Wednesday , August 10 2022

High Frequency Train: Better Without Quebec? | Business | The Right



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This secret was received by the Canadian press under the Access to Information Act.

The publication of this note comes at a time when Via seeks financial support for the construction of new railways that would provide a greater frequency for trains, reduce travel time and separate rail transport activities. passengers and goods.

The assessment made for "Canadian Transport" shows that the inclusion of a section between Montreal and Quebec would affect the cost-effectiveness of the project, according to an information document prepared at the beginning of the year for Deputy Finance Minister Paul Rochon.

This study, conducted by EY, recommends a revision of the Quebec section due to "high capital costs and poor operating results", the document says. federal.

One of the key factors for the success of the project is finding a way to make it more attractive to private sector investors.

The document explains that Via has presented an optimistic argument for his high-frequency train project.

"Via predicts that the project will recover its capital costs and generate a net surplus on its network between Toronto and Quebec City due to a significant increase in revenue and revenue," the informational note given to Mr. Rochon.

According to the study, the project requires a cost of 4.4 billion dollars, including 1.14 billion dollars for the Montreal-Quebec section. To finance her fully, Via will have to find a private investment. The company will have to assure potential investors that their project will allow them to make money.

A Via Rail spokesman, Marie-Anna Murat, sent by e-mail that the surveys cited in the note refer to the original proposal submitted by Via Rail to the government in 2016

She added that this study was not conducted for Via.

Making a profit will be a complete turnaround for the Crown corporation.

For example, in its 2018 annual report, Via admits that her service in Montreal-Ottawa-Toronto had a deficit of nearly $ 93 million after transporting an average of around 49,000 passengers a week.

The deficit in services between Quebec City, Montreal and Ottawa last year was nearly $ 24 million. About 17,000 people used this train on a weekly basis.

unprofitable

According to Matti Semiaticki, a professor at the University of Toronto, research shows that high-speed and high-speed rail lines rarely cover their investment and operating costs.

According to him, Via's analysis is very optimistic.

Mr. Semyatikki admits that the company is in a "difficult situation". He congratulates her on trying to find a way to move the project forward. It presents good arguments from an environmental and social point of view, but remains difficult to define as a good business opportunity.

"It will be interesting to see if it can find investors who will actually risk their own capital at what seems to be a very risky proposition," he said.

The federal disclosure document also cites a previous separate analysis that the high-frequency project may reduce Via's dependence on public funding in the corridor, especially if part of Toronto-Ottawa-Montreal is completed.

A few weeks ago, the government announced it would give $ 71 million to better analyze the cost-effectiveness of the project. Part of the funding will come from the Canadian Infrastructure Bank.

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