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2008-09
Departmental Performance Report

Transport Canada

The original version was signed by
The Honourable John Baird, P.C., M.P.
Minister of Transport

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Table of Contents

• Minister’s Message

• SECTION I – DEPARTMENTAL OVERVIEW
  • 1.1 Summary Information
    • 1.1.1 Raison d’être
    • 1.1.2 Responsibilities
    • 1.1.3 Strategic Outcomes and Program Activity Architecture
    • 1.1.4 2007-2008 and 2008-2009 Program Activity Crosswalk
  • 1.2 Performance Summary
    • 1.2.1 Financial Resources ($ millions)
    • 1.2.2 Human Resources (Full-Time Equivalents)
    • 1.2.3 Summary Tables by Strategic Outcomes
  • 1.3 Risk Analysis
  • 1.4 Contribution of Priorities to Strategic Outcomes
  • 1.5 Expenditure Profile
    • 1.5.1 Departmental Spending Trend
    • 1.5.2 Voted and Statutory Items

• SECTION II– ANALYSIS OF PROGRAM ACTIVITIES BY STRATEGIC OUTCOME
  • 2.1 Strategic Outcome:  An efficient transportation system that contributes to Canada’s economic growth and trade objectives
    • 2.1.1 Program Activity:  Transportation Policy Development and Infrastructure Programs
  • 2.2 Strategic Outcome:  A safe and secure transportation system that contributes to Canada’s social development and security objectives
    • 2.2.1 Program Activity:  Transportation Safety and Security
  • 2.3 Strategic Outcome:  An environmentally responsible transportation system that contributes to Canada’s sustainable development objectives
    • 2.3.1 Program Activity:  Sustainable Transportation Development and the Environment

• SECTION III – SUPPLEMENTARY INFORMATION
  • 3.1 Financial Highlights
  • 3.2 List of Tables
  • 3.3 Other Items of Interest

Minister's Message

As Canada’s Minister of Transport, I am pleased to present Transport Canada’s Departmental Performance Report for 2008-09.

Transportation touches most Canadians every day, and generates nearly 12 per cent of Canada’s Gross Domestic Product. Each year it accounts for 1.8 billion passenger trips and moves over $1 trillion worth of goods to market. Canada needs a safe, secure, efficient and clean transportation system that works well. This is good for the people who use it, and good for our economy, helping us to compete in challenging global markets.

That is why in 2008-09, we delivered. We delivered a wide range of programs. We spent significant time and effort to streamline programs and legislation to support Canada’s Economic Action Plan. And over the next five years, we will be investing almost one billion dollars in the country’s roads, bridges, border crossings and transit systems. In 2008-09 Transport Canada also:

• supported technology research and innovation;
• took action to reduce transport-related emissions, through regulations and programs;
• took steps to improve the liability and compensation regime for pollution damages caused by marine oil spills;
• conducted environmental assessments, cleaned up contaminated sites, detected marine pollution incidents and increased the environmental sustainability of Transport Canada’s lands, facilities and operations;
• advanced Canada’s performance-based approach to reducing transportation safety risks and security threats, and promoted a ‘safety and security culture’ in the transportation industry;
• managed contribution funding programs that help the motor vehicle, rail and urban transit and marine sectors address operational safety and security concerns;
• introduced in Parliament, amendments to the Transportation of Dangerous Goods Act and the Arctic Waters Pollution Prevention Act;
• worked with international partners to make sure that our policies, programs, legislation and regulations are strengthened, better aligned and harmonized
  in a way that reduces trade barriers; and
• increased aviation security by reviewing the aviation security framework, testing new ways of screening air cargo, and enhancing passenger assessment.

Transport Canada is proud of what it has accomplished with the cooperation of our many partners in industry and government, both here and abroad, and looks forward to meeting the challenges of the future.

The original version was signed by

John Baird, P.C., M.P.
Minister of Transport

SECTION I – DEPARTMENTAL OVERVIEW

1.1 Summary Information

1.1.1 Raison d’être

Transport Canada is responsible for the Government of Canada’s transportation policies and programs. The department has the added responsibility, under the Canada Transportation Act, to monitor the ongoing health of the national transportation system. As such, while not directly responsible for all aspects or modes of transportation, the department plays a leadership role to ensure that all parts of the transportation system work together effectively.

The department’s vision of a sustainable transportation system is one that integrates and balances social, economic and environmental objectives. Our vision is guided by the following principles:

• highest practicable safety and security of life and property – guided by performance-based standards and regulations when necessary;
• efficient movement of people and goods to support economic prosperity and a sustainable quality of life – based on competitive markets and targeted use of regulation and government funding; and
• respect for the environmental legacy of future generations of Canadians – guided by environmental assessment and planning processes in transportation decisions and selective use of regulation and government funding.

1.1.2 Responsibilities

In February 2006, Transport Canada became part of the Transport, Infrastructure and Communities portfolio, which also includes Infrastructure Canada, three agencies operating at arm's length from the department, 16 Crown corporations (e.g. VIA Rail, Marine Atlantic) and over 40 shared-governance organizations (e.g. Port of Montreal, Vancouver International Airport). The creation of this portfolio has provided an unprecedented opportunity to integrate transportation policies and infrastructure funding programs (e.g. $2.1 billion for gateways and border crossings). Under this Portfolio, the Minister heads a complex organizational structure, and is responsible for administering over 60 statutes.

1.1.3 Strategic Outcomes and Program Activity Architecture

Text version for Figure 1

1.1.4 2007-2008 and 2008-2009 Program Activity Crosswalk

Transport Canada modified the program activities from 2007-08 to 2008-09, as outlined in the 2008-09 Report on Plans and Priorities. Only the titles of the program activities changed, as illustrated in the table below. This had no impact on financial resources allocated to each program activity.

Figure 2: Program Activity Architecture Crosswalk

	2008-09
($ thousands)	Transportation Policy Development and Infrastructure Programs	Transportation Safety and Security	Sustainable Transportation Development and the Environment
2007-08
Policies, Programs and Infrastructure in support of a market-based framework	521,681
Policies, Rulemaking, Monitoring and Outreach in support of a safe and secure transportation system		612,696
Policies and Programs in support of Sustainable Development			201,931

It should be noted that Transport Canada completely restructured its Program Activity Architecture in 2008-09 which is reflected in the 2009-10 Report on Plans and Priorities. Consistent with the Treasury Board guidelines, for the purposes of this report, Transport Canada is reporting against the structure that was used in the 2008-09 Report on Plans and Priorities.

1.2 Performance Summary

To support its mandate, Transport Canada was assigned the following resources:

1.2.1 Financial Resources ($ millions)

Planned Spending	Total Authorities	Actual Spending
1,336	1,463	1,040

1.2.2 Human Resources (Full-Time Equivalents)

Planned	Actual	Difference
5,155	5,165	10

1.2.3 Summary Tables by Strategic Outcomes

Strategic Outcome 1: An efficient transportation system that contributes to Canada’s economic growth and trade objectives

Performance Indicators	Expected Results
Productivity of the transportation system Price and service levels Financial viability of the components of the system	Long-term sustainable funding and accountability framework for transportation infrastructure Strengthened international competitiveness Legislative/policy frameworks that support free market forces with targeted government intervention
2008-09 Performance
Took steps towards long-term sustainable funding for transportation infrastructure by signing over $1 billion worth of agreements with provinces, municipalities and territories to provide funding for current needs and to address future demand. Improved the air transportation industry’s international competitiveness by amending the Canada Transportation Act and concluding a new air transport agreement with the European Union and by negotiating new or expanded bilateral agreements with five other countries. Increased the international competitiveness of Canada’s national ports by amending the Canada Marine Act and introducing targeted policies that provide ports with more business opportunities and facilitate port amalgamation. Made progress towards increasing the overall efficiency of the transportation system by supporting/funding transportation research and innovation to help the transportation sector develop and deploy new technologies.

($ millions)

Program Activity 1	2007-08 Actual Spending	2008-09				Alignment to Government of Canada Outcomes
		Main Estimates	Planned Spending	Total Authorities	Actual Spending
Transportation Policy Development and Infrastructure Programs	124	218	522	507	200	A fair and secure marketplace Strong economic growth

The variance of $307 million between Total Authorities and Actual Spending was primarily the result of reduced spending in the following contribution programs during the year:

• Gateways and Border Crossings Fund of $204 million;
• Asia Pacific Gateway and Corridor Transportation Infrastructure Fund of $45 million;
• Port Divestiture Fund of $33 million; as well as
• several other minor program variances of $9 million.

The remaining variance of $16 million was primarily the result of staffing delays and various capital project delays.

Strategic Outcome 2: A safe and secure transportation system that contributes to Canada’s social development and security objectives

Performance Indicators	Expected Results
Level of public confidence Accident/incident rates relative to increase in traffic Fatality rates relative to accident/incident rates Progress in implementing safety and security management systems	Continuous improvement in transportation safety and security Public confidence in Canadian transportation safety and security
2008-09 Performance
Improved Canada’s transportation safety and security regimes through continued implementation of a performance-based approach to reducing risks and threats, and the continued development of a ‘safety and security culture’ across the transportation industry. Continued contribution programs that help stakeholders strengthen motor vehicle, marine, rail and urban transit safety and security. Strengthened and modernized Canada’s safety and security regulatory frameworks and reduced barriers with international trading partners through improved harmonization of policies and programs. Increased aviation security through the review of the aviation security framework, the testing of new screening methods for air cargo and enhanced passenger assessments. Decreased the accident rates in the aviation, marine, rail and road transportation modes in 2008, despite an increase in overall traffic. The number of fatalities in all four modes also decreased compared to 20072 levels.

($ millions)

Program Activity 1	2007-08 Actual Spending	2008-09				Alignment to Government of Canada Outcomes
		Main Estimates	Planned Spending	Total Authorities	Actual Spending
Transportation Safety and Security	566	613	613	672	629	A safe and secure Canada

The variance of $43 million was primarily the result of:

• the ending of the Transit Security Contribution under the Passenger Rail and Urban Transit Security Contribution Program for $10 million;
• implementation delays in the Marine Security Contribution Program of $7 million; as well as
• several other minor program variances totalling $3 million.

The remaining variance of $23 million was primarily the result of staffing delays and various capital project delays.

Strategic Outcome 3: An environmentally responsible transportation system that contributes to Canada’s sustainable development objectives

Performance Indicators	Expected Results
Percentage of Sustainable Development Strategy Targets Levels of air pollution and GHG emissions from transport Number of marine pollution incidents detected Number of Transport Canada contaminated sites remediated Number of project environmental assessments completed	Increased environmental sustainability of Canada’s transportation system and Transport Canada’s operations
2008-09 Performance
Laid the foundation for future emissions reductions in the transportation sector through ongoing voluntary agreements with industry, consultations on proposed new regulations, and through programs outlined in the ecotransport Strategy. Improved the liability and compensation regime for pollution damages caused by marine oil spills through amendments to the Marine Liability Act introduced in Parliament. Continued to protect the natural environment by conducting environmental assessments, remediating contaminated sites and detecting pollution from marine incidents. Increased knowledge, awareness and engagement in green transportation through guidelines, toolkits, reports, workshops, conferences, awards, webinars, and website presentations.

($ millions)

Program Activity 1	2007-08 Actual Spending	2008-09				Alignment to Government of Canada Outcomes
		Main Estimates	Planned Spending	Total Authorities	Actual Spending
Sustainable Transportation Development and the Environment	146	202	202	283	210	A clean and healthy environment Strong economic growth

Lower spending in some programs generated a variance of $73 million during 2008-09, the most significant portion attributable to the sunsetting of the ecoAUTO rebate program on March 31, 2009, which created a variance of $49 million, as well as small variances in other programs totalling $8 million. The remaining variance of $16 million was primarily the result of staffing delays.

1.3 Risk Analysis

The transportation sector touches almost all Canadians. It accounts for nearly 12 per cent of Canada’s Gross Domestic Product. Each year it accounts for over 1.8 billion passenger trips and moves over $1 trillion worth of goods to market.

The way Transport Canada performs and delivers services is influenced by Canada’s changing social, economic and political landscape, by international trends and by our strong partnerships with a broad range of institutions and organizations.

Key factors that affect the department’s performance and decision-making process include:

Globalization. Globalization is transforming Canada’s manufacturing processes and trade patterns. It calls for rapid access to and from Canadian markets and a systems-based approach to reduce congestion and increase capacity at several key gateways and land border points. This approach positions Canada as an efficient, reliable transportation choice to connect North America to the world. Shifts in the global economy are also creating opportunities both internationally and in Canada’s North.

The Environment. Canadians are becoming more concerned about the environment and expect all levels of government to protect their environment and health. The transportation sector is responsible for about 27 per cent of all greenhouse gas emissions in Canada. Addressing this issue is a challenge since there are many different pollution sources and cooperation and buy-in is required among different levels of government and international partners as well as among transportation providers and consumers.

Safety and Security. A safe and secure transportation system is vital to Canada’s economic competitiveness, standard of living and relationships with global trading partners. Increased safety depends on a strong, systemic safety culture and more accountability from transportation sector operators. Canada is still viewed as a target for potential terrorists attacks and Transport Canada must respond to the security concerns
of our trading partners, while keeping security policies from becoming trade barriers.

The Economy. The past year saw record increases in the price of crude oil per barrel, which in turn affected retail fuel prices for all modes of transport. Then a dramatic worldwide recession and financial market crisis made prices drop and the economy slow down. The economic slowdown in the U.S. and other key trading partners reduced demand for Canadian exports, which caused a sharp drop in prices for Canadian commodities. This directly impacted the transportation sector, since transportation is a derived demand.

Governance Pressures. Transport Canada completed its strategic review in 2008-09, identifying ways to streamline its operations, realign its activities and transform its organization to deliver better results for Canadians. A corporate risk profile was also completed, which supported the executive team’s decisions related to internal audit planning and other types of integrated business planning.

1.4 Contribution of Priorities to Strategic Outcomes

Program Priority 1: Market-based policy framework (Ongoing)
Policy/legislative frameworks that improve transportation services by allowing transportation activities to adapt, innovate and remain competitive.

Linkage to Strategic Outcome: An efficient transportation system that contributes to Canada’s growth and trade objectives.

Priority Status: Mostly Met

Transport Canada:

• amended the Canada Marine Act and implemented targeted policies that provide Canada Port Authorities with a wider array of business opportunities.
• amended the Canada Transportation Act and negotiated new or expanded existing international agreements, which create new opportunities for air carriers and airports and provide travellers and shippers more choices for destinations and routes.

Program Priority 2: Infrastructure, gateways and trade corridors (Ongoing)
Transport Canada is responsible for the implementation of the Gateways and Border Crossings Fund and the Asia-Pacific Gateway and Corridor Initiative, components of the $33 billion Building Canada Plan.

Linkage to Strategic Outcome: An efficient transportation system that contributes to Canada’s growth and trade objectives.

Priority Status: Mostly Met

Transport Canada signed contribution agreements worth over $1 billion of federal funding to support major transportation projects across Canada, one of which was
co-signed with Infrastructure Canada. The agreements included:

• $622 million under the Building Canada Fund for the Toronto York Spadina Subway Extension;
• $5 million under the Canada Strategic Infrastructure Fund;
• $54.5 million under the Gateways and Border Crossing Fund; and
• $379 million under the Asia Pacific Gateway and Corridor Initiative.

In addition to these contribution agreements, eight transportation infrastructure proposals totalling $413.5 million were announced in 2008-09 under the Gateways and Border Crossings Fund.

Program Priority 3: Innovation (Ongoing)
Transport Canada will continue to accelerate research, development, deployment and integration of Intelligent Transportation Systems.

Linkage to Strategic Outcome: An efficient transportation system that contributes to Canada’s growth and trade objectives.

Priority Status: Mostly Met

New transportation research and development and deployment projects were undertaken to enhance the transportation sector’s ability to develop and deploy new technologies:

• $3.8 million was disbursed and 25 projects were completed; and
• the Intelligent Transportation Systems Architecture for Canada was updated to reflect new technologies and services; and
• a new tool for its use and application by transportation stakeholders was developed.

Program Priority 4: Strengthened security policies and programs (Ongoing)
Strengthened security policies and programs that address emerging issues in the security environment of Canadian and international transportation.

Linkage to Strategic Outcome: A safe and secure transportation system that contributes to Canada’s social development and security objectives.

Priority Status: Mostly Met

Transport Canada:

• enhanced security through new and ongoing aviation, air cargo, marine ports and facilities and transit programs;
• improved emergency preparedness through various training exercises;
• strengthened the air passenger assessment system to better protect the travelling public; and
• enabled better information sharing with industry and other federal partners.

Program Priority 5: Streamlined regulations (Ongoing)
Streamlined safety and security regulations that support the Government’s commitment to protect and advance the public interest through a more effective, efficient and accountable regulatory system.

Linkage to Strategic Outcome: A safe and secure transportation system that contributes to Canada’s social development and security objectives.

Priority Status: Mostly Met

Transport Canada made progress towards improving harmonization and streamlining regulations and standards related to:

• marine and road safety;
• marine security;
• pilot licensing and training;
• transportation of dangerous goods; and
• approval processes for major works affecting navigation.

Program Priority 6: Safety and security management systems (Ongoing)
Safety and security management systems that effect cultural shift towards a systematic understanding and management of risk and threats.

Linkage to Strategic Outcome: A safe and secure transportation system that contributes to Canada’s social development and security objectives

Priority Status: Mostly Met

Working with government and industry partners, progress was made towards implementing safety and security management systems through formal and informal consultation, and education and awareness sessions. Safety and security research activities to increase the understanding of risks and threats across modes of transportation continue.

Other results included:

• safety management systems regulations are now in effect at Canada's ten major airports, and the remaining 312 regional airports are in the initial certification stage;
• audits were conducted at federally regulated railways on existing safety management regulations and a stakeholders’ working group was created to address the Railway Safety Act Review Panel recommendations; and
• guidelines and tools were produced to support safety management systems implementation in the marine industry.

Program Priority 7: Climate change and Clear Air (Ongoing)
Policies and programs designed to reduce greenhouse gas emissions and improve air quality by addressing smog, particulate matter and other air pollution issues that adversely affect the health of Canadians.

Linkage to Strategic Outcome: An environmentally responsible transportation system that contributes to Canada’s sustainable development objectives.

Priority Status: Mostly Met

Transport Canada supported international efforts in the aviation and marine sectors to develop standards and recommended practices for reducing greenhouse gas emissions and air pollutants. For the rail sector, the department began work on the development of emissions regulations. Transport Canada also:

• delivered a suite of programs under the ecotransport Strategy that will reduce greenhouse gas and air pollutant emissions throughout the system;
• completed the two-year ecoAUTO Rebate Program, which distributed over
  $190 million in rebates for the purchase of approximately 170,000 high-efficiency
  and alternate fuel vehicles; and
• committed $19.7 million to projects that implement emission reduction technology and practices in the freight, urban and vehicle sectors.

Program Priority 8: Environmental Assessments (Ongoing)
Environmental assessment ensures that departmental policies, programs and projects take environmental impacts into consideration at the planning stage.

Linkage to Strategic Outcome: An environmentally responsible transportation system that contributes to Canada’s sustainable development objectives

Priority Status: Met All

Transport Canada conducted 829 project environmental assessments as required by the Canadian Environmental Assessment Act and territorial land claim agreements; and identified measures to prevent, minimize, or manage adverse environmental effects. The department also conducted 88 strategic environmental assessments to identify potential impacts of proposed departmental policy, plans and programs.

Management Priority 1: People (Ongoing)
Focus on people management priorities identified in the departmental Integrated People Management Strategy, implementation of the Public Service Renewal Action Plans, pro-active staffing solutions and strengthening linguistic duality in Transport’s Canada’s services and the workplace, including employee development.

Linkage to Strategic Outcome: Linked to each departmental strategic outcome.

Priority Status: Met All

Transport Canada developed an Integrated People Management Strategy and National Staffing Strategy to address human capital needs, based on the updated National Human Resources Plan. Other results include having:

• recruited 120 post-secondary graduates – more than the target of 89;
• reached a 17.5 per cent visible minorities rate – more than the target of 12 per cent;
• played a leadership role in organizing the public service-wide Halifax Career Fair to strengthen the Public Service Brand;
• built capacity in known shortage areas through leadership and career language developmental programs;
• took a talent management approach that provides employees with a variety
  of leadership opportunities;
• automated staffing, document classification and application procedures
  (these systems are now being used by two other federal organizations); and
• made progress towards introducing an automated learning management system that will improve how the department manages employee development.

Management Priority 2: Values and Ethics (Ongoing)
Further integrate values and ethics in management practices and strengthen oversight by promoting a one-stop shop for advisory services, developing a learning strategy, informing employees of the Public Servants Disclosure Protection Act, and initiating work on a departmental Code of Conduct.

Linkage to Strategic Outcome: Linked to each departmental strategic outcome.

Priority Status: Met All

Transport Canada:

• created a departmental Values and Ethics Advisory Committee as a key component of senior management governance;
• developed a corporate Values and Ethics Plan that supports the Values and Ethics Result Framework and is tailored to the department’s mandate as a regulatory department; and
• developed a departmental Values and Ethics Risk Profile and tools.

Management Priority 3: Governance and Stewardship (Ongoing)
Develop new Program Activity Architecture and enhanced Performance Measurement Framework; Implement strengthened planning and reporting function to support effective decision-making, priority setting and resource allocation.

Linkage to Strategic Outcome: Linked to each departmental strategic outcome.

Priority Status: Met All

The advisory and decision-making capacity of Transport Canada’s executive team was enhanced because the department:

• restructured its Program Activity Architecture for 2009-2010;
• introduced a completed Performance Measurement Framework;
• established a senior executive integrated planning committee; and
• established a planning council.

1.5 Expenditure Profile

1.5.1 Departmental Spending Trend

Spending Trend for Transport Canada

Figure 1.5.1 shows Transport Canada’s expenditures (planned, authorized and actuals) from 2005-2006 to 2008-2009. The trend shows a gradual increase in actual spending from $702 million in 2006-2007, to $1,040 million in 2008-2009. The increased spending over this period is attributable to some of the department’s major initiatives including the ecoauto Rebate Program, the Asia Pacific Gateway Corridor Initiative, and the Gateways and Border Crossings Fund.

1.5.2 Voted and Statutory Items

This table shows the voted items Parliament approved through the Main Estimates with its supply bills. The statutory items are displayed for information purposes only.

($ millions)

Vote # or Statutory Item (S) 3	Truncated Vote or Statutory Wording	2006-07 Actual Spending	2007-08 Actual Spending	2008-09 Main Estimates	2008-09 Actual Spending
Vote 1	Operating expenditures	254	304	315	357
Vote 5	Capital expenditures	71	73	78	66
Vote 10	Grants and contributions	231	316	472	443
(S)	Contributions to employee benefit plans	64	66	67	67
(S)	Northumberland Strait Crossing subsidy payment under the Northumberland Strait Crossing Act	54	55	55	56
(S)	Payments in respect of St. Lawrence Seaway agreements under the Canada Marine Act	24	19	42	44
(S)	Payments to Canadian National Railway Company in respect of the termination of the collection of tolls on the Victoria Bridge, Montreal and for rehabilitation work on the roadway portion of the Bridge	2	3	3	3
(S)	Spending proceeds from the disposal of surplus Crown assets	1			3
Total 4 Department		702	836	1,032	1,040

Section II– Analysis of Program Activities by Strategic Outcome

2.1 Strategic Outcome: An efficient transportation system that contributes to Canada’s economic growth and trade objectives

2.1.1 Program Activity: Transportation Policy Development and Infrastructure Programs

Description: The Transportation Policy Development and Infrastructure Program Activity encompasses the development of transportation policies, legislation, programs, technology and infrastructure support in such a manner that competition and market forces guide the growth and development of the national transportation system and a strong and healthy marketplace encourages existing competitors and new entrants to innovate and provide new services to meet the transportation needs of Canadians. Contributing activities under the policy element of this program activity include monitoring and analysis of the Canadian transportation system, annual reporting on the health of the system, R&D, economic studies and the development of new policies. Transport Canada also administers airport, port (not including Canada Port Authorities), highway and bridge subsidy programs and performs landlord and monitoring functions for the department for ports, airports and air navigation system sites. Under the infrastructure element of this program activity, Transport Canada negotiates the divestiture of ports, and seaway lands to local interests, and operates airports and ports until their transfer, as well as federally owned airports in the Regional/Local/Remote categories and remote ports.

2008-09 Financial Resources ($ millions)			2008-09 Human Resources (FTEs)
Planned Spending	Total Authorities	Actual Spending	Planned	Actual	Difference
522	507	200	721	800	-79

Performance Indicators	Expected Results
Productivity of the transportation system Price and service levels Financial viability of the components of the system	Long-term sustainable funding and accountability framework for transportation infrastructure Strengthened international competitiveness Legislative/policy frameworks that support free market forces with targeted government intervention
Performance Status: Mostly Met

Performance Analysis

New legislation and policy frameworks in support of support free market forces and targeted government interventions were introduced in 2008-09.

Aviation. Flight Rights Canada was launched to:

• provide air travellers with more information on their rights regarding prices and services;
• remind them that they are entitled to the air carrier's terms and conditions of carriage; and
• explain the complaints procedure that is in place, ensuring carriers are held to account for their commitments.

Marine. Amendments to the Canada Marine Act along with targeted policy initiatives:

• allow Canada Port Authorities to apply for contribution funding regarding, environmental sustainability, security and capital costs related to infrastructure;
• introduce a market based borrowing regime;
• facilitate port amalgamation;
• incorporate a more responsive governance framework; and
• provide more options for Canada Port Authorities who wish to stimulate and pursue business opportunities that were previously not available to them.

Transport Canada also:

• proposed changes to the Canada Transportation Act that allow the Governor in Council to increase the limit on foreign ownership of Canadian airlines, from 25 per cent to
  49 per cent, subject to air transport negotiations;
• negotiated a comprehensive new air transport agreement with the European Union; and
• concluded or expanded bilateral air services agreements with the Dominican Republic, Costa Rica, Panama, the Philippines and Turkey.

These agreements provide air carriers and airports with new business opportunities. Travelers and shippers now have more choices in destinations, flights and routes;
more direct services; and the potential for lower fares.

All sectors. The final report of the Full Costs Investigation project was released and provides full cost estimates of the social and financial components of all modes of transportation. This information provides policy and decision makers with more
complete information on all aspects of transportation when developing policy options.

Innovation. Transport Canada continued work on an Innovation Strategy to identify measures to increase the competitiveness and efficiency of the transportation system through:

• strategic research and development initiatives;
• initiatives to enhance skills development and academic research capacity; and
• innovative technological applications, such as intelligent transportation systems.
  Significant progress was made towards developing international partnerships in key areas such as advanced technology applications, supply chain management and cooperative vehicle infrastructure systems.

Transportation infrastructure. Progress was made towards long-term sustainable funding and an accountability framework for transportation infrastructure, including highways, public transit and local roads.

Transport Canada signed contribution agreements worth over $1 billion of federal funding to support major transportation projects across Canada, one of which was co-signed with Infrastructure Canada. Transport Canada also:

• announced $413.5 million of funding for eight transportation infrastructure proposals under the Gateways and Border Crossings Fund. More information on the three gateways can be found at Gateway Initiatives.
• funded a series of in-depth analytical studies and economic research in partnership with provincial governments. These studies will inform and guide the development of the Ontario-Quebec Continental Gateway and Trade Corridor and the Atlantic Gateway.
• made progress on the project to construct the freeway that will link Highway 401
  to a new bridge between Windsor and Detroit – the busiest border point for
  Canada-United States trade. Specifically, the department announced the technically and environmentally preferred location of the new inspection plazas and bridge crossing. More information can be found at Continental Gateway.

While infrastructure remains a critical element of gateway initiatives, the Asia-Pacific Gateway and Corridor Initiative focused on longer-term strategic directions to:

• build a sustainable trade and transportation system for North America;
• optimize the supply chain for secure Asia-Pacific trade; and
• explore ways to capture the economic value associated with gateway investments.

This included working with Finance Canada towards removing tariff and regulatory barriers that limit domestic access to international marine containers. Canadian agri-food providers have identified these barriers as restricting the export of specialty agricultural products to Asian markets. This change, if made, would harmonize with United States regulations. More information on the Asia-Pacific Gateway and Corridor Initiative can
be found at Pacific Gateway.

Finally, the International Bridges and Tunnels Act regulations were published on bridge maintenance and safety and Transport Canada was instrumental in obtaining funding for:

• upgrades to VIA Rail’s equipment and infrastructure;
• repairs to the Champlain Bridge, Honoré Mercier Bridge, the Blue Water and
  Peace Bridges; and
• repairs to the federal roadway on Nun’s Island.

Performance Measurement

Aviation

• Air transportation resumed productivity gains in 2007, after a decline in 2006
  (3.7 and -3.2 per cent respectively).

Public transit

• Public transit productivity growth was slightly negative in 2007 (-0.4 per cent).

Rail

• Freight rail (Class I) continued its pattern of productivity gains with strong total factor productivity growth in 2007 (2.3 per cent).
• VIA Rail productivity growth was slightly positive once again (0.3 per cent).

Despite higher fuel prices, transportation output prices were only slightly higher overall in 2007 than in 2006, with an approximate 0.1 per cent overall increase. This occurred in part because of carriers’ productivity growth.

Benefits for Canadians

Improving the overall transportation network through strategic legislative changes, international agreements, innovation and transportation investments gives Canadian transportation service providers and shippers better access and mobility options
between mainland Canada, coastal communities and international trading partners.

Lessons Learned

Canada’s internal and external environment is constantly evolving. Supporting Canada’s economic growth in this increasingly global world, the transportation system requires close monitoring and adjustments, such as refining legislative and regulatory frameworks.

Continuous and targeted consultation with stakeholders has been important to ensuring overall success of the transportation marketplace frameworks and supporting infrastructure in Canada. Transport Canada will continue to work with other public and private organizations, academia and non-government organizations.

2.2 Strategic Outcome: A safe and secure transportation system that contributes to Canada’s social development and security objectives

2.2.1 Program Activity: Transportation Safety and Security

Description: The Transportation Safety and Security Program Activity encompasses policies, rule making, monitoring and enforcement and outreach in support of a safe and secure transportation system. The program activity develops national legislation, regulations and standards, and carries out monitoring, testing, inspection, enforcement, education, training and developmental activities to promote safety and security in all transportation modes. It also develops emergency preparedness plans
and delivers aircraft services to government and other transportation bodies

2008-09 Financial Resources ($ millions)			2008-09 Human Resources (FTEs)
Planned Spending	Total Authorities	Actual Spending	Planned	Actual	Difference
613	672	629	4,097	4,030	67

Performance Indicators	Expected Results
Level of public confidence in transportation safety and security Accident/incident rates relative to increase in traffic Fatality rates relative to accident/incident rates Progress in implementing safety and security management systems	Continuous improvement in transportation safety and security Public confidence in Canadian transportation safety and security
Performance Status: Mostly Met

Performance Analysis

In 2008-09, the department continued its efforts aimed at continuous improvement
of the safety and security of the Canadian transportation system as well as increasing
the public’s confidence in the system.

Safety and Security Management Systems

The transportation industry faces many risks and threats every day that could cause an accident or incident. Safety and security management systems are a way for the industry to proactively manage risks and threats in an effort to reduce the likelihood of accidents or incidents. They build on existing regulatory frameworks and are designed to integrate safety and security management into the daily operations of an organization.

In 2008-09, Transport Canada continued to promote safety and security management systems implementation through ongoing discussions, meetings and conferences with both internal and external stakeholders in all transportation sectors. Regulations are now in place at Canada’s ten largest airports, and the initial certification has begun at all remaining airports and air service providers (312 regional airports). Transport Canada also:

• Addressed Railway Safety Act review recommendations on strengthening safety management systems in the rail sector;
• conducted a survey for the development of a voluntary safety management system in the motor carrier sector that would be cost efficient and likely produce significant safety gains;
• engaged the marine sector in a pilot project to develop industry guidelines and tools for implementing safety management systems. The goal is to promote national consistency of safety management and ensure that Transport Canada enters into authorization agreements only with companies that have comprehensive processes to promote safety and manage risk;
• promoted security management systems through several education and awareness sessions, 21 research projects and learning activities with 15 different industry partners;
• developed criteria and guidelines for key security management system core elements to support industry and contribute to a greater systematic understanding of a management systems approach; and
• conducted research in each mode to promote, advance, and effect a culture shift towards a safety/security management systems approach.

Contribution Programs

Through various contribution funding programs, Transport Canada helps stakeholders address safety and security vulnerabilities.

Marine: Over $7 million was provided to ports and other marine facilities under the Marine Security Contribution Program, while six of Transport Canada’s simulators were upgraded and divested to provincial training institutes under the Marine Simulator Contribution Program.

Rail: The department spent $59 million under the Transit-Secure Contribution Program, resulting in 130 passenger rail and urban transit security projects. These projects improve operators’ security and emergency preparedness measures, such as employee training and physical security enhancements. Working closely with the railway companies, $7.3 million was provided under the Grade Crossing Improvement Program for safety improvements.

Road: Under the Canadian National Road Safety Vision Contribution Program, the department supported surveys, data collection, research, outreach, awareness and education activities to support partners efforts to reduce deaths and serious injuries on Canadian roads.

Harmonizing and Modernizing Regulations/Legislation; Developing Policies and Programs

In the last year, Transport Canada worked with its international partners to harmonize policies, programs and standards across the transportation system including those related to:

• air cargo and passenger screening;
• air pilot licenses;
• training; and
• language proficiency for communications with ground crews.

Transport Canada and its international partners also:

• developed international bumper testing speeds standards;
• implemented global standards for the design, manufacture, and use of portable tanks in the transportation of dangerous goods; and
• shared best practices for how to properly secure the marine transportation system.

In road safety, harmonization moved faster than expected with 15 final regulations published that will reduce the safety standards duplication between the United States and Canada.

In marine safety, Acts and Regulations were modernized consistent with the Cabinet Directive on Streamlining Regulation (i.e., the Navigable Waters Protection Act, and regulations under the Canada Shipping Act, 2001), to strengthen regulatory frameworks, address gaps in legislation, correct ambiguities, and reduce barriers with international trading partners.

With respect to transporting dangerous goods, amendments to the Transportation of Dangerous Goods Act that require companies to have security plans when transporting dangerous goods were introduced in Parliament. Amendments to the Contraventions Regulations have simplified enforcement of the Act, allowing Transport Canada inspectors to issue tickets.

With respect policy and program development, Transport Canada launched a comprehensive review of the aviation security framework in support of Budget 2009 commitments. This work, which is taking place over the next three to four years, will result in a more robust and proactive regulatory regime and remove outdated and unnecessary requirements. The department also:

• worked on the Air Cargo Security Program with federal partners and industry stakeholders, to design and pilot test the voluntary security supply chain management system that included the initiation of a compliance monitoring and inspection regime.
• implemented the Marine Transportation Security Clearance program at 11 major ports in Canada to reduce the risk of security threats and prevent unlawful interference with the marine transportation system. They are now fully compliant with the Marine Transportation Security Regulations.
• led or collaborated in a number of emergency planning activities such as the Vancouver 2010 Exercise Series, in preparation for the Olympics to assess Canada’s ability to act quickly and effectively in the event of a terrorist attack or security related threat and Exercise Nanook, to address potential crises in the North.

Performance Measurement

Safety data drawn from the latest Transportation in Canada – an Overview report (2008) (Transportation in Canada) reveals that:

In air travel, there were 232 aviation accidents in 2008, nine per cent fewer than in 2007, and 44 air fatalities, one more than in 2007. The 2008 accident rate (preliminary data) was 5.2 per cent per 100,000 hours flown, the lowest in the last 10 years.

In marine travel, the number of Canadian vessel shipping accidents and accidents aboard ships decreased for the fifth consecutive year in 2008. The 356 accidents are 16.7 per cent below the five-year average.

In road travel, the number of road casualty collisions decreased by five per cent, from 145,118 in 2006 to 138,275 in 2007. The number of fatalities as a result of traffic collisions also decreased by five per cent, from 2,895 in 2006 to 2,754 in 2007. These statistics are preliminary and subject to some change, however, the overall downward trend is not expected to change.

In rail travel, there were 1,147 reported rail accidents and 74 rail fatalities in 2008,
13.3 and 11.9 per cent fewer, respectively, than in 2007.

In the transportation of dangerous goods, there were 419 accidents in 2008, one per cent fewer than in 2007. However, only 12 injuries were directly attributable to the dangerous goods themselves.

Transport Canada was not able to evaluate its performance on the longer-term goal of the level of Canadian public confidence in transportation safety and security for 2008-2009, because of a moratorium placed on syndicated studies pending a Public Works and Government Services Canada centralized negotiation with private sector contractors.

Benefits for Canadians

Through its various projects and programs, Transport Canada helps stakeholders address their safety and security vulnerabilities, and provides the necessary tools, funds, and guidance to better mitigate safety and security risks and threats to the Canadian transportation system. This in turn builds consumer confidence and supports safe and secure communities.

Lessons Learned

The lessons learned related mainly to timeline management and accurately planning the time required for consulting stakeholders on specific policies (i.e. safety and security management systems) or regulatory initiatives. In some cases, seeking stakeholder buy-in was challenging due to the complexity of the issue and the implications for the stakeholder. To ensure the successful completion of future projects, the department will need to plan for unforeseen delays and make certain that communications during consultations remain effective.

2.3 Strategic Outcome: An environmentally responsible transportation system that contributes to Canada’s sustainable development objectives

2.3.1 Program Activity: Sustainable Transportation Development and the Environment

Description: The Sustainable Transportation Development and the Environment Program Activity encompasses the development and implementation of programs and policies to protect the natural environment and to achieve a more sustainable transportation system in Canada.

2008-09 Financial Resources ($ millions)			2008-09 Human Resources (FTEs)
Planned Spending	Total Authorities	Actual Spending	Planned	Actual	Difference
202	283	210	337	335	2

Performance Indicators	Expected Results
Percentage of Sustainable Development Strategy Targets Levels of air pollution and GHG emissions from transport Number of marine pollution incidents detected Number of Transport Canada contaminated sites remediated Number of project environmental assessments completed	Increased environmental sustainability of Canada’s transportation system and Transport Canada’s operations
Performance Status: Mostly Met

Performance Analysis

Transport Canada continued to deliver programs under the ecotransport Strategy of the Clean Air Agenda. For more information please visit ecotransport. These programs aim to:

• improve the management of sustainable transportation infrastructure in communities (ecomobility program);
• increase efficiency and reduce emissions of air pollutants and greenhouse gases from the movement of goods (ecofreight program, Marine Shore Power Program); and
• improve fuel efficiency and reduce emissions from the personal vehicle fleet (ecotechnology for Vehicles, ecoauto Rebate Program).

The department is also building strong impetus for developing and applying emission-reducing technologies and increased knowledge and engagement in green transportation opportunities. More comprehensive results are provided in the “Horizontal Initiatives” table on Treasury Board Secretariat’s website.

Under the Clean Air Regulatory Agenda and the ecoTransport Strategy, Transport Canada also pursued a number of initiatives across the entire transportation system
to further minimize the impact of transportation on the environment.

Road. The Government of Canada and the Canadian automobile industry continued to support implementation of the 2005 Memorandum of Understanding to act on climate change (under this agreement carmakers will voluntarily work to reduce annual green house gas emissions from light-duty vehicles by 5.3 megatonnes in 2010).

Transport Canada continued its membership role on the Government/Industry Memorandum of Understanding Committee and helped develop a performance measurement framework. The department provided Natural Resources Canada with data relating to vehicle sales and fuel consumption for use in the analysis of performance under the MOU. For more information, please visit: Natural Resources Canada.

Transport Canada prepared discussion and consultation papers as part of a 2006 Government of Canada commitment to develop vehicle fuel consumption regulations. In 2009, the government decided to meet its objectives through regulations pursuant to the Canadian Environmental Protection Act, 1999 under the authority of the Minister of Environment, to ensure that Canada has the flexibility to align with fuel efficiency standards in the United States.

Rail. The department continued to support the implementation of the Memorandum of Understanding with the Railway Association of Canada. This agreement:

• establishes a framework for reducing air pollution and green house gas emissions from railway locomotives operated by Canadian railway companies in Canada;
• aligns railway practices with United States air pollution standards; and
• ensures that the rail industry continues to improve its greenhouse gas emission performance between 2006 and 2010.

Other results included starting to develop rail emission regulations that will take effect in 2011, once the current Memorandum of Understanding expires.

Marine. Transport Canada supported the International Maritime Organization in developing standards and recommended practices for reducing greenhouse gas emissions and air pollutants caused by ships. This included the submission of a joint Canada/United States application to establish an Emission Control Area in North America for the marine sector.

Other results included introducing amendments to the Marine Liability Act in Parliament. This Bill supports the ratification of two international conventions that would significantly improve the liability and compensation regime for pollution damages caused by marine oil spills.

Amendments to the Arctic Waters Pollution Prevention Act were also introduced in Parliament. The amended Act enables Canada to apply its strict requirements for Arctic shipping over a greater area, which will better protect our Arctic waters from pollution.

Air. Transport Canada worked with the International Civil Aviation Organization to develop standards and recommended practices for reducing greenhouse gas emissions and air pollutants. Transport Canada also:

• represented Canada at meetings of the Group on International Aviation and
  Climate Change;
• began work with the Canadian Airports Council to implement Air Quality Management Plans; and
• continued to support the Memorandum of Understanding with the Air Transport Association of Canada, the first of its kind in the world, that aims to reduce greenhouse gas emissions from aviation sources. It sets an annual fuel efficiency target that will achieve a cumulative reduction in emissions of 24 per cent by 2012 relative to 1990 levels.

All sectors. Transport Canada contributed to ‘whole of government’ procedures, guidance and project agreements to govern the environmental assessment and regulatory review of 42 major resource projects (such as mining, oil and gas, pipelines, nuclear facilities) being coordinated through the Major Projects Management Office. Transport Canada is applying these procedures to other major transportation projects to streamline the regulatory review process while continuing to protect the environment. These are important initiatives related to the government’s commitment to more efficient and effective review processes.

Performance Measurement

Sustainable Development Strategy: Most of the targets were met or are on track, as provided in the “Horizontal Initiatives” table on Treasury Board Secretariat’s website.

Air Pollution/Greenhouse Gases: Greenhouse gas emissions from the Canadian transportation sector rose 14 per cent between 2000 and 2007 (from 166.8 to 190.2 Mt CO2eq), mainly due to population growth, economic activity and resulting vehicle use. Air pollution emissions continue to show a steady decline between 2000 and 2006, due
to regulatory initiatives and stock turnover. In particular, sulphur oxides decreased by 12.2 per cent, nitrogen oxides decreased by 10.9 per cent; fine particulate matter decreased by 12.1 per cent and volatile organic compounds decreased by 23.2 per cent. Further information is available at Transportation in Canada. Transport Canada has reduced greenhouse gas emissions from its operations (buildings and transportation) for the 2007-08 fiscal year by 17 per cent relative to 1998-1999 levels.

Marine: 183 marine pollution incidents were detected, with 164 classified as mystery spills, and 19 reported as having originated from a ship.

Contaminated Transport Canada sites:

• 242 of 526 have undergone or are undergoing remediation or risk management; and
• 90 sites have now been removed from the Transport Canada contaminated sites inventory.

Environmental Assessments: A total of 829 project environmental assessments were conducted as required by the Canadian Environmental Assessment Act and territorial land claim agreements. Measures to prevent, minimize, or manage adverse environmental effects of such projects were identified. The department also conducted 88 strategic environmental assessments to identify any potential environmental impacts of proposed policy, plans, and programs.

Benefits for Canadians

Work in this Program Activity focused on developing and implementing policies and programs to protect the natural environment, create a more sustainable transportation system in Canada and ensure environmental stewardship of Transport Canada’s assets and operations. As a result, Canadians will benefit from cleaner air, land, and water that will help to protect their overall health.

Lessons Learned

Since the North American transportation industry is so integrated, some regulatory development depends on developments with our major trading partners, including the United States. The department recognizes the need to coordinate timelines and the development of policy and regulatory actions to continue to meet Government of
Canada objectives.

Coordinating a ‘whole of government’ project management approach to conducting environmental assessments and regulatory review delivers important process efficiencies while ensuring that environmental impacts are considered effectively in the planning stages of transportation-related projects.

A continued area for improvement relates to data and analytical capacity. The department will continue to work with its federal, provincial and territorial partners on improving data gathering and tools to support policy and program development.

SECTION III – SUPPLEMENTARY INFORMATION

3.1 Financial Highlights

The financial highlights presented within this DPR are intended to serve as a general overview of Transport Canada’s financial position and operations. The Department’s financial statements can be found on Transport Canada’s website at:
http://www.tc.gc.ca/eng/corporate-services/finance-fs-637.htm.

(in thousands of dollars)

Condensed Statement of Financial Position At End of Year (March 31, 2009)	% Change	2009	2008
Total Assets	-5.3%	3,007,535	3,176,364
Total Liabilities	-1.3%	1,941,940	1,966,577
Total Equity	-11.9%	1,065,595	1,209,787

(in thousands of dollars)

Condensed Statement of Operations At End of Year (March 31, 2009)	% Change	2009	2008
Total Expenses	19.8%	1,622,621	1,354,903
Total Revenues	-9.1%	406,311	446,860
Net Cost of Operations	33.9%	1,216,310	908,043

Text version - Assets by Type

Total assets were $3,008 million at the end of 2008-09, a decrease $169 million (5.3%) over the previous year’s total assets of $3,176 million. Tangible capital assets represented the largest portion of total assets at $2,805 million or 93.3% of total assets.

Text version - Liabilities by Type

Total liabilities were $1,942 million, a decrease of approximately $25 million (1.25%) over the previous year’s total liabilities of $1,967 million. Accounts payable represents the largest portion of liabilities at $953 million or 49% of total liabilities.

Text version - Revenues

The Department’s total revenues amounted to $406 million for 2008-09. There was a decrease of $41 million (9.2%) from the previous year’s revenue. Most of Transport Canada’s revenue was derived from Transportation Policy development and infrastructure programs.

Text version - Expenses

Total expenses for Transport Canada were $1,623 million in 2008-09. The majority of funds, $777 million or 47.9%, were spent in Transportation safety and security; while Transportation Policy development and infrastructure programs represented $620 million or 38.2% of total expenses.

3.2 List of Tables

The following tables were submitted electronically. The electronic tables can be found on the Treasury Board Secretariat’s website at:
http://www.tbs-sct.gc.ca/dpr-rmr/st-ts-eng.asp.

Details on Transfer Payment Programs

Sources of Respendable and Non-Respendable Revenue

User Fees/External Fees

Horizontal Initiatives

Sustainable Development Strategy

Green Procurement

Response to Parliamentary Committees and External Audits

Internal Audits and Evaluations

3.3 Other Items of Interest

A

Advisory Panel’s Review of the Canadian Air Transport Authority Act
http://www.tc.gc.ca/tcss/CATSA/Final_Report-Rapport_final/final_report_e.htm

Airport Capital Assistance Program
http://www.tc.gc.ca/programs/Airports/ACAP/menu.htm

All Aboard: Rail Safety Strategic Plan (2005-2010)
http://www.tc.gc.ca/RailSafety/Publications/StrategicPlan.htm

Asia Pacific Gateway Corridor Initiative
http://www.tc.gc.ca/canadasgateways/apgci/index.html

Automakers Agreement to Reduce GHG Emissions
http://www.oee.nrcan.gc.ca/transportation/ghg-memorandum/index.cfm

C

Cabinet Directive on Streamlining Regulation
http://www.reglementation.gc.ca/directive/directivetb-eng.asp

E

Ecotransport Strategy
http://www.ecoaction.gc.ca/ecotransport/index-eng.cfm

F

Flight Rights Canada
http://www.tc.gc.ca/flightrights/menu.htm

G

Gateway
http://www.canadasgateways.gc.ca/index2.html

O

Ontario-Quebec Continental Gateway
http://www.continentalgateway.ca/index2.html

Organizational structure
http://www.tc.gc.ca/aboutus/department/menu.htm

S

Statutes
http://www.tc.gc.ca/acts-regulations/acts/menu.htm

T

Transportation in Canada - Overview report (2008)
http://www.tc.gc.ca/policy/report/aca/anre2008/index.html

Transport, Infrastructure and Communities portfolio
http://www.tc.gc.ca/aboutus/abouttic.htm

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1. For program activity descriptions, please access the Main Estimates online http://www.tbs-sct.gc.ca/est-pre/estime.asp

2. The accident rates and the number of fatalities for 2008 are preliminary.

3. Statutory payments of less than $1 million were not included on this chart.

4. Due to rounding, columns may not add to the totals shown.