EVALUATION REPORT

EVALUATION OF THE ENVIRONMENTAL RESPONSE SERVICES PROGRAM

PROJECT NUMBER 6B181
JUNE 23, 2016


EVALUATION DIRECTORATE
CHIEF FINANCIAL OFFICER SECTOR
FISHERIES AND OCEANS CANADA

ACKNOWLEDGEMENTS

The Evaluation Directorate would like to thank all individuals who provided input in the evaluation of the Environmental Response Services Program. In particular, the Directorate acknowledges the time and effort of program management at National Headquarters and the Superintendents and Environmental Response staff within the regions who took time to share insights, knowledge and opinions during interviews and site visits.

ACRONYMS

ADM
Assistant Deputy Minister
CCG
Canadian Coast Guard
DFO
Fisheries and Oceans Canada
FTE
Full-time Equivalent
ICS
Incident Command System
ITS
Integrated Technical Services
JCP
Joint Marine Pollution Contingency Plan
MPIRS
Marine Pollution Incident Reporting System
NEP
National Marine Spill Response Exercise Program
NHQ
National Headquarters
OAG
Office of the Auditor General
O&M
Operating & Maintenance
RO
Response Organization
SOPF
Ship-source Oil Pollution Fund
TAG
Training Advisory Group

TABLE OF CONTENTS

EXECUTIVE SUMMARY

Introduction

Included in this report are the results of the evaluation of the Environmental Response Services Program (referred to as the Environmental Response program throughout the report). The evaluation was conducted by the Evaluation Directorate within Fisheries and Oceans Canada (DFO). The main objectives of the evaluation were to examine the relevance and performance of the program, including an assessment of its effectiveness, efficiency and economy. It was an opportune time to conduct the evaluation because a number of initiatives are being explored to improve program effectiveness and efficiency. The evaluation covered the five-year period from 2010-11 to 2014-15 and included National Headquarters (NHQ) and all three Canadian Coast Guard (CCG) regions: Western, Central and Arctic, and Atlantic.

Program Profile

Canada’s Marine Oil Spill Preparedness and Response Regime is a government/industry partnership that was established in 1995. The Regime includes the framework and requirements for preparing for, and responding to, ship-source oil spills in Canadian waters south of the 60th parallel. The CCG forms an integral part of the Regime. It is the lead federal agency responsible for ensuring an appropriate response to ship-source spills in Canadian waters. It does so by monitoring clean-up actions of the polluter or by responding when the polluter is unable or unwilling to take action. In the Arctic, north of the 60th parallel, the CCG provides the primary response capacity.

The main objective of the Environmental Response program is to minimize the environmental, economic and public safety impacts of marine pollution incidents. The main activities undertaken to achieve this objective are providing a preparedness capacity for response to ship-source marine pollution incidents and responding to reported cases of marine pollution.

Evaluation Methodology

A theory-based approach was used for the evaluation. Program performance was measured against intended results articulated in the program logic model. Extensive use of triangulation was undertaken as an analytical method, where multiple lines of evidence helped corroborate findings.

Existing administrative and financial data was analyzed to inform the findings of the evaluation, and supplemented with additional data sources, where required. In addition, the following methodologies were utilized: a review of key program documents and files; a review of relevant audits and recent reports; key informant interviews with CCG program management, partners and stakeholders; a survey of regional Environmental Response personnel; and, site visits to the Western and Atlantic regions.

Evaluation Findings

Relevance

The legal basis and authority for the Environmental Response program is clearly articulated within legislation stating that the CCG is the lead federal agency for all ship-source oil spills or pollution incidents in waters under Canadian jurisdiction. However this leadership role needs to be more clearly articulated by the CCG. The program also aligns with federal roles and responsibilities and the government’s priority of contributing to a clean and healthy environment and sustainable aquatic ecosystems.

The need for the program has increased over time, particularly due to greater environmental awareness, added pressures from new and emerging issues (such as increased vessel traffic in the Arctic, increased transportation of hazardous and noxious substances within Canadian waters, and the need to address the derelict/abandoned vessels), and increasing public expectations that the Government of Canada is ready and able to respond to marine oil spills.

Performance

Overall, the CCG has been able to respond to reported all ship-source oil spills or marine pollution incidents within Canadian waters. However, some issues were identified during the evaluation that may put CCGs’ ability to coordinate a response to a marine oil spill at risk. In particular, some weaknesses with respect to national policy direction, gaps in training and exercising, and risks with respect to pollution countermeasures equipmentFootnote 1 were identified.

The Environmental Response program would benefit from nationally consistent and up-to-date program policies and guidelines. Clear national policy direction is required to ensure regional plans are accurate and reflect national program direction, and would help inform ongoing revisions and improvements to program operations. Further, the CCG needs to articulate more clearly, to its internal and external stakeholders, its role as the lead federal agency when it comes to responding to ship-source spills in Canadian waters.

Training is not consistently organized and delivered across all regions, resulting in gaps. This lack of national coordination creates an imbalance in learning which may result in different levels of awareness, knowledge and preparedness across regions. While exercises help prepare Environmental Response personnel to respond to marine pollution events, there is a need for strategic direction in the development and execution of the National Exercise Plan.

Environmental Response assets and equipment are not managed according to nationally consistent CCG procedures and processes, and the equipment is largely outdated and beyond its supportable life. The age of the equipment continues to be a risk for the CCG, as its level of reliability is unknown.

Resource Allocation

The CCG is funded for maintaining a state of preparedness rather than funded for full program delivery. The CCG must recover costs from shipowners or other bodies under the Canadian Compensation Regime. Currently, the CCG assumes 100% of the financial risk when it incurs costs associated with environmental response operations and in some cases preparedness activities are forfeited to fund response activities and in other case activities planned for the delivery of other programs are forfeited to fund response activities. To date, few incidents have been cost recovered. In the majority of incidents, there may have been no requirement to undertake cleanup or pollution threat mitigations operations, or the value of the claim may be minimal in comparison to the costs and time/effort of submitting a claim (the response required was resolved in one day or less). However, no guidance is in place to determine when cost recovery should be pursued. Regions are responsible for preparing and submitting cost recovery claims. Many key informants noted that a lack of support impacts their ability to submit claims.

The process to submit a claim is cumbersome and when the CCG does submit a claim, it is unable to recover all costs associated with its obligations. ..The Regime on which the CCG relies to fund its response activities is not aligned with current operating realities and public expectations.

Critical Success Factors/Key Barriers

Roles and responsibilities among partners with the Canadian Oil Spill Regime are generally clear and understood. Within the CCG some roles and responsibilities are not clear.

The Environmental Response program has been operating independently from other CCG programs (within a “silo”). Similar to the other CCG programs, the Environmental Response program has experienced a strain with respect to both financial and human resources. However, the Environmental Response program has some unique needs when it comes to financial management, asset management, and training. CCG has not had the capacity to support these unique needs and this places an increased burden upon existing Environmental Response personnel. In spite of this, Environmental Response personnel have been able to respond to ship-source oil spills or marine pollution events. The required level of effort is likely not sustainable over the long-term.

Recommendations

As a result of the evaluation findings, three recommendations have been made.

Recommendation 1: The CCG should put in place nationally consistent policies, directives and documentation that clearly identify the CCG as the lead federal agency for all ship-source oil spills or pollution incidents in waters under Canadian jurisdiction. Ensure program documentation aligns with the national strategic direction on areas such as: mandate and role, training, and exercises.

Recommendation 2: The CCG should put in place measures to ensure that all appropriate claims are pursued for cost recovery. Further, the CCG should document a systematic process for determining when it is most appropriate to proceed with cost recovery.

Recommendation 3: The CCG should ensure the program is provided with sufficient support to address the unique requirements of the Environmental Response program. In particular, ensure that Environmental Response personnel in the regions have the support needed to proceed with cost-recovery claims.

1.0 INTRODUCTION

1.1 Purpose of the Evaluation

This report presents the results of the evaluation of the Environmental Response Services Program (referred to as the Environmental Response program throughout the report). The evaluation was conducted by the Evaluation Directorate within Fisheries and Oceans Canada (DFO). The main objectives of the evaluation were to examine the relevance and performance of the program, including an assessment of its effectiveness, efficiency and economy. In addition, it was an opportune time to for an evaluation to be conducted because a number of initiatives are being explored to improve program effectiveness and efficiency and it was an opportune time for an evaluation to be conducted and findings disseminated.

1.2 Evaluation Scope and Context

The evaluation covered the five-year period from 2010-11 to 2014-15 and included National Headquarters (NHQ) and all three Canadian Coast Guard (CCG) regions: Western, Central and Arctic, and Atlantic. The evaluation commenced in June 2015 and concluded in May 2016 with presentation to the Departmental Evaluation Committee. The report received Deputy Head approval in June 2016.

There is no previous evaluation of this program. However, the program has been subject to various reviews and audits over the last several years. In 2010 both an Office of the Auditor General (OAG) AuditFootnote 2 and a 2010 Internal AuditFootnote 3 were completed. Since 2013 two relevant reviews were completed, namely, the review of Canada’s ship-source oil spill preparedness and response regime (known as the Tanker Safety Expert PanelFootnote 4 ) and the Independent Review of the M/V Marathassa Fuel Oil Spill Environmental Response Operation.Footnote5

2.0 PROGRAM PROFILE

2.1 Program Context

Canada’s Marine Oil Spill Preparedness and Response Regime was established in 1995, and sets out the framework and requirements for preparing for, and responding to, ship-source oil spills in Canadian waters south of the 60th parallel. The CCG forms an integral part of the Regime as the lead federal agency for the response component. The Environmental Response program monitors or manages the clean-up efforts for any ship-source or mystery source pollution incident in waters under Canadian jurisdiction. In the Arctic, north of the 60th parallel, the CCG provides the primary response capacity.

The Regime was built on a government/industry partnership and based on the polluter-pay principle. Industry, as the creator of the risk, bears the liability and responsibility to respond in the event of a marine incident. Under the Regime, industry’s role is carried out through four industry-funded and Government-certified Response Organizations (ROs)Footnote 6 , which maintain a level of preparedness according to Canadian regulations and standards to respond to spills. Prescribed vessels and oil handling facilities are required to have an arrangement with an RO, as set out in legislation. The Government of Canada provides the legislative and regulatory framework for the Regime and oversees the industry’s preparedness and actions during a spill, should one occur.

Where the polluter has been identified and is willing and able to respond, the CCG advises the polluter of its responsibilities. In instances where the polluter is unknown, unable or unwilling to act, the CCG will assume command and control of the response. During response operations the CCG establishes a Unified Command Structure that brings together the provinces and territories, municipalities, First Nations, first responders, scientific expertise, private sector experts and others to ensure a strong response is mounted in as expeditious a manner as possible. Under the Marine Liability Act the CCG can recover the costs and expenses incurred from the owner of the ship responsible for the pollution or from the appropriate domestic or international compensation fund.

The main objective of the Environmental Response program is to minimize the environmental, economic and public safety impacts of marine pollution incidents. The main activities undertaken to achieve this objective are providing a preparedness capacity for response to ship-source marine pollution incidents and responding to reported cases of marine pollution. Since 2008, the CCG has received an average of 1,120 reports of marine pollution each year.

Stakeholders and Partners

An effective response to marine pollution events requires a high level of preparedness, including appropriate resources, thoughtful contingency planning, skilled personnel and strong partnerships. The Environmental Response program is delivered with the following key partners:

  • CCG Programs and Fleet;
  • DFO sectors;
  • Other Government Departments such as Transport Canada, Environment Canada, and Public Safety Canada;
  • First Nations;
  • ROs; and,
  • Foreign Governments, such as the United States Coast Guard.

Given its role of ensuring an appropriate response to ship-source and mystery-source pollution spills in Canadian waters, the primary client for the Environmental Response program is the Canadian public.

Below is an overview of program resources, by region, from fiscal year 2010-11 to 2014-15. Expenditures include all Operating and Maintenance (O&M), Salary and fuel costs, and also accounts for Vote Netted Revenue.

Table 1: Overview of Environmental Response Program Expenditures and FTEs, 2010-11 to 2014-15
2010-11 2011-12 2012-13 2013-14 2014-15
Region Expenditures FTEs Expenditures FTEs Expenditures FTEs Expenditures FTEs Expenditures FTEs
Atlantic 3,078,043 32 3,405,259 31 3,305,830 29 4,729,700 27 5,993,635 28
C&A 3,435,778 27 3,390,182 27 3,426,914 28 3,314,603 26 7,876,619 25
Western 1,834,651 15 1,615,906 14 2,432,223 13 25,137,866 22 2,737,184 17
NCR 1,288,827 9 1,392,046 9 1,562,766 9 554,305 4 1,009,926 5
TOTAL 9,637,300 83 9,803,392 81 10,727,732 79 33,736,474 79 17,617,364 75

Table 1 shows an overview of the Environmental Response Program Expenditures and FTEs, from 2010-11 to 2014-15, by region. The table has 7 rows. The first two rows show headings, with the top row dividing the columns by fiscal year and the second row showing headings for “Region” and then “Expenditures” and “FTEs” for each fiscal year. Row 3 shows expenditures and FTEs for the Atlantic region. In 2010-11 there were $3,078,043 in expenditures and 32 FTEs. In 2011-12 there were $3,405,259 in expenditures and 31 FTEs. In 2012-13 there were $3,305,830 in expenditures and 29 FTEs. In 2013-14 there were $4,729,700 in expenditures and 27 FTEs. In 2014-15 there were $5,993,635 in expenditures and 28 FTEs. Row 4 shows expenditures and FTEs for the C&A region. In 2010-11 there were $3,435,778 in expenditures and 27 FTEs. In 2011-12 there were $3,390,182 in expenditures and 27 FTEs. In 2012-13 there were $3,426,914 in expenditures and 28 FTEs. In 2013-14 there were $3,314,603 in expenditures and 26 FTEs. In 2014-15 there were $7,876,619 in expenditures and 25 FTEs. Row 5 shows expenditures and FTEs for the Western region. In 2010-11 there were $1,834,651 in expenditures and 15 FTEs. In 2011-12 there were $1,615,906 in expenditures and 14 FTEs. In 2012-13 there were $2,432,223 in expenditures and 13 FTEs. In 2013-14 there were $25,137,866 in expenditures and 22 FTEs. In 2014-15 there were $2,737,184 in expenditures and 17 FTEs. Row 6 shows expenditures and FTEs for the NCR region. In 2010-11 there were $1,288,827 in expenditures and 9 FTEs. In 2011-12 there were $1,392,046 in expenditures and 9 FTEs. In 2012-13 there were $1,562,766 in expenditures and 9 FTEs. In 2013-14 there were $554,305 in expenditures and 4 FTEs. In 2014-15 there were $1,009,926 in expenditures and 5 FTEs. Row 7 shows total expenditures and FTEs for all regions. In 2010-11 there were $9,637,300 in expenditures and 83 FTEs. In 2011-12 there were $9,803,392 in expenditures and 81 FTEs. In 2012-13 there were $10,727,732 in expenditures and 79 FTEs. In 2013-14 there were $33,736,474 in expenditures and 79 FTEs. In 2014-15 there were $17,617,364 in expenditures and 75 FTEs.

Source: Business & Resource Management, IBMS, CCG

2.2 Logic Model and Performance Measurement

A Performance Measurement Strategy for the Environmental Response program was developed in May 2012. The logic model was revised for the purpose of this evaluation, with input from the program . It provides an overview of the logical linkages between inputs, activities, outputs and various levels of outcome.

Performance data, as outlined in the Performance Measurement Strategy, was not fully available to assess the outcomes as stated in the logic model and as a result, the quality and usefulness of the performance information was not measured. In addition, the evaluation found differences in regional procedures and data collection which impacted the reliability of the comparison of some incident data across regions.

3.0 EVALUATION METHODOLOGY

3.1 Evaluation Approach and Design

A theory-based approach was used for the evaluation. Program performance was measured against intended results articulated in the program logic model. Extensive use of triangulation was undertaken as an analytical method, where multiple lines of evidence helped corroborate findings.

The evaluation questions covered relevance and performance, including effectiveness, efficiency and economy. The evaluation questions were determined on the basis of the Treasury Board’s Policy on Evaluation (2009), a review of key program documents, and results from preliminary discussions with key program personnel, and findings and recommendations from previous audits and reports (listed in Section 1.2) were considered.

3.2 Data Sources

Existing administrative and financial data was used to undertake the evaluation, and supplemented with additional data sources, where required. Specifically, existing program expenditure and human resource information was analyzed, as well as any existing performance data where it was available, and data from the Marine Pollution Incident Reporting System (MPIRS).

In addition, the following methodologies were utilized:

  • Review of key program documents and files;
  • A review of relevant audits and recent reports, including submissions to the Tanker Safety Expert Panel;
  • Key informant interviews with CCG program management, staff, and partners within NHQ and the regions (n=24), CCG senior management (n=8) and program stakeholders (n=4);
  • A survey of regional Environmental Response personnel (n=36, response rate = 60%); and,
  • Site visits to the Western and Atlantic regions.

3.3 Methodological Limitations and Mitigation Strategies

Some challenges and limitations were encountered, outlined below. However, these were mitigated as much as possible through the use of multiple lines of evidence and triangulation of data. This approach was taken in order to demonstrate reliability and validity of the findings and to ensure that conclusions and recommendations were based on objective and documented evidence.

Table 2: Limitations and Mitigation Strategies
Limitations Mitigation Strategies
Limited performance measurement data Limited performance data was available to assess program outcomes. To mitigate this, the evaluation relied on other data sources such as interviews, documents and findings from recent audits and reports.
Regional variances in the recording of incident data in the Marine Pollution Incident Reporting System (MPRIS). Differences in regional procedures and data collection impacted the reliability of the comparison of some incident data across regions. The biggest variations can be seen in the recording of level 1 and 2 incidents. To mitigate, where warranted, incident data relating to level 1 and 2 incidents was removed for analysis. Where this occurred, it was noted.
Limited consultation with external stakeholders There was limited consultation with external stakeholders. To mitigate this, the evaluation analyzed all submissions received for the Tanker Safety Expert Panel.

4.0 FINDINGS

The program’s relevance was assessed by examining the current need for the program and its alignment with government priorities. An assessment of the program’s effectiveness was determined based on the extent to which policies, directives and guidelines were in place to support a nationally consistent approach to program management, evidence that program personnel were prepared to respond, and evidence that equipment was operationally available and ready. Finally, an examination of the allocation of resources and evidence of cost recovery was undertaken.

4.1 Relevance

Alignment with Government Priorities and Federal Roles and Responsibilities

Key Finding: The Environmental Response program aligns with Government of Canada and federal government roles, responsibilities, and priorities.

The legal basis and authority for the Environmental Response program is clearly articulated within Part 8 of the Canada Shipping Act, 2001; the Oceans Act; the Marine Liability Act; the Constitution Act, 1867; and, by virtue of an agreement with Transport Canada, the Arctic Waters Pollution Prevention Act. The legislation clearly states that the CCG is the lead federal agency to ensure an appropriate response to ship-source spills in Canadian waters, through monitoring clean-up actions of the polluter or by responding where the polluter is unable or unwilling to take action.

Further, the Environmental Response program aligns with federal government roles and responsibilities, as well as Government of Canada priorities of contributing to a clean and healthy environment and sustainable aquatic ecosystems. Speeches from the Throne (2013, 2015) note the importance of a clean environment, and the federal budgets (2012, 2014) explicitly mention Canada’s Oil Spill Regime, leading to the creation of the Tanker Safety Expert Panel and implementation of the Incident Command System (ICS).Footnote 7 Corporate documents identify the protection of Canada’s aquatic ecosystems as a main goal of the department, and the Environmental Response program also plays a key role in implementing recommendations from the Tanker Safety Expert Panel.

Continued need for the program

Key Finding: There is a continuing need for the Environmental Response program.

Additional pressures on the program indicate a continued need for the CCG to be prepared in the event of a marine oil spill. The importance of oil to the economy, increased vessel traffic in the Arctic, interest in Beaufort Sea oil and gas exploration, increased transportation of hazardous and noxious substances within Canadian waters, and potential deep sea drilling in the North Atlantic all place additional pressure on the program.

Further, there is an increased demand for the Government of Canada, and specifically the Environmental Response program, to address derelict/abandoned vessels, even in the absence of an imminent pollution threat. Finally, almost all key informants noted that the need for the program has increased over the past five years.

The CCG should continue to have a role in pollution response in Canadian waters. However, this role needs to be more defined, clearly articulating the CCGs lead role in response and within the marine oil spill regime. Submissions to the Tanker Safety Expert Panel also supported this finding, with several organizations mentioning the need for roles and responsibilities of lead and supporting federal agencies, as well as other players, to be clearly delineated.

Key Finding: Public expectations with respect to oil spill response are increasing and public confidence in the Government of Canada’s ability to respond is low, despite a decrease in the incidence of marine tanker spills.

The need for the Environmental Response program has also increased due to greater environmental awareness coupled with an increasing expectation that the Government of Canada is ready and able to respond to marine oil spills.

This greater level of awareness, and the associated increase in expectations, was mentioned by key informants across all regions. It was also noted in submissions to the Tanker Safety Expert Panel that the public is likely to expect and demand that the CCG be present and leading the response to ship-source oil spills. However, recent public opinion polling (2013) demonstrated that 47% of Canadians are not confident that the Government of Canada is able to respond effectively to a significant spill on water (figure 1).Footnote 8

Figure 1: Public Opinion Poll on Oil, Confidence that the Government of Canada
is able to respond effectively to a significant spill on water

figure1

Figure 1 shows the results of a public opinion poll on oil, confidence that the Government of Canada is able to respond effectively to a significant spill on water, in the form of a horizontal bar graph. The question asked “using a scale from 1 to 10, where 1 is not at all confident and 10 is very confident, how much confidence do you have that the Government of Canada is able to respond effectively to a significant oil spill on water?” The answers are provided by region and for Canada as a whole. Responses from 7 to 10 on the scale were classified as “confident”, responses from 5 to 6 were classified as “neutral”, responses from 1 to 4 were classified as “not confident”, and the remainder were classified as “DK/NA”. For Canada as a whole, 23% were confident, 27% were neutral, and 47% were not confident. For Atlantic Canada, 18% were confident, 37% were neutral, and 38% were not confident. For QC, 17% were confident, 25% were neutral, and 54% were not confident. For ON, 25% were confident, 25% were neutral, and 48% were not confident. For MB/SK, 13% were confident, 37% were neutral, and 48% were not confident. For AB, 48% were confident, 29% were neutral, and 20% were not confident. For BC, 11% were confident, 24% were neutral, and 60% were not confident.

Further, only 36% of Canadians have confidence that tankers and ships can transport oil safely on Canadian waters (figure 2).

Figure 2: Public Opinion Poll on Oil, Confidence that tankers and ships can
transport oil safely on Canadian waters

figure2

Figure 2 shows the results of a public opinion poll on oil, confidence that tankers and ships can transport oil safely on Canadian waters, in the form of a horizontal bar graph. The question asked “using a scale from 1 to 10, where 1 is not at all confident and 10 is very confident, how much confidence do you have that tankers and ships on Canadian waters can transport oil safely?” The answers are provided by region and for Canada as a whole. Responses from 7 to 10 on the scale were classified as “confident”, responses from 5 to 6 were classified as “neutral”, responses from 1 to 4 were classified as “not confident”, and the remainder were classified as “DK/NA”. For Canada as a whole, 36% were confident, 28% were neutral, and 34% were not confident. For Atlantic Canada, 34% were confident, 40% were neutral, and 25% were not confident. For QC, 30% were confident, 29% were neutral, and 39% were not confident. For ON, 38% were confident, 27% were neutral, and 34% were not confident. For MB/SK, 36% were confident, 31% were neutral, and 29% were not confident. For AB, 55% were confident, 31% were neutral, and 13% were not confident. For BC, 28% were confident, 21% were neutral, and 49% were not confident.

The increased need for the program is not linked with increase in marine oil spills either within Canada or internationally. In Canada, the overall number of incidents has declined over the last five years, most visibly in the Central and Arctic and Atlantic regions (figure 3). Footnote 9 Of note, over the last five years, the main sources of spills have typically been mystery (unknown), pleasure vessels or fishing vessels.

Figure 3: Total # of Marine Oil Spill Incidents by Year and Region

figure3

Figure 3 is a line graph showing the total number of marine oil spill incidents by year and region. For the Atlantic region there were 324 incidents in 2010, 294 incidents in 2011, 160 incidents in 2012, 207 incidents in 2013, and 190 incidents in 2014. For the C&A region there were 284 incidents in 2010, 253 incidents in 2011, 123 incidents in 2012, 172 incidents in 2013, and 163 incidents in 2014. For the Western region there were 602 incidents in 2010, 591 incidents in 2011, 466 incidents in 2012, 555 incidents in 2013, and 607 incidents in 2014. Across all regions there were 1,210 incidents in 2010, 1,138 incidents in 2011, 749 incidents in 2012, 934 incidents in 2013, and 960 incidents in 2014.

Source: MPIRS

This trend is evident internationally. Research indicates that tanker spills have decreased in both size and severity over the past 20 years, even as the number and size of marine tankers has increased.

The total volume of oil released in spills of over seven tonnes has declined between 1970-1979 and 2000-2009. Comparatively, in 2012, oil released in spills of over seven tonnes was the lowest on record for a single year — 1,000 tonnes.Footnote 10

Although the probability of a major spill is remote, the consequences of marine oil spills could be significant, indicating that a nationally consistent Environmental Response program is required in order for the CCG to be prepared in the event of any spill that requires a coordinated response.

4.2 Effectiveness

Overall, the CCG has been able to respond to all reported ship-source oil spills or marine pollution incidents within Canadian waters. However, some issues were identified that put at risk the CCGs ability to coordinate a response to a marine oil spill. In particular, some weaknesses with respect to national policy direction, gaps in training and exercising, and risks with respect to pollution countermeasures equipmentFootnote 11 were identified.

Policies, Directives and Guidelines

Key Finding: Overall, the Environmental Response program would benefit from nationally consistent and up-to-date program policies and guidelines.

Pursuant to the Emergency Management Act, federal ministers have a statutory responsibility to ensure they prepare an emergency management plan within their respective areas of responsibility. As a result of the 2010 OAG Audit, the CCG committed to updating its national response policy and associated plans and to establishing a periodic review process to ensure national and regional emergency plans remain accurate and relevant.

The National Environmental Response Preparedness and Response Policy was developed in 2001 to establish the CCGs contribution to the national preparedness and response regime. Efforts have been made to update the directives linked to the policy, but this has not been undertaken systematically, resulting in directives that are not nationally consistent. For example, there are nine directives posted on the CCG website with dates ranging from 2001 to 2013. Almost all key informants and survey respondents stated that the Environmental Response program policies, directives and guidelines are not up-to-date and that they lack clear national direction. Further, the Environmental Response program has not clearly articulated its mandate with respect to marine oil spills to its internal and external stakeholders.

Previous OAG Audits and the 2010 Internal Audit had similar findings, noting that foundational documents are not nationally consistent, placing the CCG at risk of being unable to coordinate a response to an incident. More specifically, previous OAG Audit found inconsistencies in CCG regional procedures, practices and organizational structures and guidance from NHQ was found to be lacking, out of date or too general.

To demonstrate national consistency, guidelines, policies and levels of service, it was recommended that standard operating procedures be developed.

A National Contingency Plan and Regional Contingency Plans exist. The Plans were developed and updated at different time intervals, and as a result they vary in format and content. The CCG Environmental Response Marine Spills Contingency Plan National Chapter was drafted in 2011 and later updated in 2015. This version remains in draft form. This plan defines the scope and framework within which the CCG will operate to ensure a response to marine pollution incidents. According to service standards the plan is updated every five years and regional chapters of the plan are to be maintained in all three regions.

All regions have either a Contingency Plan or a Response Plan in place. The Western Region has a Contingency Plan (2001); the Central and Arctic region has a Response Plan (2008); and the Atlantic Region has a Contingency Plan (2014). The 2010 OAG Audit and the 2010 Internal Audit noted similar findings that regional plans are not consistent across regions and the plans’ being updated at different points in time does not provide a foundation to provide nationally consistent regional operations and services. Clear national policy direction is required in order to ensure regional contingency plans are accurate and reflect national program direction.

The CCG has recently been making efforts to define the program and determine a way forward through a proposed concept of operations, intended to provide a single national reference for all policy and operational practices and procedures, as well as through other initiatives aimed at improving program effectiveness and efficiency. It was noted that there is some uncertainty with respect to the future direction of the program because of several ongoing initiatives such as the World Class Tanker Safety, specifically Area Response Planning, which may influence program operations. A national guiding policy for the program would be beneficial for informing any revisions or ongoing improvements to program operations.

Training

Key Finding: Training is not consistently organized and delivered across all regions, resulting in gaps.

The OAG Audit conducted in 2010 found that the CCG lacks an overall training plan, and, as a result, training is delivered on an ad-hoc basis. The OAG also noted that it is important that staff across regions have the same basic training to ensure a consistent response in the case of a major spill that requires a multi-regional response. Similarly, the 2010 Internal Audit found there is no national training strategy in place for the Environmental Response program and that training is being conducted on an ad-hoc regional basis with no assurance that employees are being trained in a nationally consistent manner. It was also found that competency profiles did not exist for all positions / functions in the Environmental Response program. The audit made the following recommendations with regard to training: develop competency profiles; define training requirements for all positions; develop a national training strategy; and develop a monitoring process.

Similar to the OAG and Internal Audit in 2010, gaps in training were evident. There is neither a national training program in place, nor are there approved competencies profiles for the Environmental Response program.Footnote 12 As a result, training is not being designed and delivered in a coordinated and consistent manner across regions. Each region has developed its own standards, guidelines and training and data on regional training was not available. The lack of national coordination creates an imbalance in learning which may result in different levels of awareness, knowledge and preparedness across regions.

Almost all key informants and those surveyed stated that the training and exercises available were useful and provided the tools and knowledge to respond to a marine pollution incident. However, more than half of those surveyed stated that Environmental Response training was not sufficient or accessible. Further, almost all those interviewed and surveyed were of the opinion that there is a requirement for additional training to effectively respond to a marine pollution incident.

Since 2010-11, the CCG College has trained over 500 individuals over seven different Environmental Response courses (figure 4).Footnote 13 Other courses are delivered by the regions; though data was not readily available on the type or number of those courses, or the number of personnel trained.Footnote 14

Figure 4: Environmental Response Courses Delivered by CCG College 2010-11 to 2015

figure4

Figure 4 is a bar graph showing the Environmental Response courses delivered by the Canadian Coast Guard College from 2010-11 to 2015. The graph shows the number of people trained, per course, over this time period. There were 128 trained in “Marine Spill Response Operations”, 57 trained in “Exercises, Planning, Conduct and Evaluation”, 118 trained in “Pollution Response Officer”, 156 trained in “Pollution Control 240”, 32 trained in “Basics of Oil Spill Response”, 20 trained in “Response Management System”, and 13 trained in “ICS-100”.

Source: CCG College

The CCG College maintains a three year training plan that schedules the courses delivered by the College. The courses included in the plan are based on identified needs by the regions. As of 2012, there are no longer dedicated program officers in the regions. This change, along with the available resources and competing priorities, impact the regions ability to accurately identify their training needs, provide input into the three year plan, and make the time available to attend training.

Recent improvements have been made with respect to training. A CCG Environmental Response National Training Plan was developed in 2010 and later updated in 2012. The purpose of the plan is to define the scope within which CCG Environmental Response personnel will be trained. There was no evidence that the plan has been updated since 2012 or that the plan is followed by the regions. Further, until the competency profiles have been approved, the Training Plan cannot be finalized.

In addition, a Training Advisory Group (TAG) was established in 2014 with national and regional representation for the purpose of reviewing the national training plans and national training programs for the CCG. The objective of TAG is to ensure that national and regional training needs are being met and are delivered in a cost-effective manner. The TAG identified several relevant priorities: the development and implementation of competency profiles; the design and delivery of a National Duty Officer course; and, an Introduction to Environmental Response course. At the time of this evaluation, competency profiles had not been finalized and the National Duty Officer and Introduction to Environmental Response courses had not been developed.Footnote 15

The development and implementation of national training guidance and documentation relies upon established national program policies and procedures. It was noted that if the policies and national direction of the program were clear and competency profiles were in place, the training could be adapted to meet the specific needs of the program. The Environmental Response training offers generic skills; however it is difficult to find more specialized training beyond the basic level. Some personnel felt that this left them vulnerable with regards to components such as health and safety, legal, finance and communications. Further, while training may be available, the ability of Environmental Response personnel to attend training is impacted by a lack of available resources and the time commitment required to respond to ongoing incidents.

Exercises

Key Finding: Exercises help prepare Environmental Response personnel to respond to marine pollution incidents. There is a need for strategic direction in the development and execution of the National Exercise Plan.

The CCG Environmental Response program is guided by mandatory exercise commitments stated in the Canada Shipping Act, 2001, as well as commitments in Levels of Service and agreements with international countries. In order to adequately evaluate the effectiveness of procedures, equipment and resources identified in contingency plans, exercises should be conducted in coordination with ships, oil handling facilities, ROs, and the CCG. With regards to international agreements, Canada and the United States have a Joint Marine Pollution Contingency Plan (JCP). The purpose of this plan is to provide a coordinated system for planning, preparedness and response to harmful substance incidents in the contiguous waters.

A requirement of the plan is to exercise the five area plans on a regular basis to ensure an appropriate level of response preparedness. The evaluation found that the CCG is meeting its mandated marine pollution incident exercise requirements, pursuant to the Canada Shipping Act and other international agreements such as the JCP.

The National Marine Spill Response Exercise Program (NEP) was developed in the 1990’s. The purpose of the program was to provide principles, guidelines and planning tools to help the response community develop cost-effective and realistic exercises. The CCG developed the NEP in cooperation with industry, other government departments and Non-Governmental Organizations involved with oil spill response.

The 2010 OAG Audit found no evidence of a national process for overseeing exercises, nor any consistent and systematic documentation of exercises or sharing of lessons learned. There was no assurance that the regions are adhering to the national exercise plan. In addition, there was no evidence of any inter-regional exercises. As a result of the 2010 OAG Audit the CCG committed to developing a revised exercise plan with the aim to improve collaboration on exercise planning and to share lessons learned. In 2014-15 a National Exercise Plan was developed by the Environmental Response program in NHQ with input from the regions. The plan includes a summary of exercises that the CCG either led or co-led, a schedule for the current year, a multi-year forecast, brief exercise summaries from the previous year which include some overall strengths, weaknesses, opportunities and threats, as well as an action plan. The Plan is a mechanism for summarizing the previous year’s exercises. The regions and NHQ continue to plan and execute exercises within their respective regions.

In 2014-15, 24 exercises took place, the majority led by Industry / ROs. Approximately 29% of the exercises conducted in 2014-15 produced an after-action report (n=7). Those led by the CCG did produce after-action reports.

Figure 5: 2014-2015 Exercises

figure5

Figure 5 is a bar graph showings the number of CCG-led and other-led exercises, as well as the number of after-action reports, for 2014-15, in each region. In the Atlantic region there were 2 CCG-led exercises, 15 other-led exercises, and 2 after-action reports. In C&A region there were 2 CCG-led exercises, 1 other-led exercise, and 3 after-action reports. In Western region there were 0 CCG-led exercises, 4 other-led exercises, and 2 after-action reports.

Source: National Exercise Plan 2014, Exercise Calendar updated January 21, 2015

While most survey respondents were satisfied with the knowledge gained from partner-led exercises and felt they prepared Environmental Response personnel to respond to a marine pollution incident, both key informants and survey respondents felt that CCG-led exercises were not sufficient or accessible. Almost half of the survey respondents were unsure if after action reports were used to update Environmental Response policies and procedures. Key informants mentioned that exercises could be even more useful if the National Exercise Plan identified specific learning goals, objectives, and gaps that would target areas where the Environmental Response program could benefit from an exercise, as well as commitments to share and implement lessons learned, and structure to support this.

While the CCG has made efforts to improve the approach and national coordination to exercise planning, and while the current plan addresses some of the OAG Audit findings, there remains a lack of coordination and national strategic direction, limited goals and objectives driving the purpose of the exercises, limited inter-regional exercising opportunities, and limited evidence of dissemination and application of lessons learned.

Equipment

Key Finding: Environmental Response assets are not managed according to nationally consistent CCG procedures and processes.

Current and reliable information on the state of equipment was difficult to obtain. Environmental Response assets are not managed according to nationally consistent CCG procedures and processes. The 2010 Internal Audit and 2010 OAG Audit presented similar findings, stating that lifecycle management of response equipment was not nationally consistent, nor managed using CCG designated systems. For example, Integrated Technical Services (ITS) does not manage Environmental Response equipment the way it does for other CCG programs. While evidence exists demonstrating that the CCG would like to move Environmental Response assets into the standard asset management software, to date this has not been completed and no timelines for completion have been provided.

Key Finding: Environmental Response equipment is outdated. To date, the state of the equipment has not affected the CCGs ability to respond.

Evidence indicates that over 50% of Environmental Response equipment is 25 years of age or older and well beyond its supportable life. This refers specifically to pollution countermeasures equipment, and does not include vehicles or the CCGs recent financial investment in several Pollution Response Vessels.

Key informants noted that Environmental Response equipment is old, is not often used, and it is unclear how long it would last if deployed. It was also noted that there is some equipment in the inventory that has never been used. The 2010 OAG Audit similarly stated that the age and condition of response equipment was placing the program’s preparedness and response capabilities at risk. To date, the current state of Environmental Response equipment has not hindered the program’s ability to respond to an oil spill, however the current state of equipment continues to be a risk for the CCG.

Almost all key informants and those surveyed noted that the equipment is operationally available and ready to respond; however, equipment is old and it is unclear if it is adapted to the program’s needs or the direction towards which the program is moving. The 2010 Internal Audit supports these findings, stating that there has been no consistent nationally coordinated investment in equipment since the 1990’s, with acquisitions taking place on an ad hoc regional basis determined on the availability of funding. The audit recommended the development of a national equipment strategy and coordination of processes with ITS.

The CCG is currently undertaking an Environmental Response refurbishment project, which includes the conduct of an asset condition assessment to determine the condition of the Environmental Response asset base. This assessment is intended to be used to support the development of recommendations for future procurement, life-cycle management, disposal and allocation of Environmental Response equipment. The future acquisition or replacement of equipment needs to happen in parallel with a clear policy direction for the program to ensure the appropriate acquisition, as well as the resources to support the training and deployment of the equipment.

4.3 Assessment of Resource Allocation

The tables below outline the Environmental Response program expenditures from 2010-11 to 2014-15. Overall, funding has remained relatively stable. From 2011-12 to 2014-15 variances can be explained mostly by special purpose funding related to the “Zalinski Operation”Footnote 16 that was intended only to be spent on this project, and to some extent funding related to Phase 1 (community engagement) and Phase 2 (area response planning) of the World Class Tanker Safety System.

Table 3: Overview of Environmental Response Program Expenditures and FTEs, 2010-11 to 2014-15
2010-11 2011-12 2012-13 2013-14 2014-15
Region Expenditures FTEs Expenditures FTEs Expenditures FTEs Expenditures FTEs Expenditures FTEs
Atlantic 3,078,043 32 3,405,259 31 3,305,830 29 4,729,700 27 5,993,635 28
C&A 3,435,778 27 3,390,182 27 3,426,914 28 3,314,603 26 7,876,619 25
Western 1,834,651 15 1,615,906 14 2,432,223 13 25,137,866 22 2,737,184 17
NCR 1,288,827 9 1,392,046 9 1,562,766 9 554,305 4 1,009,926 5
TOTAL 9,637,300 83 9,803,392 81 10,727,732 79 33,736,474 79 17,617,364 75

Table 3 shows an overview of the Environmental Response Program Expenditures and FTEs, from 2010-11 to 2014-15, by region. The table has 7 rows. The first two rows show headings, with the top row dividing the columns by fiscal year and the second row showing headings for “Region” and then “Expenditures” and “FTEs” for each fiscal year. Row 3 shows expenditures and FTEs for the Atlantic region. In 2010-11 there were $3,078,043 in expenditures and 32 FTEs. In 2011-12 there were $3,405,259 in expenditures and 31 FTEs. In 2012-13 there were $3,305,830 in expenditures and 29 FTEs. In 2013-14 there were $4,729,700 in expenditures and 27 FTEs. In 2014-15 there were $5,993,635 in expenditures and 28 FTEs. Row 4 shows expenditures and FTEs for the C&A region. In 2010-11 there were $3,435,778 in expenditures and 27 FTEs. In 2011-12 there were $3,390,182 in expenditures and 27 FTEs. In 2012-13 there were $3,426,914 in expenditures and 28 FTEs. In 2013-14 there were $3,314,603 in expenditures and 26 FTEs. In 2014-15 there were $7,876,619 in expenditures and 25 FTEs. Row 5 shows expenditures and FTEs for the Western region. In 2010-11 there were $1,834,651 in expenditures and 15 FTEs. In 2011-12 there were $1,615,906 in expenditures and 14 FTEs. In 2012-13 there were $2,432,223 in expenditures and 13 FTEs. In 2013-14 there were $25,137,866 in expenditures and 22 FTEs. In 2014-15 there were $2,737,184 in expenditures and 17 FTEs. Row 6 shows expenditures and FTEs for the NCR region. In 2010-11 there were $1,288,827 in expenditures and 9 FTEs. In 2011-12 there were $1,392,046 in expenditures and 9 FTEs. In 2012-13 there were $1,562,766 in expenditures and 9 FTEs. In 2013-14 there were $554,305 in expenditures and 4 FTEs. In 2014-15 there were $1,009,926 in expenditures and 5 FTEs. Row 7 shows total expenditures and FTEs for all regions. In 2010-11 there were $9,637,300 in expenditures and 83 FTEs. In 2011-12 there were $9,803,392 in expenditures and 81 FTEs. In 2012-13 there were $10,727,732 in expenditures and 79 FTEs. In 2013-14 there were $33,736,474 in expenditures and 79 FTEs. In 2014-15 there were $17,617,364 in expenditures and 75 FTEs.

Source: Business & Resource Management, IBMS, CCG

Expenditures over the last five years, including FTEs, and the number of recorded incidents across regions were examined. The Western region had the largest number of recorded incidents, the fewest FTEs and the lowest O&M expenditures (including all reported incidents (levels 1 – 5)Footnote 17 and excluding special purpose funding for the Zalinski operation) (figure 6). Footnote 18

Figure 6: Level 1 – 5 Recorded Incidents vs. All Resources by Region 2010-11 to 2014-15Footnote 19

figure6

Figure 6 is a bar graph showing the average FTEs, the average O&M, and the average number of recorded incidents (levels 1-5), per region, for the period 2010-11 to 2014-15. For the Atlantic region, the average number of FTEs was 29.4, the average O&M was $1,200,000 (rounded), and the average number of incidents was 235. For the C&A region, the average number of FTEs was 26.6, the average O&M was $1,830,000 (rounded), and the average number of incidents was 199. For the Western region, the average number of FTEs was 16.2, the average O&M was $5,110,000, and the average number of incidents was 564.

Source: MPIRS and Business & Resource Management, IBMS, CCG

When examining only level 3 – 5 incidentsFootnote 20 over the last five years (figure 7), the Western region continues to have the largest number of recorded incidents, the fewest FTEs, and the least O&M expenditures. Since 2010, the Western region recorded 703 level 3 incidents, the Central and Arctic region recorded 514 level 3 – 5 incidents, and the Atlantic Region recorded 494 level 3 incidents.

Figure 7: Level 3 – 5 Recorded Incidents vs. Resources by Region 2010-11 to 2014-15 (without Zalinksi funding)

figure7

Figure 7 is a bar graph showing the average FTEs, the average O&M, and the average number of recorded incidents (levels 3-5), per region, for the period 2010-11 to 2014-15, excluding Zalinski funding. For the Atlantic region, the average number of FTEs was 29.4, the average O&M was $1,200,000 (rounded), and the average number of incidents was 99. For the C&A region, the average number of FTEs was 26.6, the average O&M was $1,830,000 (rounded), and the average number of incidents was 103. For the Western region, the average number of FTEs was 16.2, the average O&M was $920,000, and the average number of incidents was 141.

Source: MPIRS and Business & Resource Management, IBMS, CCG

More specifically, when examining all recorded incidents since 2010, the Western region recorded four times the number of level 1 and 2 incidents and 1.5 times the number of level 3 incidents when compared to the Central and Arctic region, and three times the number of level 1 and 2 incidents and 1.4 times the number of level 3 incidents when compared to the Atlantic Region.

Figure 8: Incident Levels by Region, 2010 to 2014

figure8

Figure 8 is three separate line graphs, one for each region, each showing the trend for the number of level 1 and 2 incidents and a separate trend line for level 3 and 5 incidents, by year. For Western region, there were 473 level 1&2 incidents in 2010, 434 in 2011, 347 in 2012, 403 in 2013, and 461 in 2014. There were 129 level 3&5 incidents in 2010, 157 in 2011, 119 in 2012, 152 in 2013, and 146 in 2014. For C&A region, there were 121 level 1&2 incidents in 2010, 129 in 2011, 73 in 2012, 83 in 2013, and 75 in 2014. There were 163 level 3&5 incidents in 2010, 124 in 2011, 50 in 2012, 89 in 2013, and 88 in 2014. For Atlantic region, there were 238 level 1&2 incidents in 2010, 187 in 2011, 99 in 2012, 94 in 2013, and 62 in 2014. There were 85 level 3&5 incidents in 2010, 107 in 2011, 61 in 2012, 113 in 2013, and 128 in 2014.

Source: MPIRS

As previously noted the variances with respect to recorded level 1 – 2 incidents may be due to differences in regional procedures and data collection, and comparisons are therefore unreliable. However, alternative means for responding to level 1 and 2 incidents, which typically result in no requirement for cleanup or pollution threat mitigation operations (as may already be in place some regions), may provide some efficiencies to the program which would allow Environmental Response personnel to focus on the incidents that result in a level 3 response or higher. This may be particularly true in the Western region, where evidence indicates the public has a heightened awareness of environmental issues, and where the reporting of marine pollution incidents may have different procedures than other regions, both of which may have impacted the number of level 1 and 2 incidents reported.

Key Finding: The CCG is funded for maintaining a state of preparedness rather than funded for full program delivery, and must recover costs from shipowners or other governing bodies under the Canadian Compensation Regime. Few incidents have been cost recovered.

The Canadian Compensation Regime is based on the fundamental principle that the shipowner is primarily liable for oil pollution damage caused by the ship (known as the “polluter-pay principle”). Costs are therefore recovered directly through the shipowner/insurance or other governing bodies under the Canadian Compensation Regime. In accordance with the Marine Liability Act, Canada’s Ship-source Oil Pollution Fund (SOPF), explained further below, supplements coverage available through international funds, and provides coverage for certain types of spills not covered by international conventions (e.g. mystery spills).

The CCG currently assumes 100% of the initial financial risk when it incurs costs associated with response operations. This is partially due to the fact that the CCG is funded for maintaining a state of preparedness rather than funded for full program delivery. As a result, the CCG must recover costs related to their activities responding to marine oil spills.

Since 2010-11, 1.8% of all incidents have been pursued for cost recovery (Figure 9). When Level Level 0 – 2 incidents (no requirement to undertake cleanup or pollution threat mitigation operations) are excluded from the calculation, 5.22% of incidents (level 3 – 5) have been pursued for cost recovery since 2010-11.

Figure 9: Cost Recovery of Environmental Response Incidents, 2010-11 to 2014 - 15

figure9

Figure 9 is a bar graph showing the number of environmental response incidents that were cost recovered and the number that were not cost recovered for each year. In 2010-11, 24 incidents were cost recovered and 343 were not. 2011-12, 21 incidents were cost recovered and 353 were not. In 2012-13, 21 incidents were cost recovered and 226 were not. In 2013-14, 16 incidents were cost recovered and 356 were not. In 2014-15, 8 incidents were cost recovered and 355 were not.

Source: IBMS, CCG

Based on available evidence, it seems that a further 7% of incidents should have been pursued for cost recovery. These incidents took longer than a day to resolve (i.e. the time and effort involved to proceed with cost recovery may be worth the claim the CCG would submit). However, the CCG has not put in place a systematic, documented method for determining which incidents should be cost-recovered.

Additionally, regions are responsible for preparing and submitting cost recovery claims. Many key informants noted that a lack of financial knowledge and a lack of support impact their ability to submit claims. The SOPF does require considerable documentation to substantiate a claim.Footnote 21 While the CCG has moved forward to improve the cost recovery process, further steps need to be taken to ensure that the CCG is recovering all reasonable costs. To date, the CCG has updated its Cost Recovery ManualFootnote 22 and has proceeded with various improvements and updates to support the cost recovery process.Footnote 23 However, missing from this guidance is clear direction on when Environmental Response personnel in the region should or should not pursue cost recovery, and a lack of support to proceed with the collection of evidence, where required to do so.

Key Finding: The CCG has not been able to recover all costs associated with its obligations to ensure an appropriate response to ship-source spills or marine pollution events in Canadian waters.

The SOPF was established under amendments to the former Canada Shipping Act and is governed by Part 7 of the Marine Liability Act.Footnote 24 The SOPF is a special account established in the accounts of Canada to which interest is credited monthly by the Minister of Finance. The SOPF is liable to pay claims for oil pollution damage or anticipated damage at any place in Canada, or in Canadian waters, including the exclusive economic zone of Canada, caused by the discharge of oil from a ship. Thus, the SOPF is not limited to oil tankers or to persistent oil, as is the international regime. The system is designed to cover the risk of non-payment by the shipowner who is responsible for pollution. In addition, it covers claims for damage and clean-up costs where the identity of the ship that caused the discharge of oil cannot be established.

The fund, in existence since 1973, reached approximately $409 million in 2015. On average the fund grows by $11 million each year, paying out approximately $400,000 annually. Initially established through industry contributions from 1972 to 1976, it is primarily accessed following incidents that involve fishing vessels and pleasure craft that are considered derelict and/or abandoned.

As provided for by legislation, any person in Canada, including private corporations and the Crown, may file a claim with the SOPF in regards to loss, damage, costs and expenses resulting from ship-source oil pollution.

After the Administrator of the SOPF investigates and pays a claim, the SOPF has a duty to take all reasonable measures to recover from the owner of the ship, or any other applicable source, the compensation paid to claimants. Since 2004, the CCG has been the primary claimant accounting for 81% of claims and 85% of the dollar value of all claims submitted to the SOPF. Cost recovery claims submitted by the CCG are most often settled through the SOPF. Since 2010-11, 60% of claims were settled with SOPF.

Since 2010-11, the CCG has pursued cost recovery for 90 incidents in the amount of $3,710,944.46 and received settlements for a total of $2,834,499.52. This represents an overall success rate of 76.4% where cost recovery is pursued either through the SOPF or the Shipowner. Of interest, the CCG is more successful (approximately a 99% success rate) when cost recovery is pursued directly with the shipowner/insurer than when cost recovery is pursued through the SOPF (approximately a 79% success rate).

Figure 10: Amount ($) of Environmental Response Claims Settled, 2010-11 to 2014-15

figure10

Figure 10 is a bar graph showing the amount (in dollars) of Environmental Response claims vs. the settlement amount, per year. For 2010-11, the amount claimed was $910,789 and the settlement amount was $539,845. For 2011-12, the amount claimed was $812,310 and the settlement amount was $396,845. For 2012-13, the amount claimed was $544,606 and the settlement amount was $465,686. For 2013-14, the amount claimed was $729,139 and the settlement amount was $718,737. For 2014-15, the amount claimed was $714,101 and the settlement amount was $713,387.

Source: IBMS, CCG

Several issues related to the SOPF were raised during the evaluation that impact the CCG’s ability to effectively and efficiently proceed with its current obligations.

There are time limits on claims made to the SOPF. Claims must be submitted within two years of pollution damage and within five years of the incident that precipitated the pollution, or within five years after the potential risk of pollution is identified and anticipated. The Marine Liability Act restricts the submission of additional claims on the same incident. On average, it takes the CCG approximately 430 calendar days from the incident to the time that funds are recovered from the SOPF. This is due, in part, to attempts to first recover costs from the shipowners/insurer as well as attempts to ensure no residual costs are incurred. Further, while there is no time limitation on the SOPF to conduct a claim assessment, it takes the SOPF approximately 190 calendar days from the time a claim is received to receipt of a settlement offer.

As mentioned earlier, and as a result of the above circumstances, the CCG currently assumes 100% of the initial financial risk when it incurs costs associated with environmental response operations. Since January 2014 the CCG has accepted 17 offers from the SOPF, totaling $945,528.20. However, the SOPF does not recognize the CCG’s acceptance of these offers and is currently withholding these funds, pending the resolution of an ongoing legal issue.

Irrespective of this issue, when costs are recoverable, settlements from the shipowner/insurer or the SOPF are often realized in future fiscal years. This results in regional financial pressures in the year where the funds are expended. In some cases preparedness activities are forfeited to fund response activities and in other cases activities planned for the delivery of other programs are forfeited in order to fund response activities.

Recent reviews have been critical of this situation. The report from the Tanker Safety Expert Panel argued that “in the event of a large-scale spill, decisions need to be taken and executed quickly, and even though these decisions are informed by well-developed contingency plans, there may be instances where early access to funds by federal authorities could accelerate the response.”Footnote 25 The report further noted that the United States has access to an emergency fund ($50 million) which enables an on-scene coordinator to determine what assets, services or actions are needed for immediate response to a spill, and to draw funds to support these measures. This type of emergency fund in Canada, which the Panel recommended, would provide the CCG with early access resources for reasonable expenses to initiate and maintain the response, and relieve the pressure to sacrifice other CCG activities to fund a response to an incident. Certainly, an emergency fund, or some type of alternative funding mechanisms, need to be explored to alleviate the risks to the CCGs operating budget.

The SOPF is available to pay compensation for “reasonable” claims. As the definition of “reasonable” is not provided in legislation, the determination of what is reasonable, and the subsequent compensation, is determined on a case by case basis in accordance with interpretations of the Marine Liability Act. The current interpretation of “reasonable” may exclude many activities that are currently related to oil spill clean-up and that are in line with current public expectations. For example, some claims that included items such as over-time, salary, travel, activities related to media relations, public outcry and political pressures, fuel, in some instances contract services, and, activities related to prevention, were not determined to be reasonable.

As a result the CCG is not fully compensated for the costs it incurs, though the CCG exercises its mandate based on available information in combination with the expert opinion of its Environmental Response personnel and with the intent to ensure that both short- and long-term environmental and economic impacts are minimized. Therefore, the CCG is unable to recover all costs associated with its obligations to ensure an appropriate response to ship-source spill or marine pollution events in Canadian waters. The Regime on which the CCG relies to fund its response activities is not aligned with current operating realities and public expectations. Further, the claims process itself is cumbersome. Any amendments to the Regime, or the SOPF, would be legislative in nature, and would have to be pursued in collaboration with Transport Canada.

4.4 Critical Success Factors/Key Barriers

Key Finding: The evaluation found that roles and responsibilities within the CCG are not clear.

In response to the 2010 Internal Audit, the CCG created an Environmental Response Branch with “dedicated strategic capacity” to strengthen program governance. With the 2012 organizational changes made to the structure of the CCG this dedicated branch was dissolved, resulting in confusion around roles and responsibilities. Many regional key informants noted that prior to 2012 there was a clear point of contact and centre of expertise for the Environmental Response program at NHQ. As a result of the re-organization this clarity was lost, further impacting the ability of the program to provide clear national direction. Further, the majority of key informants also stated that the roles and responsibilities between Operations and National Strategies in NHQ are not clearly defined or understood, which results in a lack of clarity regarding responsibilities.

Key Finding: The evaluation found that roles and responsibilities among partners within the Canadian Oil Spill Regime are generally clear and understood.

Overall, it appears that roles and responsibilities between the Environmental Response program and its partners and stakeholders are generally clear and understood. Key informants did, however, raise two issues in this respect. Environment Canada’s decision to close its regional environmental emergencies program and consolidate offices has had an impact on the physical presence of Environment Canada staff during an incident. As well, it was noted that overlapping responsibilities between the CCG and Transport Canada could cause some delays in oil spill response, specifically with respect to authorities to direct vessels, as outlined in section 180 and 189 of the Canada Shipping Act.

Key Finding: The evaluation found that dedicated, experienced and knowledgeable staff are a key success factor for the program, however the Environmental Response program faces a number of challenges.

All key informants and those surveyed noted that the greatest strength of the Environmental Response program is the dedicated, experienced and knowledgeable personnel in the regions. The personnel have worked hard to ensure program objectives are met despite facing challenges. In some ways, the Environmental Response program has been operating independently from other CCG programs (within a “silo”). Similar to the other CCG programs, the Environmental Response program has experienced a strain with respect to both financial and human resources. However, the environmental response program has some unique needs when it comes to financial management (e.g. preparation of cost recovery claims), asset management, and training. CCG has not had the capacity to support these unique needs and this places an increased burden upon existing Environmental Response personnel. In spite of this, Environmental Response personnel have been able to continue to respond to ship-source oil spills or marine pollution events. The required level of effort is likely not sustainable over the long-term.

A number of other challenges were faced by the Environmental Response program:

  • Policies and rules around human resources, contracting and procurement, IT and security are restrictive in emergency management situations.
  • Restrictions around Government of Canada network security protocols prevent the sharing of information with partners, which in turn prevents effective coordination of incident management.
  • The program is not designed as a truly 24/7 operational response organization. This is particularly evident in the fact that operations are not designed on a 24-hour basis similar to other CCG programs.
  • Language poses a barrier in two ways. First, the translation of program documents has resulted in inconsistent interpretations; and second, there are difficulties with the cascading of human resources from predominantly French-speaking areas to predominantly English-speaking areas and vice versa.The consolidation from five CCG regions to three means that each region is responsible for a very large geographical area. The Arctic poses an additional challenge in this respect, as a lack of readily accessible infrastructure across the Arctic makes responding to significant spills very difficult. Even though response equipment is prepositioned in various areas of the Arctic, gaining access to it and deploying it without full logistical support on site would prove extremely challenging, along with the difficulties and costs related to equipment maintenance and responder training.Footnote 26

5.0 CONCLUSIONS AND RECOMMENDATIONS

5.1 Conclusions

Relevance

The legal basis and authority for the Environmental Response program is clearly articulated within legislation stating that the CCG is the lead federal agency for all ship-source oil spills or pollution incidents in waters under Canadian jurisdiction. However this leadership role needs to be more clearly articulated by the CCG. The program also aligns with federal roles and responsibilities and the government’s priority of contributing to a clean and healthy environment and sustainable aquatic ecosystems.

The need for the program has increased over time, particularly due to greater environmental awareness, added pressures from new and emerging issues, and, increasing public expectations that the Government of Canada to be ready and able to respond to marine oil spills.

Performance

Overall, the CCG has been able to respond to reported all ship-source oil spills or marine pollution incidents within Canadian waters. However, some issues were identified that put at risk the CCGs ability to coordinate a response to a marine oil spill. In particular, some weaknesses with respect to national policy direction, gaps in training and exercising, and risks with respect to pollution countermeasures equipmentFootnote 27 were identified.

The Environmental Response program would benefit from nationally consistent and up-to-date program policies, directives and guidelines. The current program policy was last updated in 2001, and several of the core program documents are not nationally consistent or up-to-date, placing the CCG at risk of being unable to coordinate a response to an incident. Clear national policy direction is required to ensure regional plans are accurate and reflect national program direction, and would help inform ongoing revisions and improvements to program operations.

Training is not consistently organized and delivered across all regions, resulting in gaps. That is, it is not being designed and delivered in a coordinated and consistent manner across regions. This lack of national coordination creates an imbalance in learning which may result in different levels of awareness, knowledge and preparedness across regions. Additionally, while exercises (both partner-led and CCG-led) help prepare Environmental Response personnel to respond to marine pollution incidents there is a need for strategic direction in the development and execution of the National Exercise Plan, which currently lacks coordination and national strategic direction, has limited goals or objectives driving the purpose of the exercises, has limited inter-regional exercising opportunities, and limited dissemination and application of lessons learned.

Environmental Response assets and equipment are not managed according to nationally consistent CCG procedures and processes, and the equipment is largely outdated and beyond its supportable life. The age of the equipment continues to be a risk for the CCG, as its level of reliability is unknown. However, it has not hindered the CCGs ability to respond to marine pollution incidents to date.

The CCG is funded for maintaining a state of preparedness rather than funded for full program delivery, and must recover costs from shipowners or other bodies under the Canadian Compensation Regime. To date, few incidents have been cost recovered. In the majority of these incidents, there may have been no requirements to undertake cleanup or pollution threat mitigations operations, or the value of the claim may be minimal in comparison to the costs and time/effort of submitting a claim (the response required was resolved in one day or less). There is no guidance in place to determine when cost recovery should be pursued. Regions are responsible for preparing and submitting cost recovery claims, and many key informants noted that a lack of support impacts their ability to submit claims. In addition, the CCG is unable to recover all costs associated with its obligations to ensure an appropriate response to ship-source spills or marine pollution events in Canadian waters. The Regime on which the CCG relies to fund its response activities is not aligned with current operating realities and public expectations.

Finally, the Environmental Response program faces a number of other challenges. In particular, it was found that the Environmental Response program is operating independently from other CCG programs. Similar to the other CCG programs, the Environmental Response program has experienced a strain with respect to both financial and human resources. However, the environmental response program has some unique needs when it comes to financial management (e.g. preparation of cost recovery claims), asset management, and training. CCG has not had the capacity to support these unique needs and this places an increased burden upon existing Environmental Response personnel. In spite of this, Environmental Response personnel have been able to continue to respond to ship-source oil spills or marine pollution events. The required level of effort is likely not sustainable over the long-term.

5.2 Recommendations

Based on the findings of the evaluation, three recommendations are being made.

Recommendation 1:

Rationale: The following are placing the CCG at risk when it comes to being prepared in the event of any marine oil spill that requires a coordinated response:

  • Nationally inconsistent and outdated program policies, directives and guidelines - the CCG needs to articulate more clearly, to its internal and external stakeholders, its role as the lead federal agency when it comes to responding to ship-source spills in Canadian waters.
  • Inconsistent training – training is not consistently organized and delivered across all regions, resulting in gaps. The lack of consistency across regions creates an imbalance in learning which may result in different levels of awareness, knowledge, and preparedness across regions.
  • Lack of strategic direction and coordination in the development and execution of the National Exercise Plan. The plan has limited goals or objectives driving the purpose of the exercises and there is limited evidence of the dissemination and use of lessons learned.

Recommendation 1: The CCG should put in place nationally consistent policies, directives and documentation that clearly identify the CCG as the lead federal agency for all ship-source oil spills or pollution incidents in waters under Canadian jurisdiction. Ensure program documentation aligns with the national strategic direction on areas such as: mandate and role, training, and exercises.

Recommendation 2:

Rationale: Evidence indicates that few marine oil spill incidents have been cost recovered by the CCG. There is no guidance in place to determine when cost recovery should be pursued. Regions are responsible for preparing and submitting cost recovery claims and many key informants noted that a lack of support impacts their ability to submit claims.

Recommendation 2: The CCG should put in place measures to ensure that all appropriate claims are pursued for cost recovery. Further, the CCG should document a systematic process for determining when it is most appropriate to proceed with cost recovery.

Recommendation 3:

Rationale: The Environmental Response program is operating independently from the other CCG programs. The program has some unique needs related to financial management, asset management, and training. The CCG has not had the capacity to support these unique needs. This has placed an increased burden upon existing Environmental Response personnel.

Recommendation 3: The CCG should ensure the program is provided with sufficient support to address the unique requirements of the Environmental Response program. In particular, ensure that Environmental Response personnel in the regions have the support needed to proceed with cost-recovery claims.

ANNEX A: MANAGEMENT ACTION PLAN

RECOMMENDATION 1

Rationale: The following are placing the CCG at risk when it comes to being prepared in the event of any marine oil spill that requires a coordinated response:

  • Nationally inconsistent and outdated program policies, directives and guidelines - the CCG needs to articulate more clearly, to its internal and external stakeholders, its role as the lead federal agency when it comes to responding to ship-source spills in Canadian waters.
  • Inconsistent training – training is not consistently organized and delivered across all regions, resulting in gaps. The lack of consistency across regions creates an imbalance in learning which may result in different levels of awareness, knowledge, and preparedness across regions.
  • Lack of strategic direction and coordination in the development and execution of the National Exercise Plan. The plan has limited goals or objectives driving the purpose of the exercises and there is limited evidence of the dissemination and use of lessons learned.

Recommendation 1: The CCG should put in place nationally consistent policies, directives and documentation that clearly identify the CCG as the lead federal agency for all ship-source oil spills or pollution incidents in waters under Canadian jurisdiction. Ensure program documentation aligns with the national strategic direction on areas such as: mandate and role, training, and exercises.

STRATEGY

The Coast Guard has recognized the need and benefit of nationally consistent, but regionally tailored policies, plans, directives and guidelines, and much progress has been made in the ER Program, including:

  • Updated directives and standing operating procedures;
  • Updated national and regional contingency plans;
  • Development of a national training plan; and,
  • Development of a national exercise plan.

The Canadian Coast Guard has also established a periodic review process to ensure its national and regional emergency management plans remain accurate and relevant, and is co-leading with Transport Canada the implementation of four area response planning pilot projects to ensure that contingency plans at the local level are in line with stakeholder priorities and capabilities.

Given increasing public expectations that the Coast Guard is prepared to respond to all pollution incidents in a timely and effective manner, Coast Guard is working with federal, provincial and local response partners and stakeholders to ensure all parties involved understand their roles and responsibilities at the time of an incident, and is also aggressively implementing the Incident Command System – a system that many of the world’s leading emergency management operators employ.

The Coast Guard understands the importance of having well-trained pollution response experts, with well-established relationships with response partners and stakeholders. Exercises are an effective way to verify the success of training efforts, and also provide ideal opportunities to develop and maintain those critical relationships with industry and other participants. Coast Guard regularly conducts its own exercises, as well as those co-led with the United States Coast Guard, our Arctic Council partners, and other partners. Coast Guard also uses real-life pollution incidents as opportunities to verify that pollution response training is effective.

With limited personnel to conduct ER-specific exercises, the Coast Guard also takes advantage of the opportunities presented by industry and other partners to exercise their contingency plans as they provide excellent, cost effective opportunities to work with major industry players (e.g. oil and gas industry, Canada’s Response Organizations.)

Recognizing the need for improvement in the ER program, the Coast Guard has been working over the past year in developing and implementing a concept of operations for the Environmental Response Services Program that will ensure consistency in response operations, training and exercising and provide clarity of roles and responsibilities within Coast Guard, and with our partners.

MANAGEMENT ACTIONS DUE DATE (BY END OF MONTH) STATUS UPDATE: COMPLETED / ON TARGET / REVISED DATE AND REASON FOR CHANGE OUTPUT
Finalize the Concept of Operations for the Environmental Response program which includes:
  • Development of a National Environmental Response Manual with standardized policies, directives and procedures
  • Development of a national Training and Exercise Program that includes standards for training and certification of ER staff.
  • A quality assurance element to ensure the ongoing standardization and sustainability of the ER program.
October 2016
Finalize the Concept of Operations for the Environmental Response program which includes:
  • Implement the quality assurance process for the ER program.
October 2017

RECOMMENDATION 2

Rationale: Evidence indicates that few marine oil spill incidents have been cost recovered by the CCG. There is no guidance in place to determine when cost recovery should be pursued. Regions are responsible for preparing and submitting cost recovery claims and many key informants noted that a lack of support impacts their ability to submit claims.

Recommendation 2: The CCG should put in place measures to ensure that all appropriate claims are pursued for cost recovery. Further, the CCG should document a systematic process for determining when it is most appropriate to proceed with cost recovery.

STRATEGY

Canada’s marine oil spill preparedness and response regime is based on the polluter pay principle, whereby the costs associated with addressing the impact of pollution caused by a ship owner or other responsible party are their responsibility. The direction to all pollution response personnel and their management teams has been that reasonable efforts to recover the costs associated with Coast Guard’s clean-up actions are to be made. This includes seeking to identify and collect funds directly from the polluter, their insurer, or the Ship-source Oil Pollution Fund (SOPF). The cost to the Coast Guard of submitting claims currently is often higher than the funds recovered by the claim. In addition, the burden of proof to substantiate a claim to the SOPF is onerous.

The Coast Guard is not funded to undertake pollution response activities but rather solely the preparedness function; therefore, without the recovery of associated costs, the Coast Guard assumes the financial burden, and the polluter is not held accountable.

The Coast Guard receives an average of 1,200 reports of pollution annually, the majority of which require some level of response. Given the limited number of pollution response experts and high volume of work, sometimes decisions are made at the regional level to focus efforts on the recovery costs associated with the more expensive Coast Guard involvement.

The Coast Guard recognizes the finding that an additional 7% of incidents should be pursued for cost recovery due to their higher probability of return and that Coast Guard is successful in recovering almost all of its costs for those claims that are submitted (97%). Should the Coast Guard recover the 7% referenced through the ship-owner or the SOPF, it cannot be stated categorically that the costs incurred by the onerous and administrative burden of submitting claims would be recovered. Efforts to pursue these additional claims are being made presently.

However, to ensure ongoing cost recovery efforts are maximized and that the ‘polluter pay’ principle is upheld, the Coast Guard will develop standard operating procedures to direct regional ER staff in determining when a claim should be prepared and to whom it should be submitted. This requires the development of a costing model to generate standard costs for response activities in support of a ‘decision tree’ that will be used to guide cost recovery.

In addition, as Coast Guard continues to implement Incident Command System as its primary emergency management system, the information management system to support pollution response efforts will be considerably more effective in providing accurate and timely information on all Coast Guard response costs, improving our ability to submit claims in a consistent and efficient manner.

MANAGEMENT ACTIONS DUE DATE (BY END OF MONTH) STATUS UPDATE: COMPLETED / ON TARGET / REVISED DATE AND REASON FOR CHANGE OUTPUT
Document current cost recovery process to establish a baseline for costing analysis July 2016
Consult with ER Superintendents, and relevant partners, on the development of the ER costing model September 2016
Establish an itemized costing model that pre-determines standard costs for response activities, and a decision tree to facilitate an efficient and effective cost recovery process April 2017

RECOMMENDATION 3

Rationale: The Environmental Response program is operating independently from the other CCG programs. The program has some unique needs related to financial management, asset management, and training. The CCG has not had the capacity to support these unique needs. This has placed an increased burden upon existing Environmental Response personnel.

Recommendation 3: The CCG should ensure the program is provided with sufficient support to address the unique requirements of the Environmental Response program. In particular, ensure that Environmental Response personnel in the regions have the support needed to proceed with cost-recovery claims.

STRATEGY

The Environmental Response Program is managed and delivered to maximize available resources and ensure Coast Guard remains prepared to respond as required to marine pollution incidents. The Coast Guard recognizes the finding that assets are managed differently in the ER program, and an asset management plan has been developed. In order to make these additional enhancements to the management of program assets, including lifecycle management of ER assets, significant investments are required and Coast Guard will pursue all available opportunities to seek additional resources and support for the unique requirements of the program.

Moving forward, the Coast Guard is developing and implementing a concept of operations for the Environmental Response Services Program that includes dedicated, and unfunded positions responsible for cost recovery.

In addition, as Coast Guard continues to implement the Incident Command System as its primary emergency management system, the information management system to support pollution response efforts will be considerably more effective in providing accurate and timely information on all Coast Guard response costs, improving our ability to submit claims in a consistent and efficient manner.

MANAGEMENT ACTIONS DUE DATE (BY END OF MONTH) STATUS UPDATE: COMPLETED / ON TARGET / REVISED DATE AND REASON FOR CHANGE OUTPUT
Finalize the concept of operations for the Environmental Response Services Program. October 2016
Develop an information management tool for the Incident Command System which will be customized to include Coast Guard specific ER and cost recovery operational requirements March 2017
Implement the information management tool, including procedures and training. March 2018
The Coast Guard will work with the SOPF to articulate clear and predictable criteria for submitting claims. April 2017
The Coast Guard will work with Transport Canada to explore options for modernizing ER cost recovery as part of the Minister’s marine safety improvement mandate. April 2017