Federal transport minister Jean Lapierre is expected to go to cabinet in mid-January with a proposal on how to deal with 13,000 government-owned grain hopper cars.
One well-connected Parliament Hill player said it will favour the Farmer Rail Car Coalition. The coalition is proposing to create a farmer-controlled non-profit corporation to own and maintain the hopper car fleet.
The idea has faced fierce opposition and competing proposals from grain companies, railways and farm organizations.
Lapierre said he wanted to go to cabinet on the issue by year-end but he was not ready for a presentation at the last 2004 cabinet meeting Dec. 16. He expects to make a proposal to cabinet in mid-January.
Read Also
Farming Smarter receives financial boost from Alberta government for potato research
Farming Smarter near Lethbridge got a boost to its research equipment, thanks to the Alberta government’s increase in funding for research associations.
The government source said: “Things could change but I believe the minister is leaning to proposing a five-year lease to the FRCC and we’ll see where it goes from there. I think we’re getting to decision time and it will favour the coalition.”
Finance minister Ralph Goodale, while avoiding any prediction about how the cabinet debate will go, said in a Dec. 16 interview he supports the coalition option.
“It’s an idea I’ve been interested in now for maybe two years,” he said after the cabinet meeting. “Whether or not that is at the end of the day the most advantageous proposal remains to be seen, but it does carry with it some cost advantages, some flexibility advantages as well, so it’s an idea that is definitely in the mix.”
Goodale said ministers have been discussing how to bring the issue to conclusion eight years after then-finance minister Paul Martin announced in his 1996 budget that he wanted to sell the cars as part of the fight against the deficit.
“It’s been discussed among ministers but it has not yet become a formal agenda item,” he said. “It will very soon.”
Meanwhile, a last-minute rival proposal for managing the cars was delivered to Lapierre Dec. 7 by a coalition of western farm groups and elevator owners opposed to the farmer coalition plan.
The proposal from the group that includes western wheat and barley growers’ associations and Saskatchewan canola growers, western grain elevator and inland terminal groups is to create a lease company to own and manage the cars.
Like the coalition, it proposes that the department turn over car ownership for a nominal sum but insists that if there is a purchase requirement, a $5 million-a-year lease-to-buy contract could be signed for 20 years.
It promises the railways a five-year lease arrangement to be made permanent then and predicts that annual maintenance costs will be $2,000 per car, rather than the $1,500 proposed by the coalition and the $4,329 now included in the rate cap formula used by the railways.
“The objective (is to) manage, maintain and renew the federal hopper car fleet on commercial principals (sic) through a collaborative governance structure that meets the goals not only of the western grain shipping community including farmers, but will also allow the federal government to accomplish its stated goal regarding disposal,” the group said in the proposal.
On Parliament Hill, Saskatchewan Conservative MP and coalition critic David Anderson wanted the new proposal investigated by the Commons agriculture committee.
“It would be irresponsible not to look at all the options out there,” added Manitoba Conservative James Bezan.
In a close vote, Liberal and Bloc Québecois MPs combined to rule out a committee hearing on the new proposal.
Liberal Wayne Easter, one of the coalition’s most fierce boosters, said the latest proposal was put together at the last minute to “inject confusion” into the government decision-making process.
He said members of the new coalition had appeared before the committee earlier and offered positions that contradicted their proposal, including criticism of the coalition plan that the cars be turned over for little cash.
