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Earlier this year, the Caisse de dépôt et placement du Québec proposed a 67 km system of light-rail transit (LRT) for Greater Montreal. However there are several potential problems associated with the Réseau électrique métropolitain (REM) proposal that have not received sufficient attention. They include:

Accountability: The Caisse is a semi-private pension fund that answers to a board of directors and depositors, not the Montreal electorate. Assigning responsibility for planning a new transit system to a financial institution rather than a transportation planning agency accountable to elected officials could lead to a system designed to meet the financial needs of the Caisse rather than strengthening the performance of transport in the Montreal region.

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Subsidies: The Caisse would invest $3 billion in the project if the federal and provincial governments provide up to $2.5 billion between them. Beyond this, the Caisse says it would not require any further public subsidies; it expects to recover its capital investment, pay for operating costs, and make a profit, mostly from the fare-box revenue. The Canadian average for the recovery of transit operating costs from fares is only 60 per cent. And that doesn’t take into account recovering capital costs. The Caisse says the system’s driverless technology would keep operating costs low. But the Vancouver LRT system — also driverless — requires a substantial subsidy even though it has 328,000 boardings per weekday, compared to the 150,000 per weekday projected for the REM.