A Long-Term and Reliable Approach for the Eastern Canada Ferry Services

Through the Ferry Services Contribution Program, the federal government provides funding to private operators to support three inter provincial ferry services in Eastern Canada:  Saint John, New Brunswick (NB) / Digby, Nova Scotia (NS); Wood Islands, Prince Edward Island (PEI) / Caribou, NS; and Îles-de-la-Madeleine, Quebec (QC) / Souris, PEI.  These services are collectively referred to as the Eastern Canada Ferry Services. 

Under the current approach, funding is provided to private operators through agreements to cover operating deficits (revenues minus operating costs) and to maintain four vessels and six terminals used to provide the services.  As the owner of the terminals and vessels, Transport Canada is responsible for capital investments in these assets.

The Government of Canada understands the importance of the Eastern Canada Ferry Services to the local communities and economies of Eastern Canada. Canadians in Atlantic Canada and eastern Quebec, as well as tourists and businesses, rely on safe and efficient ferry services to support vibrant and sustainable communities. These services are an important part of the fabric of regional and local communities and economies, as they connect people and facilitate tourism and trade.  The Government is committed to a long-term approach for these ferry services and a new delivery model that will provide certainty and sustainability to communities through high quality service with newer and better vessels, while supporting the regional Atlantic and Quebec economies.

As such, the Government is looking at the delivery of the ferry services through long-term service contracts which would see operators supplying the ferry vessels used to deliver the service. 

Providing Long-term Certainty and Sustainability to Users and Communities

The new delivery model would provide long-term certainty and sustainability to communities through a high quality service, aligned with demand, with newer and better vessels while supporting the regional Atlantic and Quebec economies. Vessels would be Canadian-flagged, which means the operators would be required to hire Canadian crew and therefore maintain existing local employment opportunities.  Vessel repair and maintenance would be undertaken in Canada, providing benefits for the Canadian marine industry.

Once the Request for Information (RFI) is complete, the results will be analyzed and it is anticipated that the Government will move forward with a Request for Proposal.  

Budget 2017 proposes to provide $278.3 million, over five years, for the continued safe and reliable operations of these three ferry services.  This funding will support a transition to a long-term approach and demonstrates the Government’s commitment to the ferry services and the communities and businesses they serve.

Engaging Industry on a new Long-term Approach for the Ferry Services

The RFI is an initial step in consulting industry on a new long‑term approach that would provide greater certainty to communities and users while supporting regional economies.

The objective of the RFI is to seek industry feedback on a new long-term approach involving long-term contracts under which operators would supply the vessels used to deliver services that would respond to user demand while improving service quality and efficiency. A transition period, where Transport Canada’s existing vessels, would be available to ensure continuity of the services while operators acquire their own vessels.

A three-stage process will be used to engage industry:

• An Industry Day will be held in Gatineau on June 2, 2017 to present the key parameters of the RFI.
• Subsequent one-on-one meetings will be held with Industry between July 10  and 21, 2017 to discuss initial responses to the RFI.
• Industry’s final responses to the RFI are due on July 31, 2017.

As part of this three-stage process, the Government will be seeking to obtain key information on the new approach, including:

• the broader economic benefits to Canada, including potential opportunities for Indigenous peoples, local and regional communities and businesses;
• market interest and commercial capability;
• the availability of vessels that could be used to provide service;
• service levels;
• appropriate management structure for operators;
• considerations in operating all three services;
• customer service and satisfaction;
• general costs and cost assumptions; and
• the potential industrial benefits.

The Government will also engage Indigenous Peoples to discuss potential employment opportunities associated with the proposed approach.