Grain companies and Canadian Nat ional Railway (CN) turned thumbs down on the Rail Freight Service Review panel’s interim report, but for different reasons.
The grain companies say the report commissioned by Transport Canada released Oct. 8 after two years of consultation is flawed because it fails to recommend the federal government immediately legislate the railways to provide better service.CN
complains because two of
the three panel members recommend legislation be ready to implement if the railways don’t improve service by 2013.
The Canadian Wheat Board and Keystone Agricultural Producers were still studying the report when contacted for comment last week. However, in submissions to the panel, both called for additional regulations to ensure better service for western grain shippers.
“We are profoundly disappointed in the report,” Wade Sobkowich, executive director of the Western Grain Elevator Association (WGEA), said in an email.
“The panel was asked to come up with recommendations to address a long-standing systemic problem with the Canadian rail system that has been recognized by rail shippers of all types of commodities and products. The panel’s draft report… amounts to little more than saying we should wait another three to five years before doing anything. That is unacceptable. Recommending the government ‘do nothing’ could have been done at a much cheaper cost.”
Although CN was still studying the report, spokesman Mark Hallman said in an email Oct. 8 the railway opposes more regulation.
“This awkward approach – a subject of panel dissension… – would undermine the positive momentum of CN’s supply chain collaboration initiatives,” he said. “Moreover, it would undermine the rail industry’s ability to invest in service and infrastructure improvements.
“Railways are crucial to the Canadian economy and its competitiveness in global markets. And that economy cannot afford the risk of misguided and unwarranted rail regulation…”
The report says the panelist who doesn’t support ready legislation fears doing so will discourage shippers from trying to work out commercial solutions with the railways.
“Many stakeholders are seeking a return to railroad regulations and this recommendation would work in their favour,” the report says on behalf of the dissenting panelist.
Interested parties have until Nov. 8 to respond to the interim report and eight recommendations before the panel’s final report is submitted to the federal government by Christmas. (See Transport Canada’s web-site http://www.tc.gc.ca/eng/policy/acg-rfs-review-examensfm-rvw-eng-2546.htm for submission details.)
The recommendations from the interim report are as follows:
1) That railways, in collaboration with their stakeholders, continue to develop commercial measures to improve rail service, including the four key elements related to service changes, service agreements, dispute resolution and enhanced reporting.
2) Prior to changes in local train service, railways should consult affected stakeholders at least 10 working days in advance.
3) Railways should enter into good faith negotiations to establish service agreements upon request by stakeholders.
4) Railways, assisted by Transport Canada, should negotiate a fair and balanced dispute resolution process with customers and short lines.
5) Railways should improve supply chain visibility with enhanced reporting.
6) Drafting legislation to regulate railway service should begin immediately following the government’s acceptance of the panel’s recommendations. (One panelist dissents and recommends that the regulations not be drafted and approved until the 2013 review of rail service determines it’s necessary.)
7) An assessment be undertaken in 2013 to determine how the railways’ commercial initiatives have addressed rail service issues and to determine whether or not to trigger legislation as a fallback provision.
8) A “trigger” should be included in the legislation that would allow the governor-in-council to bring fallback provisions into force in whole or in part, if necessary, following the completion of the 2013 assessment. (One panelist dissents, given his view regarding the timing of legislative drafting.)
“Thisawkward approach–a subjectofpanel
– MARK HALLMAN