Proceedings of the Standing Senate Committee on
Fisheries
Issue 4 - Evidence
OTTAWA, Thursday, February 20, 1997
The Standing Senate Committee on Fisheries met this day at 9:30 a.m. to examine privatization and quota licensing in Canada's fisheries.
Senator Gérald J. Comeau (Chairman) in the Chair.
[English]
The Chairman: This is the first meeting of the committee to examine questions of privatization and quota licensing in Canada's fisheries.
Before we commence hearing from the witnesses, I should like to deal with a matter concerning the Translation Services of the Senate.
With the permission of the committee, I should like to write to the Clerk of the Senate to determine if we could speed up the pace of translation of documents. To give you an example of how late these documents are getting into the system, we still do not have the translation from our October 31, 1996 meeting, which means that we cannot distribute these documents to people who may be interested in knowing what we are doing. That is just an example of the extreme delay that creeps into the system.
Given that the committee has decided to disseminate the evidence we are hearing through our the website, I do not think it is acceptable to have delays of this length. With the permission of the committee, I should like to write to the Clerk about this.
I see heads nodding in the affirmative. Therefore, I shall do this very soon. People are quite interested in the subject we are discussing and I do not think it should take months to get the information to them.
Senator Robertson: Mr. Chairman, what is the average time lag?
The Chairman: It is two to three months. The record of our meeting of October 31 has yet to be translated.
Senator Robertson: That is unacceptable.
The Chairman: We are looking at extremely important subjects and we are still waiting for the evidence of October 31 on the oceans bill. People might be interested in reading what was said at committee. By the time we get it, it will be a nice historical document, but certainly of no interest to people who want to know what we are doing.
We have with us today Mr. Jacque Robichaud from the Department of Fisheries and Oceans.
Mr. Robichaud, please introduce your colleagues and then begin your presentation.
Mr. Jacque Robichaud, Director General, Resource Management Directorate: Appearing with me today are Mr. Leslie Burke, Director of Policy and Economic Analysis (Maritime Region); Bob Huson, Special Advisor to Resource Management; and Mr. John Gilmore, who used to be in Communications and has now joined the Policy Branch.
Many of Canada's commercial fisheries are based in areas where there are few alternative employment opportunities. The management of commercial fisheries often has had to reconcile the economic realities of a modern fishing industry in a global market with other public concerns such as employment and support of established community structures.
Governments at all levels have attempted to use the fishery as a vehicle for economic development. These attempts have been of mixed success and have often led to fisheries which are economically and biologically unsustainable.
Management of Canadian fisheries has evolved considerably over the past 30 years. Up until the late 1960s, there was open access to all commercial fisheries. Since that time, almost all commercial fisheries have been placed under limited entry regimes, limiting the number of licences and controlling vessel size and replacement. Since 1977, when Canada extended its exclusive economic zone to the 200-mile limit, various management schemes have been applied in different fisheries. Predictably, all have relied on limited entry licensing with vessel and gear restrictions to control fishing capacity, in combination with measures such as total allowable catches, escapement targets or recruitment strategies to limit catches and protect the resource. As these measures have proven inadequate, we have introduced progressively more restrictions in the form of input controls to slow the rates for the fish.
For many fisheries, these efforts to legislate inefficiency to conserve the stocks have been futile. Measures such as limitation on vessel length, gear, fishing time and fishing areas have not been effective in limiting harvesting pressure. The fishers are always one step ahead in the race to improve their harvesting effectiveness. In a competitive fishery, there is an ongoing incentive for each fisher to continuously invest in technology and increased capacity in order to out-compete other fishers.
Failure to compete in this ongoing race for the fish means a loss of harvest share and ultimately a loss in income for individual fishers. History has illustrated that in most fisheries the resource base is not increasing but is generally stable or decreasing. Consequently, while increased investment by fishers results in increased overall costs, it does not result in overall increase in production or profits. Rather, over time, profits decline as costs increase.
The outcome of this cycle of increasing investment and efficiency has become quite predictable. The consequences include over capitalization and excessive fishing capacity well beyond the capacity of the resource to sustain. There are threats to conservation as there are no incentives to conserve the resource, as any fish left in the water will be caught by others. There are unnecessarily high costs of fishing as bigger and better vessels are built in order to win the race to the fish. There is excessive regulation as government attempts to implement more control in the field. In turn, fishers seek innovative methods to maintain and increase their efficiency, which necessitates even more regulatory measures. Fishers focus on volume production which results in low quality and market gluts and, ultimately, lower prices. The fishery fails to respond to market needs as the objective is tonnage, not value. There are unsafe fishing practices, as everyone races to the resource. As costs increase, the quantity of fish available for harvest becomes increasingly critical for profitability.
Our experience with traditional fisheries management over this period has validated the theory of the "Tragedy of the Commons", that "race for the fish" management results in excessive fishing capacity and effort.
As a means to address these problems, the Department of Fisheries and Oceans has promoted the development of alternative management regimes for a number of fisheries which have been characterized by the race for the fish. These alternative mechanisms have taken the form of individual quotas, individually transferable quota and enterprise allocations. While each program has specific characteristics, collectively they are commonly referred to as IQ programs.
IQs limit access to the amount of fish a fisher is eligible to harvest and take away the incentive for fishers to invest in the hope of increasing their catch shares. It is intended that the incentive will change from trying to catch the most fish to that of maximizing efficiency and economic returns from a fixed allocation.
While IQ programs are generally viewed as property rights or quasi property rights by fishers, this is an issue which necessitates clarification within the Canadian context. In Canada, a fishing licence issued under the Fisheries Act is a privilege which authorizes the licence holder to participate in the fishery. It is issued at the discretion of the Minister of Fisheries and Oceans and is not a grant of property, either in the fishery or in the fish.
IQs which are conditions of a licence simply provide a fisher with access to a specified quantity of fish. They are an extension of the limited entry licensing system and do not create private rights in fish or fisheries. Individual quotas are not a legal departure from the management of the public fishery.
IQs were first introduced in the Canadian fishery as far back as 1972 on Lake Winnipeg, and even earlier in some small northern fisheries. One of the first major marine fisheries to introduce IQs was the offshore Atlantic ground-fish fishery in 1982.
As requested, we provided a listing of all the current fisheries under IQ, the number of participants and the time it was incorporated. English and French versions of that document are available for distribution.
Our experience has generally demonstrated that IQ regimes have been more effective than previous management approaches in promoting conservation and achieving economic objectives. Since 1990, the Department of Fisheries and Oceans has conducted two comprehensive reviews of current IQ programs which have generally concluded that these programs provide a wide range of benefits to fishery managers and fishers.
These include more orderly harvesting, more stable supply of product to market and improved product quality; enhanced safety for fishers and crew as they are no longer compelled to fish in unsafe circumstances; reduced allocation conflicts between different gear sectors and fleets; improved financial performance as a result of improvement in quality; better satisfaction of market demands and reduction in fishing costs; and longer-term stability for fishers which allows them to plan their future with some degree of certainty. As well, quota transfer can provide a mechanism to support responsible fishing practices in mixed fisheries where incidental catches occur.
In summary, there have been many positive outcomes from the implementation of IQ management in Canadian fisheries. However, IQ management is not without its problems. These include misreporting of catch, discarding at sea and highgrading to maximize value. The term "highgrading" refers to discarding when the intent is to maximize the value of the allowable catch by retaining only the highest value fish of a species. Another problem is labour dislocation and reduced employment as fewer fishers and crew members are required. Of course, if the offshore fleet has reduced by 70 per cent, there are less crew members.
Another problem is quota concentration where IQs are transferable. Fishers often feel that concentration may result in fewer vessels, reduced crew employment opportunities, greater control by processing companies, fewer independent operators, less bargaining power and lower income. As a matter of fact, at a previous committee, Senator Rossiter asked whether there was a process of capping to avoid concentration. The deputy minister wrote in response that in most fisheries there is a process setting forth how much an individual can accumulate or buy back from others.
A further problem is windfall profits to quota holders. This is a major issue in several IQ fisheries where the overall value and profits to licence holders have increased substantially as a result of the introduction of IQ. There are also certain impacts on processing.
Over all, when we look at the approach to IQ and at the two reviews that were conducted since 1990, as well as at the number of participants that have shown interest, there is obviously a keen interest in that approach of managing the fishery. It has proven its benefit. However, we must be realistic. We must always be aware that there are some pitfalls to which we must to be alert and which we must take proper steps to handle.
Senator Stewart: Mr. Robichaud made reference to highgrading. I live in a fishing community and I have heard some pretty horrendous tales about highgrading. Is there any technique that you can use to prevent this practice?
Mr. Robichaud: I mentioned dockside monitoring whereby we verify all the fleets landings. When we perceive that there is highgrading, a fisheries officer does a sampling of the catches. As well, in nearly all fisheries we have a certain percentage of observer coverage. When there is an observer on board at sea, evidently there will not be highgrading. If it is found, when the boat lands, that the entire catch is beautiful, big fish, something is wrong. On 78 occasions, we have closed the fishery and not reopened it until people straightened out their act. That is one approach we have used.
Another approach is the sanctioning process.
Senator Stewart: Before you leave that, I am also told that when these observers go to sea they become very sleepy and require long hours in their bunks. How do you deal with that problem?
Mr. Robichaud: If there is one observer on a boat for 24 hours, I suppose he must have a sleep. However, the gear is not coming up on deck all the time. It is towed for a period of time. I would expect that the observer would pick the right time to sleep.
Any time that kind of thing has been reported, we have taken action. A log must be kept and no entry can be made if a tow was not done. Therefore, there is a way of cross-checking whether the observer was sampling the tow. There are means to verify reports. It is all computerized.
Mr. Leslie Burke, Director, Policy and Economic Analysis (Maritime Region), Department of Fisheries and Oceans:Are you referring to intentional deception or simply when an officer was not on deck when he should have been?
Senator Stewart: I am referring to the former.
Mr. Burke: I saw last night on the news that the head of Mexican drug interdiction was charged with being an accomplice. I guess a uniform does not guarantee integrity on the part of the individual wearing it. Certainly these observers are well trained. They are selected for their competence and they are dismissed if we find that they have, in fact, exhibited some misbehaviour.
Senator Stewart: Do you have statistics on how many you have dismissed?
Mr. Burke: I am sure we do. I do not think the number would be all that large, but we have dismissed some individuals.
Senator Stewart: Reference was made to fleet rationalization. Could you expand on the meaning of that expression?
Mr. Burke: There is a tendency in most fisheries for investment in a fishing fleet with capacity far in excess of the ability of the resource to sustain. The fleet becomes insupportable by the number of fish available. Also, as the size and capacity of the fleet increases, there are increasing restrictions on how long the fleet is allowed to go to sea to catch fish. In some cases, that has been cut back from 200 days to two- to four-day openings, depending on how quickly this capacity grows.
So "rationalization" refers to trying to get a better balance between the size of the fleet and the resources available to support it.
Individual quota approaches are quite powerful in that they allow individuals to make decisions about consolidating quota to support the fishing operation they want to conduct. It is in that context that the term "rationalization" is used. It is allowing individuals to buy and sell quota to balance their fishing business with the fishing power they want to put on the water.
Senator Stewart: Are you saying that fleet rationalization results in consolidation of ownership?
Mr. Burke: One result of having a smaller fleet may be fewer owners. However, individual fishermen often become small businesses. Quite often, for tax reasons or other purposes, they incorporate. They will often run more than one vessel in different fisheries. They are often forced to do that by the different management plans and the timing of the fisheries.
With an individual quota scheme, they are able to plan when they will fish rather than fishing when everyone else does. If there are two openings at the same time, they may have to have two boats to participate. Rationalization happens when individuals are able to divest themselves of some of their fishing power and use a single boat where they previously needed two.
Senator Stewart: You seem to be reasonably satisfied with this approach. Is it an approach which is more applicable to some fisheries than to others? For example, is it more applicable to the ground fishery than to the scallop or lobster fisheries?
Mr. Robichaud: We have discovered through our review that the IQ system is not for all fisheries. For example, in the salmon escapement fishery on the Pacific coast, it would be very difficult. As a matter of fact, at the Pacific round table they studied whether IQ would be applicable. They thought one fleet, because of its pattern of fishing, might be possible in the troll fishery. In the lobster fishery that might not be necessary. Some ground-fish or herring fisheries require a fleet with a certain homogeneity. It must be a type of fishery which has a total allowable catch -- an allocation. Escapement or recruitment fisheries are not necessarily as amenable.
Senator Stewart: Would you expand on the meaning of those terms?
Mr. Robichaud: Escapement is a type of fishery like salmon. You need a certain amount of fish to go up river to lay the eggs, so you allow that amount of fish to escape.
An example of recruitment fishery is the lobster fishery, where you harvest by recruitment instead of having an overall total allowable catch. Let us say you can take 40 per cent of the recruitment.
Senator Stewart: Recruitment meaning?
Mr. Robichaud: Recruitment means the amount of the species which reaches the size which is allowed to be harvested. A percentage of that can be harvested in a given year, with the rest being left to grow and reproduce.
Senator Jessiman: You talked of an individual quota. Is that the same as an individual transferable quota except that it is not transferable?
Mr. Robichaud: That is exactly it.
Senator Jessiman: Are there many that are not transferable?
Mr. Robichaud: I would say most of them.
Mr. Burke: The Canadian approach to putting these programs in place has been to work with a given group of fishermen in a given fishery where an IQ program has some promise. We develop with those fishers the parameters for a program such as this. The most difficult problems usually revolve around the question of how to share the quota. That is a one-time problem faced at beginning of a program. It is a very contentious time, but we work with the fishers to develop an approach which they find equitable. It is sometimes a difficult process.
In addition, fishers typically begin a program by saying that they do not want to have transferability.
They want everyone to have an individual quota which cannot be transferred or apportioned or given to someone else.
Those rules are often introduced at the beginning of a program and some of the programs that we put in place years and years ago continue to have that constraint. In others, as the programs develop, the fishers will decide that they want a certain amount of transferability. Sometimes they want to be able to transfer within the year but, at the end of the year, revert back to the original arrangements.
Senator Jessiman: Are they issued for one year?
Mr. Burke: The licences are renewed annually and there are some legal constraints on how long we can assign a quota. I believe the period is no longer than nine years.
Senator Jessiman: An individual transferable quota also could be for nine years?
Mr. Burke: Yes.
Senator Jessiman: They are transferable, so they could sell them?
Mr. Burke: They could.
Senator Jessiman: Then it is more than just a privilege. Can it be taken away?
Mr. Burke: Yes.
Senator Jessiman: Can it be taken away arbitrarily?
Mr. Burke: For certain reasons.
Senator Jessiman: So it does have some value.
Mr. Burke: Yes, but so did the original licence. The original licence is for ground-fish.
Senator Jessiman: Unless it can be transferred, how does it have value, other than while you use it? Is it given to a company that does not die or is it given to an individual?
Mr. Burke: It could be given to an individual or to a company. Traditionally, even before we had individual quotas or transferable quotas, the licence itself, without quota, was also transferable.
Senator Jessiman: So these are not licences.
Mr. Burke: They are licences with denominated quota on them.
Mr. Robichaud: They are conditional; on the condition of licence.
Senator Jessiman: I read somewhere that 35 per cent of the total landed stock are covered by individual quotas, individual transferable quotas and enterprise allocation. Is that figure correct?
Mr. Robichaud: It is probably higher than that now.
Senator Jessiman: What is the balance? If it is 35 per cent, who covers the 65 per cent?
Mr. Robichaud: The lobster fishery in the Atlantic, for example, is not under an individual quota and there are quite a number of fishermen in that fishery.
Senator Jessiman: Do you issue them only licences?
Mr. Robichaud: Yes, and the number of traps.
Senator Jessiman: Then they are limited in the number of traps?
Mr. Robichaud: Yes, the conditions on the licence include the number of traps and the season.
Senator Stewart: But there is not free access to a licence.
Mr. Burke: That is right. There is not free access. There are limited numbers of licences as well.
Mr. Robichaud: All fisheries have limited entry now.
Senator Jessiman: Not every Canadian can apply for a license?
Mr. Robichaud: No.
Mr. Burke: Ultimately, the value of the quota or the licence -- in this case, the quota licence -- would vary by the underlying value of the fishery. For example, in areas where the lobster fishery, which is not an individual quota fishery, was very lucrative, a licence might trade for $200,000 without quota. That is just the option of fishing in that particular fishery.
Senator Jessiman: When you say "fishery," are you talking about a location?
Mr. Burke: I am talking of a geographical area in that case.
Senator Jessiman: It is not the particular kind of fish?
Mr. Burke: It is the particular kind of fish in a geographical area. It is both.
If you moved up the coast to another lobster district where the fishing is not as good, and where you also need a lobster licence, you could purchase one of those lobster licences for perhaps $15,000 to $20,000, because the returns you could earn from that licence would be a lot lower than in a better district.
Senator Petten: Can a non-fisherman buy a licence?
Mr. Robichaud: In the licensing policy there are criteria that define who can purchase a licence.
Senator Petten: How strict is that?
Mr. Robichaud: It is pretty strict. In order to buy a licence you must have been a full-time fisherman for a certain time, or a crew member or that type of thing. There is quite a process.
Senator Petten: Did this happen on the West Coast with salmon licences? Did people who were not fishermen buy a lot of these licences?
Mr. Robichaud: To my knowledge that did not happen.
Senator Jessiman: I do not see salmon listed on this paper which you have provided to us.
Mr. Robichaud: As I explained earlier, in an escapement fishery you can forecast the quantity of Coho or Chinook, for example, that will be coming up a river. However, the precise time of the run is hard to know, and fish are captured at different locations.
Senator Jessiman: Then how is that fishery managed?
Mr. Robichaud: There are three types of main fleets; seine, troll and gill net.
Senator Jessiman: Are both coasts the same?
Mr. Burke: No. There is no commercial salmon fishing on the East Coast.
Mr. Robichaud: There is only a small amount left.
Senator Jessiman: I eat East Coast salmon and am told that it is so much better than West Coast salmon.
Mr. Robichaud: It is probably from aquaculture.
Mr. Burke: That would be from a farm.
Mr. Robichaud: Each fleet will have an area and a time of opening and closing. That is how it is managed.
Senator Petten: Mr. Robichaud, we knew that highgrading was going on years ago so we started dock-side monitoring. Then we put well-trained observers on the boats. How much have these measures improved the situation?
Mr. Robichaud: Dock-side monitoring was not introduced until the late 1980s. There were some observers at sea at that time, but mainly on the offshore fleet. In the 1990s, there has been a major increase in monitoring and control.
Second, sanctions are now against the licence rather than criminal sanctions. Loss of allocation is a better deterrent than the other type. That approach was introduced in the early 1990s as well.
Finally, the stakeholders themselves have seen the impact of depleted stock.We introduced a conservation harvesting plan which each fleet is responsible to fulfill. It includes various measures on which they must sign in order to open that fishery. The fishers are thereby more involved in developing conservation measures and play a greater role in the industry.
With all of that combined, there is indeed a great improvement from past years.
Senator Robertson: I wish to return to the issue of transferable and non-transferable quotas. Early in your presentation, you spoke about the importance of transferable quotas helping to promote fleet reduction. I gather from previous comments that non-transferable quotas do nothing to assist in fleet reduction. Is that correct?
Mr. Burke: When we introduce even a non-transferable quota, the individuals who are involved in that fishery begin to make a different kind of decision about planning and investing in their fishery. Quite often, they are able, for example, to catch fish at different times of the year, or, if they had several vessels and different fisheries, they may even be able to rationalize within their own little operation without any transfers. Transferability typically means between one operator and another. If an individual or a fishing company had more than one vessel in its operation, it could reduce the number of vessels involved in its various fisheries by having access to individual quotas without transferability.
If they are thinking about investing in their existing vessels or buying new vessels, or converting their operation to something else over time, their financial planning can be done more realistically based on a known amount of fish. Those things all lead to a more right-sized operation.
Transferability gives the most flexibility possible. If there is sufficient capacity to fish the quota, two operators can combine their operations and reduce their fleets in that way.
Senator Robertson: Do we have more non-transferable licences than transferable licenses?
Mr. Burke: At this stage, I would say so.
Senator Robertson: Is it feasible to change that?
Mr. Burke: We have worked with various fleets on a fleet-by-fleet basis to make those decisions. Fishers themselves will strongly influence when or if a program moves from being an individual quota program to an individual transferable program.
Senator Robertson: Can a quota be transferred for just one season? Do you pay for the catch or for the quota?
Mr. Burke: Just as licences without quota have value based upon the success of the fishery, a quota that can be broken down and transferred typically takes on a market value within the fishery. The cost of the quota would depend upon such things as how much it will cost to catch that quota, market value today and forecast market value. The market works invisibly to set a price on quota. Also, if a quota is being purchased for just one season, the price will be considerably lower than if it is being purchased for a multi-year or indefinite period.
Senator Robertson: So it would be helpful on a temporary basis for an individual's fleet adjustment.
Mr. Burke: Fishers do temporary transfers for a number of reasons, one of which is to resolve the highgrading and discarding problem. Quite often, accidental catches are made of species for which a fisher does not have quota, or they catch more than they should have of a certain species for which they do have quota.
The ability to transfer quota between fishers to take care of this catch eliminates the need to discard fish and makes the whole program much more conservationally sound.
Senator Robertson: Do the fish plants have a large number of quotas?
Mr. Burke: As Mr. Robichaud said in his introductory remarks, the individual quota, the individual transferable quota and the enterprise allocation all have basically the same concept.
Senator Robertson: An enterprise allocation is really an enterprise quota.
Mr. Burke: It is a quota that was often given to larger companies that might be vertically integrated, that is, have harvesting operations and processing operations. For most of the people that we are talking about, fishing is a business. We like to say that fishing is more than a business, it is a way of life. However, if it is not a business first, it is not a way of life for very long.
Therefore, when it makes sense to them, fishermen will often engage in some form of processing and some form of marketing. When a fisherman has an opportunity to control all his business decisions, he will be very much inclined to make a contact, perhaps even in an international marketplace, do a minimal amount of processing to his catch and maximize his value by cutting out some middlemen, et cetera. The result is many different industry structures with vertical integration between the harvester, the amount of processing done and the marketing potential.
I suspect that the Internet and the World Wide Web will improve the ability of fishermen to do this. Fishermen are often well equipped with technology and are into the new world in a big way. We will see many different structures in the next little while in how they will run their businesses.
Senator Robertson: Does it follow that the larger you become the more efficient you are?
Mr. Burke: Not always. The small and nimble are often highly profitable operations.
Mr. Robichaud: Too big can be troublesome.
Mr. Burke: I do not think big is a guarantee of either efficiency or success.
Senator Robertson: Has the number of lobster licences changed in the last number of years?
Mr. Burke: Not since approximately 1980.
Senator Robertson: At this table, we have heard repeatedly how stable the Canadian lobster fishery is, that because of our system of licensing we have been good custodians of the lobster. We have heard it said that the Americans have not had the same conservation. They do not limit the number of licences, or did not the last time I heard of it.
Why are we in such a stir about the carapace size? Why are we in such a stir about the lobster in the Northumberland Strait and the Gulf area? They will soon blame it on the bridge to the island or something.
I have been worried about that. I would like to know what is going on. Have we been told the wrong things before?
Mr. Robichaud: In the last five to seven years, lobster landings have achieved peaks never seen before. When it goes up, you never know how high it will go. In the last few years, it has dropped. When it has been high and it drops, there is reason to ask why.
The department asked the Fisheries Resource Conservation Council to conduct an evaluation of the lobster fishery in the east. In their report they suggested that the egg production of lobsters be increased. To do that they suggested what they called a tool kit in which different measures taken would account for an increase at various levels of egg production.
For example, if a fisher found a female lobster with buried eggs in his trap, he can return it to the water. That accounts for a certain percentage of points.
A measure which assists in the number of eggs deposited is the carapace. Of course, there are different views on that in different areas. Some favour a larger carapace. Others which do not, have also done well.
Last year, the department started discussion in the various lobster areas of the measures recommended in the report in order that a consensus could be formed for the adoption of particular conservation approaches. This will continue to be done and hopefully more and more measures will be adopted. For example, in some areas they stopped fishing on Sunday. Many believe that additional research is required and they are investing in that.
There are different views at this time, but the department is continuing discussion with various areas on this tool box to try to get individuals to take additional measures.
You may have read last year about the rectangular escapement which is also supposed to assist in the production of lobster.
Senator Robertson: Are lobster licenses transferable?
Mr. Burke: Yes.
Senator Robertson: With approval from the minister?
Mr. Burke: Yes. In all cases, the minister, through the department, must agree to the transfer. However, that agreement is not withheld as long as the fisher receiving it meets the criteria.
Senator Rossiter: Do they have IQs, ITQs, EAs or anything of that nature in other fishing nations?
Mr. Burke: Yes, they do.
Senator Rossiter: Do they have them in the U.S.?
Mr. Burke: They are the only method used now in all of the New Zealand fisheries and in most of the Icelandic fisheries. They are used to a degree in some of the Scandinavian countries, Norway in particular. Some American fisheries have IQ-type programs. However, like Canada, they are more fishery-specific as opposed to an across-the-board approach.
Senator Rossiter: Apparently the U.S. recently put in place a four-year moratorium on any new ITQs.
Mr. Burke: Yes, they have.
Senator Rossiter: Why is that?
Mr. Burke: This is a very political industry.
Senator Rossiter: Is it because it was an election year?
Mr. Burke: It could be. There are many interests in different parts of the country which come into play on a matter such as this. In fact, there are quite a few misconceptions about the underlying basis of fishing and access to fish. There tends to be a lot of confusion. The notion of having quasi property rights in fish is seen by many Americans as being a communist idea. When you get right to the notion of what is fundamental to the market-based economics that we would use in most democratic countries, if you do not have some kind of property rights, you really do not have a market-based economy. They have actually taken the flip side of this. They are running with the wrong conception of what is more consistent with the economy they would run otherwise.
That is the kind of emotion found in the fishing sector in all cases. In the American political scene there are areas where fishing is very important, such as Alaska. One strong senator can carry the whole scene. All of a sudden there will be a moratorium on an idea that was coming up in his backyard which some of his important players did not want to have move forward. That is what happened in the case of the American moratorium. A senator from Alaska put the brakes on it.
Senator Rossiter: Just in that area?
Mr. Burke: No. It is a federation. As here, if you put the brakes on, you cannot be selective about it. All of a sudden the whole world comes to a screeching halt.
Senator Petten: You said that on landing, if a fisherman has too many fish of one species, he can go to someone else's quota to balance his out.
Mr. Burke: Yes. That can happen.
Senator Petten: How prevalent is this and is it improving?
Mr. Burke: As fishers get experience with these programs, they become more and more sophisticated. Trades and transfers become the normal way to do business. Fishers come from a certain experience and a certain understanding of what success is. As they are presented with a new set of administrative realities, they learn how to best operationalize those and quite often they soon become very sophisticated on how to make the best of that opportunity.
Out-and-out transfers or leases happen. In addition, fishers will team up and use a single boat. They will leave one boat ashore, which is another way of dealing with this problem. Previously, they had to take both boats, at whatever cost, and compete against each other for each fish. They are no longer fighting for the fish. They know that if they cooperate they can leave one boat ashore, because they can catch their entire quota with the capacity of half of one boat. They can make a lot more money by reducing the cost of catching the fish.
Senator Petten: That goes back to my original question. Is it reasonably prevalent now and is it increasing?
Mr. Burke: It is. Fishermen are about the quickest learners in terms of making things work to their advantage.
Senator Petten: I agree with you. My home province is Newfoundland. Along the coast there are so many boats pulled up that it would break your heart. However, those that are in the fishery are very efficient. I just wondered how it is working out.
Senator Rossiter: Are you saying that it is not necessary for every fisher person having a quota or a licence to own a boat?
Mr. Burke: Sure.
Senator Rossiter: So there is no reason why people who do not own a boat cannot own quota and distribute it to other people? We are hearing that on both the West Coast and East Coast some people are buying up quotas.
Mr. Burke: Typically, there is a guild mentality in the fishing industry. I use that in the traditional sense of the word. We have accepted, as a department, that the fishermen have formed a notion about the experience that is necessary before one can participate in a fishery through buying a licence. Anyone could get in. Anyone could work as crew and learn the ropes. Once you have done that long enough, you became a bona fide or eligible fisher person.
Senator Rossiter: A professional fisher?
Mr. Burke: We could say a professional fisher, in quotation marks.
Senator Rossiter: There is no definition of a professional fisher other than that?
Mr. Burke: We used to call them a "full-time" fisher. There were certain criteria to be met. They had to have fished for a certain length of time and have a certain amount of experience. Once they became a full-time fisher, they were eligible to buy another licence or, in this case, to buy a quota licence.
In fact, some of the changes that have been made of late in licensing policy on the East Coast, which applies as well to the quota fisheries, has been this move toward what we now call the core fisher policy, which is another variant of this same idea. To the degree that we accept that in order to be a buyer of quota you must be a core fisher or a professional or full-time fisher, you would not have outside players buying quota.
For the most part, we have left those decisions in a fishery to the nature of the fishery. I will use the example of the offshore clam fishery which has opened up over last few years off Nova Scotia. Because that fishery is deep water and high-tech, the necessary equipment could cost a couple of million dollars. It is not operated in the same way as something more traditional and well-established.
You cannot have the same rules across the board. In established, traditional fisheries, we tend to use the guild idea as the basis for changes. Those decisions are made as they are appropriate, and the decisions change. I am sure that fishers themselves will be suggesting modernization of those rules in the future, just as they recently have. We try to leave all those decisions in their hands as much as possible.
We try to provide a framework within which the most recent thinking can be legitimized, but we allow them a lot of the influence over how that thinking is shaped.
Senator Jessiman: Licences are issued for a particular kind of fish and for a particular area. The number of licences issued is based on the necessity for conservation. The number of fish taken is limited by the number of licences issued so that there will be stock the next year. Is that the idea?
Mr. Burke: Yes.
Senator Jessiman: It should work ideally.
Mr. Robichaud: Ideally, it should, but some 20 fisheries are under moratorium by catch only. Although no new licences have been issued for a long time, the stock has decreased. So the system does not necessarily work.
Mr. Burke: Mr. Robichaud mentioned the side of the equation in which the stock goes down. The other side is what economists call the common property problem.
With technological advancement, the situation has changed. Although we may have perfectly assessed the situation 20 years ago when we said that the stock could support 100 licences, with the state-of-the-art technology today that is no longer the case.
Senator Jessiman: One fisherman alone could take all that fish.
Mr. Burke: The technology is so advanced that it is possible.
Senator Jessiman: What is a fractional licence?
Mr. Robichaud: Fractional licences are used primarily in the west. An example is where two licences are required to fish one boat. They become a combined licence.
Mr. Burke: Let us assume that 20 years ago we decided that 100 licences were perfect for a given fishery. With new technology, the right number is now 50. Traditionally we reissued the same number of licences year after year and people had an implicit, long-term guarantee that that licence would be renewed.
In most fisheries, we do not have a method for combining or reducing those licences. The solution most acceptable to fishermen is that the government buy them out. Each of these licences has a certain value.
Senator Jessiman: So it is more than just a privilege.
Mr. Burke: Technically speaking, it is just a privilege. The minister could cancel all 100 licences tomorrow. However, that would be an incredibly disruptive thing to do to those 100 individuals, so it is not done.
The kindest thing would be to have a buy-back program that would continuously adjust the number of licences in the fishery. However, that is not very fair to taxpayers who are already doing a lot of other things with respect to managing these resources. They are not getting a great return on this public resource, notwithstanding the recent increases in licence fees. It is hardly fair to ask someone in Saskatchewan to pay tax dollars to rationalize this fleet.
The IQ approach or the ITQ approach allows that to happen through transfers between individuals making their own decisions. Another mechanism is the fractional licence. In a given year you may have to use two or, alternatively, you issue them for only half a season. You can divide them in any way that is effective.
Mr. Robichaud: In some cases, although it is unusual, licences have not been re-issued. In ground-fish on the Atlantic, the minister decided not to reissue licences which were not used. So it can and has occurred.
Senator Jessiman: Those licences are effectively cancelled?
Mr. Robichaud: They are gone and will never be issued again.
Senator Jessiman: I have read something about protecting local employment. It suggested that you issue community quotas or processing plant quotas. Do you do that or are you considering doing that? If you do not, is it done anywhere else?
Mr. Burke: These ideas are being advocated in different places. I do not know that any place has actually done it yet in a significant way.
In order to issue a community quota in an area where there is an established fishery, you have to take it away from the fishermen who used to have it and give it to the entire community, which includes the janitor and the school teacher. That changes the way the fishermen make their business decisions.
Our experimentation with community approaches is in its infancy. Groups of fishermen have been coming forward saying they would like a "local community management board" which they would abide by as a group of fishers. In the ground-fish fishery throughout Nova Scotia we are working with that idea. In seven areas fishers have come together and said that they will form a community-based management board. They will set plans that will take into account their impact on each other. They will live within their arrangements and set certain limitations and constraints around how they will operate.
Senator Jessiman: I understand that New Zealand is ahead of everyone in this area. Have they introduced anything like this?
Mr. Burke: Not at the community level.
Senator Jessiman: Has Iceland?
Mr. Burke: Iceland had a community-based constraint on their transfer arrangements. It is like Canada -- a large area with a few small urban areas around the edges. One of their big concerns was that the remote communities would lose all their quota to Reykjavik, the capital, and other areas. Instead of giving community quotas, per se, they used a right of first refusal. If a quota was going to move from a given area, it had to be offered first to people who lived in that area.
Interestingly, they are finding, because of where the fishing grounds are, that the quota is migrating away from Reykjavik. That is an idiosyncrasy of Iceland. The quota is actually moving out rather than in.
The Chairman: We will be talking to people from Iceland about this.
Senator Robertson: Is there a board or group of fishers in each area that recommends to the minister that a transfer of a quota be allowed, or is that done totally by staff advising the minister? Do the local people have any say?
Mr. Burke: The fishermen would have endorsed the rules for the program at the planning level. However, the individual transactions must take place very quickly if they are to be at all effective. They basically decide whether or not transfers will be permitted and then institute an efficient, low-cost way of implementing that choice.
There are not boards which investigate individual transactions and allow or disallow them.
Senator Robertson: Approximately how many transfers of quotas occur every year?
Mr. Burke: In one program alone, it would be thousands. Across the country, it would tens of thousands if not the hundreds of thousands of transactions.
Senator Robertson: With such a massive number of transfers, do fishers in the various communities write to the minister objecting to a particular person receiving a transfer?
Mr. Burke: It can happen. It more often happens when there is some kind of a concentration decision made, such as a plant closing or a company closing. With or without an individual quota program in place, the fact that there were no ground-fish for the last couple of years would have closed all those operations. If the stocks are decreasing or increasing in a fishery, many things will be happening anyway. There is a dynamic element there.
The minister does not receive many specific complaints on actual transactions. Most of the debate is on whether or not transferability will be a design feature of the program rather than on specific transactions.
Mr. Robichaud: For example, with respect to the fisheries in Newfoundland, there were not many individual quotas of that type. However, in the last few years they have moved into the crab fishery, but with no transferability whatsoever. Everything is individual quota only.
Senator Robertson: I was thinking of lobsters.
Mr. Robichaud: It is decided at the beginning, and they put that in their guidelines. This is part of the management plan. It is public. People can see the guidelines for those transfers.
Senator Robertson: There were stories in the press down east about the salmon fishery opening off Newfoundland's coast. Has that happened?
Mr. Robichaud: There has been speculation that this would happen because the moratorium was coming due this year. However, our scientists inform us that you will not see the impact of the progeniture until the coming season or perhaps the next.
Senator Jessiman: Are they recommending that the moratorium be extended?
Mr. Robichaud: The view of our scientists at this time is that we should wait. The minister has not made a final decision, but there will be a decision in the near future with the management plan for Labrador, because there is still a commercial fishery as well as a recreational fishery.
Senator Robertson: Please appeal to him to hold off for a while. It is an important issue, as you know.
Tell us, please, the effect of the imposition of fees for service. We have read a lot in the newspapers and the press about that. Tell us about the changes in employment insurance as well. Those two things, in particular, are affecting the licensing.
I should also like to know whether government subsidies come into play which affect the retention or the sale of licences. I am sure all of those things have some impact on all of this.
Mr. Burke: I will take a theoretical approach to subsidies. Subsidies could be defined as anything transferred into an economy that is not being generated there. Employment insurance payments in excess of the premiums that are collected in a given area could be seen as a subsidy to those who get the payments.
A recent report by Mr. Cashin on the decline of the Atlantic cod fishery indicated that employment insurance is a significant subsidy to fishers in Atlantic Canada. The Cashin report also identifies some ACOA money and some provincial programs aimed at providing assistance to fishers who want to build boat as another form of subsidy to the industry.
There are no direct programs or subsidies that either the federal or the provincial government apply explicitly to the licence per se in either a quota or non-quota fishery. However, there are certainly other programs that one would consider to be subsidies. Any time a subsidy reduces a cost, that gives an advantage to the people who get that benefit over the people who have to pay the cost themselves.
Senator Robertson: If, for instance, my neighbour and I decide to cooperate by fishing together and leaving my boat on shore, there is no program in place to help us do that.
Mr. Burke: No, nor is there any particular benefit or penalty associated with access to things such as employment insurance.
Mr. Robichaud: The only one that comes to mind is the suggestion from the group which reviewed the rationalization program that was established in salmon, and possibly those who have acquired access to another area. There may be a compensation for the effort of accessing.
Mr. Burke: Mr. Robichaud is referring indirectly to a few buy-back programs that we have had. They could be put into this category, although not in a subsidy sense.
On the Atlantic ground-fish fishery, there was an element of the TAG program which focused on buying back licences. Approximately 450 licences were bought back. On the West Coast, we bought back about 30 per cent of the capacity through a government-funded arrangement directed at reducing the number of licence holdings. That was a subsidy to anyone left behind rather than a subsidy to help any individual acquire a licence. The people who paid were citizens and taxpayers. The people who benefited were those who were left at the end of the day and those who were bought out.
Senator Robertson: How did you chose which 450 licences to buy back?
Mr. Robichaud: There was a reverse auction.
Senator Robertson: Is it correct that fees are being imposed on a number of areas in the fishery?
Mr. Burke: Yes.
Senator Robertson: Do any of these fees impact on the licensing process?
Mr. Burke: The main one is the fee charged for access to the fishery. Fees have not changed in the fishery for about 15 years. If you were in a lobster fishery in a very lucrative area where you could earn $200,000, the fee for the licence was $30. If you were in an area where you could earn $10,000, the fee for licence was $30. If you were in a ground-fish fishery where you made no money at all, the fee was still $30.
In looking at raising revenue through a licence fee mechanism, we decided that we must introduce more equity into this process. We decided that we should calibrate the cost of the licence to its potential return. We based the charge on the gross value earnable from a fishery. A significant number were left at $30. However, some off-shore licences now cost $130,000 annually.
Senator Robertson: It is related to the value of the catch.
Mr. Burke: The government gets that.
Senator Jessiman: It is selective, but it seems fair.
Mr. Burke: Companies in very lucrative fisheries with very high revenues can afford higher fees.
The Chairman: I would be interested at some time in the future in discussing the concept of EI being a subsidy and therefore the transfer of money from other areas into the fishery. We could perhaps analyze whether the fishery is getting more of a benefit from EI than, for example, the potato, forestry or tourism industries. That would be a interesting subject, but it is not entirely relevant at this point.
I wish to return to the subject of community quotas and the notion that janitors, doctors and nurses should not be involved in the issue of community quotas. I think you suggested that others than fishermen would not have an interest in the subject.
In fact, would they not have an interest in the future of the fishery in their community? If a decision is made to change the fishery in the community, it does impact the janitor, the doctor and the boat repair people, as well as those who supply fuels and so on. To slough off the community as not relevant is viewing it in a very short-sighted way.
Has there been any attempt to measure the social effects of ITQ, IQs, EAs and so on in the communities?
Mr. Burke: There have been some anthropological studies and certain social studies of IQ programs in Canada and in other countries. There were several done, for example, on the ground-fish ITQ program in southwest Nova Scotia and the Scotia Fundy region.
When you do a social or economic analysis it is very difficult to separate out the IQ effects from the other things going on. The fishery is already a very complicated business. Biology is driving fish stocks in one direction or another. Sometimes, even though there are lots of fish, the markets are poor. The price of fish may have nothing to do with the IQ program or may have a lot to do with the IQ program, depending upon the circumstances.
There may be many other opportunities in the economy at large causing changes to happen. It is very difficult to attribute crime rates or other social indicators to an IQ program. I do not mean to belittle it; I am merely saying that it is difficult to do. It has been looked at in some areas, but it is not a hard science.
The Chairman: As far as I know, there has been no attempt to date to hold a public debate on the concept of ITQs, privatization and resulting problems. There has been no objective public debate on the subject.
Mr. Burke: There has probably not been any public debate, but there have certainly been a great many workshops.
The Chairman: With respect to my first comment, the public includes more than just DFO, the Fisheries Council of Canada, the Canadian Council of Professional Fish Harvesters and a few academics. I am talking about the community itself which is ultimately impacted by decisions made on whether or not to implement ITQs.
Mr. Burke: I spent two days at a herring workshop this week that featured fishers, fish processors and others interested in the management area of fisheries. While ITQs were not on agenda, they were discussed.
To go back to your first point, I did not mean in any way to demean or belittle the concept that other people would be impacted by changes of this sort in society. However, to use an analogy, when a mega-store is to be built in Halifax which will change the retailing characteristics of the communities within 60 miles, we do not often engage in a series of debates and discussions around how that change will take place. I suggest that that would apply equally to changes in agriculture, forestry and most other areas.
The Chairman: I think the jury is still out on who owns the fish. We may have a difference of opinion as to who owns the fish.
Mr. Robichaud: The people of Canada own the fish.
The Chairman: Yes, the people of Canada own the fish. As far as I know, that goes back to the Magna Carta. It is quite different from when someone who owns property outside of Halifax decides to build an ugly steel and wire building that no one wants. It is that person's property and, if the guidelines of the municipality of Halifax allow it, they can do it. With fish, it is quite different. That is why I am attempting to look at the social aspects of the fishery.
I was reading a Canadian Council of Professional Fish Harvesters' discussion paper the other day which said that federal fisheries ministers have repeatedly reaffirmed the importance of maintaining the social base of the fishery. Do you have any reason to believe that this is no longer the case?
Mr. Burke: I think the federal fisheries minister still wants to maintain a sound social base for the fishery. It comes back to whether that is a self-sustaining base or a subsidized base.
The Chairman: Does DFO have at this time a policy on privatization, on the wish to privatize the fishery, or will it let the community decide? In other words, does DFO have an internal policy that it wishes to have ITQs, IQs and EAs in the fisheries of Canada"?
Mr. Robichaud: No. As a matter of fact, we recognize that IQs and ITQs are not for all fisheries. There are many fisheries to which that does not apply.
Each fleet sector or group can choose whether it wants this. We work with them to advance the process. At times, as indicated, it requires a condition of license, which makes it enforcible.
The Chairman: So there is no DFO policy.
Mr. Robichaud: There is no policy that it will be IQ or ITQ right across the fisheries.
The Chairman: An EA has been in place since 1982 or 1983 in the Scotia Fundy region. The ground-fish stocks were split right down the middle. Fifty per cent went to offshore companies -- National Sea and others -- and the other 50 per cent went to what would be called a common fishery, which has subsequently changed. For quite a few years, there was a competitive fishery on one side and an EA on the other side.
Was any attempt made to determine which of the two sectors was the most efficient? It is a living laboratory out there.
Mr. Burke: On the efficiency side, there is no doubt that the quasi-IQ and EA-type approaches are most efficient.
The Chairman: You say there is no doubt.
Mr. Burke: There is no doubt.
The Chairman: Was it in fact studied by DFO?
Mr. Burke: Yes.
The Chairman: It was shown to be more efficient?
Mr. Burke: Many evaluations show that these programs are superior from an efficiency point of view.
The Chairman: Are the findings of these studies done by DFO public?
Mr. Burke: You would not find that in a single study. You would find it in many different comparative studies.
You mentioned ground-fish. As you pointed out, the industry has changed dramatically. The 50-50 condition in 1982 in Nova Scotia and Scotia Fundy would look altogether different now.
The Chairman: Do you have empirical data showing that the offshore EA system is better or more efficient?
Mr. Burke: Gardner Pinfold did a study a few years ago on the efficiency of these programs. We have done other work since then in similar programs.
The Chairman: We would appreciate anything you can provide to us showing the efficiency, whether it has been better for the Canadian taxpayer or worse.
Mr. Burke: Let me define the term "efficiency" for you in the way I was using it. Efficiency would mean that the operators are more profitable, that they have lower costs of fishing and that they have a resource bequest from the Canadian public and are able to do more with it.
The Chairman: If one of the concentrated licence holders suddenly decides to move out of a community, there is a cost to the Canadian taxpayer. These are measurements that I am looking for.
Mr. Burke: I am looking for efficiency measures. You are looking for something else.
The Chairman: If you think that I am looking for the word efficiency, which is the better of the two systems for the Canadian taxpayer?
Mr. Burke: In order to make that determination, you would have to look at all of the other programs, including unemployment insurance. We can extend this to how many young people in coastal communities were not educated because they believed they had an opportunity to stay in their communities and make their livelihood without an education. Now they have not been educated, they have not reached their potential and they cannot contribute constructively to the Canadian economy.
The Chairman: These are very interesting questions.
Mr. Burke: But impossible to answer.
Mr. Robichaud: Mr. Chairman, we could have a view about the program and we could evaluate it. However, what speaks most is the list that was circulated to members. We should look at how many other groups felt that such an approach was better than competing against each another.
The Chairman: I guess that is debatable.
Mr. Robichaud: All the individuals involved should be asked their point of view.
The Chairman: That will definitely be done. We have not made up our minds on anything yet.
I was reading an article from the Atlantic Institute for Market Studies of which you, Mr. Burke, are a co-author. The article is entitled "Behind the Cod Curtain". It compares Atlantic Canada's competitive fishery with the dying days of the Soviet regime.
Is there a policy of the Department of Fisheries and Oceans which allows you to say that UIC is bad or to state which is the better of the two systems?
The foreword to the article states:
...Burke and Brander propose two critical public policy changes. First, they say, the common property problem must be addressed.
They do not say "common property question" but "common property problem". It continues:
The authors' comments here point in the same direction as Elizabeth Brubaker's paper earlier this year for the AIMS Commentary Series on the importance of a regime of robust property rights in the fishery...
On page 9 you say:
What then are the parallels between the Soviet economy and the fishery? The fundamental similarity derives from the fact that common property was the underlying basis of both ownership systems.
In the Soviet Union, many factors worked to weaken the Iron Curtain and undermine the totalitarian state.
There are other comments in the article quite devastating to the common property resource versus the private property resource, which is passed on as being the saviour of the Atlantic fishery.
Are you reflecting the DFO policy here or your own?
Mr. Burke: The disclaimer in the foreword is that these are personal views. I think the department is looking for a healthy discussion on what issues are at play here and what kind of things people should understand about the underlying economics and underlying dynamics associated with the decisions that have to be made.
The Chairman: Has the department issued a counterpoint? Are there others in the Department of Fisheries and Oceans who might have an opinion contrary to yours? Might the department have encouraged such persons to provide a balance to the debate?
Mr. Burke: There is certainly much material from the department which continues to support our earlier discussion of licensing policy and a guild approach. There are many common property fisheries that continue to operate as such where the management plans are endorsed by the department in an official way.
This article first appeared in a Dalhousie journal for which I was asked to prepare an article of this sort. I circulated it to my colleagues in Ottawa and asked whether I was crossing an invisible line.
The Chairman: Were you told that it was fine for you to do this?
Mr. Burke: I was told that a debate of this sort is healthy in a Canadian context and that people should have an understanding of the forces at play.
The Chairman: Your supervisor said it was okay?
Mr. Burke: Yes.
The Chairman: I do not think the minister has taken a side.
Mr. Burke: Nor has my supervisor. The fact that I was told I could publish this does not mean that they agree with me. They just thanked me for letting them know and told me to go ahead if I wanted to engage in this debate.
Senator Jessiman: Is the American position that common property is close to communism?
Mr. Burke: I would say not. There are lots of perceptions that would suggest that that is not the case.
Senator Jessiman: In the United States?
Mr. Burke: Sure.
The Chairman: There are some comments to which people in Atlantic Canada might take exception, for example, that people are living off the products and services of the rest of the country.
Mr. Burke: Many of those conclusions are found in Mr. Cashin's study of the fishery.
The Chairman: However, the case can be made for both sides. Some people in the common resource fishery do go on UI, but people from National Sea also go on UI. That does not get mentioned.
I am trying to put a little balance in this.
Mr. Burke: Sure. That is always a good idea.
Senator Robertson: I think it starts a healthy discussion. The public does not understand enough about these matters. Write some more and get other people to put contradictory positions.
The Chairman: We will probably be looking for any comments from the department that might suggest that the common resource fishery is not necessarily a dying communistic totalitarian regime.
Mr. Burke: This was very much intended to promote thinking about it.
The Chairman: You made me think, sir.
Senator Robertson: Would one you of you ask the appropriate staff member to provide to me a profile of fishery employment? I should like to know what is happening with all these cutbacks in Atlantic Canada, where we were three or five years ago, how many people have been out the door and what is the redistribution of the staffing components in Atlantic Canada. I would find that helpful.
The Chairman: Gentlemen, we very much enjoyed your presentation this morning. We enjoyed the forthright way in which you approached the important question we are studying. We very much appreciate your time and the effort that you put into this, as well as the documents that you circulated to us.
The discussion was so good that the committee might want to talk to you further in the future. I will be discussing that with the steering committee.
Mr. Robichaud: We appreciated the opportunity to appear. If you call us back, we will be back.
The committee adjourned.