Fisheries Committee on Dec. 2nd, 2014

[The Chair, Conservative, Rodney Weston]

I'll call the meeting to order.

I'd like to thank the officials from the Department of Fisheries and Oceans for being with us here this morning. You probably are aware of the motion that was passed. We have a laundry list of items we'd like to chat with you about. I appreciate your taking the time to be here to brief our committee on the various issues at hand.

Deputy, I believe you have an opening statement to make and you're going to introduce some of the new faces at the table as well. I'll turn it over to your right now.

[Matthew King, Deputy Minister, Department of Fisheries and Oceans]

Good morning, and thank you.

Mr. Chair, I would like to start by thanking you and the members of the committee for inviting us to appear before you this morning. It is always a pleasure to answer questions about the important work that Fisheries and Oceans Canada, and the Canadian Coast Guard dofor our three oceans and in Canadian communities.

As you said, Mr. Chair, I will take a moment to introduce the team members from the Department of Fisheries and Oceans, and the Canadian Coast Guard who are with me today.

First of all, I'd like to introduce Ms. Leslie MacLean, DFO's new associate deputy minister. Leslie joined DFO last week and comes to us most recently from the Treasury Board Secretariat. Leslie has had a long and successful career in the public service and, Mr. Chair, after a week I can say we are very happy to have Leslie with us as well.

Long-time committee members will know that Leslie replaces Mr. David Bevan, who retired from the public service last May after 38 years of public service, all at DFO. That was, on a personal and a professional level, quite a loss for us.

Marc Grégoire, the Canadian Coast Guard commissioner, is with me today. Unfortunately, Mr. Grégoire will be retiring from the public service in a few weeks after 31 years of loyal service. The members of this committee know that Mr. Grégoire has been running the Canadian Coast Guard for over four years and that he was an important member of the DFO management team during that time.

I am pleased to inform you that Jody Thomas, who was already the deputy commissioner of the Canadian Coast Guard, will assume the responsibilities of commissioner on January 2, 2015.

The senior assistant deputy minister, ecosystems and fisheries management, Kevin Stringer, is with us as well. Some members will know that Kevin recently replaced David Balfour, who retired this past September after 35 years of service, 33 of them at DFO.

Our new assistant deputy minister, not unknown to the committee, from ecosystems and oceans science, Trevor Swerdfager, is here. Trevor replaces David Gillis, the former ADM science, who retired just last week after a long period at DFO. For those of you keeping track that is three Davids retiring.

Tom Rosser, the senior ADM, policy, is here as well. Tom joined us last year and has had a couple of opportunities to appear before the committee.

Finally, I would introduce Marty Muldoon, our CFO.

Michel Vermette is also here, deputy commissioner from the Canadian Coast Guard, to answer any questions on where we are on fleet renewal with the coast guard.

As you are aware, Mr. Chair, we were last here in March to outline the department's 2014-15 main estimates, which totalled $1.68 billion. DFO did not submit any items as part of supplementary estimates (A), so today we will talk about items under supplementary estimates (B).

Our supplementary estimates (B) include 25 items representing $178.2 million, including adjustments, net transfers, and statutory increases. To break that down, the majority of the increase is represented by an additional $123.3 million in capital spending. There are also increases of $33.1 million to the grants and contributions programs, and a $20.5-million increase to the DFO operating budget. In total, and if approved, these estimates will increase our departmental spending this year to $1.86 billion.

Key items of our supplementary estimates (B) that the CFO will cover in a minute or two include $32.2 million for the renewal of both the Pacific and the Atlantic integrated commercial fisheries initiatives, $17.8 million for repair and maintenance work under the DFO small craft harbours program, and $5 million to extend the recreational fisheries conservation partnerships program.

Mr. Chair, the government continues to invest as well in the renewal of the Canadian Coast Guard fleet and is proposing another $78.8 million to move us forward toward that objective. In addition to spending on fleet renewal there is $20.6 million in the supplementary estimates (B) related to the new light-lift helicopters for the coast guard.

I would like to thank you, Mr. Chairman and committee members, for your time and attention this morning. As we've agreed with the committee clerk, I believe, and if there are no questions on this part, I'll turn it over to our CFO, Marty Muldoon, who will provide a very short presentation on the supplementary (B)s.

[The Chair, Conservative, Rodney Weston]

Thank you, Deputy.

Please proceed, Mr. Muldoon.

[Marty Muldoon, Assistant Deputy Minister and Chief Financial Officer, Department of Fisheries and Oceans]

Thank you very much. I appreciate the introduction. I'll just add a few more contextual comments to help bring a bit of life to what these supplementary estimates mean for Fisheries and Oceans. Obviously, we won't cover this line by line, as it would take us the duration of the meeting. I'll be brief.

We are coming forward, as the deputy minister just mentioned, with supplementary estimates (B), and we will also then follow on with the supplementary (C)s. My summary estimate is that we will only be seeking about another $23 million or $24 million in those supplementary (C)s, bringing us to $1.88 billion in total authorities by the end of the fiscal year.

On slide 3 of the deck that we prepared for you, I'll jump right to the bottom line. Part of this is a cut-and-paste right out of the supplementary estimates, which members of the committee will easily recognize. I've added, for a bit of context, the increase since our main estimates.

We opened the year with $1.605 billion. I was here alongside the deputy and other members of DFO at the main estimates briefing in March, outlining that $1.605 billion. Since then, we've received the carry-forward for capital and for operating, which you can see shown in the centre column of “Authorities to Date”.

The starting point today, as the deputy just mentioned, is $1.68 billion. Moving to the column called “These Supplementary Estimates”, this is the composition by vote structure of the amounts that we'll be bringing in, totalling $178.2 million. Ultimately, as a result of these, we'll be moving forward, as noted, on $1.86 billion of plans.

We'll go to the next slide on page 4. The deputy just gave you a pretty good snapshot of the key items. Out of the 25 listed items in our supplementary estimates, the first 14 or so are actual voted items. This is a kind of hit list of the signature ones. Just to give a little more detail on how these are functioning for us, for the first three items on the page it says very clearly that they are budget 2014 items, so we're accessing these funds for the first time.

For AICFI and PICFI, as we call them for short—the Atlantic integrated commercial fisheries initiative and the Pacific version as well—PICFI will bring in $21 million out of that $32 million. The other $11 million will be available to the AICFI program, which, as the committee is probably well aware, helps our first nations fishery enterprises integrate into commercial fisheries and helps first nations participate in decisions around fisheries management.

For the next item, you'll recall that we had a good discussion on this during the main estimates, when the announcement for the small craft harbour increase was fresh off the press. As we know, it's a very successful program that augments spending on construction and maintenance, repair, and dredging, whatever the requirements are at local core fishing harbours across Canada. As a result of the announcement of the $40-million increase over two years that was set out in budget 2014, these supplementaries will bring in year one of that money, or $17.8 million. With that, we plan to embark on 28 projects across the country.

The next item is the recreational fisheries conservation partnerships program. Just to give some sense of how this one is working, it's a two-year announcement, which represents both an augmentation of and an extension to the existing formerly announced two-year programs. Just to demystify this, budget 2013 set out $10 million for Fisheries and Oceans over two years. We're in year two, 2014-15, so that was a five and five.

What this supplementary estimate will do is bring in the $5-million augmentation this year. It will boost the program in 2014-15 from $5 million up to $10 million and then extend the program into 2015-16 for a new additional year at a full $10 million. Then the program will have run for three years: at $5 million, at $10 million this year, and at $10 million next year. That program allows us to partner with local community organizations, not-for-profit groups, to restore fish habitats, and we expect over the life of the three years that we will have undertaken around 385 projects.

Moving into funding that was previously earmarked for Fisheries and Oceans and which we are now bringing into the organization, the coast guard increase of $78.8 million here is made up of three very discrete projects. The first big piece is $63.6 million for the offshore fisheries science vessel procurement, where we're having three science vessel trawlers built out on the west coast at the Vancouver Shipyards. Those vessels, as the committee is likely well aware, are for important scientific work that supports the sustainable development and conservation of our oceans.

The next item that makes up this $78.8 million is $9.5 million, which is part of a shared initiative between ourselves and DND to help that shipyard hit full stride in manufacturing capability or construction capability for our vessels. It's called horizontal engineering program plan. Basically, what we're doing is investing in the shipyard's capability to get itself up to capacity, to start churning out vessels.

Finally, $5.9 million, the remainder of the $78.8 million, is for refitting one of our icebreakers, one I'm sure the community is well aware of, the largest in the fleet, called the Louis S. St-Laurent. This is necessary for us to be able to keep that ship at sea for a little bit longer, up to the end of 2020-21, to align its life cycle with the planned delivery of the polar class icebreaker, the John G. Diefenbaker.

The next item is $20.6 million. This is the first major installment of a $183-million plan to put 15 new light helicopters into our service. We'll see the first one come into service this year. With this money, we will also build the building that will house the flight simulation training facility for both the light and the medium helicopters that will come on stream in time.

The last item noted on the page is outer limits, continental shelf, at $7.1 million. That was a capital project designed to enable us to add multibeam sonar capability to our icebreaker fleet in order to continue with our mapping exercises across the north. That's a good look at the signature items. I have a couple more points to make and then I'll be wrapping up.

We're on slide 5 now. The remainder of the supplementary estimates are about another 11 items. They are transfers to and from the department with other federal agencies, or internal adjustments among our votes. Quickly, on the slide, it points out that we'll see a net increase of $1 million in transfers to our department for six items. It's a couple with Environment Canada of around—

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

I'm sorry, Mr. Chair. I'm going to have to interrupt.

When you say slide 5, 4, 3, I'm having trouble following.

[Marty Muldoon]

Sorry.

Do you have a slide that says current status? It looks a little bit like that.

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

All right.

Thank you.

[Marty Muldoon]

Excellent.

We have three transfers coming in. Two of those are from Environment Canada. We have one for the environmental restoration of the Great Lakes. We have a second one to support aboriginal involvement in activities related to programming for species at risk. We have a third one from DND for the efforts that we undertake on their behalf for search and rescue programming. We are transferring funding to support fisheries management in the Labrador Inuit settlement area out to the Department of Aboriginal and Northern Affairs. There is also another transfer to the same department for the co-management of the Tarium marine protected area.

Finally, as I mentioned, we have five internal transfers that allow us to get money out of our operating vote and into our grants and contributions vote, so that we can support the various programs that we undertake. Primarily that would be aboriginal supports programs. That's a good look at the 25 items at a really high level.

I will land on slide 6 to close. As the deputy said in his opening remarks, these supps would move us from $1.68 billion to $1.86 billion in terms of total authorities. Prior to these supps, we had very strategically managed $147 million in available authorities, through either reprofiles or the two carry-forwards that I mentioned on one of the slides earlier on, staying well within our limits in those instruments so as to align timing. As a great example, it's simply a matter of getting the capital funding aligned to the actual production schedules at Vancouver Shipyards. A lot of this is keeping that knitting tied together.

Altogether, as we move to the supplementary estimates that will come later in the year, we believe that DFO will have the authorities necessary to fulfill its mandate and expectations in 2014-15.

Thank you very much, Mr. Chair.

I'm happy to take any questions.

[The Chair, Conservative, Rodney Weston]

Thank you very much, Mr. Muldoon.

We're going to go right into questioning. We'll start with a 10-minute round, and we'll start with Mr. Chisholm.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

Thank you very much, Mr. Chairman.

Thank you to the senior staff at DFO and the coast guard for being here with us today.

Let me begin by saying, Mr. Chairman, how disappointed I am that we are not going to see the minister before the supplementary estimates (B) are introduced in the House to vote. This is a significant department with a nearly $2-billion budget, and the supplementary estimates (B) are $178 million, no small sum.

People are probably going to say, “Well, you know, it was because of procedural wrangling that this committee hasn't met, and therefore, we weren't able to give the minister enough time.” I think we all knew that the supp (B)s had to go back into the House at a particular point in time, and therefore, she could have.... A few other ministers have appeared before their committees to answer questions. I wanted to make that point, because it's all about accountability, and I think the political minister is responsible to the House through this committee.

I have a few questions. Most of them deal indirectly with the supp (B)s, but I want to start with the decision to bump the work on the new polar vessel out to 2022. I believe Seaspan said that we can't do everything and the navy got precedence on the space that they had in order to do this work. I think the Louis was built in 1968 and does pretty hard work. I wonder if you share the concern expressed by many that this is going to affect our ability to do the kind of work that the Louis has done, if we are going out to 2022, and heaven knows whether we're going to be able to do the work even before then. I wondered if you would comment, please.

[Marc Grégoire, Commissioner, Canadian Coast Guard, Department of Fisheries and Oceans]

Yes, certainly.

First of all, this is a collective decision. We have a deputy ministers' steering committee, and we advise ministers on the way forward on this one.

The shipyard, as you mentioned, can only build so many ships at the same time, and they have to be lined up, so we had to make a decision between the joint supply ship of the navy and the Louis S. St-Laurent.

You mentioned the age of the Louis. The joint supply ship is older and in far worse shape than the Louis. We, the coast guard, offered, if we got the money, to extend the life of the Louis. We would be able to extend it probably past 2022, even 2024. That's why we are getting money, to extend its life, and we actually did some work. It's in very good shape. It was at the North Pole. It's a solid ship; it's the flagship of the coast guard. We don't have any problem extending that, and this will not affect the work of the coast guard.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

I appreciate the fact that there are choices, and we've come up against it on a number of these procurement issues, where a lot of things have been left to languish because the procurement process has not been as speedy as we would like it. Everything is coming into the funnel at the same time. Nonetheless, questions of safety, research, Arctic sovereignty, marine traffic, and so on, are all important. You know better than I, but the fact that it was deemed necessary to get this work under way and now we've punted the ball farther up the line causes some concern, as others have expressed.

Let me move on, if I may. Regulatory changes were made this past spring as a result of legislative changes in 2012 to the Fisheries Act, as it relates to the release of deleterious substances in the aquaculture sector. I wondered if you could give me an update on the status of these new regulations. Has the department listened to the concerns—I've certainly heard them from many Canadians—and have any changes been made as a result of the concerns that have been raised?

[Matthew King]

Thank you for the question.

The changes to the fisheries protection and pollution prevention provisions in the Fisheries Act and the subsequent section 36 designation order, which was made public last spring, we believe will focus and clarify federal efforts in managing threats to fish and fish habitat. Implementation of the designation order will be governed under an interdepartmental MOU with the Department of the Environment.

I think on balance, the MOU will ensure clear roles and responsibilities for each party and support even greater collaboration among departments. This work had been under way for quite a while. You might remember that the delegation of section 36 to the Minister of the Environment took place in the mid-seventies by way of a letter from the prime minister of the day to the two ministers.

The designation order is simply to provide certainty and clarity to industry that from this point forward, the Minister of the Environment is now fully responsible for the administration of section 36, the deposits of deleterious substances, with the exception of the way section 36 is applied with regard to aquaculture and aquatic invasive species and aquatic pests.

So whereas before, the Minister of the Environment undertook section 36, it was always the Minister of Fisheries and Oceans who remained accountable to the House. This designation order formalizes an arrangement that's been in place since the mid-seventies.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

Last September, the minister signed a memorandum of understanding with B.C. first nations. For some time there's been a concern and my understanding from talking with first nations leaders in B.C. is that whenever a court decision comes down or whenever there's a decision needed in managing a particular fishery, the Department of Fisheries and Oceans has expressed that they don't have a mandate.

But that changed, I understand, with this memorandum of understanding signed by the minister and I believe with the BC Treaty Commission and with the leadership of the B.C. first nations, and that includes two meetings a year. I know some concern was expressed in December when I was out there that a meeting had been scheduled with the minister but had been cancelled at the last minute.

I wondered if you could give us an update on that, whether that MOU was being fulfilled, and a status report on the negotiations with the first nations.

[Matthew King]

I'd be happy to.

Thank you for the question.

Minister Shea did sign this MOU last year. It had been under negotiation with the First Nations Leadership Council for a period of time. It does commit the minister and the department to a minimum of two meetings a year. I believe Minister Shea has had at least one, and I think maybe two meetings with the leadership council so far. I'm afraid I'm not aware of a meeting that was cancelled in January. Beyond the formal meetings with the minister, which as you pointed out happen every two years, DFO officials, myself included, meet with the leadership council. I meet with the leadership council every time I'm in British Columbia.

It's quite a good forum. It's one of those where, it's fair to say, there's a fair and frank exchange of views but on balance. It's a way for us to continuously interact with key first nations and their representatives on fisheries issues across the coast. So I think the MOU is quite a good initiative.

[Robert Chisholm, NDP, Dartmouth—Cole Harbour, NS]

I was interested if you could provide us with an update on the 2014 B.C. salmon run, particularly sockeye, chum, and pink. At one point, you were here before this committee and indicated that 12 or so recommendations of the Cohen Commission had been addressed. I wonder if you could give us a brief update on the 2014 run and also indicate whether any additional recommendations from the commission have been implemented.

[Kevin Stringer, Senior Assistant Deputy Minister, Ecosystems and Fisheries Management, Department of Fisheries and Oceans]

In terms of salmon this year, it was a very good year for Pacific salmon and Fraser sockeye, in particular. In fact, final formal numbers won't be in until March, but the estimate is around 20 million returned this year. We made some adjustments to management measures and we believe around 10 million were caught.

We've met our escapement measures and it really has been an extraordinary year. In fact, we've been keeping good records in terms of the number of returns since the fifties. This will be probably number four in terms of the run, certainly top five. So it was a very good year. In other runs, we saw good numbers for chinook in some areas where we hadn't seen chinook. We saw remarkable numbers in the Okanagan that we hadn't seen for years, still low numbers but some increases. So there was some good news in that regard.

With regard to Cohen, we've said previously, with respect to the department's approach, that we do take the recommendations very seriously. We've moved forward on much of it. We spend $65 million a year on salmon on the west coast, $20 million of which is on Fraser River salmon specifically, and around $16 million to $19 million, depending on the year, on science.

We have moved forward on specific issues, such as maintaining the current moratorium on new developments for aquaculture facilities in the Discovery Islands area. We've made specific investments. The recreational fisheries partnership program, which is featured in the supplementary estimates, is one piece.

We've provided an extra million dollars a year to the Pacific Salmon Foundation to do much of the work around habitat, but also the general issues that Justice Cohen speaks to, and we continue to be guided by the advice.

It has been a really good year for salmon on the west coast. It goes in cycles and in terms of the four-year cycle, this was expected to be a good year. You may recall that 2010, four years ago, was also a very good year. In 2015, we don't expect as positive a cycle, but we're hopeful that some of the signs that we saw in a number of other species, and the management measures that we've taken, will mean that we have a good year next year as well.

[The Chair, Conservative, Rodney Weston]

Mr. Kamp.

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

Thank you, Mr. Chair, and thank you, gentlemen, for coming. Ms. MacLean, welcome to the committee, and welcome to DFO. It will be good to have you there.

I'm sorry to hear that Commissioner Grégoire is going to be leaving, so let me ask a couple of questions in that direction to begin with.

In the presentation, there was mention of the shipbuilding initiatives. I'm particularly interested in the offshore fisheries science vessels.

Could you just remind us again how much of the $78.8 million for shipbuilding, that's listed in the estimates, will be used for these offshore fisheries science vessels? Are these vessels replacing aging science vessels or is this increasing the capacity of the department to do this offshore science work?

[Marc Grégoire]

Actually, these are to replace very old vessels, three old fishing trawlers, one in St. John's, one in Dartmouth, and one in Victoria. Of the $79 million, $63.6 million is devoted to these three ships, which will be built by Vancouver Shipyards.

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

You say they're trawlers, but in a general year, what are the tasks that they're engaged in?

[Marc Grégoire]

That would be a question for our colleagues in science.

[Trevor Swerdfager, Assistant Deputy Minister, Ecosystems and Oceans Science, Department of Fisheries and Oceans]

There are a number of functions to which these vessels are put.

The first and the critical, and most important part is the fisheries survey, so that we can determine, to the best of our ability, what fish are in the sea, where, what numbers, what trends, and so on. We have a very extensive time series of data on both oceans and to a growing degree in the Arctic context. These vessels are very much oriented around that.

Secondly, they have a number of ancillary functions in the oceanographic science area. They do a fair number of measurements at sea for pH, salinity, temperature, current, those sorts of activities. To the extent that we can do so, we also will occasionally load them with other experimentation modules to do a variety of much more purpose-built and usually shorter-term research projects.

In addition, there are a number of additional coast guard-type duties, which are not specifically related to science but do a number of other functions in SAR and other areas in the coast guard duty portfolio.

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

Okay. Thank you for that.

Can you tell us when these ships are going to be in service or are expected to be in service?

[Marc Grégoire]

I'll let Mr. Vermette answer this one.