Considerations for Transport Committee’s review of Bill C-33, Strengthening the Port System and Railway Safety in Canada Act

Rob MacKay-Dunn and Isabelle Pelletier, co-executive directors of the National Maritime Group, made the following submission to the House of Commons Transport Committee, currently studying Bill C-33, Strengthening the Port System and Railway Safety in Canada Act.

Introduction

The modernization of Canada’s supply chain governance is essential for today’s economy. We are pleased to see the bill recognizes that national economic security is closely linked to the stability of Canada’s national and international supply chain. We thank the committee for undertaking this important work, which recognizes the significance of Canada’s supply chains and ports in ensuring the safe and efficient movement of goods across the country. 

Canada’s private sector maritime employers play a crucial role in Canada’s national supply chain, driving Canada’s overall economic and social prosperity

National Maritime Group is a coalition that represents nearly 100 private sector maritime operators from coast to coast and through the St. Lawrence, moving over $790 million worth of cargo daily — that’s 340 million tonnes of cargo through Canadian ports annually.  

Additionally, coalition partner associations contribute $2.1 billion to GDP annually and $4.3 billion in economic output.

Our member companies provide well-paying family-supporting jobs directly and indirectly to more than 35,000 Canadians working in port-related operations, while 213,000 jobs at Canada’s ports are dependent on coalition member operations. Our coalition includes marine carriers and agents, stevedores, container, break bulk terminal operators.

Our members invest billions of dollars into infrastructure, technology, equipment and people to ensure sufficient capacity to address current and projected growth in trade volumes efficiently, safely and in an environmentally responsible manner.

We are a collaborative partnership of the British Columbia Maritime Employers Association (BCMEA), Maritime Employers Association (MEA), Halifax Employers Association (HEA) and the Port of Saint John Employers Association (PSJEA). 

Thoughtful and measured approach to evaluating Bill C-33 needed

Bill C-33 is a comprehensive and substantive piece of legislation, proposing significant changes to several complex aspects of existing legislation governing the Canadian supply chain and potentially impacting the safe and efficient movement of goods. These consequential amendments will be brought to life in the coming years through new regulations, and as such, it may be premature to offer an ultimate comment on the overall efficacy of the proposed bill, given that the true impact of this legislation will be determined by the subsequent regulations that will be developed. 

We therefore urge the committee to take a thoughtful and measured approach in evaluating the proposed bill. As with any piece of legislation governing complex operations, it is critical to acknowledge potential risks and unintended consequences that may arise.

As such, the government must take an active role in working with all stakeholders in the course of the development and implementation of the subsequent regulations if C-33 is passed. Effective and balanced oversight is essential to ensure that the legislation is operationalized in a manner that best serves the interests of supply chain users and all Canadians. This oversight should include addressing any unintended consequences that may arise during the implementation phase.

With regards to some specific known elements of the legislation and proposed changes during witness testimony in committee to date, we would like to offer the following comments:

Ministerial appointment of board chairs could undermine the perceived independence of port authorities

We are concerned with elements of the governance regime proposed in the bill, particularly with respect to the potential politicization of port authority boards. Specifically, we request clarity on the intent and efficacy of clause 105, which would grant the Minister of Transport the authority to directly appoint the board chairs of Canada’s Port Authorities (CPAs). 

Such a provision could undermine the perceived independence of CPAs, make them less responsive to local users and communities and potentially shift them towards the characteristics of a crown corporation. Granting this authority to the minister may also contribute to the perception that decision-making is centralized in Ottawa, rather than involving experienced professionals in the local communities where the ports operate.

We recommend these clauses be removed from the bill. 

Proposal to include direct labour representation on port authority boards may hinder effective, balanced decision-making

We understand there has been a suggestion to amend the proposed legislation to include the appointment of active union representatives on CPA boards. 

As the President and Chief Executive Office of the ACPA recently told the committee, the proposal suggests that there is some confusion about what the role of the board directors is. 

Their role is not to run the port or to serve a personal or professional agenda. They owe a fiduciary duty to the corporation itself. 

We strongly believe that including direct labour representation on CPA boards is not a prudent governance choice. It has the potential to hinder effective and balanced decision-making and may result in constant and unmanageable conflicts of interest at both the board and operational levels, just as it would if terminal operators themselves were appointed as directors to CPA boards. 

Timeliness of appointments to port authority boards critical for economic competitiveness

Timely appointments to CPA boards are critical for ensuring the smooth functioning of our industry. Delays in board appointments can have significant impacts on both CPAs and operators. We encourage the committee to further consider this aspect and suggest defining clear timelines for the minister to designate appointees based on the recommendations received. 

Conclusion: Resilient supply chains critical to Canada’s economic vitality

In conclusion, we urge the committee to take a thoughtful and measured approach when considering the provisions of Bill C-33, particularly with respect to the governance clauses and proposals that have been put forward during recent committee hearings. We also ask the government to continue working with all stakeholders during the development and implementation of subsequent regulations, should the bill become law.  

Canada is a trade-dependent economy that relies on both exports and imports, as well as the efficient movement of goods within the country. As a result, well-functioning supply chains are critical to the welfare and economic vitality of the country. The potential impact of this legislation on the operation of Canada’s supply chains is significant, and it is essential to balance the need for reform with the requirement for prudent governance.

We look forward to ongoing collaboration as we work together to strengthen and build resilient supply chains to ensure Canada’s economy thrives.