Binkley on Air Canada/Aveos


Alex Binkley is a foremost political and economic analyst, whose website Readers will be aware that his columns in True North Perspective have foreseen political and economic developments in Canada. This week in ... 

The Binkley Report Times Two


Feds, Air Canada caught in Aveos turbulence

Harper MPs use majority to hide committee conclusions from parliament

By Alex Binkley
True North Perspective

The Harper government and Air Canada are scrambling to deal with opposition and union charges that the airline has broken federal law by shipping aircraft maintenance out of Canada.

The question they should answer is why the bankruptcy at Aveos that shuttered aircraft maintenance operations in Montreal, Toronto and Winnipeg caught the government and airline apparently by surprise?

Usually businesses pay close attention to the financial health of major suppliers. Air Canada didn’t see this coming? Seemingly Transport didn’t as well although its aviation safety duties include the state of aircraft servicing in Canada.

The 1988 law that privatized Air Canada requires the airline’s maintenance to be conducted in the three cities. Air Canada says it’s following the law even though it’s looking for foreign firms to perform heavy duty maintenance of its 250 planes.

When Transport Minister Denis Lebel handed the issue to the Commons transport committee to study, he said the government was concerned with the 2,600 unemployed workers, but Aveos was a private company. The government was so concerned that its MPs promptly forced a motion through the committee that they wouldn’t report their conclusions to Parliament. The procedural reasoning for this move is fatuous at best.

The debate pivots around a ruling last summer by Justice Frank Newbould of the Ontario Superior Court.  He ruled the Air Canada Public Participation Act was vague and that by servicing its planes in so-called line maintenance centres in the three cities, the airline was in compliance with the law. This is where the routine preparation for flight type inspections and work is carried out. Aveos was conducting about 90% of the major overhaul work on the planes.

That ruling is almost a year old, but the Harper government has only decided now that the legal issue needs to be studied. Sounds like someone wasn’t really paying attention.

The judge was ruling on a claim by the International Association of Machinists and Aerospace Workers that Air Canada had effectively breached the privatization law through the spin-off of Aveos, formerly Air Canada Technical Services, to private owners.

Air Canada insists it is onside with all aspects of the law. “We continue to employ 2,300 maintenance employees at various bases in Canada, including those in Vancouver, Winnipeg, Toronto and Montreal,” said Air Canada spokesman Peter Fitzpatrick.

However, it was clear when Air Canada was being privatized that all aircraft maintenance was to remain in Canada. And Transport Canada hasn’t said what it intends to do to ensure that aircraft maintained outside Canada, most likely at low cost centres, are safe.

Lebel parrots the same line in Question Period and when walking away from reporters. “Air Canada must respect its privatization agreement and we’ll assure this. The law on Air Canada requires that we maintain the [maintenance] centres, and we will comply with the law."

Lebel said other companies in Canada could handle airline maintenance. The IAMAW says there really is no company capable of replacing Aveos. Operations in Trois-Rivieries and Windsor are too small.

Quebec Premier Jean Charest has threatened to sue the federal government and Air Canada. Manitoba has also threatened to sue. The provinces are trying to get Ontario to support them.

Air Canada’s stormy labour relations have already become a major saddle sore for the job-obsessed Harper government. Now it faces a major controversy over the maintenance issue, and by implication, aviation safety.