Location: Ontario, Quebec, National
Issue: High Frequency Rail – Main Estimates of VIA HFR Inc.
Date: March 7, 2023
Suggested Responses
- Transport Canada is seeking $314 million and a transfer of $43.6 million to VIA-HFR through the Main Estimates 2023-24 to continue advancing the High Frequency Rail (HFR) Project through the procurement phase.
If Pressed
What is the source of the funding?
- The source of funds for this submission is Budget 2022 over two years (The Next Steps Towards High Frequency Rail). Transport Canada is seeking, in 2023-24, to adjust its departmental reference levels in its Vote 1 – Operating Expenditures, in the amount of $313.2 million ($12.5 million for salaries and $300.7 million for other operating costs), in its Vote 10 – Grants and Contributions in the amount of $744,300 and an additional $5.5 million for the employee benefits plan and other centrally withheld amounts.
- Transport Canada will transfer $43,670,000 to the new Crown Corporation, VIA-HFR, through the Main Estimates.
What are the objectives of the program?
- The High Frequency Rail project proposes to build an intercity passenger rail network of over 1000 kilometers (km) between Toronto, Peterborough, Ottawa, Montreal, Trois-Rivières and Quebec City.
- By operating on mostly dedicated and electrified track, High Frequency Rail has the potential to transform intercity passenger rail by offering a faster, more frequent, more reliable, and cleaner transportation service.
What are we doing with the funds?
- The funding of $314 million for 2023-24 will support: the procurement process to select a private developer partner; building a robust project governance and delivery structure, and advancing key project activities, such as public engagement and Indigenous consultations.
- The funding will cover the costs related to the procurement process that was launched on February 17th, 2023, including the bid fees as part of the Request for Proposals. The procurement process is planned to be completed in Summer 2024.
- The $43.6 million for 2023-24 will be transferred to support the creation and operationalization of the new Crown Corporation subsidiary of VIA Rail (VIA HFR – VIA TGF Inc.) for the purpose of developing and implementing the High Frequency Rail project on behalf of the Minister of Transport.
How will Canadians benefit from the funds?
- High Frequency Rail will be the largest transportation infrastructure project seen by Canada in decades. The Project will offer travelers a more frequent, faster and more reliable transportation option in this heavily travelled corridor; improved connectivity between cities and with other modes of transportation; an innovative and sustainable transportation option to reduce greenhouse gas emissions; and a safe and accessible transportation option, providing Canadians with better travel options to meet their needs.
Background Information
- As the HFR project is the largest transportation infrastructure project Canada has seen in decades, the Government of Canada has been taking a phased and prudent approach to project advancement to ensure the best possible outcomes for Canadians.
- Over the last few years, Transport Canada (TC) has been working with VIA Rail, the Canada Infrastructure Bank, and other federal departments and agencies to move the HFR project forward. Funding has been sought at key junctures to support the project in its continued advancement.
- For example, Budget 2016 provided TC with $3.3 million to conduct a first round of due diligence on the HFR proposal. Budget 2018 provided an additional $8 million to TC to conduct further due diligence on all major project elements, including capital and operating cost estimates, revenue and ridership forecasts, and estimated impacts on greenhouse gas emissions. In 2019, the Government committed $71.1 million to undertake a range of activities that fell into five main work streams: 1) work to develop a routing alignment; 2) environmental analysis; 3) public engagement and Indigenous consultations; 4) financial/commercial analysis; and 5) additional targeted analyses.
- Budget 2021 allocated $495.6 million to VIA Rail and TC to implement targeted infrastructure investments on VIA’s current service network, and to further de-risk the HFR project.
- Most recently, Budget 2022 has allocated $396.8 million over two years, starting in 2022-23, to Transport Canada and Infrastructure Canada to advance HFR through the next phase of the project.