Rail freight panel’s report pleases no one: MCO

An interim report from Transport Canada’s rail freight service review panel has drawn lukewarm reviews for proposing both “commercial solutions” and a “regulatory fallback” to deal with rail service issues.

The panel, chaired by former Alberta agriculture minister Walter Paszkowski, now wants public comment on its proposals, by a deadline of Nov. 8.

A final report from the panel is then expected to be handed in to federal Transport Minister Chuck Strahl by the end of this year.

One prominent shippers’ group, the Western Grain Elevator Association (WGEA) representing main-line grain handling firms, has already told the Manitoba Co-operator it’s “profoundly disappointed” in the report.

The Co-operator’s Allan Dawson, in the farm newspaper’s Oct. 14 issue, quotes WGEA executive director Wade Sobkowich as saying shippers of many kinds of commodities have recognized a “long-standing systemic problem” in rail.

But the interim report from the three-member panel, which also includes former rail executive David Edison and former shippers’ representative Bill LeGrow, “amounts to little more than saying we should wait another three to five years before doing anything,” Sobkowich said.

The panel, in its report, said its approach “provides an opportunity for the railways to demonstrate commercially their ability to properly deal with service issues on a sustained basis,” and if they can’t, the panel recommends “legislative remedies” to be drafted starting as soon as the government accepts the panel’s report.

Specifically, the panel recommends railways continue to work with stakeholders on commercial measures to improve rail service, to be followed up with an “assessment” by the federal government in 2013 to see if service issues have been “adequately addressed.”

Then, if the railways flunk the assessment, the panel’s recommended legislative remedies could be triggered right away, in whole or in part.

The panel noted Friday that its proposal does not even sit well with one of its own members.

Without naming names, the panel said a dissenting member “supports the regulatory package, but believes that advanced legislative drafting will be a disincentive for many stakeholders, particularly shippers, to enter into meaningful negotiations with the railroads” between now and 2013.

“Many stakeholders are seeking a return to railroad regulations and this recommendation would work in their favour,” the dissenting member said.

“Awkward”

Canadian National Railway (CN) spokesman Mark Hallman, in an email to Dawson, noted that dissension and agreed the panel’s “awkward approach” would undermine CN’s “positive momentum” in working with customers on supply chain initiatives from pickup to port.

And CN, he said, opposes the idea of more regulation; Canada’s economy “cannot afford the risk of misguided and unwarranted rail regulation.”

Among its other interim recommendations, the panel proposes that railways should consult with affected stakeholders on any changes in local train service and provide at least 10 days’ notice.

As well, the panel said, the railways “should commit to resolving service change disputes through an appropriate dispute resolution mechanism.” They should also negotiate such resolution mechanisms with shippers, shortlines and other stakeholders with the help of a Transport Canada facilitator, the panel said.

The panel also proposes the railways should take part in “good faith negotiations” to set up service agreements with any stakeholder who asks for them. Any agreements that “describe roles, clarify responsibilities and contain service elements” would serve to strengthen the railway/shipper relationship, the panel said.

“Enhanced reporting” is also recommended as a way for the railways to improve “supply chain visibility,” both at a “confidential, bilateral” level with customers and at a broader sector level with the public.

The panel’s proposed package of legislative remedies, meanwhile, “mirrors the recommendations for the commercial package.”