Bureaucrats stand in way of restoring Churchill line: Axworthy

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This article was published 14/09/2017 (2946 days ago), so information in it may no longer be current.

OTTAWA — A longtime proponent of the rail line to Churchill says federal bureaucrats have always thwarted its progress, amid recent allegations Transport Canada has delayed Ottawa’s moves to get the line into local hands.

Lloyd Axworthy, a former Liberal cabinet minister, said getting any funding for the Hudson Bay Railway has meant fighting with the public service. 

“It was kicking and screaming all the way,” he said. “Don’t get me started. There has always been a series of strong push-backs, and (Department of Transport) was one of the most difficult.”

This week, Assembly of Manitoba Chiefs Grand Chief Arlen Dumas, and others close to the rail line talks, told the Free Press bureaucrats have been giving “deliberate misinformation” to the Prime Minister’s Office, whose officials are much more enthused about transferring ownership of the damaged transportation link to two northern Manitoba groups.

Axworthy said those allegations ring true. “There was such an anathema in certain parts of Ottawa, including (the Department of transport).”

Negotiations were ongoing Wednesday, as former public service head Wayne Wouters figures out how much Ottawa is willing to pay to take the rail line from Denver-based owner Omnitrax.

A source familiar with the negotiations said Transport Canada has been providing Wouters with a drastically lower number than Omnitrax’s evaluation.

The source, who is not authorized to speak with media, said Omnitrax imagines it would earn as much as $30 million in the unlikely event it declared bankruptcy for the Hudson Bay Railway and salvaged the steel tracks for parts.

Transport Canada, according to the source, believes the line is actually a $15-million burden, possibly due to costs associated with repairs.

Neither Omnitrax nor Transport Canada would give the Free Press their estimates, nor their methods for assessing the rail line’s financial value.

Omnitrax’s Canadian head, Merv Tweed, a former Tory MP for Manitoba, wrote that talks are moving slowly: “We have had some productive discussions, but time is running out and we hope to see negotiations accelerate.”

Transport Canada says it’s been “actively engaged to provide the Government with the best advice possible towards finding a whole-of-government resolution,” according to spokeswoman Marie-Anyk Côté.

She said Transport and other departments are helping “to deliver on the government’s commitment to support the restoration or rail service.” The department says it’s also prioritized maintaining air and marine transporation, including helping the province ship gas to the town in case nothing is resolved before freeze-up.

Dumas said he came across similarly different numbers from both sides in Missinippi Rail’s two-year effort to acquire ownership of the line.

“Those assets are priceless,” he said. “The way I look at it is the human cost of being able to feed ourselves and transport ourselves.”

Dumas laments taxpayers being on the hook, but said Omnitrax shouldn’t have taken over the line, which the company purchased in 1997.

“At the end of the day, it’s going to cost money to get rid of these guys and, unfortunately, it’s the government who is going to have to pay.”

However, Axworthy said he empathizes with a late-July statement from Omnitrax, that three major setbacks have prevented it from holding up its end of the deal.

At the time, the company cited the unprecedented flooding this spring, the province shuttering its Churchill Gateway Development Corp. in 2015, and the 2012 federal stoppage of the Canadian Wheat Board monopoly (which controlled grain sales and brought steady traffic to the line and the now-shuttered Port of Churchill).

Axworthy, who was involved in Ottawa’s 1997 transfer of the rail line to Omnitrax, said his government chose the American company because it agreed to maintain service to Indigenous and northern communities.

“We couldn’t find anybody here who can take on any role, and that’s why we cut the deal with Omnitrax,” he said.

“To assume or agree that this was just a purely commercial operation, was not the premise upon which this agreement was made.”

Meanwhile, Axworthy said Transport Canada’s disregard for the line has remained steady, even in his recent role as chairman of the development corporation.

He said Transport Canada wouldn’t provide an icebreaker or help with navigation studies to promote the port. “They’re closely tied to shipping interests down east. They really like to keep the east-west flow, and I think they think of Churchill as a competitor,” Axworthy said.

He recalls a 2010 summit he organized at the University of Winnipeg, which attained international interest but “was shot down by a senior public official in the Department of Transport.”

Axworthy said the estimated $43.5-million cost to restore service along the line into Churchill is a small dent in Ottawa’s finances.

“It needs upgrading and modernizing, no question. But it’s already there,” he said. “Instead of having to grind it out grudgingly, I think it should be seen as a real opportunity

He noted other countries are establishing Arctic ports. “The Russians spent a billion rubles upgrading Murmansk, and while we’re arguing over $40 million?”

dylan.robertson@freepress.mb.ca