Railway, shipper issues unresolved Legislation expected to be tabled after Parliament resumes sitting in late September
Transport Canada officials have the summer to prepare rail service legislation imposing rules on both railways and shippers negotiating shipper service agreements
Legislation is expected to be tabled after Parliament resumes sittings in late September.
“We have been contacted and told to have our comments in by the end of July,” Coalition of Rail Shippers chair Bob Ballantyne said. “We expect legislation in the fall for sure.”
Last week, after a five-month process failed to close the gap between the two railways and shippers, which includes farmers, former Alberta treasurer Jim Dinning recommended June 22 that both sides use a five-point plan to try to create voluntary service agreements.
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Transport minister Denis Lebel issued a statement urging both sides to voluntarily negotiate commercial agreements and service standards.
But after his attempt to find common ground between the two sides, it was clear Dinning failed to bridge the gap.
“The two unresolved key issues were to have the dispute resolution apply to the establishment of initial agreements and the timelines for resolving disputes,” he said in his report.
They were not minor issues. Shippers worry about railways playing major and minor shippers off against each other with “tiered” service promises.
“Really, CN came to the table saying that the status quo was fine, not really ready to make any compromises,” said Ballantyne. “That is why we need legislative back-up to give the process some teeth.”
Canadian National Railway issued a statement June 22 arguing that shipper demands for more government intervention and regulation were the problem.
The government should simply let the private negotiation system work, said the railway. The rail freight service review process already has produced improvements in company performance and collaboration with customers, said the Montreal-based railway.
Ballantyne said the company concession that it improved service after the government-ordered rail service review started shows that the carriers respond only when there is a threat of government action.
“I think that really reinforces our view that legislation with penalties for missing service level guarantees is needed to force compliance,” he said.
Regina Liberal MP Ralph Goodale, a former agriculture minister, said that the CN statement “proves the point” that the railways will respond only under threat of sanction.
“Unless there is a threat of legal consequences, then the railways won’t respond because they have the market power,” Goodale said from Regina.
