Ottawa Proposes Capping Major Project Reviews and Approvals at One Year

Workers unload pipe to start right-of-way construction for the Trans Mountain Expansion Project, in Acheson, Alta., on Dec. 3, 2019. The Canadian Press/Jason Franson

Ottawa is proposing legislative changes that would cap federal reviews of all major projects, including pipelines, to one year.

The federal government announced on May 8 that it would begin a 30-day consultation process to gather input from the public, other levels of government, and the indigenous people on proposed reforms to streamline the approval process for major projects—not just those of national interest.

The Liberal government released two discussion papers during the announcement outlining a suite of proposals, including limiting federal reviews and decision-making timelines to 12 months once project proponents have submitted all the necessary information. To achieve that, the government is proposing to have federal impact assessments and permit reviews conducted at the same time rather than sequentially.

In addition, one of the recommendations calls for creating a regulatory system in which only one federal decision is needed for permits and approvals related to those projects.

The proposed changes come amid repeated criticism by industry groups, the opposition, and provinces such as Alberta and Saskatchewan that Ottawa’s regulatory process takes too long to approve major projects such as mines, pipelines, nuclear facilities, and transportation infrastructure. In August of last year, Prime Minister Mark Carney launched the Major Projects Office in a bid to reduce the approval timeline for these projects from five years to two years.

Speaking at a press conference in Montreal on May 8, Intergovernmental Affairs Minister Dominic LeBlanc said the latest proposed legislative reforms would strengthen Canada’s regulatory system for infrastructure building.

“These discussion papers explore ways to make our regulatory system more efficient for all major projects, and also address a number of long-standing issues in the transportation sector that are slowing down Canadian investment, foreign investment into Canada, and act as a brake on our productivity and our competitive advantage,” LeBlanc told reporters.

In a bid to strengthen investor confidence, the Carney government is proposing that certain projects, including pipelines and transmission lines, be reviewed exclusively by the Canada Energy Regulator and “no longer require a separate impact assessment” under the Impact Assessment Agency of Canada (IAAC).

As for nuclear and uranium projects, they would fall under the Canadian Nuclear Safety Commission but still require an impact assessment under the IAAC.

Another proposal involves establishing a “Crown Consultation Hub” within the IAAC, which would work with federal departments and agencies to ensure indigenous groups affected by a major project go through “one clear and coordinated consultation process for each project,” avoiding “consultation fatigue.”

The government is also seeking to grant some ministers more authority to override certain federal laws “that can make regulatory processes slow, repetitive, and less flexible.” One example would be authorizing LeBlanc, who also serves as minister of One Canadian Economy, to “adjust” environmental conditions for projects deemed to be of national interest, when needed.

The government said it will move “quickly” to table legislation once the consultation period is over.

‘No New Projects’

Ottawa’s latest proposals come nearly one year after its Bill C-5 was enacted last June. The legislation, known as the One Canadian Economy Act, was introduced and passed with the aim of speeding up approvals for major projects considered to be of national interest, and reducing interprovincial trade barriers.

Responding to the Liberals’ May 8 announcement, Conservatives said the there are still no major projects built despite promises by the Liberal government.

“Mark Carney has been Prime Minister for a year. He promised to build at ’speeds not seen in generations.‘ And today? Still no pipeline. Still no projects of ’national interest,'” Conservative Leader Pierre Poilievre said on social media on May 9.

The Conservatives say that instead of the government choosing which projects to fast-track or how to bypass certain regulations, it should instead remove legislation such as the Impact Assessment Act and the industrial carbon tax to allow the private sector to flourish and let the market itself determine which investments will succeed.

“Get this Liberal government out of the way and green-light projects now,” Poilievre said.

Meanwhile, the NDP accused the government of neglecting environmental regulations.

“The benefits will be real: for a handful of companies with already-bloated profits,” NDP Leader Avi Lewis said on social media on May 9. “The costs will be real too: a rising tide of economic and ecological disaster that sinks all boats.”

Carney commented on social media on May 8 that his government is committed to “get big things built faster.”

In an interview with The Canadian Press published on May 1, Carney said that a new pipeline in Canada was now “more probable than possible.” He cited the war in Iran as a factor that triggered global demand for energy security.

On May 7, the executive director of the International Energy Agency, Fatih Birol, met with federal Energy and Natural Resources Minister Tim Hodgson in Ottawa to discuss how Canada can contribute to reliable energy supplies.

“They discussed the energy impacts of the war in the Middle East and Canada’s opportunity to step up energy exports at this moment of crisis and in the years ahead,” the agency said in a news release.

The federal government’s May 8 announcement also included launching consultations on proposals to diversify Canada’s trade and attract new investments.

Meanwhile, Bank of Canada Governor Tiff Macklem told the Senate Committee on Banking, Commerce and the Economy on May 6 that international investors he spoke to are interested in Canada but are reluctant to put their money in due to regulatory concerns.

“What is holding them back has been very long regulatory approvals,” Macklem said. “The message is, ‘Look, if it takes five to 10 years to get regulatory approval, I’m not prepared to tie up my capital for that long.’”

A report by RBC in April found that more than $1 trillion in investment has left Canada over the past decade.

Olivia Gomm and The Canadian Press contributed to this report.