Location: National
Key messages:
- Transport Canada’s top priority is ensuring all Canadians have access to safe, efficient, and reliable air transport.
- Given our country’s large land mass and spread-out communities, air travel is more important than in most countries. Canadians use air travel to access critical services, visit friends and family, and support domestic and international trade and tourism.
- COVID-19 placed extraordinary strains on commercial aviation around the world, and severely tested the ability of Canada’s air transportation sector to provide the services Canadians rely on.
- Despite these impacts, the sector demonstrated resiliency and played a key role by continuing to provide essential air services, including travel to medical appointments from remote communities, air ambulance services, community resupply, getting goods to market, search and rescue operations, and responding to wildfires.
- As travel restrictions began to lift, a rapid return in travel demand led to considerable congestion globally. While the increased travel demand was a positive sign for the sector, it outpaced the system’s capacity to hire, train, and certify staff at the pace required, all in a tight labour market.
- Over the spring/summer 2022 travel season, significant issues at Canada’s airports were reported including long line-ups for security screening and customs, aircraft being held on the tarmac, delays and cancellations, as well as mishandled baggage.
- The Government of Canada quickly responded to support the industry’s recovery, working closely with other government departments and industry, including airports and airlines, to remove bottlenecks, create efficiencies, and streamline processes for travellers.
- Improvements were made by partners in the air sector, including hiring and training of new employees, and performance returned to near pre‑pandemic levels by the end of the summer.
- Recent announcements in Budget 2023 demonstrate the Government of Canada’s commitment to strengthen the air transport sector, provide better protections for passengers, improve operations at airports, and enhance data sharing to develop an ecosystem that improves the air passenger journey.
- Further initiatives, including Bill C-52, are underway to enhance accountability and transparency in Canada’s air sector bring greater efficiency to the system.
Summary of Issue / Background:
- Canada’s air transportation is a major contributor to the national economy and an important source of jobs. Before the COVID-19 pandemic, the sector contributed over $14 billion in real gross domestic product and employed approximately 107,000 Canadians.
- The impact of the pandemic on the air transportation sector was unprecedented. Following its onset, travel volumes fell by 90% for a year, generating some of the largest revenue and job losses of any major sector.
- In the wake of these challenges, the Government of Canada took considerable actions to support the air sector:
- In March 2020, the Government of Canada announced Airport Rent Relief from March to December 2020 by waiving rents for the 21 airport authorities that have ground leases with the federal government, as well as Ports Toronto which operates Billy Bishop Toronto City Airport. Additional support was provided from January to December 2023 through a combination of waivers and deferrals.
- In April 2020, the Government of Canada announced up to $17.3 million for Northern Carriers to ensure that essential goods like food and medical supplies could reach communities in the Territories that depend on air transport. The Government announced more funding of up to $174 million in August 2020 to ensure continuity of essential air access to remote communities through bilateral agreements with provinces and territories under the Remote Air Services Program (RASP).
- The Airports Capital Assistance Program (ACAP), which provides up to $38 million per year in funding to small and regional airports to make critical investments in safety-related capital infrastructure, received a one-time top up funding of $186 million for two years from 2021- 2023. During this period, the minimum federal cost share was increased to 50% and the program was expanded to include 8 small federally owned airports. This financial support helped make sure that Canada’s smaller airports could immediately make required safety improvements despite revenue losses due to COVID-19.
- In May 2021, the Airport Relief Fund (ARF) provided $64.8 million in financial relief to 22 airports struggling with reduced air travel during the COVID-19 pandemic. This helped eligible airports maintain operations and mitigate the risk of insolvency.
- In 2021, the Airport Critical Infrastructure Program (ACIP) was launched to provide over $570 million in funding over 5 years to airports for eligible infrastructure projects related to safety, security, connectivity to mass transit systems, or testing and screening related to COVID-19 and its variants. This funding was allocated to 53 critical infrastructure projects at 19 airports across Canada.
- The Regional Air Transportation Initiative (RATI), delivered by Canada’s Regional Development Agencies (RDAs) in 2021 also provided $206 million over two years to eligible regional businesses and airports that directly contribute to regional air transportation to help maintain regional air connections and services during the pandemic.
- As travel restrictions began to lift in 2022, a rapid return in passenger demand led to considerable congestion globally. Canada’s major international airports were not immune to this, and experienced heightened delays and cancellations.
- Between February and June 2022, passenger traffic in Canada grew by more than 280%. This significantly outpaced growth in the United States, which saw only a 58% increase during the same period.
- While the return of passenger demand was a positive sign for the sector, it brought upon major issues with air passenger operations. Travellers globally experienced long lines, cancelled flights, missed connections, and delayed baggage. These challenges required collaboration between all partners within the ecosystem to be able to respond to the return of passenger demand.
- In May 2022, Transport Canada convened the Airport Recovery Operations Committee (AROC) to address concerns and find solutions. It brought together major airport operators and air carriers, the Canada Border Services Agency (CBSA), Canadian Air Transport Security Authority (CATSA), NAV CANADA, and the Public Health Agency of Canada (PHAC) to actively monitor and coordinate efforts to reduce the impact of service disruptions. This committee was also used to gather information for providing regular updates to the Prime Minister’s Task Force on Improving Service to Canadians.
- On November 24, 2022, the Minister of Transport hosted a National Air Sector Recovery Summit. The Summit convened senior leadership from across Canada’s air sector – including air carriers, airport operators, industry and trade associations, unions, and federal partners – to discuss critical issues facing commercial passenger air transportation and the future of the sector in Canada.
- Summit participants discussed a broad range of challenges, strategies, and next steps to support a strong a resilient transportation sector. Topics of discussion included:
- COVID-19 lessons learned and future challenges
- Supporting digital transformation
- Managing costs and infrastructure
- Integrating how we manage services at airports, including through data management
- Transparency, accountability, and passenger rights
- Moving forward, the Government of Canada is prioritizing further improvements to the air transport sector and air passenger journey. Budget 2023 provided $1.8 billion to the Canadian Air Transport Security Authority to maintain and increase service levels, improve screening wait times, and strengthen security measures at airports.
- Budget 2023 also provided $5.2 million to collect and analyze air sector performance data. Transport Canada is formally engaging with airports, airlines, and other stakeholders to ensure their perspectives are considered during this process.