The source of our funds
Find out where the Rail Fund gets the money to pay compensation.
Where does the money for the Rail Fund come from?
Crude oil shippers finance the Rail Fund through a levy. This levy is a fee imposed on each tonne of crude oil shipped by rail.
The federally regulated railway companies that transport crude oil in Canada collect and transfer these amounts to the Fund.
- The levy is collected only for the first time that the tonne of crude oil is moved by rail.
- This levy applies only to federally regulated railways. In reality, only a few carry crude oil in Canada
If there is a major rail accident, the money is available to:
- compensate victims for damages and losses
- compensate those involved in responding or cleaning up
- protect taxpayers
Is there a maximum amount the Rail Fund can pay to claimants?
There is no limit to how much compensation the Rail Fund can provide. If our balance is exhausted, the Minister of Finance can provide additional money from Canada’s Consolidated Revenue Fund.
How much is the levy on railway companies?
As of April 1, 2024, the levy is $2.07 per tonne of crude oil.
- This amount is adjusted annually based on inflation and the Consumer Price Index.
- The amount is set by the Minister of Transport, who is also able to raise, lower, or discontinue the levy
When do the railway companies pay the levy?
Railway companies must pay it on a quarterly basis every calendar year. We verify that the levies are received on time and are complete.
To learn more about how the levy is paid, visit Transport Canada
How much is added to the Rail Fund each year?
In addition to the amounts from the levies, the Rail Fund continues to grow from both the levy and interest.
Amounts collected from the levy, plus interest, since 2017
| Levy and interest collected each year | ||
|---|---|---|
| Year | Levy collected ($ million) | Interest collected ($ million) |
| 2016-2017 | 8.4 | 0.0 |
| 2017-2018 | 13.3 | 0.2 |
| 2018-2019 | 22.8 | 0.5 |
| 2019-2020 | 31.2 | 0.6 |
| 2020-2021 | 9.6 | 0.3 |
| 2021-2022 | 10.1 | 1.0 |
| 2022-2023 | 5.8 | 2.9 |
| 2023-2024 | 3.5 | 3.6 |
*Note: the 2016-2017 fiscal year was not a full year.
The polluter pays principle
A railway company involved in a major rail accident is responsible for damages and losses. Fault or negligence doesn’t have to be proven.
If more than one railway company is responsible, all the railway companies involved are liable. This means they are all responsible for compensating anyone affected by the accident.
The Rail Fund can provide resources to compensate anyone affected, while protecting taxpayers from the costs.
