Canada is entering one of the largest rail investment cycles in its history, with tens of billions of dollars being invested in new passenger rail systems, transit expansion, and network modernization across the country. This represents a once-in-a-generation opportunity to build a safer, more efficient, and globally competitive rail system.

Yet across the industry a troubling pattern persists: rising costs, delayed schedules, shrinking project scope, and procurement frameworks that often reward administrative compliance over proven capability. In some cases, Canadian rail projects now cost several times more per kilometre than comparable systems internationally.

These challenges are not the result of any single decision but reflect structural issues across governance, procurement models, workforce training, safety management, and supply-chain assurance.

Canada  has turned to international consultants for guidance, but while valuable insights have been gained, the results have often been mixed and the sector has at times become reliant on external advisory cycles rather than building lasting domestic capability.

Recognizing this, TRACCS leadership has begun early discussions with leading academic institutions to explore whether an independent research perspective could help examine the structural issues affecting Canada’s rail sector and bring greater evidence and analysis to the discussion.

Which raises an important question:

Is the challenge facing Canadian rail delivery the industry itself – or the way Canada procures it?

Below are ten procurement realities the rail sector increasingly recognizes but which are still rarely discussed openly.

The Top 10 Procurement Problems Canada’s Rail Industry Can No Longer Ignore

1. Procurement Often Confuses Compliance With Competence

Procurement frameworks frequently fail to fully recognise the importance of assurance of suppliers and contractors working in a live rail operating environment.

Delivering rail infrastructure requires far more than administrative compliance. It requires structured Safety Management Systems (SMS), Quality Management Systems (QMS), Environmental Management Systems (EMS) and, most importantly, proven competence of people working on or near the railway.

When procurement becomes primarily an exercise as a simple tick box paperwork rather than experience and operational readiness, projects are awarded to Constructor  that may not yet be fully prepared for the complexity of modern rail systems .

2. Projects Start Before Design Is Truly Ready

Across multiple rail programs, procurement and construction sometimes begin before engineering and design packages are fully completed.

This leads to redesign cycles, contract amendments, delays across the supply chain, and significantly increased project costs.

3. Lowest Price Still Dominates the Conversation

Although procurement frameworks increasingly reference cheapest procurement, price frequently remains the dominant factor in final award decisions.

In complex rail environments where safety, integration and operational reliability are critical, selecting contractors primarily on cost can create significant long-term delivery risks.

4. Cost Escalation Is Often Hidden Through Scope Reduction

Across several projects budgets are increasingly balanced by quietly reducing the scope of what will actually be delivered.

Stations, capacity provisions, and expansion features may be descoped after contracts are awarded, meaning the public ultimately receives less infrastructure than originally promised.

5. Governance and Standards Remain Fragmented

Canada’s passenger rail sector operates within a fragmented landscape of governance structures, engineering standards, and safety frameworks that vary across jurisdictions and projects.

This creates inefficiencies for agencies, contractors, and suppliers and makes it harder to develop a unified national rail capability.

6. Safety Culture Can Become a Dashboard Exercise

Safety performance is often communicated through KPI dashboards and statistics which, while useful, can sometimes mask deeper drivers of safety such as training, planning discipline, leadership, and operational readiness across the supply chain.

7. Contractors Are Reluctant to Speak Honestly

Many contractors and suppliers hesitate to raise concerns about procurement practices or delivery challenges for fear that doing so could affect future opportunities.

As a result, valuable feedback from those closest to the work is often lost.

8. Procurement Focuses on the Prime Contractor, Not the Full Supply Chain

Procurement frameworks often focus heavily on the prime contractor even though much of the work is delivered by specialist subcontractors and suppliers.

Without proper assurance and competency verification across the entire supply chain, gaps in readiness and capability can remain hidden until later in the project.

9. The Same Companies Keep Winning

Rail delivery ecosystems can gradually become concentrated around a small group of incumbent firms which, while experienced, can limit competition and make it difficult for smaller specialist companies to enter the market and grow within the sector.

10. The Taxpayer Ultimately Pays the Price

Public rail infrastructure is funded with the expectation that it will deliver modern and reliable transportation systems.

When procurement systems lead to delays, redesigns, or reduced project scope, the consequences are ultimately borne by the taxpayer.

The Conversation Canada Needs to Have – And What TRACCS Is Doing

Canada has the talent, technology, and engineering capability to build world-class rail systems.

But success will require more than funding. It will require procurement models that reward competence, stronger supply-chain assurance, and a willingness across the industry to have open conversations about what is working – and what is not.

TRACCS was created to help drive that conversation and support practical improvements across Canada’s rail sector.

The association is encouraging procurement approaches that prioritise proven rail delivery capability, supporting the development of stronger assurance frameworks across the supply chain, and advancing national training and workforce development initiatives that will help strengthen the long-term capacity of the Canadian rail industry.