Department of Transportation and Works
Speaking Notes for
Honourable Tom Rideout
Minister
Marine Atlantic Advisory Committee
Delta Hotel, St. John�s, NL
January 13, 2005

• Mr. Chairman and members of the Advisory Committee, fellow presenters, good morning.
  
  
• I am pleased, on behalf of the Government of Newfoundland and Labrador, to appear before this Advisory Committee and articulate our views regarding the gulf ferry service.
  
  
• Joining me this morning are representatives from my Department, Transportation and Works, as well as representatives from the Department of Tourism, Culture and Recreation.
  
  
• Mr. Chairman, The Government of Newfoundland and Labrador has sent a strong and consistent message that the federal Government has a constitutional obligation to provide ferry service on the gulf. This is in accordance with Term 32(1) of the Terms of Union with Canada, which states: "Canada will maintain, in accordance with the traffic offering, a freight and passenger steamship service between North Sydney and Port aux Basques, which, on completion of a motor highway between Corner Brook and Port aux Basques, will include suitable provision for the carriage of motor vehicles."
  
  
• Our government believes that the federal government�s obligation under the Terms of Union is an enduring one. The federal government must fulfill its constitutional obligation to provide the gulf ferry service, either directly or by ensuring a service provider, such as Marine Atlantic Incorporated has the mandate and resources to do so.
  
  
• Mr. Chairman, the gulf ferry service is our highway to mainland Canada and other parts of North America.
  
  
• It delivers goods to our stores, exports to our markets, tourists to our hotels and loved ones to our homes. It is the gulf ferry service that has a virtual monopoly on transporting goods that are vital to the health and well being of the people of our province. The ferry service moves over 90 percent of all perishables and time sensitive goods to the province. It is also the primary surface access for our citizens to the rest of the country.
  
  
• The commercial freight demand for the ferry service is significant. In 2002, the service carried about 60 percent of all freight movements to and from the province. With the importance of just in time delivery to suppliers and customers, this service is vital to many sectors of our economy.
  
  
• The gulf ferry service affects the economy and lives of the people of Newfoundland and Labrador. I cannot state emphatically enough how critical this service is to our life in this province.
  
  
• The tourism industry in Newfoundland and Labrador, and in Canada, is part of one of the fastest growing industries in the world. In Newfoundland and Labrador, it has the potential to become one of the province�s most important generators of new wealth, jobs and investment.
  
  
• Newfoundland and Labrador relies on the gulf ferry service for over one-third of its non-resident tourists. Having the option of travelling the island in a "loop" by entering Port Aux Basques and exiting at Argentia, or in the opposite direction, is important. Thirty percent of all auto visitors follow this pattern.
  
  
• If Newfoundland and Labrador could attract as much tourism activity as the Maritime provinces average, the size of our non-resident tourism industry in this province would triple. Improvements to the gulf ferry service are absolutely critical to this important economic objective.
  
  
• Now is the time for a collaborative, comprehensive study, that would lay the groundwork for building the optimal ferry service of the future, based on a better understanding of the right mix of factors, components and timing needed to support and guide sustained economic growth in our province and strengthen our ties within Atlantic Canada.
  
  
• When the Marine Atlantic Advisory Committee was appointed on November 22, 2004, I wrote Minister Lapierre, expressing my pleasure with the establishment of the advisory committee and requesting that any planned rate increase be postponed pending the outcome of the review of the gulf ferry service.
  
  
•  A month later, on December 22, our government was very pleased to hear that Marine Atlantic had decided to freeze its rates from January 1, 2005 - December 31, 2006. In a news release that day, from the Minister of Tourism, Culture and Recreation, our government expressed our support for this decision.
  
  
• Increased rates for the Marine Atlantic service would be a definite barrier to our tourism industry and a detriment to other sectors of our economy.
  
  
• The subsidy provided by the federal government to Marine Atlantic for the gulf ferry service is far lower than the subsidy our government provides to our own intra-provincial ferry system.
  
  
• As you may be aware, our government announced in the 2004-05 provincial budget that we were increasing our ferry rates by 25% over a 4 year period. However, even with this increase, my department will continue to be subsidizing ferry rates by some 88% in recognition of the essential transportation links these ferries provide to our citizens.
  
  
• Federal funding support for the gulf ferry service has been more or less frozen since 1998 while Marine Atlantic�s annual costs has continued to climb. This is an unsustainable policy which must be changed. The current subsidy support, which we understand to be 41%, must be increased to sustain our lifeline to the rest of Canada.
  
  
• Rates should be at an acceptable level and not escalated in an attempt to have users of the service meet costs which are the responsibility of the federal government. The federal government must ensure the continuation of a service which is accessible, affordable and meets the needs of Newfoundland and Labrador.
• The province�s research clearly shows that cost and accessibility are major factors which influence a traveler�s decision to visit a destination and how often they visit. Simply put, when costs go up, visitations go down.
  
  
• In 1999, the Government of Newfoundland and Labrador, in partnership with key stakeholders, sought input from people throughout the province with an interest in the gulf ferry service. Five regional forums were held and 1,150 people attended.
  
  
• The Advisory Committee should take into full account the recommendations made in the 1999 report to the Government of Canada, entitled On Deck and Below, which was forwarded to the Government of Canada for review and response.
  
  
• In November 2003, the Canada Industrial Relations Board concluded that any reduction or interruption in the Marine Atlantic ferry service would endanger public health and safety.
  
  
• They further ordered that: "there is to be no reduction in the level of Marine Atlantic Inc's regular ferry service between Newfoundland and Nova Scotia at any time of the year."
  
  
• The federal government must create legislation to ensure there is no interruption to the gulf ferry service.
  
  
• Given the importance of this service to our province, our people and our economy, the province of Newfoundland and Labrador is committed to working with the federal government to develop a long term strategy to sustain the gulf ferry service for future generations.
  
  
• We are seeking a commitment from the federal government that once the Advisory Committee has gathered their data, that the Minister of Transport, the Honourable Jean-C. Lapierre, meet with me in my capacity as provincial minister of transportation, and discuss the recommendations of the committee, before any action is taken toward implementation.
  
  
• This collaborative approach may facilitate a mutually satisfactory outcome and resolution to outstanding issues that face the gulf ferry service, with the view to achieving a sustainable long-term strategy for future generations.
  
  
• The significance of the gulf ferry service to the future of this province cannot be overstated. It is a service that exists for the people of Newfoundland and Labrador. It is a constitutionally guaranteed piece of infrastructure that is critical to the supply of goods and services, access to family and friends, and the development of opportunity and prosperity. The ability for all residents to have reliable, stable and affordable access to this service is paramount.
  
  
• With that, Mr. Chairman, I conclude my remarks and wish the advisory committee good luck in your examination of the gulf ferry service. Thank-you.