Western Grain Elevator Association

Western Grain Elevator Association

June 27, 2013 11:13 ET

WGEA Dissatisfied With Bill C-52

WINNIPEG, MANITOBA--(Marketwired - June 27, 2013) - The Western Grain Elevator Association (WGEA) is dissatisfied that the federal government passed Bill C-52, the Fair Rail Freight Service Act, without amendment.

The WGEA is a member of the Coalition of Rail Shippers (CRS), and both organizations were calling for six specific suites of amendments to Bill C-52, to ensure it achieves a balanced and proper foundation for good service. "Grain is competing with every other export industry in Canada to get product to our customers. As is not the case with grain, other industries can increase or decrease production based on demand. As the global economy recovers, grain will continue to fight an uphill battle for rail service," said Wade Sobkowich, Executive Director of the WGEA. "It appears that Transport Canada convinced the powers that be that this bill would solve current and future rail service problems. We are convinced it will not be enough."

The WGEA released a positive statement about Bill C-52 on the same day as it was introduced in the House of Commons, but, after further analysis, concluded that C-52 needed some significant repair to achieve the intent of government. "The CRS and all of its member organizations have been engaged through all of the review processes to impress upon the government the specific changes to the law required to provide some assurance we will be able to meet our contractual commitments with overseas buyers," added Sobkowich. "In the end, we distilled our many concerns to a set of six specific amendments that could have easily been adopted."

The six amendments put forward by the CRS would have taken away much of the ambiguity involved with rail service by better defining "adequate and suitable accommodation" and "service obligations" within the Canada Transportation Act. They would have forced a better balance in accountability by allowing penalties for poor performance to be included in a Service Level Agreement (SLA), reflecting the way railways penalize shippers through unilateral railway tariffs. The amendment also would have provided for an expedited and fair dispute resolution mechanism as an alternative to the little used, lengthy and costly provisions existing in the Act today.

All this comes on the heels of extremely poor service the grain industry has experienced in 2013. "The intent of the legislation is to ensure we don't have the type of service deficiencies that we've seen this year and in previous years," said Sobkowich. "The proof will be in the results - if we don't end up with good rail service in a sustained way, then it would prove the legislation did not go far enough and a material strengthening of the provisions is required." Sobkowich added that the WGEA will be watching very closely between now and the 2015 review of the Canada Transportation Act.

The WGEA is an association of grain businesses operating in Canada, which collectively handle in excess of 90% of western Canada's bulk grain exports. Its members account for approximately 20% of railway revenues and pay annual total rail freight of over one billion dollars.

The above press release has been approved by the members of the Western Grain Elevator Association in accordance with its governance policy, which allows positions to be taken forward with unanimous support of 85% of its membership.

Contact Information

  • Western Grain Elevator Association
    Wade Sobkowich
    Executive Director