Hopper Car Decision by the Federal Government
Will be Costly for Farmers
(March 14, 2005, Airdrie) "The
decision by the federal government to transfer the hopper car fleet to the
Farmer Rail Car Coalition (FRCC) will prove costly to farmers and the
grain industry in western Canada" said Albert Wagner, Past President,
Western Barley Growers Association (WBGA) when commenting on the
announcement by federal Ministers Lapierre and Goodale.
"The government has decided to move ahead with the divestiture of
these cars and ignore the House of Commons Standing Committee on Transport
recommendations which included a due diligence process to determine costs,
benefits to producers and taxpayers, and establish an open and transparent
request for proposals" commented Wagner.
Transport Canada officials had testified to the Standing Committee on
Transport that they did not have the actual maintenance costs of the
hopper cars. At the same hearing, Transport Canada officials also
testified that there were provisions to reduce the revenue cap if charges
by the railways were inflated and that no change of ownership was required
to address maintenance cost issues.
"Since the premise of the FRCC proposal is in savings in maintenance
costs, would it not make sense that the government would want to know if
charges by railways were excessive and if the estimated savings claimed by
the FRCC are realistic before making a decision" questioned Wagner.
"The FRCC proposal will add operating overhead costs to farmers of
some $2 million annually, while entrenching tariffs by the US against our
wheat, and add another political entity to hopper car allocation, with no
improvement to efficiencies in our handling and transportation
system" said Wagner.
"Had the government followed the recommendations of the Standing
Committee on Transport, farmers and taxpayers in Canada could have gained,
however both now stand to lose. One of the recommendations from its
committee was for the government to retain ownership and adjust the
revenue cap to reflect actual maintenance costs - at this time that is the
most productive alternative" commented Wagner. |
