Location: National
Key Messages:
- The transportation sector is essential to the success of the Canadian economy and serves as an integral component of supply chain flow that functions as the backbone of domestic and international trade.
- Ensuring the strength and resiliency of Canada’s supply chains is a top priority for the Government of Canada, and will help keep money in Canadians pockets and contribute towards building an economy that works for everyone.
- Strengthening Canada's transportation supply chain in a collaborative way with provincial and territorial partners is part of the Government of Canada’s strategy to respond to the rising cost of living, and to put more money back in the pockets of Canadians.
- Significant investments are being made under the National Trade Corridors Fund (NTCF), with over $3.7 billion in federal funding committed to more than 180 projects across the country to date. These include projects that enhance the efficiency and reliability of our transportation supply chains by addressing transportation bottlenecks, vulnerabilities, and congestion; building resilience to withstand the effects of climate change; better adapt to digital technologies; and address the transportation needs of the Arctic and northern communities.
- Canada’s transportation supply chains have been significantly impacted by the global COVID-19 pandemic, the war in Ukraine, and recent extreme weather events. These disruptions impact the daily lives of Canadians and the ability of our economy to grow.
- Understanding that solutions to persistent supply chain problems must be developed in tandem with industry, a Supply Chain Task Force was created to solicit independent advice identifying ways to mitigate supply chain pressures through innovative solutions.
- The Supply Chain Task Force submitted a Final Report to the Minister in October 2022, including recommendations that are informing the development of a National Supply Chain Strategy.
- Budget 2023 acknowledged the need to mitigate vulnerabilities in Canada’s supply chains through targeted investments, including $27 million over five years to establish a Transportation Supply Chain Office. The Supply Chain Office will work in collaboration with industry to respond to disruptions and better coordinate action to increase the capacity, efficiency, and reliability of Canada’s transportation supply chain infrastructure.
Summary of Issue / Background:
- The transportation sector is essential to the success of the Canadian economy, and serves as an integral component of supply chain flow facilitating domestic and international trade.
- Since its launch in 2017, the National Trade Corridors Fund (NTCF) has been allocated $4.6 billion to ease congestion and bottlenecks in Canada’s transportation system, and to enhance trade hubs and gateways for Canadian businesses to get their products to consumers around the world. To date, the Fund has committed over $3.7 billion towards more than 180 projects across the country.
- On December 9, 2021, a Call for Proposals was launched under the NTCF focusing on increasing the fluidity of Canada’s supply chains. The Call sought to advance funding under two investment themes, including strengthening Canada’s connections to global markets and building internal trade corridors. On January 31, 2022, an additional Call was launched to assist Canadian ports with the acquisition of cargo storage capacity and other measures to relieve supply chain congestion. Both calls are now closed with pending decisions for some projects under the supply chain fluidity call.
- Budget 2022 provided the groundwork for a National Supply Chain Strategy, committing $603.2M over the next five years to support continued investment in transportation infrastructure to help strengthen Canada’s supply chains, including $450M in new funding for the National Trade Corridors Fund. It also comprised funding for initiatives to create digital-first solutions to relieve congestion and help our supply chains become more sustainable and efficient.
- Federal Ministers hosted a National Supply Chain Summit, with a number of key business leaders and associations to identify solutions to strengthen Canada’s supply chains.
- The broad level of interest, representation, and meaningful interventions made at the Summit highlighted the importance of supply chains to Canada’s economic recovery. Key themes included addressing pervasive barriers in the transportation sector, fostering greater innovation, targeting infrastructure investments, and leveraging digital solutions.
- One of the recommendations was for the establishment of a National Supply Chain Task Force that was mandated to provide recommendations on short and long-term actions to improve the fluidity and reliability of Canada’s supply chains.
- The Task Force’s Final Report in October 2022 included recommendations to:
- Ease port congestion;
- Address labour shortages and employee retention;
- Establish a federal Supply Chain office to unify relevant federal government activities;
- Protect corridors, border crossings, and gateways from disruptions;
- Develop a national transportation Supply Chain Strategy; and
- Engage the United States and the provinces and territories to achieve mutual recognition of regulations, policies, and processes.
- The Fall Economic Statement (FES), issued in November 2022, provided an overview of actions taken to alleviate supply chain pressures, including initiatives to:
- Invest in critical transportation infrastructure, support industry-driven digitization of supply chains, and make supply chains more competitive by continuing to cut unnecessary red tape;
- Launching a Supply Chains Regulatory Review led by Treasury Board to consider further regulatory changes that could improve the efficiency and resiliency of Canada’s supply chains;
- Modernizing cargo and clearance inspection practices;
- Streamlining operating policies and regulatory practices that impact the flow of goods through our international gateways;
- Exploring ways to bolster protection and remedies for shippers and service providers due to service disruptions; and
- Improving data reporting and monitoring.
- On February 13, 2023, the Minister of Transport announced the launch of a new call for proposals under the National Trade Corridors Fund to advance supply chain digitalization. $50 million will be allocated to support projects that strengthen Canada’s digital infrastructure and help develop digital solutions to optimize supply chains.
- TC closed the “Advancing Supply Chain Digitalization” NTCF call for proposals on April 11, 2023, which targeted projects aimed at advancing Canada’s digital transformation to enhance efficiency and reliability of our transportation supply chains. Proposals are currently under evaluation, and it is anticipated that the funding decisions will be made later in 2023.
- Acknowledging the economic challenges for Canadians and businesses that come with supply chain disruptions, Budget 2023 included specific investments to further enhance resiliency, including:
- $27.2 million over five years, starting in 2023-24, for Transport Canada to establish a Transportation Supply Chain Office;
- $25 million over five years from existing funding, starting in 2023-24, for Transport Canada to work with Statistics Canada to develop transportation supply chain data that will help reduce congestion, make our supply chains more efficient, and inform future infrastructure planning.
- Budget 2023 also outlined commitments to:
- Introduce amendments to the Canada Transportation Act to provide the Minister of Transport with the authority to compel data sharing by shippers accessing federally regulated transportation services;
- Introduce amendments to the Canada Transportation Act for a temporary extension, on a pilot basis, of the interswitching limit in the prairie provinces to strengthen rail competition; and
- Launch a review of the Shipping Conferences Exemption Act to examine marine shipping competition.