Archived - Government Response to the Standing Senate Committee on Fisheries and Oceans 2nd report: The Atlantic Snow Crab Fishery

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Preamble to Responses:

The Department of Fisheries and Oceans continues to pursue a modern fisheries management regime that promotes predictability, stability and transparency, and a strong and healthy fisheries resource for the benefit of resource users and all Canadians.

Fisheries Management Renewal (FMR) is a national approach to modernizing the way fisheries are managed on both the Atlantic and Pacific coasts. FMR seeks to implement the objectives that have been set through major public engagement exercises, including the Atlantic Fisheries Policy Review, Pacific New Directions and Pacific Fisheries Reform, and the Aboriginal Fisheries Strategy Review.

The first FMR objective is Strong Conservation Outcomes, to be achieved by working with resource users to develop risk management frameworks based on precautionary and ecosystem approaches, by modernizing the fisheries compliance regime and by improving fish habitat management. Achieving strong conservation outcomes depends upon a commitment to conservation from those whose activities impact upon the resource.

The second objective is Shared Stewardship, which is being achieved by promoting collaboration, participatory decision-making and shared responsibility and accountability with resource users and others. Shared stewardship means those involved in fisheries management work cooperatively – in inclusive, transparent and stable processes – to achieve conservation and management goals. DFO believes that enabling resource users to play a greater role in decision-making, and enabling them to take greater responsibility for resource management decisions and their outcomes, will increase their commitment to conservation and their ability to control their economic and social well-being.

Furthermore, because fisheries management oversees a public natural resource on behalf of Canadians, shared stewardship also seeks to include others with an interest in the resource in decision-making processes.

The third objective is Stable Access and Allocation. This is being achieved through greater security of access, stable sharing arrangements and transparent and predictable decision-making processes. Stable access and allocation will allow resource users to focus on conservation and economic viability issues, rather than focusing on securing their share of the resource.

The fourth FMR objective is Modernized Compliance, to be achieved by working with resource users to develop cooperative ways to ensure the rules of the fishery are being followed, without having to routinely resort to courts. This will require new compliance tools and approaches on a continuum ranging from education to enforcement, a priority setting/risk assessment response model, an expanded ticketing system and administrative sanctioning. A modernized compliance system will facilitate new relationships, promote shared stewardship and target systemic compliance issues.

Ocean to Plate Approach

FMR also provides a framework within which the department can work jointly with other jurisdictions and resource users to support an overall Ocean to Plate approach. An Ocean to Plate approach requires the federal government, provinces, fish harvesters and processors, and others with an interest in the fishery, to work together to develop agreement and direction on issues important to the prosperity of the fishery. It requires a legislative framework that fosters cooperation with the provinces and encourages the participation of Canadians in decision-making, and a solid set of tools that support the involvement of resource users in the management of the fisheries through agreements with organizations representing licence holders.

An Ocean to Plate approach also requires stable access to the resource, which is central to the economic viability of fishing enterprises, processors and the well-being of fishery-dependent communities. Economic viability and the "best use of fish" (in order to fulfill the fishery’s economic, social and cultural potential) are also factors that must be taken into consideration in access and allocation decisions. Furthermore, fair and transparent processes for licensing and allocation decisions, and the authority to provide longer term licences and allocations, will help the entire industry do better business planning, which in turn supports industry economic viability.

Bill C-45 – A Modern Legislative Framework for Fisheries Management

A modern legislative framework is crucial to successful fisheries management. Legislative changes to support FMR have been proposed in Bill C-45, An Act respecting the sustainable development of Canada’s seacoast and inland fisheries, which was tabled in Parliament on December 13, 2006. The goal of this Act is to provide a modern, transparent, effective and accountable legal framework for the sustainable development of fisheries and fish habitat, undertaken in co-operation with fishers, provinces, territories, Aboriginal groups and other Canadians.

RECOMMENDATIONS AND RESPONSES

RECOMMENDATION

1. The Committee recommends to the Treasury Board that the Government of Canada provide the Department of Fisheries and Oceans (DFO) withfunding to significantly improve scientific research on snow crab.

RESPONSE

DFO concurs with the committee that it should be continually reviewing its programs to seek improvements in scientific research on this important fishery resource, however, Treasury Board does not have the mandate to provide new funding to departments. Compared to other species under its mandate, the Department of Fisheries and Oceans (DFO) funds and conducts significant scientific research on snow crab. While expanded and improved research is desirable to more fully understand biological characteristics of this species, DFO considers that the level and quality of the work that has been conducted is adequate to meet the conservation requirements for this natural resource.

However, in recent years, an important part of the research work has been funded through partnership agreements with industry. Recent court decisions on the use of fish require that some of these collaborative funding arrangements be re-designed to comply with the existing legislative framework. As it may not be possible to negotiate new collaborative arrangements for some important research activities, the Department is currently examining solutions to address this issue.

RECOMMENDATION

2. The Committee recommends that the Minister of Fisheries and Oceans establish an Atlantic-wide Snow Crab Science Council in co-operation with the Fisheries Resource Conservation Council.

RESPONSE

In its 2005 report titled ‘STRATEGIC CONSERVATION FRAMEWORK FOR ATLANTIC SNOW CRAB’, the Fisheries Resource Conservation Council recommended that an Atlantic-wide Snow Crab Science Council be formed. The council would include scientists, industry and fisheries management to review science on snow crab on a regular basis to improve the flow of information and communication between administrative regions of Atlantic Canada and Québec.

DFO recognizes the need to maintain effective lines of communication and particularly to provide adequate review of scientific approaches, methods and information. In this regard, DFO’s existing Science advisory process coordinated by the Canadian Science Advisory Secretariat (CSAS) provides the ideal forum to facilitate such exchanges. In reviewing new methodologies, this advisory process fosters national standards of excellence, and exchange and innovation in methodology, interpretation, and insight. The DFO proposes that zonal workshops conducted under the auspices of CSAS would be an excellent method to facilitate these exchanges and meet the objectives of the proposed Atlantic-wide Snow Crab Science Council. The DFO considers that this approach would be both efficient and cost-effective.

There are many reasons to suggest this approach. First, the process is inclusive and as such can include various stakeholders, external scientists and fisheries managers who have scientific knowledge to partake. This peer-review process is based on principles of rigour and impartiality as well as openness and transparency with overall objective of providing the best possible science to the Minister, managers, Management Boards, stakeholders and the public. Finally, CSAS also coordinates communication of the results of the scientific review. Overviews, research documents featuring detailed scientific information, as well as proceedings of these peer reviewed meetings are readily available from CSAS and can be downloaded directly from its web site. This website is an excellent vehicle for the dissemination of scientific information and is already used extensively by DFO scientists, industry, fishery management and the public at large.

RECOMMENDATION

3.  The Committee recommends that the Minister of Fisheries and Oceans introduce amendments to the Fisheries Act to allow for the use of administrative sanctions to penalize offenders.

RESPONSE

Underlying an effective fisheries management regime is a modern compliance approach based on shared stewardship with resource users and on new tools that target systemic compliance issues. An administrative sanctioning regime will be an important element of such an approach. Bill C-45 proposes the creation of the arm’s-length Canada Fisheries Tribunal (CFT) to deal with infractions by licence holders in coastal fisheries.

The benefits of an administrative sanctions regime include effective deterrence, administrative fairness, credibility within the fishing community and operational efficiency. Dealing solely with the fishery, the CFT will develop special expertise in the adjudication of fisheries violations and an appreciation for the gravity of these infractions to stocks and resource users. The result will be a high level of public confidence in the system.

The CFT will operate independently from DFO, though reporting to Parliament through the Minister of Fisheries and Oceans. It will adjudicate contraventions of the Act or its regulations, as well as hear appeals of licence decisions. The proposal permits flexibility in application of the system – it could apply exclusively to commercial fishing licences, or also to Aboriginal communal and recreational licences. (The types of licences would be prescribed by regulation). Fish habitat offences, offences in the inland fisheries managed by provinces, and commercial poaching (unlicensed fishing) would remain in the court system.

Violations that could be handled by the CFT would be contraventions of a condition of a licence; a prescribed provision of the Act or the regulations; a fisheries management order; a condition of a fisheries management agreement; or an order of the CFT. Violations would be designated as either major or minor and would be prescribed by regulation. Minor violations would be dealt with through a ticketing procedure. Major violations would be dealt with through the CFT and, depending on the severity of a major violation, sanctions would range from fines up to a maximum of $30,000, to the forfeiture of seized boats, gear and illegal catches, to the short-term suspension or revocation of a fishing licence.

Implementation of the CFT could be phased in, starting with certain violations and then gradually expanding to cover more. Likewise, the Tribunal could be applied incrementally to certain fisheries, where there is a willingness and desire within the fishery to adopt such a system, and expanded over time to other fisheries.

RECOMMENDATION

4.  The Committee recommends that DFO collaborate closely with various crab fleets on an urgent basis to develop voluntary self-adjustment mechanisms to reduce fishing capacity where needed. In this regard, the snow crab fishery in Newfoundland and Labrador should be given immediate priority.

RESPONSE

As part of the temporary measures implemented in 2006, a ‘buddy-up’ arrangement was made available to all crab fleets in Newfoundland and Labrador (NL). This allows two licence holders to form a temporary partnership and fish both Individual Quotas (IQs) from a single vessel. In addition, the 12 month registration rule was lifted and a 1 month registration rule was implemented for 2006.  This allowed fishers greater flexibility to harvest more than one IQ with a single vessel.  These measures are seen as moving towards enterprise combining/rationalization.  However, permanent combining has not been implemented in NL. The NL region is currently engaged in a fisheries renewal exercise and it is expected that the issue of enterprise/licence combining will be explored as part of that process.

In the Eastern Nova Scotia snow crab fishery, sharing levels have been established at 60% for licence holders and 40% for quota holders. The decision to establish regular status and fixed shares in the fishery provides participants with certainty and stability. Fishing capacity can be decreased through quota transfers as well as through the development of partnerships under the licensing policy. By decreasing the number of enterprises on the water through the transfer of quota or through the formation of a partnership, the total number of traps in the water also decreases thereby reducing fishing capacity.

Under a regional program in Quebec, the number of snow crab licences has been capped and temporary allowances are made available according to the availability of the resource. Quota can be transferred, subject to the approval of DFO, to reduce the number of boats and traps and there is a rotation of fishers with temporary snow crab allocations. The Department will be consulting with industry on changes to the program prior to the 2007 fishing season. The consultations will focus on several elements such as program objectives, access, sharing, licensing rules and allocation transfers.

In the southern Gulf, in the context of stabilized access to the resource, the Department will be embarking on a consultation process with industry stakeholders to develop a multi-year approach to managing the fishery. It is anticipated that discussions will take place on fishing capacity and tools, which can be used to ensure that fishing capacity is in balance with resource availability.

RECOMMENDATION

5.  The Committee recommends that the Minister of Fisheries and Oceans announce publicly how he intends to follow through on the stated commitment to prevent the use of trust agreements which undermine the spirit and intent of the owner-operator and fleet-separation policies.  The Minister should also indicate what proposals he will make to facilitate licence transfers to a new generation of small-vessel fishermen.

RESPONSE

The use of "trust agreements" in Atlantic fisheries, in many circumstances, is in conflict with the spirit of the Owner-Operator and Fleet Separation policies which are meant to protect the independence of the inshore fleet in Atlantic Canada. A plan of action is being developed to support owner-operator and fleet separation policies that addresses those fleets that may be unduly disrupted by implementation of the plan.

With regard to the transfer of licences to a new generation of small-vessel fishers, changes to the Income Tax Act were announced in May 2006 to facilitate the transition of fishing operations from fishers to their children or grandchildren by allowing, in certain circumstances, a tax deferral. By deeming the fisher's proceeds of disposition generally to be the cost of the property transferred to the child or grandchild, any capital gain or loss is deferred until the child or grandchild disposes of the property.

In addition, fishers will be able to take advantage of the $500,000 lifetime capital gains exemption in respect of capital gains arising on disposition of their qualified fishing operations. This will facilitate retirement of individuals who wish to leave the fishery but who have been reluctant because of the tax burden on disposition.

These tax measures will help address both the demographic issues associated with the aging fish harvester workforce and some of the difficulties experienced by new entrants wanting to get into the fishery.

RECOMMENDATION

6. The Committee recommends that the Minister of Fisheries and Oceans ensure that the Department report on a biannual basis on what steps have been, and are being undertaken to implement Phase II of the Atlantic Fisheries Policy Review.

RESPONSE

Implementation of Phase II of the Atlantic Fisheries Policy Review is being undertaken as part of DFO’s Fisheries Management Renewal (FMR) process. General progress on FMR is reported in the annual Departmental Performance Report. However, there are myriad advancements of a routine nature or at a more detailed or operational level, and regular communication of these achievements would be useful to support the renewal agenda. In order to increase transparency and demonstrate accountability, the department is considering the most effective way to regularly communicate FMR implementation to resource users and others with an interest in the fishery.

In the meantime, the substantial progress made on FMR during 2006 and planned for 2007, is outlined below.

Conservation and Sustainable Use

The first FMR objective is to ensure that conservation and sustainable use of the resource is the first priority in fisheries management decision-making. This goal is to be achieved by working with resource users to develop risk management frameworks based on precautionary and ecosystem approaches.

Integrated Fisheries Management Plans (IFMPs) are the fundamental fishery tool for managing the delivery of a fishery.  Since the early 1990s, significant work has been done to develop IFMPs to respond to the needs of a modern fishery. IFMPs now clarify fisheries management objectives, set out multi-year plans for the development and management of an orderly fishery, and incorporate biological, economic and social factors. IFMPs are developed in cooperation with resource users and will continue to evolve to reflect the precautionary and ecosystem approaches.

Ecosystem Approach

Adopting an ecosystem approach to fisheries management involves better understanding and managing the cumulative impacts of fishing and taking into account the effect of the environment on fisheries resources. A comprehensive ecosystem approach involves taking account of, among other things:

DFO is developing the necessary building blocks to take an ecosystem approach in fisheries management. The emerging approach includes data collection on various elements of ecosystems, setting clear ecosystem and management objectives and the development of decision tools. It will be supported by policies on forage species, emerging fisheries, sensitive benthic areas, by-catch and others, and will be delivered through IFMPs. The policies on forage species and emerging fisheries have been completed and the sensitive benthic area policy is nearing completion.

Precautionary Approach

A precautionary approach (PA) is a method of managing risks of serious or irreversible harm where there is scientific uncertainty. It involves setting biologically-based reference points and establishing pre-agreed risk-based actions to be taken at those reference points well in advance of a fishery in order to avoid the stock being reduced to a state of serious harm. For each stock in question, these systems will be established in consultation with resource users.

DFO has completed several years of work on the elaboration and discussion of the PA and its application to fisheries in Canada.  PA reference points have been identified for over a dozen marine fisheries in Canada and these are used to guide management actions. For example, reference points are used in the management of Barkley Sound Sockeye Salmon on the west coast and in Gulf Herring and Harp Seals on the east coast. The next step is the staged implementation, in concert with the fishing industry, of a fishery decision framework that incorporates the PA in all marine fisheries in Canada.

Shared Stewardship

The second FMR objective is to promote shared stewardship of the resource with resource users and others. The legislative amendments in Bill C-45 will substantially advance shared stewardship. First, in the preamble of the bill, the importance of continued cooperation with provinces and territories and the importance of the public and industry taking a greater role in decisions regarding the future of Canada’s fisheries are noted. Second, the application principles, which govern all decisions that the Minister and every person engaged in the administration of the Act must take into account, include considering traditional knowledge, endeavouring to act in cooperation with other governments and with bodies established under land claims agreements, and encouraging the participation of Canadians in the making of decisions that affect the management of fisheries and the conservation or protection of fish or fish habitat. These application principles recognize the role of others (e.g. public, industry, provinces and territories) in the management of the fisheries, which is the fundamental basis of shared stewardship. By enabling others to take on more responsibility regarding management decisions, DFO believes that their commitment to conservation and their economic performance will be thus increased.

Further to the preamble and application principles, a number of legislative authorities have been proposed that would strengthen shared stewardship. For example, the Minister would be given authority to enter into legally binding agreements (Fisheries Management Agreements) with Aboriginal organizations, commercial fleets and recreational fishing organizations enabling them to take on a greater role in the management of the fisheries. Another authority proposed is to allow the Minister to enter into agreements with Provinces/Territories to foster greater cooperation between governments and to address issues that are important to the prosperity of the fishery. As well, the Minister’s authority to create advisory panels with respect to the management of the fisheries will facilitate greater public participation in decision-making.

Shared stewardship was also advanced during 2006 through existing processes and through a series of summits and roundtable meetings held with Provinces and industry groups throughout Atlantic Canada.

Work with the Provinces/Nunavut on specific fisheries issues continued through the Task Groups set up under the Canadian Council of Fisheries and Aquaculture Ministers. Both the Task Group on Snow Crab and the Task Group on Shrimp prepared Reports following their in-depth studies of each fishery.

Summits and Roundtables began with the "Canada – Newfoundland and Labrador Fishing Industry Renewal Initiative" in May 2006. Five industry/government committees were established to examine industry renewal policy options. Consultation meetings were held, and input solicited, until December 2006. A summary of the findings will be brought to both federal and provincial Ministers in early 2007.

The "Summit on the Northumberland Strait Lobster Fishery" was held in July in Charlottetown. The Minister and Deputy Minister met with Ministers and Deputies from Nova Scotia, New Brunswick and PEI, fishing organizations, processors, Aboriginal groups and others with an interest in the fishery. Three working groups were created and expect to report in March 2007.

The "Maritimes Region Fishing Industry Roundtable on Industry Viability" included senior managers from DFO, Nova Scotia and New Brunswick and industry participants from the harvesting and processing sectors. Five issue areas were discussed and next steps for these areas were developed. This Roundtable was billed as an initiation of a dialogue on economic viability, and further Roundtables are expected to follow-up on the next steps.

A Roundtable was also held in Quebec in November. The "Forum québécois des partenaires des pêches" included the federal and provincial Ministers and Deputies and industry associations. Task Groups were established to address priorities related to quality, marketing, harvesting and processing, and were mandated to develop strategies, by March 2007, to ensure the long term economic viability of the Quebec fishing industry with a focus on the 2007 season.

Stable Access and Allocation Approach

The third FMR objective is to ensure stable access and allocation and predictable and transparent decision-making processes, which is a starting point for improving relationships with industry, other stakeholders and resource users. Improved relationships will facilitate increased participation of resource users in conservation, stewardship and the management of the resource, which will in turn improve their self-reliance as it will provide them with a greater role in shaping economic objectives.

So far, existing sharing arrangements in most Atlantic fisheries have been stabilized for the past two seasons for up to five years, and open and transparent processes with appropriate criteria are currently being used to address outstanding sharing arrangement issues. As a result of the AFPR discussions which culminated in 2004 with the "Policy Framework for the Management of Fisheries on Canada’s Atlantic Coast", DFO identified the concerns of many inshore fleets with respect to "trust agreements" as a subject for future work. Some licence holders see Owner-Operator and Fleet Separation policies as being eroded by "trust agreements". Others see these policies as impediments to rationalization and viability. DFO is developing a plan of action to support the Owner-operator and Fleet Separation policies that addresses those fleets that may be unduly disrupted by implementation of the plan.

Bill C-45 proposes substantial changes to increase stability in the access and allocation approach. First, the Act recognizes that stable access to fisheries resources is central to the economic viability of fishing enterprises, processors and to the well-being of communities dependent on the fisheries. The Act also requires the Minister to take into account the importance to fishers of secure access to the fishery and of allocation stability when exercising powers related to fisheries management. Furthermore, the proposed licensing system ensures a greater transparency in decisions by providing the context (policy) in which all licence decisions are made. Resource users are assured that licences are issued according to established rules and criteria approved by the Minister, which provides a greater degree of certainty and stability for industry.

The repeal of clause 7(2) of the current Fisheries Act, which places limits on the duration of licences, will provide the Minister with authority to set into licensing policy longer-term licences. Transparency is further increased by having licence appeal decisions handled at arm’s length from the department through an administrative tribunal.

Modernized Compliance

The fourth objective is to develop a modernized compliance regime that facilitates new relationships, promotes shared stewardship with resource users and communities, and targets systemic compliance issues. This requires developing cooperative ways to ensure that the rules of the fishery are being followed, without having to routinely resort to courts.

Considerable progress has also been made in achieving this objective. A comprehensive compliance review is underway, which includes work on risk management and priority setting and optimizing use of tools and approaches. While the department continues to pursue modernized compliance practices, legislative changes, such as those outlined in the response to recommendation 3, have been proposed to achieve this objective, particularly through the introduction of an administrative sanctioning regime.

Furthermore, Bill C-45 supports a modernized compliance regime by strengthening the department’s ability to ensure compliance with the legislation and regulations. Bill C-45 includes clarification of the rules and responsibilities of Fisheries Officers, Fisheries Guardians and Habitat Inspectors; clear delegated enforcement authorities to the Provinces; enhanced ticketing regime for infractions; and authority to enter into Alternative Measures Agreements.