More Balanced Railway-Customer Relationship Sought

“It is not reasonable to expect any

operation to function competitively when vital transportation fails to arrive one in five times.”

– WESTERN CANADIAN SHIPPERS’ COALITION

The federal rail freight review panel made it clear last fall that it wanted final submissions from the railways and shippers to contain solutions and not just rehash old complaints.

The three-member panel appears to have gained its wish. The nearly 100 submissions received by the panel’s April 30 deadline seem focused on casting a more balanced relationship between CN, CP and their customers.

The submissions proposed several variations of a commercial dispute resolution system and an ongoing role for the Canadian Transportation Agency in monitoring the performance of the country’s freight transportation system.

A dispute resolution system was proposed several years ago at the urging of then transport minister Lawrence Cannon, but shippers and the railways could never quite agree on a system that would provide penalties for delays and other transportation snafus.

The panel will consider documents as well as the findings of research papers contracted by Transport Canada last year. A final report with recommendations for Transport Minister John Baird is expected by the fall.

PROTOTYPE DEAL

Observers suggest the way ahead has already been sketched out in an agreement struck April 29 between CN, the Halifax Port Authority and the operators of the port’s two container-handling facilities.

It provides for clear performance standards for each party’s performance in the Halifax Gateway supply chain.

The griping in Halifax about CN’s service in recent years and the railway’s defence would sound strikingly familiar to the grain industry and other western shippers. The Halifax deal covers times for unloading and loading containers between vessels and cars, the placement of rail cars at the terminals, and CN transit times to key markets in Eastern and Central Canada and the U. S. Midwest.

DISPUTE SETTLEMENT

The Canadian Wheat Board suggested a Rail Service Office within the CTA that would have 30 days to negotiate an agreement in a dispute between a shipper and railway or it could impose a settlement. The RSO would also make sure rail infrastructure in Canada remained suitable to industry and should hold semi-annual conferences where carriers and shippers could raise issues.

The Western Canadian Wheat Growers wants the CTA to have power to impose fines for poor rail service and to establish a Railway Service Monitor that would track the supply of empty rail cars and their pickup when loaded.

The WCWG also urged a higher freight cap be allowed for October through December when the shippers want the railways to move more grain to export positions.

The National Farmers Union suggested, the CTA “could establish performance measures and criteria, where penalties imposed by the agency would directly reduce the revenue cap monies if performance goals were not met. This would avoid the scenario of costs simply being passed on to farmers through other mechanisms.

It also wants regular costing reviews that include ensuring the railways are making sufficient investments in labour, running stock, and maintenance to meet their obligations.

UNACCEPTABLE PERFORMANCE

The Western Canadian Shippers’ Coalition said supplying 80 per cent of cars requested by a shipper shouldn’t be considered acceptable by the CTA. “It is not reasonable to expect any operation to function competitively when vital transportation fails to arrive one in five times. Nor is it the norm for any other mode of transportation to function as unpredictably as Canada’s rail freight system. Imagine the chaos at airports if passenger planes arrived and departed with the same inconsistency as rail freight cars. And how long would any airline survive the erratic transit times of a CN or CP?

“Shippers have the right to expect 100 per cent of the cars they order to be provided,” the coalition said. “They also have a legitimate expectation that their goods will arrive at destination in a predictable and consistent fashion. This should be the standard. It is particularly true for facilities that are completely captive to one carrier.”

The CTA should be empowered to step in whenever carriers fail to live up to their obligations, it added. This could provide “shippers with more leverage in their discussions with railways.”

It also said Final Offer Arbitration has to be made affordable and workable for small shippers, it said.

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