DAILY NEWS Feb 28, 2013 10:17 AM - 0 comments

CTA warns US spending cuts could cause 'massive' disruptions to businesses

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2013-02-28

OTTAWA, Ont. -- The Canadian Trucking Alliance says that cuts to US federal government spending, set to automatically kick-in tomorrow, could cause “massive” disruptions to Canadian businesses.

The automatic spending cuts (known as sequestration) were averted in January when talks aimed at keeping the US from going over the “fiscal cliff” provided a two-month reprieve. Since the reprieve, Democratic and Republican lawmakers have been unable “to overcome their partisan bickering and resolve the budget impasse,” according to the CTA.

CTA says that Canada could be “particularly impacted” by the budget issue because of its reliance on US trade, adding that border operations themselves could also be “severely impacted.”

In testimony before the Senate Committee on Appropriations on Feb. 14, Janet Napolitano, Secretary of the US Department of Homeland Security said the automatic budget cuts that would be imposed on the US Customs and Border Protection (CBP) agency “would make four to five hour wait times (at the border) commonplace and cause the busiest ports to face gridlock situations at peak periods.” She explained how front line CBP staff responsible for processing trucks will be furloughed and overtime budgets to meet peak and unplanned demand will be slashed.

The CTA has said it will stay in contact with port officials to keep on top of the situation and pass information along to trucking companies so they can better prepare to cross the border during off-peak periods.

“At this point the only thing we can do is prepare for the worst,” says David Bradley, president and CEO of the CTA. “Whether a last-ditch deal can be made or the full-brunt of the cuts would be felt immediately, we just don’t know. We are entering the unknown and uncertainty can be just as bad as actual delays.

“The North American economy cannot afford to revert to the way it was during the bad old days when truck drivers were delayed at the border for hours on end, wasting fuel, missing delivery windows and exhausting allowable driving hours. Manufacturers and retailers were forced to hold costly inventories to cope with uncertain border transit times and just-in-time turned into just-in-case.

“A predictable, reliable and efficient border is an absolute necessity if the North American supply chain is to be competitive,” he added.


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