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LETTER: Setting a precedent with Marine Atlantic’s cost recovery

Port aux Basques Mayor John Spencer wants the federal government to reduce the cost recovery rate imposed on Marine Atlantic. In his motion presented at Municipalities N.L. Spencer wrote, “Cost recovery tears at the socio, economic and political fabric of Newfoundland and Labrador.”
Port aux Basques Mayor John Spencer wants the federal government to reduce the cost recovery rate imposed on Marine Atlantic. In his motion presented at Municipalities N.L. Spencer wrote, “Cost recovery tears at the socio, economic and political fabric of Newfoundland and Labrador.” - Contributed

Dear editor,

In 1977, Ottawa appointed a Royal Commission, chaired by Memorial University Professor Dr. Arthur Sullivan, to examine issues within Newfoundland's transportation system and make suggestions on solutions for future direction.

The commission crisscrossed the province completing extensive public review of all facets of Newfoundland and Labrador's transportation network from the constitutionally mandated Gulf, railway and coastal service to bus, road and air travel, while dovetailing into fishery, forestry, mining, agriculture, manufacturing, electric power, construction and tourism. There appeared to be little in the form of stones unturned in seeking answers to the future direction in Newfoundland's transportation needs.

Page 250 of the summary report made a recommendation that Ottawa failed to act upon, but a recommendation that today speaks volumes in the affordability issue of using the current constitutionally guaranteed interprovincial service linking Newfoundland with the rest of Canada.

The recommendation enshrined the belief that the body of water between Port aux Basques and North Sydney was to be the equivalent of an extension of the Trans-Canada Highway (TCH), and as such, the cost to travel the stretch of water should not be greater than the cost to cover the 90 miles. The 90 miles (144.84 km) is the distance between Port aux Basques and North Sydney. Considering the federal government today allows for an individual cost-recovery of 54 cents a kilometre for private vehicle use in seeking an essential service not available locally, the rebate for tax purposes on such a trip would be $78. Currently, the cost on a Marine Atlantic vessel for a vehicle one way is close to $100.

Imagine, for a moment, how much savings could be realized by the travelling public. Imagine the boost in tourism. Or even better, imagine the savings to consumers considering Marine Atlantic transports 90 per cent of all perishable products to Newfoundland by dropping the excess charges currently paid by truckers.

Newfoundland and Labrador residents are paying far too much directly, and indirectly, for the service Ottawa committed to provide in 1949. Imagine again, if during those negotiations in 1949, how people would have reacted knowing that a commitment to assume the service was contingent on Ottawa recovering costs. Finally, imagine the lost revenues to the economy in considering that if this recommendation by Dr. Sullivan made 1978 was honoured.

Instead of cost recovery for users equivalent to travel on the TCH, Ottawa's reply was to impose its own cost recovery on Marine Atlantic at a rate of 65 per cent. Such a move, combined with a fuel-surcharge averaging 21 per cent annually on every ticket sold, have forced fare increases that have now reached levels negatively impacting all who call this wonderful province home. For a family of four the total cost on a return trip now exceeds $800.

It is time for residents of Newfoundland and Labrador to speak out demanding Ottawa drop its cost-recovery on operations at Marine Atlantic, drop its fuel-surcharge and to realign fares to reflect the actual cost of the distance covered in the Cabot Strait the same as it would be to travel the 90 miles on the TCH fulfilling Dr. Sullivan's recommendation.

Does precedent exist for such a move? A newly constructed bridge set to open very soon in Montreal will not have cost-recovery. A pre-election federal promise made in 2015 was honoured. Commuters will use the estimated $ 7 billion plus, for the 30 year life of the bridge, cost free. Another large Crown corporation, VIA Rail, headquartered in that same city, has no cost recovery attached to its service. Why is our essential link being discriminated against?

2019 is an election year both federally and provincially. Newfoundland and Labradorians need to make their voices known.

Sincerely,

John Spencer,

Mayor, Port aux Basques

RELATED: MNL supports Port aux Basques proposal regarding federal cost recovery for Marine Atlantic

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