Thirty-five years ago, Prime Minister Brian Mulroney’s cabinet debated privatizing VIA Rail, citing the Crown corporation’s heavy financial burden on taxpayers. Blacklock's Reporter says newly declassified documents from 1989 reveal that the railway was deemed "unaffordable" and in need of drastic action.“A decision about VIA is now quite urgently required as speculation about the government’s intention is on the rise,” stated minutes from a September 28, 1989 cabinet meeting. Members of Mulroney’s cabinet criticized the high subsidies paid to VIA, with some routes labeled “exorbitant” on a per-passenger basis.While acknowledging the political sensitivity of the issue, cabinet agreed that cost-cutting measures were driven by fiscal concerns rather than a broader transportation policy. “Cutbacks were made necessary by fiscal imperatives,” the minutes noted.The possibility of privatizing VIA Rail was discussed, with cabinet considering all options. “All privatization proposals will be considered,” the minutes confirmed. However, concerns were raised about the long-term viability of VIA’s reduced network and the potential for further cuts or public demands to restore services. Some members even questioned whether immediate termination of the service would be preferable.While no consensus on privatization was reached, the Mulroney government did go on to privatize several other Crown corporations between 1985 and 1988, including Air Canada, Petro-Canada, and Canadair Ltd.VIA Rail continues to face financial struggles today. In a 2023 report to Parliament, the railway outlined ongoing operating losses and projected further deficits. Last year, VIA posted a $381.8 million operating loss, up from $354.3 million the year before. The company expects losses in 2024 to reach as high as $430 million, the highest since the pandemic.“The economic environment is applying upward pressures on VIA Rail’s operating expenses,” said the railway’s 2023-2027 Corporate Plan, which forecast total losses of $2.1 billion over the next four years. The plan also highlighted the need for urgent fleet renewal, as the company continues to rely on aging equipment, with many locomotives and cars dating back to 1955.“Since the COVID-19 pandemic, VIA Rail’s financial performance was significantly affected,” the report stated, stressing the need for a new fleet to modernize operations and reduce long-term costs.
