The Oceanex site is shown in this 2011 photo. — Star file photo
Oceanex boss Sid Hynes maintains Marine Atlantic’s receipt of federal government subsidies have forced his marine shipping business out of the Port of Corner Brook.
Hynes said Marine Atlantic's cost recovery from the federal government, which was 67.7 per cent for the 2012-13 year, makes it difficult to do any marine freight business.
Hynes, a former Marine Atlantic chairperson, called it “competing with our own tax dollars," and asserted that those subsidies are against marine transportation policy in Canada.
Section 5B of the National Transportation Act states that “Regulation and strategic public intervention are used to achieve economic, safety, security, environmental or social outcomes that cannot be achieved satisfactorily by competition and market forces and do not unduly favour, or reduce the inherent advantages of, any particular mode of transportation.”
Hynes said that when he was at the helm of Marine Atlantic, the subsidies were no more than 25 per cent.
“I don’t know what we’re going to do, but we’ll do what we have to,” he said. “At the end of the day we’ll take this to court and let them decide.”
Humber-St. Barbe-Baie Verte MP Gerry Byrne takes issue with Hynes’ statements, especially those concerning the national policy.
The Liberal MP said nothing has been found to be wrong with the subsidies in question when put under a microscope.
“I don’t believe for one second that a constitutional guarantee is subservient to an interpretation of a policy. I think the opposite is true,” he said. “The auditor general of Canada has conducted two special legislative audits on Marine Atlantic and they never indicated there is a problem with the legal authority to receive these subsidies and to charge the freight rates that currently exist.”
Byrne added that it isn’t not just this province’s ferry service receiving subsidies. Similar marine organizations in Nova Scotia, New Brunswick, Prince Edward Island and British Columbia can also count government funds as a source of income.
“He took over at Oceanex knowing full well the economic realities of a constitutionally guaranteed service, for which he personally recommended that rates across the board should go down,” said Byrne of a 2005 Marine Atlantic strategy report recommending a 15 per cent rate reduction and 44 per cent cost recovery. Hynes was the chair of the advisory committee that wrote the report.
Hynes resigned as chairperson of Marine Atlantic in 2004. He took over as CEO of Oceanex in 2007.
“To suddenly cry foul and put on a poor face is nothing but a slap in the face to everyone in this province,” Byrne said.
The MP also said it’s a slap to pocketbooks, stating that getting rid of subsidies means higher prices on groceries and other items, which Hynes called preposterous.
“What started as an issue of the Port of Corner Brook has now bloomed into an issue of the constitutional rights of everyone in this province and the greed that has been expressed by a single private operator trying to maximize their own operation.”
As for the lease with the Port of Corner Brook, Hynes said it is a private manner within a private company and would not discuss the issue further.