Farmers and grain shippers hoping for improvements to Canada’s grain transportation rules will likely have to wait at least another 18 months.
And the shape of the new legislation may depend as much on what happens south of the border as within Canada.
“We’d be very surprised if anything happened before the federal election,” said Ian McCreary, a CWB director who heads up the board’s transportation committee.
“I think we’re looking at legislative processes in the fall of 2004, with the earliest implementation being Aug. 1, 2005.
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“That will be seven years we’ve been waiting on this,” he said, referring to long-standing federal government promises to bring in new rail transportation rules.
He added the board hopes to meet soon with new transport minister Tony Valeri to press for rapid action and a better bill.
Bill C-26, which received first reading in the House of Commons in February 2003, has failed to move beyond the transport committee.
The bill is seen as inadequate by many western grain shippers, who say it doesn’t do enough to force the railways to be more competitive and share productivity savings.
Critics say the bill fails to provide for joint running rights, doesn’t include a “reverse onus” rule that would require a rail company opposing a running rights application to prove it would be against the public interest and fails to provide protection for sidings and spurs in rural areas.
But nevertheless, some hoped the bill could be passed with amendments that would at least provide some immediate improvements.
“The legislation certainly has some things in it that can be seen as positive,” said James Nolan, an agricultural economist at the University of Saskatchewan who follows rail transportation issues.
“But things seem to have ground to a halt, basically.”
Proponents of change have taken heart from comments made by prime minister Paul Martin during the leadership campaign that he supported running rights.
But Nolan said it’s difficult to judge at this point if that will be translated into government policy, especially given the reputations of both Martin and Valeri of being sympathetic to the interests of big business.
The railways have “incredible lobbying power,” he added, and they seem to have pulled out all the stops in recent years whenever government has considered introducing running rights or other measures to boost competition.
There is also a school of thought that the federal government may wait to see the fate of similar legislation that is now before the U.S. Senate and the House of Representatives aimed at increasing rail competition.
“I think they want to see how aggressive the Americans are going to be, because it’s a North American rail market,” McCreary said.
The U.S. legislation is the product of lobbying by the Alliance for Rail Competition, which includes grain farmers along with shippers of products such as fertilizer, forest products, chemicals and cement.
Among other things, the bill would provide for final offer arbitration to settle rate disputes, ensure competition at switching points and terminal areas and review rates for reasonableness.
It would also provide for special rules in regions designated as “areas of inadequate rail competition” where shippers are captive to a single railway, and the establishment of a rail customer advocate within the U.S. Department of Agriculture.
Alliance chair Terry Whiteside said he expects the U.S. bill, which will be attached to a related piece of legislation that is of higher priority, will come to a vote this year, with changes going into effect before the end of this year.
“We’re very positive about the strength of the coalition we have put together here and that we’re going to start seeing some successes in the next few months,” he said, adding that grain shippers in Canada and the United States are in the same boat when it comes to rail competition.
