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Proceedings of the Standing Senate Committee on 
Fisheries and Oceans

Issue 1 - Evidence, November 4, 2004


OTTAWA, Thursday, November 4, 2004

The Standing Senate Committee on Fisheries and Oceans met this day at 10:48 a.m. to examine and report on matters relating to the federal government's new and evolving policy framework for managing Canada's fisheries and oceans.

Senator Gerald J. Comeau (Chairman) in the Chair.

[English]

The Chairman: Before I welcome our witness, let me welcome Senator De Bané to the committee. Senator De Bané has vast experience in the whole field of fisheries and oceans. He is a former fisheries minister and a past member of this committee.

[Translation]

Welcome, Senator De Bané. We are proud to have you as a member of our committee. We have no doubt that your contribution to our work will be invaluable and we are appreciative of that fact.

[English]

I would like to welcome our witness, Mr. Bevan, who is no stranger to this committee, and who appears under different hats — be it NAFO, aquaculture, science and a host of others.

Mr. Bevan, I think you have an opening statement. We were discussing earlier how opportune the time is for your department to be invited before the committee, because of the work it will be undertaking shortly.

Mr. David Bevan, Assistant Deputy Minister, Fisheries and Aquaculture Management, Fisheries and Oceans Canada: Thank you, Mr. Chairman. First, let me introduce the acting director general of policy planning and coordination within fisheries and aquaculture management, Mr. Michel Vermette.

I would like to have the opportunity to say a few things, but, first of all, thank you for inviting me here today. As you said, Mr. Chairman, it is an opportune time for us to explore some of the policy changes that we are contemplating within Fisheries and Oceans.

We face a number of challenges within Fisheries and Ocean in managing the natural living marine resources for the benefit of Canadians. These are resources that go through cycles of abundance as well as market cycles in terms of value.

The instrument we have to deal with this is more than 136 years old, the Fisheries Act. The governance structure that is provided for within the Fisheries Act provides absolute discretion to the Minister of Fisheries and Oceans in making decisions about who gets to fish, how much and where they fish, with what gear they fish, all the details. That means that all decisions that are in any way controversial have to be made by the minister.

It also means that access and allocation is not stable, that each individual ministerial decision can, over time, create a fishery that does not have the optimum performance or the best conservation outcomes. It also means that there is a lot of conflict and confrontation among fishermen in competition for access and allocation. There is no process for making those kinds of decisions other than the minister's decision. Therefore, the only way to intervene is through political pressure, demonstrations, et cetera.

That has created an environment where we have fishermen very much focussed on shares and on adjusting shares and trying to find a way to solve their problem not by making the best use of the fish they have available, but by trying to find a way to maximize their share of the available catch. That focus has taken the focus away from value and put it on volume.

Our fishermen have very much been focussed on volume because, in part, of this governance structure. That means that we are not always making the best use of the TACs and quotas that are available. That has meant that perhaps we are not making the best use of the resources that we do have available to fishermen.

We see that, in competition with Iceland and Norway, we are selling our products sometimes at half the price they are. Those outcomes are not the most desirable, but that is the natural outcome of this kind of governance system.

There has also been an impact on the conservation ethic, when people who have conserved stock, for example, are not necessarily guaranteed the benefit of that effort, that investment, if the stock goes up. We have had a situation where people are being introduced into the fisheries and there is a tendency over time for more effort to be put into fisheries as they go up, and that creates a serious problem when they go down. Crab, possibly lobster, et cetera, have gone through cycles in the past; shrimp has increased in abundance greatly. Whether that will remain, remains to be seen. However, in crab in particular and shrimp, we have introduced many more fishermen in Atlantic Canada.

What has the department been doing about this? We have been trying to introduce new policy frameworks on both coasts. With respect to the Pacific coast, we have the new directions, which has tried to stabilize access and allocation and provide a new consultative process and new policies around the wild salmon policy that is coming out later this year, possibly this month.

In the Atlantic, we had the Atlantic fisheries policy review. That was announced earlier in March by the minister as the Atlantic Fisheries Policy Framework, the AFPR. At that time, he also rolled over 29 fishing plans in order to provide some stability in the access and allocation and to allow us to contemplate further modernization of the governance around the fisheries.

Hence, we are using right now a 19th century instrument in the 21st century to manage a variable quantity of living marine resources.

At the same time, we are facing challenges from other acts. There is the Oceans Act, which us to consider how fisheries will fit into an integrated management plan within large ocean areas and how we will work within those areas in terms of management of oil and gas, ecotourism, aquaculture, fisheries, et cetera.

There is also the Species at Risk Act, which will oblige us to be more conservative as well as to look at the impacts of fishing on bycatch and on the ecosystem itself.

In response to those, we have been moving ahead with a precautionary approach, implementing that in many fisheries. As well, the extension of that is objective-based fish management, where we try to set out our objectives for the fishery, what we are looking at in terms of a conservation limit that we do not want to see the stock fall below. We have reference points within the fishing plan that will allow us to have pre-determined arrangements to make decisions to manage the stocks, in the event that those targets are hit. That would mean that, at the high levels, you have flexibility; and as you see abundance decrease, you would see a more conservation-oriented fishery, to the point where, at some time, you would have to restrict fishing to a great extent.

Not only do we have those pressures on us, but at the same time we are dealing with the governance that essentially puts all decisions on the minister, without fettering his discretion or providing the minister with a process that he has to follow in making those decisions. Minister Regan, when making the announcement in the spring, definitely indicated that he wants to see that changed. He is looking for modernizing the governance around the fisheries and seeking some new tools.

On that, I should also point out that, over the last number of years, we have lost a number of the tools we had available to manage fisheries. At one point, we had sanctions whereby we did not need to take fishermen to court. We could use sanctions to provide the incentives to maintain compliance in the fishery. We could reconcile quotas. If we had an overrun one year, we could use a quota-reconciliation process to encourage people to maintain compliance with quotas by having a two-to-one. For example, if you overrun this year by 100 tons, next year you will have 200 tons taken off your quota. That is gone; sanctions are gone. Court cases over the past decade have removed all those tools, so the only tool we have now is taking individuals to court.

The other thing that we have seen eroded over the last 10 years or so is our opportunity to enter into agreements with groups of fishermen. Because we cannot fetter the absolute discretion of the minister, it restricts the types of agreements we can enter into with fishermen. That has had another impact on our relationship with fishermen. In the past, we could collaborate, work cooperatively and have an agreed-upon sanctions process within a fishery. Now, we find ourselves in more of a conflict relationship with many groups. The reason for that is that we can only charge; we cannot enter into agreements. The tools we have available are restricted to having fisheries officers build a case and take people to court. Those fishermen that are interested in compliance in their own fisheries are somewhat concerned by the penalty system being applied. Not seeing the adequate incentive for compliance in their fisheries is causing them concern.

All of that has led us to contemplate potential changes to the Fisheries Act, because it is the Fisheries Act that has restricted our ability to find different ways to construct our relationship with fishermen. In this day and age, it is not appropriate in our view to have a relationship that is based on control by government at the very minute level on use of courts and every intervention. We do not have the ability to work together with fleets, communities of fishermen and licence holders to establish with them the kinds of controls they would like to see in their fishery nor to work with them on the types of sanctions they would see as appropriate within their fishery. We cannot have agreements with them relevant to how we manage the fishery, what they will do and what we will do, and how we are going to monitor and control the fishery, including the kinds of decisions they should be taking on their own, not having it all done by the minister.

Those are challenges that we face. The minister will be coming to the parliamentary standing committee with some proposals at some point in the not-too-distant future.

Clearly, right now, in our view, we have a significant challenge based on the fact that we are using 136-year-old tools. We have very few tools with which to work, and those tools have created a poorer relationship with licence holders than we would like. We would like to have a much more collaborative relationship with them. We do not have that. In addition, it has also created an environment that has been poor for conservation outcomes and poor in terms of economic performance of the fishery.

Specifically, we have a number of main thrusts of the AFPR. Conservation is our first priority. That will require us to move ahead with the precautionary approach, setting the conditions for a self reliant industry, stabilizing access and allocation and having shared stewardship. Those are our major thrusts in the AFPR.

On the joint task force report, the Pearse-McRae report, many of those objectives are common to that report. We will be looking at trying to find a way to get the right balance in terms of capacity in the fleet and changing the way we manage the fisheries to get that balance. We want to find new relationships with people in the fishing industry to have them take more responsibility for the decisions that affect their lives.

We are looking at changing the licence policies so that fishermen can actually take out mortgages on licences. That is a major problem on the Atlantic Coast, where we have intergenerational transfer about to take place and where there is no capacity for those who wish to buy a licence to have them properly valued and to have financing in a more transparent way. The Pearse-McRae report suggested changing licences into property by having them issued for a longer period of time.

Numerous other changes were suggested in the report to transfer access from commercial licence holders to First Nations. Also, the report suggested a change to the fishing conducted by both to bring it to a more common approach under one single conservation framework.

In general, that is where we find ourselves. I do not want to use too much more of your time, so I will stop there and open it up for any questions.

The Chairman: Thank you very much. Before I ask Senator Adams to open the question, I apologize for the size of this room. We will try to get a smaller room next time. This room looks like a battleship.

Senator Adams: Mr. Bevan, it is nice to see you again. We have had a little difficulty in the last few years in Nunavut. We get quota every year in Nunavut according to the policy from the minister. I have tried to find out some information in the last couple of years about the two main areas of OA and OB and the area up to Baffin Island. I know that everything belonged to Canada, up to 200 miles, from 15 miles from the shore. We have been operating for the past four or five years in Nunavut according to the policy in the Nunavut agreement.

The minister has set the quota in the OA at 4,000 metric tons of turbot and the quota in the OB is at 1,500 tons. In the last four or five years, those fish have not been caught by Nunavut people. I have a difficulty with that. Why are they giving that quota out to foreigners rather than Canadians?

We do not have any equipment to do it right now. The two governments should be able to find out how to benefit people in the community.

In the future, will we get those quotas for OA and OB? We have been operating for five years and nothing has been happening for those quotas to come to the Nunavut people in the community.

Mr. Bevan: As I understand the situation, we now have a vessel there fishing the quota. It has been Canadianized. It was foreign. It is now a vessel flagged in Canada.

The intention was to have a crew from Nunavut on board. I understand they are having some difficulty in achieving that. A trawler has been moved in to fish the turbot quotas off Baffin Island.

There is also an intention by the group there to purchase a longliner, which might lend itself more to having a crew from Nunavut as well as having the opportunity to have further processing in the area. The intention of the Baffin Fisheries Coalition was to Canadianize their vessels, to bring more employment to the local area and to expand from just the one trawler into longlining.

That would allow actual fishing operations to be conducted by the Baffin Fisheries Coalition and not have it only obtain money by royalty chartering out to vessels from the south.

The minister approved the trawler already. We have heard that there will be a proposal for the longliner. Hopefully, there will be an opportunity for more local employment as those things take place.

I understand they have had difficulty finding individuals to crew the trawler, due to the fact that it is a freezer trawler that takes long trips. That has not been something that many people have been interested in doing, but, hopefully, with the longliner there will be shorter trips and an opportunity to have more Inuit crew and thereby providing local employment.

Senator Adams: In the meantime, ships come in from Europe. They are not Canadian. They speak different languages on those ships from Iceland or Greenland than we do in Canada.

In the meantime, the people on the ship get a benefit from the Government of Canada. What I heard locally is that the workers are treated like slaves on the ship. They are only allowed to go in the cabin with approval; keys are taken throughout the day.

They line up at lunch; the last guys are the Inuit. The crew on the ship do not even speak English. We do not speak Icelandic or Dutch.

The Government of Canada gives out licences to those boats. I do not know how many years, but over $3 million has been spent to train Inuit to be able to fish in the future. We do not have a policy. I do not know how long it takes to get a certificate to learn how to fish — maybe five years.

Every time we want something, we know where the fish is, and we need to eat it. Today, with new technology it is a little different. You are going to operate between 100- to 200-footers. I do not know if one of those Inuit people will own that size of ship in the future. I would like to see something started in the community and the community benefiting. We bring in other ships and foreigners for five years now and there is nothing happening in the community.

They take our fish away. In the meantime, we do not get any benefit from those fish. According to the minister, there are Nunavut quotas. It is not going to Nunavut, the money. If there is going to be Nunavut quotas, if I say I will catch it myself, living in Nunavut, I sell it so much a pound and I make money on it. Right now, we are not doing it.

Mr. Bevan: There is a policy on Canadianization of vessels. That vessel has been flagged in Canada. They have an opportunity to use foreign crew only for a limited period of time, and then they will have to replace the officers on the vessel with Canadians over a short period of time, not more than a year or two. That would then make way for more Canadians to work and also, hopefully, for more Inuit crew.

I cannot speak to the actual management practices on the vessels. That would be something you would have to ask of the Baffin Fisheries Coalition or of others.

However, that is the policy we have. There is a move afoot to try to bring in one more vessel that will be Canadianized, and it will be a longliner, so it perhaps will have a different kind of work environment than currently exists on a factory freezer trawler.

Senator Adams: I believe you know Jose Kusugak at ITK, Inuit Tapiriit Kanatami, who I got an e-mail from yesterday. There is an annual meeting at Rankin Inlet that will finish tomorrow. They proposed that the draggers coming up there in the future should not be allowed to drag in OA and OB. Is it possible to stop that, or how does the department feel about it?

Mr. Bevan: We would have to have a reason for taking that kind of action. Clearly, the Baffin Fisheries Coalition wants to broaden out. They do not want to use only draggers. They are trying to get a longliner into that fishery in order to have a different type of fishing operation.

Sensitive ecosystems — ecosystems that would be damaged by dragging — would be one reason why we would have to deal with that issue. However, in the absence of a reason for doing it, we would not do it.

Having said that, in other parts of Canada we have marine protected areas — MPAs. We also have no-drag zones in the hot channel and parts of the Scotian Shelf because of marine corals, et cetera. Those are issues that are becoming much more of a concern for us. We have to consider the ecosystem impacts of the fishery, and we also have to consider the impacts of the ecosystem on the fishery, in terms of productivity and what have you. We are broadening out our concerns to a substantial amount in terms of looking at not just the target species but also at bycatch and the interaction of the gear on the bottom.

All those are things that are now being considered by the department as a result of Species at Risk study and our obligations to maintain biodiversity.

I do not know of a plan at this point to ban dragging in OA. I do know of a plan to try and find alternative gear.

Senator Adams: Right now we do not have any Inuit-owned, just hooking and gillnet and things like that. For next year, if the organizations say they do not want to have any dragging in their area in OA and OB, is it possible for the minister to say yes?

Mr. Bevan: Right now, we provide the quota to Nunavut via the Baffin Fisheries Coalition. That is how it is being managed. If they do not want to drag, that is their business. That is a local decision that we would not influence at all, if that is the case.

If it is a local decision made by the board or by the groups there, then that is fine. That would be something that they would decide and we would not block that.

Senator Hubley: Welcome to you, Mr. Bevan, and your staff.

I would like to pick up again on what Senator Adams has been speaking of. We have had witnesses who paint not a terribly attractive picture of how the people in the North are able to facilitate opportunities in the fisheries and get the resources required.

I believe they have a vision that the longliner will not necessarily benefit many of their people; they are looking at a smaller fishing vessel but also with the infrastructure to support that vessel.

The other comment is that the Inuit are fishing on these longliners and they are part of the crew. I do not know what government could do to ensure that a percentage of those workers are being trained to take on a more responsible role on those fishing boats. I do not know if there are opportunities for them to do that, but it is something that different witnesses from the North have impressed upon many times in this committee. Would you comment on that for me, please?

Mr. Bevan: Actually, it is difficult for us to get at the internal workings of enterprises, particularly in Nunavut, where we have a relationship with the government of Nunavut and, through that process, they have chosen the Baffin Fisheries Coalition as the vehicle by which they will deal with access and allocation. The Government of Canada has actually taken an arm's length approach to the actual access and allocation decisions within Nunavut. Therefore, we do not have direct involvement in those kinds of issues; in particular, we would not have that kind of control over actual workings of individual enterprises. There are thousands of enterprises throughout Canada. We do not have the ability or the competence to put in place any means by which we could control those types of functions within any individual company. It is really beyond our reach to deal with that kind of question.

One would hope that, by having the decisions made more locally, the local views are being considered. As I said in my introductory remarks, right now, all decisions on access and allocation come out of the minister, with some exceptions. This is one of them. Through the lands claim agreement and through other instruments as well as policy, we have delegated to the Nunavut interests the details of access and allocations of their quotas.

Senator Hubley: From what you said, I gather that you can become more involved in other jurisdictions but that, in the North, that does not seem to be an option; is that correct?

Mr. Bevan: I cannot say for sure. I am not an expert on the details of the land claim agreement, and I do not know that we have actually delegated that function to them officially or formally in law. It has been the practice that we have had, because it is a long way from Ottawa. It is a different set of circumstances. Having us provide advice to the minister on how to allocate in that area just pushes us into an area where we do not feel comfortable about doing that. We do not feel that making those kinds of very local decisions would be a good position to put the minister in.

It is being delegated either through the agreement, which I am not sure about, or through policy. In either case, it is a local decision; we leave it to people who are closer to the individuals who will be affected by that decision.

Senator Hubley: I do not want to belabour the point, but —

The Chairman: If you wish, Senator Hubley, we could invite the Nunavut minister responsible for fisheries to attend here as a witness. I believe his title is Minister of the Environment.

Senator Adams: We have no fish.

The Chairman: That is why we call it the Minister of the Environment. We could invite him, if you wish. Since they are given this responsibility, we could discuss it with him if we invite him as a witness.

Senator Hubley: Thank you very much. Because this committee is dealing with Canada and with all regions of Canada, it has to look closely at what is happening in northern Canada.

I am perhaps not looking for the answer today, but if we felt there were a situation in the North that we would like to look at a little closer, how would you suggest we would go about it?

Mr. Bevan: In the North?

Senator Hubley: Yes, around that situation that I have just described.

Mr. Bevan: It must be dealt with, I would hope, through the Government of Nunavut. I think their relationship with the Baffin Fisheries Coalition is the key to that. I know you have heard witnesses from those groups in the past, but they are the ones who are currently allocating their quotas. That is where the decisions rest at this moment. If you wish to talk to them directly, I am sure that they would be more prepared than I am to explain their decisions.

Senator Hubley: Would they also be responsible for infrastructure?

Mr. Bevan: No. That would rest with the Government of Canada in terms of harbours, et cetera. That would rest with my colleague, the ADM of Corporate and Human Resources in DFO.

Senator Meighen: Mr. Bevan, by way of background, perhaps you could help me, although I assume this information is on the public record. Budgetary concerns would surely impact on the implementation of a new policy framework for the department. Am I incorrect in thinking that DFO's budget over the past, let's say, five years has been in a state of fairly serious contraction?

Mr. Bevan: I am not sure we can call it contraction.

Senator Meighen: Reduction.

Mr. Bevan: We definitely have a serious problem in DFO. We have a situation where we have an imbalance in terms of the amount of operating money that we have versus staff, et cetera, so we need to try to get our fiscal house in order to make ourselves more efficient and operate more effectively with the resources that we do have.

In the event that we were to go ahead with these policy changes, when you look at sanctions versus going to court, they are much more efficient in terms of getting compliance. You do not need to spend a lot of money hiring lawyers, presenting cases before courts and having outcomes that are quite uncertain and penalties that are subject to a decision of the judge but not necessarily reflective of the values and views of the community relevant to the problem that was being dealt with. Sanctioning would be a lot less expensive than the current process.

If we had a more collaborative relationship with fishermen, if we had a situation where we had the opportunity to enter into agreements with them and share stewardship of the resource, that again would help us stretch the dollars considerably compared to current arrangements where we have to do it all because we cannot enter into the types of arrangements that would help us jointly work with fishermen because of the Fisheries Act.

The new policy framework actually provides an opportunity to try to get our budgets better lined up and to then have more opportunity to focus on high-priority areas that would not be covered by these types of agreements with fishermen, groups, communities and First Nations, and that would not be subject to other types of compliance arrangements. We would be able to concentrate our enforcement efforts on poaching rings and organized illegal operations, et cetera. We would be able to concentrate our discussions in a more positive way instead of refereeing between competing groups of fishermen and finding ourselves the meat in the sandwich in that kind of conflict. That is what we spend a lot of our time doing now. It is not the best approach. If we could provide a different set of legal instruments, we probably would have a lot less of our fiscal and financial headaches.

Senator Meighen: It sounds eerily reminiscent of the challenges faced by the Department of National Defence in getting more teeth into the armed forces and out of the administrative side of their responsibilities and out into the field. It sounds like it is, in some ways, similar to the challenges you are facing.

Mr. Bevan: That is a fair analogy. We had a fair amount of B-based budgets, sunset money that was used to help our operations over the past five or ten years. That is now gone. That has left us with a cash problem in terms of operating funds that we have to now rectify.

Senator Meighen: These funds were for specific programs that are now sunsetted?

Mr. Bevan: That is correct.

Senator Meighen: I do not want to flog this — well, I will flog it anyway, mercilessly. If someone were to ask you the following question, what would be your answer? Have your total budgets available for your work gone up or down in the last five years?

Mr. Bevan: They have gone down, and will be going down again in the near future, with the sunsetting of some of the funds that were used to deal with the Marshall response and some of the other funds that are sunsetting over the course of the next year or so.

Senator Meighen: I am encouraged by what you say in terms of freeing up funds to get them out into the field, so to speak. My anecdotal evidence is that the number of protection officers, for example, has diminished quite radically over the last few years. Is that an area in which you might be able to put some funds back?

Mr. Bevan: We have a real concern about operating funds for fishery officers; there is no question that that is a problem. I should point out that we have more officers now than we had five years ago, as a result of expanding our presence in habitat enforcement, et cetera. We have, however, had a problem with resource crunch in terms of operating money. We have officers who are highly trained, they have equipment, vessels, et cetera, but they do not have enough operating money to make the best use of it. For that reason, we stopped hiring new officers over the last two years — which means that we are seeing an attrition of about 50 out of 700 or so in the country.

Having said that, the real reason people say there are fewer officers is that they are not out on the water as much as they could be if we had proper operating funding for them. Hence, they are not as visible as they otherwise would be. That is a challenge we are grappling with now. We intend to fix that. A significant amount of money has gone to field units this year. Unfortunately, it is again B-based money; it will not be there forever. We are looking at conducting reviews of how we manage ourselves in terms of fisheries and aquaculture management and how to free up the funds to keep the frontline people working.

Senator Meighen: Another area where anecdotally I direct your attention is the river fishery in Atlantic Canada, where the number of wardens in Newfoundland, New Brunswick and similar provinces has gone down dramatically. The level of poaching has gone up quite dramatically, as a consequence. I hope that that can be attended to at the earliest possible opportunity.

Mr. Bevan: We have seen an increase in the number of fish coming back to rivers in Newfoundland, in particular.

Senator Meighen: That is why there is an increase in the number of poachers.

Mr. Bevan: Unfortunately, the more fish, the more poachers.

Senator Meighen: Exactly. More fish, more poachers and fewer wardens is a recipe for serious problems; is that right?

Mr. Bevan: That is right. What we did in Newfoundland is move from having people on the rivers on a continuous basis doing low-level enforcement to having a more highly trained group to target particular problem areas. We have seen a significant number of charges laid in Newfoundland by federal fishery officers, and we have also been working with the new provincial wardens as well. There has been lots of enforcement and results, but we have not made that story available.

Instead of knowing somebody is out there in the middle of the night as part of a team looking for organized poaching rings, the perception is that the person who was there in the daytime all the time in the past is not there. There is a perception that there has been a drop in enforcement, when we have changed the enforcement more than dropped it.

Senator Meighen: Mr. Bevan, you have some convincing to do with respect to the Premier of Newfoundland. He set up his own provincial enforcement team on the grounds that he has to do the work that you are mandated to do.

Mr. Bevan: I understand that. That is definitely the case. However, the vast majority of the charges still come out of federal officers. I do not have the numbers in front of me.

Senator Meighen: No doubt, because this team has only been just set up.

Mr. Bevan: We do work with them and we have had collaborative enforcement activities with them. We certainly welcome these measures and hope that will continue. I do want to point out, however, that we changed how we did our enforcement more so than reduced it significantly. We changed it to make it more effective in terms of getting at the organized poaching rings.

Senator Meighen: Mr. Bevan, I heard you say that one of the challenges with the Fisheries Act is that so much decision making is thrown onto the lap of the minister. Would the licensing of a new fishery be a ministerial decision?

Mr. Bevan: Generally, yes.

Senator Meighen: Just to get all my cards on the table, the fishery I am thinking of in particular is the 10-ton Labrador fishery that was licensed last fall to a group that called itself a Metis group and was given this 10-ton interceptor fishery that seems to fly in the face of the precautionary approach of your department and perhaps against our international obligations.

Mr. Bevan: This is not necessarily a new fishery, but a different way of managing the previous fishery. There was an all-residents food fishery in Labrador that was intercepting a small amount of salmon in Labrador. This is now a means by which we can manage it under a different control mechanism. There has been a fishery there for a number of years. This is the same type of interception, but managed in a different way.

We do have an obligation under the North Atlantic Salmon Conservation Organization to manage fisheries, in particular, to try to limit the interception fisheries. We have two that are remaining. The first is off Greenland, and is 10 to 20 tons a year; and the second is off Labrador and has historically been 8 to 10 tons a year. That has been well known to our international partners. It is a subsistence fishery and that has not been a major problem for the international partners.

We have eliminated all commercial fishing, not only in Canada, but also in Greenland. There has been progress made. It is for those reasons that we have seen some increase in the returns to some rivers in the northern parts of Atlantic Canada. There has been no real success, unfortunately, in southern rivers, the Bay of Fundy or the Nova Scotian rivers along the South Shore. Those are all in serious trouble due to acid rain and unknown factors for the Bay of Fundy.

We have taken steps to limit these fisheries in the past. What we did this time was move from the all-residents arrangement to a communal licence as the means to control that fishery.

Senator Meighen: Do I understand you to say there is no net change?

Mr. Bevan: That was our intention, not to change the volume. If there were to have been less fish caught in the all- residence fishery, 8 to 10 tons has been the range. If it were eight tons, and these fishing opportunities this year end up with 10 tons, then it might be two tons more, or it could be the same. There was less control on the volumes in terms of the all-residents fishery than there would be under a communal licence.

Senator Meighen: Does this take into account the allowed incidental catch in the sea trout fishery?

Mr. Bevan: I am not sure of that. I would have to come back to you with a written response to that question.

Senator Meighen: I will close on that note.

By way of editorial comment, Mr. Bevan, I think the increased returns of Atlantic salmon in the last two years are due, in large part, to the buyout or the moratorium on the Greenland fishery, which was financed by the American government.

Mr. Bevan: We made it clear on that point that Canada does not pay foreign fishermen to stop fishing. We do not pay the commercial fishermen in Newfoundland for their lost opportunities. We find the best way to deal with that is through the international negotiations and through NASCO. That is our position on that issue. Greenland and Denmark have an obligation to control their commercial fishing. That is their responsibility. It is not appropriate to pay fishermen not to fish in that kind of way. However, having said that, certainly it may be yielding results.

The other issue that may be improving is at-sea survival for those stocks that are farther north. We are not having good success in the southern rivers.

[Translation]

Senator De Bané: Mr. Bevan, I have carefully reviewed the document published by the department announcing the fisheries management strategic framework. This new approach to encouraging users to participate in the management of the fishery is very intriguing.

[English]

I understand that there will be a second stage in that policy framework related to the implementation. Have you looked into the issue that has been studied by the Senate of Canada about privatization and quota licensing? Has that been done?

As you know, this committee, under the chairmanship of Senator Comeau, published a study on the question of individual quota. Does this first volume deal with the issue of individual quota, or will you not touch on that?

Mr. Bevan: I would not suggest that we will not touch it. We are looking at a means to enable groups of fishermen to make choices on their own. We do not necessarily say that we want a cookie-cutter approach, a one-size-fits-all approach, and move everyone to ITQs or to IQ fisheries. Certainly, in those fisheries, such as in the Pacific — halibut, black cod fishery — and some of the fisheries in Atlantic Canada that have gone through ITQ they have been economically successful. They have the right balance in terms of capacity to resource. They have an efficient operation. It has, however, had an impact on total employment and participation.

Those are not necessarily choices that we want to make on behalf of anybody. We would like to enable people to make their choices. That may mean that fleets or communities may wish to place significant limits on the kinds of concentration that could take place, or may not wish to go down that path at all. It is not for the Government of Canada to dictate to a group of people, whether it is a First Nations group or commercial fishermen, how they should proceed. They should have the flexibility to proceed if they generally agree that this is a better way to manage the fishery.

From our perspective, ITQs have been a cheaper process for the Government of Canada to manage. There is much less conflict and confrontation over those kinds of fisheries, but they are not for everyone.

There is a second phase to take place. It will be much more complex, in that there will be many different decisions that people would like to take relevant to their own fishery. Some may wish to remain competitive fisheries; others may wish to go to IQ fisheries; some may wish to go to limited opportunities to amass more licenses or more quota per licence; and others may wish to go to ITQ. Should we allow people to determine their own destiny or should we dictate what it is? We are leaning towards allowing people to make their own decisions.

Senator De Bané: The objectives of the department for the Atlantic fishery are definitely very laudable. However, one cannot escape the notion of having the Department of Fisheries and Oceans, because fisheries is the backbone of the economy of many communities in Atlantic Canada. In fact, there is no alternative employment for many of these communities.

The department has taken on itself the responsibility to act as the employer of last resort. That has permeated the philosophy of the management of the department for decades.

If I am right, the Government of Canada and the Parliament of Canada have never said to the Department of Fisheries, ``You are the employer of last resort and that should be the underlying strategy of your department.'' We see in your document that, essentially, the mandate of the department is to manage the fishery, but it could not avoid taking stock of that reality, that it is employer of last resort, and the only one and no alternative employment.

That must be, to a large extent, an impediment to the transformation of that sector. If I look to the other renewable sector, agriculture, we see that one of them has become very much market, customer and quality oriented. The other natural resource sector, fisheries, has not yet attained the sophistication of the agricultural sector.

One hundred years ago, 80 per cent of Canadians were living on farms. Today, barely 1 per cent feeds the population, but they have modernized. The Department of Agriculture has never taken under its responsibility to be the employer of last resort and have that philosophy colour the management of the sector.

I do see forcefully presented in your document the idea that you want to have fishers involved in the management, that you want to do it in the most efficient way. At some point, there is a contradiction between social distribution and economic growth. There is definitely contradiction at some point.

I had the honour of being the Minister of Fisheries. I remember that the department in those days was very resistant to the idea of factory trawler quality. They said: ``No, there is so much unemployment onshore. We will not allow that. As long as there is unemployment, we will not allow factory trawler quality, even if it is the highest standard quality for consumers'' — highest quality because you gut and fillet the within a few minutes.

The philosophy was yes, we should that, but on the other hand we have another responsibility. The department has been torn, particularly in Atlantic Canada, with those constraints. They do not have those constraints in the New England states because there are alternative employment opportunities.

Can you be candid with us? Tell us to what extent your objectives are, on the one hand, to have a modern fishery and, on the other hand, to observe that other imperative of taking care of people who, unfortunately, have very limited alternative employment opportunities.

Mr. Bevan: Your observation is accurate. If we look at the differences between British Columbia and Atlantic Canada, we see more ITQ fisheries, more focus on maximizing the value, market-driven fisheries, and much maximizing of the efficiencies. We have fisheries there that work well from our perspective, as well as from the fisherman's perspective, in terms of joint stewardship, et cetera.

It seems that it is always easier in terms of fisheries management to maximize a couple of things. You can have economic efficiency, ecological sustainability, community sustainability and institutional sustainability, but it is difficult to have all four maximized. If you maximize the ecological and economic efficiency, you have fewer communities and fewer institutions such as some that we have now. That is a tremendous stress on what we are trying to achieve, particularly in Atlantic Canada.

There is no question that we have had a number of decisions made over the years that have leaned toward maximizing participation. We have introduced more licence holders into crab fisheries and into shrimp fisheries, and that is a manifestation of a desire to maintain communities and to maximize employment.

At the same time, in particular, the shrimp fishery is performing poorly because of the fact we do not have economic efficiency. We do not have the quality that the market has been looking at in all cases — not everywhere, but there are some issues there, and that has been brought out in a number of reports done by the Government of Newfoundland on some of their fisheries.

We recognize there are problems. The policy we have is talking about trying to provide opportunities to solve those problems, but not saying that everyone has to move at the same pace all at once.

We need to make sure that conservation is really the first priority and that we do not bend to pressure or make access available by keeping quotas close to the edge. We need to make that real by introducing the elements of the precautionary approach into fishing plans, so that we know where we are relevant to the abundance and how much risk we are taking, and that we manage the risks reasonably. That has to happen regardless of how we fish and how we allocate, but it is easier to do in some cases than others.

We need to provide opportunities for the people to make their own decisions relevant to whether they want to move quickly toward economic efficiency, or more slowly due to the social concerns that might exist. We are being pulled in two directions: to try to make the fisheries economically sustainable and have viable enterprises, and to maintain coastal communities.

Fisheries also has more participation than it otherwise would due to fisherman's EI. That has been another factor that has maintained more participation that could be supported by some of the stocks that are there.

It is a big challenge. We do not have a clear policy in the department or the government that states the objective of making wealth and having it generated in a sustainable way, or the objective of making employment, again, hopefully, in a sustainable way. We do not have that clearly laid out, nor are we seeking it in this case. What we are looking at doing is saying to groups of licence holders, ``Let's try to have you make choice; if you want to move toward economic efficiency very quickly, that should be a choice that you and the communities make — the communities that you live in and that rely on the employment.'' However, if not, if they want more participation, we have to allow some flexibility there.

Candidly, if we were to say to everyone tomorrow, we are all moving to ITQs as property rights and to heck with coastal communities, it would not be doable; nor is it appropriate to say that no one is allowed to go down a path, even if they want to, that allows some improved economic efficiency. That is not sensible either. It would be good if we can look at it as enabling groups of people to make the decisions themselves, and to deal with those kinds of decisions at the local level and not have them imposed from on high.

Senator Watt: I wish to follow up on what Senator Adams raised and what Senator Hubley touched upon. It is related to the Nunavut Wildlife Management Board.

The wildlife management board, if I understand correctly, received a quota from Fisheries and Oceans, and it is up to that wildlife management board to distribute that quota. Am I correct so far?

Mr. Bevan: That is correct. That is the practice we have right now.

Senator Watt: Where I have some difficulties in understanding is in connecting the Nunavut government with the wildlife management board. It seems to me, from what we have heard from the witnesses, that there were two groups. Originally, they were all under the Baffin Fisheries Coalition. Then, over time, they started to disagree amongst themselves. One was planning for a longer term, that eventually down the road they would acquire a fishing vessel, a trawler, that would have a factory within. That is one school of thought that has been developed by the Baffin Fisheries Coalition.

There is another interest group that was part of that coalition group that said it was not the way it wanted to go because what you are doing, in a sense, is trying to secure a dollar requirement down the road — the capital we will need down the road to purchase a vessel. It might never come around. For that reason, we would like to be acknowledged by the authorities — these are the people that are talking from the communities, saying it would be more beneficial if the quota is allotted to each individual community, at least the ones that seem to be well organized and take on the responsibility.

By saying this, I also have difficulty in regard to whether that is our problem or whether that is your problem. On the one hand, I am not sure what type of relations the Nunavut government has with the wildlife management board, or whether that is the part of the department that is controlled by the environmental department that also assumes the fishery responsibilities.

In a nutshell, what I am saying here is that it seems that the wildlife management board has made up its mind what the role should be for the Baffin development coalition, neglecting the other part of the responsibility. I think Fisheries and Oceans are open to say, and I think you said it, that it is up to the communities, that it is up to the people to decide what percentage should go to the communities and what percentage should to the region-wide institutions.

My question is this: Is that our problem? I do not think so. I think that is an internal problem of the Nunavut government with the wildlife management board — and why they came to us is that there are two ways to look at it. Do we begin to start moving in a direction to gain the benefits of the revenues if the quota is not allotted to the community? They do not want to wait. They do not believe this coalition will be able to succeed in securing the capital requirement down the road to purchase a vessel. This is what I have been hearing from the witnesses. Do you have any comment on that?

Mr. Bevan: As I mentioned early, we have been working on the assumption and on the understanding that the Government of Nunavut has used the wildlife management board as the means by which they would allocate the access to the quotas they have. We have been providing that total quota to them, and they have been the ones responsible for further allocating it out.

There have been decisions made to go to the Baffin Fisheries Coalition. There have been royalty charters there to build up the capital to buy vessels. They are in the process of buying the vessels. Whether that is the right way to go is something I could not pass judgment on. It is up to the local decision makers to really deal with these difficult problems.

I can say one thing, based on my own experience. Access and allocation decisions are always contentious, and there is always someone who is going to find that the decisions made are inappropriate from their own perspective. Somebody may win or lose, and sometimes everyone is upset. I understand the difficulty, but it is something that we do not have the understanding to take on from here. That is why we have gone this route, to provide the opportunity for local decision makers to decide who gets to fish and how it will be fished.

Senator Watt: It is important to this committee to have a clear understanding to what extent Fisheries and Oceans Canada can intervene if they are asked to intervene, to act as a referee between the two groups. I do not think that is what we are suggesting here. I am not sure whether you can do that.

Mr. Bevan: As I mentioned earlier, I am not quite sure of the details around the land claim agreement, so I am not sure to extent we are legally constrained in exercising the minister's absolute discretion in that area. However, vis-à-vis policy, certainly, we just did not feel that we had enough understanding to really get involved in that kind of a process. We have, therefore, delegated it to the Nunavut Wildlife Management Board on behalf of Nunavut.

I do not know if it is a legal constraint or a combination of legal policy. I did not bring someone here who had that kind of expertise, but we can certainly provide that information to the committee.

Senator Watt: My own knowledge in regards to the comprehensive land claims is that the collective notions have a tendency to override the individual's interest. That could very well be the case in this particular area. I do not think the Nunavut Wildlife Management Board should hang tough on the objectives. I do not think they should exclude the individual groups in the community who want to have access with a smaller fleet, because that is something that they know that they can do. If you are trying to fit them into a large vessel, they require retraining and time. It is a long period of time and something they are not used to. I have been in that field before.

The individual's interest definitely must be entertained in that. How you do that by increasing the quota or utilizing the same quota or whether you intervene, I have no answer to that.

The Chairman: Senator Adams, I believe you have a very quick supplemental question.

Senator Adams: Does the Nunavut Wildlife Management Board have to have a licence to receive those quotas from the minister?

Mr. Bevan: That is correct. To fish, you must have a licence from the minister of Fisheries and Oceans Canada.

Senator Adams: Right now, they have a licence to do it?

Mr. Bevan: There is a licence for the vessels that they are using, that is correct.

Senator Adams: I am talking about the Nunavut Wildlife Management Board, not the Baffin Fisheries Coalition, BFC.

Mr. Bevan: The people who fish have to have a licence. People to whom an allocation is provided do not necessarily have to have a licence. There are a number of fisheries where people are provided an allocation and they have to make an arrangement to fish with somebody else that has a licence. I do not know the specifics for the Nunavut Wildlife Management Board, whether they have a licence or not. Clearly, in other areas, we have individuals who hold quota who do not have a licence and have to make arrangements with licence holders to have it fished.

Senator Adams: I heard that the Nunavut Wildlife Management Board has a licence from DFO and are able to receive those quotas. Is that true?

Mr. Bevan: That is a possibility. I do not have the details on that. I would have to get back to the committee with respect to whether or not they have a licence.

The Chairman: You made a very good case this morning, Mr. Bevan, about the fact that you are trying to have DFO respond positively to taxpayers' dollars and so on. I think we sympathize, all of us, with DFO sometimes having a cash crunch. You placed it in a very elegant way, how you have highly trained people sometimes without gas for their vehicles.

Having said that, sometimes the message the DFO sends — and I am going to quote Marshall McLuhan here, that the medium is the message. When I noted that the study on the West Coast was being done by Pearse — I do not know McRae — but when I saw the name Pearce, I said, this is real Marshall McLuhan, because the medium is, in fact, the message. If we recall that Mr. Peter Pearse has been one of the great proponents, as a matter of fact, the grandfather, of ITQs, the message was loud and clear. Had the report been authored differently, we would have had an entirely different message being sent to us.

Is the message that DFO is still, in fact, on a clear path for privatization?

I was listening very carefully to your discussion with Senator De Bané about how you do not have a clear policy, which is what we requested back in 1998, by the way, a clear, consistent policy on privatization. You did indicate at that point that you would be consulting the fishermen and fisherwomen, and the communities, which is something new. That is the key point here. The communities in the past have not been a part of the decision-making process and the agenda as set out by DFO. Will the communities now, in fact, be part of the solution rather than part of the problem?

Mr. Bevan: The Pearse-McRae report resulted from a joint task-force of the federal and provincial governments. We had one person on and they had another person on. Peter Pearse was the choice of the provincial government.

The Chairman: That is interesting to hear.

Mr. Bevan: Clearly, the joint task force report does suggest that there be property rights involved in the fishery. That is a fishery that is under crisis. If we do not change how it is managed for the 2005 fishery, it will likely suffer collective bankruptcy. It is in that serious financial trouble.

The Chairman: I remember the same discussion back in the 1990s in the Maritime provinces, the ITQs, almost the same words.

Mr. Bevan: That is something we have to look at. The trouble in British Columbia right now is that, if we were to open a fishery for gillnetters or seiners, there are so many licence holders that we cannot allow that number of vessels to fish, because we have co-migrating weak stocks and we have to have a much more carefully managed fishing pattern to avoid having people go after the stronger stocks and at the same time damage the weaker. We cannot do that with the number of vessels. If we had all the gillnetters show up, there could be hundreds of them. That is not a possibility in some cases, so we would like to provide an opportunity to have fishing in a more selective way. To do that, we would have to have an arrangement whereby fewer licence holders would be actually fishing, and how would that be done. That is something that we have to consult with the fishermen over the course of the coming winter to get ready for next year.

The Pearse and McRae response was to create ITQs so that you could arrange to have your quota caught by somebody else, or you could sell it to someone else, et cetera. You would have fewer vessels, therefore, you would have more fishing opportunities.

The Chairman: Is it that we have to do this so quickly that you will be discussing this with fishermen and that the communities will not be involved in the process?

Mr. Bevan: In this case, we will hold public discussions. The communities issue came out of the AFPR, where there was a lot of consultation, as you are aware, with Atlantic Canadians. The communities said that they wanted to have some ability to have a say. We had that to some extent in areas close to your home, in terms of community quotas for groundfish in Southwest Nova Scotia. So there are some models that could be looked at.

With respect to the West Coast, we need to find a way to manage the fishery next year on an urgent basis. We are not looking at having people sell out or go to ITQ necessarily. We have to find a way to have licence holders cooperate and work together, so that we can then have some fishing opportunities.

That has happened with the seiners in some locations, where we have had people agree. We have also done that in the herring fishery where people have pooled. You have a requirement to have a number of licence holders come together and then one vessel is used to fish it and it is to the benefit of all.

The Chairman: We may ask Mr. Bevan to come back in the future, because we have only touched on the surface on this. We would like to get some more questions out.

Senator Meighen: Mr. Bevan, your title is I believe Assistant Deputy Minister of Fisheries and Aquaculture Management.

Mr. Bevan: That is correct.

Senator Meighen: You would be aware that one of the criticisms of the Pearse-McRae report was — and the pun is not mine — that fish farming and environment were gutted from the terms of reference. Will the AFPR and any of its stages deal with aquaculture as such and possibly with what some of us perceive to be an inherent conflict within your ministry between obligations to protect the wild stocks and also to manage aquaculture?

Mr. Bevan: Clearly, in my job, I have the responsibility to manage the wild stocks and to manage aquaculture. If we want to look at those two activities, one could say that they are very different. They are different, requiring different skill sets, and different people are generally involved.

However, they have a couple of things in common. They both produce seafood and they both have an impact on the environment. My responsibility is to make sure that both happen in a way that is sustainable, from the point of view of the environment. Therefore, it is my responsibility to work with the provinces, to ensure that there is proper management of the aquaculture activity such that it does not jeopardize the environment or wild stocks, et cetera.

We have to do the same thing — and we have not been doing that on the fisheries side as much as we have to. We have not been looking at the ecosystem impacts of the fishery to the same degree as we have been for aquaculture. Aquaculture sites have to go through a sea of processes. For example, on the West Coast, we are involved in a risk assessment of what the black cod aquaculture might pose for the wild stocks. We do not do enough of that on dragging and even gillnets, longlines, those kinds of things. That has not been the practice to the extent we would like it to be in the future. It has not been the practice in the past, to the level that we need it the future.

We see it in a more common way, in that we have both activities producing seafood and both activities impacting on the ecosystem. We have to manage those impacts so that the activities are sustainable, whether it is aquaculture or wild stocks.

I do not see the same type of conflict. We are not there promoting one versus the other. We are looking at both living in harmony and both being sustainable.

The Chairman: If you do not mind, Mr. Bevan, we will invite you back again in the future. This morning's session was enjoyable and informative. We will try to arrange another meeting in the not-too-distant future. Thank you for being so forthcoming.

The committee adjourned.