HANSARD

Printed and Published by Nova Scotia Hansard Reporting Services

Mr. John MacDonell (Chairman)

Mr. William Dooks

Mr. William Langille

Mr. Gary Hines

Mr. Charles Parker

Ms. Joan Massey

Mr. Wayne Gaudet

Mr. Keith Colwell

Mr. Gerald Sampson

[Ms. Joan Massey was replaced by Mr. Charles Parker.]

[Mr. Wayne Gaudet was replaced by Mr. Harold Theriault.]

In Attendance:

Ms. Mora Stevens

Legislative Committee Clerk

Mr. Clary Reardon

Department of Agriculture and Fisheries

Regional Director

Fisheries and Aquaculture Management

Mr. Andrew McMaster

Senior Advisor for Pelagics

HALIFAX, TUESDAY, MAY 17, 2005

STANDING COMMITTEE ON RESOURCES

9:00 A.M.

CHAIRMAN

Mr. John MacDonell

MR. CHAIRMAN: We will get started, and usually the first order of business for us is for all members of the committee to introduce themselves, and once they do that, Mr. Burke, you're free to make your presentation and there will be questions afterward.

[The committee members introduced themselves.]

MR. CHAIRMAN: Go ahead, Mr. Burke.

MR. LES BURKE: Thank you very much for inviting us to your committee. I just prepared a little bit of an overview of the DFO Maritimes Region to give us a bit of a context from which you can ask questions. Rather than set it up, I think I'll just use the material that has been circulated, if that's okay with you. Basically there are three main themes or business activities in the Department of Fisheries and Oceans at the moment and really all of our organizations are directed towards certain outcomes or good objectives in these three broad areas.

The first is healthy and productive aquatic ecosystems, and our concern is for the habitat and the whole ecosystem or food chain associated that supports the productivity of the oceans and the marine environment; our second theme is sustainable fisheries and aquaculture, and this really is the basis for our commercial fisheries, our recreational fisheries, all of the use that we make of resources in a sustainable way - in addition we have responsibility for an element of the aquaculture industry in Canada that is a shared jurisdiction with provinces and we do have co-operative agreements and memorandum of understanding that lay out various roles in either the regulatory area or the scientific support area for the aquaculture industry.

The third broad area is safety and accessible waterways, and this includes, for example, the work of Coast Guard in search and rescue, in aids to navigation, the work of our Canadian Hydrographic Services which are located in our science group in the provision of navigational charts and even, in fact, the work of our Small Craft Harbours folks who provide infrastructure for safe mooring of small vessels, including our fishing vessels.

We are focused on two key goals in our current three- to five-year plan, effectively managing ocean resources and streamlining our environmental processes. This is sort of a broader context that's coming out of the way in which we were looking at resources. I would say historically, the state of the art in terms of understanding resources was to focus on a single species and optimize the management of that species and its productivity.

Through the 1980s and the 1990s, we still had that broadening out to concern, not just for a target species but for related species, things that you might catch as bycatch, as they call it, when you're fishing for a particular resource. Then, increasingly, we've been concerned with the impact of fishing on habitat or the impact of environmental change on fishing. This has been sort of a global switch in the emphasis that governments that have management responsibilities for ocean resources have been making over time.

It seems, intuitively, something that you should go to right away, but, in fact, it's a very complex system and we only understand some of these dynamics to a relatively small degree. We're kind of learning about environmental management in that context and applying it increasingly to our sense of how much man can remove from nature and still have a sustainable system.

The area that I work with is called the Maritimes Region, but as you can see from the map at the bottom of Page 2 we really deal with, primarily for fisheries purposes, the area in green on that map, which is called the Scotia Fundy portion of the Maritimes Region, and it incorporates all that water area that you see lettered 4VN around to 5Y and 5Z, down to about the American border. So the fish stocks in that area are under the management of the Dartmouth office here. As you can see, it includes most of Nova Scotia and about a third or so of the New Brunswick area, so the waters of the Bay of Fundy are managed by us as well.

There's another office in Moncton that is responsible for fisheries management activities in the southern Gulf area, that's the light blue area, and they have responsibility for the Gulf shoreline of Nova Scotia as well, as you can see there, and up to the tip of Cape Breton. All together, there's quite a bit of coastline here, as you can see, 8,600 kilometres of coastline. We have a staff of over 2,000 employees, that includes our Coastguard and DFO staff. Coastguard is now a special operating agency that works within - reports to the minister, through the deputy minister, but is increasingly a separate entity from the department. They provide us with our platforms at sea for science work and for conservation and enforcement policing activities, but they are increasingly treated as a separate agency from the point of view of administration.

So there are three Coast Guard bases, and 8 SAR stations, helicopter sites, three hatcheries. From a Fisheries point of view, there are area offices in Sydney, Yarmouth and St. Andrew's, New Brunswick, and there are 13 sub-district offices and 12 satellite offices. We have major scientific installations here at the Bedford Institute of Oceanography. If you haven't already had the chance to visit there, I suggest you do that, that's a very interesting place. There's another large research station in St. Andrew's, New Brunswick.

Our organizational structure is on the top of the next page. Aside from the corporate and policy communications and HR-kind of activities, our business line focus are oceans and habitat which are primarily responsible for the environmental habitat program areas. The Canadian Coast Guard, as I mentioned, has a separate operating agency. It's sort of largely out there on the safety agenda that I mentioned earlier. Fisheries and Aquaculture Management, the section that I am responsible for, for the development and management plans and the enforcement and other administration of those plans. Science is managed under an umbrella organization as well, and they provide support to the Oceans area, to the Aquaculture and Fish area and to Coast Guard, in terms of some of the hydrographic services support I mentioned.

To give you a sense of how important this region is in a Canadian context, the map down below with the numbers on it shows the division of $2.2 billion in total landings that were reported in Canada. This was in 2003. As you can see, the West Coast, all of British Columbia, had about $360 million worth of landings. This is landed value at dockside from wild fish harvested. The Quebec region had about $170 million. Newfoundland and Labrador reported $550 million roughly. The Southern Gulf area, $361 million, and almost $800 million for this area, it's by far the largest landed value area in the country.

[9:15 a.m.]

People are often surprised to learn that the waters that you saw in the map on Page 2, that water zone that's off of our coast and down to the American border, is about the same size as the water zone on the West Coast that British Columbia has in the Pacific. Because of the panhandle and how far that comes down the coast, you're actually halfway down British Columbia before you get to a coastline that actually Canada has jurisdiction over out to sea 200 miles. So when you actually do the water area under management, Nova Scotia, the Scotia Fundy part of Nova Scotia and British Columbia are both the same size, and it's about twice as productive here as it is there from a landed value point of view.

The top of the next page is a breakdown, if you want, of the fishery resources that contribute to the commercial fisheries in this region, the same numbers that I showed you on the last page, for two periods of time, 1990 and 2003, and what you see here is a bit of the quite dramatic change that has happened over that 13-year period. There was a very high-profile collapse of groundfish activities in Atlantic Canada in the early 1990s, that extended all the way from the north, Newfoundland and Labrador, all the way down to this region as

well, and as you can see, groundfish which used to make up about almost 40 per cent of landed value here in this region, has now been reduced in terms of its contribution to the total landed value to being about 11 per cent of the total landings.

The pelagic part of the picture which is - I should say, groundfish are typically cod, haddock, pollock, they include redfish, flounder and a number of other species that tend to live near the bottom of the ocean, and they're fished typically with a number of different technologies in that area of the ocean floor. The pelagic species are typically herring, mackerel, the small-size pelagic, and the larger ones are things like tuna, swordfish, and they're fish that tend to live in the water column further up. Pelagic haven't really changed much in terms of their contribution to the fishery in total.

Finally, the shellfish side of the equation has expanded quite dramatically, as you can see there, going from about 50-odd per cent to 80-odd per cent, over this period, and the big growth there in values comes from things like lobster, scallop, crab and shrimp. And as you can see overall, the value of the fishery over this period, even though the groundfish collapse was seen as sort of a very high-profile and quite disruptive event, has almost doubled in this period.

The lower graph is the picture for aquaculture over about a 10-year period actually, from 1991 to 2001, this is in the Maritimes Region overall. I should say that most of the landings you see there on the top graph are actually Nova Scotia landings, because there isn't a large commercial operation landing on the New Brunswick side of the region. The graph down below is aquaculture. Again, very dramatic growth over this 10-year period, two and a half times really what it was. Mostly salmon accounts for this growth, and a lot of this development has actually happened on the New Brunswick side of the region. So the top picture is mostly commercial fishing, Nova Scotia's picture, and the bottom is about $40 million worth of aquaculture activity here in the province relative to this big number, almost $200 million of that would be southern New Brunswick.

Some of the key challenges that we face at the moment in the region that are part of our activities for the coming year and the coming few years, we're always, it seems, in the middle of reinventing ourselves from an organizational point of view and trying to modify our organizations to deal with emerging issues and perspectives on how the ocean is challenging us and how the environment is challenging us. So we have an ongoing project called Fisheries Renewal, which basically is following a period of policy review that will lead us to, we hope, a change in our Fisheries Act. Our Fisheries Act is about 100 years old and it's very difficult to manage a modern set of activities with a piece of legislation that dates back quite that far.

In addition, the Parliament of Canada has put in place a number of other important pieces of legislation that impact on the department and that influence what we do. They include the Oceans Act and the Oceans Act is a broader bit of legislation that aims to take

into account the cumulative impacts of all the things that impact on the ocean. So to the degree that minerals or oil and gas exploration, shipping, cable laying, any of the activities there, they're still the primary responsibility of perhaps other legislation or even other jurisdictions, but together they contribute to an impact on the oceans. So the Act aims to encourage sort of a more co-operative and coordinated view of these activities so that we do have a sense that our single-purpose activities in the ocean, man's single-purpose activities in the ocean, are taken into account.

So Fisheries Renewal aims to respond to these kinds of changes that we've seen. The Oceans Act is relatively new. We also have new legislation to protect species at risk in Canada and that has to be dealt with as well.

The second item you see there is increasing Aboriginal access to fisheries and we have, as you would know, responded to changes or to decisions, in some cases court decisions, interpretations of old treaties where the courts have determined that we have not adequately given consideration to rights that Aboriginal people have through those treaties and so we have had an active program of enhancing Aboriginal presence and Aboriginal activities in fisheries, both in the commercial fisheries and in their food and social ceremonial fisheries, and not just here but across the country.

There have been closures that I mentioned in groundfish and there are rebuilding activities going on in some of those species. I mentioned just the importance now of our shellfish fisheries and clearly there are efforts in trying to ensure that those are sustainable over the long run. It's getting to be a smaller and smaller world. There is more and more traffic and more and more activity going on and one of the downsides is we often see that we have invasive species that we bring in with ballast water say, or just ship traffic, we can find the movement of either a species or disease that isn't native to this area that takes hold and can cause some disruption. We've had a couple of high-profile cases of that activity.

Finally, there is a lot of change going on in the aquaculture industry, a combination of market pressures and an industry that's at a certain point in its growth and development that needs a different kind of regulatory infrastructure to support it. So there is an aquaculture project that's going on that significantly affects New Brunswick, but also spills over into the rest of Atlantic Canada. So these are some of the key challenges that we're currently facing and maybe I'll just leave my opening at that.

MR. CHAIRMAN: Thank you very much and I have a couple of members on the list for questions. So, Mr. Langille, you're number one.

MR. WILLIAM LANGILLE: Thank you for your presentation. I believe that this morning we probably won't get through all the questions. This is an important industry to Nova Scotia and it's one that a lot of us don't understand and I'm happy that Mr. Theriault

from Digby is here today, having been a lobster fisherman in his former career, and he has a lot better understanding of fisheries than I do, although I do raise fish.

I do believe that aquaculture will be making a significant impact in Nova Scotia and I know there will be some resistance to it. I look forward to seeing the raising of halibut because I think there's a great market for that, but my questions are in the enforcement area and being a former police officer, I'm always interested in enforcement. The illegal Summer fishing, particularly in southwest Nova Scotia, what is your enforcement plan for this year on illegal fishing in that area?

MR. BURKE: There has always, of course, been some level of illegal activity in the lobster fishery. It happens through the open season to some degree and it certainly can happen at a time when the season is closed. That's typically sort of the high-profile area and unlike many areas in Atlantic Canada, we do have a fishery that closes for the most part, especially in the southwestern part of the province, in the Summertime, which makes it that much more attractive to go out and do illegal stuff when the weather is good. So we do end up with a particularly significant challenge in dealing with poaching in the Summertime.

We had a number of incidents last year that were fairly high-profile in the Summer fishery that were a combination of sort of a traditional poaching activity, if you want, and the way we had set up the Aboriginal food fishery and we had some people who were unscrupulously combining these two issues and it made our normal enforcement practice less effective. Let me elaborate on that a little bit. Essentially the way that it would work in former times was that if you were fishing illegally and you were detected at dockside with lobster in your possession, you could be charged automatically and you could be brought through the process and our chances of conviction were very high.

The social ceremonial food fishery allowed individuals to have in their possession lobster that they would catch legally in a food fishery. We did have some activity going on - and really there weren't that many people involved - that it was under cover of that activity that they were getting away with.

MR. LANGILLE: They could probably eat for about 10 years on what they had.

MR. BURKE: Yes, you know, these were actually small-scale commercial activities under the guise of, and so the challenge we had last year was to actually establish - the way the regulations were set up, that these lobster were caught in traps that were not tagged because our rules were that you had to catch your lobster in a tagged trap, but people were setting a lot of traps that weren't tagged because they only had so many tags and they were bringing it all to shore and claiming that this very large amount of lobster had been caught in properly tagged gear.

[9:30 a.m.]

We had taken cases like that to court and the judge was basically unwilling to convict on a reasonableness kind of grounds. Through the courts last Summer it turned out to be a very frustrating Summer for people who were watching from the sidelines. We actually had to get to the point where we located traps that were untagged, planted lobsters that we knew were illegal and that we could prove to the courts were illegal in those untagged traps. Then we had to catch them when they came to shore to be able to have a successful conviction. As you can imagine it takes a bit more time to do that than it does to have somebody come to shore with a lobster in their possession and say you have a prima facie case here, we've got you.

MR. LANGILLE: Of entrapment.

MR. BURKE: Well, the entrapment stuff was okay, we can do that part but we lost this other ability to just say if you have a lobster in your possession, you're guilty.

That was what happened last Summer but we eventually did catch some of the major operators that were involved with this, using a much more elaborate enforcement process that was a lot more expensive to conduct as well. It was very frustrating for the people looking on because we couldn't tell them what we were doing and they were just looking at it and saying, you're not doing anything. Of course if you could see us doing anything, we weren't going to be successful. That's what happened, we ended up with a number of convictions towards the end of the Summer for the people who are doing these things. We're very confident of success although they haven't made their way fully through court yet.

This year we will have a different set of rules for the food fishery that will allow us to charge people if they have more than a certain amount of lobster, which will be of a reasonable amount. We're expecting that our actions can be much more direct and it'll look a lot more like the fishery that we used to have from an enforcement perspective. In fact, I'm going from this meeting to a meeting tonight in Yarmouth with the industry. We are coordinating very closely our enforcement activities. Last year we had a lot of very contentious civil disobedience that was sort of just bubbling near the surface, we had people who were going to take matters into their own hands, we had guns, we had shots fired, it was getting to be a very risky situation for everyone. The RCMP were quite concerned about personal safety and conflict and are partnered with us very closely as is the provincial Department of Agriculture and Fisheries on our enforcement plans for this year. You'll see some communication products out on how this is going to be evolving over the next few days. We're optimistic that we will be in a much better position this year than we were last.

MR. LANGILLE: I'll pass because it took a little longer than what I anticipated.

MR. CHAIRMAN: Hopefully we will get back to you, Mr. Langille.

Mr. Sampson.

MR. GERALD SAMPSON: The MSX in the Bras d'Or Lakes, you've mentioned ballast water, proving it is one thing but that seems to be where it has come from. What steps are being taken in a combination between ballast water and the MSX because we were successful in having the Bras d'Or Lakes designated as a non-discharge zone for sewage?

MR. BURKE: Typically the rules are that you are to discharge your ballast water some place else. On your way into ports you should be doing this further out to sea. We can't say definitively that it was a ballast water issue that led to MSX. We also have a lot of boat traffic that just comes up without a ballast water situation and this disease could have clung to the bottom of many boats. We have a lot of pleasure craft into the Bras d'Or Lakes that come up the coast over the course of the Summer. The rules with respect to ballast water discharge are there and they're not part of our mandate, they're Department of Transport rules and they do prescribe that ballast water should not be discharged in coastal areas. It's a matter of detecting it if it's happening and being more vigilant and diligent than we've perhaps been in the past. The other part of it is increased traffic so it isn't just a matter of having people dump water.

MR. GERALD SAMPSON: Seismic testing has been done in Sydney Bight and there's a lot of registered areas there of munitions, as the military call it, unexploded ordnance, from the dump during the war and after cleaning up naval bases. Are there any rules or regulations around that in regard to the fisheries?

MR. BURKE: Generally speaking what happens there is our charts are marked with areas where one shouldn't fish. There are things that have been placed on the sea bottom, as you point out, as a result of previous decisions made. We mark these areas when we do discover where they are, or they've been marked for a long time, and fishermen are advised that these are hazard areas, they shouldn't actually be fishing in those areas if the kind of fishing they're doing is going to risk bringing up the ordnance or other dangerous material.

MR. GERALD SAMPSON: Mr. Chairman, I'll just ask one more. Local processing. It appears that most of our raw product is shipped out, whereas Newfoundland and Labrador insists on processing everything in Newfoundland and Labrador. Our lobsters, our crab, everything seems to be going out in trucks, heading to New Brunswick, so are there any rules or regulations that we can't process in Nova Scotia, or is it just that somebody owns the product and are taking it elsewhere to process it?

MR. BURKE: Any rules of that sort that might exist are, first of all, provincial as opposed to federal. The federal government does not have rules against interprovincial movement of any product. In fact, if anything, the federal government promotes interprovincial movement of product so that Canada, as a whole, would benefit by having product moved and be processed in areas where it makes the most sense to do so. To the

degree that there are any constraints, they are provincial, not federal, and you would probably best address that to your provincial colleagues in the Department of Agriculture and Fisheries.

MR. CHAIRMAN: Mr. Parker.

MR. CHARLES PARKER: Mr. Chairman, thank you, and good morning, gentlemen. I wanted to ask about just the overall nature of the industry, I guess, it's changing. I come from Pictou County and a lot of lobster fishing and scallops and other species, but overall the fishery - for hundreds of years it was concentrated in the communities, in our fishing families and today there's certainly a trend toward more corporate control of the fishery. I want to ask you in particular about the DFO policies around the owner/operator policy and the fleet separation policy. Those are issues that are there designed to protect the small independent fishermen and make sure that the beneficial use of the fishery remains with the fishing family, with the fishermen, but it seems that now with ever-increasing values of licences, a lot of that is being lost to the independents there. They need capital and when they can't get it, trust agreements are being set up between fishing families and the processors and other outside interests. The fishing industry is changing and it's disappearing from the control and the use in the community and it's going to corporate interests in many cases. My first question then is around the owner/operator and fleet separation policy. It appears that it has not been enforced to the benefit of the independent fishermen. Can you tell us about that?

MR. BURKE: Well, we've had owner/operator and fleet separation policies in place since the early 1980s. The owner/operator policy requires that - they only applied first of all in Atlantic Canada, and they applied to fishing operations conducted from vessels under 65 feet. The owner/operator policy says, strictly speaking, that a registered fisherman has to be the holder or owner of the licence and that the fisherman should be onboard while the fishing is taking place. That's sort of the full-blown owner/operator piece.

The fleet separation policy was introduced around the same time. It basically said that processors couldn't acquire fishing vessels and licences for these fisheries under 65 feet. As the policies have been applied over time, in the case of the fleet separation policy for example, there was nothing that prevented a fisherman from becoming a processor, so we ended up actually with a lot of fishermen starting little plants, we ended up with families who were fishermen in the area you're trying to promote actually became little processors and sold their product into the market. There was a certain amount of vertical integration that was in some way perversely allowed under this fleet separation policy in the way it was designed and applied over time.

In the case of the owner/operator policy, we still require whenever we issue a licence to anyone or whenever a licence is transferred from one party to another party in the fishery, the party who receives the licence - and we do facilitate these transfers as a way of allowing

business flexibility - is always a registered fisherman. In some fisheries, lobster, we still strictly apply the fact that the owner/operator is supposed to be onboard the boat and we still apply that policy. In the case of other fisheries, over time we've seen in groundfish and a lot of the pelagic fisheries, fishermen have in this region come forward and said we'd like to be able to designate an operator for our owner/operator fisheries. We have agreed to those designations so they are able to sometimes appoint someone to fish their groundfish licence while they're doing something else - maybe it's managing the enterprise as a whole or fishing their lobster licence.

But the designated operator element is something that has happened in this region for at least 10 or 12 years. The owner/operator thing is still in place in terms of the licence holder being a registered fisherman, but these designations are used quite broadly. I would say there are probably 2,500 designated operator privileges out that there that fishermen use to have someone else run maybe a groundfish licence while they're fishing their lobster at a certain time of the year.

MR. PARKER: So in many ways then the owner/operator policy, while that's the policy of your department, you're slipping away from that in allowing designated operators to do the fishery directly rather than the owner being on the water. Many of the fisheries out there, as you know, are getting pretty concentrated now, in the hands of fewer and fewer, like the Digby scallop fishery and I hear the same thing's happening in the tuna industry - even the mobile groundfish is heading that way or is already that way. I guess the big concern is around the lobster fishery. It's been the heart and soul of independence for fishermen. I think there are 968 licences, and nobody knows for sure but perhaps 200 or more of those are already out of the hands of fishermen and into the hands of others, whoever others might be, because it's not registered, we don't know who they are. Is it processors? Is it interests from outside the country? We don't know, but it appears with the increase in the value of licences that more and more control is going outside the communities, outside the hands of the fishing families. It's dangerous as far as keeping our communities strong and keeping it in the hands of the operator.

MR. BURKE: Well, let's first go to your examples of groundfish and scallop. In the case of groundfish, I mentioned when you look at the last 15 years the underlying resource base for the groundfish fishery has certainly shrunk dramatically. There's still a very broad distribution of licence holdings in groundfish across this region - over 3,000 licences out there to fish groundfish. The problem is there are no groundfish to fish.

What we're seeing - in part it's a consolidation, but in fact it's just a reaction to the reality that we used to have a $250 million groundfish fishery out there and we now have a $70 million groundfish fishery out there. So you just don't need the same kind of infrastructure to do one as you did to do the other.

[9:45 a.m.]

A lot of the consolidation that you're speaking of in those other cases has come as a result of that kind of a response to what's really happening. What are the opportunities to actually pursue fishing? The same thing happened in the case of the Bay of Fundy scallop fishery. We had about 100 fishing licences out there at a time when the fishery was worth $40 million, when it dropped back to $10 million, we couldn't sustain that many operations, so there was a contraction and sort of a rationalization.

Part of what you see is actually a business response to opportunity. Don't be deceived, commercial fishing is certainly an important part of communities and community structures, but it's an important part because it's a viable business activity for those particular families and those communities that depend on those operations. What we're seeing here is a bit of dynamic that really comes from keeping the fisheries in a healthy economic state in order to be able to support local communities.

The overall issue that you are alluding to, you are more than alluding to you are mentioning specifically this business of the concentration of the ownership of a lot of licences, and particularly in the lobster fishery. All these licences are indeed, from the point of view of our transfers, in the hands of registered fishermen. Behind all of these arrangements, fishermen have to find capital to buy licences or to make their business ventures work. We don't have anything in our policy framework that dictates what kind of contractual arrangements fishermen enter into. In many cases, they probably enter into loans with banks to acquire their licences or to fund their fishing operations.

In other cases, they would have loans with perhaps other people in the industry. In other cases, we're told that they have these agreements with people who have control over their licences. As you point out, we don't really have any way of detecting which of those things might be the case or to what degree they are the case. There's a lot of speculation and there's been a lot of comment about this, and it's a very high-profile issue at the moment, but it's not something we actually have any rules against. Our policies do not address those kinds of issues at this point in time. We are talking about policies, these are not laws or regulations. They're not enforceable things that we police. These are administrative policies that we use to make decisions. The decision we do make is, you have to be a registered fisherman. If you want to come in here and have a licence transfer you have to be qualified as a registered fisherman and you're then eligible to receive a transferred licence. That's really what we have as a set of policy positions in place at the moment.

The whole issue is very complex, though. We do have a very large scale review going on of the matter. The minister has certainly made some strong statements about his concern, as voiced by others in the industry. We're expecting, sometime over the course of the Summer, to see a report on sort of what the situation is out there and what kind of changes can or should we be making with respect to dealing with this particular concern.

MR. PARKER: There's some evidence that there are a number of large processors or other outside interests that have already acquired a number of lobster licences. While it's held in someone else's name - I was down to Southwest Nova, around Shelburne County not too far back, and I was told one company had control of 23 licences. There's others that have bought up a number as well. One gentleman I talked to said he had two they just purchased. So there is becoming more and more control in the LFA 34 area for the lobster licences - more and more in the hands of fewer and fewer. It's a dangerous precedent.

I know my time is almost up here, Mr. Chairman, but somehow we have to get a handle on this and try to keep control over local fishery in the hands of local people. If it becomes concentrated too much in the hands of a few, who knows where it will end up? It could be interests outside our country. It's not beneficial for our communities when it's concentrated in the hands of too few.

MR. CHAIRMAN: Thank you, Mr. Parker. Mr. Theriault.

MR. HAROLD THERIAULT: Thank you for being here. Last time I brought up quite a few concerns about the fishery in the province, and they all seem to blame it on you fellows in Ottawa.

MR. BURKE: Well, we're not in Ottawa, we're right here, in the province.

MR. THERIAULT: I know you are. I've worked with DFO for many years for the fishermen.

I would just like to continue a little bit on owner/operator. Let's go back pre-Marshall, 1998. A lobster licence, a lobster rig could be bought in 1998, right up to mid-1999, before September 1999, $250,000 would buy a nice rig in the lobster fishery. That's not very long ago, is it?

MR. BURKE: Where was that, 34 you are saying?

MR. THERIAULT: Yes, in Area 34. So the Marshall decision happened and we had to do something to correct that. We all worked at it and the best thing to do was to have the Aboriginal fishermen fish with us, we work together. Fine, that was great, we kept peace down there and we worked that out, but we had to get them some licences and the fishermen said we will have no more, it is a limited-entry fishery, we can't have any more licences issued. I believe we issued one for just a little while and we all agreed to that, but we had to have a buyback to buy these licences up to satisfy the Marshall decision.

Licences were $250,000 when that decision was made to have a buyback, the next day it was $300,000. It was going slow the next day, $325,000, the next day $350,000, and on and on that went by DFO for how many months before they got to pretty near $1 million.

Big bucks - man, what big bucks for a licence just to get the Aboriginal people into that, had to do it to get those licences moving back into DFO's hands, and it's still there today. It has dropped a little bit because the fellow who is buying them all up is a little nervous about the owner/operator, so they're pulling their horns back a little bit, but DFO put that price up and the corporations saw a chance to pay big bucks to own this fishery - it's as simple as that.

MR. BURKE: Is it?

MR. THERIAULT: Money will buy anything, and they'll pay the bucks they have to pay to own it. If nothing changes it is going to continue and continue, and we will see the coastal communities of Nova Scotia a lot different than we have in the last 200 to 300 years - simple as that. The financial institutions of this country, the banks, the loan boards, nobody will touch the price of a $1 million to $1.5 million rig that you can only stock $200,000 to $300,000 in per year - it's just not financially feasible. Some who have done it are in trouble right now in southwest Nova Scotia. Everything mortgaged to the hilt trying to do it on their own - they can't do it, they're going behind right now.

So it is going to be taken over by somebody with the money. Whoever has the money to own this fishery is going to end up with it, if nothing changes. It's common sense to me and that's the way I see it. Our groundfishery went that way, their scalloping went that way. We used to have one of the biggest groundfisheries in eastern Nova Scotia on Digby Neck, the Islands, and Digby. It's down to one little fish plant working with a half dozen people in it. Most of the groundfishery concentrated in another place in Nova Scotia - and everybody knows where it is. I think this inshore lobster fishery can go the same way because as it's bought up, they will be putting three or four licences on one boat and, I believe, less people to work in it.

It's all about the money, you see it right here, the shellfish is worth 83 per cent of the fishery here so that's where to invest the money. Any big money has to be invested into that. It was into the ground fisheries and see where that is now. That's just the way I see it. I don't even know if I've got a question.

MR. BURKE: You made a few comments and if you're interested I would like to make a few comments.

MR. THERIAULT: I would like to get a comment on that and then I want to jump into the ground fishery for a minute.

MR. BURKE: First of all I'm sure that you're right in a sense when you do enter into a marketplace and you require some licences and we did do that with Marshall. We did put some kind of an upward pressure on prices somewhere but to take the specific example that you used in terms of LFA 34. There are almost 1,000 licences in LFA 34, about 10 to 20 per cent of those licences would change hands a year. You agree with that?

MR. THERIAULT: Always did, at a reasonable price.

MR. BURKE: That's between 90 and 180 transactions a year, just people trading and transferring licences between each other. All together through the entire Marshall process we bought about 20 licences out of LFA 34. If you say, for the sake of argument, that there were 140 licences a year for the three years that we've been busy in the market so all together almost 400 licences have changed hands and we've bought 20 of them. Now you tell me if you think we caused the price to move from $200,000 to $800,000 because we went into the market where 400 transactions were taking place and we bought 20 of them. Do you think that was the Marshall program doing that?

MR. THERIAULT: What did you pay for those licences?

MR. BURKE: We didn't pay any more than what the market was charging at the time so we've paid different prices at different times.

MR. THERIAULT: That's when the competition started.

MR. BURKE: We were hardly competitors is my point. There are other areas in Atlantic Canada where we ended up having to buy more licences out of a particular fishery where I would agree with you, we were making the price, so to speak, because we were forming the market, we were buying the majority of whatever was up for sale. That was not the situation in LFA 34 so I have to challenge the notion that we caused, the Marshall program caused, the prices to escalate as they did in LFA 34. We just weren't there with the kind of presence that would make that an outcome.

In the end, if people did pay, as we're speculating here that either people from away or locally are spending way more money than the fishery can support, there are a lot of cases in economic history where that's happened, where people have decided that there was something here that was worth a whole lot to them and they overpaid. The classic example was tulips in Holland 300 years ago- it's sort of a textbook story in economics. You can find a lot of other bubbles, people over-invest in property. I think Sony once bought Paramount Studios in Hollywood because they figured they were going to make a killing on the movies.

Whenever that happens it takes only a short amount of time before the people who have overspent, who paid more for something than it was really worth to find out that they've made a mistake. So if in fact these foreigners, these multinationals were in there as some people think then I would suggest to you that they're in for a pretty nasty surprise if the fishery can't support the value they've paid for these assets. So we'll see these people taking a loss if they've overpaid for these real resources because they're not going to take the lobster and fish wherever else they live. I've heard all kinds of stories of people from Toronto, Mexico, England or New York, some place, the lobsters don't live there, they live off the coast of Yarmouth, Digby and Shelburne, places along the coast. They're going to have to

come here to find those lobster and if they don't find this is really happening to the degree that it's reported to be happening, and I don't know that to be the case, then I think they would be in for some pretty nasty surprises over time and over a very short period of time because licences have to be able to sustain those values or they'll decline.

[10:00 a.m.]

MR. THERIAULT: But they will make them sustain that when they own it.

MR. BURKE: How?

MR. THERIAULT: Because they'll be catching the lobster so cheap.

MR. BURKE: How?

MR. THERIAULT: A lot cheaper than it's being done now.

MR. BURKE: How? Junior, you were a fisherman for a long time. If you could have caught lobsters cheaper than you can catch them and you could have caught them, wouldn't you have done that?

MR. THERIAULT: Once you own it all though, once you control the whole fishery and have the control of it, you could do that, but you can't as long as you're competing.

MR. BURKE: You still have to put your pants on one leg at a time, put those rubber boots on, get out into that boat, you know, you still have to go to sea and set those traps, you still have to get those lobsters to crawl into those traps, and that's how it's regulated. So they don't have any magic in New York, or wherever the heck this might be, about catching lobsters. I mean we know how to catch lobsters. They're the people who live here. I don't think we're going to see some dramatic change.

There has been technological change in the industry with respect to catching just about everything, including lobster, and we're seeing that applied in the fishery everywhere every day, but it's being applied by everybody and so we do have, you know, better technology, better gear, better boats, and people are using that, but all thousand people are out there competing just as strongly as whoever might be concentrating a licence. So they're not going to find it an easy task to somehow capture a whole flap of it when, in fact, it's a competitive fishery where you go out there and it's your skill that decides whether you're going to be a winner or a loser.

MR. THERIAULT: That was the way in the groundfishery last, but look how it was directed.

MR. CHAIRMAN: Mr. Theriault, I'm going to yank your line in, but we'll be glad to come back to you. Mr. Colwell.

MR. KEITH COLWELL: I have just a few questions. The ISA situation with the salmon, has that been worse over the last 10 years or better?

MR. BURKE: Well, it's more recent than 10 years, but it is an important issue. It still does occur. It's a combination, actually I'm not a biologist so I really can't speak to the technical detail about it, good husbandry practices is really what we try to do to prevent it and to control it. There are strategies for separating the cages of animals, for the density in those cages. There are strategies for separating year classes and leaving areas fallow, like having a site that you don't use every year, you know, once you've grown out a certain crop, you basically fallow the site for a while to ensure that it cleans itself from any residual diseases and these kind of strategies are being applied and we are having some success with them.

There have been other issues that probably confound the problem with respect to some of the salmon losses that we've suffered. We've had temperature problems like really cold spells that have killed salmon and there's often confusion as to what has really happened here. So overall I would say that there is progress being made on all those fronts, but it is certainly a challenge and the industry itself is always competing internationally with people who are able to perhaps have a different climate or are in better climate conditions and who are selling product on the market. So this combination of having a good healthy product that you're ready to put into a market and then you find that it's already glutted by salmon production from Chile or from Norway, or from other parts of the world, has really, you know, somehow often given a knock and coupled with sort of maybe setbacks that might have to do with temperature or with some kind of a disease.

So our industry is in sort of a fragile state now in terms of the aquaculture industry and it's undergoing sort of a transition. A lot of that is sort of based, as I said, in New Brunswick, but the same industry applies and works really across all the provinces. So they have sites in both Nova Scotia and New Brunswick and sometimes as well in P.E.I. and in Newfoundland and Labrador. So this is sort of the overall picture and, in there, the strategies for dealing with ISA are making gains, but there's a way to go.

MR. COLWELL: On another topic, what progress have you made or are you heading in the direction of a sustainable seal harvest from the standpoint of producing a product to sell the same as you do a codfish, lobster, or shellfish?

MR. BURKE: I think the harp seal fishery has established itself as a good economically-viable operation, selling quite a bit of the product from the pelt on in. There are other species of seal. Primarily, in this area, the grey seal, it's a much larger animal, it's not as numerous in terms of the sort of overall abundance. We haven't yet developed a commercial operation that's able to handle the product and produce a variety of products

from it, or handle the big animal and produce a variety of products from it. So there isn't a universal answer to your question, it depends upon the species, and the harp seal is there. The grey seal which is really more seen here as an issue, doesn't have that, and we're involved with the industry in looking at some developments in that area to see whether we can have a sustainable grey seal harvest.

MR. COLWELL: On the grey seals, what steps have you taken? Have you done any research on markets, exactly what stage is that at?

MR. BURKE: Well, historically, there have been a number of efforts over time to come up with market opportunities for the grey. Some ideas have proven okay and others - I mean markets are very fickle anyway, you know, they tend to change. People like skins one time and they're not a fashion statement in other times, or there are other aspects of the product that come and go into vogue. So there has been some work done 10 years ago, even on markets in developing other products. There is a group now that's looking again at reviewing that market opportunity and adding new ideas to it, but it's just really in that stage.

MR. COLWELL: As you probably know anyway, the grey seal is one of the hosts for the cod worm. With the explosion in the population of the grey seal, the cod worm must be getting to be a tremendous problem?

MR. BURKE: Well, it would be a huge problem if we had a large groundfish fishery I guess, I would expect anyway. The focus around the grey seal population tends to be on the eastern Scotian Shelf towards Sable Island and into the Gulf of St. Lawrence, and the groundfish fishery that we do have remaining in this province, basically, if you ran a line of Halifax here and you go south toward the U.S. border, that's where we're seeing most of the groundfish fishery that we currently have in the province. So in the area where we would have grey seal prominence and, the seal worm issue, it was always historically on the eastern Scotian Shelf anyway to a greater degree than any place else. We just don't have the fishery where it shows up, if you want, in terms of an issue.

MR. COLWELL: Now.

MR. BURKE: Now.

MR. COLWELL: It will come because they sit dormant for quite awhile.

MR. BURKE: Well, we hope to have the codfish to have the problem, okay. We just don't see the big signs of recovery on the groundfishery on the eastern Scotian Shelf.

MR. COLWELL: The grey seal, what's the population now as compared to what the normal average population used to be say 25 to 50 years ago?

MR. BURKE: I'm afraid I don't have those numbers right off the top of my head. I think the current population numbers are in the order of 260,000 animals on the Sable population, and there's another population in the Gulf of St. Lawrence whose numbers I'm not exactly sure of. Historically, I think that the population was as low as - Clary, can you help me with that, was it 8,000 or 9,000 animals?

MR. CLARY REARDON: It was really low in Sable.

MR. BURKE: I can get you those numbers, but I just don't have them here.

MR. COLWELL: Yes, if you would, it would be very useful.

MR. BURKE: Sure, I can do that.

MR. COLWELL: The committee will send you a letter and request it, actually.

MR. BURKE: Okay, that's fine.

MR. COLWELL: That will be okay?

MR. BURKE: That would be great.

MR. COLWELL: Also, there have been all kinds of discussions about the seals over the years and how it affects the commercial fishery and how it may help deplete the cod stocks, along with all kinds of other things. There is some information we would just like the base information on, and there are some studies about how much a seal eats a day. Could you also supply that information as well when you reply?

MR. BURKE: In writing.

MR. COLWELL: Yes, in writing, the actual documentation, because it's very, very important information to have. (Interruption) Yes, it's scary. I think it's a lot more than the commercial fishery, period, total. Eighty-eight times more. So it's a serious problem and that's why I think it's important that we make every effort we can as a province and as a federal government, the provinces really, to find solutions by sustainable harvesting, with proper controls put in place - that the population is not decimated or anything, because that wouldn't be positive either - that would make employment, it would help the fishery overall and also help our exports or economic situation, especially in Nova Scotia and rural Nova Scotia, where the economy seems to be shrinking really quickly and everything being concentrated in the bigger economic areas. So, that's information I would really like to have and I'm sure the committee members would like to have that as well. (Interruptions)

MR. CHAIRMAN: Make this your last one.

MR. COLWELL: My last little question? Okay. Actually can I give my last question to Mr. Theriault? Can I do that?

MR. CHAIRMAN: Sure.

MR. THERIAULT: The seals, right. How much groundfishery quota do we have in the Scotia Fundy, approximately, 13,000 tons or something?

MR. MCMASTER: In division 4X, which is the majority of our groundfish fishery, cod and haddock, we have a quota of 6,000 tonS of cod, 10,000 tons of haddock, and the pollock quota was just cut down to, I think, 6,500 tons this year. So you're looking in total in excess of 20,000 tons. Probably 25,000 tons. That's in 4X, off the coast of Nova Scotia.

MR. THERIAULT: So that's about 40 million pounds?

MR. MCMASTER: Yes, somewhere in the region of 40-50 million pounds.

MR. THERIAULT: Right, and the grey seal herd off here, we have 400,000 grey seals, and for years that population stayed around 10,000. Is that correct?

MR. BURKE: We'll have to confirm to population numbers.

MR. THERIAULT: Yes, and I believe the study has been done and they're eating a minimum of 20 pounds of fish per day, these 800-pound animals. Could you figure that out? (Laughter) I'll tell you what it will come to. It will come to 2.2 billion pounds of groundfish being eaten right here off the coast by these huge animals, and we're allowed 40 million pounds a catch for practically the whole Scotia Fundy. I mean that's a little out of balance here. Not a little, it's a lot out of balance. We're talking about a $1 billion or $2 billion worth of fish going to waste here for an imbalance that I think probably we man have done, the fishermen have done it, we've done it, through climate change, through whatever we've done out there. Has the department thought about trying to correct this balance, and what's going on with the grey seal?

MR. BURKE: As I said, we will get you some information on numbers and populations and feeding habits and so on, but just as a general comment, I think one of the things that they have established with respect to diet is obviously seals while they eat, they don't eat popsicle as someone once said. They also do eat a lot of stuff that we don't catch. They eat a lot of sand lance. They eat a lot of other species that are quite common and very abundant but are not commercial fisheries, not commercial species. So, I think there's an argument that goes that a lot of what seals eat is not directly translatable to commercial fishery impact. We'll have to get that information for you, but I think that's going to be one of the things that's going to be in that information, in terms of my understanding, of the diet studies that they've done for seals - grey seals in particular.

[10:15 a.m.]

MR. CHAIRMAN: I'm going to give the chairman a chance to ask a question or two.

Back in February we had the Guysborough County and Inshore Fishermen's Association and Gulf Nova Scotia Bonafide Fishermen's Association, and in March we had the Lobster Fishermen's Association for LFA 33 and LFA 34, and all three of these organizations spoke about owner/operator and fleet separation and raised it as a significant concern. I don't think I can necessarily blame you two sitting here today because it would seem to me that you probably have other bosses and, in particular, a minister, but I do have to say that I want to take issue with the notion that policy is not law.

Well I recognize it's not, but in the world I live in, I'm an Opposition Member and it sure seems that when I go to the Department of Transportation they say "this is our policy", I have a hard job getting them to move off any particular policy. I find it hard to understand that if there's a policy that DFO has on this issue, they don't seem to be enforcing it to the degree that these fishermen's organizations - and this wasn't three fishermen, this was three organizations that represent a large number of fishermen, and maybe I can say that the minister and I don't have the same vision for the impact of what this does to fishing communities, because what I see as the important thing is keeping communities sustainable and viable.

They might say this is the natural progression, it's all going to wind up in the hands of a few and that makes it easier to manage, and in the world of business, that's what you do, but in the world that I think about we have anti-combines legislation, we put laws in place because we hold up a certain interest. I think the interest, from what I can understand - and I'm not from a fishing community but I sure try to listen to the people who speak to me in this regard - we're running the risk of the demise of fishing communities, not to mention the livelihoods of people who fish for a living. It seems to me that DFO has a policy that should stop that, but is not acting on it. How far off the mark am I in my interpretation of what I am seeing?

MR. BURKE: Well as I mentioned earlier we do have an owner/operator policy. The policy does not in any way address the contracting ability or the contracting flexibility of participants in the industry . . .

MR. CHAIRMAN: What do you mean by that?

MR. BURKE: First of all, we apply the owner/operator policy across the board. It's always applied so if a person comes in and says they have a lobster licence, or another kind of licence, that they want to get rid of and have found someone who is an eligible owner/operator bonafide guy to whom they want to transfer this licence, we look at those two parties and ensure that the guy who is going to get the licence is this qualified owner/operator

person and his name is the name that we transfer that licence to. That is the policy, we've been applying it religiously and we continue to do so.

What I know other people have told you, and what's certainly very big in the press, is that somehow behind these two players there is a set of contracts that somehow influenced the behaviour of the guy who has acquired the licence . . .

MR. CHAIRMAN: That would be trust agreements, I guess.

MR. BURKE: Well that's sort of a common parlance of a trust agreement, and a trust agreement is nothing more than a contract- it's a mortgage or some other kind of a civil contract between two parties. The policy doesn't speak a word about contracts and there is, in fact, some question as to whether or not we have any jurisdiction, federally, in fact that's typically provincial jurisdiction, to deal with contract law. The policy is really the decisions we make with respect to these kinds of transactions, and we apply those policies in this region as we do across Atlantic Canada.

MR. CHAIRMAN: What you're saying is, you have a policy that should maintain owner/operator but wink, wink, nudge, nudge, we're going to allow trust agreements or other agreements or contracts that go around that because our policy doesn't address it, but we see them going around our policy and we're not going to step in and stop it. Is that what you're telling me?

MR. BURKE: Well, I guess it's a matter of whether we have any authority to step in and stop anything in that sense, right? I mean we don't have authority to step in and stop, is my point.

MR. CHAIRMAN: Okay, why don't you?

MR. BURKE: Parliament of Canada, the Constitution of Canada and the authorities of other jurisdictions are the reasons why.

MR. CHAIRMAN: So, do you guys go to the minister or your boss and say, look, this is a problem? Do you have any documentation to say that we pursue this, we see it as a problem, because you're not indicating to me that you see it as a problem, number one.

MR. BURKE: No, as I mentioned earlier, this is exactly what's happening at the moment, right. We do have a study going on at the moment that's come as a result of the surfacing of this issue as an issue among fishermen in this region and in other areas, and that we are currently looking at what the nature of that problem is and what kind of actions can be taken, if any, by us or by other people, to deal with it. That report will be coming out this Summer, but it doesn't have the answer or an answer at this time.

MR. CHAIRMAN: Okay. It looks like, I have something here that indicates that in terms of snow crab fleet, that there was a movement in this way, licence transfers or whatever, that DFO, in the Gulf region, kind of put the kibosh to that happening. Do you know if anything went on there?

MR. BURKE: I know a little bit about it. What we have in that case, as I understand it, is we had two parties who had been involved in an exchange of licences. The Gulf region that was having to transfer these licences, the parties were moving licences between two administrative areas in the Gulf. There was some question, I guess at the end of the day, as to whether or not there were trust agreements involved that somehow violated this owner/operator policy. There were a number of different things that raised questions on the particular transaction, and the Gulf, in administering its policy said, no, there's many things here, so we're not going to continue. We're not going to consummate this arrangement by making this transfer. So the two parties actually sued each other to get something together, and the suit was all about whether or not they had a viable contract between themselves, which the judge declared that they did, but the contract ostensibly obliged us to do something, which we didn't have to do if it didn't comply with our policy. So the region, in this case, the Gulf, has not continued the deal because it discovered through the process that it wasn't violating the policy. Now what didn't happen in that judgment was that no one asked the question as to whether or not the department could, in fact, hold back those licences, because all the court decision has been about so far is to whether or not there was a valid contract between the two parties. What the court hasn't said is, is it reasonable for the department to withhold its transfer authority of that licence under the circumstances? That question wasn't answered in the court case, as I understand it.

MR. CHAIRMAN: You said the DFO wouldn't consummate the agreement.

MR. BURKE: Well, which is the same thing we would do if we understood that something was violating the policy. If you were coming in and you weren't a bonafide owner/operator, we wouldn't transfer the licence to you.

MR. CHAIRMAN: Okay, there seems to be a contradiction, but I don't want to take time away from the other members of the committee. So we'll start over again with Mr. Langille.

MR. BURKE: Thank you.

MR. CHAIRMAN: You're welcome.

MR. WILLIAM LANGILLE: Just before I ask . . .

MR. CHAIRMAN: Can I interrupt, Mr. Langille, I'm sorry. I just wanted to acknowledge, at least as an observer, that Mr. Clary Reardon is here from the Department of Agriculture and Fisheries, and when Mr. Burke referred to him, I thought we should put on the record that there actually wasn't a shadow there, that there was somebody. So I want to say welcome, Mr. Reardon, so for the record, we know that he was here. Go ahead, Mr. Langille.

MR. LANGILLE: Before I get into my question, just something the member for Preston brought up and that is about the cod. I just want to say, it always seems that the Department of Fisheries defends what the cod eat, and that's gone on for years now. I look at biologist reports, and I'm not expert but I see the size of these seals, but anyway.

The worms in cod. What's the legal amount that you're allowed, how many worms are you allowed in a pound of cod in Canada?

MR. BURKE: I don't know that there is a harm associated with worms in cod, believe it or not.

MR. LANGILLE: No, I'm not saying that. I said, how many are you allowed?

MR. BURKE: Actually, I don't know that, that would be a question probably for the CFIA people, the inspection people. I think any amount of worms is not very good for the market. Typically the fish are handled and put on a light table and worms are removed as you would know.

MR. LANGILLE: My understanding, I don't mean to cut you off, is nine worms per pound in Canada and 12 in the United States but I could be wrong on that. There's nothing wrong with cooked worms I guess. I'm always concerned when it comes to funding, that we've established shellfish are on the increase and that's our fisheries that we're targeting now and lobsters are our most important product in Nova Scotia when it comes to fishing right now. What I'm concerned about is if the most important fishery is lobster, in Nova Scotia, and science is very important - it's my understanding that you're reducing your emphasis on science. To go with that, what are DFO's plans for size in the future?

MR. BURKE: First of all, I guess it's probably worth noting that in this region on the DFO component, not Coast Guard, the budget for last year was $92 million. The Coast Guard budget was another $72 million. The Government of Canada spends a fair bit of resources and that would cover our science activities, our enforcement activities, our general administration and management activities across the board. So there's a fair bit of public support and public spending for the activities of the department here in this region, that's not Atlantic-wide or nationally.

As I mentioned at the outset, clearly our understanding of what the utmost kind of science priorities should be switches over time. It responds to what we understand to be our next set of challenges. One of the changes announced in the budget that hasn't yet been approved have been some changes to science programming in Canada. The move is from single species focus, as I mentioned earlier, to a broader ecosystem focus. We will be trying to place the single species in a better understanding of the environment as a whole. There is that shift taking place and funding has been moved from, generally speaking, single species activities to this kind of a view. We've seen some reductions and some expansion as a result in the budget. When you net it all out it comes to about the same.

MR. LANGILLE: I guess my specific question was to lobster and I understand there was a cut to funding programs of lobsters.

MR. BURKE: Not that I'm aware of.

MR. CHAIRMAN: Mr. Sampson.

MR. GERALD SAMPSON: Mr. Burke, I've just met you this morning and I would like to say that Johnny Cochrane lives through you because confusion reigns - I have no comprehension as a person who grew up around the water, lived on the water all my life, but I sure as heck wouldn't want to be involved in the fisheries industry because I can see why it's sliced and diced the way it is because that way it's easier to manage when you're totally involved in it and others on the outside looking in. Anyway, having said that, I hope when you retire you will write a book or the real you will come out of that bureaucratic shell.

[10:30 a.m.]

MR. BURKE: I'll be moving back to Petit-de-Grat.

MR. GERALD SAMPSON: Okay, great. That sounds good. My question is, I had some lobster fishers come to me - ladies - down in Cape North, at a recent meeting. They are lobster fishers and some of them have a crab licence too. The problem they are facing is that I believe in one area one lady said that - I may not have this proper - she must be on board the boat in order for the boat to fish because she owns the boat and she's the skipper. But there's not a job anywhere in Canada where if you get sick - she said, I can't call in sick. I could be home with the flu, sick of some kind and then if I'm sick, as the owner and skipper of the boat my boat cannot sail, my crew doesn't fish and I can't operate that way.

The second question was, every time they pull their herring net now for bait, there's a dollar charged and there's a limit on the quota of fish they can take out of the net. So if they pull the net and they get - for round figures - 1,000 pounds of herring out of that net and there could be 2,000 or 3,000 pounds in the net, they must leave the rest of that fish there and pay

the dollar fee to pull it the next time. But, a fish that's dead in a net for two, three or four days is not going to be useful.

So there's two problems there, but I think the main one is the fact that if the person who owns the boat becomes ill and can't fish that day then the boat can't leave the dock. Is there any way around that? Can that be resolved or is that another policy that nobody wants to change?

MR. BURKE: Mr. Theriault can probably tell you that if you're sick you can get someone to operate your boat. That's not a problem. I don't know why the lady would have a problem with that issue.

MR. GERALD SAMPSON: Well, they were quite concerned that they can't - they're not looking for a day off, but they can't take it.

MR. BURKE: Junior can help you with that one, I'm sure.

MR. THERIAULT: You can get up to five years for medical purposes to have somebody run your boat. No problem. All you need is a doctor's certificate.

MR. BURKE: On the other question, I've never heard of a fee for pulling your net. I don't know where that's coming from, I'm not aware of that at all. I won't confuse you with any bureaucracy about it, but I just don't know.

MR. GERALD SAMPSON: Could that lady have somebody for a day or two? I understand if she was sick and couldn't fish anymore, I can see getting someone long term, so they hire Cathy Jo to run the ship for the next five years, but if she has a day or two sick, she cannot go.

MR. THERIAULT: You just need a doctor's certificate.

MR. BURKE: It's interesting. All these policies where the government - for example, the owner/operator policy generally, we've been talking about it as a good thing for its purposes, but it's a new level of bureaucracy that the government now imposes on you. So if you're sick, you have to come to us and get permission to have somebody else operate your boat - which you can. Everything has a downside and this happens to be the downside of the owner/operator policy.

MR. GERALD SAMPSON: This being an extremely rural area, that lady would have to travel for close to an hour to get to a hospital, to see a doctor, to get a slip in order to go back. If you're sick, you can't - you know what I mean?

MR. BURKE: No common sense in that.

MR. CHAIRMAN: Mr. Sampson, can I move on?

MR. GERALD SAMPSON: Thanks, that's it. You can move on.

MR. CHAIRMAN: Mr. Theriault.

MR. THERIAULT: I could just continue on about the groundfishery, but I won't go on any farther with it. I would like to have all the information you do have, Les, about the grey seals off this coast. I know the department must have it - we have a problem, a big problem. If this is true, and I believe it is, there's a big imbalance out here. I know it's a sensitive issue, but it's a sensitive issue, you know there are people who raise these concerns that don't live in reality here, they're people who live in whatever.

I believe we here and our people, there are people on this coast who can't make a living in the groundfishery because the fish are so scarce out on the shore, and in the Bay of Fundy too. The closer you get to shore, the scarcer the fish get and that's where the big population is of seals, and it's growing and growing. If we don't correct that, it's not right, it's not human. It's not human to let animals take your livelihood away, that's just not natural. So we have got to work at that and correct it. I won't ask any more questions, I just wanted to state that to you and it would be nice to work together on it.

MR. CHAIRMAN: Mr. Parker.

MR. PARKER: We've only got a few minutes, but I want to come back to this concentration of the fishery and the owner/operator policy, I guess, as was mentioned by two or three others, but it seems like, technically, the requirements are being met. The owner/operator policy is there, but it seems there's a loophole there a mile wide and 100 fathoms deep. It's just so big that we're getting right through it and it's all to do with trust agreements. We don't really know then who controls the licence, the beneficial use of the licence.

You were saying earlier that the fisherman will still go out on the water, he will still be putting his pants on one leg at a time, but who's he working for? Will he be working for himself or will he be working for somebody else? It's a big question. We don't really know at this moment who does control the fishery. Some of it's owned certainly by the operator who's in the boat, but some of it's controlled, they're called slipper skippers, I think, they're actually working for somebody else. So who is it that controls our fishery?

So I guess my question is, coming around to recently that we've talked in the Legislature about trust agreements being registered so we would know who it is who actually controls our fishery. Just like a mortgage on your house, you have to register it through the Registry of Deeds. It's not going to change it, but then at least we would know whether it's your father-in-law who holds the trust agreement, or whether it's the businessman down at

the corner store, or if it's the processor, of if it's somebody from China. Who is it who owns it? So I would just like to hear your thoughts on the registration of trust agreements. Do you think that would help give us a handle on what's happening in the industry?

MR. BURKE: Well, you know, I think it's interesting that you're speaking about it in the provincial Legislature. As I said earlier, my understanding, and I may be wrong, but my understanding is that this is an area of provincial jurisdiction. I mean, if that's what you folks are going to end up doing, I don't know how it will affect things at the end of the day. You'll have a new registry and we'll know more than we know now, I guess, from that point of view.

I think one of the challenges is that even if we knew, if you had a document that was registered, a loan or a mortgage, or whatever it might be, then you would be left with deciding whether that was a good trust agreement or a bad trust agreement. So you would have to go in there and kind of read through the terms of the agreement to decide whether or not the contract has somehow tipped the balance away from the guy who owns it. It's moved from being a loan, to being an ownership situation, an equity, if you want to put it in those terms, from debt to equity. So it gets very, very involved administratively to figure out what's a good one, because they're all going to be just contracts, and what's going to be a bad one.

MR. PARKER: Knowing that, knowing who owns them and how they're set up, would that help you determine whether the owner/operator policy is being withheld, or held up, or being violated?

MR. BURKE: Well, it would certainly seem to put more information on the table, yes.

MR. PARKER: So you're not opposed, or are you in favour of such a plan?

MR. BURKE: Well, I think there's a lot more information to find out whether it would help us or not, but I think one could investigate that. I think that is one of the things that we're doing through this broader-based study as to what kind of things could be done, who would have to be responsible for doing them, would the province take on the responsibilities to setting up the registry or, if it's already there, adding to it, reviewing the agreements and bringing that information forward.

MR. PARKER: It could be a tool then to help enforce the owner-operator better.

MR. BURKE: It could, I'm not saying that it would or wouldn't, but it would certainly be more information.

MR. CHAIRMAN: Mr. Colwell.

MR. COLWELL: Back on the seals again, it's the favourite topic of mine. I get up in the morning, every morning- I live on Porter's Lake, a lake that has a small opening to the ocean, and I've watched five grey seals having breakfast in front of my house with whatever fish happens to be there. It's a small area for big seals. I think they're eating up all the gaspereau that are coming through right now or a good chunk of them, they seem to be following through. This is an occurrence every year, we see them this time of year and probably for another two or three weeks, maybe a month, then in the Fall they come back again when the striped bass come in and the salmon and all the other more expensive fish are there than the gaspereau.

I'm hoping that the DFO will do some more studies on this and see - I don't know if you have any funding to help commercialize the grey seal - to a point where it would make sense to have a small modest harvest to make sure that the product is out and sell it as a product because it's not acceptable to do anything else in our society today, which is probably a very positive thing. Have you any plans to move towards making it a product that we can sell from Canada?

MR. BURKE: Well we do have a developing fisheries policy that essentially moves us from experimental stages with harvesting and allows the industry to develop a range of products that it can test market. We can move on to higher levels of whatever the population can bear in terms of a commercial exportation level. That program is available, we've worked with industry over the last couple of years to try to get their part of this. The department does not have a funding program for that but other parts of the government, sometimes the province and, in fact, agencies like ACOA might, as well as other federal agencies.

We have certain mandates and we don't have others but the industry is able to approach these other agencies for support and put proposals forward to get funding for certain kinds of things, including market work and so on. That's all there, it's just not all in DFO per se.

MR. COLWELL: One question, you probably can't answer this question but maybe you can let us know afterwards who we can contact. Seal meat is basically fat free, I understand, all the fat is between the meat and the skin so it has a potential of being a very healthy, low-fat diet rather than beef or some other things that are concentrated with fat all through it for people with different medical conditions that might be of concern. Have there been any studies done on that or who would we look to see if there have been studies done on that?

MR. BURKE: I think there has been a fair bit of marketing work including the attractiveness of flesh for human consumption. I don't think that it has been a big hit in the restaurants of Paris or other places where they might eat it. So it hasn't made that transition

yet for whatever reason but I know that some of that work is done and we'll try to get you information.

MR. COLWELL: Even if we get the contacts so we can follow that up, would be great.

MR. CHAIRMAN: I have a question around Coast Guard and its role or responsibility under DFO. I was listening, I think it was this morning on the radio, to one of the commentators and it was around the release of oil about 50 miles off of St. John's. This individual's particular interest was around seabird and it was the eider ducks in particular that had died as a result of this.

[10:45 a.m.]

Now it seemed that it was difficult for the government to lay a charge, or I'm assuming it would be the Coast Guard that would do that - but maybe you can correct me. I'm curious, and I heard this more than once, about the inability to actually lay a charge for an oil slick. This is not from an oil tanker . . .

MR. BURKE: Just bilge water . . .

MR. CHAIRMAN: Bilge water. So I'd just like to know if there is such a thing as the Coles Notes version, in terms of laws and the inability to enforce them. Can you . . .

MR. BURKE: Well, it will be Coles Notes, because this is not my area.

There are laws, we do often detect slicks; in fact our fisheries patrol boats, our airplanes are quite often the agents who identify that we have an issue with a slick. We can often even track it to a vessel that we highly suspect is the culprit. What you have to be able to do in criminal law, because this is a criminal situation, is prove beyond a reasonable doubt that you actually have the person who has committed the offence - and that's where the challenge comes in. These people would typically do this dumping in the middle of the night or at some time when getting evidence of this actually happening is a more difficult thing - and being able to prove that you actually have the right person and bring it to court successfully is where the challenge comes in.

It's a matter of the difficulty doing it in a marine environment where you're not there all the time. They're obviously doing it in a way that is aimed at preventing detection, that's part of the process.

MR. CHAIRMAN: Similar to the lobster, trying to . . .

MR. BURKE: Well, it's similar to anybody who is trying to break the law, I guess. They have a particular advantage of being out there where there are not a whole lot of cops standing around on each corner.

MR. CHAIRMAN: Are there any questions from any of the other members?

MR. GERALD SAMPSON: I'd just like to make a comment on the bilge water. All you'd have to do is make sure when that ship is in a port that it receives a certificate having its bilge pumped and taken ashore and processed, process the water. So when it leaves the dock, it has a clean bilge. Its bilges should be full when it comes into port and they have to pay to have them pumped, not have it leave the dock with full bilges and then dump it out at sea for free. It's a little bit of a policing matter, but it's simple enough to solve.

What I understand is that the bilge water from any ship is almost the same as your DNA - each ship has its own specific type of nutrients or whatever, contaminants, that would identify the ship.

MR. BURKE: Very interesting.

MR. GERALD SAMPSON: The prosecution rests.

MR. CHAIRMAN: In light of the lack of questions and the fact that we all have to get back to our own caucuses prior to the House opening at noon, I want to say, on behalf of the committee, thank you very much for your presentation and your answers, and your time, we appreciate it.

MR. COLWELL: Just before we adjourn, I'd like to ask the committee to consider - this is a very complex issue, as everybody around this table knows, and I would like to suggest, maybe, that we plan a trip to St. Andrew's, New Brunswick, or some other location, to talk to Fisheries in more detail, maybe over a couple of days, on all these different topics, and maybe if they would be willing to set up with particular individuals - we've had some specific questions on enforcement and on all different issues - maybe we could set up some meetings there with them to get more detailed information. I think it would be helpful to us. I know the committee has done that in the past, and usually a member of the provincial Fisheries Department comes with us so they're aware of what's happening as well. I would like to make that a motion, actually.

MR. CHAIRMAN: I think that's fine. I think what the committee should recognize is, really, we want to make a motion to make the request to the Speaker, because that's where the decision is going to be made. I don't think we need a motion. If the committee is in agreement, we could make a request to the Speaker for a trip - you said St. Andrew's, but . . .

MR. COLWELL: Maybe the committee could talk about that . . .

MR. CHAIRMAN: With DFO for further information. Are you in agreement? Yes. Okay, we can do that, Mr. Colwell.

The meeting is adjourned.

[The committee adjourned at 10:55 a.m.]