Wednesday, September 30, 2009

Fifth Estate RIDING ON RISK air safety Replay

Fifth Estate

RIDING ON RISK
: Disturbing allegations about our safety in the air. How well is our government protecting our safety and security? View the web feature
Wednesday, September 30 at 1 & 4 a.m.

Replay

Tuesday, September 29, 2009

Bad news for Ignatieff’!

Federal Conservatives Widen Lead over Liberals

[TORONTO – September 26, 2009] – The threat of a federal election is still looming but not much has changed in the minds of Canadian voters, a new Angus Reid Strategies/Toronto Star poll has found.

The Canadian Political Pulse has found that the Conservative Party is up one point since a mid-September poll, to 37 per cent; the Liberals have remained stagnant at 29 per cent. The New Democratic Party is down one point to 16 per cent, the Bloc Québécois is down to 9 per cent (-1), and the Greens have added one point to reach eight per cent.

“The threat of an election has only increased the Conservative lead,” said Jodi Shanoff, Vice-President of Public Affairs at Angus Reid Strategies. “Despite his advertising Ignatieff has not been able to close the leadership gap with Harper.”

Though voting-intention may not be showing a great shift, there is some movement in the way Canadians perceive the party leaders. Prime Minister Stephen Harper’s momentum stands at -20, meaning that 11 per cent of respondents now have a better opinion of him than three months ago, while 31 per cent have a worse opinion of him. Liberal leader Michael Ignatieff scores a worse momentum of -32. The NDP’s Jack Layton scores a negative momentum of -10, and the BQ’s Gilles Duceppe’s sits at -6.

Ignatieff’s momentum is worse than Harper’s for the first time since the Canadian Political Pulse has been asking this question with Ignatieff as Liberal leader.

In the category of preferred prime minister, the incumbent is ahead with 27 per cent, followed by the Liberal leader with 16 per cent, Layton with 12 per cent, and both Duceppe and Green Party leader Elizabeth May with three per cent. Just over a fifth (22%) of Canadians say that none of them is well suited to head the government.


Leadership and Issues

Canadians think Prime Minister Harper is best suited to deal with the economy (33%), health care (23%), and crime (38%) than Ignatieff, who scores 23 per cent, 16 per cent and 12 per cent in these issues, respectively. Ignatieff is trusted by most Canadians on handling foreign affairs (30%, followed closely by Harper at 28%).

Layton is a close second to Harper on health care (22%), and is preferred by more people to handle the environment (27%, compared to Harper and Ignatieff, both at 17%).

Canadians describe the current prime minister as mostly secretive (45%), boring (44%), and intelligent (43%). They qualify Ignatieff as primarily arrogant (51%), intelligent (46%) and out of touch (39%).


Regions

Support for the Conservatives remains especially high in Alberta (61%), and Manitoba and Saskatchewan (47%). Notably, the Tories are also very strong in Ontario (44%). The Grits remain particularly strong in Atlantic Canada (57%), and in Quebec (26%).

British Columbia (23%) and Atlantic Canada (21%) continue to pull the numbers up for the NDP. Ontario (10%), Manitoba and Saskatchewan (10%), and BC (14%) hold the highest number of Canadians supporting the Greens.

Sunday, September 27, 2009

I love this facebook page!!

Tell Harper we want him to apologize for threatening the planet and damaging Canada's reputation.

If enough join within 24 hours we can get international media to talk about how Canadians feel about Harper choosing donuts over planet.

Harper Chooses Donuts Over Planet - Tell Him What You Think

Saturday, September 26, 2009

Transport Canada. V the fifth estate / Hana Gartner .

In its many years of bringing investigative reports to Canadians, the fifth estate has had its share of alarming stories. This season debuts with startling and disturbing allegations about the people we depend on to ensure our safety when we fly. The story begins with an urgent e-mail to the fifth estate.

The writer says she has “come across interesting, internal information from Transport Canada.” The sender: a journalism student who has found a USB key/computer memory stick in a coffee shop. The student’s discovery contains interesting information indeed. There are warnings from a security inspector at Canada’s biggest airport alleging public safety is being compromised because security and safety regulations are being circumvented in favour of profit and convenience.

In Riding on Risk, reporter Hana Gartner talks to whistle blowers who have risked their livelihoods to try to change a system that they believe is putting passengers and airline employees in grave and needless danger – at the airports and in the air. We’ll also meet Kirsten Stevens of British Columbia, a woman whose logger husband boarded a routine flight one day, promising to be home in time for dinner with her and their three children. But, the small float plane carrying him crashed and all aboard were killed. Kirsten assumed Transport Canada would investigate. She was shocked when she realized they had closed their file on the crash. She did her own meticulous investigation and pinpointed a mechanical failure that may have led to her husband’s death. Since then, she has become a crusader, and a magnet, for whistle blowers inside the industry desperate to share their concerns about aviation security and safety.

Finally, the fifth estate takes the investigation to federal Minister of Transport, John Baird. Hana Gartner gives the Minister the opportunity to respond to the allegations and asks the question that should be on the minds of anyone in Canada who flies: should industry, concerned about saving money and cutting corners, be the same people to worry about safety?

Friday, September 25, 2009

SCC Case Information Prime Minister of Canada, et al. v. Omar Ahmed Khadr

SCC Case Information

Summary

33289

Prime Minister of Canada, et al. v. Omar Ahmed Khadr

(Federal Court) (Civil) (By Leave)

Keywords

Constitutional Law.

Summary

Case summaries are prepared by the Office of the Registrar of the Supreme Court of Canada (Law Branch) for information purposes only.

Constitutional law - Charter of Rights - Right to life, liberty and security of person - Fundamental justice - Remedy - Crown prerogative in matters of foreign relations - Interviews conducted in Guantanamo Bay by Canadian officials who knew that Canadian child had been subjected to sleep deprivation techniques - Refusal of the Canadian Government to repatriate its national - Whether the lower courts could find that s. 7 of the Canadian Charter of Rights and Freedoms has been breached and that the breach was not justified under s. 1 - Whether the lower courts could find that the Government had a duty to protect its national - Whether it was open to the lower courts to order the Government to request the repatriation of its national.

Mr. Khadr, a Canadian citizen, was taken prisoner in Afghanistan when he was 15 years old and has been detained by U.S. Forces since 2002 at Guantanamo Bay, Cuba, where he is currently facing murder and other terrorism-related charges. During his detention, Mr. Khadr was given no special status as a minor. He was not allowed to communicate with anyone outside Guantanamo Bay until November 2004, when he met with legal counsel for the first time. The Canadian Government has asked, through diplomatic channels, for consular access and other assurances, but it is its policy not to request his repatriation until the conclusion of the prosecution. In 2003, Canadian officials questioned Mr. Khadr, still a minor, at Guantanamo Bay, with respect to matters connected to the charges he is now facing, and shared the product of these interviews with U.S. authorities. In 2006, after formal charges were laid against him, Mr. Khadr sought disclosure in Canada of, notably, the records of the interviews conducted at Guantanamo Bay. The Supreme Court of Canada ordered the disclosure. After the information was disclosed, it became clear that when the officials interviewed Mr. Khadr, they were aware that he had been subjected to a form of sleep-deprivation, known as the “frequent flyer program”, to make him more amenable and willing to talk.

Mr. Khadr asked the Canadian Government to repatriate him, but to no avail. He sought judicial review of the policy and decision of the Canadian Government not to seek his repatriation.

Thursday, September 24, 2009

U.S.-style prisons in Canada. ?

The Conservative government plans to bring in an American-style prison system that will cost billions of taxpayer dollars and do little to improve public safety, according to a report released Thursday in Ottawa.

"It tramples human rights and human dignity," University of British Columbia law professor Michael Jackson, co-author of the 235-page report, A Flawed Compass, told reporters.

Moreover, there is "a near total absence of evidence" in the government plan that its measures will "return people to the community better able to live law-abiding lives," said co-author Graham Stewart, who recently retired after decades as head of the John Howard Society of Canada.

Their report provides a scathing review of a government blueprint for corrections called A Roadmap to Strengthening Public Safety. A panel led by Rob Sampson, a former corrections minister in Ontario's Mike Harris Tories, drafted the plan, which is being implemented by the Correctional Service.

In addition to constructing super prisons and implementing work programs, the program will eliminate gradual release and deny inmates rights that are now entrenched in the Constitution.

Rather than enhancing public safety, the measures will undermine it by making prisons more dangerous places and constricting inmates' reintegration into society, said Jackson.

By keeping prisoners locked up longer, the plan places an enormous financial burden on taxpayers, he added.

Perhaps worst of all, Jackson said, it "will intensify what the Supreme Court has characterized as the already staggering injustice of the overrepresentation of aboriginal people in the prisons of Canada."

A recipe for prison violence: Jackson

By stressing punishment rather than rehabilitation, the plan ignores lessons of the past, which led to the prison riots and killings that dominated Canadian news in the early 1970s, said Jackson.

"My greatest fear is with this road map's agenda and its underlying philosophy, we will enter a new period of turmoil and violence in Canadian prisons," he said.

"I do fear that prisons will become more abusive, prisoners will become more frustrated and that we could go back to a time not only when the rule of law was absent but a culture of violence is the dominant way in which prisoners express their frustrations."

Stewart called the blueprint "an ideological rant, which flies in the face of the Correctional Service's own research of what works to rehabilitate prisoners and ensure community safety."

"The fact is that you cannot hurt a person and make them into a good citizen at the same time."

The government has already allocated hundreds of millions to the plan, even though it has had no input from either Parliament or the public, according to the report. It has not yet responded to the report.

Correctional Service of Canada (CSC) Response to the Office of the Correctional Investigator's Deaths in Custody Study, the Correctional Investigator'

Correctional Service of Canada (CSC) Response to the Office of the Correctional Investigator's Deaths in Custody Study, the Correctional Investigator's Report: A Preventable Death and the CSC National Board of Investigation into the Death of an Offender at Grand Valley Institution for Women

Safeguarding the security and well-being of staff and offenders within our institutions is one of CSC 's fundamental responsibilities. CSC staff strive to provide offenders with an environment that is safe and secure where they receive appropriate treatment, programming and essential health care while they address the issues that led to the commission of their offences. This support assists offenders to become law-abiding citizens. It is through this work that CSC contributes to public safety.

CSC faces the difficult challenge of managing a significant number of high-needs offenders. The majority of offenders are admitted with drug or alcohol problems and the number of offenders convicted of violent offences has increased. Many offenders enter CSC institutions with identified mental health and behavioural problems, while others enter the system with no previous diagnosis or assessment of these needs.

Our staff work diligently to identify and address the needs of this population. They understand that addressing the needs of offenders with mental health problems in particular, not only reduces offenders' self-harming behaviours, but also reduces the risk they pose to others.

The death of any offender is a very tragic event and such events are taken very seriously by CSC. Despite best efforts to maintain offender safety and well-being, deaths in custody do occur. Any time an offender dies while in our custody, CSC conducts an investigation in an effort to prevent and reduce the occurrence of similar incidents in the future. In an effort to learn from these events, CSC develops and implements action plans, identifies significant findings and shares these with other institutions.

In 2007, the Office of the Correctional Investigator (OCI) released its Deaths in Custody Study which examined the circumstances surrounding 82 deaths that were not due to natural causes between 2001 and 2005. The Study also included a number of recommendations aimed at reducing future offender deaths.

Every day, thousands of correctional staff across the country interact with more than 13,000 incarcerated offenders in efforts to assist them with their rehabilitation and intervene when they are in distress.

We recognize the difficult reality, that despite the measures we have taken and those we plan to introduce in the future, some deaths in custody may not be preventable. However, we are committed to continuously identifying opportunities to improve our ability to anticipate and respond to these incidents, and to take all measures possible to prevent the death of offenders.

During the past five years, CSC has taken steps to reduce deaths in custody. We have improved many of our security practices and added better security equipment. Emphasis has been placed on our dynamic security practices based on the ongoing observation and interaction with offenders to prevent security incidents from happening and, if they do, to effectively address them in an expeditious manner.

We are continuously improving the range of correctional programs provided to offenders. Our programs are research-based and address a wide range of issues that may lead to criminal activity including violence, family violence, sexual offending, substance abuse and general criminality. CSC has also developed programming and interventions designed specifically for women, Aboriginal and special needs offenders. There is solid evidence that programs, based on sound research and theory, significantly contribute to the safe reintegration of offenders into the community.

The October 2007 death of offender Ashley Smith further highlighted issues of offender safety and the provision of treatment to offenders who demonstrate mental health and/or behavioural needs.

Improving CSC 's capacity to address offenders' mental health needs is one of our strategic priorities. We have developed an integrated Mental Health Strategy and implementation in many areas is under way, including enhanced mental health screening at intake and additional resources in regular institutions to provide care and support to offenders. We are also developing improved strategies for information sharing among key operational staff, intervening when offenders are in distress, and strengthening managerial accountabilities throughout the organization as they relate to preservation of life as well as deaths in custody.

CSC is working with its counterparts at the provincial and territorial levels as well as various subject matter experts and agencies to enhance our policies and practices around deaths in custody. In March 2009, we met with provincial and territorial Coroners and Chief Medical Examiners to dialogue on how to better address the issue of deaths in custody. We also convened a meeting of Federal, Provincial, and Territorial Heads of Corrections representatives to discuss and review best practices around preventing deaths in custody and to produce a summary of findings to share with all CSC staff. In addition, a forum was held in June 2009 to explore the nexus between Canada 's mental health and criminal justice systems. Participants examined the system-wide challenges to addressing mental health issues within the criminal justice system and mental health field, with the goal of formulating future steps and furthering the dialogue on how to address these challenges. The document below details the overall response CSC has developed with respect to the recommendations of the OCI Deaths in Custody Study, their investigation into the death of Ashley Smith and CSC 's own national investigation into her death. Some of the commitments outlined in the document have already been achieved. Others require ongoing work and attention over the longer term and are being addressed.

To ensure transparency and increase understanding of our efforts to effectively manage offenders with mental health and behavioural needs, CSC is making its response publicly available and will be working closely with the OCI to provide regular updates on our progress against the commitments.

Recommendation CSC Response Key Actions/Commitments

Recommendation 1: (Supported)

The Office of the Correctional Investigator recommended that CSC implement and apply as widely as possible (including within men's facilities) all recommendations emanating from the CSC National Board of Investigation into the Death of an Offender at Grand Valley Institution and the Independent Psychological Report produced by Dr. Margo Rivera as part of that investigation.

CSC has categorized the recommendations as follows:

  • Administrative segregation
  • Institutional transfers
  • Security practices and Use of Force Interventions
  • Service and support for women offenders with significant mental health and/or behavioural needs
  • Training, staffing and resourcing
  • The Women Offender Sector's role and mandate
  • Values, ethics and disclosure

CSC acted immediately, following the death of Ashley Smith, to investigate and report on the circumstances surrounding her death and to take corrective action where necessary.

CSC is addressing all recommendations from its National Board of Investigation and the Independent Psychological Report produced by Dr. Margo Rivera, which formed part of the CSC investigation, as they relate to women's facilities.

As well, CSC will continue to assess and apply the learning from these reports to men's facilities.

ADMINISTRATIVE SEGREGATION

CSC is taking steps to improve policies surrounding the incarceration of women offenders exhibiting mental health and/or behavioural needs in general, and in particular those placed in administrative segregation. As part of these improvements, CSC is undertaking the following initiatives:

  • CSC has reviewed its capacity to address the needs of women offenders with mental health and behavioural needs. Short and long-term strategies have been developed on service, support and accommodation needs for women offenders identified in this group and will be pursued through regular Treasury Board processes.
  • CSC has expanded its inter-disciplinary team approach to now include more precisely defined roles for Health Care and Psychology in the review process prior to, as well as during segregation placements.
  • Secure interview rooms in the Secure Units of women's facilities are being created to allow for a separate space for staff and stakeholders to interact with offenders within a safe setting. Four out of five of these secure interview rooms are now being used. The fifth room will be ready for use in August 2009.
  • CSC will undertake by April 2010 an operational examination of long-term segregation using a representative sampling methodology and an external review process.
Recommendation 1 - Continued

INSTITUTIONAL TRANSFERS

  • To ensure that the offender's mental health needs are explicitly considered in all transfer decisions, the Commissioner's Directive 1 on transfers of offenders has been reviewed and is being amended. Amendments are expected to be finalized by September 2009. In the interim, a Case Management Bulletin was issued on May 9, 2008 to remind staff of paragraphs in Commissioner's Directive on prevention, management and response to suicide and self-Injuries, and to ensure that they apply the policy direction in the event of the transfer of relevant cases. The policy requires that no inmate considered imminently suicidal or self-injurious be transferred to an institution other than a treatment facility unless the Psychologist managing the case, in consultation with other health service professionals, deems that the transfer would reduce or eliminate the inmate's potential for suicide or self-injury.
  • CSC has acted to address the increase in federally-sentenced women offenders and the resultant population pressures in its women's facilities by adding 45 beds to its women's institutions in general during fiscal year 2008-2009 (Fraser Valley Institution in British Columbia: eight beds; Grand Valley Institution for Women in Ontario: 30 beds; and Nova Institution for Women in Nova Scotia: seven beds).
Recommendation 1 - Continued

SECURITY PRACTICES AND USE OF FORCE INTERVENTIONS

CSC has implemented new procedures to strengthen accountability in its security practices and use of force interventions. In addition, the issue of preservation of life has been communicated and reinforced extensively across the organization to all levels of staff. Specific discussions have taken place at the Executive Development Symposium for all senior leaders of the organization, at all regional management committee meetings and major union meetings at all sites across the country.

  • In May 2008, CSC issued a Security Bulletin to clarify �immediate intervention� in response to suicidal and self-injurious offenders. Specifically, any item used by an offender to inflict or attempt to inflict self-harm requires an appropriate and immediate intervention by staff that is both safe and reasonable in order to seize/retrieve the item. The bulletin emphasized that preservation of life is the primary goal of the intervention.
  • On April 1, 2009 , CSC revised its Use of Force policy to include:
    • the ability of Correctional Managers, Crisis Managers and/or the Institutional Head to develop an �intervention plan� using line staff to manage a situation;
    • the requirement to expedite use of force reviews of incidents that are identified by the Institutional Head as having serious violations of legislation or policy, or any other aspects which may cause serious concerns. This will ensure that serious incidents where staff have had to use force to manage offenders are reviewed quickly, issues identified, and corrective actions completed; and
    • the reinforcement in policy of the current Guidelines for Health Services Responsibilities Related to Use of Force Incidents that allow for the use of certified first aid attendants, in the absence of a health care practitioner, to conduct post use of force first aid assessments.
Recommendation 1 - Continued

SERVICE AND SUPPORT FOR WOMEN OFFENDERS WITH SIGNIFICANT MENTAL HEALTH AND /OR BEHAVIOURAL NEEDS

To enhance service and support for women offenders with mental health and/or behavioural needs, CSC has implemented a number of initiatives including:

  • Assessing 14 women offenders, identified as having significant mental health and/or behavioural needs, using external clinical expertise to better inform their management.

In addition, CSC has developed an internal Mobile Interdisciplinary Treatment Assessment and Consultation Team (MTAC) to assist with complex mental health cases. M TAC is an on-demand mobile skills-building team, comprised of CSC experts from various backgrounds. Members of the team provide consultation services to institutional staff as needed.

  • On Aug. 1, 2009, CSC expanded the MTAC to include male offenders who exhibit significant mental health and/or behavioural needs.

CSC has also expanded its inter-disciplinary team approach to now include more precisely defined roles for Health Care and Psychology in the review process prior to, as well as during, segregation placements.

  • The Assistant Deputy Commissioners, Institutional Operations, Deputy Commissioner for Women and Wardens of women's institutions meet quarterly to discuss issues pertinent to women's facilities. Women's institutions share best practices as they relate to institutional operations. Discussions resulting from these meetings are documented for distribution to women's facilities and Regional Headquarters.
Recommendation 1 - Continued

TRAINING, STAFFING AND RESOURCING

CSC has taken steps to ensure that training in mental health and dialectical behaviour therapy is provided to both managers and staff dealing with high-needs offenders. During fiscal year 2008-2009, CSC focused on the training of managers. Training of staff will continue during fiscal year 2009-2010 and beyond.

  • CSC has also completed a pilot project on integrated mental health awareness and security training for front-line health, security and management staff, the three key groups critical to success in the effective management of the unique needs of women offenders. In 2009-2010, mental health training will be provided to Correctional Officers.
  • CSC has developed a strategy to fill vacant positions at Grand Valley Institution to ensure that staff are in place, trained and effectively interacting with offenders. One hundred per cent of Primary Worker (correctional officer) positions are currently staffed, and a strategy is in place to ensure ongoing recruitment for future vacancies . The key management team positions have been fully staffed with the exception of two which are expected to be staffed by the end of September 2009.
  • During fiscal year 2008-2009, CSC Psychologists received additional training in suicide risk assessment by an expert in forensic suicide assessment and prevention.
Recommendation 1 - Continued

WOMEN OFFENDER SECTOR'S ROLE AND MANDATE

CSC has taken steps to communicate and reinforce to staff and stakeholders the Sector's role as the functional authority on women offenders. As such, the Sector provides guidance and advice to regional and institutional staff on corporate policy. Decisions related to the daily management of offenders remain with the Wardens of women's facilities, Regional Deputy Commissioners, and the Assistant Deputy Commissioners, Institutional Operations.

Recommendation 1 - Continued

VALUES, ETHICS AND DISCLOSURE

CSC is committed to ensuring that all staff members conduct themselves within the highest ethical standard.

  • To reinforce the importance of values and ethics, CSC is developing local ethics advisory committees and is in the process of establishing them at select operational sites. CSC is also providing a variety of workshops to staff members throughout CSC at all levels that include both operations and management. Regional Deputy Commissioners are also reinforcing to Wardens the importance of holding unit and town hall-type meetings to encourage increased staff dialogue and interaction.
  • CSC is examining ways to increase its capacity to deliver additional Values and Ethics workshops across the Service.
  • CSC is in the process of enhancing staff awareness of the Office of Internal Disclosure underscoring its availability to all CSC employees.

1 Commissioner's Directives are rules prescribed for the management of the Service as described in Section 97 of the Corrections and Conditional Release Act

Recommendation CSC Response Key Actions/Commitments

Recommendation 2: (Supported)

The Office of the Correctional Investigator recommended that the Correctional Service provide a full public accounting of its response to the OCI Deaths in Custody Study. This should include a detailed action plan with clearly identified outcomes and timeframes.

Six themes have been identified that relate to the Deaths in Custody Study and CSC has categorized them as follows:

  • Dynamic Security
  • Ongoing Assessments
  • Need to Enhance Provision of Intervention Services
  • Physical Infrastructure Deficiencies
  • Strengthening Managerial Accountabilities
  • Additional Actions

The posting of this document is an important step in publicly sharing the initiatives that the Service is pursuing to address the issues identified in the Office of the Correctional Investigator study on deaths in custody. The corresponding actions contained in this document relate to recommendations made by the Office of the Correctional Investigator in the Deaths in Custody Study and his investigation into the death of Ashley Smith as well as CSC 's own Board of Investigation into her death.

DYNAMIC SECURITY

Dynamic security is a key method of ensuring safety within our institutions. It requires that CSC staff members engage and interact directly with offenders to develop and maintain a knowledge of behaviours or factors that may compromise the safety of staff, offenders or the institution at large. As part of this process, staff members observe, speak with and interact with offenders in a meaningful way on a daily basis. CSC is taking the following steps to enhance dynamic security:

  • Revising the Commissioner's Directive on Dynamic Security by fall 2009 to provide more direction with regard to responsibilities of both management and staff;
  • Placing additional emphasis on dynamic security within the Correctional Training Program for Correctional Officers. The new Correctional Officer Training Program was piloted and is currently being delivered in the Pacific and Ontario regions. It is expected to be available in all other regions by March 31, 2010;
  • Developing a Dynamic Security refresher course by 2010;
  • In April 2009, letters of expectation were distributed to all Correctional Managers to ensure that staff members are supervised consistently and that issues are brought to management's attention in a timely fashion;
  • In December 2008, a Security Bulletin was issued to remind all Correctional Officers of their responsibilities with regard to security patrols and counts and the importance of their observations of offender activities in all areas of the institution. As well, all Correctional Managers were reminded of their responsibility to provide constructive feedback to Correctional Officers when necessary;
  • An additional stand-to inmate count was introduced on July 10, 2009 at all maximum, medium, minimum, and multi-level institutions between the hours of 6:00 p.m. and 12:00 a.m. As well, as an increase in security patrols at all maximum, medium and multi-level institutions (excluding women's institutions) was introduced at the same time. CSC has confirmed that all institutional policies (standing orders and post orders) are in compliance with the Commissioner's Directive on Inmate Counts and Security Patrols. Furthermore, regions are randomly analysing their inmate counts and security patrols on a quarterly basis and reporting their results to National Headquarters and taking corrective action when necessary;
  • CSC has initiated a project to install high-resolution digital cameras in the cell range areas of all women's institutions. The project is scheduled to be completed in June 2011; and
  • CSC is examining the use of alternate systems, including proximity card technology that identifies, tracks, and records the presence of Correctional Officers conducting security patrols and inmate counts, and is exploring the use of new technologies to enhance security and increase staff ability to verify offender well-being, especially during the night shift.
Recommendation 2 - Continued

ONGOING ASSESSMENTS

Effective screening for mental health issues is key to ensuring the safety and security of offenders and staff within our institutions. CSC has taken the following steps to improve screening.

  • An enhanced mental health screening tool was implemented at 13 intake assessment sites in fiscal year 2008-2009. Using empirically validated tools, offenders are being screened for depression, suicide risk and feelings of hopelessness. The tool will be in use at all 16 intake assessment sites by the end of fiscal year 2009-2010.
  • During fiscal year 2008-2009, CSC Psychologists were provided training in suicide risk assessment by an expert in forensic suicide assessment and prevention.
  • Guidelines on sharing mental health-related information will be developed by CSC and shared with staff to provide important reference points to follow when staff are considering what can be shared and under what circumstances. These guidelines will be in place by December 2009.
Recommendation 2 - Continued

NEED TO ENHANCE PROVISION OF INTERVENTION SERVICES

CSC is taking steps to ensure adequate staff and resources are available to provide intervention services to offenders. As part of our efforts, CSC is proceeding with a review of the resources available and allocated to the care of women offenders to ensure their efficient use and capacity to achieve correctional results. The completion of the review is planned for summer 2009. Other steps taken include:

  • New deployment standards for correctional staff implemented in April 2009.
  • Developing a more effective approach to offender case management by focusing psychological and specialized assessment resources on the highest risk/needs offenders. It will be in place by the end of fiscal year 2009-2010.
  • As part of amendments to the Commissioner's Directive on Prevention, Management and Response to Suicide and Self-Injuries, CSC will gather information about the use of psychological and psychiatric services in the assessment and intervention of offenders at risk for suicide or self-injury. Consultation on this phase of amendments will begin in March 2010.
  • An expert consultant is advising CSC on best practices in the assessment of risk of suicide and self-injury and in intervention techniques for offenders at risk. The advice will assist CSC 's efforts to make improvements to the existing Commissioner's Directive on Prevention, Management and Response to Suicide and Self-Injuries. The consultant is expected to provide advice on processes to allow for the sharing of information between staff when an inmate is exhibiting suicidal or self-harming ideations.
  • CSC has adapted the Women's Violence Prevention Program to allow for delivery to women offenders in the Secure Units or Segregation Units. This will be piloted by fall 2009.
Recommendation 2 - Continued

PHYSICAL INFRASTRUCTURE DEFICIENCIES

CSC 's physical infrastructure does not necessarily allow for the continuous surveillance of offenders and intervention efforts when needed. As a result, CSC is compiling a review of construction-related deficiencies identified in reports, reviews and investigations to develop appropriate criteria for future construction projects. Mitigating strategies for identified deficiencies will be developed during 2009-2010.

Recommendation 2 - Continued

STRENGTHENING MANAGERIAL ACCOUNTABILITIES

Strong managerial accountabilities are key to assisting CSC in effectively responding to and preventing deaths in custody.

  • CSC has made considerable progress over the past year in improving the quality of its investigations and ensuring that they are completed within newly-established timeframes. The policy provides for normal investigations to be completed and prepared for Senior Management review for closure within six months from the date of the incident. In certain circumstances the investigative process may take longer because of different complexities. If necessary, CSC implements corrective measures immediately following incidents at the local level while the investigative process gets underway.
  • Quarterly summaries highlighting all pertinent issues and statistical information around deaths in custody (excluding deaths by natural causes) will be shared with the Office of the Correctional Investigator commencing in September 2009. In addition, these summaries will be provided to all regional and institutional management committees to share all findings and management actions as part of their meeting agendas on a quarterly basis commencing in October 2009.
  • An independent review group will be formed to assess CSC 's actions and responses to deaths in custody on an annual basis. A proposed membership and terms of reference for this group will be developed by the end of September 2009.
  • All deaths in custody are investigated by the Service under Section 19 of the Corrections and Conditional Release Act . The findings and recommendations resulting from these investigations lead to the development of corrective measures/action plans at the operational, regional and/or national levels as appropriate, and are monitored for verification purposes.
  • Findings and issues raised in reports are used to develop and implement action plans and significant findings. CSC shares these with the applicable operational unit so that staff can learn from the incident. These are also shared with other institutions so that CSC can reduce the chances of similar future incidents.
  • Regular meetings of the Executive Committee include review of the investigation reports and corrective measures for each death in custody. The results of these reviews are then shared at the regional and operational levels.
Recommendation 2 - Continued

ADDITIONAL ACTIONS

  • CSC 's commitment to enhancing our capacity to assess and respond to issues related to preventable deaths in custody has been included in the Report on Plans and Priorities to Parliament for 2009-2010.

Recommendation CSC Response Key Actions/Commitments

Recommendation 3: (Not Supported)

The Office of the Correctional Investigator recommended that CSC group its women facilities under a reporting structure independent of the regions, with the Wardens reporting directly to the Deputy Commissioner for Women.

CSC recognizes the need for a strong and effective governance structure to ensure that women offender issues receive the required corporate attention. Extensive discussion and review has occurred on this subject and it was determined that a functional authority for the Deputy Commissioner for Women was the most effective governance structure. The CSC Review Panel also supported the functional authority model. The Regional Deputy Commissioners have full and direct line authority over the women offender institutions and direct the activities of the Assistant Deputy Commissioners, Institutional Operations who are responsible for managing operational issues. The Deputy Commissioner for Women works in co-operation with the Regional Deputy Commissioners and supports the Wardens of the women offender institutions through collaboration with the Assistant Deputy Commissioners, Institutional Operations.

CSC continues to believe that a robust functional role and strong leadership by the Deputy Commissioner for Women, rather than a line authority model, is the most appropriate approach. The roles and responsibilities of the Deputy Commissioner for Women have been clarified and communicated to National Headquarters, the regions and the women's institutions.

  • The role and responsibilities of the Deputy Commissioner for Women and the Women Offender Sector have been clarified and communicated to National Headquarters, the regions and women's institutions.
  • Ongoing discussions will take place to clarify for the Office of the Correctional Investigator how issues of concern in women's facilities can be brought to the national level when some urgency or serious difference of opinion exists relating to the care provided to women offenders.

Recommendation CSC Response Key Actions/Commitments

Recommendation 4: (Supported)The Office of the Correctional Investigator recommended that CSC issue immediate direction to all staff regarding the legislated requirement to take into consideration each offender's state of health and health care needs (including mental health) in all decisions affecting offenders, including decisions relating to institutional placements, transfers, administrative segregation and disciplinary matters. CSC decision-related documentation must provide evidence that the decision-maker considered the offender's physical and mental health care needs.

CSC has provided direction to its operational staff to reinforce the importance of the requirement to take into consideration each offender's state of health and health care needs in all decisions, including regional administrative segregation reviews.

The Commissioner's Directive on Administrative Segregation was amended in November 2007 to make the following changes:

  • New annexes were created to provide guidelines for:
    • Segregation Placement/Admission,
    • Segregation Review Board Report Content, and
    • Mental Health Assessment for Administrative Segregation.

Each of these guidelines requires that an offender's state of health and health care needs be explicitly considered and documented when making an administrative segregation decision. In 2010-2011, CSC will conduct a management review to assess the level of compliance with this direction.

  • Changes in policy objectives, expanded definitions and the formalization of a number of principles;
  • Clearer identification of roles and responsibilities in administrative segregation at the national, regional, and institutional levels;
  • Clearer direction on responsibilities related to administrative segregation;
  • Provision of psychological opinions for administrative segregation cases; and
  • Establishing a role for Health Care and Psychology to supplement the existing review mechanisms for long-term segregation placements.

As well, a segregation handbook for staff has been produced and distributed to clarify the policy expectation for the timely review of these cases.


Recommendation CSC Response Key Actions/Commitments

Recommendation 5: (Supported)

The Office of the Correctional Investigator recommended that CSC immediately review all cases of long-term segregation where mental health issues were a contributing factor to the segregation placement. Particular attention should be paid to inmates with histories of suicide attempts or self-injurious behaviours. Results of this review should be provided to the institutional heads and Regional Deputy Commissioners and, in the case of women offenders, to the Deputy Commissioner for Women.

In each CSC region, the Assistant Deputy Commissioner, Institutional Operations, is responsible for reviewing each long-term segregation case at 60 and 120 days. In addition, they must conduct verifications and site audits to ensure the regional review process has been properly implemented.

CSC continues to rely on registered psychologists to conduct an assessment and evaluate each offender within 25 days of their admission to segregation and every 60 days thereafter. This is in addition to an initial assessment that is completed by a health care professional on admission to a segregation unit.

CSC conducts reviews of all cases where an offender remains on �segregation status� for a period exceeding 60 days. This includes those offenders in the transition and special units in CSC facilities where the offender is segregated from the general offender population. The addition of offenders in transition and special units increases the focus on those offenders where mental health issues were a contributing factor to the segregation placement. Particular attention is paid to offenders with histories of suicide attempts or self-injurious behaviours.

CSC agrees that administrative segregation is a concern in correctional settings and, as a result, will undertake, by April 2010, an operational examination of long-term segregation using representative sampling methodology and an external review process.


Recommendation CSC Response Key Actions/Commitments

Recommendation 6: (Supported)

The Office of the Correctional Investigator recommended that CSC seek independent expertise � with a strong women-centred component � to review its policies on managing self-injuring inmates, and inmates displaying challenging behavioural issues. This review should focus on the appropriateness of placing those inmates on administrative segregation status.

CSC has initiated a review of its policies on managing self-injuring offenders both internally and with the assistance of an expert consultant. Following this work, CSC will be initiating an external operational review of the segregation process.

CSC has reviewed its capacity to address the needs of women offenders with mental health and/or behavioural needs. Short and long-term strategies have been developed on service, support and accommodation needs for women offenders identified in this group.

  • An expert consultant will assist CSC efforts at making improvements to its Commissioner's Directive on Prevention, Management and Response to Suicide and Self-Injuries. Enhancements to the policy will include improved communication to front-line staff of offenders' risk levels and observation status. The expert will also advise CSC on best practices in the assessment of suicide and self-injury risk.
  • Standardized tools and guidelines for use in developing plans to address self-harming behaviours are being developed for use by operational staff and will be finalized by end of August 2009.

Recommendation CSC Response Key Actions/Commitments

Recommendation 7: (Not Supported)

The Office of the Correctional Investigator recommended that all CSC National Boards of Investigation into incidents of suicide and self-injury be chaired by an independent mental health professional.

The Commissioner's Directive on Incident Investigations was revised in August 2007 to indicate that investigations into incidents involving health care issues will normally include a registered health care professional on the CSC Board of Investigation. The present CSC policy allows for greater flexibility in determining and ensuring that the appropriate level of health care expertise and representation is involved during the different types of investigations.

National Boards of Investigation can also seek out and augment their investigative teams, where deemed appropriate, with a wide variety of external experts and specialists.

CSC will continue to use its existing process and ensure that each Board of Investigation understands that it can access a wide variety of external experts and specialists as deemed necessary.


Recommendation CSC Response Key Actions/Commitments

Recommendation 8: (Supported in part)

The Office of the Correctional Investigator recommended that CSC review and revise its administrative segregation practices to ensure that all long-term segregation placements are reviewed by regional managers, inclusive of health care, after 60 days of segregation. They further recommended in those cases where segregation status is maintained, that the decision and supporting documentation be referred to the Senior Deputy Commissioner and, in the cases of women offenders, to the Deputy Commissioner for Women.

The Commissioner's Directive on Administrative Segregation provides guidelines for segregation/admission, Regional Segregation Review Boards, Regional Oversight Managers, how to run a Segregation Review Board, Segregation Review Board report content and providing psychological opinions for administrative segregation cases.

In cases where the regions deem it appropriate, they may refer cases to the Senior Deputy Commissioner or Deputy Commissioner for Women for review and/or advice. As well, the OCI, as has been done in the past, can request the Senior Deputy Commissioner or Deputy Commissioner for Women review a particular case.

  • Regional Segregation Review Boards and Regional Segregation Oversight Managers are in place across CSC to perform the delegated responsibilities of the regional reviews and to ensure that the case of each inmate in segregation is reviewed regionally every 60 days.
  • Regional Segregation Oversight Managers conduct and follow-up on action plans that result from administrative segregation audits.
  • An inmate placed in segregation is visited by a Registered Nurse at the time of admission or without delay, and thereafter daily, to determine whether there are any health concerns resulting from the placement or any concerns for risk of suicide or self-harm.
  • At least once within the first 25 consecutive days of an inmate's placement in segregation and once every subsequent 60 days, a Psychologist will provide a written psychological opinion on the inmate's mental health status at the time of assessment, with a special emphasis on the evaluation of the risk for self-harm.
  • Institutional Segregation Review Boards, which may include ad hoc members such as Health Services staff, conduct hearings within five working days after the inmate's confinement in administrative segregation, and at least once every 30 calendar days following placement.

Recommendation CSC Response Key Actions/Commitments

Recommendation 9: (Supported in part)

The Office of the Correctional Investigator recommended that CSC amend its segregation policy to require that a psychological review of the inmate's current mental health status, with a special emphasis on the evaluation of the risk for self-harm, be completed within 24 hours of the inmate's placement in segregation.

Within 24 hours of admission to segregation, an offender's mental health needs and physical health needs are assessed by a medical professional, and appropriate referrals to psychology are made as required. CSC will continue to draw on its security, intervention and physical and mental health care resources to assess and manage these cases.

  • Currently, the Commissioner's Directive on Administrative Segregation requires that at the time an offender is admitted to administrative segregation:
    • Within 24 hours a Registered Nurse assess whether there are any health concerns resulting from the placement in administrative segregation, including mental health issues such as risk of suicide or self-harm. The assessment will be documented through the relevant sections of the segregation log to ensure these issues are addressed. Appropriate referrals are made to Psychology on an urgent basis. A follow-up reminder will be issued in August 2009 to reinforce the importance of performing and documenting physical and mental health assessments during these daily visits.
  • Policy also requires that upon admission to segregation:
    • a written psychological opinion on the offender's current mental health status with a special emphasis on the evaluation of the risk for self-harm be provided by a Psychologist at day 25 and every 60 days thereafter.
  • Policy also requires that upon admission to segregation:
    • Nursing staff visit the segregation areas on a daily basis to assess offenders and deal with concerns that may arise and seek out additional advice and expertise as required.
  • Correctional officers interact with offenders in the segregation units on a regular basis every day and are able to ascertain any changes in the mood or behaviours of offenders.
  • The Institutional Head or a delegate, not below the level of Correctional Manager, is required to visit segregation once a day to ensure conditions of confinement are in compliance with the law.

Recommendation CSC Response Key Actions/Commitments

Recommendation 10: (Not Supported)

The Office of the Correctional Investigator recommended that CSC immediately implement independent adjudication of segregation placements of inmates with mental health concerns. This review should be completed within 30 days of the placement and the adjudicator's decision should be forwarded to the Regional Deputy Commissioner. In the case of a woman inmate, the adjudicator's decision should be forwarded to the Deputy Commissioner for Women.

CSC does not support the recommendation. However, CSC will be exploring other options that may lead to a revised review process of these segregation placements.

In the interim, CSC has introduced a National Population Management Committee to provide national monitoring of the use of administrative segregation. This committee has met and will meet on a regular basis and has established terms of reference.

The Women Offender Sector will continue to provide input and support and perform a functional oversight role regarding women offenders placed in segregation.

By April 2010, CSC will undertake an operational examination of segregation placements of inmates with mental health concerns using a representative sampling methodology and an external review process.


Recommendation CSC Response Key Actions/Commitments

Recommendation 11 : (Supported in part)

The Office of the Correctional Investigator recommended that the Situation Management Model be modified to require staff give consideration to an offender's history of self-harm and his/her potential for future or cumulative self-harm when determining whether immediate intervention is required.

With respect to the CSC Situation Management Model, the existing model requires staff to consider the offender's �past behaviour� during and throughout the incident in question. This includes giving consideration to an offender's history of self-harm and the potential for future or cumulative self-harm when determining whether immediate intervention is required. However, CSC will clarify that �past behaviour� includes an offender's history of self-harm.

  • The issue of preservation of life as a paramount responsibility has been communicated and reinforced extensively across the organization at all levels of staff, both verbally and in writing. (Security Bulletin dated May 30, 2008)
  • Each incident of self-harm or medical distress is assessed at the operational and regional levels for compliance with policy. Corrective action is taken if necessary.
  • Furthermore, weekly reports containing statistics on offenders who self-harm are sent to the regions to bring their attention to these cases for further action, if required.
  • CSC will issue a bulletin by September 2009 clarifying that �past behaviour� includes an offender's history of self-harm.

Recommendation CSC Response Key Actions/Commitments

Recommendation 12: (Supported)

The Office of the Correctional Investigator recommended that the Senior Deputy Commissioner review all of the complaints and the Service's response to those complaints that were submitted by Ms. Smith during her period of federal incarceration, inclusive of the complaint submitted by Ms. Smith in September 2007 at Grand Valley Institution. A written response to these complaints should be issued and appropriate corrective action and policy clarification should be undertaken.

CSC has completed the review of all known complaints and grievances filed by Ms. Smith.

A written response has been completed for all complaints and grievances submitted and a summary report has been shared with the Office of the Correctional Investigator.

Procedures for collecting and receiving segregation grievances at all institutions were reviewed and recommendations were made to ensure confidential, complete access to the process, as well as expeditious receipt of complaints and grievances across the Service. This was solidified with changes to the Commissioner's Directive on Offender Complaints and Grievances.

A review of the access to the grievance process at Grand Valley Institution for Women occurred and changes were made to ensure timely, effective and appropriate responses.

Training sessions were delivered with the institutional staff at Grand Valley Institution for Women on how to process and respond to grievances.


Recommendation CSC Response Key Actions/Commitments

Recommendation 13: (Supported in part)

The Office of the Correctional Investigator recommended that all grievances related to the conditions of confinement or treatment in segregation be referred as a priority to the institutional head and be immediately addressed.

In response to this recommendation, the Commissioner's Directive on Offender Complaints and Grievances was amended in 2008 to ensure that complaints and grievances submitted by segregated offenders are identified daily and monitored regularly.

Grievance procedures and policies were adjusted to ensure that:

  • On admission to segregation/placed on cell confinement status, offenders be informed they can lodge complaints and grievances about segregation, confinement conditions, and treatment. This includes their right to address sensitive or urgent requests to the Institutional Head in a sealed envelope. The Institutional Head must ensure that complaints and grievances submitted by segregated offenders are collected and reviewed daily. Should the grievance subject warrant high priority as per the criteria established in the Offender Complaint and Grievance Procedures Manual, it will be brought immediately to the attention of the Institutional Head.
  • High priority includes matters that have a direct effect on life, liberty or security of the person or that relate to a griever's access to the complaint and grievance process.

Recommendation CSC Response Key Actions/Commitments

Recommendation 14: (Supported)

The Office of the Correctional Investigator recommended, once again, that CSC immediately commission an external review of its operations and policies in the area of inmate grievances to ensure fair and expeditious resolution of offenders' complaints and grievances at all levels of the process.

The grievance system has been the subject of a comprehensive internal audit.

CSC will undertake an external review of the offender complaints and grievance process.

  • The internal audit has been completed. The final audit report and initial action plans were presented to the CSC Audit Committee, which is made up of three external members, in May 2009.
  • Actions to address findings of the internal audit, based on the recommendations and approval of the audit committee, are underway. Of the eight recommendations, five will be completed during calendar year 2009. The remaining three will be completed in 2010.
  • This fiscal year, CSC will develop a process for an external review of the Offender Complaint and Grievance process. Development of the process will follow consultations with key stakeholders, including the Correctional Investigator.

Recommendation CSC Response Key Actions/Commitments

Recommendation 15:

The Office of the Correctional Investigator recommended that the Minister of Public Safety, together with the Minister of Health, initiate discussions with their provincial/ territorial counterparts and non-governmental stakeholders regarding how to best engage the Mental Health Commission of Canada on the development of a national strategy for corrections that would ensure a better co-ordination among federal/ provincial/ territorial correctional and mental health systems. The development of the national strategy should focus on information sharing between jurisdictions and promote a seamless delivery of mental health services to offenders.

CSC will contribute, where appropriate, and support discussions and consultations aimed at improving models of co-ordination consistent with the direction established by the Mental Health Commission of Canada.

  • In support of the recommendation, CSC has taken steps to develop a cross-jurisdictional approach to mental health services that includes identifying gaps in the continuum of care, building stronger partnerships with stakeholders outside of the federal correctional system, and developing innovative solutions. In May 2008, CSC hosted a Symposium on Mental Health that brought together international and Canadian experts to examine practical solutions to improving delivery of health services. More recently, on June 2009, CSC held a forum that explored the nexus between Canada 's mental health and criminal justice systems. Participants, who included the chair of the Mental Health Commission of Canada and experts in the fields of mental health and criminal justice, examined the system-wide challenges of addressing mental health issues within the criminal justice system and the mental health field. CSC will continue work that fosters information sharing between jurisdictions and the development of a national mental health strategy for corrections.

Recommendation CSC Response Key Actions/Commitments

Recommendation 16:
(Supported)

The Office of the Correctional Investigator recommended that the CSC undertake a broad consultation with federal/ provincial/ territorial and non-governmental partners to review the provision of health care to federal offenders and to propose alternative models for the provision of these services. The development of alternative models should include public consultations.

CSC is a member of the Federal/ Provincial/ Territorial Heads of Corrections Working Group on Health. The group works collaboratively to promote policy and program development that is informed and sensitive to the complex issues surrounding health. The group also encourages and develops effective strategies to address health care issues in the correctional environment collaboratively between governments and community stakeholders and advises Heads of Corrections accordingly.

CSC also chairs the Federal/ Provincial/ Territorial Heads of Corrections Working Group on Mental Health, which includes membership from the Mental Health Commission of Canada. The group, which first met in February 2009, will share best practices for assessment, treatment, training and discharge planning. The group will meet again in September 2009.

CSC also works closely with other partners, including provincial coroners' offices, to discuss opportunities to prevent future deaths in custody. For example, in March 2009, CSC held a meeting with the Coroners and Medical Examiners from across Canada to discuss information sharing and to reinforce our commitment to co-operation.

  • In 2010, CSC will review the status of efforts with federal/ provincial/ territorial and non-governmental partners to address these complex issues and will then develop a framework to assess alternative models for the provision of health care services to federal offenders.

Wednesday, September 23, 2009

Correctional Service of Canada & Ashley Smith.

Correctional Service of Canada's Response to Ashley Smith Report Fails to Accept Urgent Need for Enhanced Accountability Measures to Prevent Future Deaths in Custody

OTTAWA, September 11, 2009 - Despite a long list of actions by the Correctional Service of Canada (CSC) in its Response to recent deaths in custody, the agency's focus on process rather than progress makes the continued likelihood of preventable deaths in custody unacceptably high, says the Correctional Investigator, Howard Sapers.

The federal ombudsman's Preliminary Assessment of CSC's Response to his 2007 Deaths in Custody Study and A Preventable Death: Report into the Death of Ashley Smith, as well as its own National Board of Investigation into Smith's death, found recommendations at the very core of accountability and governance within federal corrections continue to be rejected by the Service.

Specific problems in the CSC Response include: a continuing refusal to provide direct oversight and responsibility for federal women's corrections at the national level; a continuing failure to provide external monitoring of segregation of mentally ill offenders; and a continuing dismissal of the need to ensure independent representation of a mental health professional on national boards of investigation involving offender suicides and incidents of serious or chronic self-injury.

The Correctional Investigator notes that security practices continue to trump clinical needs in the care and custody of offenders with mental health problems. Treatment is at times withdrawn or withheld as a result of "behavioural" issues that are typically met with a security response, such as segregation or use of force interventions. For example, despite her well documented mental health problems, Ashley Smith was immediately placed on segregation status and maintained there for her entire 11 ½ months in Correction Canada's custody, depriving her of the most basic human interaction. The Service cites the construction of secure interview rooms in the women's facilities as a positive development in its Response despite the fact that these facilities prohibit human contact of the kind that mentally ill offenders so often desperately seek.

The Correctional Investigator's Initial Assessment is also critical of CSC's failure to adequately integrate, implement and communicate corrective actions across different sectors of activity and intervention, namely security, health care, case management, programs, and psychological treatment. This ongoing "silo" approach too often results in conflicting priorities, poor care and treatment of inmates with serious mental health problems, inadequate access to rehabilitation programs and ultimately compromises chances for the successful reintegration of offenders to society.

In releasing his Initial Assessment, Sapers noted, "Canadians have a contract with CSC. As the Service's own Mission states 'respecting the rule of law, (it) contributes to public safety by actively encouraging and assisting offenders to become law-abiding citizens, while exercising reasonable, safe, secure and humane control'. In return for this responsibility, the Service agrees to respect the laws under which it is expected to operate. The CSC must be prepared to subject its actions to external scrutiny and to be held accountable at the highest levels of management."

"The ball's now back in CSC's court," said Sapers. "Before I issue my next report this December, I'm asking the Service to provide a fuller and more integrated response that addresses urgent accountability and governance deficiencies."

In his report on the death of Ashley Smith, the Correctional Investigator found many of the actions and decisions taken by the CSC – at the individual, institutional, regional and national levels – were non-compliant with the law and the Service's own policies. The violations included inappropriate use of institutional transfers, administrative segregation, and interventions involving force. As well, Smith did not receive adequate mental health services and staff failed to respond appropriately to her behaviour that often culminated in medical emergencies.

In 2008, the Office of the Correctional Investigator (OCI) released A Failure to Respond, a report on the death of another federal inmate. In 2007, the OCI released its Deaths in Custody Study, which examined 82 deaths of prisoners while in custody of the Correctional Service from 2001-05.

The Deaths in Custody Study concluded that, as in the case of Ashley Smith, some of these deaths could likely have been averted through improved risk assessments, more vigorous preventive measures, and more competent and timely responses by institutional staff.

The Correctional Investigator is mandated by an Act of Parliament to be an independent ombudsman for federal offenders. This work includes ensuring that systemic areas of concern are identified and addressed. OCI reports cited in this release are available at www.oci-bec.gc.ca. CSC's Response can be accessed at http://www.csc-scc.gc.ca/text/pblct/rocidcs/grid2-eng.shtml.

-30-

For more information contact:

Nathalie Neault, Director of Investigations
(613) 998-6960; Nathalie.Neault@oci-bec.gc.ca

Monday, September 21, 2009

SUPREME COURT OF CANADA Citation:Bell Canada v. Bell Aliant Regional Communications, 2009 SCC 40 .

Date:September 18, 2009
Docket: 32611, 32607
Other formats: PDF WPD

Printer Friendly

SUPREME COURT OF CANADA

Citation: Bell Canada v. Bell Aliant Regional Communications, 2009 SCC 40

Date: 20090918

Docket: 32607, 32611

Between:

Bell Canada

Appellant

v.

Bell Aliant Regional Communications, Limited Partnership, Consumers’

Association of Canada, National Anti‑Poverty Organization, Public Interest

Advocacy Centre, MTS Allstream Inc., Société en commandite Télébec and

TELUS Communications Inc.

Respondents

‑ and ‑

Canadian Radio‑television and Telecommunications Commission

Intervener

and between:

TELUS Communications Inc.

Appellant

v.

Bell Canada, Arch Disability Law Centre, Bell Aliant Regional Communications,

Limited Partnership, Canadian Radio‑television and Telecommunications

Commission, Consumers’ Association of Canada, National Anti‑Poverty Organization,

Public Interest Advocacy Centre, MTS Allstream Inc., Saskatchewan

Telecommunications and Société en commandite Télébec

Respondents

and between:

Consumers’ Association of Canada and National Anti‑Poverty Organization

Appellants

v.

Canadian Radio‑television and Telecommunications Commission,

Bell Aliant Regional Communications, Limited Partnership, Bell Canada,

Arch Disability Law Centre, MTS Allstream Inc., TELUS Communications Inc.

and TELUS Communications (Québec) Inc.

Respondents

Coram: McLachlin C.J. and Binnie, LeBel, Deschamps, Fish, Abella, Charron, Rothstein and Cromwell JJ.

Reasons for Judgment:

(paras. 1 to 78)

Abella J. (McLachlin C.J. and Binnie, LeBel, Deschamps, Fish, Charron, Rothstein and Cromwell JJ. concurring)


Note: This document is subject to editorial revision before its reproduction in final form in the Canada Supreme Court Reports.

______________________________


bell canada v. bell aliant

Bell Canada Appellant

v.

Bell Aliant Regional Communications, Limited Partnership,

Consumers’ Association of Canada, National Anti‑Poverty

Organization, Public Interest Advocacy Centre, MTS

Allstream Inc., Société en commandite Télébec and TELUS

Communications Inc. Respondents

and

Canadian Radio‑television and Telecommunications

Commission Intervener

‑ and ‑

TELUS Communications Inc. Appellant

v.

Bell Canada, Arch Disability Law Centre, Bell Aliant

Regional Communications, Limited Partnership, Canadian

Radio‑television and Telecommunications Commission,

Consumers’ Association of Canada, National Anti‑Poverty


Organization, Public Interest Advocacy Centre, MTS

Allstream Inc., Saskatchewan Telecommunications and

Société en commandite Télébec Respondents

‑ and ‑

Consumers’ Association of Canada and National Anti‑Poverty

Organization Appellants

v.

Canadian Radio‑television and Telecommunications

Commission, Bell Aliant Regional Communications, Limited

Partnership, Bell Canada, Arch Disability Law Centre,

MTS Allstream Inc., TELUS Communications Inc. and TELUS

Communications (Québec) Inc. Respondents

Indexed as: Bell Canada v. Bell Aliant Regional Communications

Neutral citation: 2009 SCC 40.

File Nos.: 32607, 32611.

2009: March 26; 2009: September 18.

Present: McLachlin C.J. and Binnie, LeBel, Deschamps, Fish, Abella, Charron, Rothstein and Cromwell JJ.


on appeal from the federal court of appeal

Communications law — Telephone — Regulation of rates charged by telecommunications carriers — Canadian Radio‑television and Telecommunications Commission ordering carriers to create deferral accounts — Accounts being collected from urban residential telephone service revenues to enhance competition — CRTC directing that accounts be disposed of to increase accessibility of telecommunications services for persons with disabilities and to expand broadband coverage — Remaining amounts, if any, being distributed to subscribers — Whether Telecommunications Act authorizes CRTC to direct disposition of deferral account funds as it did — Telecommunications Act, S.C. 1993, c. 38, ss. 7, 47.

Administrative law — Appeals — Standard of review — Canadian Radio‑television and Telecommunications Commission — Standard of review applicable to CRTC’s decision to direct disposition of deferral accounts — Telecommunications Act, S.C. 1993, c. 38, ss. 7, 47, 52(1).


In May 2002, the Canadian Radio‑television and Telecommunications Commission (“CRTC”), in the exercise of its rate-setting authority, established a formula to regulate the maximum prices to be charged for certain services offered by incumbent local exchange carriers, including for residential telephone services in mainly urban non-high cost serving areas (the “Price Caps Decision”). Under the formula established by the Price Caps Decision, any increase in the price charged for these services in a given year was limited to an inflationary cap, less a productivity offset to reflect the low degree of competition in that particular market. The CRTC ordered the carriers to establish deferral accounts as separate accounting entries in their ledgers to record funds representing the difference between the rates actually charged and those as otherwise determined by the formula. At the time, the CRTC did not direct how the deferral account funds were to be used.

In December 2003, Bell Canada sought approval from the CRTC to use the balance in its deferral account to expand high-speed broadband internet services in remote and rural communities. The CRTC invited submissions and conducted a public process to determine the appropriate disposition of the deferral accounts. In February 2006, it decided that each deferral account should be used to improve accessibility for individuals with disabilities and for broadband expansion. Any unexpended funds were to be distributed to certain current residential subscribers through a one-time credit or via prospective rate reductions. This was known as the “Deferral Accounts Decision”.

Bell Canada appealed the order of one-time credits, while the Consumers’ Association of Canada and the National Anti‑Poverty Organization appealed the direction that the funds be used for broadband expansion. The Federal Court of Appeal dismissed the appeals, finding that the Price Caps Decision regime always contemplated that the disposition of the deferral accounts would be subject to the CRTC’s directions and that the CRTC was at all times acting within its mandate. TELUS Communications Inc. joined Bell Canada as an appellant in this Court.

Held: The appeals should be dismissed.


The CRTC’s creation and use of the deferral accounts for broadband expansion and consumer credits was authorized by the provisions of the Telecommunications Act which lays out the basic legislative framework of the Canadian telecommunications industry. In particular, s. 7 of the Act sets out certain broad telecommunications policy objectives and s. 47(a) directs the CRTC to implement them when exercising its statutory authority, balancing the interests of consumers, carriers and competitors. A central responsibility of the CRTC is to determine and approve just and reasonable rates to be charged for telecommunications services. Pursuing policy objectives through the exercise of its rate-setting power is precisely what s. 47 requires the CRTC to do in setting just and reasonable rates. [1] [28] [36]

The issues raised in these appeals go to the very heart of the CRTC’s specialized expertise. The core of the quarrel in effect is with the methodology for setting rates and the allocation of certain proceeds derived from those rates, a polycentric exercise with which the CRTC is statutorily charged and which it is uniquely qualified to undertake. The standard of review is therefore reasonableness. [38]


In ordering subscriber credits and approving the use of funds for broadband expansion, the CRTC acted reasonably and in accordance with the policy objectives of the Telecommunications Act. In the Price Caps Decision, the CRTC indicated that the amounts in the deferral accounts would help achieve the CRTC’s objectives. When the CRTC approved the rates derived from the Price Caps Decision, the portion of the revenues that went into the deferral accounts remained subject to the CRTC’s further directions. The deferral accounts, and the fact that they were encumbered by the possibility of the CRTC’s future directions, were therefore an integral part of the rate-setting exercise. The allocation of deferral account funds to consumers was neither a variation of a final rate nor, strictly speaking, a rebate. From the Price Caps Decision onwards, it was understood that the disposition of the deferral account funds might include an eventual credit to subscribers once the CRTC determined the appropriate allocation. [64‑65] [77]

There was no inappropriate cross-subsidization between residential telephone services and broadband expansion. The Telecommunications Act contemplates a comprehensive national telecommunications framework. The policy objectives that the CRTC is always obliged to consider demonstrate that it need not limit itself to considering solely the service at issue in determining whether rates are just and reasonable. It properly treated the statutory objectives as guiding principles in the exercise of its rate‑setting authority, and came to a reasonable conclusion. [73] [75] [77]

Cases Cited


Referred to: Telecom Decision CRTC 2002‑34; Telecom Decision CRTC 2005‑69; Telecom Decision CRTC 2003‑15; Telecom Decision CRTC 2003‑18; Telecom Public Notice CRTC 2004‑1; Telecom Decision CRTC 2006-9; Telecom Decision CRTC 2008‑1; Council of Canadians with Disabilities v. VIA Rail Canada Inc., 2007 SCC 15, [2007] 1 S.C.R. 650; Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190; Canada (Citizenship and Immigration) v. Khosa, 2009 SCC 12, [2009] 2 S.C.R. 339; Northwestern Utilities Ltd. v. City of Edmonton, [1929] S.C.R. 186; ATCO Gas and Pipelines Ltd. v. Alberta (Energy and Utilities Board), 2006 SCC 4, [2006] 1 S.C.R. 140; Re General Increase in Freight Rates (1954), 76 C.R.T.C. 12; Canadian National Railways Co. v. Bell Telephone Co. of Canada, [1939] 1 S.C.R. 308; Telecom Decision CRTC 97‑9; Telecom Decision CRTC 94‑19; Edmonton (City) v. 360Networks Canada Ltd., 2007 FCA 106, [2007] 4 F.C.R. 747, leave to appeal refused, [2007] 3 S.C.R. vii; Barrie Public Utilities v. Canadian Cable Television Assn., 2003 SCC 28, [2003] 1 S.C.R. 476; Telecom Decision CRTC 93‑9; Bell Canada v. Canada (Canadian Radio‑television and Telecommunications Commission), [1989] 1 S.C.R. 1722; EPCOR Generation Inc. v. Energy and Utilities Board, 2003 ABCA 374, 346 A.R. 281; Reference Re Section 101 of the Public Utilities Act (1998), 164 Nfld. & P.E.I.R. 60.

Statutes and Regulations Cited

Railway Act, R.S.C. 1985, c. R-3, s. 340(1).

Telecommunications Act, S.C. 1993, c. 38, ss. 7, 24, 25(1), 27, 32(g), 35(1), 37(1), 42(1), 46.5(1), 47, 52(1).

Authors Cited

Ryan, Michael H. Canadian Telecommunications Law and Regulation, loose-leaf ed. Scarborough: Carswell, 1993 (updated 2008).

APPEALS from a judgment of the Federal Court of Appeal (Richard C.J. and Noël and Sharlow JJ.A.), 2008 FCA 91, 375 N.R. 124, 80 Admin. L.R. (4th) 159, [2008] F.C.J. No. 397 (QL), 2008 CarswellNat 544, affirming a decision of the Canadian Radio‑television and Telecommunications Commission, 2006 LNCRTCE 9 (QL), 2006 CarswellNat 6317. Appeals dismissed.


Neil Finkelstein, Catherine Beagan Flood and Rahat Godil, for the appellant/respondent Bell Canada.

Michael H. Ryan, John E. Lowe, Stephen R. Schmidt and Sonya A. Morgan, for the appellant/respondent TELUS Communications Inc. and the respondent TELUS Communications (Québec) Inc.

Richard P. Stephenson, Danny Kastner and Michael Janigan, for the appellants/respondents the Consumers’ Association of Canada and the National Anti‑Poverty Organization and the respondent the Public Interest Advocacy Centre.

Michael Koch and Dina F. Graser, for the respondent MTS Allstream Inc.

John B. Laskin and Afshan Ali, for the respondent/intervener the Canadian Radio‑television and Telecommunications Commission.

No one appeared for the respondents Société en commandite Télébec, Arch Disability Law Centre, Bell Aliant Regional Communications, Limited Partnership, and Saskatchewan Telecommunications.

The judgment of the Court was delivered by

Abella J.


[1] The Telecommunications Act, S.C. 1993, c. 38, sets out certain broad telecommunications policy objectives. It directs the Canadian Radio-television and Telecommunications Commission (“CRTC”) to implement them in the exercise of its statutory authority, balancing the interests of consumers, carriers and competitors in the context of the Canadian telecommunications industry. The issue in these appeals is whether this authority was properly exercised.

[2] While distinct questions arise in each of the appeals before us, the common problem is whether the CRTC, in the exercise of its rate-setting authority, appropriately directed the allocation of funds to various purposes. In the Bell Canada and TELUS Communications Inc. appeal, the challenged purpose is the distribution of funds to customers, while in the Consumers’ Association of Canada and National Anti-Poverty Organization appeal, the impugned allocation was directed at the expansion of broadband infrastructure. For the reasons that follow, in my view the CRTC’s allocations were reasonable based on the Canadian telecommunications policy objectives that it is obliged to consider in the exercise of all of its powers, including its authority to approve just and reasonable rates.

Background


[3] The CRTC issued its landmark “Price Caps Decision”[1] in May 2002. Exercising its rate-setting authority, the CRTC established a formula to regulate the maximum prices charged for certain services offered by incumbent local exchange carriers (“ILECs”), who are primarily well-established telecommunications carriers.

[4] As part of its decision, the CRTC ordered the affected carriers to create separate accounting entries in their ledgers. These were called “deferral accounts”. The funds contained in these deferral accounts were derived from residential telephone service revenues in non‑high cost serving areas (“non‑HCSAs”), which are mainly urban. Under the formula established by the Price Caps Decision, any increase in the price charged for these services in a given year was limited to an inflationary cap, less a productivity offset to reflect the low degree of competition in that particular market.

[5] More specifically, the effect of the inflationary cap was to bar carriers from increasing their prices at a rate greater than inflation. The productivity offset, on the other hand, put downward pressure on the rates to be charged. While market forces would normally serve to encourage carriers to reduce both their costs and their prices, the low level of competition in the non-HCSA market led the CRTC to conclude that an offsetting factor was necessary as a proxy for the effect of competition.


[6] Given the countervailing factors at work in the Price Caps Decision formula, there was the potential for a decrease in the price of residential services in these areas if inflation fell below a certain level. Rather than mandating such a decrease, however, the CRTC concluded that lower prices, and therefore the prospect of lower revenues, would constitute a barrier to the entry of new carriers into this particular telecommunications market. It therefore ordered that amounts representing the difference between the rates actually charged, not including the decrease mandated by the Price Caps Decision formula, and the rates as otherwise determined through the formula, were to be collected from subscribers and recorded in deferral accounts held by each carrier. These accounts were to be reviewed annually by the CRTC. The intent of the Price Caps Decision was, therefore, that prices for these services would remain at a level sufficient to encourage market entry, while at the same time maintaining the pressure on the incumbent carriers to reduce their costs.

[7] The principal objectives the CRTC intended the Price Caps Decision to achieve were the following:

a) to render reliable and affordable services of high quality, accessible to both urban and rural area customers;

b) to balance the interests of the three main stakeholders in telecommunications markets, i.e., customers, competitors and incumbent telephone companies;

c) to foster facilities‑based competition in Canadian telecommunications markets;

d) to provide incumbents with incentives to increase efficiencies and to be more innovative; and

e) to adopt regulatory approaches that impose the minimum regulatory burden compatible with the achievement of the previous four objectives. [para. 99]

[8] The CRTC discussed the future use of the deferral account funds as follows:

The Commission anticipates that an adjustment to the deferral account would be made whenever the Commission approves rate reductions for residential local services that are proposed by the ILECs as a result of competitive pressures. The Commission also anticipates that the deferral account would be drawn down to mitigate rate increases for residential service that could result from the approval of exogenous factors or when inflation exceeds productivity. Other draw downs could occur, for example, through subscriber rebates or the funding of initiatives that would benefit residential customers in other ways. [Emphasis added; para. 412.]


At the time, it did not specifically direct how the deferral account funds were to be used, leaving the issue subject to further submissions. While some participants objected to the creation of the deferral accounts, no one appealed the Price Caps Decision (Bell Canada v. Canadian Radio-television and Telecommunications Commission, 2008 FCA 91, 375 N.R. 124, at para. 14).

[9] The Price Caps Decision was to apply to services offered by Bell Canada, TELUS, and other affected carriers for the four-year period from June 1, 2002 to May 31, 2006. In a decision in 2005, the CRTC extended this price regulation regime for another year to May 31, 2007[2]. The CRTC allowed some draw-downs of the deferral accounts following the Price Caps Decision that are not at issue in these appeals.

[10] In March 2003, in two separate decisions, the CRTC approved the rates for Bell Canada and TELUS[3]. In the Bell Canada decision, the CRTC appeared to contemplate the continued operation of the deferral accounts established in the Price Caps Decision. It ordered, for example, that certain tax savings be allocated to the deferral accounts:

The Commission, in Decision 2002‑34, established a deferral account in conjunction with the application of a basket constraint equal to the rate of inflation less a productivity offset to all revenues from residential services in non‑HCSAs. The Commission considers that AT&T Canada’s proposal to allocate the Ontario GRT and the Quebec TGE tax savings associated with all capped services to the price cap deferral account is inconsistent with that determination. The Commission finds that Bell Canada’s proposal to include the Ontario GRT and Quebec TGE tax savings associated with the residential local services in non‑HCSAs basket in the price cap deferral account is consistent with that determination. [Emphasis added; para. 32.]


[11] On December 2, 2003, Bell Canada sought the approval of the CRTC to use the balance in its deferral account to expand high‑speed broadband internet service to remote and rural communities. In response, on March 24, 2004, the CRTC issued a public notice requesting submissions on the appropriate disposition of the deferral accounts[4]. Pursuant to this notice, the CRTC conducted a public process whereby proposals were invited for the disposition of the affected carriers’ deferral accounts. The review was extensive and proposals were received from numerous parties.

[12] This led to the release of the “Deferral Accounts Decision” on February 16, 2006[5]. In this decision, the CRTC directed how the funds in the deferral accounts were to be used. These directions form the foundation of these appeals.

[13] After considering the various policy objectives outlined in the applicable statute, the Telecommunications Act, and the purposes set out in the Price Caps Decision, the CRTC concluded that all funds in the deferral accounts should be targeted for disposal by a designated date in 2006:

The attachment to this Decision provides preliminary estimates of the deferral account balances as of the end of the fourth year of the current price cap period in 2006. The Commission notes that the deferral account balances are expected to be very large for some ILECs. It also notes the concern that allowing funds to continue to accumulate in the accounts would create inefficiencies and uncertainties.

. . .


Accordingly, the Commission considers it appropriate not only to provide directions on the disposition of all the funds that will have accumulated in the ILECs’ deferral accounts by the end of the fourth year of the price cap period in 2006, but also to provide directions to address amounts recurring beyond this period in order to prevent further accumulation of funds in the deferral accounts. The Commission will provide directions and guidelines for disposing of these amounts later in this Decision. [Emphasis added; paras. 58 and 60.]

[14] The CRTC further decided that the deferral accounts should be disbursed primarily for two purposes. As a priority, at least 5 percent of the accounts was to be used for improving accessibility to telecommunications services for individuals with disabilities. The other 95 percent was to be used for broadband expansion in rural and remote communities. Proposals were invited on how the deferral account funds should be applied. If the proposal as approved was for less than the balance of its deferral account, an affected carrier was to distribute the remaining amount to consumers.

[15] In summary, therefore, the CRTC decided that the affected carriers should focus on broadband expansion and accessibility improvement. It also decided that if these two objectives could be fulfilled for an amount less than the full deferral account balances, credits to subscribers would be ordered out of the remainder. It should be noted that customers were not to be compensated in proportion to what they had paid through these credits because of the potential administrative complexity of identifying these individuals and quantifying their respective shares. Instead, the credits were to be provided to certain current subscribers. Prospective rate reductions could also be used to eliminate recurring amounts in the accounts.


[16] At the time, the balance in the deferral accounts established under the Price Caps Decision was considerable. Bell Canada’s account was estimated to contain approximately $480.5 million, while the TELUS account was estimated at about $170 million.

[17] It is helpful to set out how the CRTC explained its decision on the allocation of the deferral account funds. Referencing the importance of telecommunications in connecting Canada’s “vast geography and relatively dispersed population”, it stressed that Canada had fallen behind in the adoption of broadband services (at paras. 73-74). It contrasted the wide availability of broadband service in urban areas with the less developed network in rural and remote communities. Further, it noted that the objectives outlined in the Price Caps Decision and in the Telecommunications Act at s. 7(b) provided for improving the quality of telecommunications services in those communities, and that their social and economic development would be favoured by an expansion of the national broadband network. In its view, this initiative would also provide a helpful complement to the efforts of both levels of government to expand broadband coverage. It therefore concluded that broadband expansion was an appropriate use of a part of the deferral account funds (at paras. 73-80).

[18] The CRTC also explained that while customer credits would be consistent with the objectives set out in s. 7 of the Telecommunications Act and with the Price Caps Decision, these disbursements should not be given priority because broadband expansion and accessibility services provided greater long-term benefits. Nevertheless, credits effectively balanced the interests of the “three main stakeholders in the telecommunications markets” (at para. 115), namely customers, competitors and carriers. It concluded that credits did not contradict the purpose of the deferral accounts, and contrasted one‑time credits with a reduction of rates. In its view, credits, unlike rate reductions, did not have a sustained negative impact on competition in these markets, which was the concern the deferral accounts were set up to address (at paras. 112-16).


[19] A dissenting Commissioner expressed concerns over the disposition of the deferral account funds. In her view, the CRTC had no mandate to direct the expansion of broadband networks across the country. The CRTC’s policy had generally been to ensure the provision of a basic level of service, not services like broadband, and she therefore considered the CRTC’s reliance on the objectives of the Telecommunications Act to be inappropriate.

[20] On January 17, 2008, the CRTC issued another decision dealing with the carriers’ proposals to use their deferral account balances for the purposes set out in the Deferral Accounts Decision[6]. Some carriers’ plans were approved in part, with the result that only a portion of their deferral account balances was allocated to those projects. Consequently, the CRTC required them to submit, by March 25, 2008, a plan for crediting the balance in their deferral accounts to residential subscribers in non-HCSAs.

[21] Bell Canada, as well as the Consumers’ Association of Canada and the National Anti-Poverty Organization, appealed the CRTC’s Deferral Accounts Decision to the Federal Court of Appeal. The Deferral Accounts Decision was stayed by Richard C.J. in the Federal Court of Appeal on January 25, 2008. The decision requiring further submissions on plans to distribute the deferral account balances was also stayed by Sharlow J.A. pending the filing of an application for leave to appeal to this Court on April 23, 2008. Both stay orders were extended by this Court on September 25, 2008. The stay orders do not apply to the funds allocated for the improvement of accessibility for individuals with disabilities.


[22] In a careful judgment by Sharlow J.A., the court unanimously dismissed the appeals, concluding that the Price Caps Decision regime always contemplated the future disposition of the deferral account funds as the CRTC would direct, and that the CRTC acted within its broad mandate to pursue its regulatory objectives. For the reasons that follow, I agree with the conclusions reached by Sharlow J.A.

Analysis

[23] The parties have staked out diametrically opposite positions on how the balance of the deferral account funds should be allocated.

[24] Bell Canada argued that the CRTC had no statutory authority to order what it claimed amounted to retrospective “rebates” to consumers. In its view, the distributions ordered by the CRTC were in substance a variation of rates that had been declared final. TELUS joined Bell Canada in this Court, and argued that the CRTC’s order for “rebates” constituted an unjust confiscation of property.

[25] In response, the CRTC contended that its broad mandate to set rates under the Telecommunications Act includes establishing and ordering the disposal of funds from deferral accounts. Because the deferral account funds had always been subject to the possibility of disbursement to customers, there was therefore no variation of a final rate or any impermissible confiscation.


[26] The Consumers’ Association of Canada was the only party to oppose the allocation of 5 percent of the deferral account balances to improving accessibility, but abandoned this argument during the hearing before the Federal Court of Appeal. Together with the National Anti-Poverty Organization, it argued before this Court that the rest of the deferral account balances should be distributed to customers in full, and that the CRTC had no authority to allow the use of the funds for broadband expansion.

[27] These arguments bring us directly to the statutory scheme at issue.

[28] The Telecommunications Act lays out the basic legislative framework of the Canadian telecommunications industry. In addition to setting out numerous specific powers, the statute’s guiding objectives are set out in s. 7. Pursuant to s. 47(a), the CRTC must consider these objectives in the exercise of all of its powers. These provisions state:

7. It is hereby affirmed that telecommunications performs an essential role in the maintenance of Canada’s identity and sovereignty and that the Canadian telecommunications policy has as its objectives

(a) to facilitate the orderly development throughout Canada of a telecommunications system that serves to safeguard, enrich and strengthen the social and economic fabric of Canada and its regions;

(b) to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;

(c) to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;

(d) to promote the ownership and control of Canadian carriers by Canadians;


(e) to promote the use of Canadian transmission facilities for telecommunications within Canada and between Canada and points outside Canada;

(f) to foster increased reliance on market forces for the provision of telecommunications services and to ensure that regulation, where required, is efficient and effective;

(g) to stimulate research and development in Canada in the field of telecommunications and to encourage innovation in the provision of telecommunications services;

(h) to respond to the economic and social requirements of users of telecommunications services; and

(i) to contribute to the protection of the privacy of persons.

. . .

47. The Commission shall exercise its powers and perform its duties under this Act and any special Act

(a) with a view to implementing the Canadian telecommunications policy objectives and ensuring that Canadian carriers provide telecommunications services and charge rates in accordance with section 27;

The CRTC relied on these two provisions in arguing that it was required to take into account a broad spectrum of considerations in the exercise of its rate‑setting powers, and that the Deferral Accounts Decision was simply an extension of this approach.

[29] The Telecommunications Act grants the CRTC the general power to set and regulate rates for telecommunications services in Canada. All tariffs imposed by carriers, including rates for services, must be submitted to it for approval, and it may decide any matter with respect to rates in the telecommunications services industry, as the following provisions show:


24. The offering and provision of any telecommunications service by a Canadian carrier are subject to any conditions imposed by the Commission or included in a tariff approved by the Commission.

25. (1) No Canadian carrier shall provide a telecommunications service except in accordance with a tariff filed with and approved by the Commission that specifies the rate or the maximum or minimum rate, or both, to be charged for the service.

. . .

32. The Commission may, for the purposes of this Part,

. . .

(g) in the absence of any applicable provision in this Part, determine any matter and make any order relating to the rates, tariffs or telecommunications services of Canadian carriers.

[30] The guiding rule of rate-setting under the Telecommunications Act is that the rates be “just and reasonable”, a longstanding regulatory principle. To determine whether rates meet this standard, the CRTC has a wide discretion which is protected by a privative clause:

27. (1) Every rate charged by a Canadian carrier for a telecommunications service shall be just and reasonable.

. . .

(3) The Commission may determine in any case, as a question of fact, whether a Canadian carrier has complied with section 25, this section or section 29, or with any decision made under section 24, 25, 29, 34 or 40.

. . .

(5) In determining whether a rate is just and reasonable, the Commission may adopt any method or technique that it considers appropriate, whether based on a carrier’s return on its rate base or otherwise.

. . .

52. (1) The Commission may, in exercising its powers and performing its duties under this Act or any special Act, determine any question of law or of fact, and its determination on a question of fact is binding and conclusive.


[31] In addition to the power under s. 27(5) to adopt “any method or technique that it considers appropriate” for determining whether a rate is just and reasonable, the CRTC also has the authority under s. 37(1) to order a carrier to adopt “any accounting method or system of accounts” in view of the proper administration of the Telecommunications Act. Section 37(1) states:

37. (1) The Commission may require a Canadian carrier

(a) to adopt any method of identifying the costs of providing telecommunications services and to adopt any accounting method or system of accounts for the purposes of the administration of this Act;

[32] The CRTC has other broad powers which, while not at issue in this case, nevertheless further demonstrate the comprehensive regulatory powers Parliament intended to grant. These include the ability to order a Canadian carrier to provide any service in certain circumstances (s. 35(1)); to require communications facilities to be provided or constructed (s. 42(1)); and to establish any sort of fund for the purpose of supporting access to basic telecommunications services (s. 46.5(1)).

[33] This statutory overview assists in dealing with the preliminary issue of the applicable standard of review. Although the Federal Court of Appeal accepted the parties’ position that the applicable standard of review was correctness, Sharlow J.A. acknowledged that the standard of review could be more deferential in light of this Court’s decision in Council of Canadians with Disabilities v. VIA Rail Canada Inc., 2007 SCC 15, [2007] 1 S.C.R. 650, at paras. 98-100. This was an invitation, it seems to me, to clarify what the appropriate standard is.


[34] Bell Canada and TELUS concede that the CRTC had the authority to approve disbursements from the deferral accounts for initiatives to improve broadband expansion and accessibility to telecommunications services for persons with disabilities, and that they actually sought such approval. In their view, however, this authority did not extend to what they characterized as retrospective “rebates”. Similarly, in the Consumers’ appeal the crux of the complaint is with whether the CRTC could direct that the funds be disbursed in certain ways, not with whether it had the authority to direct how the funds ought to be spent generally.

[35] This means that for Bell Canada and TELUS appeal, the dispute is over the CRTC’s authority and discretion under the Telecommunications Act in connection with ordering credits to customers from the deferral accounts. In the Consumers’ appeal, it is over its authority and discretion in ordering that funds from the deferral accounts be used for the expansion of broadband services.

[36] A central responsibility of the CRTC is to determine and approve just and reasonable rates to be charged for telecommunications services. Together with its rate-setting power, the CRTC has the ability to impose any condition on the provision of a service, adopt any method to determine whether a rate is just and reasonable and require a carrier to adopt any accounting method. It is obliged to exercise all of its powers and duties with a view to implementing the Canadian telecommunications policy objectives set out in s. 7.


[37] The CRTC’s authority to establish the deferral accounts is found through a combined reading of ss. 27 and 37(1). The authority to establish these accounts necessarily includes the disposition of the funds they contain, a disposition which represents the final step in a process set in motion by the Price Caps Decision. It is self-evident that the CRTC has considerable expertise with respect to this type of question. This observation is reflected in its extensive statutory powers in this regard and in the strong privative clause in s. 52(1) protecting its determinations on questions of fact from appeal, including whether a carrier has adopted a just and reasonable rate.

[38] In my view, therefore, the issues raised in these appeals go to the very heart of the CRTC’s specialized expertise. In the appeals before us, the core of the quarrel in effect is with the methodology for setting rates and the allocation of certain proceeds derived from those rates, a polycentric exercise with which the CRTC is statutorily charged and which it is uniquely qualified to undertake. This argues for a more deferential standard of review, which leads us to consider whether the CRTC was reasonable in directing how the funds from the deferral accounts were to be used. (See Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at para. 54; Canada (Citizenship and Immigration) v. Khosa, 2009 SCC 12, [2009] 1 S.C.R. 339, at para. 25; and VIA Rail Canada Inc., at paras. 88-100.)

[39] This brings us to the nature of the CRTC’s rate-setting power in the context of this case. The predecessor statute for telecommunications rate-setting, the Railway Act, R.S.C. 1985, c. R-3, also stipulated that rates be “just and reasonable” (s. 340(1)). Traditionally, those rates were based on a balancing between a fair rate for the consumer and a fair return on the carrier’s investment. (See, e.g., Northwestern Utilities Ltd. v. City of Edmonton, [1929] S.C.R. 186, at pp. 192-93 and ATCO Gas and Pipelines Ltd. v. Alberta (Energy and Utilities Board), 2006 SCC 4, [2006] 1 S.C.R. 140, at para. 65.)


[40] Even before the expansive language now found in the Telecommunications Act, regulatory agencies had enjoyed considerable discretion in determining the factors to be considered and the methodology that could be adopted for assessing whether rates were just and reasonable. For instance, in dismissing a leave application in Re General Increase in Freight Rates (1954), 76 C.R.T.C. 12 (S.C.C.), Taschereau J. wrote:

[I]f the Board is bound to grant a relief which is just to the public and secures to the railways a fair return, it is not bound to accept for the determination of the rates to be charged, the sole method proposed by the applicant. The obligation to act is a question of law, but the choice of the method to be adopted is a question of discretion with which, under the statute, no Court of law may interfere. [Emphasis added; p. 13.]

In making this determination, he relied on Duff C.J.’s judgment in Canadian National Railways Co. v. Bell Telephone Co. of Canada, [1939] S.C.R. 308, for the following proposition in the particular statutory context of that case:

The law dictates neither the order to be made in a given case nor the considerations by which the Board is to be guided in arriving at the conclusion that an order, or what order, is necessary or proper in a given case. True, it is the duty of all public bodies and others invested with statutory powers to act reasonably in the execution of them, but the policy of the statue [sic] is that, subject to the appeal to the Governor in Council under s. 52, in exercising an administrative discretion entrusted to it, the Board itself is to be the final arbiter as to the order to be made. [p. 315]

(See also Michael H. Ryan, Canadian Telecommunications Law and Regulation (loose-leaf ed.), at §612.)

[41] The CRTC’s already broad discretion in determining whether rates are just and reasonable has been further enhanced by the inclusion of s. 27(5) in the Telecommunications Act permitting the CRTC to adopt “any method”, language which was absent from the Railway Act.


[42] Even more significantly, the Railway Act contained nothing analogous to the statutory direction under s. 47 that the CRTC must exercise its rate-setting powers with a view to implementing the Canadian telecommunications objectives set out in s. 7. These statutory additions are significant. Coupled with its rate-setting power, and its ability to use any method for arriving at a just and reasonable rate, these provisions contradict the restrictive interpretation of the CRTC’s authority proposed by various parties in these appeals.

[43] This was highlighted by Sharlow J.A. when she stated:

Because of the combined operation of section 47 and section 7 of the Telecommunications Act . . ., the CRTC’s rating jurisdiction is not limited to considerations that have traditionally been considered relevant to ensuring a fair price for consumers and a fair rate of return to the provider of telecommunication services. Section 47 of the Telecommunications Act expressly requires the CRTC to consider, as well, the policy objectives listed in section 7 of the Telecommunications Act. What that means, in my view, is that in rating decisions under the Telecommunications Act, the CRTC is entitled to consider any or all of the policy objectives listed in section 7. [para. 35]

[44] It is true that the CRTC had previously used a “rate base rate of return” method, based on a combination of a rate of return for investors in telecommunications carriers and a rate base calculated using the carriers’ assets. This resulted in rates charged for the carrier’s services that would, on the one hand, provide a fair return for the capital invested in the carrier, and, on the other, be fair to the customers of the carrier.


[45] However, these expansive provisions mean that the rate base rate of return approach is not necessarily the only basis for setting a just and reasonable rate. Furthermore, based on ss. 7, 27(5) and 47, the CRTC is not required to confine itself to balancing only the interests of subscribers and carriers with respect to a particular service. In the Price Caps Decision, for example, the CRTC chose to focus on maximum prices for services, rather than on the rate base rate of return approach. It did so, in part, to foster competition in certain markets, a goal untethered to the direct relationship between the carrier and subscriber in the traditional rate base rate of return approach. A similar pricing approach was adopted by the CRTC in a decision preceding the Price Caps Decision[7].

[46] The CRTC has interpreted these provisions broadly and identified them as responsive to the evolved industry context in which it operates. In its “Review of Regulatory Framework” decision[8], it wrote:

The Act ... provides the tools necessary to allow the Commission to alter the traditional manner in which it regulates (i.e., to depart from rate base rate of return regulation).

. . .

In brief, telecommunications today transcends traditional boundaries and simple definition. It is an industry, a market and a means of doing business that encompasses a constantly evolving range of voice, data and video products and services.

. . .

In this context, the Commission notes that the Act contemplates the evolution of basic service by setting out as an objective the provision of reliable and affordable telecommunications, rather than merely affordable telephone service. [Emphasis added; pp. 6 and 10.]


[47] In Edmonton (City) v. 360Networks Canada Ltd., 2007 FCA 106, [2007] 4 F.C.R. 747, leave to appeal refused, [2007], 3 S.C.R. vii, the Federal Court of Appeal drew similar conclusions, observing that the Telecommunications Act should be interpreted by reference to the policy objectives, and that s. 7 justified in part the view that the “Act should be interpreted as creating a comprehensive regulatory scheme” (at para. 46). A duty to take a more comprehensive approach was also noted by Ryan, who observed:

Because of the importance of the telecommunications industry to the country as a whole, rate‑making issues may sometimes assume a dimension that gives them a significance that extends beyond the immediate interests of the carrier, its shareholders and its customers, and engages the interests of the public at large. It is also part of the duty of the regulator to take these more far‑reaching interests into account. [§604]

[48] This leads inevitably, it seems to me, to the conclusion that the CRTC may set rates that are just and reasonable for the purposes of the Telecommunications Act through a diverse range of methods, taking into account a variety of different constituencies and interests referred to in s. 7, not simply those it had previously considered when it was operating under the more restrictive provisions of the Railway Act. This observation will also be apposite later in these reasons when the question of “final rates” is discussed in connection with the Bell Canada appeal.


[49] I see nothing in this conclusion which contradicts the ratio in Barrie Public Utilities v. Canadian Cable Television Assn., 2003 SCC 28, [2003] 1 S.C.R. 476. In that case, the issue was whether the CRTC could make an order granting cable companies access to certain utilities’ power poles. In that decision, the CRTC had relied on the Canadian telecommunications policy objectives to inform its interpretation of the relevant provisions. In deciding that the language of the Telecommunications Act did not give the CRTC the power to grant access to the power poles, Gonthier J. for the majority concluded that the CRTC had inappropriately interpreted the Canadian telecommunications policy objectives in s. 7 as power‑conferring (at para. 42).

[50] The circumstances of Barrie Public Utilities are entirely distinct from those at issue before us. Here, we are dealing with the CRTC setting rates that were required to be just and reasonable, an authority fully supported by unambiguous statutory language. In so doing, the CRTC was exercising a broad authority, which, according to s. 47, it was required to do “with a view to implementing the Canadian telecommunications policy objectives . . . ”. The policy considerations in s. 7 were factors that the CRTC was required to, and did, take into account.

[51] Nor does this Court’s decision in ATCO preclude the pursuit of public interest objectives through rate-setting. In that case, Bastarache J. for the majority, took a strict approach to the Alberta Energy and Utilities Board’s powers under the applicable statute. The issue was whether the Board had the authority to order the distribution of proceeds by a regulated company to its subscribers from an asset sale it had approved. It was argued that because the Board had the authority to make “further orders” and impose conditions “in the public interest” on any order, it therefore had the ability to order the disposition of the sale proceeds.


[52] In holding that the Board had no such authority, Bastarache J. relied in part on the conclusion that the Board’s statutory power to make orders or impose conditions in the public interest was insufficiently precise to grant the ability to distribute sale proceeds to ratepayers (at para. 46). The ability of the Board to approve an asset sale, and its authority to make any order it wished in the public interest, were necessarily limited by the context of the relevant provisions (at paras. 46-48 and 50). It was obliged too to adopt a rate base rate of return method to determine rates, pursuant to its governing statute (at paras. 65-66).

[53] Unlike ATCO, in the case before us the CRTC’s rate-setting authority, and its ability to establish deferral accounts for this purpose, are at the very core of its competence. The CRTC is statutorily authorized to adopt any method of determining just and reasonable rates. Furthermore, it is required to consider the statutory objectives in the exercise of its authority, in contrast to the permissive, free-floating direction to consider the public interest that existed in ATCO. The Telecommunications Act displaces many of the traditional restrictions on rate-setting described in ATCO, thereby granting the CRTC the ability to balance the interests of carriers, consumers and competitors in the broader context of the Canadian telecommunications industry (Review of Regulatory Framework Decision, at pp. 6 and 10).


[54] The fact that deferral accounts are at issue does nothing to change this framework. No party objected to the CRTC’s authority to establish the deferral accounts themselves. These accounts are accepted regulatory tools, available as a part of the Commission’s rate-setting powers. As the CRTC has noted, deferral accounts “enabl[e] a regulator to defer consideration of a particular item of expense or revenue that is incapable of being forecast with certainty for the test year”[9]. They have traditionally protected against future eventualities, particularly the difference between forecasted and actual costs and revenues, allowing a regulator to shift costs and expenses from one regulatory period to another. While the CRTC’s creation and use of the deferral accounts for broadband expansion and consumer credits may have been innovative, it was fully supported by the provisions of the Telecommunications Act.

[55] In my view, it follows from the CRTC’s broad discretion to determine just and reasonable rates under s. 27, its power to order a carrier to adopt any accounting method under s. 37, and its statutory mandate under s. 47 to implement the wide-ranging Canadian telecommunications policy objectives set out in s. 7, that the Telecommunications Act provides the CRTC with considerable scope in establishing and approving the use to be made of deferral accounts. They were created in accordance both with the CRTC’s rate-setting authority and with the goal that all rates charged by carriers were and would remain just and reasonable.

[56] A deferral account would not serve its purpose if the CRTC did not also have the power to order the disposition of the funds contained in it. In my view, the CRTC had the authority to order the disposition of the accounts in the exercise of its rate‑setting power, provided that this exercise was reasonable.

[57] I therefore agree with the following observation by Sharlow J.A.:

The Price Caps Decision required Bell Canada to credit a portion of its final rates to a deferral account, which the CRTC had clearly indicated would be disposed of in due course as the CRTC would direct. There is no dispute that the CRTC is entitled to use the device of a mandatory deferral account to impose a contingent obligation on a telecommunication service provider to make expenditures that the CRTC may direct in the future. It necessarily follows that the CRTC is entitled to make an order crystallizing that obligation and directing a particular expenditure, provided the expenditure can reasonably be justified by one or more of the policy objectives listed in section 7 of the Telecommunications Act. [Emphasis added; para. 52.]


[58] This general analytical framework brings us to the more specific questions in these appeals. In the first appeal, Bell Canada relied on Gonthier J.’s decision Bell Canada v. Canada (Canadian Radio‑Television and Telecommunications Commission), [1989] 1 S.C.R. 1722 (“Bell Canada (1989)”), to argue that “final” rates cannot be changed and that the funds in the deferral accounts could not, therefore, be distributed as “rebates” to customers.

[59] In Bell Canada (1989), the CRTC approved a series of interim rates. It subsequently reviewed them in light of Bell Canada’s changed financial situation, and ordered the carrier to credit what it considered to be excess revenues to its current subscribers. Arguing against the CRTC’s authority to do so, Bell Canada contended that the CRTC could not order a one-time credit with respect to revenues earned from rates approved by the CRTC, whether the rate order was an interim one or not. Gonthier J. observed that while the Railway Act contemplated a positive approval scheme that only allowed for prospective, not retroactive or retrospective rate‑setting, the one-time credit at issue was nevertheless permissible because the original rates were interim and therefore inherently subject to change.

[60] In the current case, Bell Canada argued that the rates had been made final, and that the disposition of the deferral accounts for one-time credits was therefore impermissible. More specifically, it argued that the CRTC’s order of one-time credits from the deferral accounts amounted to retrospective rate-setting as the term was used in Bell Canada (1989), at p. 1749, namely, that their “purpose is to remedy the imposition of rates approved in the past and found in the final analysis to be excessive” (at p. 1749).


[61] In my view, because this case concerns encumbered revenues in deferral accounts (referred to by Sharlow J.A. as contingent obligations or liabilities), we are not dealing with the variation of final rates. As Sharlow J.A. pointed out, Bell Canada (1989) is inapplicable because it was known from the outset in the case before us that Bell Canada would be obliged to use the balance of its deferral account in accordance with the CRTC’s subsequent direction (at para. 53).

[62] It would, with respect, be an oversimplification to consider that Bell Canada (1989) applies to bar the provision of credits to consumers in this case. Bell Canada (1989) was decided under the Railway Act, a statutory scheme that, significantly, did not include any of the considerations or mandates set out in ss. 7, 27(5) and 47 of the Telecommunications Act. Nor did it involve the disposition of funds contained in deferral accounts.

[63] In my view, the credits ordered out of the deferral accounts in the case before us are neither retroactive nor retrospective. They do not vary the original rate as approved, which included the deferral accounts, nor do they seek to remedy a deficiency in the rate order through later measures, since these credits or reductions were contemplated as a possible disposition of the deferral account balances from the beginning. These funds can properly be characterized as encumbered revenues, because the rates always remained subject to the deferral accounts mechanism established in the Price Caps Decision. The use of deferral accounts therefore precludes a finding of retroactivity or retrospectivity. Furthermore, using deferral accounts to account for the difference between forecast and actual costs and revenues has traditionally been held not to constitute retroactive rate-setting (EPCOR Generation Inc. v. Energy and Utilities Board, 2003 ABCA 374, 346 A.R. 281, at para. 12, and Reference Re Section 101 of the Public Utilities Act (1998), 164 Nfld. & P.E.I.R. 60 (Nfld. C.A.), at paras. 97-98 and 175).


[64] The Deferral Accounts Decision was the culmination of a process undertaken in the Price Caps Decision. In the Price Caps Decision, the CRTC indicated that the amounts in the deferral accounts were to be used in a manner contributing to achieving the CRTC’s objectives (at paras. 409 and 412). In the Deferral Accounts Decision, the CRTC summarized its earlier findings that draw‑downs could occur for various purposes, including through subscriber credits (at para. 6). When the CRTC approved the rates derived from the Price Caps Decision, the portion of the revenues that went into the deferral accounts remained encumbered. The deferral accounts, and the encumbrance to which the funds recorded in them were subject, were therefore an integral part of the rate-setting exercise ensuring that the rates approved were just and reasonable. It follows that nothing in the Deferral Accounts Decision changed either the Price Caps Decision or any other prior CRTC decision on this point. The CRTC’s later allocation of deferral account balances for various purposes, therefore, including customer credits, was not a variation of a final rate order.

[65] The allocation of deferral account funds to consumers was not, strictly speaking, a “rebate” in any event. Instead, as in Bell Canada (1989), these allocations were one‑time disbursements or rate reductions the carriers were required to make out of the deferral accounts to their current subscribers. The possibility of one-time credits was present from the inception of the rate-setting exercise. From the Price Caps Decision onwards, it was understood that the disposition of the deferral account funds might include an eventual credit to subscribers once the CRTC determined the appropriate allocation. It was precisely because the rate-setting mechanism approved by the CRTC included accumulation in and disposition from the deferral accounts pursuant to further CRTC orders, that the rates were and continued to be just and reasonable.


[66] Therefore, rather than viewing Bell Canada (1989) as setting a strict rule that subscriber credits can never be ordered out of revenues derived from final rates, it is important to remember Gonthier J.’s concern that the financial stability of regulated utilities could be undermined if rates were open to indiscriminate variation (at p. 1760). Nothing in the Deferral Accounts Decision undermined the financial stability of the affected carriers. The amounts at issue were always treated differently for accounting purposes, and the regulated carriers were aware of the fact that the portion of their revenues going into the deferral accounts remained encumbered. In fact, the Price Caps Decision formula would have allowed for lower rates than the ones ultimately set, were it not for the creation of the deferral accounts. Those lower rates could conceivably have been considered sufficient to maintain the financial stability of the carriers and were increased only in an effort to encourage market entry by new competitors.

[67] TELUS argued additionally that the Deferral Accounts Decision constituted a confiscation of its property. This is an argument I have difficulty accepting. The funds in the accounts never belonged unequivocally to the carriers, and always consisted of encumbered revenues. Had the CRTC intended that these revenues be used for any purposes the affected carriers wanted, it could simply have approved the rates as just and reasonable and ordered the balance of the deferral accounts turned over to them. It chose not to do so.


[68] It is also worth noting that in approving Bell Canada’s rates, the CRTC ordered it to allocate certain tax savings to the deferral accounts[10]. Neither the CRTC, nor Bell Canada, could possibly have expected that the company would be able to keep that portion of its rate revenue representing a past liability for taxes that it was in fact not currently liable to pay or defer.

[69] For the above reasons, I would dismiss the Bell Canada and TELUS appeal.

[70] The premise underlying the Consumers’ Association of Canada appeal is that the disposition of some deferral account funds for broadband expansion highlighted the fact that the rates charged by carriers were, in a certain sense, not just and reasonable. Consumers can only succeed if it can demonstrate that the CRTC’s decision was unreasonable.

[71] At its core, Consumers’ primary argument was that the Deferral Accounts Decision effectively forced users of a certain service (residential subscribers in certain areas) to subsidize users of another service (the future users of broadband services) once the expansion of broadband infrastructure was completed. In its view, this was an indication that the rates charged to residential users were not in fact just and reasonable, and that therefore the balance in the deferral accounts, excluding the disbursements for accessibility services, should be distributed to customers.


[72] As previously noted, the deferral accounts were created and disbursed pursuant to the CRTC’s power to approve just and reasonable rates, and were an integral part of such rates. Far from rendering these rates inappropriate, the deferral accounts ensured that the rates were just and reasonable. And the policy objectives in s. 7, which the CRTC is always obliged to consider, demonstrate that the CRTC need not limit itself to considering solely the service at issue in determining whether rates are just and reasonable. The statute contemplates a comprehensive national telecommunications framework. It does not require the CRTC to atomize individual services. It is for the CRTC to determine a tolerable level of cross-subsidization.

[73] Nor does the traditional approach to telecommunications regulation support Consumers’ argument. Long‑distance telephone users have long subsidized local telephone users (Price Caps Decision, at para. 2). Therefore, while rates for individual services covered by the Telecommunications Act may be evaluated on a just and reasonable basis, rates are not necessarily rendered unreasonable or unjust simply because there is some cross-subsidization between services. (See Ryan, at §604, for the proposition that the CRTC can determine the appropriate extent of cross-subsidization for a given telecommunications carrier.)

[74] In my view, the CRTC properly considered the objectives set out in s. 7 when it ordered expenditures for the expansion of broadband infrastructure and consumer credits. In doing so, it treated the statutory objectives as guiding principles in the exercise of its rate‑setting authority. Pursuing policy objectives through the exercise of its rate-setting power is precisely what s. 47 requires the CRTC to do in setting just and reasonable rates.


[75] In deciding to allocate the deferral account funds to improving accessibility services and broadband expansion in rural and remote areas, the CRTC had in mind its statutorily mandated objectives of facilitating “the orderly development throughout Canada of a telecommunications system that serves to . . . strengthen the social and economic fabric of Canada” under s. 7(a); rendering “reliable and affordable telecommunications services . . . to Canadians in both urban and rural areas” under s. 7(b); and responding “to the economic and social requirements of users of telecommunications services” pursuant to s. 7(h).

[76] The CRTC heard from several parties, considered its statutorily mandated objectives in exercising its powers, and decided on an appropriate course of action. Under the circumstances, I have no hesitation in holding that the CRTC made a reasonable decision in ordering broadband expansion.

[77] I would therefore conclude that the CRTC did exactly what it was mandated to do under the Telecommunications Act. It had the statutory authority to set just and reasonable rates, to establish the deferral accounts, and to direct the disposition of the funds in those accounts. It was obliged to do so in accordance with the telecommunications policy objectives set out in the legislation and, as a result, to balance and consider a wide variety of objectives and interests. It did so in these appeals in a reasonable way, both in ordering subscriber credits and in approving the use of the funds for broadband expansion.

[78] I would dismiss the appeals. At the request of all parties, there will be no order for costs.

Appeals dismissed.

Solicitors for the appellant/respondent Bell Canada: Blake, Cassels & Graydon, Toronto.


Solicitors for the appellant/respondent TELUS Communications Inc. and the respondent TELUS Communications (Québec) Inc.: Burnet, Duckworth & Palmer, Calgary.

Solicitors for the appellants/respondents the Consumers’ Association of Canada and the National Anti‑Poverty Organization and the respondent the Public Interest Advocacy Centre: Paliare, Roland, Rosenberg, Rothstein, Toronto.

Solicitors for the respondent MTS Allstream Inc.: Goodmans, Toronto.

Solicitors for the respondent/intervener the Canadian Radio‑television and Telecommunications Commission: Torys, Toronto.



[1] Telecom Decision CRTC 2002‑34.

[2] Telecom Decision CRTC 2005‑69.

[3] Telecom Decision CRTC 2003‑15, and Telecom Decision CRTC 2003‑18.

[4]Telecom Public Notice CRTC 2004‑1

[5]Telecom Decision CRTC 2006-9.

[6]Telecom Decision CRTC 2008‑1.

[7]Telecom Decision CRTC 97‑9.

[8]Telecom Decision CRTC 94‑19.

[9]Telecom Decision CRTC 93-9.

[10]Telecom Decision CRTC 2003‑15, at para. 32.