Carbon tax not reason for ending service: Greyhound

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This article was published 12/07/2018 (2314 days ago), so information in it may no longer be current.

OTTAWA — Greyhound Canada is rejecting the federal Conservatives’ claim the looming national carbon tax contributed to the firm’s decision to end its Prairie service this fall.

“No, it was not a factor,” wrote Stuart Kendrick, a senior vice-president for Greyhound Canada, in a Friday email to the Free Press.

On Wednesday, Tory industry critic Matt Jeneroux told the CBC he suspected the federal carbon tax played into the firm’s decision to end its business in the Prairies. When asked whether Ottawa should subsidize the company, the Edmonton MP said the federal Liberals should instead review their existing policies.

“The first thing that comes to mind is putting on a carbon tax — that’s a major disincentive to any company getting involved in the transportation industry,” he said. “That’s an incredible disincentive to continue the organization going in a way that they’ve done in the past.”

But Kendrick said that wasn’t part of the company’s equations.

“Bus passenger transport has been challenged by many factors: declining ridership in rural communities; increased competition from subsidized national and inter-regional passenger transportation services; the new entry of ultra-low-cost airlines, regulatory constraints and increased car travel,” he wrote.

“Despite best efforts over several years, ridership has dropped by 41 per cent across the country since 2010. In addition, there has also been a 35 per cent decline in package (shipments) since 2010, due to the growth of e-commerce and other discount couriers.”

The federal Tories have honed in on the federal carbon tax as one of their key political messages ahead of the 2019 election. A Hansard search shows the party’s MPs have used the phrase “carbon tax” on 1,890 separate occasions since the Trudeau government took office in fall 2015, 10 times more than the Liberals or NDP.

In a statement, Jeneroux said he was talking generally about the carbon tax’s impact on businesses, and his party sympathizes with those who have lost their only way to reach cities such as Winnipeg.

“A Conservative government will examine ways to keep rural communities connected, while protecting taxpayers’ hard-earned money,” Jeneroux wrote.

The Liberals’ carbon-tax policy is under siege from a Saskatchewan court challenge, a new Ontario government that cancelled an existing cap-and-trade program, and a lack of enthusiasm from provinces such as Manitoba, which prefers a flat $25-per-tonne levy to the federal system, which escalates to $50 from $20 by 2022.

Meanwhile, transportation experts are debating what sort of transportation market should exist when Greyhound leaves the Prairies.

Ata Khan, a Carleton University professor specializing in freight-transportation supply chains, said he was especially interested in the idea other experts suggested to the Free Press this week: to have existing First Nations shuttles to Winnipeg expand and serve other communities.

“The drivers and other persons planning and operating such shuttles will find employment,” he wrote in an email, while the vehicle size and route frequency “will be better matched with demand.”

Khan said it could spawn a co-operative model, where First Nations companies operating in various parts of the province harmonize so commuters and frequent users can have a subscription-style membership that sustains enough customers to keep remote lines operating, possibly with some subsidies.

The 1992 Royal Commission on National Passenger Transportation, which examined everything from highway safety to ferry service, looked specifically at ways of ensuring inter-city buses operated in remote Canadian communities.

The commission’s report studied the example of Britain, where privatizing bus services lead to a short period where numerous coach operators hit the market, only to exit within a few years. That left the firm National Express with an effective monopoly in many parts of the country, but the company had lower fares than beforehand, likely to ward off potential competitors.

But that pattern hasn’t always replicated itself elsewhere. When Saskatchewan closed down its government-run STC service in May 2017, about 10 companies proposed serving the cancelled routes.

“One year later, only two of those companies remain, and most of the routes have no common carrier passenger service,” wrote Cindee Hansen, a spokeswoman for the advocacy group Save STC, in an email.

Hansen said called Greyhound’s pullout “déjà vu,” and feared new operators, such as a northwestern Ontario company that’s proposing routes in Manitoba, will start “cherry-picking the few profitable routes,” leaving seniors, disabled and poor people with few options.

“It’s time for a national, subsidized transportation system that unites the country.”

The Manitoba government has said previous subsidies to Greyhound did not stop cuts from happening.

On Thursday, it asked Ontario and the western provinces to unite with Ottawa and ask the firm to extend bus service for two months beyond the planned Oct. 31 pullout, so private operators can craft business plans.

dylan.robertson@freepress.mb.ca