DAILY NEWS Dec 11, 2012 12:04 PM - 0 comments

CN chief calls federal rail service bill unnecessary, overly burdensome

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MONTREAL, Que. -- CN president and CEO Claude Mongeau says that outside of normal operational and commercial issues, there is no evidence of systemic rail service performance problems in Canada warranting the federal government's introduction of legislation this morning that will impose level of service obligations on railways through increased regulation.

Mongeau pointed to Canada’s “world-class rail system, one known internationally for efficiency and reliability” as evidence that the rail service bill is unwarranted. He also noted that CN has “addressed every recommendation” from the federal government's 2008 Rail Freight Service Review (RFSR) panel to improve service, including entering framework cooperation agreements with an array of stakeholders and level of service agreements with many customers “to increase supply chain collaboration and deepen customer relationships.”

“Jim Dinning, while heading the RFSR's railway-shipper facilitation process, recognized this fact, saying in his report that commercial forces were already driving improved rail service and advising the government that shippers should take advantage of the improved customer focus of the rail industry,” said Mongeau in a release this morning.

Mongeau further said he was “troubled” by the government’s decision to introduce legislation that is “inconsistent with the facts underscoring improved rail service,” adding that “the legislation sends “mixed signals to customers and suppliers around the world about the government's approach to commercial markets in Canada.”

“CN invites the government to identify specific, systemic service issues that warrant this legislation,” Mongeau said. “We are ready to address any legitimate problems brought to our attention, in the same way we addressed all the commercial recommendations of the RFSR panel. We will continue to make our case that a commercial framework for the rail industry is what Canada needs to foster prosperity.”  

Mongeau concluded that “Canada should not put the commercial framework of its rail system at risk through unnecessary and overly burdensome rail regulation,” saying it will “stifle innovation, chill the positive service momentum that's taken hold and result in potentially unintended consequences for the rail industry and the customers we serve.”

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