Canada’s first national railway, the Canadian Pacific Railway (CPR), was completed in 1885. This monumental project was a pivotal part of unifying Canada, as it provided a continuous rail link from the eastern provinces to British Columbia on the Pacific Coast.

The idea of a transcontinental railway was central to Canadian Confederation in 1867, especially in persuading British Columbia to join Canada in 1871. The federal government committed to constructing a railway to ensure economic and political cohesion across the vast country, securing trade routes and facilitating settlement.

Impact

The CPR was essential for transporting goods, resources, and settlers, contributing significantly to Canada’s economic growth and expansion into western territories. The railway remains a symbol of Canadian national unity and a major accomplishment in infrastructure and engineering of the time.

The Canadian National Railway (CNR), another transcontinental railway, was established later in 1919 as a public enterprise to consolidate several bankrupt railways, including portions of the CPR network, and further support Canada’s infrastructure and economy​

When Canada contracted the Canadian Pacific Railway (CPR) to build the first transcontinental railway, the government offered several incentives, and both the CPR and the government had obligations to fulfill as part of the agreement. Here are the main elements:

Promises and Obligations to CPR:

1. Land Grants: The Canadian government provided the CPR with 25 million acres of land along the railway route. These lands could be sold by the railway to settlers and businesses, which would help finance the railway’s operations and create demand for its services.
2. Financial Subsidy: The CPR received a cash subsidy of $25 million from the government. This was a significant investment at the time and was meant to cover some of the vast costs of building the railway across difficult terrain and through sparsely populated areas.
3. Monopoly on Certain Routes: The government guaranteed the CPR a monopoly on rail transport between particular routes, especially the primary corridor through western Canada. For example, the CPR was given exclusive rights to routes that directly connected Canadian regions, particularly in Western Canada, which discouraged competition on this corridor.
4. Tax Exemptions: The CPR was also exempt from various taxes, including property and income taxes on railway lands and operations. This was meant to make the railway more financially sustainable and attractive to private investors.

Obligations of the CPR:

1. Completion Deadline: The CPR was required to complete the railway within 10 years of the contract signing. This was a strict deadline, as the government saw the railway as a crucial element of unifying Canada and promoting western expansion.
2. Affordable and Accessible Rates: CPR was expected to keep its rates within reasonable limits so that it would be affordable for settlers, businesses, and government to use. This was part of the government’s vision to encourage settlement and economic growth across Canada.
3. Support for Settlements: Part of CPR’s obligations was to sell land it received from the government to settlers, which would help to populate and develop western Canada. This was intended to stimulate economic activity and settlement along the railway route.

Compensation and Outcome

The generous land grants and financial subsidies were a form of compensation for the enormous cost and risk associated with building a railway across such a vast and sparsely populated country. The project cost the Canadian government a great deal, but it helped ensure that the railway was completed and economically viable for the CPR.

The completion of the railway allowed Canada to secure its western territories and promoted economic integration and development, although the monopoly and land grants were later sources of controversy, as settlers and businesses sometimes found the rates uncompetitive due to the CPR’s exclusive rights​

Diminished Service
Historically, Canadian railways like the Canadian Pacific Railway (CPR) and later the Canadian National Railway (CNR) had significant obligations to maintain passenger rail services as part of the original agreements and incentives granted by the government. However, over time, these obligations were either altered or removed due to economic, political, and logistical factors, leading to today’s limited passenger rail services.

Historical Obligations for Passenger Rail Service

When the Canadian Pacific Railway was established in the 1880s, it was expected to provide both freight and passenger services as part of its mandate. The federal government viewed passenger rail as essential for connecting communities across Canada, especially in remote areas. The original agreements did not strictly outline detailed, enforceable service levels but implied that the railways would meet public demand for both freight and passenger travel.

As the industry evolved, particularly with the rise of automobile travel in the mid-20th century, passenger rail became less profitable. Both the CPR and CNR began shifting focus toward freight, which was more lucrative, and sought to reduce or discontinue unprofitable passenger routes.

This has implications as people have shifted from efficient trains to inefficient personal automobiles.
because 38% of BC Greenhouse Gas emissions come from transporation, our lack of passenger rail service including the minimal West Coast Express service really has us at a disadvantage and takes choices for personal action off the table, leaving us with less choice.

Government Intervention and VIA Rail’s Formation

By the 1960s, both CPR and CNR had significantly reduced passenger services due to declining ridership and financial losses. To address the gap and maintain national passenger services, the federal government created VIA Rail Canada in 1977, taking over most passenger rail operations from the two major railways. VIA Rail was established as a Crown corporation specifically for the purpose of preserving intercity passenger rail services across Canada.

However, VIA Rail operates with limited funding and subsidies, which restricts its ability to maintain or expand services. Unlike railways in some other countries, VIA Rail does not own most of the tracks it operates on. Instead, it leases access from freight rail companies like CN, which prioritize freight over passenger rail due to economic incentives, often causing delays and limited scheduling options for passenger services​

Modern Regulatory Landscape

Currently, no strict legal obligations require Canadian freight rail companies to maintain or improve passenger rail infrastructure or services. VIA Rail’s existence has effectively transferred the responsibility for passenger rail to the federal government. However, without sufficient investment or prioritization, passenger services continue to suffer from outdated rolling stock, limited service routes, and neglected stations.

Efforts to improve rail service have been proposed, including high-speed rail projects in regions with high demand, such as the Toronto-Montreal corridor, but these remain largely in the planning stages. Advocacy for increased funding and infrastructure improvements is ongoing, as many Canadians recognize the need for reliable, sustainable passenger rail.

Summary

The initial agreements with CPR and CNR implied responsibilities for passenger service, but these were diminished over time. The creation of VIA Rail was a government response to sustain some level of service, but without mandatory obligations on freight rail companies or increased public funding, passenger rail in Canada has struggled.

How Can we Revive Passenger Rail in Canada?

To motivate Canadian railways to provide passenger rail service that competes with private automobiles and airlines, several key factors would need to be addressed. These changes would require a combination of public policy shifts, financial incentives, infrastructure investments, and regulatory adjustments. Here’s a breakdown of what would be needed:

1. Significant Investment in Infrastructure

• Upgraded Tracks and Stations: Current passenger rail in Canada often shares tracks with freight trains, leading to delays and less frequent service. Building dedicated high-speed passenger rail corridors, particularly in densely populated regions like the Windsor-Quebec City corridor, would allow for competitive speeds, reliability, and frequency.
• Modernized Rolling Stock: Much of VIA Rail’s equipment is outdated. New, high-speed, and energy-efficient trains would be essential for making rail travel attractive, with faster travel times and enhanced comfort.
• Station Upgrades: Improving station facilities to make them more accessible, comfortable, and technologically advanced would contribute to a more convenient and appealing passenger experience.

Countries like France and Japan have demonstrated the success of high-speed rail (HSR) projects through extensive government investment in infrastructure that supports passenger rail exclusively. In these countries, high-speed rail competes directly with airlines on shorter routes because of its convenience and comparable travel times.

2. Public-Private Partnerships (PPP) and Incentives

• Tax Credits and Subsidies: The government could offer financial incentives to private rail companies to encourage investment in passenger rail services. Tax credits, low-interest loans, or operational subsidies would help offset costs and encourage private sector involvement.
• Revenue-Sharing Models: Structuring revenue-sharing agreements for ticket sales or other forms of compensation could make passenger rail more attractive to private operators, who currently prioritize freight due to its profitability.

In Europe, some high-speed rail services operate as public-private partnerships, where private operators run trains on publicly funded infrastructure. This model balances public investment with private operational expertise, allowing for competitive service levels.

3. Prioritization of Passenger Rail Over Freight on Shared Tracks

• Regulatory Adjustments: Currently, freight often takes priority on shared rail lines, causing frequent delays for passenger services. Adjusting regulations to prioritize passenger rail or to mandate time slots exclusively for passenger use would improve service reliability and make train travel more attractive.
• Lease Agreements and Access Rights: Revising the lease agreements that VIA Rail and other passenger services have with freight operators like CN to ensure better access and priority would improve both frequency and timeliness.

In the United States, Amtrak has successfully negotiated priority access in certain regions, although challenges remain. Regulatory changes to ensure this priority more consistently could create more competitive rail service.

4. Competitive Pricing and Ticketing Options

• Government Subsidies for Tickets: Subsidizing ticket costs for passengers, similar to the way airlines receive subsidies in certain routes or how transit systems are often publicly funded, could reduce costs for passengers.
• Flexible and Integrated Ticketing: Implementing modern, digital ticketing systems with flexible pricing, loyalty programs, and integration with other transportation modes (like buses and car-sharing) would improve convenience.

Germany’s national rail service Deutsche Bahn offers flexible pricing and extensive loyalty programs, making rail a popular and affordable choice.

5. Environmental and Economic Incentives

• Carbon Pricing and Environmental Mandates: By implementing carbon pricing that reflects the environmental cost of air and car travel, rail could become a more cost-effective and attractive option for eco-conscious travelers.
• Mandates for Sustainable Transportation: Government mandates on reducing greenhouse gas emissions could push for a shift from car and air travel to rail, aligning with Canada’s climate goals.
• Canada has abundant renewable electricity: So the electrification of rail travel could make a significant difference in offering an option that is Climate friendly.

In the UK, rail is promoted as a greener choice, and subsidies are provided to make it a competitive option as part of the country’s environmental strategy.

6. Dedicated High-Speed Rail Projects in Key Corridors

• Targeted Development of High-Speed Rail Lines: High-speed rail works best in areas with high population density and demand. A dedicated high-speed rail line between major urban centers like Toronto, Ottawa, and Montreal would allow rail to be competitive with flights and driving.

Example: The Windsor-Quebec City corridor has been identified in numerous studies as the best candidate for high-speed rail in Canada. A dedicated line would provide a fast, convenient, and sustainable option for millions of Canadians.

7. Public Awareness and Marketing

• Marketing Campaigns: Raising public awareness about the benefits of rail travel—such as reduced carbon emissions, reduced travel stress, and competitive travel times—could increase demand.
• Partnerships with Tourism Boards: Collaborating with tourism boards to promote rail travel as a comfortable, scenic way to explore Canada could also drive demand and investment.

Example: Amtrak’s advertising campaigns in the United States highlight the scenic value of train travel, particularly along the coast and through national parks, which has boosted tourism-related rail travel.

Achieving These Changes

Implementing these improvements would require collaboration between federal and provincial governments, private companies, and communities. A phased approach, starting with high-priority corridors and regulatory adjustments, could make the transition more manageable. While these changes involve high upfront costs, the long-term benefits—including reduced road congestion, lower greenhouse gas emissions, and improved accessibility—would provide value for Canadians and align with climate and economic goals.

In summary, substantial investment in infrastructure, policy changes to incentivize private companies, regulatory adjustments, and public awareness efforts are essential pieces to make passenger rail in Canada a viable, attractive, and competitive option alongside cars and airplanes.

Action
So clearly the recent news of Canada’s first high speed rail is welcome. This kind of massive infrastructure can only come about with government setting policy, funding and incentives. It takes will. To read that the CPR was built so quickly is mind boggling by today’s standards where the smallest projects take years. We also need businesses that can be innovative, delivering projects safely and much more quickly and economically, rather than treating the government (your taxes) like the golden goose.
For these kinds of items, we must take action to reach, inform and motivate government leaders.