Fisheries Committee on May 8th, 2007

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

But exclusive to the members in that particular organization, right?

[The Chair, Conservative, Gerald Keddy]

You are splitting your time, Mr. Simms.

Mr. Matthews.

[Bill Matthews, Liberal, Random—Burin—St. George's, NL]

Thank you, Mr. Chairman.

I'd like to welcome our witnesses and thank them for coming.

My question on resource management would probably go to Mr. Stringer.

I'm sure you're very much aware of the situation in Newfoundland today with the requests to transfer FPI's groundfish quotas. I guess you're familiar with the Arnold's Cove situation a couple of years ago. Could you explain for the committee what the difference was with the Arnold's Cove transfer of quota allocation? It was National Sea's, and it became someone else's.

At the same time, maybe you could inform the committee of the arrangement for the P.E.I. shrimp allocation that Minister Dhaliwal gave a few years ago and how that differs from the current request.

[Larry Murray]

If I might be permitted, Mr. Chair, I wouldn't mind setting a context for this.

The minister has met with all interested parties. We met on Sunday afternoon. We have officials. Mr. Bevan would be here today, but he's in Newfoundland working closely with the province and everybody involved to try to find a solution to this issue before the strike deadline on Monday. The minister has been personally engaged on Sunday, yesterday, and today.

So as for how far we go on this one at the moment, it's obviously sensitive. I would say certainly the scale is part of the issue. The scale of the groundfish allocations we're talking about is 20,000 tonnes, with tremendous potential for very significant growth. Certainly given the federal government's responsibility for managing the quota, for managing the fishery, there are concerns from other provinces in terms of how this unfolds.

Having said that, the minister is very committed to finding a solution, to working with the province, to working with the other stakeholders to finding a solution by the end of the week that works for everybody, and we're certainly working on that one full time.

Kevin, do you want to say a few words about Arnold's Cove?

[Kevin Stringer]

Arnold's Cove was a unique situation, and often with the fisheries there are unique situations. A number of companies came together. There was an agreement by all parties that they knew who they wanted to hold the quota and process the quota. The NLIDC, I think, is the name of the crown corporation it was run through. It's for a pretty small amount of fish. I can't remember the exact amount.

[Larry Murray]

Two thousand tonnes.

[Kevin Stringer]

It's 2,000 tonnes, so in terms of order of magnitude, it was significantly different from what we're dealing with today. In any case, it had that unique set of circumstances, and we're looking at today's circumstances, as the deputy said, based on the current arrangements.

[Bill Matthews, Liberal, Random—Burin—St. George's, NL]

I totally understand that, and we all want a solution by the end of this week. Don't read me wrong on that. I wish we'd had one six months ago. I think we should have had one.

This group that holds the Arnold's Cove quota, I call it, what's the makeup of that? Who are they?

[Kevin Stringer]

I have to have more details, but my understanding is that the group that received the allocation or the licence is the NLIDC, which is the Newfoundland and Labrador IDC. I'm not sure what it is, but it's a crown corporation and it subleases to Arnold's Cove; that's the arrangement.

[Bill Matthews, Liberal, Random—Burin—St. George's, NL]

So was there a money transfer?

[Kevin Stringer]

I don't know the answer to that.

[Bill Matthews, Liberal, Random—Burin—St. George's, NL]

A figure of $3 million sticks in my mind, but I'm not sure if that's correct.

[Larry Murray]

My understanding is there was. Bruce Wareham runs Arnold's Cove, and it was really important to keep that community going, and I believe part of the transfer of funds was around the quota. A transfer of funds was involved, and we can confirm that. I think your number is my understanding as well, but I'd rather confirm that as opposed to estimating.

[Bill Matthews, Liberal, Random—Burin—St. George's, NL]

Was this a similar arrangement to the P.E.I. shrimp? Can someone inform me of that? Or how does that differ?

[Kevin Stringer]

My understanding of the P.E.I. shrimp is that it was simply an allocation by the minister of the day to a consortium in P.E.I., period.

[Bill Matthews, Liberal, Random—Burin—St. George's, NL]

A consortium, a consortium of companies, you mean, not including government?

[Kevin Stringer]

I'm not sure if it is.

[Larry Murray]

I think the government is involved. I'd want to be clear as well that the decisions we're talking about were decisions of previous governments, not the decisions of this minister. This minister has made it very clear in the shrimp allocation decision late last year or earlier this year, that fish, from his perspective, is about people involved in the fishery, people involved in fishing enterprises. So the shrimp allocation went to the fishing industry, and that's how he sees it.

[The Chair, Conservative, Gerald Keddy]

Thank you, Mr. Murray.

Thank you, Mr. Matthews.

Monsieur Blais.

[Raynald Blais, Bloc, Gaspésie—Îles-de-la-Madeleine, QC]

Thank you, Mr. Chairman.

Let us move on to another unique situation, because there are several of them that are up in the air. I would like to make a short comment about the shrimp file. There is talk of a possible strike in Newfoundland. However, people have been in the street since yesterday in my riding, in Gaspé to be more precise. They are doing sit-ins in offices or demonstrating, not out of joy, not for the sake of it, but because they are in crisis. I had the opportunity to discuss the situation not too long ago with Mr. Murray, Mr. Bevan and Mr. Hearn.

Seriously, the Department could intervene in this case, except that, from what I understand, it tends to view things according to a horizon of several years down the road. Unfortunately, the situation is such that it is erupting today. Each week, more people will find themselves without any income. Already, some of the plant workers are starting to feel the pinch and are without any income. Their numbers will only grow over time. With regard to this file in particular, I am somewhat of a spokesperson for the people of my riding. This is a cry for help. Something must absolutely be done immediately...

And not only will workers be without income because employment insurance only lasts for a time, but all of the shrimp quotas, all of the millions of pounds of shrimp that are today processed in Newfoundland... I imagine that if the reverse were to happen, there would also be talk of a crisis. In any event, the situation is worsening day by day.

Mr. Murray, I have had the opportunity to inform you of this situation several times already and I was wondering if today you had any good news, with regard to action being taken, to announce to us.

[Larry Murray]

It is unfortunate, but the real question is one of price. The prices paid by the processors in Newfoundland and New Brunswick are much higher than they are in Quebec. I do not know why that is the case. The fishers also have two choices, they can go to Newfoundland or to New Brunswick, but not to Quebec. It is not the role of the government to determine the price in each province. I sympathize, especially with the people in the plants. It is truly sad.

[Raynald Blais, Bloc, Gaspésie—Îles-de-la-Madeleine, QC]

It is however possible to intervene with regard to the cost of the licences, not withstanding the negotiations between the processors and the fishers. That is part of a negotiation process, which is one element. The Department has admitted that the situation is problematic as far as the cost of the licences for the crab industry is concerned. There is therefore some means of intervening.

Rather than waiting for the process to simply evolve on its own, might we not have a pilot project or something else along those lines that would allow us to resolve the crisis immediately and them come back to the issues at hand? You have already recognized that the situation with regard to the cost of the licences is a difficult one. I am not talking about the price of shrimp or anything else, but of the cost of the licences. You have acknowledged the difficulty. There is a crisis within this industry and the cost of licences is very steep. This is where I see a way of intervening.

[Larry Murray]

For the moment, it is difficult to intervene, because when the discussion was launched, the price was around 38¢ a pound, whereas it is now at approximately 50 or 57¢ in Newfoundland. The federal government has to wonder who will get support, the processors or the fishers? It is not clear why the price in Newfoundland and New Brunswick is so high. The difference, based upon our analysis, should be closer to 3¢ a pound. That is why it is really not the answer.

Kevin, would you have something to add?

[Kevin Stringer]

As the deputy minister has said, we are deeply concerned, but in the end, we believe that for the time being this is an issue for the fishers and the processors. As you know, and as the deputy minister has stated, a few of the Quebec boats are unloading their catch in Newfoundland and are getting, from what we are being told, around 56 or 57¢ a pound. In Quebec, they were offered much less, around 45¢ a pound to be more precise. This really is an issue involving those two parties. We are aware of what is happening in Gaspé and we are concerned. We are following the situation very closely. I do not know if there are discussions under way with the demonstrators, but it is difficult for everyone.

As the deputy minister also stated, we have begun a review of the cost of licences. This will take time, but it is very difficult to reduce the cost of licences for a given group when all of the others are faced with similar situations and could very well tell us that it is much more difficult for them. We believe that the best thing to do is to work with them on the regional shares — they have asked for that —, the temporary lessees, and to make the changes we are able to make, but it is difficult in the short term to change the cost of licences.

[The Chair, Conservative, Gerald Keddy]

Thank you, Mr. Stringer.

Thank you, Monsieur Blais. You are over time by 42 seconds.

Mr. Stoffer.