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Minister’s Message

As Minister of Transport, Infrastructure and Communities, I am pleased to present to Parliament Transport Canada’s Report on Plans and Priorities for 2012-2013.

Over its 75-year history, Transport Canada has played a key role in addressing the evolving needs of transportation in Canada. We at Transport Canada are proud of the solid foundation that has been laid, and we are confident that the department will be able to ensure a transportation system that is accessible, safe, secure, efficient, environmentally responsible, and most of all, ready for the future.

Looking forward, in 2012-2013, we will:

• refine and strengthen Transport Canada’s oversight function to improve transportation safety and security;
• help make Canada’s critical transportation infrastructure safer and more efficient;
• finalize Transport Canada’s renewed policy framework;
• support the department’s workforce and workplace through the impacts of change initiatives; and
• continue to strengthen departmental management controls and practices.

By delivering on these priorities, Transport Canada will contribute directly to the success of three key government-wide initiatives: supporting economic growth; protecting the security and safety of Canadians; and serving Canadians in a way that continues to ensure their ability to travel.

We will continue to refine and strengthen our oversight function. To achieve this, we will establish better processes to assess and manage risk; focus oversight resources on areas of highest priority; and provide improved tools and training to personnel. Further, finalizing the transformation initiatives that are underway in our Aviation Safety Program will allow us to address immediate opportunities for oversight improvement identified by both our employees and stakeholders.

We will draw on our knowledge, experience, and input from our experts and stakeholders to renew the department’s policy framework. This will ensure that our policies, programs and regulations meet the needs of the transportation system over the next 10 to 15 years.

Building on the Government of Canada’s unprecedented investments in transportation infrastructure, Transport Canada will continue to help make Canada’s critical transportation infrastructure safer and more efficient by improving the flow of goods, services and people. This includes starting construction of the new Windsor-Detroit crossing and planning a new bridge over the St. Lawrence River in the Greater Montreal area.

I would like to thank the entire staff for their efforts and hard work. As Minister of Transport, Infrastructure and Communities, I am confident that the department will meet its objectives and ensure that Canada’s transportation system continues to be recognized worldwide as safe, secure, efficient and environmentally responsible.

Section I - Departmental Overview

1.1 Summary Information

1.1.1 Raison d’être and Responsibilities

Transportation is essential for Canada’s social and economic prosperity. Transport Canada was established to ensure that an effective transportation system provides access to markets for natural resources, agricultural products and manufactured goods, and supports service industries. A safe and secure system provides reliable and efficient movement of goods and people across the country and around the world. In an environmentally responsible way, it meets the challenges posed by topography and geography, linking communities and reducing the effects of the distance that separates people. These vital roles reflect transportation’s interdependent relationship with all sectors of the economy and society.

The department’s vision of a sustainable transportation system integrates and balances social, economic and environmental objectives. Our vision is guided by these three principles:

• the highest possible safety and security of life and property, supported by performance-based standards and regulations when necessary;
• the efficient movement of people and goods to support economic prosperity and a sustainable quality of life, based on competitive markets and targeted use of regulation and government funding; and
• respect for the environmental legacy of future generations of Canadians, guided by environmental assessment and planning processes in transportation decisions and selective use of regulation and government funding.

Transport Canada develops the Government of Canada’s transportation policies and programs. The department is responsible for developing regulations, policies and services under the legislative authority of Parliament. The department is required by the Canada Transportation Act to report on the state of the national transportation system. While not directly responsible for all aspects or modes of transportation, the department plays a leadership role to ensure that all parts of the transportation system across Canada work together effectively and efficiently.

Transport Canada is part of the Transport, Infrastructure and Communities Portfolio that includes Transport Canada, Infrastructure Canada, shared governance organizations (e.g. the St. Lawrence Seaway Management Corporation), Crown Corporations (e.g. the Great Lakes Pilotage Authority, Canada Post Corporation) and administrative tribunals/agencies (e.g. the Transportation Appeal Tribunal of Canada). Together, these organizations contribute to Canada’s competitiveness by ensuring a vibrant transportation system to make the economy stronger; keeping our transportation system safe and secure; protecting the environment; and improving the quality of life in our cities and communities.

1.1.2 Strategic Outcomes and Program Activity Architecture

As illustrated in Figure 1, Transport Canada’s Program Activity Architecture includes 15 program activities that contribute to achieving the four departmental strategic outcomes:

1. an efficient transportation system;
2. a clean transportation system;
3. a safe transportation system; and
4. a secure transportation system.

The sixteenth program activity, Internal Services, supports all four strategic outcomes. These four strategic outcomes specifically contribute to five Government of Canada [1] outcomes. Section II of this report explains how Transport Canada’s strategic outcomes and program activities contribute to these outcomes areas.

Figure 1: Transport Canada Program Activity Architecture

[Text version of Figure 1 - Program Activity Architecture]

1.2 Planning Summary

Please note that the information contained in this report reflects the department’s Main Estimates for 2012-2013.

1.2.1 Financial Resources

The following financial resources table provides a summary of the total planned spending for Transport Canada for the next three fiscal years. For more details on planned spending, including adjustments, please visit Transport Canada’s website on Planned Spending, or consult the departmental spending trend in section 1.6.1 below.

($ millions)

2012-13	2013-14	2014-15
2,084	1,795	963

1.2.2 Human Resources

The human resources table below provides a summary of the total planned human resources for Transport Canada for the next three fiscal years.

2012-13	2013-14	2014-15
5,487	5,449	5,372

1.2.3 Allocation of Funding by Strategic Outcome and Internal Services

Figure 2 displays the allocation of funding according to Transport Canada’s four strategic outcomes, as well as the program activity related to Internal Services. Transport Canada’s planned spending for 2012-2013 is allocated primarily to the strategic outcome of an efficient transportation system. As described in Section II, this is mostly due to infrastructure project spending in the Gateways and Corridors program activity. For more detailed information about Transport Canada’s spending including adjustments following Main Estimates and non-respendable revenues, see Transport Canada's website.

Figure 2: Allocation of 2011-12 Funding by Strategic Outcome and Internal Services
($ millions)

Strategic Outcomes (and Internal Services)	Forecast Spending 2011-12	Planned Spending 2012-13	Planned Spending 2013-14	Planned Spending 2014-15
An efficient transportation system	595	1,395	1,106	280
A clean transportation system	48	60	64	58
A safe transportation system	385	366	358	353
A secure transportation system	70	73	71	70
Internal services	284	189	196	200
Total*	1,382	2,084	1,795	963

*Due to rounding, columns may not add to the totals shown. Amounts are net of respendable revenue.

1.3 Risk Analysis

1.3.1 Operating Environment

Transportation is a part of all social and economic activities. It provides access to markets for natural resources, agricultural products and manufactured goods, supports service industries and links communities. Canada’s multi-modal transportation network includes 38,000 kilometres (km) of national and regional highways, 21 million registered vehicles, 243,000 km of shoreline, over 42,306 vessels, 34,175 aircraft including commercial and general aviation, and 45,322 km of freight and passenger rail tracks. Furthermore, the aspects of ownership, operation and regulation of Canada’s transportation system are a shared responsibility between various levels of government and the private sector. Through its legislative and regulatory responsibilities, the federal government supports efficiency, safety, security and environmental responsibility of the national transportation system, and facilitates coordination with the global transportation networks.

In response to changing economic conditions and government-wide priorities, Transport Canada continues to be a government leader in transforming its role and operations. In the mid 1990s, the department transformed itself from an operator of large portions of the national transportation system with over 20,000 employees, to a policy and regulatory organization with about 5,000 employees. This transformation led to unprecedented productivity gains in transportation; more responsive local governance structures of key assets; and a shift of costs from taxpayers to users and to capital investments funded by private operators. In 2008, Transport Canada completed a strategic review that focused on further reducing subsidies; refocusing operations on national and essential services; and on transforming the department’s regulation of transportation safety and security by adopting safety management systems.

In the years ahead, global pressures such as demographic shifts, natural resources’ scarcity, financial and fiscal constraints, balancing economic growth with environmental protection, and general global economic turbulence and will present a number of challenges and opportunities (e.g., northern development) for Canada and our transportation system.

In addition to the inherent risks due to its breadth, the environmental challenges and opportunities mentioned above, as well as changes to the department’s role as a more policy and partnership-based organization, Transport Canada is required to effectively manage risk as it pursues its strategic outcomes.

1.3.2 Risk Management Approach

Transport Canada has implemented a strong risk management governance structure. This is outlined in the new Integrated Risk Management Policy that promotes the systematic integration of risk management practices to respond to unforeseen events and risks identified in the department’s Corporate Risk Profile [2]. Further, the role of Transport Canada’s Centre of Expertise in Risk Management and the Risk Management Working Group have been streamlined to provide ongoing support to management and employees in promoting a consistent approach to identifying, assessing and responding to risk throughout the department.

Transport Canada has also improved its risk escalation processes through the enhancement of its integrated risk management governance and by consulting senior management on a regular basis. The department documents risk information from project, operational, program and strategic outcome levels. On an annual basis, in advance of the departmental integrated business planning process, Transport Canada officials review risk profiles and progress in implementing risk responses that are horizontal in nature and/or that are serious enough in their exposure to warrant reporting to the senior management level. Officials also update the Corporate Risk Profile, if required. Factors such as those resulting from a modification in the department’s mandate or priorities and changing economic, political and environmental conditions are also considered. The department also develops new mitigation measures and controls as needed to help achieve our results, as part of the annual planning process.

1.3.3 Key Risk Areas and Risk Responses

Transport Canada continues to manage the four key risk areas identified in its Corporate Risk Profile. Risk responses for each area are being implemented and monitored in light of the current global, national and departmental environment.

Risk regarding Transportation System Efficiency: Over the last several years, there has been an unprecedented level of federal investment in transportation infrastructure, including federal, provincial, municipal and privately-owned assets. The department will continue to work with partners and stakeholders on initiatives to support an efficient transportation system. This includes the implementation of the Building Canada Plan and Gateways initiatives, as well as the Canada-United States Perimeter Security and Economic Competitiveness Action Plan initiatives, which will enhance the flow of legitimate trade and travel across the Canada-United States border.

Going forward, the department will renew its transportation policy framework to ensure that it continues to respond to the needs of the transportation sector. Further, in partnership with stakeholders, we will continue to support innovative targeted research and innovative measures to foster the continued development of a transportation system that is smart and responsive to challenges affecting sustainability and efficiency.

Risk regarding Oversight Effectiveness and Efficiency: As a federal regulator and funding partner, Transport Canada will implement strategies to ensure that its safety and security related policy, program and regulatory mechanisms remain responsive to today’s requirements; aligned with on-the-ground operational realities, international trends and developments; and, above all, meet the needs of Canadians. The department has additional risk responses in place, such as the assessment of the regulatory and compliance implications of legislation and regulations earlier in the policy development process, to ensure this risk is continued to be managed effectively.

In addition, Transport Canada will continue to modernize and streamline its regulatory framework by developing a risk-based regulatory priority management system to contribute efforts towards improving the regulatory system and assessing compliance. The department is also enhancing surveillance training for all inspectors in order to promote continuous improvement and modernizing national risk based inspection standards and tools.

Risk regarding Security Threat/Incident Response Capability: Transport Canada has continued to enhance its communication channels and protocols within the department, with other departments and with stakeholders, including strategies and action plans to improve information sharing and security awareness. Through ongoing consultations with industry and other stakeholders, the department has also advanced in the review and update of the Marine Transportation Security Regulations and the refinement of policy options to make the transportation of dangerous goods by rail and road more secure. The department will continue to increase security for air passengers, air cargo and airport workers by working to harmonize its security framework with those of our international partners, enhance the Air Cargo Security Program and develop the National Civil Aviation Security Program.

Risk regarding Change Management: The effective management of change contributes to Transport Canada’s ability to achieve its strategic outcomes. To that end, the department will continue to enhance its governance and its capacity to optimize its use of financial and non-financial resources and its performance measurement framework. For significant transformational initiatives, Transport Canada will develop a comprehensive change management plan, including an escalation process to quickly resolve outstanding change management issues; and the establishment of regular progress reviews and reporting.

1.4 Delivering on Key Government and Organizational Priorities

Transport Canada’s priorities are aligned with commitments undertaken by the Government of Canada as outlined in the Speech from the Throne, 2011, successive federal budgets, and the Eighteenth Annual Report to the Prime Minister on the Public Service of Canada from the Clerk of the Privy Council. These commitments include initiatives such as the red-tape reduction initiative, the Shared Vision for Perimeter Security and Economic Competitiveness, the web of rules action plan, and the Management Accountability Framework. For example, the organizational priority “adopt people management strategies that support our workforce and workplace” directly relates to renewal activities captured under the broad themes of engaging employees in the excellence agenda, renewing the workforce, and renewing the workplace, outlined in the Clerk of the Privy Council report to the Prime Minister.

In 2012-2013, Transport Canada is focused on delivering on three key government priorities:

Supporting economic growth: A modern and efficient transportation system is crucial to Canada’s economic growth. Canada’s transportation network and its related activities accounts for 4.1 percent of gross domestic product and employs over 900,000 people. Most importantly, our transportation network moves $1 trillion of goods to markets each year. As the most trade dependent of all G8 nations, Canada exports $725 billion worth of goods, requiring an efficient transportation network linked to global markets. Through its strategic gateways and market-based policies, Transport Canada promotes a national transportation system that helps to keep Canada competitive in a global economy.

Protecting the safety and security of Canadians: Transport Canada’s primary role is to continue to ensure the safety and security of Canadians and Canada’s vast transportation network. For example, Transport Canada and the Canadian Air Transport Security Authority work together to ensure that Canada’s aviation system meets global security standards, including the screening of 51 million passengers, 62 million pieces of baggage and annual air cargo shipments worth $100 billion. As a regulator, inspector and overseer, Transport Canada works to ensure Canadians have one of the safest transportation systems in the world.

Serving Canadians: The portfolio delivers important services that enable Canadians to travel and trade goods. This ranges from mail delivery to inter-city passenger rail and ferry services to Newfoundland.

Organizational Priorities

Transport Canada has five organizational priorities that are aligned with the department’s Corporate Risk Profile. Each priority relates to one or more of the department’s strategic outcomes and aligns with Government of Canada commitments. By establishing departmental priorities, senior management will be better placed to strengthen strategic direction, ensure internal coherence and corporate discipline, and support management teams in delivering results to Canadians. These priorities are described in more detail in the following tables.

Organizational Priority	Type [3]	Links to Strategic Outcome	Alignment with Corporate Risk Profile
Refine and strengthen Transport Canada’s oversight function to improve transportation safety and security	Ongoing	A Safe Transportation System; A Secure Transportation System	Security Threat/Incident Response Capability; Oversight Effectiveness and Efficiency; Change Management
Status
Why is this a priority? Effective oversight improves safety and security by assisting industry to better understand its environment and its responsibilities, promoting industry compliance with regulations, building trust and collaboration (e.g., sharing of best practices) between various partners, and improving regulations and programs by obtaining feedback from industry and inspectors, including the identification of regulatory or program needs. By improving the training regime for managers and inspectors, adopting nationally consistent business protocols within each mode, and strengthening and standardizing national inspection planning and tracking systems, Transport Canada will be able to strengthen its oversight approach, enabling a shared safety and security culture among Canadians and the transportation industry. To meet this priority the department plans to: enhance compliance and oversight activities by strengthening national modal consistency in program delivery; increase support to Inspectorate through an improved national inspector training program which will include: tools, systems as well as improved communications and engagement; and strengthen and standardize a risk-based approach to oversight planning and inspection.

Organizational Priority	Type	Links to Strategic Outcome	Alignment with Corporate Risk Profile
Help make Canada’s critical transportation infrastructure safer and more efficient	New	An Efficient Transportation System	Transportation System Efficiency
Status
Why is this a priority? The construction of the Windsor-Detroit crossing will ensure sufficient border crossing capacity for the expected increase in trade over the next thirty years. The new crossing and connecting highway will help spur economic activity in southern Ontario and improve transportation efficiency between Ontario, Quebec and eastern Canada with the United States. The new bridge over the St. Lawrence River in the Greater Montreal Area will be a key component of Canada’s Continental Gateway and trade corridor, benefitting both the regional and national economies. To meet this priority the department plans to: move forward on the new Windsor-Detroit crossing by continuing to develop the project and governance agreements required to advance the project to the procurement/implementation phase, acquiring remaining properties, and fulfilling the post-environmental assessment commitments; and continue to work with our partners to move forward with the new bridge over the St. Lawrence River to replace the Champlain Bridge in the greater Montreal area.

Organizational Priority	Type	Links to Strategic Outcome	Alignment with Corporate Risk Profile
Continue to renew Transport Canada’s policy framework to ensure that its policies, programs and regulations will meet the needs of the transportation system over the next 10 to 15 years.	Previously Committed to	All Strategic Outcomes	Oversight Effectiveness and Efficiency, Security Threat/Incident Response Capability, Transportation System Efficiency and Change Management (all risks)
Status
Why is this a priority? The transportation sector contributes greatly to Canada’s economic success and long-term prosperity. It is important therefore that Transport Canada’s strategic approaches continue to be relevant and meet the needs of the transportation sector. A renewed policy framework will be able to support a transportation sector that is well positioned to address existing and emerging challenges and is ready to exploit new opportunities over the long term. To meet this priority the department plans to: review the transportation policy framework to ensure that policies, programs and regulations are appropriate to respond to existing and emerging challenges and opportunities over the next 10 to 15 years, including long term infrastructure requirements; assess the current air and marine policy frameworks to ensure their responsiveness to trends affecting air and marine transportation with a view to promoting a competitive and viable transportation system to support trade opportunities, bringing economic benefits to Canadians; review Transport Canada’s oversight policy, voluntary and regulatory frameworks to ensure that they are positioned to meet the safety and security needs of the transportation system over the next 10 to 15 years; complete an assessment of Transport Canada’s policies and programs toward its remote designated facilities and services; and continue to advance the departmental innovation strategy to drive the next generation of transportation sector productivity gains and improve system performance.

Organizational Priority	Type	Links to Strategic Outcome	Alignment with Corporate Risk Profile
Adopt people management strategies that support our workforce and workplace through transformational changes.	New	All Strategic Outcomes	Change Management
Status
Why is this a priority? Achievement of the department’s mandate depends on the knowledge, expertise, professionalism and commitment of its employees. Transport Canada must address workplace and workforce issues that arise from change initiatives and support employees’ development in order to ensure that the public service can effectively respond to Canadians’ needs in the future. To meet this priority the department plans to: launch a detailed workforce planning exercise to identify resourcing needs across regions and occupational groups. This information will be used to identify and prioritize staffing actions and placement opportunities for employees; use the senior executive level National and Regional Workforce Management Boards to identify, propose and monitor measures related to workforce management; design strategies to align people with appropriate work units, including the finalization of the Civil Aviation organizational structure; and provide guidance, support and people management strategies during major transformation initiatives for both managers and employees.

Organizational Priority	Type	Links to Strategic Outcome	Alignment with Corporate Risk Profile
Continue to strengthen Transport Canada’s management controls and practices.	Previously Committed to	All Strategic Outcomes	Change Management
Status
Why is this a priority? Improved internal management controls and practices enhance organizational effectiveness, resulting in higher organizational performance, improved program and service delivery, and better overall results. To meet this priority the department plans to: leverage and strengthen its governance framework and integrated business planning process, including make more effective use of its performance management and reporting; strengthen its integrated risk management approach; and proactively address external and internal audit findings (e.g., efficient and effective implementation of approved management action plans).

1.5 Transport Canada’s Contribution to the Federal Sustainable Development Strategy

The Federal Sustainable Development Strategy outlines the Government of Canada’s commitment to improving the transparency of environmental decision-making by articulating its key strategic environmental goals and targets. Transport Canada ensures that consideration of these outcomes is an integral part of its decision-making processes. In particular, through the department’s strategic environmental assessment process, any new policy, plan, or program initiative includes an analysis of its impact on attaining the Federal Sustainable Development Strategy’s goals and targets. The results of strategic environmental assessments are made public when an initiative is announced, demonstrating the department’s commitment to achieving the Federal Sustainable Development Strategy’s goals and targets.

Transport Canada contributes to the following themes: I - Addressing Climate Change and Air Quality; II - Maintaining Water Quality and Availability; III - Protecting Nature; and IV - Shrinking the Environmental Footprint – Beginning with Government, as denoted by the visual identifiers below:

These contributions are components of the following program activities and are further explained in Section II:

• 1.4 Transportation Innovation;
• 2.1 Clean Air from Transportation;
• 2.2 Clean Water from Transportation; and,
• 2.3 Environmental Stewardship of Transportation.

For additional details on Transport Canada’s activities to support sustainable development, please see Section II of the Report on Plans and Priorities or visit our Departmental Sustainable Development Strategy website. For complete details on the Federal Sustainable Development Strategy please see Environment Canada's website.

1.6 Expenditure Profile

For the 2012-2013 fiscal year Transport Canada plans to spend $2,084 million to meet the expected results of its program activities and to contribute to its strategic outcomes. This represents a net increase in planned spending of $702 million over the 2011-2012 forecast spending level of $1,382 million.

The difference is related primarily to a planned spending increase of $836 million (from funds received in Budgets 2006/2007) in the Gateways and Corridors program activity and specifically, the Gateway and Border Crossings Fund, the Asia-Pacific Gateway and Corridor Transportation Infrastructure Fund and the Detroit River Crossing Major Crown Project. This increase is offset by declining planned spending for grants related to agreements with First Nations for the development of the Port of Prince Rupert, and for the disbursement of severance pay and termination benefits due to ratified collective agreements, as well as minor changes in various other programs.

1.6.1 Departmental Spending Trend

Figure 3: Spending Trend for Transport Canada

Figure 3 shows Transport Canada’s expenditures (actual, forecast and planned) from 2008-2009 to 2014-2015. The trend shows a gradual increase in spending from $1,040 million in 2008-2009 to $1,382 million in 2011-2012, with a peak at $2,084 million in 2012-2013. The increase in planned spending is attributable to the implementation of projects under some of the department’s major initiatives including the Asia Pacific Gateway and Corridor Initiative and the Gateways and Borders Crossing Fund. After 2012-2013 planned spending declines as these initiatives approach their planned end dates.

[Text version of Figure 3 - Spending Trend]

1.6.2 Voted and Statutory Items

For information on the department’s organizational votes and/or statutory expenditures, please see the 2012-2013 Main Estimates publication.

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