Rail bill does not deliver for Canada's largest shipper - the mining industry

Mining industry seeking amendments to Bill C-52 to improve service

OTTAWA, Feb. 28, 2013 /CNW/ - The Mining Association of Canada (MAC) today informed the House of Commons Standing Committee on Transport, Infrastructure and Communities that Bill C-52, the Fair Rail Freight Service Act, does not go the distance in overcoming the rail service failures that gave rise to the bill in the first place.

The Canadian mining industry is the single largest customer of Canadian railways. In 2011, Canadian miners accounted for 54% of total Canadian rail freight revenue, and just under half of total commodity freight volume carried.

"While our industry appreciates the government's initiative in attempting to partially correct the imbalance of railway market power through its initial review and the tabling of this bill, we believe it does not deliver on the government's promise to enhance the efficiency and reliability of the entire rail freight supply chain," said Pierre Gratton , MAC's President and CEO. "As currently written, we do not believe the bill will achieve the government's stated intention."

MAC is urging the federal government to make amendments to the bill to correct the issues that were identified in Transport Canada's Rail Freight Service Review, and to improve the bargaining relationship between railway companies and shippers.

Although the bill features some positive changes that MAC and the Coalition of Rail Shippers (CRS) advocated for during the government review and consultation process, the recommendations that are currently absent from the bill pose the greatest challenges to the shipping community. For example, although Bill C-52 gives shippers a statutory right to a Service Level Agreement, it does so without defining that service. Without specifying the elements of service that a shipper needs, an arbitrator will have no direction in a process that, unless amended, weighs heavily in the railway's favour. 

The industry, through MAC and the CRS, has proposed six amendments to the committee today in order for Bill C-52 to achieve the government's intended outcomes. (See link to Backgrounder below for amendment information).

"The current imbalance and associated service failures have resulted in unreliable service and higher costs for the mining industry, its partners and customers.  We urge the government to consider our amendments given that insufficient rail freight service adversely affects the entire logistics supply chain and, in turn, the Canadian economy as a whole," said Gratton.

Overcoming Canada's vast geography to deliver products effectively to and from ports and smelters is crucial, especially when competing against countries with significantly shorter logistical supply chains. In this respect, rail freight service is a key component of the mining industry's ability to compete internationally.

BACKGROUNDER: MAC and the CRS proposed amendments to Bill C-52 available at www.mining.ca.

About MAC
The Mining Association of Canada is the national organization for the Canadian mining industry.  Its members account for most of Canada's production of base and precious metals, uranium, diamonds, metallurgical coal, mined oil sands and industrial minerals and are actively engaged in mineral exploration, mining, smelting, refining and semi-fabrication. Please visit www.mining.ca.

SOURCE Mining Association of Canada (MAC)