway. This is the very symbol that united all the various regions of Canada. When Canada was in its infancy, cities were poor, there were major problems, people living in the cities faced hardship, and the railway was used to settle the country and to provide people, quite literally, with land and at the time people were told to settle in Canada and that public services would be provided.
There was a mass movement of people. When the situation in the major urban centres is good what is the predominating concern? Who cares about the regions? It is in the regions that the minority of people live today. This minority was born and bred in the various regions. They like living where they do and they are entirely aware that all the metals, wood, agricultural products as well as all their natural resources are exported to the major urban centres. It goes without saying that in terms of regional GDP, they do not get their fair share of public services.
We have seen increasingly sophisticated modes of transportation being developed. However, the transcontinental railway which passed through the Abitibi region, through such cities as Senneterre, Amos, Tachereau, LaSarre and Dupuis on its way to western Canada, has gone the way of the dodo. Intercity bus services have also been significantly cut.
In the region of LaSarre and Amos there are approximately 30 communities with a population of approximately 30,000 respectively. A hundred and forty-five thousand people live in our region but the access to transportation services is not at all in sync with this level of population.
What steps should Canada take in the area of intercity transportation services? The first proposal that we would make would be for the Canadian government to commit and to take the necessary steps to ensure that Canadians are able to travel around the country. In order to do this, the government must assert this commitment and give the regions the necessary responsibilities and tools to enable them to provide transportation services. This is a heartfelt plea that I am making to you today.
Canada must adopt this approach. If this meant that the Canadian government had to deregulate, then, so be it. However, this approach would mean that only the majority of Canadians would have access to public transportation. This is the exact opposite of how people in the regions view Canada. They see the Canadian way as an equalization- based system geared to serving minorities.
Deregulation would be somewhat tantamount to leaving the regions out in the cold. If the Canadian government chooses to deregulate, this policy can only fit into the Canadian way of doing things if the government were to also implement immediate straightforward measures to ensure that all Canadians continue to have access to or regain public transportation services. We are quite willing to play our role in providing this service.
I would be pleased to answer any questions you may have.
The Chair: Thank you, Mr. Maheux. Under a regulation-based system, how could we provide services in those regions where there are currently none?
Mr. Maheux: To be able to answer your question we would need to determine whether there would be enough people to warrant a public transportation service. We could not use a 45 or 56 seater bus in an area without a public transportation system or where there would be no one to use the service. There is no magic figure here. We had to cut our Rouyn-Noranda to Kirkland Lake service, because we were operating at a loss since we only had an average of fewer than two passengers a day. We also cut our LaSarre to Amos service last year. Here also, we were carrying an average of 2.1 passengers a day.
We have approximately the same average number of passengers on our Matagami daily service. Approximately 3 passengers use that service every day. The entire network of routes that we operate must be profitable for us. However, this entails some sacrifices. We find it is difficult to cancel one particular route. However, the way we see it, it would be quite a ridiculous state of affairs if we were to operate routes with very few passengers — but nevertheless a route that people relied on — if an Ontario crown corporation was providing a parallel service at great cost to the province of Ontario. The same thing goes for the province of Saskatchewan. The in-province intercity bus service is operated by the province itself.
I am perhaps a bit off topic here but I come back to your question. How can we provide service in areas where there is none? Firstly, there must be people in these areas who require a public transportation system and also people willing to provide it.
When she came through Montreal, Ms Mitchell, from Rural Solidarity, pointed out, and rightly so, that peoples' mobility does not necessarily depend only on bus service.
I am not defending my own turf when I am saying that, but it is a fact nonetheless. She mentioned something else that affects our daily lives. Despite the lack of service, it is quite true that in some areas, paratransit will offer on-call services, in other words a taxi will be provided for in the health services transportation budget and a school bus will go by.
In other words, it is not that there is not enough money going around but the money is not targeted. The taxi service could ensure minimal service in a given area even though it is only for a dozen people.
On the other hand, if those people do not have the means to pay for a taxi, what is the solution? What is the solution when you are talking about a 50-kilometre taxi trip? It is something like the example of the public bus systems. In the document, I mentioned another example in Quebec. The users who want to go into Montreal and who live in Joliette or in the parishes around there, have to use intercity services. They go from one town to another to get to work. This is a private sector operation, but it exists within an aid program. It is the same aid program that allows the City of Rouyn- Noranda to provide public transportation while operating on a private basis. The municipalities, in this program, must have the service provided by the private sector.
There are situations, aberrations, which mean that unidentified municipalities — on the blue line here — like Taschereau and many other towns do not have any service anymore. We are talking about municipalities of 2,000 inhabitants and the others are smaller.
In outlying areas, the difference between operating a line to be self-sufficient or helping it so it can at least meet its costs is never a matter of millions of dollars. All provincial governments have programs to support public transportation especially in urban areas. It would cost a few million dollars to support networks in outlying areas.
The Chair: Would you agree that if you have abandoned or dropped certain routes, others could try to provide service on them? Would you object to someone else making an application to provide new services?
Mr. Maheux: Even if we drop a route, we still would have preferred to carry on with the service. We have to look at other solutions. Let us take the example of our Rouyn-Noranda-Kirkland Lake route. There was an Ontario carrier who went between Virginia Town and Kirkland Lake with a school bus type service. That carrier had stopped providing that service for a number of years. When we discontinued our own service, he started his up again. He had to drop it again because we all have the same problem.
To ensure the service, the difference between the income provided by the client base and the operating cost of the vehicles in other categories is not very great.
Something major bothers me when we talk about rural regions, in other words lower-density-population areas. The people who addressed you before me mentioned that rural regions should not constitute an exception. These last years, the rural area population has greatly decreased so there are fewer people using public transportation services. Because they are fewer and slightly isolated, we sometimes get the impression that we can ask them to travel ``any old way.'' I am being careful of what I am saying, but I do not agree with asking people with reduced mobility who have to go to the doctor's and who are advancing in age to sit in a school bus for 35 kilometres. I am quite proud of my school buses, they are very comfortable, but they are still school buses. They can do for a 10-kilometre trip, but for anything more it is not as clear cut. If you do not want services to decrease any further, travellers will have to be offered something more comfortable.
The Chair: Something that surprised us because of its importance is the phenomenon of children travelling alone. This was discussed in Montreal. Do you have the same thing in your area with children, for example, whose father is in Abitibi and whose mother is in Montreal, travelling on their own?
Mr. Maheux: Yes. That is why we developed the identification system for the person dropping off the child and the one picking up that child at the other end. I do not have the statistics for all the towns. I know that in Rouyn-Noranda, during the last year, 232 children travelling alone, in the 8- to 11-year-old group, were supervised. There are probably as many in the 12- to 14-year old category, but I am talking about those for whom we have a form filled out for travelling. So, 232 children just for Rouyn-Noranda. It is probably just about the same for Val-d'Or for the same age groups. The older children still require a bit of attention from the driver. Even if there is no ``unaccompanied child'' form filled out, the younger teenagers will be asked to sit in front of the bus to be closer to the driver.
The Chair: Do you carry parcels? I am told that in some areas carrying parcels can help fund the company and help it provide more services.
Mr. Maheux: Yes, we carry parcels. It is a more than major source of income for us on our intercity network. It is an important percentage of our operations. I shared that with a few carriers. If this matter is raised as being part of the solution to help keep traveller services alive, then that is a problem.
The Chair: It is a point of information.
Mr. Maheux: I know that this matter was raised in the background documents. In our case, it is a touchy matter and I will explain why. In 1987, the Canadian government chose to deregulate transportation of goods in Canada. The government said that it was not concerned with parcels and courier service and that it was deregulating. Today, in a billion dollar market, if bus carriers managed to get a few crumbs — I think that in Quebec it is about 2 per cent of the parcel volume — all the better. But if we have managed to get that parcel service in an area like ours, it is because we managed to outsmart our competitors and get that income for ourselves. You should especially not expect that this kind of income is a solution to support our traveller service. Today, in Abitibi-Témiscamingue — I am going out on a limb here, I especially would not want this to make headlines tomorrow morning in one of our regional weeklies — you could say that income from parcels is big enough to make the difference between dropping some other services or not. That is clear. Parcel delivery is a very competitive area and we are part of it.
[English]
Senator Oliver: You spoke about subsidization and cross-subsidization. You indicated that you are not able to carry on your activities without cross-subsidization and without subsidization. I presume, when you take a run from Waswanipi to Chapais to Chibougamau, that that would not be a paying proposition if it were not for both cross- subsidization and subsidization; is that correct?
[Translation]
Mr. Maheux: I like your question because it will allow me to be more specific. I gave you the example of the Val- d'Or-Chibougamau route. We got it two years after we got the whole network. This route is not part of the agreement saying that we have to operate even if it is in a deficit position. For your information, the Val-d'Or-Chibougamau route, return trip, once a day, is the only so-called regional route besides Montreal. It is the only route in our network that is self-financing. It is profitable, it supports itself. If, in effect, there was no possible cross-subsidizing, we could do nothing other than question-keeping non-performing routes or, at least, part of them, either by decreasing the number of runs or dropping the route completely. That is clear.
You heard Mr. Brunet from the Conseil régional de développement de l'Abitibi-Témiscamingue who, at the meeting where I was present, make a comment about Autobus Maheux and also about a possible deregulation and cancellation of services. He stated: ``Whether regulations are maintained or not, Autobus Maheux are pretty experienced and, when the time comes, they will make whatever decisions are needed to get through.'' He was right. Here is why.
If permits continue being regulated and cross-subsidization remains, we will manage with something similar to what we are doing today. At the end of the day, we require overall profitability. On occasion, this forces us to give up some services on less frequented routes.
If, on the contrary, deregulation does happen Autobus Maheux will not suffer the most; I am not here to tell you that we will be a basket case as a carrier if deregulation happens. If deregulation does happen, we think that there are carriers in the south of the province who will want to run the main line on the Abitibi-Témiscamingue route.
Our answer to that is to ask who is in a better position than we are to compete on that route because we have all the terminals in the rural areas. Maybe instead of travelling to Montreal three times a day, we would only do it twice. Maybe I would operate only one route with two scheduled runs instead of three and I probably would not lose all that many clients because people encourage our regional business. As for the other regional routes, it is not serious. The business can have close ties with the surrounding population — and that is our case — or not have any ties at all but the business will always make those choices that will allow for the best results. It is not the same thing at all for the population.
[English]
Senator Oliver: My final question is about competition. In the summertime, there must be a lot of people wanting to take a charter bus or a tourist bus up through many of these routes. Is there difficulty for other companies to get that charter business to compete with you on these routes in July, August and September?
[Translation]
Mr. Maheux: The Autobus Maheux client base for chartered trips is strictly in Abitibi-Témiscamingue. In other words, we do not follow the lead of our colleagues in the south of the province, Ottawa, Hull, Montreal, Toronto and everywhere else. We do not run a welcoming service for the French, the Spaniards, the Japanese, the Germans and all that. We have a high volume of charter business, but we deal exclusively with people from Abitibi-Témiscamingue who travel outside of our region for a given activity.
As I mentioned in the brief, sports teams, especially junior and major hockey teams call upon our services. The native population, pre-retirement people and seniors going on trips outside our region, trips to sugar shacks and other kinds of trips have increased our customer traffic. We offer destinations like Vancouver, Halifax, New Brunswick, New York or Nashville also but the people taking these trips are all from the Abitibi-Témiscamingue area. We operate three or four buses just for that. The problem is always the same one: one weekend you need eight buses and the next weekend three of your buses remain idle in the yard, and so on.
This brings me to deregulation in the area of charters. The industry in Quebec, the QBOA, made a decision several years ago. We agreed that we could live with deregulation for chartered transportation in rural areas but that this was not an ideal situation. I am a carrier in Rouyn-Noranda and I decided to get a coach. My colleague in Val-d'Or, who has school buses too, decided to get his own coach and the same thing happened with my colleague who has school buses in Amos.
There is surely a matter of critical mass and markets and the population is less well served by three carriers from a single company rather than by one carrier from three different companies. I am not saying you do not need competition to be efficient, on the contrary, because competition keeps us awake, but there is also a question of market size and you need a minimum market. What is marvellous with the deregulation process is that it ensures a certain volume of business to companies which allows them to provide quality service.
Senator LaPierre: Did you tell us that the Val-d'Or-Chibougamau route is a paying proposition?
Mr. Maheux: It is profitable.
Senator LaPierre: You have two profitable routes where you hold a monopoly?
Mr. Maheux: Yes.
Senator LaPierre: You have a monopoly between Val-d'Or and Montreal and because of that monopoly you must serve other less profitable areas. Is that not the case?
Mr. Maheux: That is true, but I would add a little qualification. The Val-d'Or-Chibougamau route turns a profit, but that is it. The Rouyn-Noranda to Montreal route is profitable and subsidizes all the others. The Val-d'Or- Chibougamau route does not subsidize anything else, it just pays its own way.
Senator LaPierre: Private enterprise is supposed to be private enterprise. If the State is concerned with all the possible and potential difficulties of private enterprise, then the State may as well do it itself. I have two questions that really make me impatient. Do you get your permit from the provincial government?
Mr. Maheux: Yes.
Senator LaPierre: So you should be talking to your provincial government, not to us. Should these regional transportation problems not be left to the province of Quebec or the other provinces and not come before the federal government? Why would the federal government get mixed up in this business?
Mr. Maheux: I am happy you ended your question on that note, because in an area like ours, not so long ago, a carrier decided to keep only the profitable route that was subsidizing the others and to let go of those routes operating at a loss because he actually intended to ignore cross-subsidizing and only keep whatever was turning a profit. In an area like ours, when business and the regional development council see that the federal government is questioning regulations that allow us to provide service to our communities, our reaction is to wonder what the federal government could question that might affect us. However, I agree with you, our dealings are with the provincial government. The provincial government delivers the permits and we manage the safety question with that government. But unless I am an ignoramus, the federal government has overall authority over transportation. Transportation comes under the federal government's jurisdiction and it lets the provinces manage the permits and other technical details in each province.
Senator LaPierre: On the other hand, we have an educational system that the federal government pours money into at all levels. It is managed by the provinces and the federal government does not tell the provinces: ``You are going to teach the history of Canada from second grade through to tenth.'' It seems clear to me that we can recommend to the federal government to mind its own business. That the whole matter of intercity transportation comes under provincial jurisdiction and it is up to them to take care of it. The federal government will not deal with it at all unless to set up a national network.
Mr. Maheux: The federal government cannot decide to possibly deregulate and therefore leave it up to free trade to decide that the rural populations will not have any more service simply by saying it is none of its business.
Senator LaPierre: The problem is that it will cost money. If you want the federal government to be part of it, it will have to pay an amount of money to set up a national network. If it sets up such a network, it will have to have agreements with the provincial governments to determine all kinds of things. When you have joint jurisdictions, there is always a fight and those who suffer most are the taxpayers.
Senators do not take the bus. The federal government does not take the bus. We did it to go to Montreal, yes, and that will probably be the only time we have done it in our lives. I am thinking about this seriously and I wonder who should be regulating? Who should have the authority? How do you set up a national network based on provincial authorities? That is the challenge of Confederation and federalism.
It might be interesting for people taking the bus in rural areas to be able to deduct the cost of transportation from their income. In Montreal, you do not need that because you have the subway. How much is a ticket from Val-d'Or to Chibougamau?
Mr. Maheux: Between 40 and 50 dollars.
Senator LaPierre: Someone doing this two or three times a month, say 16 times a year, could deduct that cost from his income. Would that help you?
Mr. Maheux: Certainly, anything that might encourage people to take the bus is interesting.
Senator LaPierre: But in the other hand, you cannot force people: ``You can lead a horse to water, but you cannot make him drink.'' The same thing goes for people who decided they will not use your service.
Mr. Maheux: It is not that the people do not use our service. When you look at an MRC, a rural municipality, like ours in Abitibi-Ouest, with almost 30,000 inhabitants, they use the service. To make it profitable, you need clients. What I find irritating is that people think that because it is a matter of money the federal government should not get mixed up in it. On the other hand, how many millions of dollars were given to VIA Rail to withdraw from Abitibi and who provides a service whose operating costs are not even covered up to 50 per cent by passenger fares?
Senator LaPierre: I have no problem with that.
Mr. Maheux: It is a double standard.
Senator LaPierre: I think that mobility is a fundamental right. It is in the Charter. It is either up to the federal government, the provincial government or the regional government to determine how citizens can be helped to exercise this right. Any time too many people get involved in problems, you have jurisdictional conflicts and the ordinary people suffer.
Mr. Maheux: I agree. If we want to avoid jurisdictional conflicts between the provinces and Canada, the day a decision is made on regulating bus transportation in Canada, a decision will also be made on the quality of services provided to Canada's smaller municipalities. Canada cannot turn a deaf ear to that.
Senator LaPierre: I agree with you.
Senator Biron: Your territory is regulated. Are your tariffs, both for regular service and chartered service also regulated? Are your fares set?
Mr. Maheux: In Quebec, we answer to the Commission des transports du Québec. All bus carriers in Quebec whether intercity or chartered, have to go through the same exercise when they want to change their rates. They have to table their rate structure with the Commission des transports du Québec which has the power to say whether they are sensible or not. If we go too far, we will be told, but usually we follow the cost of living.
Actually, you will find a fare schedule in the kit. I would like to draw your attention to certain elements in this document. You will find examples there. The first is our main route, Rouyn-Noranda-Montreal. The second column gives the fare before taxes as it appears in the directories. The third column sets out the number of kilometres, the distance between the point of origin and destination and in the last column, the most interesting one in my view, gives you the rate per kilometre.
How does the rate per kilometre translate out for a bus passenger? There is an important principle of logic here. If a customer takes the bus to go only 30 kilometres, the price per kilometre will certainly be higher. We have to ask for a minimum fare if only to cover the cost of printing the ticket. When the passenger sets foot in the bus, you already have a four-dollar cost right there and it is regressive. When the distance is long enough, 100 or 200 kilometres, for example, then you start getting comparison points.
Then you have the routes from Winnipeg to Regina, Calgary to Edmonton, Penticton to Vancouver. Let us take the last column. The rates per kilometre increase. For the penultimate one, Rouyn-Noranda-La Sarre, the rate is very high but we are only talking about 87 kilometres. Over a shorter distance, you can be sure the cost will be higher. It only costs $14 to go 90 kilometres. That is not necessarily very expensive, but it certainly is a higher per kilometre rate.
I would like to draw your attention to the last element. The Montreal-New York run has Greyhound and Adirondak competing on it. In the US, bus transportation is deregulated. That has allowed Adirondak to compete on this route. Mr. Jean Blais, an official with the Quebec Department of Transport, has done certain studies that show that in the US bus transportation was deregulated and, except for the fact that some areas and some States lost some services, the price did not actually decrease.
In the US, the price has not decreased despite competition. Today, with $1 million, you cannot even buy two buses because they cost $550,000 each.
That goes to show that competition has not led to a price decrease. Transportation companies try to be competitive in order to increase the number of their passengers. Where operating costs and fares are concerned, we compare favourably to the Canadian network.
Senator Biron: If you have Greyhound and Adirondak competing for the same number of passengers, they are charging 17 cents. Does that break down to 8.5 cents per company since there are two of them?
Mr. Maheux: Yes, the revenue per client is really shared. You are right. Would they have twice as many clients if they were alone on the run? Maybe the price would go down. We are all facing a dilemma. In Abitibi-Témiscamingue, not so long ago, you took the plane and paid quite a bit to go to Quebec City or Montreal. We did not think that the price would increase, but today service has decreased and the price is out of this world.
What do the regulations allow in the air transportation industry? They mean that in the Montreal-Toronto corridor companies can compete with prices as low as $159.95 while the people in Abitibi-Témiscamingue are still paying a $1,000 to go work in Quebec City. It is ridiculous.
The Chair: We have not started looking at the solutions yet.
Mr. Maheux: I understand.
The Chair: The members of the committee much appreciated your presentation and thank you for the answers to their questions.
Senators, our next meeting will be held Wednesday, May 1 at 5:30 p.m. It will be chaired by Senator Oliver because I have to go to France.
The committee adjourned.