The News Rundown

Transport minister to summon airline CEOs as Air Canada set to charge carry-on fees for some passengers

Canadian travellers this week were surprised by an announcement by Air Canada that it will charge some passengers for carry-on bags in the new year.
Starting on Jan.3, Air Canada passengers buying basic fare tickets for North American and sun destinations in Mexico and the Caribbean will have to pay a carry-on fee of $35 for the first bag and $50 for the second. Small personal items (16 by 33 by 43 centimetres) like a purse or computer bag will still be allowed on board for free. Those passengers will also be charged for seat selection change at check-in, starting on Jan. 21. Other international destinations will still allow you to bring one personal article and one carry-on bag.
Transport Minister Anita Anand says she will be calling Canadian airline CEOs to a meeting in mid-December after Air Canada's announcement. Anand said in an interview with CTV Power Play with Vassy Kapelos on Wednesday: “Let's just say I'm not very happy today with what I've heard from Air Canada. I think they need to take a look at the persons that they are targeting with these excess fees. It is not acceptable.”
Anand says she recognizes the extra fees are a business decision made by Air Canada, but says she is “extremely disappointed.”
Air Canada says the new charges are “not new in the Canadian industry and is merely our competitive response,” adding the company “will be pleased to explain this to the government if desired.” Air Canada said: “the adjustments we have made to certain of our fares is a commercial decision that we took only after our main competitors in Canada enacted similar policies quite some time ago.”
Back in June, WestJet rolled out its "UltraBasic" ticket tier that does away with a free carry-on bag and charges a fee for seat selection, including after check-in, whether online or in-person. Discount carrier Flair Airlines has a similar policy.
During the COVID-19 pandemic in 2021, the federal government reached a deal with Air Canada to provide a nearly $6 billion bailout package. As part of the agreement, the government purchased $500 million worth of the company’s shares, representing a six per cent equity.
Asked by Kapelos whether she will use the federal government’s equity in Air Canada to leverage change, Anand said she’s “examining the particular legal relationship right now” and will have more to say “in the days ahead.”
More than two years ago, the Liberals promised changes to what is informally known as the air passenger bill of rights, following significant travel delays and cancellations both over the summer months and during the 2022 winter holiday season.
The 2023 budget laid out a series of measures to strengthen air passenger rights — including measures to increase levels of service and reduce delays — but those didn’t relate to added fees associated with flight costs.
The move by Air Canada marks a shift toward a budget airline-style offering from Canada’s flag carrier, which along with rivals has relied increasingly on ancillary fees for formerly bundled services that range from checked bags to on-board snacks and Wi-Fi access.
U.S. carriers such as United Airlines, Delta Air Lines and American Airlines have similar categories, though American and Delta still allow basic economy travellers to bring a bag onto the plane at no cost.
Customers need to be aware that what they see as the lowest fare on a price comparison search may not wind up being the cheapest option once the fees are tallied. Richard Vanderlubbe, founder of Hamilton, Ont.-based travel agency Tripcentral.ca said: "It’s not transparent until you’ve gotten a certain depth into the booking: ‘Oh, here’s the seat selection fee. Oh, here’s the baggage fee. Oh, here’s the carry-on fee.’ And watch out if you don’t check in online, there’s a massive penalty if you don’t. It’s kind of drip, drip, drip, drip. And it works. It's a troublesome trend."
Competitor Flair Airlines on X said: “Now the choice should be clear. The products are the same, one just costs way less.”
That’s not always true. Some Toronto-Vancouver tickets in March start at $129 for Flair and $135 for Air Canada and WestJet. Other routes see a bigger difference, with Calgary-Toronto priced at $139 for Flair, $209 for Air Canada, $175 for WestJet and $198 for Porter.
One thing is for sure, people flying by air in Canada have less options than before, and are getting nickel and dimed for everything, on top of the already high airfares and airport taxes that make Canadian flights some of the most expensive by distance travelled within the Western world. Something needs to change, and it's not something that this unpopular federal government is likely to be able to tackle.
Supplementals:

https://www.cp24.com/news/canada/2024/12/04/air-canada-to-bar-carry-on-bags-impose-seat-selection-fee-for-lowest-fare-customers/

This week Alberta Transportation Minister Devin Dreeshen announced that Alberta will be drastically cutting back on the number of photo radar sites in the province.
The term ‘cash cow’ comes to mind and in particular with how Edmonton has used photo radar.
Photo radar will be banned from use on all numbered Alberta highways with it instead restricted to playgrounds, school zones, and construction sites.
All 2,200 sites will be reviewed with a goal of getting down to 650 next year.
Remaining sites will focus on safety while those specifically set up to make money will be shut down.
There has been controversy in the past with Edmonton’s use of photo radar and the hunt for revenue it has generated.
Edmonton’s officials say that collisions were down 18% and speeding has gone down.
Dreeshen says that instead of relying on photo radar they should look at re-engineering roads and intersections to be safer rather than relying on photo radar. The province will provide monetary aid on this re-engineering.
One would be forgiven for thinking that abolishing the use of photo radar is specifically a UCP priority but it’s been discussed before.
In 2019 then NDP Transportation Minister Brian Mason planned to eliminate photo radar.
In February that year before the NDP were defeated in that year’s election Mason said, “I think in some cases photo radar in the province of Alberta has been a cash cow. It's my intention that we are going to humanely put the cash cow down.”
Now NDP leader Naheed Nenshi says that the UCP is taking a callous attitude towards public safety.
But Nenshi also said that, “everyone hates fishing holes, everyone hates it when any kind of enforcement is used unfairly.”
The interesting part about this is that’s entirely the point of the government in the changes that they are wanting to make. He also continued by saying the UCP isn’t interested in governing and that “they’re interested in things they themselves think are cute.”
This response from Nenshi that both confirms what the UCP government is doing is something most Albertans are in favour of while also delving into childish name calling summarizes the NDP of today in the province.
This week the province’s suite of legislation on issues pertaining to trans athletes, school curriculum, and medical treatments passed and the NDP let it pass with little fanfare.
Does the province have an opposition? That’s an interesting question to think about after this week.
Mark Neufeld, the head of the Calgary Police Service and president of the Alberta Association of Chiefs of Police criticized the move saying that the announcement was inappropriate due to not respecting those that may have been killed on the roads and that photo radar is something the Calgary police feel is working.
The reality of the photo radar changes is that when the changes are implemented Alberta will have the same amount of photo radar sites as Ontario, Canada’s biggest province. This is still more than any other province.
So while the alarm bells are going off one can ask if we were truly ahead in terms of traffic safety or if we are indeed over saturated.
Supplementals:

Police support crumbles for B.C.’s decriminalization experiment

It appears that the decriminalization experiment has completely failed in BC, and the province is worse off for having tried such a radical approach to curb overdose deaths that actually ended up increasing deaths instead.
This week, the British Columbia police chiefs have pulled their support for the province’s decriminalization project — a move that serves to underscore just how confusing, contradictory and politically untenable the entire issue has become.
The Canadian Association of Chiefs of Police issued a statement late last week saying “since the exemption came into effect, police have witnessed trends of concern, including a continued high rate of opioid overdose deaths as well as growing fear among law-abiding community members due to public drug use and drug-related criminal activity.
The association said: “As a result of the experience in British Columbia associated to the January 2023 three-year exemption under the Controlled Drugs and Substances Act that decriminalized the possession of small amounts of certain illicit drugs for personal use in British Columbia, the CACP Board no longer supports the decriminalization of any amount of illicit drugs for personal use,” the association said.
B.C.’s top Mountie, Deputy Commissioner Dwayne McDonald, sits on the Canadian police board, as does Victoria Police Chief Del Manak.
Within a day, the B.C. Association of Chiefs of Police issued their own statement saying it “stands in alignment with the Canadian Association of Chiefs of Police in its position on decriminalization and its role in addressing the ongoing toxic drug crisis.”
The move is significant, because the NDP government has long cited police support for decriminalization as a core justification for starting the three-year pilot project to legalize personal possession of small amounts of illicit drugs like cocaine, heroin and meth.
The hope was that decriminalization could free up police resources, reduce stigma, encourage drug users to step forward for treatment, and, yes, reduce overdose deaths (though advocates and government would later pretend reducing deaths was not an actual stated goal).
That didn’t happen. Instead, public drug use, street disorder and toxic drug deaths worsened before immense political pressure forced Premier David Eby to backtrack and recriminalize drugs in nearly all public places in April.
Technically, decriminalization remains in place in private spaces, though media reporting on that fact last April did not mention as such. The government has asked police to only enforce drug possession in extraordinary situations in public. The justification to keep it in place for private spaces, like homes, is that returning prohibition might scare people away from calling for help in an overdose. Yet, that isn’t being tracked or measured in any way to determine if it’s successful.
It makes you wonder why the police chiefs are wading into the issue at all now. No one was available for interviews, and the B.C. statement contains frustratingly vague language like: “Based on evidence and ongoing evaluation, we no longer view decriminalization as a primary mechanism for addressing the systemic challenges associated with substance use.”
Health Minister Josie Osborne said in a statement: “We agree with the Chiefs of Police — decriminalization is not a primary mechanism to addressing the systemic challenges associated with substance use. Public drug use is illegal in all public spaces, and police have the tools to stop this activity.”
Still, it makes you wonder why they only walked back a part of the experiment, and not the entire program. Optics maybe?
BC Conservative MLA Elenore Sturko said she believes police are acting in the wake of the October election to push back against other pro-decrim organizations and reiterate their stance to the new cabinet members in the Eby government.
Sturko said: “The police did support decrim but there were some significant caveats to that support, and that included robust treatment, having places for people to go, and a huge array of potential supports that didn’t materialize. I really see it as the police really had no choice to withdraw their support, because what they were giving their support to didn’t exist. Because the NDP put this project together the way that they did there were actually harms that happened in the community.”
According to new figures from Statistics Canada, B.C. led Canada with 40.3 deaths per 100,000 population in 2023, followed by Alberta (26.1) and Saskatchewan (22.9). The figures appeared as part of a broader report tracking deaths and life expectancy in Canada released Dec. 3. As of Sept. 30, 1,749 British Columbians had died of unregulated drugs, by far the leading cause of unnatural death in B.C.
In the absence of a definitive government position on the future of decriminalization, the public is left with a wildly confusing situation.
To sum up, decriminalization is still in place, sort of. The police used to support it, but now don’t. The government agrees with the police, but not enough to act. Politicians still hope decrim will help in some situations, but aren’t measuring how. The research data that was supposed to guide the whole project is ruined. And there’s still another year left, with no signal from the government if it will renew or let the endeavour expire.
In short, it’s a mess. The statements from police are just another reminder — nobody is happy with the current situation, not the public, not the police, not advocates on either side of the issue, and not even the politicians.
Supplementals:

https://www.pentictonwesternnews.com/news/bc-led-canada-in-accidental-drug-poisoning-deaths-in-2023-7689831

Firing Line

We're in a recession,' says former Bank of Canada governor Stephen Poloz

Last week’s discussion of the federal GST break led to Finance Minister Chrystia Freeland suggesting that Canada was in a ‘vibecession’ and that the economic woes people were feeling may not be real.
This week former Bank of Canada governor Stephen Poloz said that Canada is in a recession and that has been tweaked by strong population growth.
Poloz said that it’s likely an actual recession and not a technical recession.
For our listeners who don’t read economic news often a technical recession is one where you have 1-2 quarters of negative growth in a row.
Poloz said, “a technical one is a superficial definition that you have two quarters of negative growth in a row, and we haven’t had that, but the reason is because we’ve been swamped with new immigrants who buy the basics in life, and that boosts our consumption enough.”
When looking at the actual growth numbers it was announced last week that growth declined for the sixth consecutive quarter falling by 0.4% in Q3. This measure has been negative for 8 of 9 last quarters.
Total growth in the economy for the year came in at 2.1% in the second quarter before dropping to 1% in the third quarter.
Now you might be wondering, how is that not already a recession? What is driving the growth?
According to Poloz it’s due to government spending and that is also the likely reason we saw GDP pop up slightly.
Inflation drove prices up by 30% when inflation was increasing and inflation came down quickly and that only happens in a contracting economy.
Factoring in these tariffs coming in January we could be looking at an additional 2.6% contraction to the Canadian economy.
Poloz also said that the GST cut coming for December on certain products is good to help stimulate consumer spending but will do little to improve long term economic growth.
With that we’re left with even more questions about the economy after last week's assertion by Freeland and others that it’s merely a ‘vibecession’.
It also raises questions about what fiscal wiggle room the government has to increase spending to stimulate the economy.
Since the government has been running under fiscal stimulation since 2017 we have to add even more should there be a time when directed government aid is needed.
The 2009 recession and financial collapse was a lesson for many, in particular that you can’t build an economy back up based on the service and consumption industry.
Primary industries like resource extraction need to be strong. As do secondary sectors like manufacturing and processing.
The service industry provides jobs for many and it’s where everyday Canadians put their money and with enough of it you can see economic growth but it’s not long term economic growth that can build GDP.
GDP or the gross domestic product measures the total value of goods and services produced in a country.
Immigration is having an effect, it was one of the drivers of inflation. These problems have come home to roost.
What was once a series of small issues on their own have become bigger and more impactful and are having a systemic strain on the economy.
The government needs a wholesale turnabout on how the economy is managed before things begin to get better.
That addresses the government side but the media is absent too since they aren’t reporting on why Canadians are feeling what they’re feeling.
It’s certainly not a vibecession as was stated last week and it may be something much worse as we head into 2025.

Quote of the Week

"It’s not transparent until you’ve gotten a certain depth into the booking: ‘Oh, here’s the seat selection fee. Oh, here’s the baggage fee. Oh, here’s the carry-on fee.’ And watch out if you don’t check in online, there’s a massive penalty if you don’t. It’s kind of drip, drip, drip, drip. And it works. It's a troublesome trend." - Richard Vanderlubbe, founder of Hamilton, Ont.-based travel agency Tripcentral.ca, on Air Canada’s new carry-on charges.

Word of the Week

Fare - the price charged to transport a person

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Show Data

Episode Title: Faring Worse
Teaser: Air Canada will now charge for carry-on bags, Alberta is scaling back photo radar, and the police no longer support decriminalization in BC. Also, former Bank of Canada governor Stephen Poloz says we may be in an actual recession.
Recorded Date: December 7, 2024
Release Date: December 8, 2024
Duration: 54:02
Edit Notes: None

Podcast Summary Notes

Duration: XX:XX