Proceedings of the Standing Senate Committee on
Fisheries
Issue 24 - Evidence
OTTAWA, Thursday, June 10, 1999
The Standing Senate Committee on Fisheries met this day at 9:00 a.m. to examine the expenditures set out in Fisheries and Oceans Votes 1, 5 and 10 of the Estimates for the fiscal year ending March 31, 2000.
Senator Gerald J. Comeau (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, our witnesses this morning are from the Department of Fisheries and Oceans. I understand that Ms Beal has some opening remarks.
Please proceed, Ms Beal.
Ms Carol Beal, Assistant Deputy Minister, Corporate Services, Department of Fisheries and Oceans: Mr. Chairman, we are pleased to be here this morning to share some of the information and the good news stories about our Small Craft Harbours Program.
With me today is Mr. Robert Bergeron, the Director General of the Small Craft Harbours Directorate, who is located in Ottawa. Mr. Bergeron is responsible for the policy and operating framework of the program. Also with me this morning is Maurice Girouard, who is the Regional Director of Small Craft Harbours for the Maritimes Region. He is responsible for implementing the program in the Maritimes area.
Our Small Craft Harbours Program looks after 1,651 harbours nationally. Of these, 1,159 are fishing harbours and 492 are recreational harbours.
In the brief you will see some pictures of a few of the sites that we have. Most of our harbours are the smaller harbours. There is generally a typical inshore fishery in a fishing harbour. The larger harbours comprise about 30 per cent of the inventory and deal with the larger commercial fishing harbours.
We have provided an overview of the fishing and recreational harbours by region. The black numbers you see in the brief indicate the fishing harbours and the red numbers indicate the recreational harbours.
We are very proud of our harbours program. It provides critical support for Canada's commercial fishing. Very often -- and I say this as a Maritimer myself -- it is the only federal presence in local communities. Part of growing up in the Maritimes is that you always knew where the government wharf was. It was an identifier. It was a community gathering place.
Senator Meighen: Is there a definition of recreational harbour and fishing harbour?
Ms Beal: Generally speaking, the definition is based on primary use. If the primary use is fishing, it is called a fishing harbour. If the primary use is recreational purposes, it is called recreational. If there is mixed use, it is based on the primary use in the harbour. Thus, if it is predominantly fishing, it is called a fishing harbour.
As I was saying, part of our harbour program is considered very much by the communities it serves as a public good. We take that very much into consideration as we deliver the program.
You will see in the brief an indication of how the Small Crafts Harbour Program fits into the overall asset base of the Department of Fisheries and Oceans. You will see that we represent approximately 30 per cent of the asset base in terms of the department's actual infrastructure assets. With respect to the budget of the department, it is $1.4 billion, of which a large portion is grants and contributions. Small Craft Harbours has a total budget of $55.7 million. Some of that is in capital, while some is in the area of operating expenses.
You will see an overview of how the budget is actually spent. We will be happy to answer any questions you have on that aspect of our presentation.
We have set out how the program is distributed in each of the provinces and territories. Recreational harbours are in the pink. It is a small portion of our budget, of course, because it is part of the program from which we are trying to remove ourselves, something about which I will speak more to in a moment.
The program is facing a number of challenges -- and I will highlight a number of these for the committee. Many of our structures pre-date 1950. They are beyond what we would call their normal useful life. Many of the structures are timber, as most of you would know, having seen some of these. The timber structures have a normal lifespan of 20 years to 25 years. Many of the other structures with which we deal are structures related to things such as breakwaters, haul-outs and other types of facilities. Given the oceans, the tides and the severe weather conditions, the useful life of those structures varies depending on location but, on average, is anywhere from 25 to 40 to 50 years.
As a result, we are facing an incredible rust-out problem. The Government of Canada is currently looking at its overall infrastructure, whether it be buildings, fleets, or harbour facilities. They are trying to come to grips with the rust-out issue with the government's inventory. We have a large rust-out problem in small craft harbours.
As well, labour and material costs are rising. Environmental issues and concerns surrounding our harbours are quite substantive. We have an increasing public demand for improved facilities. Commercial fishermen want improved access and better loadings. As we move to a more consolidated harbour infrastructure, there is an increase in the amenities required and the load capacity of the structures.
We have, of course, a large increase in our public safety risk. As the structures deteriorate and live beyond their normal life expectancy, the access to the general public on some of these structure is posing a public safety hazard.
Our liabilities are increasing, and not only environmentally. Our litigious liabilities are increasing as the condition of certain structures decrease. We are trying to deliver an ever-increasing demand on the program with a decreasing staff.
From the position of what is decreasing with respect to the program, our budget is going down. As I have mentioned, our asset condition is deteriorating. We have just about reached the end of the useful life of the majority of our assets. I regret to say that public confidence in our program is also decreasing. The state of my staff's morale, trying to do the best with a program to which we are emotionally tied, is becoming somewhat problematic. They would like to do more. They would like to do better. Unfortunately, we have to do the best we can with the dollars that we have available.
We have provided to you a brief summary of the active fishing harbours, which does not represent all the structures. It only represents the active fishing harbours for which the department is responsible. As you can see, about 58 per cent of these will be in need of work over the next three years.
The objective of our program is to keep our fishing harbours critical to the industry open and in good repair. With the dollars that are available to us, we have to come up with a strategy that allows us to accomplish that in the best way we can. We have determined that by rationalizing the inventory -- that is, by decreasing the number of active fishing harbours wherever that is possible and engaging in some partnering with clients -- hopefully we will be able to narrow the gap between the funding we have available and the demands that we have for it.
We have moved to a program of harbour authorities. We have tried to maintain our assets in at least fair condition, although from the inventory assessment I have provided you may see that we have not achieved that aim. We are divesting all recreational harbours in order to dedicate the money to the fishing harbours. Over time, we have taken on a progressive reduction of the inventory and consultation with the local community groups.
At the end, we hope to have a smaller, safer, more affordable and core harbour system delivered in partnership with the clients who use it.
One of the success stories in this program has been the Harbour Authority Program that we have attempted to introduce. We have reduced our harbours over 23 per cent since the start of program review. We have 51 per cent of all our active fishing harbours under local harbour authority management. Where there are harbour authorities, the communities now have a locally driven approach as to how that harbour is operated and managed.
There is a perception with respect to the harbour authorities, except by those who actually work in them, that, once we turn a harbour over to a harbour authority, Fisheries and Oceans basically abandons its responsibilities. That is not correct. What we do is turn it over to the local harbour authority so they can become actively involved in the operation and maintenance of the harbour. They can do things in that local area that we cannot do, given our funding limitations. They can generate revenues. They can integrate that harbour activity with other programs, such as tourism, community development, or recreational activities, that we would not be able to do, given our funding limitations.
We do, however, retain the responsibility for major capital. If something were to happen to the structure, we would be able to come in within our budget limitations and assist that local authority in making the substantive improvement to the structures.
So far, we have approximately 413 harbour authorities across the country. We have found -- and I am not sure if I am telling you a positive thing -- that the client satisfaction in the local community has gone up substantively once the harbour authority has taken over. That is not a reflection on the work of my staff but a reflection on the ability of community to do more than the department could do. They are very active.
Harbour authority associations have been created. We support the harbour authorities in their initial years with some assistance in the operating area. We provide them with training. Where the harbour authorities request it, we provide them with engineering and other professional support. We try our best to ensure that we do not simply say to a community, "Well, over to you," and walk away, because it is in our best interest as well to ensure the viability of those harbour authorities.
Since we started the program in 1988, we have only had one harbour authority fail, and it was taken over by the municipality. We are proud of the track record. We think the people in the harbour authority areas are doing a good job. They are really becoming professionals in their area and they are providing local, and in many cases the only, on-site management that the structure has ever had.
This is a good news story from our perspective, and we think that, if you spoke to the harbour authorities, you would find they feel the same.
I have mentioned that one of our goals was to rationalize the fishing harbours. We have some issues associated with that. In order to turn a facility over to a local community, we like to ensure that the facility is in adequate condition. We do not simply, again, off-load the federal problem. We try to fix it before we turn it over to the local area. I discussed earlier the rust-out issues and the need for money for the program to ensure the adequacies of these structures. We are working to try to solve those problems.
Let me say just a word on the recreational harbours, if I might. The recreational harbour program was one of the program review decisions announced in the 1995 federal budget. The Government of Canada determined that it would no longer be in the recreational harbour business. It is a fact that less than 5 per cent of the current recreational berthings are done at federal facilities. The rest are done at private or commercial facilities. In many places, we found ourselves in competition with the private-sector operator not too far away, so this program review decision was based in part on that. It was also based in part on wanting to direct all the money that we could to the active fishing harbours.
When the department put this forward, unfortunately it did not request the dollars necessary to improve these structures so that they could be divested to the local community. We have been trying for the last few years to dedicate a small portion, about 11 per cent, of the department's budget to enabling us to divest of these recreational harbours. Our long-term view is that, having divested of these structures, we will be able to direct most of the money to the fishing harbours.
However, based on that rate of expenditures, it could be another 30 to 40 years before we completely divest of all the recreational harbours. We have done fairly well over the last three years; about 58 per cent of them have gone. This is a fairly large number -- 486 sites out of the 844 -- but in many ways those were the easier sites. They were the smaller ones. The remaining sites are fairly large. A lot of the expenditure requirement is concentrated in 26 locations, mostly in Ontario and Quebec, and we are trying to come to grips with those locations as we move forward.
The recreational harbour program is, in fact, moving along, but it is somewhat slower. We have had a couple of recent issues associated with it. Many of our harbours have what we call reversionary clauses to the provinces for the water lot issue. Some of our issues with, for example, the Province of Ontario have been linked to other departmental issues, and our ability to get the province to waive its reversionary right has been somewhat limited. However, we are making progress and we think we have some very positive results.
Many of these recreational harbours have been integrated into a full recreational complex in some of the local communities -- turned into parks, for example, or into ecotourism areas. They have been very well received in the local community.
In conclusion, we view our harbours as public assets, we know the public views them that way, and we would like to see the use directed by the local community residents. The harbours are a very important part of Canada's fabric, the infrastructure of this country. We know that they are deteriorating faster than our budgets can deal with them, and we are making representations to our colleagues at the Treasury Board Secretariat with respect to the rust-out condition. We know that we are facing increasing public criticism in the delivery of this program because of the limitation of our funding. We know that the inventory reductions will help but it will not create for us a budget surplus. We are already behind the eight ball in that area.
We feel, however -- if I may speak on behalf of my staff and some of the communities that we have served -- that much has been accomplished in this area, and we know that we can do much more. We are in a very sensitive transition stage right now. We are hopeful, although not overly optimistic, that we will receive additional funding support for this program from the centre as part of a broader government initiative on rust-out. We look forward to turning that over to the good works in the communities in which we have facilities and currently serve.
Those are the comments that I would like to make as an opening, and my colleagues and I would be happy to respond to any questions.
The Chairman: Thank you very much, Ms Beal, for the excellent presentation and for the document that you have provided to us.
I have here a guide to federal small crafts harbours in Nova Scotia. Do you still publish those?
Ms Beal: Unfortunately, that has been one of the victims of budgetary cutback. Although I would like very much to continue to publish them, the structures are changing so much that to keep it up to date would be somewhat challenging, even on an annual basis. We do think they are good information documents with respect to the program, but I do not believe we even have any of the old copies. Maybe we have half a dozen or so left for disposal.
The Chairman: That is sad.
Ms Beal: We do have the information available on our website, though. Access to that structural information is available on the department's website.
Senator Stewart: Is this the first time that you have made a presentation on this topic to this committee?
Ms Beal: Personally, senator, yes, it is. I cannot speak for the department's history before this committee, but I could certainly check that for you. To my knowledge, it is the first time we have been specifically brought to this committee.
Senator Stewart: What about the House of Commons?
Ms Beal: We have made several presentations to the standing committee as part of larger presentations, and we have also made individual presentations to some members of the standing committee.
Senator Stewart: You use the expression "turning over" again and again. Yet, if I did not hear you wrong, you are saying that in many cases the Government of Canada is not abandoning the structure. The expression "turn over" is misleading because it tends to suggest to the outsider -- that is, the person not immediately involved -- that you are just walking. In other words, you have set up your harbour authority and then you are saying, "Goodbye." However, that is not true.
Ms Beal: Thank you for that clarification. You are absolutely correct in that it is not true. We turn over the local operation of the facility to the harbour authority. It is the operation that we turn over, not the structure itself. We do not walk away. We do not abandon the harbour authorities.
Senator Stewart: I am pleased to hear that. I was talking to some people last weekend on a local wharf in my area and they told me that they pay about $300 apiece for the management of the wharf. They also told me that it is tax deductible.
You spoke of harbours being allowed to deteriorate. That may not have been your language, but I gather that there are situations where no local persons are prepared to form a harbour authority. Perhaps you take that as an indication that the local structure is no longer used sufficiently to justify federal expenditure on that structure. Is that correct?
Ms Beal: Perhaps I would have chosen slightly different words to express that. We have a limited budget, and if there is not sufficient interest to form a harbour authority we must support the harbour authorities to whom we have already made commitments when they formed their harbour authority. We direct our financial efforts into support of the local communities that have established harbour authorities insofar as it is a limited budget situation.
Senator Robertson: I have talked with many fishermen for a number of reasons in the last while. You are familiar with Bay du Vin, Mr. Girouard. That is an example of a small craft harbour local management, or whatever you want to call it in your specific terms. They pay a certain amount, as you have indicated. The big problem they have is in dredging. Their harbour is filling up and they do not have the money to dredge. Right now, the only time fishing vessels can come in and go out is when the tide is high; otherwise, they are dragging the bottom of the seabed.
When you say that you are involved with maintenance, can you do anything about that? There are other harbours like this that I have been told about.
Ms Beal: I will ask Mr. Girouard to supplement my answer, but if I have understood correctly, they have not yet formed a harbour authority. We would look to you to encourage them to formally form a harbour authority, which would help us provide them with some assistance.
Mr. Maurice Girouard, Regional Director, Small Craft Harbours, Maritimes Region, Department of Fisheries and Oceans: At Bay du Vin, we have Hardwick, which is nearby. There are discussions at the moment to see if we can have those groups come together or, if they so desire, form their own harbour authority and function on their own. Those discussions are now taking place.
In terms of the dredging, Ms Beal explained earlier the position that we normally follow, namely, that we tend to move the available moneys toward those harbour authorities that are forming and operating at the moment. Therefore, respecting those harbours that show less interest, we tend to have a lower priority.
Senator Robertson: I will go back to the fishermen there because they were showing me the exact amounts they were paying. I do not understand that, but I shall go back personally to check because they were telling me they were paying a number of dollars.
Ms Beal: We would be happy to clarify it with you after the committee or at some time when you have more information.
Senator Robertson: I would appreciate that. When I go upstairs, I will call the fishermen who are telling me what they were paying because that does not balance.
How many small craft harbours in Quebec and Ontario have you closed?
Ms Beal: Actually closed?
Senator Robertson: Yes, or turned over.
Ms Beal: In terms of the number of harbour authorities that we have set up?
Senator Robertson: Yes.
Mr. Robert Bergeron, Direct General, Small Craft Harbours Directorate, Department of Fisheries and Oceans: In Quebec?
Senator Robertson: Yes, in Quebec and in Ontario. Tell me how many there are and how many you have been able to persuade to take them over.
Mr. Bergeron: In Quebec, we have about 50 harbour authorities.
Senator Robertson: How many small craft harbours altogether?
Mr. Bergeron: There are 95 fishing harbours, and 113 recreational facilities in Quebec.
The concept of harbour authorities does not apply to recreational facilities because with recreational facilities we are trying to divest the ownership of those facilities. We are not encouraging the formation of harbour authorities for recreational facilities.
Senator Robertson: You are financially supporting them still, though?
Mr. Bergeron: For the most part, we try to negotiate agreements with municipalities. As part of those agreements, we agree to make some repairs at those sites to be transferred. The only others we make at those facilities are conditional to divestiture. We do make some minor repairs to ensure that these facilities are safe until they are transferred.
Senator Robertson: At some other time, perhaps you could send me the amounts you have spent on the small craft harbours, whether they be recreational or fishery, in Ontario and Quebec. I would appreciate that.
Ms Beal: Yes.
Senator Butts: I wish to go back to some of the words that Ms Beal used. Some of them are taken, I understand, from a 1995 fact sheet.
Ms Beal: They may have been, senator.
Senator Butts: For example, when you say "rationalize the commercial fishing harbours," what do you mean by "rationalize" in this context?
Ms Beal: What we mean by rationalize is "to consolidate and come up with the right number at the end of the day."
Senator Butts: The DFO's right number?
Ms Beal: We like to think that it is the right number in consultation with the user community. We also like to think that it is the right number in relation to the affordability and the budget issues.
Senator Butts: That same document refers to commercializing or privatizing non-essential equity holdings. To whom are they non-essential?
Ms Beal: You have the advantage on me, since you have the document in front of you.
Senator Butts: It has been around since 1995.
Ms Beal: Yes. I am sure it is an historically accurate document.
The non-essential component would be as it would relate to the department's current program initiatives. I would put it in that context. I may be somewhat remiss in not being overly familiar with that document, but I would think that would be the context.
With reference to the date, it would have been written in the program review context in which departments were asked to review their programs in terms of which services were essential and which were not. I would go back to that period.
Senator Butts: Yes, it would address those that would be privatized and those that would be commercialized.
The part that bothers me more than anything else about this is that it says that the Department of Fisheries will enter into partnerships with the fishing industry and others in the management of capacity licence and compliance.
It goes much further than small craft harbours. Do you coordinate with the rest of the department?
Ms Beal: Yes, senator, we do. Our program is an infrastructure program in support of the commercial fishery. My colleagues in other sectors of the department are responsible for licensing and capacity issues, and we work very closely with them to co-ordinate our efforts. We would find it inappropriate, for example, to increase the infrastructure capacity of a facility in an area where the licensing and fishing capacity is being reduced.
So, yes, we do work very closely with colleagues in other sectors to ensure consistency.
Senator Butts: If the licensing continues to the big ones, we will not need many small craft harbours; therefore, you will have an easier time.
The Chairman: Interesting comment, senator.
[Translation]
Senator Robichaud: Does your disposition policy take into account private industry? We have federal agencies, the provinces, the municipalities and non-profit organizations. Let me give you one example of a private-sector initiative. The marina in Aldoine has some very good facilities and an aquaculturist has been using the facilities on the old wharf and is even thinking about opening a small plant. The problem is that the locals do not want to see him set up his business at that location and both he and the industry could encounter problems. Do you take into account special circumstances where there might be opportunities for the industry to develop?
Certainly there will be many communities where the residents would prefer to have cottage lots rather than wharfs. This limits access to the aquaculture industry which, in some cases, requires saltwater, for example, to maintain lobster cars. Do you take these requirements into account?
[English]
Ms Beal: Senator, the issue of aquaculture, recreational facilities, and the infrastructure is an emerging one. The aquaculture industry is growing. The presence of aquaculture in many of the areas is increasing. We are now trying to understand what this means to the other users of the waterway and harbour facilities. I have no quick answer to your question. I will ask Mr. Girouard to speak to some of the details to it.
However, I want to assure you that this is a policy debate emerging within the department. How does one balance these competing interests? Clearly, we would consider the community views on that issue. The community, when taking on the recreational harbour in the first instance, had a vision for its local community. They may or may not have thought of the private-sector utilization. Thus, it is an emerging issue for us. Presently we have no policy on it, but we are actively investigating how to balance these various areas.
Mr. Girouard can be more specific.
[Translation]
Mr. Maurice Girouard, Regional Director, Small Craft Harbours, Maritimes Region: Generally speaking, the answer is yes. We try to take into account local industry requirements which can compete somewhat with the normal process. You are describing a situation where before turning to the private sector, the municipality and non-profit groups must be consulted. We are still in negotiations as far as the situation in Grand Aldoine is concerned. Our goal is to bring the different stakeholders, namely recreational boaters and the industry, together to allow direct access to the harbour, without having to turn operations over to the private sector. When facilities are turned over to the private sector, we must go through the tender process.
Senator Robichaud: However, in this particular case, you will recall that a lovely recreational harbour was built and that the recreational boaters decided it was located a little too far away, several miles in fact, from their residences. They therefore decided to move all of the floating wharfs to Richibucto. Now, the facility in Grand Aldoine is underutilized, but because of space constraints in Richibucto, residents are in the meantime circulating a petition to block a small aquaculture business from opening a plant. That is unfortunate, in my view, because a small aquaculture venture provides employment for 10 or 12 people. That is significant in our region. You say that negotiations are under way. Industry requirements must be taken into account because access to the sea and inland waterways is quite limited in our region. Lot prices are exorbitant and the few harbours we have should remain accessible.
Mr. Girouard: In this particular instance, we would be amenable to selling or transferring the harbour in question to a company, which would in effect privatize the facility. We would prefer to see management of the facility taken over by a non-profit group which would have the public interest at heart and which would work to manage and develop the facility along with the industry.
Senator Robichaud: The association of aquaculturists is very keen on taking over management of the harbour and it has said it would give recreational boaters the same access they enjoyed before. Acquiring the facility would give them some measure of security so that a year or two down the road, they would not face the prospect of being told that they must move their operations elsewhere.
Mr. Robert Bergeron, Director General, Small Crafts Harbours: We also try to arrive at a consensus of sorts with local governments. We try to avoid conflicts. In situations where there are clear competing interests, we avoid disposing of our facilities in this manner. This has been our approach from the very beginning.
Senator Robichaud: However, you will be receiving a petition from local residents. It is unfortunate, in my opinion, because it could prevent an industry from developing. In this instance, I have to side with the industry.
[English]
Senator Adams: Ports are starting to privatize. I remember when the Minister of Transport began to privatize ports. I know small harbours and ports were turned over to the Fisheries and Oceans Department. Some ports went private and some were turned over to the municipality. At that time, small communities, especially on the East Coast, were very concerned about being able to operate. However, Transport Canada guaranteed them between $120 and $123 million in upgrading. Is that happening now? Right now some of the ports are being turned over to the private sector and the municipalities. How is it done now?
Ms Beal: Perhaps I could speak to the Transport Canada situation. They did receive approximately $125 million to help them facilitate the divestiture of the commercial harbours. That program is ongoing. They are making substantial progress.
As I mentioned earlier, senator, our department did not ask for an equivalent type of fund. It was regrettable; however, at the time, it was not seen to be appropriate to ask for it.
We have a pent-up problem to help us on the divestiture side. We are working within our budget limitations.
One of the issues we are bringing forward to Treasury Board is a requirement for funding to help in the divestiture program. We are very concerned that we do not turn over facilities that are in inadequate condition for the local people to administer. It is clearly not one of our program objectives to dump on the local area.
We are following a fairly consistent program to Transport within the budget that we have. They are funded for that approach, and we are not.
I am not sure if that answers your question.
Senator Adams: Yes, it does. We have small ports in the Arctic, and everything has been turned over to Fisheries and Oceans.
How does the current system work if, for example, people request upgrading of a port? Some of the places are getting bigger ships and some people are developing private small boats and canoes. Some of the communities are putting up breakwaves in the coves and other places. That costs money.
How does it work with small communities, especially in the Arctic now that we have the new Nunavut government? How will the communities receive funds? Who would they approach?
Ms Beal: We would have to clarify whether the location was under the administrative control of the Department of Fisheries and Oceans. If it were a small craft harbour, we would look at whether it was in the fishing harbour group or the recreational harbour group, and we would apply whatever was appropriate to the program at the time.
I am afraid it is a little difficult for me to answer you in general terms. We generally are not looking to take on new sites. We are working hard to deal with the sites that we have in our existing inventory.
Unlike the period in the 1980s, for example, when we would have built new structures at the request of communities, we are no longer doing that. In new locations, what we are trying to do is tie it to the harbour rationalization that we are doing.
If you had a specific example, senator, perhaps I could answer you after the committee, to deal with the specific location, but in general terms we are not looking to build new structures.
Senator Adams: My concern is whether you have any requests right now. What would a community do if it needed to do some work on its harbour? Would they go to Fisheries and Oceans for help, or would you say that it was their problem and that they must raise their own money.
Ms Beal: I do not believe I have a good answer to your question, senator, just let me say that at the start. If a commercial fishing harbour were looking to move, for example, and that were consistent with the program objectives, we would work with them to assist in whatever way possible with that physical relocation of the harbour infrastructure.
We are very cautious about new requirements. I would hope that we would not say it was their problem. I would hope that we would work with the local community people to identify perhaps the appropriate place to go. However, without knowing the exact circumstances, I could not answer you more specifically. I would be happy to speak with you after about a specific location, if you have one in mind.
Senator Adams: Currently, ships are coming mostly into the port of Montreal. People say that they can get cheaper shipping rates from Montreal. What about docks that are not being used any more? Some of them have millions of dollars of equipment.
Ms Beal: If I understand the general direction of your question, perhaps it is more appropriate to discuss that with Transport Canada. However, I would be happy to speak with you after and help clarify that for you.
Senator Cook: I would like to pick up Senator Robichaud's concern with the emerging industry called aquaculture.
You talk about working with stakeholders in order to arrive at a consensus. After the process that you have talked about has run its course, who ultimately makes the decision? Who is the boss?
Ms Beal: I would like to say that the decision would be based largely on community consensus, with our people working with them as they have developed that. The ultimate responsibility, however, does rest with the department to determine where it expends its funds.
We try to avoid, wherever possible, a situation where a local community might feel that we have imposed a solution on them. We prefer to have a community-based, community-driven solution. To the credit of most of the people who work directly in the field, they are very intimately involved with the community groups.
Much of our role is turning more to being a facilitator of discussion. We are bringing the community groups together to arrive at a consensus. I know you would appreciate the difficulty in this because of the various interests in a local community, but we work with them.
We are fully cognizant of all the issues they are raising as they work through this process. Ultimately, the decision does rest with us.
If it is a divestiture, we are encouraging as much as possible the community to come together for an ultimate resolution of this. From our perspective, we have no clear view one way or the other as to who should ultimately retain a structure once it has been divested by this department. That is a community-driven decision.
Senator Cook: I am trying balance recreation and jobs.
Ms Beal: That is an emerging, challenging issue. We are also trying to balance aquaculture against navigable waters and the access and use to the waterway. This is a matter of some discussion right now within the department. It is a challenge.
Senator Meighen: I do not understand "balancing recreation and jobs." Does that mean that recreation does not involve the creation of any jobs?
Ms Beal: No, I am sure the senator did not mean that, Senator Meighen. I think that the senator was referring to the balance between an aquaculture industry, where the pods, for example, would occupy a large portion of the harbour, and the ability of recreational users to have access to what they previously viewed as an unencumbered harbour.
Senator Meighen: Would you say that your approach to the divestiture program now is, generally speaking, proactive or reactive?
Ms Beal: We would like to think that it is proactive in the sense that we are out there trying to encourage communities and local groups to take on the facilities. It is reactive in the sense that we try to respond to the community consensus.
Senator Meighen: If they all decided tomorrow morning they wanted to do that, it would be very difficult for you to deal with them all, or impossible.
Ms Beal: I would definitely try to rise to that challenge, senator. That is our goal, to divest them all as quickly as possible.
Senator Meighen: I am sure it is. Are the funds available to do that?
Ms Beal: That is our challenge. We do not have the funds.
Having an agreement with the local community would make it a stronger case for me to go forward to the Treasury Board and say, "We have these arrangements already negotiated with the local community; please support our implementation of this government program."
We have some agreements now in which we are unable to fund the rehabilitation work on the structures. We are seeing a great deal of patience on the part of our partners in that negotiation as we move toward to try to get the funds. So we would be able to do it with access to funding; that is correct.
Senator Meighen: That is really what I was trying to get at. To what extent is the program being put in jeopardy because of lack of funds? Human nature being what it is, obviously people will become fed up and discouraged.
Ms Beal: That is one of risks we face, given our current funding situation. The momentum, if you will, for the program may be dissipating. As with everything, there is a pendulum. There was a great deal of community acceptance of the program as we went into it. They understood the fiscal reality of the federal government. They seemed to be quite willing to take on these structures.
Over time -- some have been sitting there with agreements for a year or more -- they are saying, "We want to get on with this. If you will not support us, perhaps we cannot do it this way."
We are trying strenuously to make a case for additional funds from the centre. I am sure we would welcome any support we might get in that regard.
Senator Meighen: With the ongoing changes in the commercial fishery -- ITQs, et cetera -- to what extent are these changes in the industry creating a moving target? You do get concentrations here and there. A harbour that was originally appropriate for divestiture may, for other reasons related to the industry, now become a harbour that is not appropriate or desirable for divesting.
Ms Beal: There is probably sufficient stability in the overall community of fishing harbours to say that, while that may pose a problem in isolated cases, it is probably not a general problem. We are trying through the rationalization to look at things like access to processing plants, access to appropriate infrastructure, and so on. We have moved in the rationalization program to create harbours that should be viable harbours over a period of time, notwithstanding any changes in the fishery.
For example, if the species being fished changes, the harbour infrastructure is quite capable of moving from groundfish to, say, shrimp. We are trying very hard to ensure the long-term sustainability of the harbour infrastructure, notwithstanding issues of specific quotas and who may or may not have them.
Senator Meighen: Do you have any program in place to become re-involved if, say, a local authority collapsed, for whatever reason? I am thinking particularly of a commercial fishing harbour where the livelihood of many people would be in danger if, for whatever reason, the local authority demonstrated that it was unable to properly run the facility.
Ms Beal: Fortunately, senator, that is not a situation that we have had to face so far. The harbour authority program is a maturing program. The success rate, as I pointed out earlier, has been very good. We remain in constant contact with all of the harbour authorities.
Our local small craft harbour officers, for example, are intimately and regularly engaged with the harbour authorities for advice and guidance. We are there to support them. If they need financial management support, we try to do that. We work with the harbour authority associations. It is in our best interest to ensure the viability of these harbour authorities. We do whatever we can to support them to do that.
We have great confidence in the professionalism of the people who are currently operating the harbour authorities. We think the future for them looks good. While it would be very prudent for us to have a plan in place if something like that were to occur -- and we will work to ensure that it does not -- the track record so far has been very positive.
Senator Meighen: Your ongoing cooperation is infinite?
Ms Beal: It is infinite insofar as our capability allows, but there is a difference between personal cooperation and financial support. The ongoing personal cooperation of our small craft harbour officers is there. They are very dedicated to this program. They have personal relationships with most of the harbour authorities that have been established and they are there to help. We take some pride in that.
Senator Perrault: Mr. Chairman, there is some exceedingly ominous wording in this presentation. The message to me is that they are in urgent need of more money. When I see the words "increasing infrastructure rust-out, labour/material costs, environmental costs, public demand, public safety risks, DFO liability, staff workload" as well as "decreasing program budget, asset condition, asset value, public confidence, staff morale on the down side," that is not very comforting language.
If the necessary funds were made available to you, what would your starting point be? What would you do first with the money received? What are your priorities?
Ms Beal: We would deal first and foremost with the health and safety issues. We have an obligation. We are dealing with those now but there are so many of them out there. Presently, 20 per cent of them are considered to be in an unsafe condition. Therefore, that is our first priority.
Senator Perrault: That is a deplorable statistic.
Ms Beal: Yes, it is. It is not a statistic about which we are proud, but our responsibility here is to provide with you the facts and these are the facts.
Senator Perrault: It is heartening that you have done that, but there is a long way to go here. Between the lines there are real problems.
For British Columbia, my province, do you have a breakout of the statistics relating to breakwaters and shore protection? How does British Columbia measure up statistically with the rest of the country?
Ms Beal: In terms of the overall size of the program, there are 159 fishing harbours and approximately 30 recreational harbours. The actual breakdown of the statistics in terms of various types of structure could certainly be provided without any difficulty.
Senator Perrault: That would be of interest, but there is no comfort in these statistics. You say that immediate action is required. A major program is needed right now. Is that what you are saying?
Ms Beal: That is what the facts would indicate, senator, yes. I should point out that British Columbia has one of the more active harbour authority programs. Our local people there are working very diligently with the local harbour authorities that exist in British Columbia. We have done some innovative work there with respect to fire hazard, fire control, in each of the harbour structures. Our people are working very hard with the local communities, and the relationship with the harbour authorities there is very good.
Senator Perrault: There is good community cooperation then?
Ms Beal: Yes. There is basically no problem there that a little money and understanding of the implications of the Delgamuukw court decision would not help. That is correct.
Senator Perrault: Are there any innovative design changes, for example, in these small harbours that might be built more efficiently? Are there different materials being used, preferably those that last a long time?
Ms Beal: We have been doing experimentation in at least two areas with which I am familiar, senator. We have a program, if I could use this expression, of almost an IKEA-type floating structure.
It comes ready to assemble. We developed that approach to allow us to ship an extension to a floating-dock system to a local community where it could be installed locally.
Senator Perrault: It is much more flexible.
Ms Beal: Yes. It has been very well received.
We are also using, for ballast and other types of things, new materials such as plastics and so on.
Senator Perrault: They have a greater buoyancy.
Ms Beal: Yes, but more to the point, senator, there is less maintenance. The material itself does not deteriorate.
Senator Perrault: That is the question, yes.
Ms Beal: A very interesting publication that was put out by the harbour authority -- and we will send you a copy -- outlines one of the newer innovations in the use of plastics in the harbour. It is not a departmental publication; it is a local harbour authority association publication.
Senator Perrault: If Canadian scientists are developing these, that is encouraging.
Senator Adams: Are you sure they are Canadian?
Senator Perrault: I appreciate the information you have given us. It has been a good presentation.
The Chairman: I have a few brief questions before we go on to our second round.
My first question refers to comments by Senator Butts and Meighen on ITQs. I wish to pursue this a bit.
We know that ITQs are to rationalize and concentrate the licences into fewer hands, to make it easier on officials. You do not need to comment on that. This would obviously concentrate the landings at fewer sites, which seems to mesh in very well with the budget squeeze that your section is having to endure.
Are discussions being held between your section and the policy section that promote ITQs in such a way that you are zeroing in on certain harbours at which those landings will be held? In other words, are the communities being targeted?
Ms Beal: The quick answer to your question, senator, is "no."
Perhaps I could explain that dialogue takes place to ensure that we are not investing taxpayers' money in an area where another policy initiative would indicate that there may not be a need for that investment in the future. We are trying to ensure the utmost of collaboration among my colleagues at Fisheries and Oceans to ensure that the dollars we spend are dollars that are consistent with the overall policy and program direction of the department.
We do not go in and say, "Well, where should we stop spending money?" As the other senator pointed out, stopping spending is not our problem; having enough money to spend is. Therefore, we must make choices. We do not want to invest anywhere where we are not consistent with the overall policy objectives of the department.
I have never had a discussion with colleagues where we say, "Do not spend money in this harbour because we want to reduce the licences in that harbour."
The Chairman: It probably would not work out that way anyway because much of the concentration is being handled by the marketplace; as such, survival of the fittest is the order of the day. Whatever will happen will fall where it may.
I have a brief question on wharfs. The coastal communities network in Atlantic Canada did a study a few years ago. Over the past couple of years, the study was independently assessed by Professor Dan MacInnes of St. Francis Xavier University. The findings of this study are, to say the least, not very supportive of the direction of the harbour authorities.
There was a high rate of return on the study. Do you have plans for storm-related loss of wharfs? No, 87 per cent. Does the harbour authority have a long-term funding plan? No, 80 per cent. Should DFO download responsibility for other harbour facilities? No, 84 per cent. Will you sell the wharf to private ownership? No, 100 per cent. Should there be changes to the divestiture policies? Yes, 78 per cent. That is the kind of response they received.
We hear from you that you are committed to ensuring that the fishing industry has the harbours. On the other hand, we are sensing from this response that the industry is not attacking you as such but is attacking the situation. Therefore, this is obviously not progressing as well as we would all like it to.
How do we handle, as parliamentarians, the kinds of responses that we are getting from the community? What do we say to them?
Ms Beal: That is a good question, senator. I think that part of the issue involves a conflict regarding objectives and perspectives on what is possible.
As a Maritimer, I can say that there is sometimes a perception that things are better handled when left in government hands because there is an apparently unending pool of money. Unfortunately, that is not always possible, given the fiscal reality of the government; nor is the best solution always to have it government-driven. We are sensitive to the comments that came out of the study. Perhaps the timing of the study in relation to the maturity of the program may have had an impact as well.
We have made a number of changes over the last two or three years in the program in terms of the positive view that the program now has in the local communities. Again, much of it seems to boil down to issues of dollars and communication. I do not think I am speaking out of turn by saying that, when the program initially started, there was a lot of local resistance to it. It was not very popular. Much of our effort was spent in trying to communicate a very unpopular program to people who wished that it did not have to be dealt with.
Since then, the communication efforts from the officials in the department and the responsiveness from the local communities, and their belief now that the department wants to provide them with an infrastructure that meets their local needs and not just dump the program on them, has turned some of those perceptions around.
The Chairman: I might just say in passing that most of these people are not accountants or strategic planners. Many of them are busy fishing rather than being on the wharf planning how to replace light bulbs and dealing with electrical problems. They are good business people, and I am not suggesting that they are not, but they do not have the staff and facilities to undertake the work that you in the past at Small Craft Harbours used to do, the strategic planning and so on. I just note that in passing. I am not suggesting that they are not great business people. In fact, they are. However, they are doing something else. They are fishing.
Ms Beal: The harbour authority administrative people are generally not active fishermen themselves. However, fishermen may comprise the harbour authority. The actual day-to-day planning and administration and liaison with the department is done by either an official paid by the harbour authority or a volunteer official from the harbour authority who is not necessarily an active fisher at the time, depending on the size of the harbour. In some cases, the person is a very professional harbour manager who may have previously worked either for ourselves or for Transport Canada in that capacity.
The Chairman: At the end of the day, you want the fisherpeople themselves more involved in what their harbour needs.
Ms Beal: We anticipate that their involvement will be with the harbour authority itself and that they will be directly influencing the decisions taken by the local harbour authority.
Senator Stewart: Mr. Chairman, would you review the language that you quoted with regard to destruction of harbours, just at the beginning? I wish to base a question on that passage from the survey.
The Chairman: Do you have plans for storm-related loss of wharves?
Senator Stewart: All right. Assuming that a wharf was regarded as necessary in a particular place, if there were a storm that devastated that particular wharf, would the replacement be the responsibility of the local authority or of the Department of Fisheries and Oceans?
Ms Beal: They would consider that a major capital expenditure and the department would go in and replace the wharf within its budget limitations.
Senator Stewart: We have here an example of the misleading character of the term "turnover" because you are talking about turnover of the management of particular situations rather than major capital expenditures.
Ms Beal: That is correct.
Senator Stewart: I believe that that is part of the problem. How much of a saving does this local management program achieve for your department? How many millions of dollars does it save?
Ms Beal: Again, I would be reluctant to put a figure on it because I do not believe it is a large saving in terms of actual dollars. It is a saving in terms of time, it is a saving in terms of the number of staff that are required to inspect, to operate, and so on. Where we have a harbour authority in an active fishing harbour, we have, for example, been able to not have what used to be called a harbour master or a local official. It means less visits by departmental staff, which has a savings in O and M. In the grand scheme of things, senator, these would add up to a small amount of money. It would not be multi-millions of dollars.
Senator Robichaud: How much more money did you succeed in raising with the harbour authorities that were not there before?
Ms Beal: In terms of actual work being applied to the structures?
Senator Robichaud: As well as in fees, contributions in kind, and such.
Ms Beal: I have been told that it was approximately $4 million to $8 million.
Senator Robertson: I wish to come back to the dredging problem. Where you have local harbour authorities, what has been your policy on dredging?
Ms Beal: With respect to the local harbour authority, generally it is a two-phased approach. In order to facilitate the adequacy of the structure for the local harbour authority, we may go in and dredge. The harbour authority is being created as an incentive, an encouragement, and part of our responsibility is to ensure that they are provided an adequate structure, with a sufficient depth of channel to operate that facility. Over time, however, dredging becomes an operational expense and the operations of the harbour authority are under their own administration and control and, therefore, they fund their own dredging.
Senator Robertson: Even if the cost of dredging meant that the local harbour authority could not do it and, therefore, that the local small craft harbour would need to be closed, that is your firm policy?
Ms Beal: If the result were the closure of a harbour, senator, we would go in and provide some assistance. We are still supporting the local harbour authorities to the tune of some $3 million to $4 million a year in their operations. Our goal is to have them self-sustaining by the year 2001.
Senator Robertson: Of all the small craft harbours that you have under local harbour authority, would you please provide me with the names of ones where you have assisted in the dredging since the time of the formation of the group? In these remote communities, it is a very substantial cost, as you know.
[Translation]
Senator Robichaud: I merely wish to comment on something Ms Beal said. She subsequently tempered her remarks. Initially, however, she said that the program had the backing of the public. Mr. Girouard will recall all of the lively discussions we had about this program. Nevertheless, it has proved successful. Senator Robertson is familiar with Pointe Duchêne. At one point, considerable money was needed to make repairs to this facility, but the money was not forthcoming. It was neither a recreational harbour, nor a fishing harbour, but the community rallied behind the project and the necessary repairs were made. Now, many visitors come to Pointe Duchêne.
Last year, a drowning occurred at Pointe Sapin and the victim's body was never recovered. I believe arrangements have been made with the harbour authorities to ensure that when the harbour is dredged, special care will be taken so as not to cause the victim's family further grief. I want to thank the authorities for that thoughtful gesture.
[English]
Senator Stewart: I will go back to the question raised by the Coastal Communities News story to which you made reference, Mr. Chairman. It is the story of June 9, 1999, and it says:
(Small Craft Harbours, the section of DFO that has long held responsibility for our wharves, has seen its budget trimmed from $126 million in 1989-90 to $51 million in 1997-98.)
From 1989-90 to 1997-98, its budget dropped from $126 million to $51 million.
You have told us that the shift-over to the use of local harbour authorities has not effected a great saving in money, however, what it may have provided, in addition to a small saving, is better local, therefore, more satisfactory management.
I move away from that to the fact that your portion of the DFO budget has dropped dramatically in a 10-year period. Where has that affected the structures and the dredging, the reality of which is produced by the expenditure of departmental money?
Ms Beal: Senator, the budgetary changes for the small craft harbour program have quite clearly affected our ability to deliver the program in the manner in which we would like. Our minister is also responsible, however, for search and rescue function of the Canadian Coast Guard and a number of science-related activities. The coast guard fleet is facing a similar rust-out requirement as our structures, and there needed to be choices made to keep our fleet afloat in order to be able to fulfil our search and rescue.
Senator Stewart: Are you saying, then, that these other costs, to which you just now referred, come out of the small craft harbours vote?
Ms Beal: No. We have two votes in the department; one is an operating vote, the other is a capital vote. The votes are total to the department, of which various programs have components. Overall, in the 1980s, we had approximately $147 million dedicated to the small craft harbour program. Over time, through decisions made by the Government of Canada, through decisions made in the program review process, and internal decisions by the department, the small craft harbours budget has decreased. At the same time, however, the department's total budget has been decreasing as well. You would appreciate that, senator. These internal changes have been relative to other changes in the department.
Senator Stewart: The form of the estimates is now much more generalized than it used to be; however, I take it from what you have said that the line from which small craft harbours draw their money has been reduced in order to put money into other lines such as those that you mentioned.
Ms Beal: I perhaps would not express it that clearly, senator. Obviously, an engineer is no match for a lawyer, however, the issue for us is that much of the small craft harbours money initially was in what we call "sunsetted programs." That is, when the program expires, the money expires and we lose it.
There have been minor adjustments internally within the department, things that have been reallocated from one area to another, but they would amount to less than 1 per cent.
Senator Robertson: When you had this rather massive reduction in your budget, what has been the staff reduction over that period of time?
Ms Beal: I do not think it has been large, senator, approximately 10 or 12 FTEs. The largest portion of our budget goes to construction activities. That is where that large volume of dollars would have been directed.
Senator Stewart: Mr. Chairman, I, too, received a copy of the Coastal Communities Network Newsletter. I notice that many of the respondents to the questionnaire were from Cape Breton Island. That prompted me to ask about the situation in the Bras d'Or Lakes. Do we have declining commercial fishing activity in the lakes with the result that the need, as an outsider might perceive it, for facilities is also declining?
Mr. Girouard: The commercial fishing activity in the Bras d'Or Lakes is treated no differently than the rest of Cape Breton and the rest of Canada for that matter.
Although there is perhaps some decline, the harbours that continue to function with commercial fishing will be treated as will the others through the harbour authorities program.
Senator Stewart: We have had evidence before this committee again and again in regard to the Eastern Shore. I am speaking particularly of Guysborough County, the part of the Eastern Shore I know reasonably well. We have been told that the lobster and groundfish populations are down, but that the lobster figures, in particular, are an anomaly. Approximately how many of these harbour authorities do you have in Guysborough County?
Mr. Girouard: I would guess a figure in the range of 20 to 30, something of that nature.
The fact that the communities want to get involved through the harbour authority programs, even in areas where the fishery is down, and that one is definitely one of those, means that we will retain our interest. We will continue to deal with the community and those people and try to ensure the survival of that wharf and harbour.
Community interest is key. When the community gives up or does not feel a requirement for the wharf, then we feel that neither should we, and we proceed in that fashion.
Senator Stewart: Thank you very much.
Mr. Chairman, when we are finished with these witnesses, I wish to raise a point of concern.
The Chairman: Before we do that, I wish to inform honourable senators that our researcher, Mr. Emery, has advised me of a Web site run by Gadus Associates. It is one of the main fisheries-related sites in Canada. I wanted to quote a statement that appears on that site:
This site has similar information to that offered by its House of Commons equivalent. Of more solid material, it offers the committee's recent report.
I think that speaks well for our committee when we are called "of more solid material" than the other place.
Senator Stewart: That is not necessarily saying a great deal.
The Chairman: I have also received a letter this week from the minister asking us if we would like to be briefed on the elements and impacts of the Pacific Salmon Fisheries Agreement.
If there is committee interest, we could ask if the minister is available next week. Is the committee interested?
Senator Robertson: I would prefer to meet with the fishermen on the West Coast who are impacted by this decision before we meet with the minister.
The Chairman: Unfortunately, our budget to go to the West Coast was not considered by Internal Economy. I think they were spooked by a number of individuals from the other place into not responding to our requests for a budget to go to the West Coast, where we have not been since 1986.
Senator Perrault: It is a total affront to the West Coast.
Senator Robertson: It is disgusting. How can we ask the proper questions without accurate information from the fishermen? I would like to meet with the minister, but I would like to have the knowledge that the fishermen can give us.
Senator Stewart: In answer to your question, Mr. Chairman, if it can be arranged to meet with the minister next week, then we should try to do it. We can get material on the record that may be useful to the committee.
The Chairman: Leave it with us, and depending on the minister's time availability, we will see what we can do.
Senator Robertson: You could have him attend to inform us on the agreement, but advise him that, in the fall, he could come back after we meet with the fishermen on the West Coast.
Senator Perrault: Those are important meetings in the fall.
The Chairman: I do want to pass on my very special thanks on behalf committee to the witnesses this morning. Our discussion was very open and frank.
Ms Beal: On behalf of the people who serve this program, we would like to thank you for your interest.
The committee adjourned.