Proceedings of the Standing Senate Committee on
Fisheries
Issue 9 - Evidence - May 28, 1998
OTTAWA, Thursday, May 28, 1998
The Standing Senate Committee on Fisheries met this day at 8:30 a.m. to consider the questions of privatization and quota licensing in Canada's fisheries.
Senator Gerald J. Comeau (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, our first witness this morning is Mr. Klaus Sonnenberg from the Eastern Fishermen's Federation.
The Eastern Fishermen's Federation was formed in 1979 to provide a regional voice for a number of individual fishermen's organizations in the Maritimes and Quebec. The federation is an umbrella organization consisting mostly of small vessel owners. I am quite sure Klaus will provide us more information on this as we go along.
Welcome to our committee. I see you have some colleagues with you. I will introduce the members of this committee first and then you might introduce your colleagues. In attendance today are: Senator Robichaud from New Brunswick, who I believe you know; Senator Stewart and Senator Butts from Nova Scotia; and Senator Adams from the Northwest Territories. As well, we have our research assistant Claude Emery and Marie-Danielle Vachon, the clerk of the committee.
Please proceed with any opening comments you may wish to make, and then we will go on to questions.
Ms Melanie Sonnenberg, Executive Coordinator, Eastern Fishermen's Federation: Good morning. With me is Mr. Osborne Burke from North of Smokey, and he is also with the EFF, and Mr. Klaus Sonnenberg from the Grand Manan Fishermen's Association.
I propose to make a brief opening statement, and then I will turn the presentation over to Osborne and Klaus.
Thank you very much for affording us the opportunity to appear before the Senate committee today. The EFF is an umbrella organization that represents over 2,000 fishermen in the Maritimes and Quebec. These fishermen belong to 21 fish harvester organizations from New Brunswick, Nova Scotia, Prince Edward Island and Quebec. The groups are small, independent associations, with varied interests.
In 1996 the federation revised their goals to provide members with information opportunities, and to network through quarterly meetings and special events. The federation's new mandate does not allow us to take positions on local issues. We believe that, with DFO's shift towards co-management, this direction is increasingly important to our membership.
The wide range of issues that face fish harvesters makes the need for the exchange of information essential in successfully managing our resource. Our membership covers a wide range of inshore fisheries and a diversity of gear types. These varying backgrounds provide a wealth of information and views.
In developing this presentation, it became obvious to all of us that we should focus on how ITQs are being dealt with in various areas across the Maritimes and Quebec, from the model-ocean concept that is currently being developed in the Gaspé, to the groundfish buy-outs in the southern gulf, the community management boards of southwest Nova Scotia, and to the multi-licence fishery of southwest New Brunswick. All provide a unique glimpse at ITQs and privatization and its effects on the inshore fishery.
With that opening, I would ask Mr. Osborne Burke to give you a small snapshot into his area.
Mr. Osborne Burke, Director, North of Smokey Fishermen's Association: The North of Smokey Fishermen's Association and the Northwest Multi-Fishermen's Association are one and the same. Our organization represents both fixed and mobile multi-species, multi-licence fishermen in northern Cape Breton. We are unique in that we represent fishers in seven harbours, both in the Scotia-Fundy region and the gulf region. We have been very active on the issue of fleet rationalization.
Our organization is opposed to ITQs as they are currently defined.
I believe that each region is unique and diverse, with varying needs. The current system places control of the resource in the hands of a few and it does not take into account the needs of the coastal communities.
We have been very active in fleet rationalization and considering alternatives to the current system of ITQs. Currently, we are exploring a partnership with seven other organizations in the gulf region of Nova Scotia, and we formed the Gulf of Nova Scotia Fleet Planning Board. This board is comprised of eight organizations with elected representatives representing multi-species, multi-licence fishermen based in the Gulf of Nova Scotia. It represents 75 per cent of the 685 core, bona fide fishers in the gulf region of Nova Scotia.
We have explored many options. One that we are currently looking at in our approach is to reduce harvesting capacity and yet maintain as many fishermen as possible in our coastal communities. We have heard DFO state many times that there are too many fishermen chasing two few fish. Efforts of the original tax program were focused on reducing the number of fishermen as much as possible. However, the government did not listen to the fishermen who clearly stated states that reducing the number of fishermen does not necessarily reduce the harvesting capacity.
Our approach, which is a voluntary one, is to reduce the harvesting capacity. We have come to an historic agreement in the Gulf of Nova Scotia with the nine ITQ vessels which are in the 45- to 65-foot fleet. By voluntary agreement, their licences and their quotas would be purchased through a combination of a post-TAGS licence buy-out program and a no-interest loan to the fisherman.
These individuals would be retired. The quotas purchased would be controlled by the fleet planning board and redistributed to the inshore fleet sector. A fee would be charged, on a per-pound basis, to operate and land this catch or this quota, and the dollars generated would pay the no-interest loan. In addition, any additional revenues would put towards further fleet rationalization efforts that we are currently considering other than those related to groundfish.
Through the process described here, the Gulf of Nova Scotia Fleet Planning Board would hold an ITQ. However, the major difference is it would be held in trust for all inshore fishermen in the Gulf of Nova Scotia. This approach will, in effect, minimize the number of fishermen in our area to, basically, nine, and stabilize the majority, which is in excess of 650, with the most economic benefit going to our coastal communities.
We have already committed approximately $200,000 of industry funds to this initiative. Our proposal has been submitted to both the Minister of Fisheries and Oceans and the Minister of Human Resources Development Canada, as well as various Members of Parliament and other interested parties.
In closing, I would emphasize that there are alternatives to the current system of ITQs. I would remind this committee that each area and region is unique and a "one-size-fits-all" approach cannot be used. We believe we have provided an alternative for our region that will work very effectively. As well, this approach is consistent with the government's approach to reduce the harvest and assure stability for our coastal communities for the future. Thank you.
Mr. Klaus Sonnenberg, Grand Manan Fishermen's Association; and Treasurer, Eastern Fishermen's Federation: I have not had an opportunity to congratulate Senator Robichaud on his appointment, so I would take this opportunity to do just that.
The Grand Manan Fishermen's Association joined the Eastern Fishermen's Federation in 1982. We have been consistent in our efforts to develop a fisheries' policy for the benefit of today's and tomorrow's fishery in southwestern New Brunswick and, more particularly, in Grand Manan. We have had our share of problems. We struggled to gain acceptance within the Scotia-Fundy region as a New Brunswick organization. Nevertheless, during the 1980s and into the early 1990s, we did quite well. We learned how to play the game, and our fishermen developed a multiple-licence based fishery that, in many ways, is a private enterprise in the sense that it is tradable. It is a tradable licence which does not have attached the weight of the catch. Anyone who wants to trade a licence, has to fish it. That is the strength of the inshore fishery. If you have a licence, you must fish it.
One of the problems we have had relates to a grandfathering clause for designated operators which has allowed people to operate more than one vessel. Those kinds of scenarios lead to increased pressures on the fishery and more hands depending on the fishery. The guy in his armchair is taking a cut of the fishery, as is the banker. The Eastern Fishermen's Federation and the Grand Manan Fishermen's Association supports the idea of an owner-operated type of fishery. With the development of limited entry to private quotas, individual quotas that are transferable, the fear is that we will get away from that.
When ITQs or IQs were first discussed in the mobile groundfish fishery -- and, Mr. Chairman, you are very familiar with that discussion -- we agreed with the concept of individual quotas. However, we did not agree with the concept of individual transferable quotas. We felt that quotas that were not large enough or that would not be exercised should be returned to the pool to be redistributed to those people active in the fishery.
That is a different view from the one held by the bureaucrats in DFO. They have supported the idea that people can take whatever IQ there is and make it available for purchase for amalgamation and thereby create an armchair fishery rather than depending on a fishery that is fished by the fisherman himself.
The change we have seen towards privatization has incorporated the people's idea that "you use it or lose it." In the southwestern New Brunswick economy, where we have had a multiple-licence based fishery instead of a single-licence based fishery, we have been especially discriminated against because, as the cycles of individual species and as the season has come and gone, many of our fishermen have partaken in the scallop fishery when it was a lucrative fishery and have decided to bow out of the groundfish fishery for a few years when it was in trouble.
In southwestern New Brunswick, our fishery was in trouble long before we started to develop IQs because our fishery is linked to the American activity in the Gulf of Maine. The result is that, when the day came to allocate quotas based on performance, we were obviously at a major disadvantage.
The meetings we had with Minister Tobin were to try to convince him that the thinking that led to ITQs in the Scotia-Fundy mobile-gear fishery has promoted an increased effort by those people who hold licences in the multiple-gear fishery and, to that end, this use-it-or-lose-it mentality has meant a tremendous increase in the activities of lobster and scallop fishermen in the Bay of Fundy particularly, and in lobsters throughout the entire Atlantic coast, because every fisherman realizes that, sooner or later, there will be an allocation based on past performance. The result is that people who have more than one licence, instead of fishing each one in turn, are fishing all of them, if possible, with different vessels, thereby creating what is called "history" so as not to be discriminated against.
It is our view that, as you develop new systems, you should develop them on the strength of the new system rather than try to mishmash politics and the will of some strong-voiced majority in the process. We liken it to going to college for three years under a certain system. After the third year, the dean of the college changes all the rules and you are unable to graduate in the fourth year because the rules have changed. Since the 1970s, the fishermen in southwestern New Brunswick and many parts of inland Scotia-Fundy, particularly, have developed a career based around the rules. Now the rules are changing. Many of these fishers, with career planning that has taken 10, 20 years, are finding themselves outside the fishery. That is a major problem for the inshore people we represent.
One more item I want to quickly touch on is what happens when you allocate IQs. We have a famous sea urchin fishery. It was developed in Grand Manan for six fishermen. After it became more than a $1-million fishery in a three-month period, in open boats, you can imagine the hullabaloo from other fishermen who wanted to participate. We were able to expand the fishery to 12 licences, with the department adding one more to make it 13. That fishery is now worth $2 million. It is a three-month fishery. As you can well imagine, those people in the fishery and those who represent the fishery, are going to oppose any new entrants in that. We are creating millionaires with Canada's public resource in some situations, to the detriment of areas that are oversubscribed, such as the ground fishery. In fact, we could marry the two, and that would effectively provide a community-based economy by allowing for more free enterprise to take place.
Southwestern New Brunswick has a groundfish community board. It is one of eight in Scotia-Fundy that is presently operating, and it is a typical example of how we can marry privatization, because we privatize a quota for that area. It is not given to individuals; it is given to the community to operate. That community is able to do far more than what would be the case if the quota were given to individuals. One of the best examples is the board in Osborne's area, where they have actually purchased quota to add to their community, thereby increasing the community-based income and the economy-based efforts rather than individual-based property rights.
Clearly, the department, the bureaucrats, are at odds with some of our ideas. We do not believe that they are going down the best road in the interests of the inshore fishery.
The Chairman: Thank you very much Klaus, Melanie, and Osborne. We will now go on to questions. Before I ask Senator Stewart to lead off the questions, Senator Meighen from Toronto and St. Andrews, New Brunswick, walked in just after I had introduced the other members.
We will now go on to Senator Stewart who will open the questions.
Senator Stewart: My first question is addressed to Mr. Burke. If I am correct, Mr. Burke, your North of Smokey group fishes both in Scotia-Fundy, which would be what I would call the Atlantic side of Cape Breton, and in the gulf. Is that correct?
Mr. Burke: Yes, that is correct.
Senator Stewart: Your group is made up of fishers who fish different species, is that correct?
Mr. Burke: That is correct.
Senator Stewart: What are the predominant species?
Mr. Burke: They are multi-licence, multi-species, under 45 feet in the competitive fleet, and they fish a variety.
Senator Stewart: What are they fishing? Halibut? Lobsters?
Mr. Burke: They fish lobster, groundfish, herring, mackerel, crab, a variety of species.
Senator Stewart: You spoke of a fleet planning board. From what Mr. Sonnenberg said just now commending your area, I gather that your ideal is that your group North of Smokey would have a community-based quota. Is that correct?
Mr. Burke: Our organization is one of eight in the gulf region that have come together. It comprises all the organizations representing the majority of the inshore fishermen in the Gulf of Nova Scotia. When we are talking about community, we are talking about from Bay St. Lawrence in northern Cape Breton at the tip of the gulf region, the Scotia-Fundy line, all the way to the Pugwash or Wallace area of Nova Scotia. Our community is actually the entire gulf region of Nova Scotia.
Senator Stewart: I live in the fishing village of Bayfield in Antigonish County, so I know part of the area.
It is multi-species and it covers a fairly large area. You refer to this as a "community" and you talk about a fleet planning board. Will that fleet planning board do the planning of the fleet from the northern tip of Cape Breton around to Pugwash?
Mr. Burke: Yes. We have already held several workshops with the organizations and the fishermen's representatives. We do have a plan. The first stage of our plan is to reallocate the ITQ groundfish quota in the Gulf of Nova Scotia from the nine existing vessels, 45 feet to 65 feet, and reallocate it to the inshore fleet, providing our plan is approved in Ottawa. That plan was the result of a voluntary agreement.
Senator Stewart: How many inshore licence holders are there? I am assuming that it is one licence to one boat.
Mr. Burke: No, there are 685 core or bona fide fishers in the gulf region of Nova Scotia. I would say in excess of 650 of those hold at least three to four licences.
Senator Stewart: You cannot put, let us say, more than one lobster licence on one boat.
Mr. Burke: That is correct.
Senator Stewart: There is an exception to that in case of brothers, I believe. I think your idea is good. Let me do my job and see if there are holes in it.
Suppose I moved into area and said: "It is not a corporation but, by gosh, it looks an awful lot like one. This fleet planning board is a club and they will not let me in which is very unfair. It is undemocratic." How do you respond to that criticism which I am sure you have heard already.
Mr. Burke: No, we have not heard that because we are incorporated. We have a committee structure. We have a mandate. We have fishery development objectives. It is clearly stated in the agreement, which we fully supported and initiated, in partnership with DFO, that any ITQs we purchase must be available to every licensed ground fisherman in the Gulf of Nova Scotia. We fully support that principle. The major difference is it is available to everybody.
Senator Stewart: Would you favour the admission of new fishers by the issuance of new licences in the area?
Mr. Burke: With the current system in the gulf region of Nova Scotia, you can only get another licence if you buy another fisherman out. Basically, there has been no issuance of new licences unless it is for an exploratory fishery.
Senator Stewart: Do you see the problem I am hinting at -- that you really are a closed club by reason of the fact that there are no new licences?
Mr. Burke: No new licences have been issued in the gulf region and, in particular, for groundfish.
Senator Stewart: Are you incorporated under the laws of Nova Scotia?
Mr. Burke: Yes. We have appointed an auditor, an accountant, and a lawyer, and we have the support of the fishermen in the fishermen's organizations. Our board is made up of elected representatives and that election is an open process. As I said earlier, it is very clear that the DFO is a partner in this and everybody must have access to quotas, and our objectives and our goals clearly state that.
Senator Stewart: Would this be an example of co-management?
Mr. Burke: Yes, in a way. Every time we sit down we have arguments back and forth between the inshore and the ITQ or the midshore fleet. With the current quotas, basically, 20 per cent of the fishermen are holding 80 per cent of the quota.
Clearly 20 years of fighting will not solve that problem. We have come up with an approach where, through voluntary agreement, we will buy them out and reallocate that fish to everyone on the inshore in our region who has a licence and is eligible to fish it. We see that as a win-win situation.
Senator Stewart: You talked about the rationalization of the fleet. When I hear the word "rationalization." from experience I interpret it to mean "downsizing." In some industries, it means "increasing unemployment." Is that what is entailed here in the rationalization of the fleet?
Mr. Burke: It is a voluntary program. I am very involved in the sentinel surveys which show a less-than-rosy forecast for the future of the ground fishery in the gulf region for the next five to 10 years. There are fishermen who voluntarily wish to leave. What want to minimize the number who have to leave the fishery. In this current example, nine fishermen voluntarily wished to retire, and those nine fishermen are basically 100 per cent ground fishers in the midshore fleet. By removing nine, we are stabilizing in excess of 650 fishermen. It is all done voluntarily and with dollars invested by the industry.
Senator Stewart: Have you been able to convince that one last holdout?
Mr. Burke: Yes. They are all signed on the agreement.
Senator Stewart: Congratulations.
Mr. Burke: They are ready to move on it. Basically, it is the first time that we have ever had that type of voluntary dialogue back and forth where they are in full agreement. They recognize that they cannot survive in the ground fishery basically with a one-species licence, and they are quite willing to exit the fishery. All that we are doing is ensuring that the quota is redistributed to the majority of the coastal communities.
We do have the support of the inshore fishery.
Senator Stewart: Thank you very much, and good luck.
Senator Butts: Exactly how many fishers does EFF represent?
Ms Sonnenberg: There are 21 member organizations, and in those 21, there are close to 2,000 individual fish harvesters.
Senator Butts: Are there other unions in the areas outside your area? Do you object to me calling it a "union"?
Ms Sonnenberg: The federation is not a union. I must make that very clear. In our geographical area there are unions that operate outside of the federation.
Senator Butts: Why are you not a union?
Ms Sonnenberg: Long before my time, when this organization was set up, it was done with the vision of Roméo LeBlanc. He allowed some funds to become available, and he believed that the true strength of the fishery would be for organizations to get together and work together on matters in the fishery that were important. With those funds, he stimulated the umbrella organization called "the federation." At that time, there was a union under the umbrella but, since then, it has chosen to leave.
Senator Butts: Are you financed by dues?
Ms Sonnenberg: No, we are not. The initial money, the seed money that was given to the federation in 1979, was banked. We live off the interest from that money, plus special projects that we bring in.
Senator Butts: It was money from DFO that got you started.
Ms Sonnenberg: That is correct.
Mr. Sonnenberg: I would like to correct that. The money came from the sale of squid, and that sale provided the monies for the organization. The Government of Canada did not provide the money, but Roméo LeBlanc did make it possible for the sale of the squid to be banked to fund this umbrella.
As you know, there are two schools thought: One is that a fisherman is an employee and thereby conducive to the idea of a union; the other is that a fisherman is a private entrepreneur, a businessman who operates an enterprise. That second concept is more in keeping with the ideas of the federation.
Senator Butts: At one point you said that you had invested $200,000 in your plan, and that prompted me to ask that question.
Mr. Burke: That was from the Gulf of Nova Scotia Fleet Planning Board. We got those funds voluntarily from the fishermen on the temporary snow crab allocations in Area 12 where we had temporary sharing between our inshore organizations. In both 1995 and 1996, we set aside funds to be used to plan for the future of the inshore fishery. That accounts for the $200,000 to which I referred.
Senator Butts: I would like to know more about that plan. You speak a lot about area. What is an "area"?
Mr. Burke: Do you mean in relation to the fishery, like the Gulf region versus the Scotia-Fundy region?
Senator Butts: What is your interpretation of an "area"?
Mr. Burke: With the Gulf of Nova Scotia Fleet Planning Board, our area is a long area from northern Cape Breton all the way up to the Wallace area. When I say "our area." I am referring to the entire length of the Gulf of Nova Scotia coastline.
Senator Butts: It is geographical.
Mr. Burke: Yes.
Senator Butts: Do you have a specific number of fishers in your area?
Mr. Burke: Yes, there are approximately 685 core or bona fide inshore fishermen in that area. Our organization is made up of all the organizations in that area of Gulf of Nova Scotia that represents those fishers. Unfortunately, some fishermen are not members of organizations, but we represent their interests as well. We represent every licensed inshore fisherman, 685 in the Gulf of Nova Scotia region.
Senator Butts: Is there any limit on how many licences one person can hold?
Mr. Burke: If you are talking about individual licences, yes. However, if you are talking about the number of licences, if a fisherman has a lobster licence and a groundfish licence and he wishes to buy a herring licence or whatever, he has to buy it from another core bona fide fisherman. Very few new licences are being issued, so licences are exchanged or bought. Typically, you would hold one of each species. Fishermen then do a little bit of fishing in each area in each species to generate their year's income.
Senator Butts: Could a fisher have one for every species?
Mr. Burke: Yes, if they are available to be purchased from another fisherman, but DFO is currently not issuing one for every specie to every fisherman. The bone fide policy in the gulf has frozen licences for quite a number of years.
Senator Butts: Klaus Sonnenberg talked about IQs. Is an IQ a form of privatization?
Mr. Sonnenberg: Senator, the individual quota can be a temporary, yearly quota attributed to a licence holder. Of course, what is contemplated now is making that determination a permanent determination. It would then become a commodity just as a piece of land is a commodity. An individual quota is transferable. If it is not transferable, it could still be private under different rules.
Senator Butts: Under your rules, do you consider IQs to be a form of privatization?
Mr. Sonnenberg: I do not set the rules. We can only hope that they will develop along the lines that will protect the inshore fishery. Presently, the thinking is that, under the rules, an individual quota would be attributed to a specific person, or a company, that can then trade it like one can an automobile. That is the kind of rule that we do not support. We support the idea that this determination of privatization be limited to a community which is perhaps geographically based. That is not to say that the fishery is limited to those boundaries, but the participation within the community is finite. Then the determination of how the fishery proceeds would be developed according to the wishes of the community, in much the same way as Mr. Burke has described his fleet planning situation.
Senator Butts: If an IQ is retired, the amount of that IQ is redistributed. By whom is it redistributed?
Mr. Sonnenberg: Presently, individual transferable quotas in the mobile-gear groundfish fishery are distributed amongst individuals, amongst companies. The present structure is contrary to the interests of the inshore fishery because the financial magnitude of purchasing out individual quotas is so great that the opportunity is not available to individual fishermen. Only multi-national companies have that opportunity.
Senator Robichaud: I want to thank you for taking the time to assist us. I congratulate you on all the work you have done with the various associations and for the cooperation you have offered to the DFO.
I would like to touch on the subject of exploratory fisheries. I believe we have a lot of work to do in that regard. You mentioned the sea urchin fishery which proved to be quite lucrative.
There is a member organization of EFF, the Botsfords Fishermen's Association in southeast New Brunswick, which last year fished the rock crab. That turned out to be quite a lucrative business. Last year they received a community quota which they divided amongst their fishermen. That was a very good idea. This year DFO is considering making the exploratory licences permanent and, as well, distributing a small quota to other fishermen. They are doing what you mentioned, that is, they are creating millionaires of those who fish the rock crab. I do not think they will be millionaires, but they will make a good buck. Would you address the issue of the sea urchin? This seems to be going in the same direction.
Mr. Sonnenberg: Senator, the sea urchin has gone that entire route. It was not a licensed fishery. It was exploratory up until a year ago. Then it became limited entry, where we went from six licences to 13 licences. They have an individual quota. It is not transferable, and yet those who hold the licences are able to have other people fish the sea urchins for them. In effect, you have the armchair owner sitting at home taking his cut off the top. I believe this is contrary to the best interests of the Canadian fishery.
In this particular case, we have almost reached a $2-million fishery amongst 13 licence holders, and that in a three-month fishery. Obviously, using this as an example of a fully IQ fishery, there has to be some provision in place after people start to make quite a comfortable living in that three-month period. After the three months, they hop into the lobster or scallop or herring fisheries. There has to be some mechanism so that, as you have put it, they do not become millionaires from the fishery when, at the same time, their compatriots fishing in the groundfish fishery in southwest New Brunswick struggle to make payments on their vessels over the same period.
We are under tremendous pressure to increase the number of licences in that particular fishery. At the same time, there will be tremendous pressure exerted by the proponents of the fishery, the licence holders, not to do that. In fact, I believe the Department of Fisheries has signed a co-management agreement with these 13 licence holders saying that no more licences can be added. The bureaucrats are faced with the biggest stumbling block in the kind of community-based fish planning procedures that we are into. The biggest obstacle too often is the bureaucrats who have very closed minds and believe that it is much simpler not to issue any more licences in that fishery. We are saying that they should give the fishery to the community and let them determine the ongoing procedures.
The example of bringing in offshore or mobile-gear fishers into a southwestern management board of groundfish fishermen, such as Mr. Burke has done, is the kind of thing that we have always supported. We have always said that we have a choice. We can put 100 tonnes of fish on one vessel, which is a very large ship, and very expensive to operate. It is owned by one licence holder, one company in most cases, and everyone else is an employee of that company. That is a choice. Canada has that choice. The alternative is to give the 100 tonnes and give it to a fleet planning board or the Southwestern New Brunswick Groundfish Management Board. It is one of eight from Halifax through to St. Andrews. That amount of fish can be redistributed to 20, 30, or 40 boats which are individually owned and operated. In this way, you allow Canada to support the concept of an inshore fishery that is not based on a single vessel. It supports the marine service industry. Is supports accountants, lawyers. It supports the oil industry. It supports everyone along the way. They are not just "employees." they are managers of an enterprise that has its strength in not one licence holder but 100 different licence holders.
As a member of the Eastern Fishermen's Federation addressing the problem of privatization, I think it is wrong for Canada to put its resource in the hands of individual, large corporations that then treat the public of Canada as employees.
Senator Robichaud: I agree with much of what you are saying. I do not agree with concentrating the resource in a few hands. We have a lot of work to do, and you as an association and the other fishermen's associations have a lot of work to do to convince some of the powers that be that there is another way of doing it.
Exploratory licences are issued to people who are willing to pay certain expenses and take some chances. Those who go into this kind of fishery do so with a hope -- and sometimes some indications -- if it proves to be a good fishery, that they will be issued a permanent licence. This builds from year to year, like the sea urchin or like the rock crab in my area. If it is then made permanent, the fishers who hold the licences do not want anybody else to be licensed. If I were in their shoes, I would think the very same way, I suppose, because it is lucrative.
Perhaps those exploratory licences should be given to groups of fishermen rather than individuals. Would that be possible?
Mr. Sonnenberg: It is possible, and it has been proposed, but the present system is not that bad in the sense that we allow them the opportunity to stay in the fishery after it becomes lucrative. I do not think any one of the sea urchin fishermen ever thought that the investment they were making would be repaid by the kind of repayment they are now getting. We are not advocating that they be removed from the fishery. We would point out, however, that when you give the fishery to individuals, then you run the risk of giving Canada's historic wealth to individuals rather than to communities.
The fishery is a very fluid enterprise. Today the sea urchin fishery is worth something; but tomorrow it may be worthless. We need mechanisms to accommodate those changes in our economy. Individuals cannot accommodate those changes in the economy, and that is the danger of privatizing it in the hands of individuals. The same comments apply whether we are referring to the developing fisheries or the established fisheries.
Senator Meighen: Perhaps being from St. Andrews which is on the border, I could ask you a question about the interaction between the Americans and ourselves. There is a moratorium, as I understand it, on ITQs in the U.S. for another few years. In Canada, rightly or wrongly, ITQs seem to be the way the department wants to proceed, at least in some areas. Would you favour a moratorium in Canada on ITQs at this point?
Mr. Sonnenberg: We would favour a step back to see if the rush towards ITQs is creating an undue increase in effort in the fisheries that have yet to be turned over to IQs. What we are finding, for example, in the lobster fishery, is that, too often, people are fishing increasingly harder simply because, if it is turned into an IQ fishery, they want to make sure that their history is such that they will become millionaires in the future by the present use-it-or-lose-it policy that Minister Tobin condemned. The press release of April 27, 1994 clearly indicated that he wanted the department to build the strengths on a multiple species enterprise.
The fact is that, with the example in Nova Scotia of mobile-gear fishery, everyone who did not have a history was forced out of the fishery, including the pioneers of the mobile fishery. Grand Manan fishermen pioneered fishing on Georges Bank but, today, not one mobile-gear fisherman from New Brunswick is able to fish Georges Bank simply because, in that period of time, they were not there.
Senator Meighen: Why were not there?
Mr. Sonnenberg: They were not there because the fish were not there.
Senator Meighen: That is a good reason.
Mr. Sonnenberg: The people who had the history on Georges Bank during those years actually fished off Whitehead in the Bay of Fundy, off Grand Manan. They claimed that the fish that they caught were coming from Georges Bank. Off of Whitehead was known as Little Georges because that is where the fish came from.
Senator Meighen: From the testimony we have heard both from the West Coast and the East Coast, if something good can be said about ITQs, it seems to reside in the fact that they have to be selectively applied dependent upon the individual fishery, geography, and particular circumstances. Would you agree with that sort of over-generalization?
Mr. Sonnenberg: I think that is the principle of the Eastern Fishermen's Federation. You have heard today from two quite different associations. Our association operates quite independently within the umbrella structure of the Eastern Fishermen's Federation. Our role as a federation is to provide a parliamentary opportunity for the individual organizations. It allows us to discuss differing views among our groups, some of which have leanings towards individual appropriations.
Senator Meighen: Perhaps to Mr. Burke the idea of community allocation seems very attractive. Is there any difficulty in defining community? Does "community" mean those who are part of an association or those who live in that area? For example, yesterday a West Coast fisher told us that she lived in an area other than the region in which she fished and, yet, she was part of the regional association.
Mr. Burke: In the particular circumstances of our fleet planning board, it includes fishermen who live in those coastal communities and fish out of those harbours and bring the dollars back to that particular community. Our board is open to representations from any one of those fishermen or organizations that currently exist in that area. They may all sit on the board and we have never turned anyone away who has a stake or interest in it. It is an open process. We have consulted and we have come up with our plan.
Senator Stewart asked about opportunities for new people in the fishery. One of our guiding principles is that fleet planning must not prevent the opportunity for new entry into the inshore fishery. Senator Butts asked about retirement ITQs. We are looking at redistributing those who have groundfish licences in the gulf region of Nova Scotia. When we talk about "community." we are referring to everyone in that region who directly benefits. We want fish quotas redistributed to those coastal communities and so that everyone will receive the benefits of them, whether it is the plant worker, the processor, the dock worker, the truck driver, or the local grocery store owner.
Senator Meighen: Any quota system is presumably based upon stock assessments. I have heard that, traditionally, fishermen do not believe that the bureaucrats have a clue or that the estimates have not been very accurate. Is that still a current view, or are estimates pretty good now?
Mr. Burke: We have been quite active in the sentinel surveys of fisheries in the Gulf of Nova Scotia. Prior to the reduction requests by ministers such as Mr. Crosby in the past, it was the inshore fishermen who could see that there were problems with the fishery and who were asking that something be done about it. The fishermen are quite aware of current assessments of the stock.
There are major increases along the west coast of Cape Breton and PEI . In areas such as in the Gaspé and New Brunswick, and the other parts of the gulf region for example, they could not catch enough fish in the entire sentinel survey to pay their fuel. It varies from area to area.
The quotas we are considering purchasing are already established, and they are based on the 1991 total allowable catch. For example, if we purchased it and we were to fish it in 1998, it would be severely reduced. However, as the stocks come back, the quotas will increase.
Mr. Sonnenberg: In the Bay of Fundy we have a 4X quota, but that has gone too far the other way. If they gave us a quota of 100 tonnes for all of 4X, the fact that the fish are not in the eastern end of 4X. There has been a shift in effort, and we have had a doubling of effort in the Bay of Fundy which is part of 4X, so rather than supporting a portion of the 100-tonne quota, that particular area is supporting almost all of that quota.
The compartmentalization of quotas goes too far because the effort that it takes to arrive at that amount of quota must be taken into account, and that is why many of us support the fixed-gear fishery which catches into a net for, say, half an hour if the fish are scarce, and they can come up with the 100 tonnes.
The Chairman: I thank the witnesses for assisting us morning.
Our next witness is Mr. Michael O'Connor. In the mid-1980s, a restructuring process amalgamated a number of processing firms operating offshore trawler fleets. Two large, vertically integrated industry companies emerged, one based in Newfoundland, Fisheries Products International, and the other one in Nova Scotia, National Sea Products Limited. National Sea is a publicly traded Canadian company which processes and markets fish and seafood under the Highliner brand in North America, the Fisher Boy brand in the United States and Mexico, and the Booth brand in the United States. The company's common shares trade on the Montreal and Toronto stock exchanges. Please proceed.
Mr. Michael O'Connor, Fleet Operations and Government Relations Manager, National Sea Products: Thank you for this opportunity to appear before your committee.
Property rights have been embraced in some fisheries in Canada since 1982, and they are becoming more acceptable world-wide including in some inshore fisheries. For instance, in 1998, Newfoundland fishermen in Placentia Bay have taken a first step and agreed to an IQ system for 3PS cod. The announcement was made this morning with respect to that stock.
The need for an orderly managed fishery was clear to them after the disappointing fishery in 1997 which resulted in a race for the fish and landings of poor quality. This year, if they fish later in the season, some processors will produce better yields and pay premium prices for inshore cod. Fishermen who want to take advantage of fishing later will also harvest fewer fish to obtain the same quota weight, compared to those fishermen driven to compete by catching fish just after spawning when weights and quality are lower.
With Canadian-made property rights and regime-like enterprise allocations, our company was able to establish year-round markets for a variety of seafood products. We changed our fishing patterns to reflect market demand rather than race for fish to beat our competitors to the grounds. Our company orientation changed from being volume to market driven. The enterprise allocations allowed us to plan more effectively and concentrate on quality and product form. Our fleet operations and structures changed, strategies were adapted to improve the mix and efficiency of our vessels by retiring fishing capacity and maintaining good incomes for the remaining trawler men. Quality-based investments were made in the remaining fleet, modifying fishing practices and introducing a quality-based price and system. Our plant processing operation and structures also changed. Fillet and block inventories declined and groundfish production in terms of hours-per-tonne increased as more value-added products were made. The above describes some of the changes that occurred at National Sea Products during the mid-1980s relative to our previous competitive load in fisheries.
There was also a learning curve in fishing practices. With enterprise allocations came high-grading and discarding. The latter was made easy with government regulations that permitted culling at sea. It took several years to change the habits of fishermen and develop monitoring systems to ensure these practices were stopped. Since then, we have introduced a company groundfish compliance program including pre- and post-vessel inspections of gear, at-sea monitoring with black boxes, at-sea observers, developmental electronic log books and video cameras, daily reporting of catches and fish size, a land-it-all policy, dockside monitoring by third parties, and employment conditions for our fleet management.
The purpose of these measures is to avoid area misreporting, dumping and discarding. This ensures company allocation limits are not exceeded and avoids allocation sanctions and/or fines. We believe these measures will plug the essential hole in any quota management-based system, that is: How much fish was harvested?
In 1998, we are operating two plants in Atlantic Canada, five offshore trawlers, and several independent vessels. Since 1992, we have sold off a large number of our vessels. We would not have sold as many if the remaining and future fisheries had been more competitive.
We should make a distinction between true property rights and our enterprise allocation regime for the following reasons: First, our enterprise allocations are only harvesting rights. Other biological management measures including seasonal closures, total allowable catches, gear restrictions, and small fish protocols, limit the extent of these rights. We do not have rights to fish stocks in their natural habitat.
Second, permanent transferability of enterprise allocations are subject to ministerial approval. We know intra-regional transfers of allocations would be discussed with provinces before any decision would be or could be made.
Lastly, the Minister of Fisheries and Oceans has discretionary licensing powers and can revoke or change our licence conditions. The latter point creates uncertainty about yearly sector shares and quotas and can destabilize investment plans, markets and production plans. We are currently working with the government to develop long-term partnership agreements where our respective roles in fisheries can be clearly understood.
In return for security of access to our shares of the resource, we are prepared to take on more fisheries management activities such as conducting ongoing science surveys, providing port sampling, data gathering and at-sea monitoring. We are already conducting several science surveys under an association of the offshore companies called the Groundfish Enterprise Allocation Council and are providing a 100-per-cent dockside monitoring of all landings and port sampling in some offshore plants.
The underlying principles in these agreements is that ownership, with as few strings as possible, will empower fishermen and vessel owners to be more accountable for resource management. By enhancing stability, owners will have more time to find valuable use for the resource.
Enterprise allocation and ITQs provide a number of incentives to use resources efficiently. Confident their harvesting rights to fish are secure, fishermen and vessel owners need not waste money building larger vessels and equipping them with more advanced gear in a race to catch fish. The permanent transferability of quotas allows existing excess effort to be retired in a way that can satisfy both those who quit and those who remain in the fishery.
Enterprise allocations and ITQs also promote orderly and informed fisheries management. With valuable assets tied up in their property rights to a percentage of the catch, fishermen and vessel owners have an economic interest in ensuring fish stocks are managed properly. There is also the conservation of resources employed to harvest allocations -- less fuel, fishing gear, steel, machinery <#0107> resources which are being wasted by maintaining surplus harvesting capacity for competitive-style fisheries.
The ITQ fisheries for Pacific sable fish and the halibut have also demonstrated that ITQs can save lives. Safety records of those fisheries have improved dramatically as compared to the derby-style fishing of the past.
Embarking on a property rights regime is not easy. Fishermen must be ready to accept an alternative way of management for the fisheries, sharing formulas need to be negotiated, and there will be initial changes in the number of fishermen and vessels as the market develops for ITQs. Based on the combined experience from Canada and other countries with property rights, there is a good body of information on which to assess the merits of this system.
Senator Stewart: We have heard a fair amount of evidence opposed to individual transferable quotas. I believe it is accurate to say that much of this has come from the inshore fishing sector. That leads me to ask you where your plants are located. I believe you said you had five offshore ships and then you mentioned several other ships from which you were buying fish. Where do your five offshore ships fish, and what other sources of fish do you have for your Nova Scotia plants?
Mr. O'Connor: We have two plants in operation, one in Lunenburg, Nova Scotia, and the other in Arnold's Cove, Newfoundland.
The five vessels that are active are fishing primarily for perch, cod and pollock. Yellowtail will open in August; and we will probably fish some turbot off the northeast coast of Newfoundland.
The independent vessels we are using are based out of southwest Nova. They are operating under a special program, the Temporary Vessel Replacement Program, and they are principally fishing for pollock.
Senator Stewart: Are any of your ships or these other vessels competing with inshore fishermen in inshore waters?
Mr. O'Connor: Any offshore vessel has a licence restriction on fishing outside 12 miles. Sometimes we get caught up in the offshore with the smaller ITQ vessels that also can fish inside 12 miles. You might run into more animosity with fix-gear fishermen in the Bay of Fundy and small mobile-gear vessels. We are not allowed to fish inside 12 miles or inside the Bay of Fundy.
Senator Stewart: You have come out against competition. If I were to win a substantial amount of money in the lottery and decided to start up a major fish operation, would you argue that that was inappropriate?
Mr. O'Connor: What I argue against is competitive fisheries that result in a creation of surplus capacity and the build-up of frustrated fishing capacity which results in taking more fish than should be taken. That is what I am concerned about.
Senator Stewart: In private enterprise the rule of the market is that people can open up small retail outlets, restaurants and so on. However you do not want that; you want a semi-socialized fishery.
Mr. O'Connor: I did not think I was arguing for a semi-socialized fishery.
Senator Stewart: I am putting the label on it. Why is the label inaccurate?
Mr. O'Connor: The label is inaccurate because the example is not a fair one. The example might be better if it related to a resource-based industry such as lumber or any other renewable resource. Because they are limited resources, those industries require some protection. Therefore, you need a management regime, you need regulation, and you need some form of control.
Senator Butts: You have one processing plant currently operating in Nova Scotia. How many plants do you have there that are closed down?
Mr. O'Connor: In Nova Scotia we have one plant that is closed down, our Louisburg plant, and that is currently leased to Han Beek Seafoods which processes silver hake and other under-utilized species.
Senator Butts: You own the plant and that company is paying rent; is that correct?
Mr. O'Connor: Correct.
Senator Butts: How much offshore processing do you do on ships? Do you also do some processing in other nations?
Mr. O'Connor: We do no processing on board ships, but we do process fish in our Portsmouth operation in the United States.
Senator Butts: Is the monitoring on board or on the dock done by your employees?
Mr. O'Connor: No. The observers are third party observers authorized by the Department of Fisheries and Oceans. The dockside monitors are also third party dockside monitors authorized by the Department of Fisheries and Oceans. The other monitoring activity that we pursued is the video camera system, which is totally passive, but it also changes behaviour at sea.
Senator Butts: You mentioned that DFO has the authority to revoke or to change licences. Has that ever happened?
Mr. O'Connor: The Minister of Fisheries and Oceans has the discretionary power to revoke and change licences. The revoking of licences has not happened to my knowledge in the offshore fishery, although it has happened in some inshore fisheries. However, the changing of conditions happens quite often.
Senator Butts: I now understand your economic policies with regard to your corporation. What social policies do you have insofar as you have a commitment to workers, to plants, or to communities?
Mr. O'Connor: We recently received the Literacy Award for the largest company in Nova Scotia. In fact, it was granted on a Canada-wide basis. There is a strong social commitment in the company to our employees, and that has been demonstrated by our ability to at least keep two of the plants operating.
Senator Robichaud: Those who do not agree with ITQs and EAs say that they are the means by which major companies such as National Sea get their hands on the bigger part of the quota, and hang on to it, and that this leads to the creation of corporations which control a large part of the resource which, in turn, leads to armchair fishermen selling their quotas to get whatever rent they can. Would you care to comment on my statement?
Mr. O'Connor: We are not in the business of encouraging the armchair fisherman. That is probably more prevalent in some inshore fisheries. It might be more closely related to lobster fishing where you have successful lobster fishermen who are not under an ITQ system, and who do not operate their boat but rent them to others. I do not think it is exclusive to ITQs in the inshore area or exclusive to any one fishery.
National Sea Products has not absorbed any other companies within the offshore to increase our enterprise allocations. We have held onto our allocations because they are important to us. They are a key component to our survival in Atlantic Canada, and without them, we will not survive.
Within the offshore, where we have had enterprise allocations since 1982, we have not had a concentration of allocations in one company or another. When we started, we were looking at something in the order of 20 companies. We went down to about 14 players and we stayed at that figure since about 1984. There has not been much concentration within the offshore enterprise allocation regime, and the offshore shares would, in fact, have diminished in size since 1984, with the greater share going to some other sectors.
Senator Meighen: What percentage of your supply comes from Canadian waters and what percentage comes from somewhere else?
Mr. O'Connor: In 1997, about 15 per cent came from the vessels that we operate and about 85 per cent came from other sources. The other sources would be the Bering Sea and the Barents Sea.
In 1992, when resources took a dive in Atlantic Canada, we were fortunate to be able to get into an H and G type of operation in our plants.
Senator Meighen: What is an H and G?
Mr. O'Connor: Frozen headed and gutted fish. The plants became very specialized at dealing with value added processed fish to the extent that the head and guts were removed and it was frozen, so they could take out just enough and process it and produce innovative products with it. It actually made the company more profitable. This is what we consider to be a changing supply. In 1998 we are faced with a significant reduction in world supply of groundfish from the Bering Sea.
Senator Meighen: Am I correct that all the fish you catch are processed in the two plants in Canada or the one in Portsmouth?
Mr. O'Connor: All the fish we catch are processed almost exclusively in Lunenburg. From time to time some is processed in Arnold's Cove. None of the fish that we catch is processed in the U.S.
Senator Meighen: Are the fish that are processed in the U.S. caught for somebody else on your account?
Mr. O'Connor: The fish processed in the U.S. is largely Alaska pollock and mullet. That would come from fresh water lakes such as like Lake Winnipeg. It would also come from the Bering Sea.
Senator Meighen: I have just named you the omnipotent Minister of Fisheries and Oceans. You can do anything you want. What law or laws would you deem most important to be passed today? You have only one day to exercise this power; and you do not have to deal with the Senate.
Mr. O'Connor: That is not a fair question. I do not think a single law will solve the problems.
Senator Meighen: What are the main issues that bother you?
Mr. O'Connor: The biggest single issue we are faced with today is raw material supply.
Senator Meighen: It would be difficult to pass a law which would increase the number of groundfish overnight.
Mr. O'Connor: I would try to make the provincial governments involvement in the fishery a little more transparent.
Senator Meighen: Can you elaborate on what you mean by "transparent"?
Mr. O'Connor: Provincial economic interests tend to create pressures the on federal government to do things that they might not otherwise do such as developments to maintain plants. Since we are dealing with the possible, let's pick a plant somewhere in Nova Scotia where we know there is no supply of fish, but the community does not want to let it go. They go to the local MLAs and local MPs and say, "You must do something for us." There is a possibility that there is a resource adjacent to the plant, but it is questionable whether that resource should be developed because there may be some major conservation issues, but the employment priorities are so significant that the provincial government must pursue this. Therefore, they put as much pressure as they can on the federal government and on the different agencies that the federal government has to make money available to keep these plants alive without looking at the long-term impact.
The fishery is dysfunctional because there are so many different inputs to the minister. We have put a significant amount of power in the hands of one man, in fact, far too much to expect one human being to be able to make decisions. We have a huge bureaucracy which acts as a buffer, to give and take, but we expect one man to make those decisions. We are probably asking too much from the structures that exist.
Property rights tend to institutionalize certain aspects of the fishery and eliminate many of the constant pressures. To our company, it seems to be a logical approach.
The Chairman: In the absence of national policy, public policy discussion or public policy on private quotas, DFO tends to tackle the question of ITQs and so on one sector at a time, one fishery at a time, or one region at a time, somewhat the way the prime minister tackles problems, one problem at a time. However, in the fishery this creates pressure on users or licensees to continue catching fish in order to maintain the history. Their history must be good for the day when DFO will come around and privatize or create ITQs respecting any part of the fishery. This creates all kinds of pressure on every one of those fisheries. It does create quota and stock problems. This is all in the absence of public discussion or policy. How do you respond to people who raise this as one of the legitimate concerns of the fishing industry -- that there be a public policy discussion prior to any further privatization of the stocks?
Mr. O'Connor: About three years ago there was a public policy discussion in Montreal which was attended by representatives from every area of our Atlantic coast. The main discussion centred around property rights. One of the conclusions of the group was that, unless two-thirds of the fishermen in an area agreed to the introduction of the property rights regime, no such regime should be put in place.
The example that I used at the start of my presentation about 3PS cod was based on interest from two-thirds of the fishermen in Placentia Bay. There is a policy which has, at least, been accepted by some.
The Chairman: I referred to "public policy." That not only includes fishermen, it also includes hairdressers, taxi drivers, insurance people, doctors, and those who live in communities. I am referring to the public. I am interested to hear that you had a meeting in Montreal of representatives of fisheries groups. However, I am referring to a public discussion and whether the public accepts this whole concept of privatization. Should this be continuing in the absence of a public policy?
Mr. O'Connor: It would depend on to what extent the public can participate in such a debate. There is a lot of material out there. I suppose they could. You seem to be trying to lead me towards a discussion on community quotas and what we do with communities because a company or a fisherman who has ITQs decides to sell his ITQ to another fishermen who happens to reside in another community. That is what you are getting at.
Communities do have an impact. National Sea Products, our Lunenburg plant alone, contributes 10 per cent of the entire electrical bill to the County of Lunenburg, so obviously what happens in Lunenburg with respect to our productivity will impact all the taxpayers, all the rate payers in the community of Lunenburg. There is no question on that.
Our approach is basically to have strong, sound, sustainable enterprises within each community and that will look after the communities. I am not sure that you can approach it from the outside and have this public debate and bring all these different points of view to the table. I am not sure whether you would be any further ahead. To have strong, sustainable communities you must have viable enterprises, and that is the system which we live with.
The Chairman: Eight or nine years ago, you closed the Louisburg plant. The fish that used to be landed in Louisburg are now landed in Lunenburg. If that community had depended on a smaller boat fishery, on a greater number of vessels rather than one or two, would the remaining fish not have been landed at Louisburg rather than being landed at Lunenburg?
Mr. O'Connor: I understand where you are coming from. I can give you more correct facts. Forty 40 per cent of the fish that went to Louisburg was northern cod. Louisburg was a northern cod plant. That is why we invested in the plant, and we were encouraged to invest in the plant.
The rest of the fish that came from Louisburg was for 4Vsw cod which has been closed since 1992. The plant has been closed since 1993. The fish we are fishing today is made up of 45 per cent pollock with the remainder being perch. We have always been committed to perch in Lunenburg and that community has benefited from the perch. The only areas we may fish pollock tend to be 4X and Georges, when it is open. We have a major problem with respect to where we can fish pollock, a stock that is relatively stable. There is a lot of resistance within the bureaucracy to allow us to fish in other areas, even though we can demonstrate that we can fish it with mid-water, 100 per cent, observer coverage. However, there is a political perception that National Sea Products is fishing, so the question is asked: Why should the fishermen not fish too? That comes from some of the other sectors. We live with that. That is what is happening in Lunenburg.
That is not to say that, if Han Beek Seafoods decides to make Louisburg a going concern and fisheries were to reopen, we would not take fish that we put into Louisburg in the past and put it into Lunenburg to make it viable.
Senator Stewart: You mentioned 14 offshore companies. Do these 14 offshore companies in your area have a percentage of the take?
Mr. O'Connor: Each of the companies has a percentage of the Canadian offshore quota, not the Canadian quota.
Senator Stewart: When you say the "Canadian offshore quota." you imply that companies from other countries have part of the offshore quota. What part of the offshore quota is the Canadian offshore quota?
Mr. O'Connor: They are all Canadian licensed companies. They are all based in Atlantic Canada. There are no foreign components to that.
Senator Stewart: Are you competing for perch, cod, pollock and yellowtail in Canadian offshore waters with ships that do not fly the Canadian flag?
Mr. O'Connor: No.
Senator Stewart: So the stories about foreign trawlers that we hear, Spanish and Russian and so on, are they fiction?
Mr. O'Connor: The only foreign vessel that I was aware of that fished in the Canadian zone last year was a Japanese vessel that fished 355 tonnes of 30 redfish which was an allocation that Canada gave them inside the Canadian zone. There was only one vessel. There might have been a Russian vessel that fished turbot for Seafreeze for landing in Canso in 0 far north of any area that we would fish. The majority of foreign effort exists outside the 200-mile zone. Some Cuban vessels fished inside the silver hake box on the Scotian Shelf.
Senator Stewart: What percentage of the Canadian quota for perch, cod and pollock does National Sea Products have?
Mr. O'Connor: Of the Canadian offshore quota, we have 45 per cent of the pollock, and we have about 38 per cent of the perch. The rest is a few percentage points here and there that make up the difference.
Senator Stewart: Are your primary species pollock and perch now?
Mr. O'Connor: Yes.
There are French allocations in the Canadian quota, not the Canadian offshore quota.
Senator Stewart: Around Saint-Pierre-et-Miquelon.
Mr. O'Connor: Yes.
The Chairman: I appreciate you taking the time to appear before us today. Thank you very much. Our next meeting will be on Thursday at 9:00 a.m.
The committee adjourned.