The Liberal government's new Transportation Modernization Act is a strange beast. Tabled on Tuesday, it will give passengers more rights and protections, and it opens the door to greater competition in the Canadian airline industry. But it will also raise the cost of flying in and out of Canadian airports, which could mean higher ticket prices.
The bill's headline initiative will let Ottawa create regulations to prevent airlines from kicking unwilling passengers off planes when seats are overbooked – a hot-button issue these days.
The regulations will also set the amount of compensation that passengers are due when their flights are delayed or cancelled, their luggage is lost, or they are stuck on the tarmac for hours.
Given the recent chaos in the United States, a single set of rules on overbooking and compensation would be a welcome relief for travellers on Canadian airlines.
Also welcome is the news that the bill, if passed, will increase the maximum amount of foreign ownership in a Canadian airline from 25 per cent to 49 per cent. The government's hope is that this will increase competition, which could translate into lower costs for travellers and more flights in and out of Canadian airports.
This is where the bill works at cross-purposes with itself. It also contains measures to allow the Canadian Transport Security Authority, which runs airport security screening in Canada, to "provide new or additional screening services on a cost-recovery basis."
CATSA is currently funded by Parliament. The government is now saying that, if an airport wants to add routes and needs to expand its capacity to screen passengers, it will have to pay CATSA for additional services, and that "it would be up to each airport to determine how it would cover these costs."
Our guess is that airports will hand those costs on to passengers as some sort of fee. Which is a drag. Canada already has some of the highest airport costs in the world. Along with a lack of competition, they are the reason millions of Canadians drive across the border every year to take cheaper flights out of American airports.
Why has Ottawa suddenly decided these costs will go up, just as it is taking steps to otherwise make flying more popular?