PORT DIVESTITURE PROGRAM
The 1995 National Marine Policy outlines the Government of Canada's plan to modernize Canada's marine transportation system.
The public port system supports the safe and efficient movement of vessels and cargo that is so important to many of Canada's regional economies. In its Port Divestiture Program, Transport Canada transfers the ownership and operation of regional/local ports and harbour beds to other federal departments, provincial governments, community organizations or local interests.
This transfer puts the ports in the hands of those who can make good decisions based on local needs. This results in a more effective and efficient port system with local accountability. The new owners have the same rights and obligations of any property owner and must obey all laws that apply to them.
As of March 31, 2007, 469 of the 549 sites identified at the start of the program (85 per cent) are no longer under Transport Canada's control. This has saved Canadian taxpayers more than $270 million. In Budget 2007, Canada's New Government approved keeping the program active until March 31, 2012.
Under the Port Divestiture Program regional/local ports and harbour beds owned by Transport Canada, are offered first to other Government of Canada departments and then to the provinces. If the province is not interested, Transport Canada then looks to local stakeholders, including municipalities, for expressions of interest. A public tender may be used if no expressions of interest are received.
A Port Divestiture Fund exists to make the transfer process easier for new owners. It provides funds for local interests to assume ownership and operate in local business conditions. This money must be used directly for port operation or for bringing existing port property up to minimum safety or operating standards.
The Port Divestiture Program is effective and efficient because:
- Contribution agreements are always audited.
- Port operators are required to provide the Minister with proof that the funds have been used directly for port operations, each year of a contribution agreement.
- Port operators are required to open their books and records for audit and inspection at the discretion of the Minister of Transport during, and for six years after the end of, the contribution agreement.
- Transfer documents call for full repayment if, for example, the port operator stops port operations.
Under the National Marine Policy, most of Canada's ports were classified as regional/local. However, the policy also includes two other categories not covered by the Port Divestiture Program:
- Canada Port Authorities (CPAs): These 19 ports are vital to domestic and international trade, financially self-sufficient and independently managed by boards of directors nominated by user groups and various levels of government. CPAs are governed by the Canada Marine Act (CMA), which enables them to operate in a more commercial, efficient and timely manner.
- Remote ports: These 26 ports serve basic transportation needs of isolated communities and rely on the presence of an existing Transport Canada wharf structure. Remote ports will continue to be operated by Transport Canada unless local groups express an interest in acquiring them.
While Transport Canada is transferring its property interests in regional/local ports, the Government of Canada still controls marine traffic. This means that no matter who owns the port, ships must still obey all federal laws such as the Navigable Waters Protection Act and the Canada Shipping Act.
July 2007
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