Fisheries Committee on May 5th, 2009

[Randy Kamp, Conservative, Pitt Meadows—Maple Ridge—Mission, BC]

You are talking about specific projects, as I understand it. Where I'm still a little unclear is on the whole process of giving notice of ACOA's involvement with CCFI.

In your report and in other testimony, we hear about the sustainability plan. Somebody asked CCFI, I guess, for a sustainability plan. I'm not quite sure what that is. Were you expecting to get something back from CCFI that stated their intention to go forward without funding from the federal government, or at least from ACOA? Is that what you expected by asking for a sustainability plan? Was this a way of giving notice that ACOA was no longer going to fund them?

[Richard Comerford]

The requirement for a sustainability plan was placed in the last letter of offer or the last contract we had with them. Prior to this, about three years prior.... Again, this issue of becoming sustainable, and ACOA's ability to carry on and do this forever, has been an issue for about eight or ten years.

Based on discussions we had with them back about five years ago, they hired a consultant to do, I guess, a report on the options or the alternatives to their organization's structure. After looking at all the options, they came back and said that they liked what they had. They liked the status quo.

When they came back with that, we told them then that this was just not practical. It was not a way of continuing to carry on business, but it seemed to be that they'd looked at some other options and inevitably came back to ACOA for pretty much the full measure of their funding requirements. The term “sustainability plan”, to me, would almost by definition imply that if somebody tells you to become sustainable, you're not expecting them to come back and say, “Give me some money, and I'll be sustainable.” That is the way we looked upon it.

We had certainly communicated that to the Marine Institute or the university. We had communicated it to the board members, or the chairman of the board, and to Mr. Bonnell on a number of occasions.

[Randy Kamp, Conservative, Pitt Meadows—Maple Ridge—Mission, BC]

At that time, you expected to get back from them a sustainability plan, either then or even now or in the very near future. You saw a plan from them that made it clear that the operating costs were going to be from a different source of revenue, perhaps from the provincial governments or maybe from some other independent source, for example. But they would still want, say, $1 million a year for projects, as they've had up to now.

Would ACOA find that kind of model an acceptable one or one that they would consider participating in?

[Richard Comerford]

I guess, from ACOA's perspective, we shifted our focus in terms of how we deal with innovation six or seven years ago, when we established the Atlantic Innovation Fund.

The Atlantic Innovation Fund has had tremendous take-up. It has been oversubscribed. We have a lot of very worthy projects that are not competitively getting funded, because there are better projects. So one of the considerations we had to think about was whether we could get more resources for things like the Atlantic Innovation Fund.

From our perspective, the money we have that we can dedicate to innovation would be directed towards the Atlantic Innovation Fund and that particular method of delivery. It is a matter of choices, to a degree, and we feel that the role played by the CCFI, 20 years later, two decades later, has been accomplished. The industry and the institutions know each other. The importance of innovation in the milieu of fisheries development and that sort of thing has been acknowledged. Our approach has been to concentrate more on AIF, by default. Things like CCFI should be funded elsewhere.

[Randy Kamp, Conservative, Pitt Meadows—Maple Ridge—Mission, BC]

Thank you, Mr. Chair. Mr. Weston might have a question.

[The Chair, Conservative, Rodney Weston]

Go ahead, Mr. Weston.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you again for coming.

Let me first reiterate what my colleague Mr. Byrne said earlier. In times of economic uncertainty, innovation's going to be the key that allows us Canadians to compete in every sector--fisheries and otherwise--and I think everyone in the room agrees with that.

I have three parts leading to a question. The first thing, Mr. Comerford, is that it has been said widely in the discussion that the notice was at least ambiguous, that it was left open to interpretation whether funding was going to be cut off and whether there was ever an opportunity to continue. If the institute came up with some alternative funding, perhaps there was at least a door open. That's the impression that was certainly left with CCFI's chairman, according to his testimony.

The second part of this question I'm leading to is, what flexibility is there in ACOA's programs to change somewhat the terms that might allow the door to be open?

The third part of the question is this. Is there a possibility of a new deadline with new terms that would say to CCFI, if you can come to us within a certain period presenting conditions that would be acceptable to ACOA, that would promote innovation, and that would help us compete better internationally, then here's your last chance? Is that even a possibility?

[Richard Comerford]

With respect to the ambiguity around what notice we gave them, I suppose if somebody wanted to cast it that way, they could, but from our perspective--and I can speak first-hand to much of this--there was very little ambiguity in the discussions we had with the representatives of the university. The reason we would deal with the university in a matter like that as opposed to dealing with the board of directors of the CCFI is that it is the university that would be left holding the bag, shall we say, if the funding to the CCFI didn't come from ACOA. Then the university would have to somehow deal with that, because there'd be ongoing expenses and that sort of thing. So that's why we would have discussed it with the university.

Clearly, the identification of the last package of money, the $1.5 million, came after a great deal of working with the institutions to try to find a way around all of this. So it wasn't like one day somebody got a letter and that was it. This was over a period of time and with a lot of interchange back and forth.

As far as ambiguity goes, in my view, there's very little ambiguity. There may have been some disbelief or non-acceptance, but I don't think there was ambiguity.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Let's just say that there was no written letter that said, as of a certain date, funding will cease. Perhaps letters like that will go out in future from ACOA, but there wasn't one here. So at least some people might say there was ambiguity, whether you agree or not.

Let's move on to the other two parts, because I think we could get stuck on the notice indefinitely.

[Richard Comerford]

Regarding the flexibility in our programming, there are a couple of things here. We have to deal with the programs that we have and budgets that we guess at. When we look at a program, like any department, it comes with terms and conditions as set out by Treasury Board. They turn into rules and guidelines, and we basically try to tie what the funding was intended for to how the funding gets spent.

It's probably too detailed for me to get into each our programs, but we clearly evaluated the potential for funding for CCFI against our three main tranches of programs and found that it was not a good fit. In the case of the Atlantic Innovation Fund, other projects that were closer to the criteria were beating CCFI, and when they were measured up against each other, it didn't measure up. In the case of our other programs, for example with our community programs, the money has to be spent in the community that's being affected. We just introduced a new Community Adjustment Fund, but that money has to be spent in the communities being affected.

For the most part, the money spent by the CCFI is spent within the institutions that are in communities like Halifax or St John's.

I'm just scrolling through our programs now in terms of what the issues would be with CCFI and those.

Then there are the other programs, the ones that we use to support businesses, to help them to expand and modernize and that sort of thing. Right now the demand that has been placed on those programs as a result of the general shrinking in credit and that kind of thing has really limited our ability to take money for that purpose and divert it to this purpose.

In terms of whether we have the flexibility, we might have it in the rules, but we don't have the budget or we have other priorities or something like that.

[John Weston, Conservative, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

It's good to hear that it was a rigorous assessment and you've come to the conclusion based on well-reasoned analysis. I think that's what the committee needed to hear.

[Richard Comerford]

Thank you.

[The Chair, Conservative, Rodney Weston]

Thank you, gentlemen.

I've been asked if we could provide for one more round of one minute each. Is everybody okay with that, to see if we can keep it to one minute? We've allotted one hour, and we have a little over five minutes remaining in the hour for Mr. Comerford.

Mr. MacAulay, one minute.

[Lawrence MacAulay, Liberal, Cardigan, PE]

Thank you very much, Rick. It's good to have you here.

First of all, I understand quite well that you're implementing the decisions of government. You have to implement what's put before you, and I fully understand that.

Given the understanding that practically everybody involved in the fishing industry, letters from government members from all sides of the House, and the industry itself support this funding, is there anything illegal about this funding being extended for a year? Somebody gave CCFI the direction to go out and get funding from the provincial government, which they did, and the funding was cut from 100% to 50% over time. All I want to know is whether there is anything illegal or inappropriate about extending the funding. It's a government decision to extend or not extend the funding. This is very important to the fishing industry.

[Richard Comerford]

I'm not sure whether the term “illegal” is the best one to use. I guess what it boils down to is whether, given the choices for limited funding, this is one that you would want to make the choice to provide the funding to.

It's not as much a legal issue, in my view, as it is.... After reviewing the program criteria that we have right now, I don't see a way we could do it with the programming that we currently have.

[The Chair, Conservative, Rodney Weston]

Thank you.

Monsieur Lévesque, did you have a question you would like to ask?

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

Thank you, Mr. Chair.

First, Mr. Comerford, I want to verify something. If I understand correctly, the Atlantic Canada Opportunities Agency receives all funding for economic development, research and innovation for the Atlantic region.

Are you then the only organization with the power of life and death over the other small organizations operating under your umbrella in research and innovation? Similarly, please explain why, too, the Department of Fisheries and Oceans has confidence in the CCFI, as do the various Atlantic provinces, but ACOA does not.

[Richard Comerford]

As far as ACOA providing funding for innovation in Atlantic Canada is concerned, we do. We have programs providing that funding. We do it for very specific projects that have specific outcomes and partners and legal agreements, and those sorts of things. As for whether we control all of it, I don't think so. The provincial and federal departments with a mandate specifically for fisheries development would also be involved in this.

I'm not sure I understand your reference to DFO trusting CCFI and our not trusting them. I don't think anybody has ever suggested that we don't trust CCFI. I think our position is that the role we wanted CCFI to play was making the industry familiar with the institutional capacity and allowing it to become familiar with that institutional capacity. That was our objective in getting involved with CCFI. Obviously, as years go by and people become more familiar with things and do things in different ways, that has been accomplished.

I think the message here from ACOA—and it may still be the case that other government departments would have an interest in the ongoing work they do—is that our main motivation was to act as a catalyst and to use our funding to get them together. Then, once they saw how good it was, they would carry on by themselves. That was the thinking behind this.

[The Chair, Conservative, Rodney Weston]

Thank you, Mr. Comerford.

Mr. Allen.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much, Mr. Chair.

I have a really quick question. If I understand correctly, the last major funding round came out of the Innovative Communities Fund. Is that correct? Wasn't that A-base funding, if you will? It was under the Innovative Communities Fund, which typically doesn't go long term, but just supports community projects.

If that's true, and since we've had a lot of press and a lot of things said on this specific issue—and I know the province received money before out of the community development trust—has there been any approach by the provinces to ACOA to develop some kind of partnership going forward to keep this thing going? Have the provinces expressed their interest in that?

[Richard Comerford]

We've talked to the provinces—in my case, the Province of Newfoundland primarily—and our other offices have talked to the other provinces. There certainly has not been any approach by the provinces to ACOA to do something jointly.

My understanding is that based on the assumption that the federal government was going to put in $1.3 million per year for five years, the provincial governments undertook to make a commitment of about $300,000 or $400,000 in total, for the same period. The provincial government did express some interest in getting more involved, but they didn't really approach us to do it on a joint basis, or something like that.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

They haven't done that since they found out that ACOA was not going to support it.

Have they come back to you since?

[Richard Comerford]

Well, they've left it out there. I guess we could react to that if we wanted to. Again, I'll go back to our point that given the way the university community and the fishing industry have found themselves, or found each other, the need to do this at that cost is, from our perspective, not something we feel we need to support. If others with a mandate closer to fisheries development did, then that would be their choice.

[The Chair, Conservative, Rodney Weston]

Thank you, Mr. Comerford.

On behalf of the Standing Committee on Fisheries and Oceans, I'd like to thank you for coming today to speak to the committee on this issue. We really appreciate your time and your forthrightness. Thank you very much, Mr. Comerford.

The committee will now take a brief break and we'll proceed into an in camera session.

[Proceedings continue in camera]

[Public proceedings resume]

[The Chair, Conservative, Rodney Weston]

Order, please.

Mr. Byrne, did you want to move your motion at this time?