JUNE 1, 2000
BILL C-34'S GIFT TO THE RAILWAYS:
$1.3 BILLION OVER THE NEXT TEN YEARS
ALLAN, Sask.--"Railways have pocketed $700 over the last eight years because current transportation legislation doesn't include productivity-gain sharing. And because Bill C-34 repeats that error, rates will begin to rise immediately and will soon be far above railways' costs. Over the next ten years, as those rates rise, railway overcharging will total over $1.3 billion," said NFU Transportation Committee Chair Terry Boehm.
"C-34 lacks balance: its revenue cap includes a mechanism to adjust rates upward for inflation, but no complimentary mechanism to adjust rates downward so that farmers can share in increased system efficiency. This is clearly unfair. Because farmers contribute to increased system productivity--they pay to truck grain to ever-more-distant elevators and they pay for high-throughput elevators through increased handling tariffs--farmers must also share in system productivity gains through lower freight rates," said Boehm.
"Bill C-34 has numerous defects--a lack of controls or rate differentials and a lack of revenue sharing for shortlines, to name a few. But the most glaring defect--a defect that must be obvious even to MPs--is its lack of productivity-gain sharing. Surely our elected leaders can fix such a obvious omission," said Boehm.
The NFU has raised the issue of productivity-gain sharing in letters to all MPs. This issue will be the NFU's focus when it appears before the House of Commons Standing Committee on Transportation next week.
Prior to 1992, the Western Grain Transportation Act required that railways share productivity gains with farmers through lower freight rates. The 1995 Canada Transportation Act included a productivity-gain sharing mechanism but that mechanism was never activated.
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For More Information:
Terry Boehm, Transportation Committee Chair: (306) 255-2880 or 257-3689
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