Federal budget includes focus on supply chain

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by Emily Atkins

The 2023 federal budget takes measures to address supply chain challenges.

The measures included are described in the budget document as a “down payment on Canada’s National Supply Chain Strategy,” which the government promises will be released in the coming months. It will be informed by the recommendations of the National Supply Chain Task Force report.

New office at Transport Canada

As part of the new spending, Transport Canada will have $27.2 million over five years, starting in 2023-24, to establish a Transportation Supply Chain Office. It will work with industry and other orders of government to respond to disruptions and better coordinate action to increase the capacity, efficiency, and reliability of Canada’s transportation supply chain infrastructure.

This includes collaborating with industry, provinces, territories, and Indigenous Peoples to develop a long-term roadmap for Canada’s transportation infrastructure to better plan and coordinate investments required to support future trade growth.

The Freight Management Association of Canada’s president John Corey said in an email interview this is something shippers have been asking for. The office will “hopefully improve communication and understanding of the supply chain’s importance to all government departments, something that currently not apparent,” Corey said. He cautioned, however, that the danger it is will simply add a new layer of bureaucracy.

Data collection

Transport Canada and Statistics Canada will work together to improve transportation supply chain data to help reduce congestion, improve efficiency, and inform future infrastructure planning. The budget allocates $25 million over five years, starting in 2023-24, for this work.

Amendments to the Canada Transportation Act will support data collection efforts by providing the Minister of Transport with the authority to compel data sharing by shippers accessing federally regulated transportation services.

Competitiveness

The budget also proposes a temporary extension, on a pilot basis, of the interswitching limit in the prairie provinces to strengthen rail competition. Corey said extended interswitching was a key shipper recommendation in the National Supply Chain Task Force report, and is thus welcome. “Unfortunately the measure is temporary and limited geographically, but the hope is it will eventually become a permanent extension of the limit and made available to shippers across Canada,” he said.

The Shipping Conferences Exemption Act will be reviewed to improve marine shipping competition. In March 2022, a group of six shipper associations, including the FMA, submitted a report to Transport Canada and the Competition Bureau, setting out the harm done to Canadian ocean shippers by the ocean carrier alliances.

According to Corey, the group is pleased to see the pending review of the act. “This act … encourages anti-competitive ocean carrier behavior and we believe no longer allows shippers a vehicle to complain about poor service and abusive rates,” he said.

Ongoing infrastructure projects

The budget document also highlighted ongoing and pending supply chain infrastructure projects being funded under the National Trade Corridors Fund, including $60 million to the Prince Rupert Port Authority to increase rail capacity; $40 million to Nunavut for the construction of a new deep-water port in Qikiqtarjuaq; $50 million to the Montreal Airport Authority to improve air freight logistics at the Montreal-Mirabel International Airport; $100 million to the Edmonton International Airport for the construction of a new 2,000-acre cargo hub; $13.8 million to the Hamilton Oshawa Port Authority for new infrastructure investments; and, $90 million to Nova Scotia for the twinning of Highway 104.