Fisheries Committee on May 2nd, 2013

[The Chair, Conservative, Rodney Weston]

I'll call this meeting to order.

I apologize for starting late this morning. Obviously it's beyond our control with the votes in the House.

Before we begin, Mr. MacAulay would like a moment to provide a notice of motion.

Mr. MacAulay, the floor is yours.

[Lawrence MacAulay, Liberal, Cardigan, PE]

Thank you, Mr. Chair.

I'd like to present the following motion:

That, due to the significant concerns over the sustainability of Canada's search and rescue services raised by the Spring 2013 Report of the Auditor General, the Standing Committee on Fisheries and Oceans immediately undertake a study on the Canadian Coast Guard's search and rescue capabilities and challenges to be tabled in the House of Commons no later than June 2013, and begin the study by calling Auditor General Michael Ferguson and Minister of Fisheries and Oceans Keith Ashfield as witnesses.

Then I would like to present another motion.

[The Chair, Conservative, Rodney Weston]

Mr. MacAulay, thank you for providing your notice of motion. Certainly it will be in order as early as Tuesday of next week. We'll deal with it at that point.

You now have another notice of motion, Mr. MacAulay?

[Lawrence MacAulay, Liberal, Cardigan, PE]

I'd also like to present a motion that this committee have the Department of Fisheries and Oceans officials return to the committee on Tuesday because of this report: the shortage of time we have to give it justice, to get answers on a lot of the changes and cuts that have been taking place, and to understand exactly where the department stands with these massive cuts.

Thank you, Mr. Chair.

[The Chair, Conservative, Rodney Weston]

I believe at this point in time, Mr. MacAulay, you're moving a motion that this committee ask officials to return on Tuesday to appear before this committee.

You don't have to give notice, because it is the subject at hand. That motion is on the floor at this point in time.

I take it you're moving that motion, Mr. MacAulay?

[Lawrence MacAulay, Liberal, Cardigan, PE]

Yes, I am. I so move the motion, Mr. Chair.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. MacAulay.

It has been moved by Mr. MacAulay that this committee ask the department officials to return on Tuesday to continue the discussion on the subject matter at hand, the 2013-14 report on plans and priorities.

Is there anything on the motion, or any debate?

Mr. MacAulay.

[Lawrence MacAulay, Liberal, Cardigan, PE]

I just feel, Mr. Chair, looking at, for example, the slashing of the small craft harbours budget and a number of other cuts to funding, that it would be a very....

We only have a little over an hour to deal with the officials in order to get the answers to the questions that we and the public and the people involved in the fishery need to have. I think it's very important that this fisheries committee get the details from the Department of Fisheries on where in fact we stand with the changes taking place in the next couple of years, as presented by the government.

[The Chair, Conservative, Rodney Weston]

Thank you, Mr. MacAulay.

Mr. Donnelly.

[Fin Donnelly, NDP, New Westminster—Coquitlam, BC]

Thank you, Mr. Chair.

I think it's a good motion, and it makes sense. Unfortunately, our votes cut into half the committee time, and there are quite a few issues that need attention.

I know we could certainly use more time with the officials here. There are just too many issues right now, especially given that the department received the most cuts, or certainly was very affected in the last budget.

So I think this motion makes sense. We'll certainly be supporting it.

[The Chair, Conservative, Rodney Weston]

Thank you, Mr. Donnelly.

Mr. Kamp.

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

Well, it seems a little strange to me that while we're debating this, we're taking up the time we would have to be asking the very questions he wants to ask.

And in fact, Mr. MacAulay gets more time than any other single member on this committee to ask those questions when the time does come.

You know, we had that opportunity as well on main estimates. That was the primary place to be asking those questions. We did ask those, and we have the opportunity today as well.

So I don't think we'll be supporting this motion.

[The Chair, Conservative, Rodney Weston]

Thank you, Mr. Kamp.

Is there anything further on the motion?

Mr. MacAulay.

[Lawrence MacAulay, Liberal, Cardigan, PE]

I thank Mr. Kamp for his...not for indicating that they will not support the motion, but for indicating that the way the committee is set up, and the way this fisheries committee has operated, not only now but over the years, is that we've issued a lot of reports as a committee, mostly with all-party support.

And I do know that the set-up is quite fair. I hope this interjection does not change my standing with the committee.

Thank you very much, Mr. Chair.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. MacAulay.

Is there anything further on the motion?

Mr. Donnelly.

[Fin Donnelly, NDP, New Westminster—Coquitlam, BC]

I'd like a recorded vote.

(Motion negatived: nays 6; yeas 5)

[The Chair, Conservative, Rodney Weston]

We'll now move to our committee business today.

We have before us officials from the Department of Fisheries and Oceans, who are here to answer questions and make a presentation on the 2013-14 report on plans and priorities.

I believe, Mr. Balfour, you're going to make an opening statement, and then you're going to turn the floor over to Mr. Huppé to complete the presentation on behalf of the officials.

Mr. Balfour, the floor is yours. I'd ask you, Mr. Balfour, to introduce the associates with you here today as well. Thank you.

[David Balfour, Senior Assistant Deputy Minister, Ecosystems and Fisheries Management Sector, Department of Fisheries and Oceans]

Thank you, Mr. Chair.

Given the late start, I'm going to dispense with opening remarks. I'll introduce my colleagues, and then I'd ask Mr. Huppé to give you a bit of an overview of our report on plans and priorities in order to enable the discussion to follow.

With us is Trevor Swerdfager, our assistant deputy minister for program policy; Jody Thomas, our deputy commissioner of the Canadian Coast Guard responsible for operations; Mr. Michel Vermette, deputy commissioner of the Canadian Coast Guard responsible for vessel procurement; Mr. Roch Huppé, our CFO; Kevin Stringer, our assistant deputy minister for ecosystems and ocean science; and France Pégeot, senior assistant deputy minister for strategic policy.

With that, I'm going to ask Mr. Huppé to go through the overview of our RPP. I believe you've all received a copy of the presentation.

Mr. Huppé.

[Roch Huppé, Chief Financial Officer, Department of Fisheries and Oceans]

Merci, monsieur le président.

I will briefly walk you through the small deck you would have received. I will provide you with an overview of the structure of the RPP, what is in there, basically, and provide you with an outline of our key priorities and the risks we have identified. I will also present a short analysis of some of the key funding fluctuations that you would see in this document.

I'll take you to page 3. A key piece of the RPP is the minister's message. The second portion of it provides an organizational overview, where you would find, notably, a list of the program activities of the department, that is, our key priorities, risks, and planning summaries.

The third portion, and one of the key aspects of the document, is a program-by-program analysis, providing key information on resource utilization, planning highlights that we have identified, and performance measurements for each of these programs. There is also some supplemental information that can be found throughout the document and by accessing other documents, financial statements and other information around ship building, for example, transfer payments and revenues.

On page 4, the minister's message, which, as I said, is a key piece to the document, highlights important changes to the Fisheries Act that will help the department focus our resources on the long-term sustainability and prosperity of Canada's fisheries. It also highlights some of our key work for the coming year—notably the focus on science and moving forward with our strategic investments in the Canadian Coast Guard. It introduces the four organizational priorities—which I'll cover in a second—and presents three strategic outcomes.

Next is page 5. The work we do and the priorities we've set are in direct support of these three strategic outcomes. The first one is economically prosperous maritime sectors and fisheries, and this includes the programs that support the sustainable and effective use of Canada's water resources. The second is sustainable aquatic ecosystems, which include the programs that contribute to the conservation, protection, and sustainability of Canada's aquatic ecosystems. The third is safe and secure waters, which include the programs that contribute to maintaining and improving maritime safety and security.

Page 6 lists our four key organizational priorities, in no particular order, the first one being the renewal of Canadian Coast Guard assets and service delivery. As you would understand, CCG's assets are a key success factor for the delivery of their programs. You may remember that in budget 2012 the department received $5.2 billion for fleet renewal. That was in addition to the $1.6 billion received for this in previous budgets. The second priority is advancing management and operational excellence. That means ensuring that our corporate functions are efficient and effective in supporting our program delivery. The third one is to ensure that we are able to align the legislative and regulatory frameworks to support long-term sustainability and prosperity. And the last, but obviously not the least, is improving fisheries management.

On page 7 we have identified key risks that we need to manage and mitigate well. There is physical infrastructure. There is no surprise that we are one of the largest, if not the second-largest, asset-based departments in the government, so this is key to our success. We deliver our programs with our people and our assets. Financial and human resources are an area of risk that we need to manage well in today's environment—human resources for sound employee engagement and to ensure that we have the right workforce, the right people in the right jobs, and financial resources to ensure that we manage our finances prudently. The last one we have identified is a risk related to hazard and crisis and ensuring that we have the capacity to deal with any crisis that may come up.

The next three pages are about the funding, and funding fluctuations. Page 8 provides you with an overview, a picture of the funding, broken down by strategic outcomes.

The first point I'd like to make is that the RPP compares the actual spending in previous years to the planned spending of the coming years. I have to say it's a little bit like comparing apples to oranges, because there are key differences between the two aspects. When we talk about actual spending, it's basically a reflection of our true spending in a year, which reflects the full funding authorities that were received. We all know that during any fiscal year we do receive some adjustments to our funding authorities through the supplementary estimates process. As an example, the forecast spending in 2012-13 is just over $1.9 billion, which is basically a reflection of our full authorities for 2012-13, the year that just ended. We started the year with just over $1.6 billion in the main estimates. There's been an additional $250 million or $260 million adjusted through supplementary estimates. The actual spending in 2012-13 should be just over $1.8 billion. Now we're closing the books as I speak, and we should be around that number.

The planned spending is basically a reflection in time of what we know about our authorities for the coming year. There will obviously be adjustments to these authorities. On the last page I will go through the adjusted planned spending from 2013-14, basically giving you an update, bringing the numbers considering the things we know now that we didn't know at the time of the production of the RPP.

I'll move you to page 9 and drill down a little bit into the key variances at a program activity level for some of the key programs.

In the first program, integrated fisheries management, you will notice a considerable swing between actual spending in 2011-12 and 2012-13 to the planned spending in 2015-16, basically just over $35 million. The key reason for this decrease is the long-term lobster sustainability program, which is in its phasing-out years and will terminate in 2013-14. As an example, in 2011-12, we spent over $21 million for that program. Basically, in 2013-14, in our last year, we're spending about $5 million.

Also, there's what we call the Larocque funding, which is funding that was sunsetting at the end of 2012-13. There's no renewal for that. Just over $10 million accounts for it.

In the second item, aboriginal strategies and governance, again, there's a considerable decrease in funding from the actual and forecast spending on the plan. The difference here can be explained by two key programs, the Pacific integrated commercial fisheries initiative and the Atlantic integrated commercial fisheries initiative, both of which sunsetted at the end of 2012-13 and for both we have renewal through budget 2013. Obviously, this renewed funding does not appear in this RPP and will be accessed through supplementary estimates, whereby we're going to get $22 million for the renewal of PICFI, which was a one-year renewal, and there's $11 million for the renewal of AICFI, bringing the total spending in 2013-14 in line with the projected spending in 2012-13.

In the third item, the sustainable aquaculture program, the reason for the decrease is that the new aquaculture program funding was sunsetting in 2012-13. We did receive renewed funding through budget 2013. The department received $57.5 million over five years, so $11.5 million a year. To the $20 million you see in the out years, we should be adding $11 million. The department will bring that in through supplementary estimates again.

In the small craft harbours program, here again there is a considerable decrease. Actually, the planned spending that you see for that program is the normal spending we usually have. We had received in budget 2011 $57 million as a result of the damages caused by the storm in December 2010 out east. We had received that money to repair all the damages to the harbours that had occurred because of the storm. We spent $43 million of that $57 million in 2011-12, and the remaining $14 million was spent in 2012-13. This is the main reason you see that funding decrease. It was a two-year temporary funding to help us go through that issue.

Turning to fisheries protection and the key reasons for the decrease here, the main reason is in relation to the efficiency savings that were identified through the deficit reduction action plan, budget 2012. We had over $15 million identified in relation to renewing the habitat program. Obviously, fisheries protection is what used to be called the habitat program. Also, a portion of it is due to the funding we received in support of the regulatory reviews and to modernize the regulatory system for major resource projects, what we refer to as MPMO. We had received funding in budget 2012, $21 million over three years. That money is actually sunsetting at the end of 2014-15, so that's why you see a $6 million plus drop there.

Looking at species at risk management, again, the decrease is in relation to money sunsetting. Part of the funding in that program was sunsetting at the end of 2011-12. Budget 2012 provided the department with $24 million over three years, so that program will sunset now at the end of 2014-15. That's why you see a decrease from 2014-15 to 2015-16.

In marine communications and traffic services, the key reasons for the decrease here are efficiencies that were identified through the deficit reduction action plan as announced in budget 2012. Close to $7 million of these savings through budget 2012 are a key reason for the decrease that you see here, along with other savings that were also identified in budget 2011.

Turning to fleet operational readiness, the fluctuations you see here, up and down, are largely all due to what I call cashflow fluctuation in relation to shipbuilding. We are in the works of acquiring, building, and modernizing quite a few ships. As I say, if we get $100 million for five years, we don't spend $20 million each year. Actually, the needs fluctuate. That's why we have a fluctuation.

I will also step out on a limb and say that in relation to the $5.2 billion that we got last year, as we start bringing the money inside the department, you will see the amounts in the out years actually grow considerably in the following documents and the following RPP. Basically, it relates to midshore patrol vessels that are in the works now, many vessel life extensions and mid-life modernizations, the $360 million that was announced in relation to the $5.2 billion that we got last year, the polar icebreaker air-cushion vehicle, for which we got $27 million in budget 2010, and the three science vessels and one oceanographic vessel, for which we got $388 million overall to acquire those.

I'll finish off with the last page to give you an update on the planned spending for 2013-14.

At the time of the production of the RPP, our known authorities were just shy of $1.7 billion, as indicated in the RPP. If we add the impact of budget 2013 decisions on to the year 2013-14, it will provide us with an increase of $57 million. Then we add our projected carry forward from 2012-13 to 2013-14. Every year we carry forward some funding from one year to the other, which we're entitled to. That's why I was saying that other authorities for 2012-13 are at $1.9 billion, and that's why I mentioned that we should be spending around $1.8 billion. Part of that money will be carried over to next year. Then we add funding that is pending approval from Treasury Board: $23 million in relation to shipbuilding, and another $7.7 million for the development of complementary measures related to the northern gateway project. So our projected authorities now for the coming year are closer to $1.9 billion.

Merci beaucoup.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. Huppé.

We'll move right into questions.

Mr. Woodworth.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

Thank you very much, Mr. Chair, and my thanks to the witnesses here today, particularly for that pretty masterful analysis of the numbers. I appreciated that. I'm not a numbers person myself, but I was able to follow you very well. Thank you.

I'm interested in the role that new developing technologies play in your department's delivery of services. To give you a sense of what I'm talking about, I'll give you examples of what I'm personally familiar with, and not necessarily relating to fisheries. I recently got a voice dictation program, so I'm now going to dictate my letters. They'll be produced at about 25% of the time that was required to deal with letters previously.

I have a company in my riding that will sort the data that's received from every ocean-going vessel on the face of this planet, not only location but capacity and what they're carrying. I'm sure there are technologies that influence the delivery of your services, in particular in the area of MCTS, marine communications and traffic services, and perhaps in other areas too.

I know the committee would want you to be taking advantage of technologies in order to deliver services effectively, and perhaps even at less cost. Can you give us one or two examples, if there is such a development in your department, please?

[David Balfour]

Perhaps I'll deal with some of the fisheries aspects of the question, and then I'll turn things over to Jody with respect to the coast guard.

The use of new technologies is a key element of our strategy for modernizing fisheries management and improving the effectiveness and efficiency of the services we deliver to fish harvesters. One example I would cite is the initiative we have brought into place to permit fish harvesters to renew their commercial fishing licences online. Whereas in the past fish harvesters had to come to DFO offices, line up, and go through a transaction to be able to receive their licences, which took them away from more critical work, like getting geared up to actually go out in the fishery, they can now renew their licences and receive their conditions of licence and other documents online 24/7. This is all part of improving the services.

We're also at a pilot stage of looking at what we call electronic log books, as opposed to fish harvesters using a manual record of recording where they're fishing, what they're catching, and so on. They'll be able to do that electronically and transmit that information to the department on a real-time basis, so it can be immediately actionable by the department.

We've introduced vessel monitoring systems in many fisheries, where we have transponders on vessels that signal the location of vessels, so we're able to confirm that vessels are fishing in areas that are open to fishing rather than areas that are closed to fishing. It allows us to be a lot more effective in terms of delivering conservation outcomes.

Maybe with that I can pass it over to Jody for some of the initiatives in the coast guard.

[Jody Thomas, Deputy Commissioner, Operations, Canadian Coast Guard, Department of Fisheries and Oceans]

Absolutely. Thank you, David.

As you're aware, the coast guard is undertaking a significant project to consolidate our marine communication and traffic services centres. That consolidation is predicated on a complete overhaul of the technology behind the operators, with entirely new consoles, entirely new screens, and entirely new views of the vessels and safety systems they're managing. It includes much of the technology that you've discussed, voice to text, so they'll no longer be doing the laborious process of recording marine and weather information; it will be text-converted. That will reduce their workload significantly. It will improve services for mariners, as it will be consistent. They'll hear one voice and it will be timely; it won't be delayed because the operator is busy with something else.

This project was under way for three years before we announced the consolidation of the marine communication and traffic services centres. We'll carry on for about two years after, as we continue to refine the technology being used.

The coast guard is constantly looking at new technologies and ways of improving communication with vessels, with mariners, and improving the entire safety network.

[Stephen Woodworth, Conservative, Kitchener Centre, ON]

I assume the increased level of technology has been incorporated into the budget plans we've just had reviewed. Is that correct?

[Jody Thomas]

Absolutely.