Thank you, Madam Chair, for having me here today to share the story from the Pacific coast.
My name is Duncan Cameron. I'm a fourth-generation fisherman from Pender Harbour, British Columbia. I grew up fishing with my dad for salmon, halibut, and herring spawn on kelp. At 18 I started running my own fishing boat while studying at marine school for my 60-tonne, and a few years later my 150-tonne, ticket.
Although I really enjoyed fishing it was hard for me to see a future in it and entry to fisheries beyond salmon were too rich for my blood, and the price at the dock was very poor compared to the price at the fish counter. I started working in other parts of the marine industry and found myself a good union job with a tugboat company at 20 years old. It paid well, had good benefits, lots of time off, and I got to be on the water.
Unfortunately, it wasn't fishing. I returned to fishing at 22 and am 30 now, and in any given year I may fish halibut, salmon, spot prawns, and Dungeness crab. In the last 10 years licences have only become more unaffordable. I own two boats and have to lease all the licences I fish with. I am lucky enough to come from a family that has fishing licences and it is really the only way I've made it this far in fishing. My father leases me his halibut at a more generous rate than the industry standard, and has let me use his boat as collateral while I have taken loans out over the last 10 years.
There is no real succession plan here that could take place for halibut ITQs to me. He could set up a lease-to-own framework where he would give me a very attractive lease rate, but this is a gift, not a succession plan. A lot of the stories you hear from the west coast are just that. Very few young people are left, and almost every one comes from a fishing family with licences. There is a saying on the Pacific that if you want to make a million dollars in fishing you should start with $2 million.
That does not have to be the future we choose, though, and that is why I am here today to thank you for working on a bill that supports independent fish harvesters, including economic and social and cultural factors.
Let me tell you a little more about Pender Harbour, where I grew up. Pender Harbour used to be primarily a fishing and logging community. Sustainable primary industries funnelled money through the community, creating all sorts of secondary economies. At one point there were seven boat-building companies operating out of Pender Harbour. Many of the hulls you see on the B.C. coast and in Alaska originated from Pender Harbour. Within this vibrant economy there was a great sense of community, tradition, and respect for the ocean.
Now if you cruise around the harbour, it's mostly mansions with blinded up windows. Please do not confuse us with a failed industry asking for a bailout. This is an industry with a failed policy and we are suffocating underneath. With the correction of this policy we can bring life back to coastal communities.
After hearing this, it probably sounds like another story you've heard too many times, so let's get down to the facts. Under this current policy the value is no longer in the catch, but in licences or quota. Catching fish is simply a marginal cost to licence-holders and quota holders. Even fishermen who invested in quota just to lease out can no longer see the point when they are competing with a seafood company that has revenue streams other than just leasing. If this is not stopped, it is only the beginning of consolidation. I don't think I need to tell you where a consolidation cycle will end up when we are already seeing corporations abroad settle for lower returns on investment in our industry. On that I am referring to the recent sale of ITQs for over $50 million in one sale abroad.
Now I would like to refer you to an example of a new entrant, or someone who already has halibut quota, trying to buy more halibut. The prices I am citing here are the current prices for this week, roughly. It can be hard to gauge the actual price of buying quota because this time of year it doesn't move very often, so I've put it between $100 and $115 and chosen the low end for my example. The lease price this year has come down because the dock price has come down and the difference between the two is basically the bare minimum. The dock price here is $7, the lease price is between $5 to $5.50.
In my scenario here, a fisherman or a new entrant takes a loan out to purchase 10,000 pounds of halibut quota. Let's assume that the person can make a 20% down payment and that he will get the low end of the price at $100 per pound. To give this scenario a fighting chance, let's also assume that the person also has a boat with a video monitoring system and all the required gear. Please note that only a few banks will actually make this loan on any fishing privileges or halibut quota and the collateral would likely be set at 60% of the actual market value due to conditions with licensing. There would need to be significant collateral put up in addition. Let's assume that, being at $100 per pound, the interest rate is 5% for ease of math, and the payback period is 10 years, which, in my opinion, is quite a long period in what is a very dangerous industry.
So this person heads out on a trip to catch their new 10,000 pounds, and it's a great success. They avoid incidental bycatch, and have no gear loss or unexpected costs. The landed value is $70,000. Now let's remove expenses: bait, $1,000; monitoring, $1,500; fuel, $1,500; and food, $300. Once again, these are just estimates. Here comes the big expense—$50,000 to the quota holder.
Because of the high cost of buying halibut quota, it is pretty standard that the owner will take the market lease off the top before dividing up crew and boat shares if that quota has recently been purchased. People who outright own their quota already may do the same, or may give the crew a bigger share off the top. So we'll set the boat share at a relatively small share of 25%, the skipper share at 35%, and the two deckhands at 20% each.
Now that the trip is over we have to make a boat payment. On this loan for $1 million, with $200,000 down, and $800,000 remaining at 5%, there is a $40,000 interest payment to be made the first year, and an $80,000 principal payment.
The only problem is that even with the $50,000 taken off the top, and if the skipper takes all his income and the boat's income and puts it towards this payment, it adds up to $59,420, which is half of the required payment for the first year.
These prices are based on estimates on April 24, 2018, and the sharing landed value left over after expenses can differ from boat to boat.
I've heard several times that this bill will be permissible, and that it will be up to the fishermen to put this legislation to work. But how can we do that if licence-holders decide how the fisheries will be managed? You'll be giving us a vehicle to get where we want to go by giving the keys to the people who already have control over us.
I would like to ask if you could please change the wording in the act to support active fishermen, not just licence-holders. Can you please define what is an inshore fleet for B.C.? And can you please give clear direction when this bill passes, and I hope it does, to the Pacific region that we are going in a new direction and away from the toxic policy that we already have?
I think I have a couple of minutes left and I know you've heard a lot about owner-operator policy, and I'll just quickly touch on another change to the act here because I know it's a very broad act.
I'd like to talk now about something you're putting forward that I do not agree with whatsoever and I think it will cause further disconnect between the DFO and coastal communities. The change to give more power to enforcement officers will not help our coast. I understand the idea of giving them a big stick if it's used cautiously, but that is not what happens here. They have been irresponsible with their power time and time again.
Where I fish in the central and north coast of B.C. they are often only in a field office for one or two years after transferring. When they first arrive they often do not understand the conditions of licences properly for the local fisheries, and intimidate people, not understanding any of the science. Most of our fisheries are already fiercely monitored. I am engaged in an Area B Dungeness crab fishery. We are monitored any time we are on deck, by video, RFID scanner, hydraulic sensor, GPS, and speed indicators. All the data is uploaded to a cellular modem and audited to our service provider, who we pay heavy fees to already. The people who audit the footage have a very clear understanding of both the management plan and conditions of licence. Infractions are reported to the operator of the boat and the manager. Giving more power to fisheries officers is only going to create tension on the water and we already have monitoring in place.
I truly beg you to consider properly funding the charter patrolman program instead. It has been gutted down to nothing. I cannot think of a more important job on our coast than charter patrolman. I would encourage you to research more about this program. People from other countries are even doing documentaries on them now as they see what an important role they play in our ecosystem, even though there are only a few left. I have grown up watching them being replaced by people with handguns and bulletproof vests who bully people around with conditions of licence they don't even understand.
Thank you so much for your time. I realize this was short, so if you have any questions on other topics or changes to the act, I would gladly answer them in question period. Thank you.