Proceedings of the Standing Senate Committee on
Fisheries and Oceans
Issue 2 - Evidence, June 13, 2006
OTTAWA, Tuesday, June 13, 2006
The Standing Senate Committee on Fisheries and Oceans met this day at 7 p.m. to examine and report on issues relating to the federal government's new and evolving policy framework for managing Canada's fisheries and oceans.
Senator Bill Rompkey (Chairman) in the chair.
[English]
The Chairman: Welcome everybody, particularly our witnesses from Fisheries and Oceans Canada, Mr. David Bevan, ADM, Fisheries and Aquaculture Management, and Denis Rivard, Associate Director General, Ecosystem Science. I gather you have been here before.
Tonight, we continue our study of the emerging policy framework, but particularly focusing on crab. We had a session, you will remember, with some of the people in the boats, a useful session in which they identified areas to ask questions about this evening.
Perhaps, gentlemen, you can make some opening comments and then we will have questions.
David Bevan, Assistant Deputy Minister, Fisheries and Aquaculture Management, Fisheries and Oceans Canada: I will keep the opening comments short to allow maximum time for questions. I know you have heard from other witnesses. Therefore, I assume you are familiar with many aspects of the crab fishery.
The fishery is based on a conservation framework, whereby we target only the large male crab in the population and leave all juveniles and females in the water.
In addition, we have protocols to protect the crab that are moulting for the last time. They are moulting into the fishery so they have to be protected; they are called white crab and they have a soft shell. If they are handled, they will have a high mortality. Another part of our conservation framework is to protect those white crab from handling by having the fishery open as early in the season as we can; and by putting in place what are called white shell protocols, whereby in the event we have a high incidence of these white crab encountered in the fishery, we will shut the fishery down.
The Chairman: How do you decide when to shut the fishery down?
Mr. Bevan: We have grids in the ocean. If, in the grid, the incidence of white shell hits 20 per cent of the large males, we shut that grid down. In the event that too many grids are shut down, we will shut down the fishery. It is a means by which you prevent handling of these vulnerable crabs. You target only the males and only enough males so that you leave an opportunity for the males to reproduce before they are captured.
This fishery is also subject to significant cycles of abundance. The peak, for example, in the southern Gulf of St. Lawrence can be up to three times the valley. For example, in the last cycles, we had about 30,000 tonnes at the peak; at the bottom, we had 8,000 tonnes and then back up to 25,000 tonnes or so and down again. Now, we are at another peak. We had 33,000 tonnes and the catch is coming down — there are 30,000-plus tonnes in the Gulf and we are now on the downward cycle.
The fishery is subject to significant variations in abundance, and also significant variations in price. Crab fisheries around the world are also subject to those cycles of abundance. You can have peaks in Alaska and the Russian fishery, and if they coincide with our peaks, price can be an issue. Right now, there are significant pressures on price. As other retailers enter the market, they squeeze the profits out of the value chain between the fishermen and the retail sector. We are seeing a significant decline in price — I am sure people have told you that — as well as an increase in costs.
The fishery is subject to significant changes, and we have to deal with those changes in terms of adapting to them. In the past, that has been done, but it will be more challenging this time out as there are a large number of participants in the Newfoundland fishery and more pressure on the economics of the fishery than we have had in the past number of years.
I believe that is all I need to say in terms of opening remarks. I leave it open to questions for clarification.
The Chairman: Do you want to make some comments?
Denis Rivard, Associate Director General, Ecosystem Science, Fisheries and Oceans Canada: Yes: Maybe I can say a few words to situate you in terms of the science in the department. In particular, I can speak in relation to the snow crab fishery, since this topic interests you.
Snow crab science is the same as the science done for other species, and we try to apply the same model across the country.
Data is collected by scientists and also by fishermen themselves. That information is brought to meetings where there are not only other DFO scientists at the table but we can invite international scientists sometimes; we can invite scientists from universities; and we also have industry participation — fishermen who are invited to explain the data, what they see in the field and so on.
These meetings lead to formal advisory reports that focus on the stock's status and provide recommendations on conservation issues — on catch levels that are acceptable, given the state and condition of the stock. These meetings are thoroughly documented. They are documented on websites on a regular basis; and, usually, these assessments are annual.
For snow crab, in particular, I am sure that you have learned there are many sources of information. Catch rates, or the information from the fishermen's log book are used as an indication of the performance of the fishery. We also have post-season surveys; and in some cases, when we can afford it, we have trawl surveys.
Trawl surveys are interesting as they allow you to pinpoint more accurately how much there is on the ground. Most recently, we have been able to expand some of the indices we have. For example, in the Newfoundland stocks, where we had only catch-rate information, which is only a first level of information on the stocks, we were able to involve the fishermen in post-season surveys. Over time, we hope this information will improve the quality of our assessments.
As a last word, I want to indicate that we are in evolution as a science group. We have to respond to emerging issues. The nature of the work now is different than what it used to be.
We face a number of questions with respect to ecosystems and biodiversity. Species at risk, for example, are a consideration now that we must put in our assessments. Invasive species can be another aspect, as well. As we evolve as a group, we have to answer not only traditional management questions, but also questions from a wide variety of stakeholders.
Finally, in terms of the way to do business, collaboration is the key — collaboration with the industry, both in trying to involve them in collecting data and assisting in surveys, for example, but also involving them in analyzing the data and discussing results. At the end of the day, the industry will not subscribe entirely perhaps to the results because they affect their business quite a bit, but at least they have a chance to be there, question the science and see the evolution in how the advice is arrived at.
Senator Comeau: I have a few questions, some of which might not seem related. First, the Fisheries Resource Conservation Council, FRCC, issued a report on the crab industry about a year and a half ago, wherein it recommended that the advice and involvement of non-licence holders, the people of the community, be sought. Has the department taken this advice as a good possibility — to involve the community?
Mr. Bevan: I think that involvement is also in the Atlantic Fisheries Policy Review framework, where we recognize that interest. Not only the licence holders but other people as well are impacted by the way we manage fisheries.
We have not fully responded to that particular challenge yet. We need to look at new consultative processes to engage communities in the process, but of course we have seen things such as the summit in Newfoundland and Labrador where the premier brought together fishery groups, industry, academics and community leaders to look at how to restructure that fishery, particularly the shrimp and crab, in order to have a sustainable and viable industry in rural Newfoundland. That was one example. We are asked now to consider that approach in other areas, but we have not incorporated it directly into our consultative bodies, the advisory committees and, for example, the crab plans in the Gulf of St. Lawrence or Maritimes this year. Discussions were held with the licence holders directly and we have not yet, in that context, brought the communities into the advisory committee process, but we are looking at other types of consultations to deal with that one issue.
I point out, as well, that when we changed the role of the FRCC to take on more strategic roles in providing advice, I think their first report in that context was on crab and it was important for us and for the FRCC. It was vital that in terms of looking at a fishery that was still in fairly good shape, and looking at what might be done to sustain it and prevent the natural cycles of abundance from becoming too steep and too deep. We received a lot of good advice from the FRCC. A lot of that advice went into play in terms of establishing better protocols in the Newfoundland and Labrador fishery for reduction and handling of white crab, and for improving the management in the fishery from a conservation point of view. It was a useful report indeed.
Senator Comeau: Is there any chance that you can come up with some type of mechanism? Newfoundland and Labrador is the first area that you are looking at for the adjustments. Is there a chance this process can be put into play so that communities can be involved in what will take place shortly in Newfoundland and Labrador?
Mr. Bevan: Clearly in Newfoundland and Labrador there is that chance, as a result of the summit that was held there. That summit was led by the province but with federal participation as well. We are now looking at a federal- provincial follow-up to that meeting. Those problems are not unique to Newfoundland, though. The shrimp fishery in New Brunswick and Quebec is in crisis due to the cost-price squeeze. It is fine to have many thousands of tonnes of shrimp but not if you are not making any money harvesting it.
Senator Comeau: The shrimp fishery in New Brunswick and Quebec are not at the stage, yet, that Newfoundland and Labrador is. That is why I brought up the Newfoundland and Labrador example.
Mr. Bevan: No: the approach is being contemplated but we have not yet taken the concrete steps we did in Newfoundland and Labrador, but discussions are underway with the provinces to follow up with a similar type of session.
Senator Comeau: I am sorry I had to miss the evidence last week, but information came out that — in the report on crab, as well — the FRCC indicated quite a bit of discarding of crab, soft-shelled, undersized or undervalued. I have also associated discard with a kind of a fleet that is geared towards individual quotas, IQs, where throwing it over the side is better than bringing it in because if you bring it in, it is knocked off your quota. Is this the type of fishing that causes the discard because I do not see the value of a discard in another type of fishery?
Mr. Bevan: As I mentioned, we have a targeted fishery that is only for large male crab, so small crab and females have to be returned. Also, white crab is a crab that has just moulted. If you are familiar with lobster, for example, the crab comes out of the hard shell and expands into the new shell. It is soft and it is made up of virtually nothing but a little bit meat and a lot of water. Therefore, it has low value in the market, but also bringing it in is not permitted.
Fishermen are fishing for the mature crab. However, they are throwing back into the ocean the incidental catch of white crab. We have a concern for those crab because they have a high mortality.
Senator Comeau: They will not survive.
Mr. Bevan: No, they will not survive, so we try to reduce their handling and that is what is happening in this particular fishery.
Senator Comeau: I am thinking of the science now. If you do not have a handle on what is caught, including the discards, obviously this situation is not good for your science. Why would they discard? Is there another way?
Mr. Bevan: They have to discard that. What we do, though, is we have a coverage rate for observers. For example, in the Southern Gulf, Area 12, 30 per cent of the vessels are covered by observers and we extrapolate from those 30 per cent to the entire fleet. If we find that the percentage of white crab caught in a particular area is over 20 per cent of the crab then we shut that area down. If too many areas are in that situation we shut the fishery down. We take steps to eliminate the percentage of white crab caught, or reduce it. We also make sure the fishery opens as early as it can to avoid the moulting season.
Senator Comeau: Again on the FRCC, a recommendation was made that there be legislative changes to the Fisheries Act to make it possible for the department to go into co-management, co-partnering or whatever the current phraseology is now.
Why is there a need to change the Fisheries Act to do partnering when, in fact, the department does it now?
Mr. Bevan: We do it with what is called a joint project agreement but there are limits to what we can put into those agreements. There have been changes to the Fisheries Act since it was put in place, but essentially governance around decision-making in the Fisheries Act dates back to 1868. It provides absolute discretion to the minister, with no framework around that, so there are no guidelines on how to exercise that discretion. There is nothing in the law. For example, the law talks about conservation as a priority, but nothing in the law mentions the precautionary approach, and nothing in the law talks about the process to be used in making transparency required. There is no process such as a regulatory process that is in the law.
The minister has absolute discretion with little fettering, and every joint project agreement must have in it that nothing in this agreement can fetter the minister's absolute discretion. That absolute discretion creates limits on how far you can go. The minister cannot be bound by any of our agreements. We cannot enter into a real co-management arrangement where we share responsibility and power with a fleet that is capable of taking on those responsibilities.
The other thing is if you have 80 per cent or 90 per cent of the fleet in agreement with a particular arrangement, we cannot use an agreement with that fleet to force the other 10 per cent to go along. Therefore, we are limited in the kind of arrangement we can put in place with respect to joint project agreements under the current Fisheries Act.
Senator Comeau: As you know, the Fisheries Act amendments have come on a number of occasions. Either the amendment was aborted early or it was passed but with a lot of resistance. A lot of that resistance in the past, as you know, was based on the fact that few of us trusted DFO's word. I take entirely the comments you just made about being able to fetter the minister's absolute discretion, but there was a great deal of mistrust on the part of parliamentarians as to what DFO was trying to achieve. I will give you a quick example of why.
The trust agreement was a perfect example where successive departmental officials came before us and we asked whether there is a separation of the fleet. In other words, investors are not supposed to own a multiple number of licenses and the department answered yes, that is absolutely true, it is a policy of the department. Why is it happening? We are not lawyers. If there is a way of circumventing the policy, it is our policy and so it is there, but if someone has a way to circumvent it by way of legal loopholes obviously there is nothing we can do about it.
In other words, we did not trust the department when the department said something to the effect of yes, we do have a policy and it is applied, but then wink, wink, nudge, nudge, the policy was not being applied because there was a legal loophole.
There developed a mistrust of the department's responses to us as parliamentarians because what parliamentarians needed from the department officials was to say: ``Look, parliamentarians, this is what is happening and this is why we need it.'' Many of us are mistrustful.
Yes, there is the question of fettering the minister's absolute discretion so the minister can go into partnering agreements. However, is there something ulterior to what is proposed?
Mr. Bevan: I think that is clear.
Senator Comeau: In case this issue ever comes back to us again, can you give us an assurance that policy would, in fact, be policy?
Mr. Bevan: The intention was to have the minister's ability to set policy clearly described in the new legislation, with an obligation on the part of officials in law to follow those policies. That change would make the legislation more rigorous, to say the least, because an official who does not follow the policies would be, in fact, potentially in breach of the law, if that is the way the new Fisheries Act were to be structured.
Senator Comeau: If there was a policy of separation, you would not be able to come before us and say, ``Yes, there is a policy and everything is fine,'' wink-wink, nudge-nudge.
Mr. Bevan: We know people are circumventing the current policy. Much work has been done and steps have been taken to the point where we hope, with the minister's approval, to make announcements in the not-too-distant future about changes to the way we administer the fleet-separation, owner-operator policy.
The government has made it clear that it wants to preserve the independence of the inshore fleet in Atlantic Canada. There is no question about that. The difficulty is that people need capital. Fishermen cannot buy the licence of the enterprise without capital. They cannot go to a bank and mortgage the licence because it does not have the status of property. Therefore, they have to find some source of capital. They are getting trust agreements with processing plants that actually control the disposition of the licence. Therefore, the fisherman's name on the licence does not control where it goes. We are trying to resolve that. We hope to do that before we come forward with the proposed legislation. That issue is being considered now by the minister, and we hope to move ahead on that.
If we get the act to a position where we can table it, you will see that it talks about conservation, how decisions are to be made in a transparent way, and the principles to follow in making decisions. The sanctions so necessary for compliance will be reinstated. There will be a much more rigorous process to administer policies, et cetera.
Unlike some of the previous acts where there was fear about what was going on behind the scenes, I hope this act will be more transparent, particularly if we preserve the independence of the inshore fleet.
The Chairman: If I can bootleg several questions, have you considered the model of the loan board in Newfoundland and Labrador for vessels? There was a program; I do not know if it still exists but it was in existence for a long while. Fishermen could borrow from it, buy their boats and pay back the government. There are models that have been in existence for fishers to access capital. Have you considered any of them?
Will you open up the Fisheries Act and, if so, when will you bring it forward? Can we start it in the Senate? We could begin it here and give you a pretty thorough, but rapid, hearing.
Mr. Bevan: The decision on when the act is to be tabled is that of the government and the minister in conjunction with his colleagues. I do not make those decisions so I cannot respond to the second question.
On the first question, boards are provincial instruments. We have looked at preserving the independence of the inshore fleet, not so much with the act but with respect to the licence policies in Atlantic Canada. We are trying to get at the issue of trust agreements.
We are looking at whether we can find a means by which fishermen can go to a bank with the licence and the enterprise to obtain capital. There are some possibilities in that area. That may be something we can announce once the minister is ready to proceed on the policy changes.
[Translation]
Senator Gill: You mentioned the abundance cycle and I imagine you have graphs and patterns to show us. Have you been watching these statistics for a long time? Can you trust the graphs that you have? Do they show the same trends concerning quantity and duration?
Mr. Rivard: The department has been collecting data on the crab populations since the beginning of many of these fisheries. The fisheries in the southern Gulf, for example, began in the late or mid 1960s and we've had information on the catches since the early 1970s.
We began doing scientific studies and the cycle theory began fairly early when we compared our crab populations with others elsewhere in the world. There seem to be two peaks in our southern Gulf populations, which may be called cycles or an extended variation.
There appear to be biological reasons related to the evolving development of females in relation to males, and these cycles are affected by these biological factors. This is documented but is still hypothetical, although it has been noted in fish landings and population trends.
Senator Gill: Are the patterns somewhat similar for the various cycles and how many years do they last?
Mr. Rivard: The cycles seem to last from 10 to 15 years. Once again, these cycles do not really seem to be fixed in time, but they occur over a period of 10 to 15 years. It also appears that, in the southern Gulf, we have just passed a second peak and we are currently headed downward.
Based on the recruitment trends observed, we expect that in the coming years the population is going to decline in the southern Gulf.
Elsewhere in the Canadian Atlantic, it has been noted that in some cases we've passed the peak of the cycle, and that we are heading downward. In such cases, no recruitment has yet been seen, so we cannot foresee the population being restored in the short term.
Overall, if we look at all these trends, the stocks are either declining from their peak or they are already down and recruitment trends have not yet resumed.
Senator Gill: Can you tell us whether the patterns are similar or is it too soon to say?
Mr. Rivard: We wondered, on coming here, whether we could really call this a cycle. We actually have two of these waves but, before we can confirm that they are cycles and how frequent they are, we have to live through several such periods.
Senator Gill: I ask this question because it is hard right now to establish quotas, if ever the government wanted to set quotas for fishers. I imagine that it is somewhat the same for other sorts of fish, such as cod and so on. How do we go about saying that this year so many pounds can be caught if we are not yet sure about production?
Mr. Rivard: The cycles are something that we observe afterwards. To analyze the fisheries, we have annual assessments that attempt to estimate how much crab we really have on the fishing grounds. The predictions we make are not really made according to the cycles observed, but after the fact. We try to assess the abundance from one year to the next and any variations in the abundance.
We also try to make predictions for future years by monitoring and observing future trends in terms of recruitment. The recruitment index enables us to determine peak periods in relation to crab catches. If recruitment is not so good as before, we can expect there to be a downward trend in future years. This is the how the researchers make their predictions.
Senator Gill: You said that the market fluctuates and the prices fluctuate with the market. Are there any monopolies in the crab industry? By ``monopoly'' I mean control exercised by large companies, as occurs in other areas.
Mr. Bevan: This did not used to be so. In the past, however, there were price fluctuations. This was caused by cycles in other places, such as Alaska and Russia.
Today, large companies like Wal-Mart and Costco are on the market and are trying to reduce prices for consumers. Consequently we have to reduce prices for fishers and the fish-processing plants. But it is not really a monopoly.
Senator Gill: It's a trend.
Mr. Bevan: It's a trend.
[English]
The Chairman: Are not talking about buyers and not licence holders or trust agreements?
Mr. Bevan: No, but we take the price on the world market. When a good product comes out of Russia or Alaska, big players in the market such as Wal-Mart put pressure on the value chain, the people between the water and the consumer. Wal-Mart has a tendency, as we have seen with everything from barbecues to televisions, to squeeze the value chain to provide a low price to their customers, and then they control the cost of their inventory. That puts pressure on all of us in this industry.
Presently, we have an unfortunate superimposition of price going down and abundance going down, which is causing a tremendous squeeze, while at the same time, costs are going up.
[Translation]
Senator Meighen: I would like to return to the point raised by Senator Gill. Mr. Rivard, may I assume that you have improved the techniques and methods used to estimate the crab population, for example, compared to what we had 15 years ago for cod? I am no expert. But one of the problems with the cod was that the estimates were not always very accurate.
Mr. Rivard: First of all, the way in which assessments of the snow crab are done is very different from the way in which we assessed the cod. There are some points of comparison, though. Indeed, in the case of both cod and crab, a number of years ago, the only information on which we could base our assessments was, for example, the catch rates from log records. Certainly the catch rates indicate the fisher's performance. However, they do not necessarily indicate any trends in the fish populations. Often fishers have ways of compensating for declining stocks by locating concentrations, for example, so that catch rates remain very good even though the stocks are declining.
In the mid-1980s, if we take the example of the northern cod, the sources of information available were often solely, or almost solely, log records or catch rates. So attempts were made to predict stocks using biased data. By using the catch rates, which tend not to drop although the stocks are declining, we forecast better catches than we should have.
Over time, we tried to improve the science by developing what are called independent research surveys of the way people fish. One of the advantages of these research surveys is the ability to monitor the way in which fishing takes place. Monitoring is done using a standardized net and by setting the time during which the net is in the sea. There are actually all sorts of ways of ensuring that the index obtained is a better reflection of stock trends.
When we manage to combine in an assessment both an estimate based on independent information about the catch, such as a research survey or a survey that can be carried out by fishers in some cases, using a specific protocol, we are in a better position to make predictions. With the cod and several crab stocks, we are now trying to take this direction. In the southern Gulf, for example, for the past several years, we have had an independent catch survey, a trawl survey, which provides an estimate of the biomass on the bottom.
When we do our assessments, we try to follow up on the fishery and the fishery performance. For this, we use catch rates. If there is a discrepancy, however, between the capture rate and what the research surveys show, we begin to ask ourselves some questions. That is when we have to calibrate the factors considered in the research assessments.
Senator Meighen: If the population of a species is declining, I imagine that you begin by closing down the fishery in a certain sector, or you go further and close down all fisheries everywhere. If I am right in thinking this, how do you go about putting in place a permanent solution, that is, reducing the fleet and the number of boats fishing a particular species?
Mr. Bevan: This is a good question for us. Because of the economic crisis prevailing now in fishing, we have to find a way of reducing the number of businesses. There are numerous problems related to costs and prices, and there is also a lack of fishing personnel, especially where crews are concerned. Many people have decided to move to Alberta, for instance. We are now working with the fishers, the provinces, the industry and the communities to find a solution to this problem. We have to change our policies because the fishers are stuck between a rock and a hard place and are powerless to change their situation because of our policies. We will have to work with these people to find a solution designed to change our policies and enable the fishers to reduce the number of boats and businesses. By doing so, I hope that we will arrive at a situation where fishers can earn an adequate living.
Senator Meighen: But we do not have this solution at present.
Mr. Bevan: No. We have begun to hold meetings in Newfoundland, New Brunswick and Quebec. We have to have discussions with everyone affected by these changes and make sure that everyone can make their point of view heard in this discussion of the situation. We have to make sure we produce all the information necessary for the minister to make his decisions with a view to resolving the situation.
[English]
Senator Adams: My question concerns snow crab. We live in the Arctic where there are some crab. I know that in Alaska there are king crabs. I do not know how the situation is in the rest of Canada. I have seen a few crab in Rankin Inlet but they were not that big. I do not know the size of snow crab that fishermen are catching. You say the maximum is 95 millimetres, but I do not know how big in diameter they are.
If they are about the same size as this coffee cup, would that be too small for a snow crab?
Mr. Bevan: That size would be too small for a snow crab. About 95 millimetres is the minimum marketable size. The market likes them larger than that. That measurement is across the carapace. Obviously, the legs are a lot larger.
As I understand it, there are some crab now in Greenland waters. I do not know what the situation is in Nunavut.
Senator Adams: Those who are catching them are not dragging, are they?
Mr. Bevan: No: They use all passive gear. This gear is not the kind where the gear finds the fish; it is the kind where the fish finds the gear.
The Chairman: Are we talking about large pots?
Mr. Bevan: Yes: A lot of steps have been taken in the last few years to make those pots more selective. The target is the large males. Crab fishers do not want to bring up the small crab, the females and the juveniles. They are looking at steps by which they can improve that.
We have more work to do. Certainly, we would like to see that every pot used in Atlantic Canada has biodegradable panels. We have to work on ensuring that is the case so that, if pots are lost, the pots do not continue to fish, because crab are cannibalistic. If a trap is lost and it does not have biodegradable panels, the crab will go into the trap, starve and die after awhile. More crab will go in after them to eat them.
We have work to do, but crab are caught through traps.
Senator Adams: We have crab in the North, but not snow crab. Is there any difference in the water and the depth of the water where they live? We have saltwater in Nunavut. If you go to deeper water, does that make a difference? Those snow crabs are mostly scavengers. They have to live someplace where they can eat. They do not catch other types of food in the water, as mammals do. The crab is a scavenger-type fish, is it not?
Mr. Rivard: Perhaps I can speak for the southern Gulf of St. Lawrence, for example. In terms of the depth where they are found, there is a depth difference by size. The smaller crabs are in shallow water; the bigger ones are in the deep gullies.
Yesterday, in a presentation made to us, I saw that the size distributions are variable. In some years they are found at certain depths in certain areas, while in the following year it is completely different. Their grounds change over time.
There are generally variations like that over the entire distribution. Overall, as you move north and beyond the shores of Labrador, the populations are at the fringe of the distribution of snow crab and you see less of them. They are more variable in terms of abundance.
Senator Adams: You stated that there should be a change in policy for fishing. It is difficult for us in Nunavut. When we settled our land claim, we tried to set up commercial fishing for the people in the community. We used the same policy as the one used in the rest of Canada. When we settled the land claim we thought we would be able to control the fishery by ourselves with the policies that we wanted. However, with DFO policy someone else is doing it for us. We cannot do it by ourselves. We should push for a new policy that is more concerned about the people who have settled a land claim instead of a policy that controls people. We should not hire a company to do it.
Mr. Bevan: Because there is a land claim there, that is a different situation. We have that situation in a number of locations. We receive advice from the Nunavut government through the Nunavut Wildlife Management Board as to where they want the allocations to go. That advice is generally accepted.
The policies I am talking about are the ones in play throughout Newfoundland and Labrador, the Gulf of St. Lawrence, et cetera, which are not subject to land claims or any other agreements. The policies guide the licensing policies for the fisheries so that we can find a way to allow those fisheries to change.
The Nunavut situation is a developing situation. I am not sure how the policies would apply there. We certainly do not want to apply anything to Nunavut that is not suitable to Nunavut. Therefore, we may continue with the practice we have right now, which is to seek advice from the Government of Nunavut and follow that advice.
Senator Adams: The only difficulty is that the Nunavut Wildlife Management Board did not use the land claim agreement. According to the land claim agreement, before any policy in the future concerning commercial fishing occurs, the board must consult the community before they start. They never did that. They have an adviser from the South to do it and that is what the policy is right now. According to the land claim, that did not work. Right now, we need a new act in the fishery and it must involve the people of Nunavut. We need a different policy from the rest of Canada. We have been in the North for so many years that we want to control the fishery. I know how much it will cost for the people in the community, but we cannot do anything about it. We can only control it now by way of a policy change.
Mr. Bevan: We would have to work through the Government of Nunavut and, with them, through the land claim as well. We cannot necessarily assume that what we come up with in the South will be workable there.
Senator Adams: In Nunavut, they do not have a fishery policy.
Mr. Bevan: However, they do provide us with recommendations.
Senator Adams: That is the problem. The policy is only between the DFO and them. The chairman of the Nunavut Wildlife Management Board is paid by DFO. That board makes decisions with the help of DFO. It would be better for us if the board involved the people in the community. That is the only way to do it. The policy was made in 1886.
Mr. Bevan: The law was proclaimed in 1868. It involved only governance on how decisions were made. There have been a lot of policies since then. We have the Atlantic fisheries licensing policy that governs decisions made about who can get a licence, under what conditions, et cetera. That situation is not necessarily what goes on in Nunavut, though, because you have decisions as to how the allocations will take place and who will fish them, et cetera. We do apply policies in the Nunavut area based on Canadian flag vessels and such things, but we do not have the same inshore fishery, obviously, that is guided by the Atlantic fisheries licensing policies that we need to change.
Senator Adams: That is the problem. In the meantime, we have the licence from you that was part of the land claim. However, the people of Nunavut cannot get that licence. Foreigners are getting the allocations and using them.
Mr. Bevan: I understand that situation. Some work needs to be done. The minister indicated that the infrastructure must be looked at as a possibility. As well, there must be a means by which the people can use those allocations and licences. Currently, an allocation is available and the Nunavut government has provided us with the recommendations on how they want to follow it. Under the land claim, we are taking that advice.
The Chairman: I know that Senator Watt has questions but I would like to ask a supplementary question before he begins his questioning.
When Mr. Boland was before us last time, he said that the situation in Nunavut was comparable to situations elsewhere in that there was an absentee ownership that was a real threat to the men in the boats and the people who were catching the quota. I do not fully understand the situation in Nunavut, but he told us that it is not unlike a situation elsewhere where someone other than those in the boats are capitalizing on the fishery and profiting from it. This is a difficulty across the board.
The question then becomes: How do you relate to Nunavut? I am not sure how Fisheries and Oceans Canada relates to Nunavut in the land claims agreement. I am not up to speed on that. There is an across-the-board problem with absentee ownership, which the minister spoke to when he appeared before the committee. He spoke strongly about changing that. The question is: What will we do about absentee ownership?
Mr. Bevan: There are two points to consider. We had a policy in Atlantic Canada that talked about owner-operator fleet separation. The person in the boat is supposed to be the licence holder and generally they are the licence holder on paper. However, a number of trust agreements are behind that licence holder and the trust agreements undermine that particular policy. The licence holder is subject to a trust agreement. The person who financed the enterprise, therefore, has control over the disposition of the licence, rather than the person who is on the vessel or named in the licence. We are looking at changing the way we administer that policy.
There have been many discussions throughout Atlantic Canada as to how to make that change and how to control those trust agreements. Someone can have an arrangement with a plant to accept capital in exchange for guaranteeing to sell fish to that plant, provided the plant does not control the licence, and the individual on the licence has control over the licence. We are looking at changing how we administer that policy. To that end, we have discussed the policy with the various stakeholders, including the provincial ministers. It is our hope that the minister can come forward with an announcement on those administrative changes.
The Chairman: When you say ``shortly,'' does that mean before the end of June?
Mr. Bevan: That is our hope, yes.
Senator Watt: It has been some time since we dealt with the number of licences issued by the department. You must have some knowledge of how many licences are active and how many licences are held by various companies that sit on them and are not necessarily active. Can you provide the committee with the information in terms of the inventory of active fishermen and the number that are inactive?
Mr. Bevan: Yes.
Senator Watt: We also heard from the witnesses that a number of people sit on the licence and do not use the licence to harvest. I do not have much information but that element might be the one to look at because we need that information.
Mr. Bevan: There is a great deal of information on that, although some is based on estimates. For example, we know how many tuna licences are out, that not all of them are used and that a number of people have the licence and pay the annual fee with a view to having some future benefit from it. Some people still hold Atlantic salmon licences, even though there is no commercial fishery. We can give you what will amount to a great deal of information to provide you with an indication of how many licences are out and how many are active, as well as information on the companies.
The Chairman: Do you have names?
Mr. Bevan: We have to be careful in consideration of the privacy law.
Senator Adams: Someone from Florida has a quota of 250 tonnes.
The Chairman: We are talking about a common resource owned by the people but certain individuals have a licence to access and harvest that resource but are sitting on it for gambling, stock market or financial purposes of some kind.
Mr. Bevan: There are many different fishery management arrangements. For example, a person with a tuna licence might not be active but that does not mean that person left the quota in the water. That means that someone else will fish and catch more. They are the ones who decide to be active, and obtain the tuna tags so they can mark the fish they catch.
The Chairman: That is true but there is a principle involved. The minister grants the licence to fish on behalf of the people of Canada but someone else holds that licence. We heard testimony last time that it is impossible to get that licence back to someone who wants to use it.
Senator Watt: There is another area I wanted to ask officials about. What authority does the department have in terms of calling back those licences, if any.
Mr. Bevan: The minister has absolute discretion for the issuance of licences. That discretion has to be exercised within the bounds of natural law.
Senator Watt: What is natural law?
Mr. Bevan: The minister cannot arbitrarily and capriciously cancel someone's licence and give it to a friend, acquaintance or someone else. The minister cannot decide that only left-handed people can fish, or that kind of thing. There are limits on the exercise of absolute discretion.
Senator Watt: When a licence has been inactive for consecutive years, is there a departmental rule that applies?
Mr. Bevan: You could impose that. In Prince Edward Island there are 300-plus licences when they were easy to get. There has been no decision to tell those people that if they do not use them DFO will cancel them. In southwest Nova Scotia that is not the case. There are far fewer licences but a decision was made that only active licences would be maintained. We have seen that happen. However, we call that ``latent capacity.'' There is a potential that someone else could get the licence and increase the capacity. Obviously, there is no tremendous benefit for that to happen because the quota is caught by the people who are active. If we were to expand the number of active licences, then everyone in the fleet would catch fewer fish, would earn less net income and significant problems could arise with the economics of the fleet.
There is some motivation to get rid of the latent capacity because it has many drawbacks. People whose licences were cancelled would certainly be upset on the one hand; on the other hand, there would be no way to increase the percentage of active licences in the fleet if the quota did not have some ability to support that extra activity.
We have very few tonnes of quota held by someone who has not used them in any way, either by fishing directly or, in the case of the larger vertically integrated companies, enterprise allocations that have not used their quotas. One company might trade one species for another species because it fits better with their business plan. Much of that occurs.
The Chairman: Will you put together that list as per Senator Watt's request?
Mr. Bevan: Yes, I will do that.
[Translation]
Senator Gill: Do you know how many licenses are held by people, by the Inuit? Do you have this information concerning the various provinces, the Maritimes, Quebec, Nunavut?
Mr. Bevan: You are talking about the Inuit?
Senator Gill: The First Nations, the Inuit, the Native people.
Mr. Bevan: Yes, we have the number of fishing licenses for the First Nations, but as far as the Inuit are concerned, I am not sure we do, but I think so.
Senator Gill: In Nunavut, at least?
Mr. Bevan: I think so.
Senator Gill: I am talking about the Maritimes and Quebec. Could I have this information?
Mr. Bevan: Yes, of course.
[English]
Senator Adams: I see it a little differently. It ruined the French River. The First Nation had an agreement with the land claim. We were there with Senator Comeau, and we met some salmon fishermen from the French River. They told us they had a licence from Indian and Northern Affairs Canada, set out in land claim at that time. They had 257 individual licenses for the Indians to fish salmon in Prince Rupert, B.C. Nunavut received only one licence, which belongs to the Nunavut Wildlife Management Board.
That is why we have trouble with people in the community. They want to get into commercial fishing, but the Nunavut Wildlife Management Board has the licence Nunavut and they gave it to the Baffin Fisheries Coalition. Right now, some of the organizations and the Nunavut government are competing with the people in the community.
The fishery is run by the Nunavut government and we get the quotas from the Nunavut Wildlife Management Board.
According to land claims, I think you have to hire Inuit to get into business; that is the law. To get into business, the Inuit community has to own 51 per cent of the business. I think it is the same in the fishery as it is in construction work. According to the Nunavut Tunngavik Incorporated, NTI, which is a land claim agreement, businesses have to hire Inuit people in the community — up to 72 per cent — to do the work. If they do not, they do not get the contract. It should be the same thing in the fishery because the money is there, but the people have no jobs. They cannot get into the fishery.
The Chairman: I have a few questions that arose in the last committee meeting that I do not think we have raised tonight. We may have touched on some of them, but one is the whole question of co-management, and how to give fishermen a greater say. Does the Fisheries Act need to change to do that?
You alluded to that earlier with regard to the minister's absolute authority and so on. I guess you have to change the act before you water down the minister's authority. Is that the answer?
Mr. Bevan: I think that is right. Co-management would entail something more than a joint project agreement. A joint project agreement says that the fisherman will do certain activities and pay for it, and the department will do certain things. That agreement is not really co-management. It is not shared accountability for the overall management of the fishery. It is not shared responsibility.
Also, we cannot share authorities if an industry puts in place some kind of monitoring control surveillance and they wish to have an involvement in what kind of sanctions may be imposed on members involved in non-compliant behaviour. That is not possible under the current Fisheries Act.
The Chairman: Do you intend to bring forward amendments soon to deal with that issue?
Mr. Bevan: That again is a decision of the minister.
The Chairman: Have you heard any scuttlebutt, gossip or anything you can share with us? We will not tell.
Mr. Bevan: The minister would be better able to tell you that information. I can only say that I hope to see changes as soon as possible because we really need new tools to work with in the modern context.
The Chairman: The other question that came up was enforcement and science — in other words, having the horsepower to do the job you need to do. We all know that in various ways in past years, the department has been cut back, but there needs to be an increase.
We heard from Mr. Boland last time that there were probably more camera operators in the room than there were people doing scientific studies. Some camera operators offered to go and be scientists but we were not allowed to take them up on that offer.
Can we expect some increase in the budget aimed at enforcement and science?
Mr. Bevan: I can speak for enforcement: Yes is the answer. We have received additional funding for this fiscal year. In enforcement, we have had a situation where a lot of our costs are fixed. We had a squeeze as a result of increasing costs and expenses over the years, and a fixed budget. That meant our operational flexibility was reduced. We ended up with more and more of our budget tied up in offices, salaries, computers, cars, equipment, et cetera and the fixed costs that we were obliged to cover.
Even though we tried to make adjustments and reduced the departments by over 600 full-time employees, we were not keeping up with the pressures. We have now received operational money. It will allow us to place people back into the field. It will allow us the overtime and the operating money to put the fishery officers back into the boats, back on the water, and back out into the field where they can do their job.
Mr. Rivard: On the science side, reductions were announced a few years ago. We were fortunate that in the first year of implementation, there were no reductions to the stock assessment program. There have been reductions this year. About 15 person-years out of about 620 are working in stock assessment.
At the same time, we benefited from money from various initiatives. For example, the international governance program had a science component that will bring about $11.5 million over three years to work on various fisheries- related issues.
With the announcement made recently, there was some money announced with it as well — $1.2 million dedicated toward cod research, with some of that contributed by the Newfoundland and Labrador. In addition, through the Species at Risk Act, SARA, program, some money, about $600,000, goes to cod in particular. It is there for this year to initiate special research projects related to stewardship initiatives, as well as to the impact of other species on cod, for example, seals.
I can name a few others — ocean action plan and invasive species initiatives — that brought new money into the department to deal with specific issues. These types of initiatives help us because we do not need to take money dedicated to stock assessment to cope with these things; we actually have money dedicated to that.
On a day-to-day basis, we work with the minister to identify fisheries research that is a priority for the department and to see how we can move ahead and set up what I will call the future-of-fisheries science in the department. The research will include an ecosystem component and a component of collaboration with the industry.
Again, we should evolve from where we are. We should not repeat the type of program we had in the past, which often focused on single species. We have to evolve from that, and I believe that over time, we will build a program that will be stronger.
Senator Watt: Again, on the scientific side, I am not sure whether the Department of Fisheries and Oceans has been brought up to date in terms of what is happening to the climate change, for example.
I know you are doing the best you can to monitor what is happening in regard to the fishing activities and things of that nature, but on the natural cost of the climate change and the impact on the ocean species, has your department been given an assignment by the minister? Are you moving in the direction of becoming involved and becoming one of the players, as a caretaker of fish?
Mr. Rivard: Climate change itself has been a priority for the department. It is not a subject in which I am specialized, but we do have a group in oceanography that deals with climate change in particular. The group is actively involved in research in that area.
We have been actively following what is going on worldwide, because Canada is not alone in being affected by climate change. We need to work together with other countries. Some of the monitoring required has to be done on a large scale, so we are working with other countries. If you wish to be briefed on this, we have experts in the department who can speak to you about this subject in particular.
Mr. Bevan: I think one thing has changed substantially in the last number of years. Not long ago, fishery managers tended to ask science, what is the number, and what is the total allowable catch, TAC? That was it. Now, we ask a lot more questions such as, what are the population dynamics, how robust is it, and is it sustainable?
In addition, more attention has been paid to oceanographic data and temperature. For example, this year in British Columbia, the model says we will have 17.5 million sockeye back in the Fraser River, and there is a substantive range for what might come back. There is a large spread in that number around that mean.
The next thing that is very much top of the mind for fishery managers is, ``What are the oceanographic conditions? What size are the smelts? What does the productivity of the North Pacific look like? Will it come back around that number? Is it likely to come back lower?'' Those questions are being asked, and we receive reasonable support from science in terms of what we can learn from the scientists relevant to the oceanographic conditions.
Those questions are then considered when we look at the approach we take to management. We have to manage on some kind of number, but we can be cognizant of the fact that it may be subject to significant change as a result of the change in environment.
We see huge differences in the North Atlantic, as well, with certain areas off Newfoundland, for example, showing significant changes in the last 13 years, more than 4 degrees Celsius. What do those changes mean? We do not know. We only know we had better be a lot more careful than we have been in the past, perhaps. We need to try to avoid being pushed to the limits of what can be possibly exploited, and try to leave more room for the unforeseen, because we will have some kind of result that we, at this point, are unable to predict.
Senator Watt: When the minister was before us, I raised the issue of discovering new species. Where are they coming from? What is the reason behind those new species coming into a certain area?
If we have the knowledge to identify where the species came from, then we can go to that particular area and find out. Why are they leaving that particular area? Why are they entering new river systems where they have never been before? This type of information is important because if we do not know, how can we take the next step in terms of scientific study?
You talk about climate change impacting the international community, very true, but you also have to realize the best information can come from right under your paw by talking to local people, establishing a monitoring system and trying to gain a better understanding.
I have heard people say they are doing this monitoring. Why do we never see them? They say they have a research department, but the department does not have the necessary funds to carry out the function.
Mr. Bevan: In Quebec, of course, salmon is the responsibility of the province.
Senator Watt: What is the communication between DFO and the province?
Mr. Bevan: As a result of your last intervention, I have asked the question to be posed to the scientists in the province. We have real problems with invasive species. For example, we have green crab in the Gulf of St. Lawrence. They are not something that migrated. They were brought in by human activity.
Senator Watt: This is why we need to have the information.
Mr. Bevan: They were brought in by human activity, so we have tunicates that are a real problem, causing extensive economic hardship for the aquaculture industry.
Those tunicates did not come in by natural processes. They were brought in by bilge water or people who released them into the marine environment through probably not being aware of the kind of risks they pose. Those problems are significant headaches and we have an invasive species program.
Mr. Rivard: It depends on the level of detail you want, but we have a scientific program now that is looking at that problem. We are in the first year of the program. We have funding for some years. It is likely the beginning. We are working not only within the federal system, but with the provinces.
Certainly, the awareness is there. As Mr. Bevan said, there are many vectors. Part of our research is to understand what these vectors are, what risks are associated with them, and ultimately, what we can do, which is another phase of the research.
All those are key elements of a program that is evolving. There is more and more interest in it because of the economic impacts, and I believe this is only the beginning in terms of research interest in this area, and, as well, how to ultimately manage these things.
Senator Watt: Can information on these programs be made available to us?
Mr. Rivard: We have experts in Ottawa who can speak to you on the various elements of the program, and give you details.
The Chairman: I have one final question. When we heard from the unions across the board — certainly both Newfoundland and Labrador and New Brunswick — wanted to decrease capacity by some form of collective buy-out. I cannot recall whether it was the same in Nova Scotia or not, but the unions in both Newfoundland and Labrador and New Brunswick asked for that.
Is there some way of doing that? Is there a mechanism whereby they themselves can reduce capacity?
Mr. Bevan: There would have to be changes to the policies that govern the licensing of fishermen in Atlantic Canada. In some fleets it is not allowed: it is prohibited for one core fisherman to buy out another. We have fleets in Atlantic Canada who have gone to individual transferable quotas, ITQs. Obviously, they can buy out the quota, and those fleets are predominantly in southwest Nova Scotia, et cetera.
The others do not have those policies, so this year, we allowed what is called buddy-up, where you allow partnering between two enterprises so they can fish both quotas on one boat. As I mentioned earlier, there are problems with shortage of crew and fuel and other costs, so if we can make it available to combine, then we will do that. However, that solution is not permanent. The permanent solution requires a change in policy. Corporate concentration and those types of fears is still a concern. If we change policies, a number of safeguards must be built in. For example, in Iceland the inshore fishery can buy offshore quota but not the other way around, and there are limits on how much quota in particular inshore fishermen can hold in the area they fish. There is a limit of 5 per cent, for example, and that limit allows some control over rationalization but in such a way as to avoid corporate concentration.
We need to gain access to capital for fishermen through policy change. We need to look at working with the fleets as to what kind of concentration they want, how they want to self-rationalize, what kind of circumstances, and how to provide the safeguards people feel are necessary to maintain coastal areas. We need to do so in a way that can be sustained economically during, not a bump in the road but probably, a big shift in the functioning of the fishery for some time to come.
The Chairman: Do you intend to bring forward measures relatively soon on that issue?
Mr. Bevan: We have no choice. Newfoundland and Labrador is looking at that issue square in the face and trying to come to terms with it. We need to get over the fact that we cannot solve this problem with tinkering. We cannot find little adjustments to some of the costs. We need to get at the fundamental structure of the fishery and try to work with the communities, the provinces and the fishermen so we have something that people can live with at the end of the day. We have to start now. As I mentioned, we are already at play in Newfoundland and Labrador and we must start working on the other provinces very shortly.
People are fishing now, but are they making money? Some may not be covering their variable costs so it is not sustainable. We must do something for next year.
The Chairman: If there are no more questions, I want to thank both our guests for taking part in a full discussion. We look forward to the measures you will bring forward. For our part, we will deal with them expeditiously.
The committee continued in camera.