Sure. As we indicated, the objective of our reviewing of the liability and compensation regime first was to make sure that we have “polluter pay”. That's where we started with this whole piece. We also wanted to make sure that there would be adequate resources available for potential victims or for cleanup costs to make sure that taxpayers were going to be protected in the event of an accident.

But we had to make sure that it was a fair sharing; it's not just railways that are involved. Shippers are to be involved as well. That's how we ended up coming up with the bill that's before you and the insurance requirements.

On the first side, with respect to the railways, it was to determine the appropriate level of insurance, because what happened in the case of Lac-Mégantic was that there was only $25 million available, and to review what are the appropriate levels of insurance, which was done. Second was to take a look from the other side as well, at a second source of compensation, which would be this fund for railway accidents involving designated goods. We determined to start this with crude for various reasons, including the fact that it is an increasing source, but the initial focus is not just for that. It's because we know exactly what happened in the Lac-Mégantic derailment and we saw what costs were associated with it. As crude is not the only product that could cause damage in the case of a rail accident, it is left open, and there is flexibility there to provide, by regulation, other dangerous goods in the future.

The administration would require establishment of a body, but we've been doing that already, as I've said, in the shipper finance fund, the ship-source oil pollution fund under the Marine Liability Act, and there are a lot of similarities. We've mirrored those responsibilities with regard to both fund management and accountability.

We're going to start with crude oil. Railways are going to be required to pay compensation to the limit of their insurance level without the need to prove fault or negligence. We are also making sure that we take into consideration the things that are beyond their ability. I've listed those already previously in answer to a question. As well, regulatory authority is there to include things other than crude oil with respect to the railway. To make sure there's continuity, damages covered by the fund would mirror those for which railways would be held liable, for all loss or damage.

We've indicated how we would go ahead and capitalize the fund. We figured that the best way to do that would be a per tonne levy. It was, as Mr. Tupper pointed out, a straightforward exercise in determining what that level of levy would be. We said that the shippers would be required to pay the levy to the railways and then the railways would remit it to the government for a deposit in a special account as part of the CRF. As we've gone through already, the fund will be the payer of last resort, because most accidents will be covered by those mandatory insurance levels. There will be a few.... God willing, we won't have any accidents, but there may be a few that would end up tapping into the fund. If that fund is depleted by that accident, then the CRF would be called upon as a backstop.

That's basically a longer version of what I said in the speech and how I've answered with respect to these questions in the past. We want to make sure that the fund is transparent in its management, so the administrator would report on the management of the fund to Parliament through the Minister of Transport. There would be provision for a special examination of the fund at least once every five years as well.

That's it in a nutshell.

Lisa Raitt

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