CALGARY AB: The Western Canadian Wheat Growers Association is pleased the federal government has taken legislative action to improve accountability in rail service for grain and other commodities.
“These measures will create the conditions for improved railway performance and accountability,” says Kevin Bender, President of the Wheat Growers. “It will help ensure all shippers can gain access to an adequate level of service.”
The legislation requires the railways to provide shippers with service agreements. While the specific terms of each agreement will differ, the railways will be required to provide commitments regarding the level of service that each shipper can expect to receive. The legislation provides for an arbitration process in those cases where a shipper and a railway are unable to negotiate a service agreement on their own.
The Fair Rail Freight Service Act will help address the one-sided nature of rail service accountability that exists today. Currently the railways impose penalties on shippers if trains are not loaded on time, however no penalties are imposed if a railway fails to spot or pick-up trains on time.
“Performance clauses are a standard part of commercial contracts,” says Bender. “Introducing such provisions in railway service agreements will help re-balance and normalize the business relationship between shippers and railways.”
The Wheat Growers note the penalty clauses in any negotiated service agreement will never be invoked if railways and shippers honour their service commitments.
“These are good backstop provisions,” says Bender. “The railways have nothing to worry about if they provide satisfactory levels of service.”
The Wheat Growers commend the federal government, and in particular Transport Minister Denis Lebel and Agriculture Minister Gerry Ritz for spearheading this forward-thinking legislation.
“This legislation provides the Canadian grain industry with the tools to be a more efficient and reliable supplier,” says Bender. “It puts us in a better position to capture the growing market opportunities for our grain and grain products, here at home and abroad.”
About the Wheat Growers:
Founded in 1970, the Western Canadian Wheat Growers Association is a voluntary farmer-run advocacy organization dedicated to developing public policy solutions that strengthen the profitability and sustainability of farming, and the agricultural industry as a whole. For more information, please visit wheatgrowers.ca.
For More Information Contact:
Kevin Bender, President