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The Canada Safety Council is calling Canada's rail system a disaster waiting to happen, and it blames deregulation for the mess.

The council's Emile Therien told Â鶹ӰÊÓ that one possible result could be the "major evacuation of a major urban area ... and all the attendant cost that goes along with that."

To ward that off, "CSC strongly urges the government to reinstitute the authority of Transport Canada," said the council's report, obtained Monday by Â鶹ӰÊÓ.

The CSC said the move to deregulation "allows rail companies to regulate themselves, removing the federal government's ability to protect Canadians and their environment, and allowing the industry to hide critical safety information from the public."

B.C. New Democrat MP Peter Julian added his voice to the criticism.

"Since self-managed safety was put into place, it has been a disaster for Canadians. Lives have been lost; we've seen environmental devastation," he said.

Safety Management Systems (SMS) came into force in 1999 after the Liberal government of the day amended the Railway Safety Act.

The policy change ended the oversight role of Transport Canada.

"CSC believes that SMS allows rail companies to regulate themselves, removing the federal government's ability to protect Canadians and their environment, and allowing the industry to hide critical safety information from the public," the report said.

CTV's W-FIVE has reported on serious problems within Canada's rail system, including a large jump in derailments in 2005.

The CSC report noted W-FIVE's finding that in 2005, there were 103 main-track derailments for one "major rail company" in 2005 -- an average of one every 3.5 days. The report termed that "a truly dismal safety record." W-FIVE named CN Rail as the company in its report.

One such incident was the derailment near Lake Wabamun, Alta., which led to the spill of oil and wood preservatives into the popular recreational lake.

Two days later, another CN train derailed over the Cheakamus River just outside Squamish, B.C., dumping more than 40,000 litres of caustic soda.

And in 2006, a derailment in B.C. left two train crew members dead.

Industry reaction

However, the industry argues that one year doesn't tell the story.

Cliff MacKay of the Railway Association of Canada agrees there was a spate of incidents in 2005, but argue many were linked to extraordinary factors like weather events and labour disruptions.

"But if you look at the numbers overall, the numbers have been progressively improving," he said.

CN Rail, which has seen some of the worst incidents, rejected the CSC report outright.

"They didn't do their homework," said spokesperson Mark Hallman, adding it was based on a "faulty, biased" report by W-FIVE.

The CSC report is one of many that will end up on the desk of Transport Minister Lawrence Cannon.

"If there was not a problem ... we would not have the panel struck by the minister to really look into safety in the railroad industry," Therien said on CTV's Canada AM.

The government isn't planning to look at any changes to rail safety until the end of 2008. The safety council said the problem is urgent and action is needed now.

Therien is calling on Transport Canada to get involved again as the railway regulator.

"They've got to become effective to get back into that particular game," he said Tuesday.

"The railroads cannot be allowed to review or vet the safety standards, which are really established by Transport Canada," he said.

With a report from CTV's Graham Richardson