Honourable senators, thank you all for your indulgence this evening. I had just finished explaining, at midnight last night, that some of the airport towers had been given a reprieve from NAV CANADA’s closures. But NAV CANADA is still studying significantly reducing its hours for service in other airports, including Sept-Îles, Brandon, Prince Albert, Fort St. John, Dawson Creek, Flin Flon, Dauphin, The Pas, Buffalo Narrows and Sydney, Nova Scotia, although it now says none will face imminent service elimination as they had before.

So you may be asking, Senator Simons, if the problem is largely solved, why are you still bothering us at this late date and this late hour by giving the rest of this speech? Well, I do have an answer — because the underlying structural problems confronting NAV CANADA and Canada’s smaller regional airports have not gone away.

NAV CANADA has raised its fees to air carriers by 29.5%, a huge hike for struggling airlines, even if they are phased in as planned over the next five years. WestJet, for one, is already calling for relief from having to pay those fees as it tries to ride out this storm.

But NAV CANADA is a private company, and it doesn’t take orders from Transport Canada nor from the minister, not when it comes to closing towers or setting fees. Transport Canada’s civil servants can intervene if they feel a reduction of service presents real and substantive safety concerns, but such service reviews are supposed to be resolutely apolitical.

Still, NAV CANADA isn’t quite like a regular private corporation. It’s a federally regulated monopoly which provides an absolutely essential service to Canadians without competition, and its bylaws can only be amended with the consent of Transport Canada.

The NAV CANADA model worked as long as thousands of planes were flying, as long as the fees paid by big international carriers subsidized operations at smaller Canadian airports, but the model has collapsed, and who knows when it may be fully functional again now that the world is grappling with the Delta variant.

Until the pandemic is truly tamed and until people from all around the world are routinely flying in and out of the United States again, we will not be back to anything like normal air traffic through Canadian airspace.

The rules around NAV CANADA’s not-for-profit structure mean it can only charge enough fees to cover its costs. The company cannot bank surpluses for a rainy day and, as a result, when the COVID crisis hit, the company had just $93 million in its rate-stabilization account. The company has gone to the bond market and raised significant funds. It’s now carrying $850 million in debt, but that money will have to be repaid. And what happens next year if planes still aren’t flying at anything like normal numbers?

NAV CANADA was correct to recognize it could not make up revenue shortfalls of between half a billion and a billion dollars by pulling its services from regional airports. Regional airports, in turn, are facing existential financial woes of their own, and they can’t afford to bail out NAV CANADA either. Those airports have dodged this bullet, but other extraordinary economic challenges facing regional airports remain.

The organizational structures that were put in place in 1996 and which worked so well for almost 25 years have had their vulnerabilities exposed. And as senators who are bound to represent our regions, I believe we’ve a duty to recognize this quandary and to think about substantive solutions to sustain NAV CANADA and Canada’s network of regional airports. I hope we will put our minds to this issue when we fly back to this chamber in the fall. Thank you. Hiy hiy.