Canada. Royal Commission on Transportation (1959-1961) : The Royal Commission on Transportation was established under Order in Council P.C. 577, 13 May 1959, under Part I of the Inquiries Act (RSC, 1952, c.154) and on the recommendation of the Prime Minister. The Commission was mandated to inquire into and report on the problems relating to railway transportation in Canada and the causes thereof, and to recommend solutions including: (a) inequities in the freight rate structure, their effect upon the various regions of Canada and the legislative changes that can and should be made to alleviate such inequities; (b) the obligations and limitations imposed on railways by law and what should be done to ensure a more equitable distribution of any burden; (c) the possibilities of achieving more economical and efficient railway transportation; and (d) whether, and to what extent, the Railway Act should specify what assets and earnings of railway companies in businesses and investments other than railways should be taken into account in establishing freight rates. The Commissioners were Charles P. McTague, Chairman; Arnold Platt, Murdock Alexander MacPherson, Herbert Anscomb, Archibald H. Balch, René Gobeil and Howard Mann. The Chairman, Charles P. McTague, resigned from the Commission shortly after his appointment and was succeeded by Murdock A. MacPherson (Order in Council P.C. 1628, 22 December 1959). The Secretary was F.W. Anderson.
From 1948 to 1958, rising wages and prices affected freight rates in Canada. Business recessions, especially in 1954 and 1957, and competition from highway and inland waterways reduced railway revenues below expectations. Hence, the railways were forced to apply to the Board of Transport Commissioners for further increases in freight rates. The board had already approved 14 general increases from 1948 to 1958, but the Crow's Nest and related rates, especially for the movement of grain, were excluded. The Diefenbaker government, which came to office in June 1957, declared itself against freight rate increases. This move was strongly supported, particularly in the Maritimes and Western Canada where were an important issue. Rates were a strong enough issue that when the board authorized an increase in rates of 15 per cent to take effect on 15 January 1958, the government delayed the date of increase until after the general election of March 1958. On 29 April, after the Progressive Conservatives were returned to power, they rescinded the increase altogether. Meanwhile, negotiations between the railways and unions on a new contract for 1958-59 dragged on to the fall of 1958. A conciliation board recommended a settlement that would have meant spending an additional 7.8 million for the two major railways over the remaining 14 months of the contract period. Even though they faced a national strike, the railways were unable to accept the conciliation board's report until they had assurances from the government that they would be permitted to increase their rates to cover the cost of higher salaries. They applied to the Board for an immediate increase in freight rates of 19 per cent. The board authorized a 17 per cent increase which was to take effect in December 1958. Against the protest of several provinces, the federal government accepted the board's decision. This step solved the issue for the moment, but in the speech from the throne of 15 January 1959, the government announced that it wanted "to alleviate the discriminatory effects of the recent horizontal increases in freight rates." So in 1959, when the railways applied to the board for a further increase of 12 per cent, the government took three steps. First, it appointed a royal commission to study the railway problem; second, it forbade the Board of Transport Commissioners from authorizing further increases in the general level of rates pending receipt of the report of the royal commission; and third, it passed the Freight Rates Reduction Act which gave the railways a subsidy of 0 million for the fiscal year ending 31 March 1960, and provided for a roll-back in freight rates. This action cut the increase that was allowed in December 1960 from 17 per cent to 10 per cent and later to 8 per cent. By these measures, the government hoped it would not have to take any further action on the issue until after the Royal commission had reported. As it turned out, the government was forced to grant subsidies to the railways for some time to come, not only to prevent increases in the general level of freight rates but also to allow the railways enough revenue to meet wage demands. (See A.W. Currie, Canadian Transportation Economics, Toronto, University of Toronto Press, 1967, pp. 16-18 and H. Darling, The Politics of Freight Rates, Toronto, McClelland and Stewart, 1980, pp. 184-210.)
Hearings of the commission were held in fourteen cities in Canada, including the capitals of the ten provinces, and Montreal, Ottawa, Port Arthur and Vancouver, from 17 September 1959 to 17 January 1961. There were 153 submissions and 185 exhibits filed with the commission. RG33-49 General Inventory
