Western Canadian Grain Transportation and the Maximum Revenue Entitlement: Process, Design Considerations and Final Implementation

The transportation of Western Canadian grain and the role of federal rate regulation have a long and well-documented relationship that reaches back to the settling of Western Canada and the establishment of the Crows Nest Pass Agreement in 1897. The ‘crow rate’ and its statutory freight rates was later formalized in 1927 and remained static for almost nine decades, until November 1983 when it was superseded by the Western Grain Transportation Act (WGTA), which took effect January 1, 1984 and the era of the ‘crow benefit’ subsidy and the setting of more compensatory maximum freight rates.1 The WGTA was repealed in 1995 and the Canada Transportation Act took effect on July 1, 1996, bringing an end to direct transportation subsidies but continuing the government’s role in setting maximum freight rates. In a reaction to a period of grain transportation difficulties experienced in 1995-96, an intense period of focus, investigation and consultation on the state of the Western Canadian grain handling and transportation system (GHTS) would be launched by government. The result of this two years of work would culminate in several months of frenetic policy and legislative activity that moved the regulatory framework governing the GHTS to less regulated (but by no means complete) and more commercialized environment. This paper surveys the way in which decades of economic regulation of the GHTS, specifically rate setting regulations in the form of the maximum rate cap gave way to the Maximum Revenue Entitlement (MRE) regulation at the turn of the last century. Specific consideration is given to the way in which the specific recommendations of the Estey Report (1998) and the Kroeger Report (1999) on this issue were viewed by the government of the day and would ultimately culminate in Bill C-34, that amended the Canada Transportation Act and implemented the final form of the MRE on August 1, 2000.

Language

  • English

Media Info

  • Media Type: Web
  • Pagination: 1 PDF file, 114 KB, 8p.
  • Monograph Title: Canadian Transportation Research Forum 52nd Annual Conference - Canadian Transportation: 150 Years of Progress//Les transports au Canada : 150 ans de progrès - Winnipeg, Manitoba, May 28-31, 2017

Subject/Index Terms

Filing Info

  • Accession Number: 01678271
  • Record Type: Publication
  • Source Agency: Transportation Association of Canada (TAC)
  • Files: ITRD, TAC
  • Created Date: Aug 22 2018 1:41PM