Operating Context and Key Risks

From: Transport Canada

Operating Context: Conditions Affecting Our Work

Canadians need a transportation system that allows them to safely and efficiently reach their destinations and receive goods for their daily lives. Businesses and customers expect a transportation system they can trust to deliver resources and products to local and global markets, as well as for the jobs they depend on. Transportation also touches on other important challenges such as air and marine pollution, public safety and security and economic opportunity for all Canadians. Overall, transportation-related activities account for approximately 10% of Canada’s Gross Domestic Product.

In order to continue to fulfil Transport Canada’s mandate, we develop and implement federal transportation policies, regulations and programs. This is to ensure that Canada’s transportation system is:

  • Safe and secure;
  • Green and innovative; and
  • Integrated to support trade and economic growth, a cleaner environment and the well-being of Canadians.

To better serve Canadians, we are focused on modernizing the delivery of our programs and services. We are currently undertaking modernization initiatives that will allow us to:

  • Respond to the evolving demands of the transportation sector;
  • Encourage innovation; and
  • Ensure that Transport Canada officials have the competencies and tools needed to adapt to and succeed in a rapidly changing environment.

For 2018-19, we are planning to continue with the implementation of many key initiatives launched in 2017-18, including:

  • The Oceans Protection Plan, aimed at strengthening marine safety;
  • Transportation 2030, aimed at improving Canada’s national transportation system; and
  • Investing in improvements to trade and transportation corridors, such as transportation infrastructure projects in communities across Canada and at strategic points throughout the transportation system.

As such, we will continue to respond both effectively and simultaneously to:

  • Safety and other transportation risks;
  • Industry needs;
  • Public concerns with respect to the impacts of the transportation sector on the environment;
  • Shifting population demographics; and
  • Increasing volumes of:
    • Travellers; and
    • Freight (including freight containing dangerous goods).

Key Risks: Things that Could Affect Our Ability to Achieve Our Plans and Results

At Transport Canada, we employ risk management to support decision-making and to improve business practices, including:

  • Policy development;
  • Priority setting;
  • Resource allocation;
  • Program delivery; and
  • How we conduct activities that broadly support our mandate.

Consequently, our risk management approach consists of:

  • An ongoing identification and monitoring of risks; and
  • The semi-annual reporting on our progress and overall performance of risk response strategies.

We began our Corporate Risk Profile update for 2018-19 with an analysis of our operating, environmental and financial context. During the risk identification phase, we reviewed:

We also considered the government’s commitments to protect Canada’s ecosystems, facilitate access to public transit and link communities, and address international and national security challenges.

The key elements of Transport Canada’s Corporate Risk Profile are presented in the table below.

Risks Risk Response StrategyFootnote 1 Link to the Department’s Programs (or Core Responsibilities) Link to mandate letter commitments or to government-wide and departmental priorities (as applicable)
Federal transportation policies, programs and infrastructure investments may not effectively support an efficient, innovative and resilient system for the transportation of goods and people, and the adoption of new technologies.

The Canadian transportation system continues to face challenges to ensure Canada remains competitive in getting products, services and people to key markets. At the same time, Canadians are increasingly concerned about travel costs, accessibility and level of services. Moreover, transportation systems continue to be vulnerable to climate change impacts. To address these concerns, Transport Canada, under Transportation 2030, aims to improve the transportation system’s performance to get products to markets in order to grow Canada’s economy, and provide greater choice, better service, lower costs and new rights for consumers. Transport Canada’s adaptation initiatives contribute to the Pan-Canadian Framework on Clean Growth and Climate Change objectives related to infrastructure resilience and protecting vulnerable populations, including in Canada’s North.

Specific risk responses include:

  • Working on greater transparency in the rail transportation supply chain, taking a more balanced approach for stakeholders, and supporting a more competitive and efficient rail sector;
  • Working with industry on clear and fair consumer protection rules for air travelers;
  • Pursuing legislation to change international ownership restrictions from 25% to 49% of voting interests for Canadian air carriers;
  • Continuing an in-depth assessment of VIA Rail's high frequency rail proposal for the Toronto-Quebec City corridor;
  • Working with recipients of federal funding to ensure that allocated funding is being spent on eligible expenditures;
  • Implementing merit-based funding programs to target investments where the need and alignment with federal priorities is greatest;
  • Delivering policy and program elements of the Trade and Transportation Corridors Initiative, including the $2 billion National Trade Corridors Fund that invests in building stronger, more resilient and efficient transportation corridors to international markets;
  • Conducting reviews of Canada Port Authorities and the Great Lakes St. Lawrence Seaway system to ensure these critical trade and transportation assets continue to support an innovative and inclusive Canadian economy;
  • Collaborating with international partners and the World Economic ForumEndnote i to assess the positive impacts that emerging technologies can have on developing a passenger-centric approach to aviation that balances security, efficiency, and facilitation;
  • Investing in projects to assess climate risks for federally-owned transportation assets and support innovative adaptation technologies and capacity-building efforts to increase transportation resilience in the North;
  • Developing a new Transport Canada climate change adaptation plan, advancing efforts to strengthen adaptation knowledge and capacity, and further integrating climate considerations into departmental decision-making;
  • Working with provinces and territories on road safety and policy issues to support the use of automated and connected vehicles in Canada;
  • Launching the Trade and Transportation Information System to better inform decision-making and improve the coordination and planning of capacity and public/private transportation infrastructure investments, with initiatives such as the Canadian Centre on Transportation Data and the Open Data Portal as the authoritative source of information on transportation in Canada, and the Port-city Supply Chain Visibility project about the performance of the supply chain; and
  • Establishing an Innovation Centre to better anticipate technological change and identifying solutions.

This risk is linked to the following Core Responsibilities:

  • Efficient Transportation System
  • Green and Innovative Transportation System

Priority 1: Improve the performance and reliability of Canada’s transportation system to get products to market and grow our economy.

Priority 2: Provide greater choice, better service, lower costs and enhanced rights for consumers.

Priority 3: Build world-leading marine corridors that are competitive, safe and environmentally sustainable, and enhance Northern transportation infrastructure.

Transportation-related security incidents – such as those caused by cyber threats – may not be effectively addressed due to communication gaps at critical points.

Security threats faced by our transportation system are becoming more complex and multi-faceted. To ensure the secure transmission of security information Transport Canada will review existing processes and seek opportunities to better engage and exchange information with our diversified stakeholders and several partners, both nationally and internationally.

The increased use of digital, connected systems in various transportation sectors has also introduced a number of cyber security vulnerabilities in the transportation system.

To address these concerns, the Department reviews and amends, as required, existing procedures to ensure a robust and repeatable process for the dissemination of information relating to transportation security incidents.

Additional risk responses include:

  • Conducting and participating in periodic exercises and drills to validate procedures and their understanding and application by employees; and
  • Working with other government departments to enhance cyber security for the transportation system.

This risk is linked to the following Core Responsibility:

  • Safe and Secure Transportation System

Priority 4: Build a safer and more secure transportation system that Canadians trust.

Federal transportation programs and regulations may not effectively contribute to reducing the environmental impacts of transportation-related activities including their adverse effects on Indigenous Peoples, and Coastal and Northern communities.

The Canadian transportation system accounts for approximately 23% of Canada’s total greenhouse gas (GHG) emissions. Moreover, marine shipping activities continue to pose threats to fragile ecosystems and marine species at risk. To mitigate these risks, Transport Canada is working with provinces and territories through the Pan-Canadian Framework for Clean Growth and Climate Change, to ensure we are doing all we can to support the transformation to a low-carbon transportation system. The department is actively implementing the Oceans Protection Plan in collaboration with Indigenous groups, coastal communities, provinces and territories to strengthen Canada’s position as a world leader in marine safety. The Oceans Protection Plan, which includes a number of innovative and transformation initiatives being implemented by five federal organizations, supports responsible shipping, restoring and preserving marine ecosystems, strengthens partnerships with Indigenous and coastal communities, and invests in evidence-based emergency preparedness and response to keep Canadians safe and our coasts protected.

Transport Canada will continue to implement a moratorium on Crude Oil Tanker Traffic on British Columbia’s North Coast, and work with partners to build marine corridors that are competitive, safe and environmentally sustainable.

Specific risk responses include:

  • Continuing to work with other federal departments to ensure that federal priorities are advanced, including carbon pricing, the Clean Fuel Standard and other measures in the Pan-Canadian Framework;
  • Putting in place a multi-year plan to demonstrate Transport Canada’s commitment to reducing GHG emissions from its own operations;
  • Conducting research and regulatory development to ensure that motor vehicle safety standards allow the use of clean technologies for the purpose of GHG emission regulations for vehicles;
  • Developing a Canada-wide zero-emission vehicle strategy with provinces and territories, and in consultation with industry and other stakeholders;
  • Addressing GHG emissions from aviation and shipping by supporting the International Civil Aviation Organization’sEndnote ii and the International Maritime Organization’sEndnote iii development of new international standards and recommended practices and with new domestic regulations, as well as through Canada’s voluntary Action Plan in collaboration with the Canadian aviation sector;
  • Continuing to advance our understanding of the impacts of marine transportation on ecosystems, and developing mitigation strategies;
  • Implementing a comprehensive strategy to address abandoned and wrecked vessels in Canadian waters, including new legislation, enhancing vessel owner identification systems, and establishing a long-term approach to funding the clean-up of abandoned and wrecked vessels;
  • Administering the Abandoned Boats Program including education outreach, and research into recycling and vessel design, and small vessel removal components;
  • Continuing to work with other stakeholders to advance research, assess mitigation measures and develop and implement proposals for short-term action and a longer-term strategy to improve the recovery of the Southern Resident Killer Whale, the North Atlantic Right Whale, and other endangered whales;
  • Introducing legislative changes to strengthen environmental protection and response in Canada’s waters;
  • Actively implementing the Oceans Protection Plan in collaboration with Indigenous groups, coastal communities, provinces and territories;
  • Working towards partnering with Indigenous and coastal communities to better respond to marine-related matters, such as preparedness and response;
  • Continuing to work with Northern communities in order to address the unique challenges of northern transportation corridors; and
  • Implementing merit-based funding programs to target investments where the need and alignment with federal priorities is greatest.

This risk is linked to the following Core Responsibility:

  • Green and Innovative Transportation System

Priority 3: Build world-leading marine corridors that are competitive, safe and environmentally sustainable, and enhance Northern transportation infrastructure.

Priority 5: Reduce environmental impacts and embrace new technologies to improve Canadians’ lives.

Canada’s transportation legislative, regulatory and oversight regimes may not effectively address emerging safety and security issues, industry practices and increasing demands.

Transport Canada has built a world-class regulatory regime. However, new technology, demographics, markets and business environments continue to evolve at a fast pace.

To respond to these challenges and to maintain Transport Canada’s status as a world-class regulator and economic enabler, we have launched an ambitious Transformation Agenda. This includes, among several projects:

  • Modernizing our legislative framework to better support efficiency, facilitate and respond to innovations, and provide for a leading edge, risk-based safety and security oversight framework which leverages professional expertise and digital technologies to oversee, manage and minimize existing and emerging risks to the transportation system;
  • Enhancing our analytical capabilities and use of data to strengthen risk management practices in order to maximize the impact of oversight activities on the safety and security of the Canadian transportation system;
  • Establishing an Innovation Centre to position the department to better anticipate technological change, share expertise in technology and research, and identify solutions while influencing technology development; and
  • Providing industry clients and the public with consistent and efficient digital services to obtain safety and security certificates and other regulatory services.
  • Proactively review the impact that cyber security can have on Canada’s transportation systems and develop strategies to combat this emerging threat.

Other risk responses include:

  • Strengthening specific legislative and regulatory regimes, including:
    • In rail safety: proposing legislative amendments and regulations related to locomotive video and voice recorders, addressing fatigue issues, and updating railway employee training and qualification regulations, including a statutory review of the Railway Safety Act; and
    • In marine safety: working to restore protections and incorporate modern safeguards through the proposed Canadian Navigable Waters Act;
  • Developing a range of regulatory and non-regulatory tools and guidelines to facilitate the safe testing and deployment of emerging technologies in the automotive sector (e.g. connected and automated vehicles);
  • Developing performance indicators by setting accidents/incidents reduction targets and ensuring ongoing engagement with railway companies and other relevant stakeholders;
  • Putting in place dedicated resources over the next four years to review and update the Canadian Aviation Regulations to address outstanding and emerging aviation safety regulatory issues;
  • Strengthening the regulatory framework for the safe integration of Remotely Piloted Aircraft Systems into Canadian airspace to support innovation;
  • Implementing the regulatory framework for the Fishing Vessel Safety RegulationsEndnote iv, which came into force on July 13, 2017; and the International Maritime Organization’s mandatory Code for ships operating in polar waters (Polar Code), by introducing the new Arctic Shipping Safety and Pollution Prevention Regulations;
  • Implementing guidelines for cruise ships and tour operators using Northern marine transportation corridors;
  • Establishing the Civil Aviation National Oversight Advisory Board to allow for more timely and effective enforcement action; and
  • Modernizing the oversight system for the transportation of dangerous goods to promote industry compliance and ensure emerging issues are identified and addressed.

This risk is linked to the following Core Responsibility:

  • Safe and Secure Transportation System
  • Green and Innovative Transportation System

Priority 4: Build a safer and more secure transportation system that Canadians trust.

Priority 6: Advance Transport Canada’s five-year plan to reform key outdated legislation to allow more modern oversight and enforcement, and alignment with international best practices.

Footnote

Endnotes

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