News & Updates

    The Morning Brief - 06.11.19

    Posted by Bruce Carson on Jun 11, 2019 8:55:10 AM


    Economy—Bill C-48, tanker ban and Bill C-69, no more pipelines, Update


    Bills C-48 and C-69, Update

    There are two more sitting weeks left for the House of Commons, due to rise for the summer recess on Friday, June 21 and then overtaken by an election call for a voting day in October. There seems less urgency now to recall the Senate and the House for a summer session to pass the bill that would implement the new NAFTA deal, the USMCA. If Canada’s progress on implementation is to follow along the same track and at the same pace as the United States, then it will be after the election before that bill is taken up for discussion in a new parliament.

    All of this to say, legislative time is tight and it is difficult to say how much will be devoted to these two bills in the House of Commons. Another matter that should be considered is the cabinet meeting set to take place a week from today and it is supposed to have a decision on the Trans Mountain pipeline on its agenda. Nothing has been said by Natural Resources Minister Sohi to contradict this information.

    So there are three balls in the air right now of vital importance to energy producing provinces and to the future of the Canadian economy; Bills C-48 and C-69 and a pending cabinet decision on a pipeline.  A decision on the pipeline which would allow it to be constructed is even more important now, given hurdles in the approval process for Enbridge Line 3 and Keystone XL and the fact that construction of both has, once again, been delayed.

    Perhaps the best way to approach the two bills is to deal with their present status and then fill in with the background as to how they got to this point and possible future.

    Bill C-48 remains at Third Reading stage in the Senate, the report from the Senate Transport Committee which would have killed the bill, itself having been defeated in the Senate. There still seems to be willingness on the part of Conservative opposition Senators and some from the Independent Senators Group (ISG) to amend the bill by perhaps delineating a corridor for shipping off the north-west coast of B.C. and/ or provide for the automatic review of the bill at a time certain in the future.

    Transport Minister Garneau has indicated that the government is not interested in the delineation of a shipping corridor, but might look favourably upon an automatic review mechanism.

    If attempts to amend C-48 are successful, it will go back to the House of Commons for further deliberation. If attempts to amend it are unsuccessful, it may then pass through the Senate and be sent on for Royal Assent. The disposition of the bill should become clear this week.

    Bill C-69 is back in the House of Commons carrying approximately 200 amendments brought to it by the Senate Energy Committee. The Trudeau government will decide which ones it will accept, there will be debate, but ultimately because this is a majority government, the bill with amendments scaled back will be returned to the Senate for further deliberation. This process should take the better part of this week and could spill over into next week and run up against the cabinet decision on the pipeline.

    The conventional wisdom seems to be that the government wants these two bills, with few amendments and in return it will provide cabinet approval for the Trans Mountain pipeline. Cabinet approval, of course, doesn’t mean it will be built, but it is a necessary first step, taken once again.

    The legislative revision of both bills in the federal parliament is taking place in spite of pressure first from all political leaders in Alberta and yesterday in the form of a letter from six premiers to the prime minister, warning of dire consequences to national unity should both bills be passed without significant amendments.

    At the end of May, a letter from all political party leaders in Alberta was sent to the Government’s Representative in the Senate, Peter Harder to the effect that an unamended C-69 would threaten Alberta’s exclusive jurisdiction over its resources. The letter also supported killing C-48.

    Then at the beginning of June, former Saskatchewan premier Brad Wall wrote an opinion piece published in the National Post entitled “Want a Unity Crisis? Pass C-69 and C-48 into Law.” Wall wrote “if C-69 is dry kindling to the flames of Western alienation, then C-48 is carbon taxed lighter fluid.” With regard to C-48, he notes that industry groups, regulatory lawyers and First Nations are against it. The bill does not correct uncertainty, it invites new litigation. C-69 is described as adding legal requirements, new consultative obligations, discretionary decrees and the elimination of previous precedents as the National Energy Board is scuttled.

    Yesterday, a letter was sent to the prime minister signed by 6 premiers representing Ontario, New Brunswick, Manitoba, Alberta, Saskatchewan and the North West Territories saying that Bills C-48 and C-69, passed as originally drafted represent a threat to national unity. 

    It read, C-69 “as originally drafted would make it virtually impossible to develop critical infrastructure, depriving Canada of much needed investment.” C-48 “threatens investor confidence and the tanker moratorium discriminates against western Canada crude products.” The letter went on to say the “federal government appears indifferent to the economic hardships faced by provinces.”

    The letter concluded with “immediate action to refine or eliminate these bills is needed to avoid further alienating provinces and their citizens and focus on uniting the country in support of Canada’s economic prosperity.”

    This theme of threats to national unity can be found in the committee report on Bill C-48 and in the comments of Alberta’s Energy Minister Sonja Savage. On C-48, she is quoted as saying “there’s some who may want to fix it, but you can’t fix that bill.” She went on to say that if it is passed Alberta will file a constitutional challenge. “This bill is aimed directly at Alberta. It land locks us from getting products to market.”

    The question for the Trudeau government as it always seems to be these days, is a political one. Will cabinet approving Trans Mountain be a sufficient trade off so that the Trudeau government can allow both C-48 and C-69 to pass virtually unamended and still appeal to environmentalists as well as to those want a pipeline? Is there a middle ground that the Trudeau government can occupy? Or will it have to kill or postpone a decision on the pipeline in addition to allowing the bills to pass unamended to shore up its green credentials?

    Yesterday’s banning of plastic straws announcement with few details and moveable timeline for implementation may demonstrate to some that the Grits are concerned about a rising Green tide. This hastily put together announcement, at least it seemed that way, had the prime minister explain that cardboard drinking bottles and juice boxes would be ideal substitutes for single use plastics. Also surprising in the run-up to the October election, is how little attention is being paid to the NDP when compared to the approach of the 2015 election. 

    Decisions will be made in the next couple of days by the federal government regarding these three balls in the air based on electoral consequences for the Liberal Party, and perhaps a sprinkling of the ‘public good’ that will flow, from each decision.

    To Come

    --today through Thursday, Global Petroleum Show in Calgary

    --June 13, new housing price index for April to be released

    --June 18-19, U.S. Fed meets 

    --June 18, decision by federal cabinet on the future of the Trans Mountain pipeline

    --June 19, CPI numbers for May to be released--bc

    Topics: Morning Brief

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