The head of the Atlantic Provinces Trucking Association says Marine Atlantic is “holding Newfoundland and Labrador hostage.”
Marine Atlantic, the Crown corporation that runs the ferry service between North Sydney, N.S., Port aux Basques and Argentia, increased its fees by three per cent this season. This is the third year prices have jumped, and fees are up 11 per cent since 2012.
When ferry prices increase, says trucking association executive director Jean-Marc Picard, “the consumer in Newfoundland ends up paying.”
The ships, considered part of the federally funded Trans-Canada Highway, provide a vital link between Newfoundland and the mainland, and everything from food to lumber is transported on the ferries.
John Doucet, CEO of the transportation company Day & Ross, understands Picard’s frustration.
“Consumers and our shippers have got a big stake in this, at least as much or bigger than I do,” he says. “We can’t absorb (the increased costs) and I’d expect that our shippers are passing it on to the consumer.”
Darrell Mercer, spokesman for Marine Atlantic, says the three per cent hike was required to meet its increasingly higher operating costs.
Ever-inflating fuel prices are calculated in the fuel surcharge, he says. But everything else, from the shuttle buses used to transport passengers around the terminals to the duvet covers in the sleeper cabins is becoming more expensive.
“We recognize that there is a price point customers are willing to pay. When we need to increase our fees to meet our budget, we don’t do it lightly,” Mercer said.
He says Marine Atlantic is streamlining its processes to make the company more efficient.
Jim Cormier, Atlantic director of the Retail Council of Canada, calls the constant rate increases troubling.
“For smaller retailers, it can make or break them,” he says.
“For larger retailers it may mean they bring in fewer products or shorten the hours they’re open.
“The costs of retail goods are already higher than pretty much anywhere else in Canada except in the north,” he says.
Cormier says companies like Oceanex provide an alternative to Marine Atlantic for shipping some goods. But a lot of products, especially perishable ones, need the twice-daily shipments that only Marine Atlantic, with its federal subsidies, can provide.
“If you were to get rid of that subsidy there would be no way they could maintain the service. The harsh reality is that if we don’t have federal funding, retail prices are going to go through the roof,” he says.
For the past five years Marine Atlantic has had a long-term funding agreement with the federal government. This is up for review next year and Cormier is concerned that the federal government will reduce funding, further driving up Marine Atlantic’s fees.
“It might not mean much to a high-level bureaucrat sitting in Ottawa, but it would affect prices and jobs everywhere in Newfoundland and Labrador,” he says.