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37th PARLIAMENT, 3rd SESSION

Standing Committee on Fisheries and Oceans

EVIDENCE

CONTENTS

Tuesday, April 20, 2004

1100

The Chair (Mr. Tom Wappel (Scarborough Southwest, Lib.))

Mr. Loyola Hearn (St. John's West, CPC)

The Chair

Mr. Loyola Hearn

The Chair

Mr. Loyola Hearn

The Chair

Mr. Bob Wood (Nipissing, Lib.)

The Chair

Mr. Bob Wood

The Chair

Mr. Loyola Hearn

1105

The Chair

Mr. George Da Pont (Assistant Deputy Minister, Human Resources Corporate Services, Department of Fisheries and Oceans)

1110

Mr. Loyola Hearn

The Chair

Mr. George Da Pont

The Chair

Mr. George Da Pont

The Chair

Mr. George Da Pont

The Chair

Mr. Loyola Hearn

The Chair

Mr. Loyola Hearn

The Chair

Mr. Bill Matthews (Burin—St. George's, Lib.)

Mr. Loyola Hearn

Mr. Bill Matthews

1115

Mr. George Da Pont

Mr. Bill Matthews

Mr. George Da Pont

Mr. Bill Matthews

Mr. George Da Pont

Mr. Bill Matthews

The Chair

Mr. Rodger Cuzner (Bras d'Or—Cape Breton, Lib.)

Mr. George Da Pont

Mr. Rodger Cuzner

Mr. George Da Pont

1120

Mr. Rodger Cuzner

Commissioner John Adams (Canadian Coast Guard, Department of Fisheries and Oceans)

The Chair

1125

Dr. Wendy Watson-Wright (Assistant Deputy Minister, Science, Department of Fisheries and Oceans)

The Chair

Dr. Wendy Watson-Wright

The Chair

Dr. Wendy Watson-Wright

The Chair

Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP)

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

1130

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. George Da Pont

Mr. Peter Stoffer

Mr. George Da Pont

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

1135

Mr. Peter Stoffer

The Chair

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

The Chair

Mr. Andy Burton (Skeena, CPC)

Mr. George Da Pont

Mr. Andy Burton

Mr. George Da Pont

Mr. Andy Burton

Commr John Adams

Mr. George Da Pont

The Chair

Mr. Andy Burton

Mr. George Da Pont

Mr. Andy Burton

Mr. George Da Pont

1140

Mr. Andy Burton

Mr. George Da Pont

Mr. Andy Burton

Mr. George Da Pont

Mr. Andy Burton

Mr. George Da Pont

Mr. Andy Burton

Commr John Adams

1145

Mr. George Da Pont

Commr John Adams

Mr. Andy Burton

The Chair

Commr John Adams

The Chair

Mr. George Da Pont

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Mr. Paul Steckle (Huron—Bruce, Lib.)

Commr John Adams

Mr. Paul Steckle

Commr John Adams

1150

Mr. Paul Steckle

Commr John Adams

Mr. Paul Steckle

Commr John Adams

Mr. Paul Steckle

The Chair

Mr. Paul Steckle

Commr John Adams

1155

Mr. Paul Steckle

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Commr John Adams

The Chair

Mr. Peter Stoffer

1200

Dr. Wendy Watson-Wright

The Chair

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

The Chair

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

1205

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

The Chair

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

Commr John Adams

1210

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

The Chair

Mr. Rodger Cuzner

Commr John Adams

Mr. Rodger Cuzner

Commr John Adams

The Chair

Commr John Adams

Mr. Rodger Cuzner

Commr John Adams

Mr. Rodger Cuzner

Commr John Adams

The Chair

Commr John Adams

The Chair

Mr. Loyola Hearn

Commr John Adams

Mr. Loyola Hearn

Mr. George Da Pont

1215

Mr. Loyola Hearn

Dr. Wendy Watson-Wright

Mr. Loyola Hearn

Dr. Wendy Watson-Wright

Mr. Loyola Hearn

Dr. Wendy Watson-Wright

Mr. Loyola Hearn

The Chair

Mr. George Da Pont

Mr. Loyola Hearn

1220

The Chair

Mr. George Da Pont

Mr. Loyola Hearn

The Chair

Mr. Loyola Hearn

The Chair

Mr. George Da Pont

The Chair

Mr. George Da Pont

The Chair

Mr. George Da Pont

The Chair

Mr. Peter Stoffer

1225

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

The Chair

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

The Chair

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

Dr. Wendy Watson-Wright

Mr. Peter Stoffer

The Chair

Mr. George Da Pont

The Chair

Mr. Peter Stoffer

The Chair

1230

Mr. Peter Stoffer

The Chair

Mr. Loyola Hearn

The Chair

Mr. George Da Pont

Mr. Loyola Hearn

1235

Commr John Adams

The Chair

Mr. Peter Stoffer

1240

Commr John Adams

The Chair

Mr. Peter Stoffer

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

The Chair

Commr John Adams

Mr. Loyola Hearn

Commr John Adams

1245

The Chair

Commr John Adams

The Chair

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

The Chair

CANADA

Standing Committee on Fisheries and Oceans

NUMBER 010

3rd SESSION

37th PARLIAMENT

EVIDENCE

Tuesday, April 20, 2004

[Recorded by Electronic Apparatus]

Á (1100)

[English]

The Chair (Mr. Tom Wappel (Scarborough Southwest, Lib.)): I would call the meeting to order. There's no use making our witnesses wait.

Before we get to our witnesses, there are a couple of points, members. First, I don't know if any of you saw the article in Quorum from last week, I believe, entitled “Polluting ship hit with record fine, but there's no one left to pay it”. This is the Olga, the one we found in Iceland. The court ordered a $113,000 fine, and of course there's absolutely no one around to pay it. And contrary to usual policy, they didn't take a letter of undertaking from a law firm; they took it from agents, who disappeared. So that's just an update.

Secondly, there will be no meeting of the committee on Thursday; rather, we're going to have a meeting of the steering committee on Thursday at this time slot to map out our course of action for whatever time we have, or we decide that we have, and what the committee should do.

The earliest there will be another meeting of the full committee will be next Tuesday. Hopefully there will be a meeting of the committee next Tuesday on some subject matter that the steering committee recommends.

Mr. Loyola Hearn (St. John's West, CPC): Will the minister respond to our report--

The Chair: Mr. Hearn, do you want to go on record?

Mr. Loyola Hearn: No, I just have a question. Are we going to review the minister's--

The Chair: The minister's response to which report?

Mr. Loyola Hearn: The east coast visit.

The Chair: Yes, that's certainly something we could put on the agenda for the steering committee, absolutely.

Indeed, one of the things I'm thinking of is that we perhaps start looking at the responses to various reports and get the appropriate people from the department in to tell us how they're doing on those things, but that's something we'll discuss at the steering committee.

Mr. Bob Wood (Nipissing, Lib.): I think we should send the coast guard over to get the Olga in Iceland and tow it back. It would be a great project for Mr. Adams and his crew. We could claim it for Canada.

The Chair: You and I saw that ship, and I'm not sure it would make it back.

Mr. Bob Wood: That would be a good thing.

The Chair: We're now onto our final day on the main estimates for 2004-2005, votes, 1, 5, and 10, all pursuant to Standing Order 81(4).

We have with us today the Commissioner of the Canadian Coast Guard, John Adams; the assistant deputy minister of science, Wendy Watson-Wright; and the assistant deputy minister for human resources and corporate services, George Da Pont.

We'll start with Mr. Hearn.

Mr. Loyola Hearn: Thank you very much, Mr. Chair.

Let me thank the witnesses for being here. I know at this time of year they have lots of other things they would rather be doing, or should be doing, than be here with us, but I believe it's important also.

I think my questions this morning, starting off at least, will probably be to Mr. Da Pont, who I understand is responsible for small craft harbours. I'm led to believe that there are some concerns with budget manipulation. I use that word perhaps intentionally, because I believe that's what's happening. There is a set formula--from what I understand, in fact we've been privy to it for a number of years--in relation to allocating money to the different regions through small craft harbours for capital and other expenses.

For the Newfoundland region, for instance, historically--and when I say historically it might be fewer rather than a larger number of years--in the recent past, since the agreed-upon formula, there's about 28.4% of the amount. Last year there were some changes to that, and I understand that with extra pressure from Quebec the budget was changed somewhat so that our percentage ended up to be more like 27.4%. It doesn't sound like a major change, but it's $600,000, and that does a lot of good in a small province.

I've been told that this year the minister, being from Atlantic Canada and realizing that Atlantic Canada, not only Newfoundland and Labrador but the other three provinces, had been shortchanged last year to put perhaps an uneven amount into Quebec, refused to accept the recommended change or the cut, and we went back to our standard 28.4%. Now I'm being told that the pressure is on internally to change that again so that last year's special provisions for Quebec are implemented again this year. If that is the case, Atlantic Canada, and particularly Newfoundland and Labrador, where we get 35% of the overall budget, will be shortchanged again.

I'd be very interested in hearing from Mr. Da Pont what is happening. What is the historic amount? What happened last year, and why is there--and I'm aware of this because we have members from Newfoundland on the committee--pressure to provide extra funding for Quebec to the detriment of the other provinces, particularly Atlantic Canada?

Á (1105)

The Chair: Mr. Da Pont.

Mr. George Da Pont (Assistant Deputy Minister, Human Resources Corporate Services, Department of Fisheries and Oceans): Thank you very much, Mr. Chairman.

Yes, there is, as the honourable member has indicated, a set formula for dividing funds among regions of the country. About a quarter of that division is based on a number of numerical calculations, such as the number of harbours, the number of core harbours, the number of harbour authorities. About a quarter of the allocation is based on the percentage of the commercial fishing fleet in that particular region, and about half of the allocation is determined by the overall replacement value of the facilities that are in each region. So that is essentially the formula that's used to divide up funding on a regular basis among the various regions.

Many of the harbour authorities have complained for some time that the formula is too simplistic and does not take into account actual needs, that it's too formula-driven and that needs vary from year to year and obviously from region to region. One of the biggest drawbacks of the formula as it stands is it doesn't take into account some of the dredging and re-dredging costs, which can be quite significant. There were some major requirements in that area for Quebec, in particular, at the beginning of the last fiscal year, so some adjustments were made to the division of money among the regions on an ad hoc basis to cover off the dredging requirements. I might add, there are also significant dredging requirements in the maritime provinces on a regular basis, as well.

This year we have not yet finalized the formula division among the various regions of the country. We are using the existing formula--the one I've referred to--but we also are looking at what options we might have to address, again, some of the dredging requirements, and we hope to settle the actual division among the regions within the next couple of weeks.

Á (1110)

Mr. Loyola Hearn: Mr. Chair, coming back to it, he has admitted that there was a formula. It's the formula on which the regions have been allocated money. We are aware that last year Quebec received a special provision. I guess the excuse, for want of a better word, was extra dredging needs.

Mr. Da Pont has stated--and I'm sure he knows full well--that other provinces have dredging needs. A number of harbours in my own area, and I'm sure in Mr. Matthews' area, have dredging needs. Not only that, we also have specific needs that other provinces don't have because of severe storm and ice damage. I would think the special needs in the Atlantic provinces would be as great as or greater than those of Quebec. Consequently, I don't buy that special provisions should be made because they have special dredging needs.

I'm pleased to hear that this year the formula is based on the original formula, 28.4%. However, I again take no consolation from his hesitation in saying they are looking at specific needs, especially dredging, because I know there is pressure from Quebec to go back to last year's special needs. That will take money from Cape Breton, Burin, and Burgeo--from all our regions--and put it into Quebec.

I remind all of you that in Newfoundland and Labrador we have eight times as many vessels--whether it be in number or in length--as in Quebec. Certainly the geography suggests the need for wharves and harbours is greater than in that province generally, except for specific regions. So I don't mind equality, but I don't at all agree with special concerns and special provisions, especially when you're robbing Peter to pay Paul--particularly when we're Peter. You are also robbing Peter in this case.

So I am really concerned. We know what's going on, and I know you're not in the position to be able to say there is internal pressure and manipulation, but that is what's going on. There is a set formula, and I think the department has to be strong enough to stand by the minister and say “Yes, we have to stick to the old formula because each region has its own specific needs. Once we start playing with that we're going to blow the whole lid right off.”

I'm not sure whether that was the question or not.

The Chair: Let's ask a couple of questions from that.

Is there pressure or was there pressure to adjust the normal formula in favour of Quebec?

Mr. George Da Pont: The harbour authorities in Quebec have come forward again with their specific needs, in terms of dredging requirements, so we are looking at that to see what options we have to deal with it. But as I said, no final decisions have been made yet.

The Chair: But I presume other commissioners or harbour masters--or whatever phrase you use--are also coming forward. It's not just the Quebec ones.

Mr. George Da Pont: Exactly. We have some from the central and Arctic regions who also have some similar issues.

The Chair: Is there nobody from Newfoundland and Labrador?

Mr. George Da Pont: Not that I'm aware of, Mr. Chairman.

The Chair: Gentlemen, maybe you should speak to somebody.

Mr. Loyola Hearn: This is above and beyond.... This is a way of getting what you shouldn't get.

The Chair: Okay. You're out of time, Mr. Hearn.

Mr. Loyola Hearn: Regular requests are in.

The Chair: Thank you.

Mr. Matthews.

Mr. Bill Matthews (Burin—St. George's, Lib.): Thank you, Mr. Chairman. I apologize for being a bit late.

Welcome to the officials. I'm sorry I missed some of Mr. Hearn's probing, so I don't know if you're strictly on the formula of 24.8%, or whatever.

Mr. Loyola Hearn: It's 28.4%.

Mr. Bill Matthews: I just want to follow up on small craft harbours with Mr. Da Pont, particularly.

We all know that the coast guard took some capital money and spent it on O and M last year, or whatever you call it. But there was a shifting of money inside the department. Now I understand Treasury Board wants an accounting, or you have to repay or correct the shifting of last year.

Is that in any way going to influence new start-up projects for small craft harbours? I have one in my riding that's been trying to get started for 25 years. We have it to the stage now where we're encouraged this year.

I'm just wondering, with this internal shifting of money inside the department, if new start-up capital projects for small craft harbours will be delayed, postponed, or taken off the table. Can you answer that for me?

Á (1115)

Mr. George Da Pont: They certainly will be affected, but the situation is that this past fiscal year some money was transferred from one of the coast guard's capital budgets into small craft harbours. The reason for that is the money would otherwise have been lapsed, as I explained last year. So what we did this past year with that extra money is we were able actually to accelerate some projects that otherwise would have had to wait.

We are required, however, to pay back the coast guard in terms of the money that came from that envelope. That would be around $1 million, I believe. In fact we got extra money last year, accelerated things last year that otherwise would have had to wait.

Mr. Bill Matthews: You're really telling me then that new start-up projects this year quite possibly will be delayed because of the internal shifting of money inside of DFO last year.

Mr. George Da Pont: There might well be some impact, but I think what I'm saying is with the extra money last year we actually accelerated some things using the extra money.

Mr. Bill Matthews: Where did you accelerate it? What region?

Mr. George Da Pont: I believe the money was spread over a variety of projects. I'd have to check on which specific projects were accelerated with the extra money.

Mr. Bill Matthews: Thank you, Mr. Chair.

The Chair: Mr. Cuzner, would you like to go now? There's lots of time left in the ten minutes.

Mr. Rodger Cuzner (Bras d'Or—Cape Breton, Lib.): On the moneys allocated for small craft harbours, in the wake of Hurricane Juan and the stresses that were put on some of the allocations for Hurricane Juan, is there a contingency to address the result of the devastation along that whole coast? Or would money have to have been reprofiled from the regional budget to address that? Are there harbours that would have missed out because of the impact of Hurricane Juan?

Mr. George Da Pont: No. Actually there aren't harbours that would have missed out because of the impact. We do have a bit of a capital reserve that we keep in general in the department, so last year we were able to spend $1.6 million for emergency repairs to harbours that were damaged by Hurricane Juan. That was over and above the regular small craft harbour budget. That was in addition to it, so we did not have to adjust planned projects to absorb the money in any way.

For some harbours there will be additional work required, because what we spent was essentially for the emergency and immediate repairs. For those, we're looking at integrating that into our planning cycle.

Mr. Rodger Cuzner: Staying with harbours, I'm sure everybody, certainly on the east coast, is in a situation where they have harbours in their constituency that have been divested. Harbour authorities have been set up and continue to operate, but five years into a divestiture--and these are still viable ports that are very productive and generate a great deal of revenue--they're just at the point now where they could really use some type of assistance and an investment, whether it be dredging or whatever. Is there any potential at all within the current program structure to identify some of the needs of these divested harbours?

Mr. George Da Pont: Unfortunately, I don't think there is any potential for that in the current program structure, because as I'm sure the committee is well aware, we are stretched to actually deal adequately with the harbours that are now in the inventory.

As I indicated in response, I think, to a question the last time I was here, we are looking at options around perhaps some restructuring of the program that would accommodate that issue, that would accommodate about 34 active fishing commercial harbours in various parts of the country that are not part of DFO, and therefore don't qualify, and that would accommodate some of the requirements that the Nunavut government has put forward in terms of desire for small craft harbour facilities. We're at a very early stage on that, but I think it would be very difficult for us to accommodate those needs within the current budgetary framework of the program. So that would have to be addressed as part of any potential restructuring.

Á (1120)

Mr. Rodger Cuzner: If I can put one question to Commissioner Adams, as well, it's just with regard to the situation at the Coast Guard College, where there probably won't be a college this coming year. The college in Point Edward will not receive cadets this coming year. Is that based on or a reflection of industry needs, or is it budgetary in nature? Could you just make a comment on where we're going? Should we be concerned in Cape Breton as to future of the Coast Guard College?

Commissioner John Adams (Canadian Coast Guard, Department of Fisheries and Oceans): No, frankly, there is no intent at this stage to do anything untoward with the Coast Guard College.

The reduction this year is basically for two reasons. It's based on need—the coast guard's need, not industry's need. We just didn't need additional graduates coming out four years hence.

Point two is that we're also looking to make absolutely certain that what we're doing at the college is the most cost-effective approach possible with respect to the training and education of the cadets, who will eventually become coast guard officers. The year will give us a year to do just that.

Let me assure the committee that there is a worldwide shortage of mariners, particularly officers of the quality that we produce at the Coast Guard College. The last thing we would want to do is have to try to compete in that worldwide shortage situation. So we're quite content with what we're doing at the Coast Guard College, but we're just going to use a year to confirm that we're doing it in the most cost-effective way, and then we'll pick up entrants in subsequent years. The college will continue to function, obviously. It's a four-year program, and there are three other full years there.

No, I don't think you need to be concerned about the Coast Guard College as an institution.

The Chair: We have one minute left.

If I may just bootleg a question, I received a letter from the Sportfishing Defence Alliance. I'm not sure if any of you three will be able to answer this, but maybe Dr. Watson-Wright might give it a crack. The letter to the minister says this:

Our members are reporting that the illegal drift gillnet fishery has once again started in the Fraser River upstream of the Agazi-Rosedale Bridge.

...

Minister, your scientific and management staff have refused to allow a recreational fishery in this area due to what they term as the presence of “stocks of concern”. In fact there have been repeated scientific reports and clear indications in your Integrated Salmon Management Plans that “exploitation rates on these stocks must be reduced”. Frankly, a seven day a week, twenty four hour a day gillnet fishery is not “reducing” the exploitation rate.

This is the fifth year in a row that this illegal, continuous and high impact illegal fishery has been allowed to go on unchecked by your Department. Not only that but it is the fifth year that such fisheries have gone on unchallenged during the migration period of stocks of high concern or “endangered” stocks.

The letter's longer, but that's enough.

Are those statements accurate? If they are, what's the department doing? If they aren't, what is inaccurate about them?

Á (1125)

Dr. Wendy Watson-Wright (Assistant Deputy Minister, Science, Department of Fisheries and Oceans): Mr. Chair, unfortunately, I can't comment on the veracity of the statements, but clearly we will be seeing that letter if it has gone to the minister.

The Chair: Okay.

Dr. Wendy Watson-Wright: But I'm not able to comment on that.

The Chair: If you don't mind, I'd like someone to get back to us on that at some point, particularly if there is an ongoing illegal gillnet fishery operating 24 hours a day—and apparently right under the noses of the enforcement staff of DFO, who appear to be doing nothing about it. So I'd appreciate it if we'd get some response to that.

Dr. Wendy Watson-Wright: I will pass that on to Mr. Bevan.

The Chair: Thank you very much.

We are now going to Mr. Stoffer.

Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP): Thank you, Mr. Chairman.

And thanks, once again, for appearing, folks.

Madam Watson-Wright, my first question is for you. There was seismic testing done off the coast of Cape Breton late last year, just off the coast at Chéticamp, and there was concern about crab stocks and crab larvae. The ship that did the testing had DFO officers on board, who took all that information for analysis. Would your department receive that analysis?

Dr. Wendy Watson-Wright: Yes, our department would receive that. That's part of ongoing studies within the department.

Mr. Peter Stoffer: All right. Now, I understand that the decision to allow seismic testing in those waters is done through a board called the Canada-Nova Scotia Offshore Petroleum Board--

Dr. Wendy Watson-Wright: That's correct.

Mr. Peter Stoffer: --even though the minister has the ultimate say in protection of fish and fish habitat according to the Constitution. So I've always tried to figure out how the department can allow another agency, although combined, to make those decisions for the department when there was a tremendous amount of angst against that seismic testing going on.

My information--and I'll stand corrected if need be--is that scientific information regarding the crab larvae has still not been revealed or has still not been dissected enough to make a decision of some kind. Is that correct?

Dr. Wendy Watson-Wright: That's correct.

Mr. Peter Stoffer: Okay, then how can seismic testing be allowed off the other coast of Cape Breton when the information is still inconclusive that it may--and I say “may”--do damage to those fragile ecosystems and that stock? I guess in a roundabout way what I'm trying to ask is how the department can allow an activity to be permitted when scientific information is not completely analysed yet in order to protect those stocks. Because I do remind you, the reason you're here is the protection of fish and fish habitat.

Dr. Wendy Watson-Wright: I would say that according to the state of the knowledge worldwide, there is no evidence to say that the seismic activity will harm the larvae, nor is there information to say that it won't harm the larvae--hence, it's why we're undertaking the work. In this case, given that paucity of knowledge, but given all the knowledge that we have put together, we can't say for certain that, yes, this is harmful. That's why we are undertaking the experiments.

The results of these experiments, as I indicated at the last meeting, will be ready in the fall. We are continuing with the experimentation. In addition, as I also indicated previously, we are putting together reports on the state of the knowledge worldwide.

So there are varying opinions. The scientific evidence doesn't support one view or the other at this particular point.

Mr. Peter Stoffer: Correct me if I'm wrong, but doesn't the department operate on the precautionary principle?

Dr. Wendy Watson-Wright: Yes, the department operates on the precautionary principle.

Mr. Peter Stoffer: Isn't it advisable, then, to wait until you get that information analysed before you allow another activity to proceed? The oil and gas isn't going to go anywhere. If it's there it will be found eventually.

Again, I stress the importance of maintaining the livelihood of fishermen in those coastal communities and protecting their resource. If you operate on the precautionary principle, it means that you don't proceed unless you have the best available science. Even then it will be a best educated guess, obviously, but at least you'll have some information. If you don't have all the information, again, I hate to harp on this, how can you allow an activity to proceed?

Dr. Wendy Watson-Wright: On the precautionary principle, yes, you're correct in what you're stating, although, of course, socio-economic and cultural benefits are always taken into account when decisions are made.

In terms of who made the actual decision on whether to go ahead, you're right, it was the Canada-Nova Scotia Offshore Petroleum Board. How that particular decision came about as to which board would make the decision, unfortunately I'm not able to answer that at this point.

Á (1130)

Mr. Peter Stoffer: Okay, fair enough.

I am switching over to the west coast now.

When the aquaculture report came out by Mr. Bastien, there were concerns by a lot of the groups that a fair number of habitat officers were soon to be released from their jobs. Was that correct? Is there a reduction of DFO officers on the west coast being planned?

Dr. Wendy Watson-Wright: I would defer that to Mr. Da Pont.

Mr. George Da Pont: No, I'm not aware that there's any plan to lay off any particular individuals on the west coast or in any other part of the department.

We have put in place a plan for this year to try to get about a $21 million saving in our salary costs. About 40% of that saving would be, if we're able to achieve it, based on hiring fewer casuals, terms, and students than we normally do. So it would be hiring fewer people.

For the rest, we are looking to try to target, if we can get a reduction across the department, about 100 positions, if possible, that become vacant through attrition. The sorts of parameters that we have in place for that are to try to ensure that there is no impact on field operations. So the vast majority of positions that would be targeted in that area would be administrative-oriented positions at national headquarters and at regional headquarters. In addition, we have put in place a plan to reduce our EX complement by about 10%, which would be about 25 EX positions.

So that's the only scenario we have in place. There are no plans to lay off people.

Mr. Peter Stoffer: If there were plans, you'd know about it, right?

Mr. George Da Pont: I think I would.

Mr. Peter Stoffer: Very good. Thank you.

Mr. Adams, I have a question for you in terms of lighthouses on the west coast. The Auditor General had questions as to the current manning of light stations. Is it the department's position to keep those stations manned, or are you going to move towards the technology that was invoked in terms of Nova Scotia, where there are no manned light stations any more, and in Newfoundland, and there's one in New Brunswick, I believe? On the west coast there's a grave concern over some of these stations. Is it the department's intention to eventually automate all those light stations, or are you going to maintain the status quo for now?

Commr John Adams: We will maintain the status quo for now, by direction. There is no operational requirement, in our opinion, to have manned light stations on either coast.

Mr. Peter Stoffer: Sorry, can you just repeat that one more time, please?

Commr John Adams: From a coast guard point of view, there is no operational requirement to have staffed light stations on either coast.

Mr. Peter Stoffer: But your department has been given direction to keep them manned at this time.

Commr John Adams: That was a cabinet decision. Of course, we've received supplemental funding to do that.

Mr. Peter Stoffer: Was that supplemental funding for several years?

Commr John Adams: Yes, indefinitely.

Mr. Peter Stoffer: I see.

The Chair: Just on that point, there was a report that was supposed to be done on reviewing the future of light stations. It was supposed to be available in December 2003. Is that report done?

Commr John Adams: No. What we've done is we've rolled that report into a larger report on marine aids in general. We're hoping to have that done by the fall.

The Chair: By the fall of this year, 2004.

Commr John Adams: Yes, correct.

The Chair: Mr. Stoffer.

Mr. Peter Stoffer: I want to follow up on Roger's question on the Coast Guard College. When we were on the west coast doing the MCTS report, we heard from many people in the field that they're really short personnel, that they really need more bodies.

Commr John Adams: Correct.

Mr. Peter Stoffer: From my understanding, these bodies are trained at the Coast Guard College. Is that correct?

Commr John Adams: That's correct.

Mr. Peter Stoffer: The delay of training that you had mentioned for other officers, will this affect MCTS operations?

Commr John Adams: No, it's purely for the officer cadet training program, the OCTP.

Mr. Peter Stoffer: So there are, for example, trainees going through the process now.

Commr John Adams: We will continue to do ab initio training for MCTSOs, yes, to continue to meet the bill that you, this committee, actually identified as being required to complete the staffing in some of our key sites, yes.

Mr. Peter Stoffer: If I may ask, sir, how many would be going through the process right now in terms of training, approximately?

Commr John Adams: Right at this moment?

Mr. Peter Stoffer: Yes.

Commr John Adams: What we try to do is between 20 and 30 a year, approximately. How many are actually there now, I can't say, but we try to do between 20 and 30 a year. We target, obviously, the high-priority demands and then work from there.

Á (1135)

Mr. Peter Stoffer: My last question on MCTS is--

The Chair: Your last question.

Mr. Peter Stoffer: Nasty. That's why he's the chairperson.

There was talk in Nova Scotia when we were there last time about the possible amalgamation of some of those centres into one. We also heard those discussions in Newfoundland and Labrador, as well. As we speak, for the next year or two, is there any thought process within DFO or the coast guard to merge those offices, similar to what the government did with Environment Canada?

Commr John Adams: No. As the minister opined at least six weeks ago, that will not happen.

Mr. Peter Stoffer: Thank you.

The Chair: Thank you.

Questions from the CPC. If not, I have questions.

Mr. Burton, go right ahead.

Mr. Andy Burton (Skeena, CPC): Thank you, Mr. Chairman. Actually, I did have a couple of questions prepared, but the discussion has tweaked some other thoughts, so I appreciate the opportunity.

I have a comment on Mr. Stoffer's reference to the precautionary principle. The idea or the concept is to prevent harm, but not to prevent progress. I think that's what we have to balance here, somehow. If you don't do a certain amount of this work, wherever it may be, I don't know how you're going to determine if there's harm or not. There's a balance there. So I'd just like to make that comment, Mr. Chairman.

With regard to the small craft harbours, perhaps you could refresh my memory or perhaps bring me up to speed on the position in B.C., the terms of the percentage overall, the split around Canada on the coasts--presumably on the coasts; I don't think there are many in Saskatchewan, or I hope not. You never know, with DFO.

Anyway, perhaps you could tell me what the split is of the overall budget, and then what percentage of that is B.C.'s in terms of dollars.

Mr. George Da Pont: I do have the information with me. I'll just take a minute to find the relevant section. I had thought I had brought the regional breakdown of the small craft harbour budget, but I'm afraid I didn't.

Mr. Andy Burton: Off the top of your head, can you just give me a rough--

Mr. George Da Pont: I don't know if one of my colleagues--

Mr. Andy Burton: Just give me a rough estimate. Is it 30%...?

Commr John Adams: I think we have something coming.

Mr. George Da Pont: The figures I have here are just in raw numbers. Keep in mind that we haven't completely finalized them. The distribution is as follows: Pacific region about $8.7 million; central and Arctic about $3.5 million; Quebec about $5.6 million; the Maritimes and gulf about $26.7 million; Newfoundland about $7.7 million; and there is a bit of headquarters cost that are mostly things that are paid centrally, like insurance and so forth, which is about $3.2 million.

The Chair: I want to thank you for that information, raw as those numbers may be. You will remember that one of the frustrations we had with the estimates process last year was that when we were asking questions on a regional basis we simply couldn't get an answer, raw or otherwise. So we certainly appreciate the fact that somebody over there had some documentation and some numbers. If those numbers change in any way, please advise us.

Mr. Burton.

Mr. Andy Burton: Thank you for that. It gives me a little bit of an idea. It looks to me like B.C. might be getting a little shortchanged here. But I'm not sure how many small craft harbours are actually active on the west coast. I don't suppose you have that information.

Mr. George Da Pont: Yes, that I do have.

A voice: [Inaudible--Editor]

Mr. Andy Burton: That's true. There are different situations. I'm just curious as to....

Mr. George Da Pont: I'll give you the number of harbours by region. In the Pacific region there are 138 fishing harbours. There are actually three in Alberta, 10 in Saskatchewan, 39 in Manitoba, 13 in Ontario, 85 in Quebec, 377 in Newfoundland, 59 in Prince Edward Island, 199 in Nova Scotia, 84 in New Brunswick, and we also have three in the Northwest Territories.

Á (1140)

Mr. Andy Burton: What was the budget again for the Arctic coast?

Mr. George Da Pont: The central and Arctic region?

Mr. Andy Burton: Yes. Was it $3.5 million?

Mr. George Da Pont: Yes, $3.5 million.

Mr. Andy Burton: That's fine. Thank you. I'm trying to do some comparisons in terms of distribution of dollars. It seems reasonable. Thank you for that information.

On the issue of not necessarily cutbacks but perhaps cost controls you're looking at putting in place in terms of staffing, with regard to aquaculture site applications, they're taking an awfully long time, especially on the west coast--upwards of two years at times. For the Confederation Bridge, I believe going through the CEAA process and the whole application process took about 18 months. When you compare those, it seems like a very lengthy amount of time. I'm concerned that possible cuts in staffing or dealing with these issues could adversely affect this timeframe even more seriously in terms of getting some of these applications through.

I'm sure you're aware that there's a huge backlog in site applications on the west coast due primarily to there being a moratorium on new sites. Then when the moratorium was lifted, there were immediately a number of applications, many tens of dozens. The timeframe is totally inappropriate. How are we going to address that? Is it more staffing? Is it more money? What's the solution there?

Mr. George Da Pont: I can't get into the specific issue you raised in terms of habitat. Obviously one of my colleagues, Sue Kirby would have to address the specifics. But what I can say that's relevant to the question is I mentioned that we're looking to get salary savings of about $21 million. In addition to that, we've looked at a variety of administrative cuts in areas like IT, travel, a variety of those sorts of things, for another $40 million. The intent there is to have some money to reinvest in some of the more pressing priorities. That is the reason why we're dealing with trying to free up some money from administrative things to have more operating money in areas of priority.

Mr. Andy Burton: I certainly don't disagree with that. I think I made the comment in the past that we need more people on the water rather than in the ivory tower. So that's certainly encouraging, and I look forward to dealing with some of these issues in a more expeditious manner.

Perhaps I could ask another quick question, Mr. Chairman, to Mr. Adams, regarding the implementation of the automatic identification system on vessels.

I think by the end of this year all ocean-going ships over a certain size will have to have AIS. I believe there's funding that has been at least put in the estimates for the coast guard getting the appropriate equipment to deal with this automatic identification system. I wonder if either you or Mr. Da Pont could perhaps clarify what kind of funding the coast guard is getting this year to implement this new equipment to deal with AIS and actually how much will be spent this year by the coast guard for this system.

Commr John Adams: Thank you, Mr. Chair.

There are two aspects to AIS. First of all, there are the transponders for the vessels, and in fact that is the vessel owners' responsibility; and then there's the shore-based infrastructure to receive the information from the ships and distribute it throughout the security agencies.

The part we're working on is the shore-based infrastructure. We received approval in principle last year to expend this year $1.5 million to do the test-bed sites, one in each of the regions, to ensure that we could iron out how these ground-based stations were going to work. A decision has been made that we will integrate that requirement into the MCTS sites as required throughout the country.

This year we are going back and we're hopeful that we'll get Treasury Board approval for our submission as early as May 3 for the remaining $27.5 million in order to complete the installation of those sites across the country.

I'm not positive of the cash phasing. I doubt, George, that you have it.

Á (1145)

Mr. George Da Pont: No, I don't.

Commr John Adams: I think it's about $5 million a year, in rough order of magnitude, in order to attain the operational due date, which is 2008. So that's new money.

Mr. Andy Burton: Thank you.

The Chair: Before we go to another questioner, just to be clear on this, our information is that there was a government press release issued on January 22, 2003, saying that $37.5 million would be allocated for the implementation of AIS. You testified later that the government would provide up to $27.5 million over the next five years for the implementation of the AIS. Then there was a DFO news release of March 5, 2004, that confirmed the figure of $27 million as part of a $172.5 million five-year package to enhance the security of Canada's marine transportation system.

Commr John Adams: Correct.

The Chair: There appear to be no authorizations identified in the main or supplementary estimates A for this purpose for 2003-04. Is that correct?

Mr. George Da Pont: Yes, that's because, as the commissioner has just indicated, it's before Treasury Board for approval. Therefore, assuming approval by Treasury Board, it would appear in supplementary estimates later this year.

The Chair: All right. Is it $37.5 million, or $27.5 million?

Commr John Adams: It's $27.5 million, Mr. Chair.

The Chair: What happened to the other $10 million?

Commr John Adams: I can only assume it was an estimate at that time; we've since refined it, and it's $27.5 million. Or it's possible--and I don't know the press release you're referring to--that this was an all-inclusive number, because there was funding set aside for additional security-related expenditures, and I don't know if that was included in the $37.5 million or not. But the AIS number is $27.5 million.

The Chair: Thank you very much.

Anyone on the Liberal side? Mr. Steckle.

Mr. Paul Steckle (Huron—Bruce, Lib.): I want to take my line of questioning firstly to the central region. The Great Lakes, of course, have had a different problem from the coastal areas east and west because of the fact that we have had low water levels, and this has necessitated dredging, of course. Is the pressure pretty much off you people in terms of money demand, given that some of this dredging has been done, or is there still a backlog of money sought but not yet received?

Commr John Adams: Fortuitously, the pressure for dredging has been relieved because of increased water levels, but that program had a drop-dead date. It was a two-year program, and it is now concluded. But I think we have satisfied the demands--not that it won't change if in fact we have a low water level this year.

That was a very special project the government agreed we would get on with, and we had to find that money from within, which was less than happiness for us, but we did get on with it.

I can't recall. I think we were asked to set aside $15 million, and I must admit--and George, I don't know if you recall--it did not amount to that. We in fact spent less than that to meet the urgent demands, and now the pressure has been relieved with water levels going up.

Mr. Paul Steckle: Yes, it's something that we of course ultimately trusted. Thinking of its cyclic history, we expect that it will come back again.

What is the relationship between Canada and the U.S., given our close proximity to the Americans in the lower portion of Ontario, Lake Huron, and those areas, in terms of our reciprocal arrangement with the coast guard on ice-breaking and that type of thing? Do we work back and forth? Is there a reciprocal arrangement where we help each other?

Commr John Adams: Yes, there certainly is. There's a memorandum of understanding between the two coast guards.

We in fact treat the Great Lakes as a single body of water and we work on it together, to the extent that during the winter we actually have U.S. Coast Guard officers in the regional operations centre in Sarnia to coordinate ice demands. It's an exchange program. During the winter, whichever country is the closest will respond to the ice-breaking demands.

Á (1150)

Mr. Paul Steckle: That is working well...?

Commr John Adams: It's been working extremely well. Of course, one year to the next, it will vary. If you have a bad ice year, the commercial sector will never be satisfied that it's perfect. But yes, it works very well.

Mr. Paul Steckle: That's good.

In looking at some of the background I have here on some of the future spending on fleet replacement, given that capitalization of the fleet is a very costly expenditure, I'm wondering how we're going to meet those targeted replacements. Obviously, there comes a time.... We talk about rusted-out ships, and rusted-out ships don't float very well, and you have to replace them some time. What is your plan? The numbers that I see don't reflect the kind of need that's there. How are you anticipating doing that?

Commr John Adams: Let's just talk about the numbers that are there now versus the perceived requirement from our perspective.

The numbers that are there now did get a shot in the arm two years ago, when the government did announce an additional $47.5 million a year—not strictly for fleet, but for capital asset improvements. That brought our total available capital within the coast guard to in the order of $100 million a year. That's still not enough, you're absolutely right, but at least it was a shot in the arm.

The one limitation on the additional $47.5 million was that we could not buy new vessels. We could not replace existing vessels, but we could simply improve existing vessels.

I have to be careful here, because this is very much a ministerial prerogative, but what we will be recommending to our minister is a memorandum to cabinet seeking the additional major capital required to replace our big ships on a progressive basis.

The third point that's worth emphasizing is that the government did take the decision in 1998-99 to replace the small lifeboat fleet; $115.5 million was appropriated to complete that effort, over and above some other moneys that were appropriated to us. So the small boat fleet will be in very good shape within four to five years, once we complete the build of those small boats.

It's the large vessels, of which we have 41 in inventory right now.... We've had to do a couple of things. First of all, we had to prove to the centre that we were expending our moneys in the most cost-effective way possible. I think I've testified to the committee in the past about the departmental assessment program, which was then folded into the departmental assessment and allocation program. That work was done to satisfy ourselves and the centre that we were using the money we were getting in the most cost-effective way possible.

The second thing that had to be done is that we had to confirm our essential long-term requirement. We think we've done that now, working closely with the science and fisheries management sectors, which are two of the principal partners that we have by way of fleet support over and above the coast guard programs. We think we've done that now.

So we're ready now, with that information, to put the memorandum to cabinet, together, we hope, for consideration in the next federal budget. That's obviously subject to fiscal realities and election results, etc. But that's where we are.

By the way, the confirmation of those hard requirements has reduced the number of big ship vessels that we think we will need in the out years. In some cases, I've managed to combine requirements by multi-tasking vessels.

We're convinced that we have a story now that will receive the support of the centre, and we're looking for additional moneys out to 2020. It's a 2020 plan. We hope it starts in 2004-2005 or 2005-2006, depending upon what the government's fiscal situation is, and it runs to 2020. We're looking for the first five-year tranche immediately, and then we'll obviously come back for subsequent tranches in later years.

Mr. Paul Steckle: I don't know what time I have left, but just briefly....

The Chair: I'm being very flexible.

Mr. Paul Steckle: You're being very flexible. I appreciate that. You're very liberal today.

We're a long way from the east coast, but I think all of us are interested in this. The Irving Whale cost a lot of money to bring to the surface. It was about $42 million, I understand. Who paid for that, ultimately? What did the Irving family pay toward that? What did we get out of it? There was some fuel oil on that ship, I understand. What was the net balance to the government on that issue?

Commr John Adams: I'm sorry, I'll have to get back to you. I just can't give you the specifics. I know there was cost sharing associated with it, but I must confess that I don't know the answer to that.

Á (1155)

Mr. Paul Steckle: I would be abdicating my responsibility to the central region if I didn't say one more time, speaking to Mr. Da Pont on the science side, don't spend it all on capital fleet. Leave $1.9 million more for sea lamprey.

The Chair: Mr. Commissioner, just so that we're clear about what Mr. Steckle was asking, we'd like answers to two questions, if you can, and if not, why not?

What were the conditions of the settlement of the costs in the case of the recovery of the Irving Whale, and what were the direct costs, if any, borne by the coast guard and DFO in general? That's on that issue.

To go back to the other issue he raised about fleet management, the 2003 budget announced an injection of $94.6 million over two years, and $42.3 million of that was used, apparently, leaving $52.3 million of that announcement. Is the $52.3 million part of the $82 million forecast for fleet management for 2004-05?

Commr John Adams: Yes.

The Chair: So that would in effect mean that base funding for fleet management has decreased.

Commr John Adams: No. It will next year.

The Chair: Because you also got an injection. You had $93.1 million for capital expenditures for 2003-04, and the main estimates forecast $82 million, which is a difference of $11 million. How do we explain that?

Commr John Adams: George, can you help me there?

I can explain it. To give you an example, as we discussed--I think the last time we were before you--occasionally we're not able to spend our moneys. You can apply to carry forward that money. That will distort your numbers from year to year.

For example, we were forecasting an expenditure in the rough order of magnitude of $13 million on a hovercraft for Quebec this year. We could not spend that money, basically for procurement reasons. The company couldn't produce the hovercraft. So what we did is carry it forward. That money will go into subsequent years, so you will get “puts” and “takes”.

There is no decrease in our capital expenditure for fleet for next year. There will be in subsequent years, but not for next year.

We'll have to explain those numbers to you if they don't make sense to you.

The Chair: Thank you very much.

Mr. Stoffer.

Mr. Peter Stoffer: Madam Watson-Wright, we did a report on ballast water and endangered species. Is Canada meeting its current obligations internationally in terms of working with other countries on ballast exchange water?

The reason I ask is that Dr. Paul Brodie, who you are aware of, has been working on some sort of system on ballast water with the Kent Line, the Irvings. It's a system where you actually radiate or heat the water, if I'm not mistaken.

What is the government doing right now in terms of ballast water?

Dr. Wendy Watson-Wright: In terms of whether we're meeting our international obligations on ballast water, I would have to ask Transport Canada. I can certainly do that.

Mr. Peter Stoffer: Okay.

Dr. Wendy Watson-Wright: In terms of Dr. Brodie's work, you asked me at the end of the last meeting about that. I have responded to you, but I don't think it's reached you yet. In fact, the response we sent last June did look at the work of Dr. Brodie. He's looking at something like ozonation and ultraviolet radiation. Our scientists did look at that, and there was a response sent back to you. It is in the mail as we speak.

Mr. Peter Stoffer: Thank you.

Mr. Adams, if you're going to recommend to the minister that there be a major capital investment, we'd be happy to give you a letter of support.

Commr John Adams: You've already given me support in the report, and I thank you for that.

The Chair: Absolutely.

Mr. Peter Stoffer: And again, Madam Watson-Wright, in terms of seals, there's been a lot of media print now about grey seals off Sable Island. I think the numbers could be up to 300,000. A lot of people are asking that up to 10,000, I think, be taken. There are markets for them, and they would like to move on that.

Would your department be the one to recommend to the minister that a take of 10,000 grey seals would be acceptable, or would there be even more? Would you recommend that?

Â (1200)

Dr. Wendy Watson-Wright: There are two questions.

The Chair: Exactly. Is it your department that recommends to the minister that there be a cull?

Dr. Wendy Watson-Wright: Yes, it would be.

Mr. Peter Stoffer: Not a cull.

The Chair: Oh, sorry, that there be a take.

Mr. Peter Stoffer: A harvest.

Dr. Wendy Watson-Wright: It would be our department that makes that recommendation. The recommendation would be based upon the scientific work that we produced and would be made by the fisheries management sector.

Mr. Peter Stoffer: Okay.

Dr. Wendy Watson-Wright: In terms of whether we would recommend that, the seal assessment...we do have a seal research project ongoing. It's about to reach its one-year anniversary. We have done the seal component of the grey seal survey in the gulf and on Sable Island. We are just about finishing the harp seal survey at this point, and next year we'll be looking at hooded seals. As to what the number or the advice would be, I do not have that at this point.

Mr. Peter Stoffer: Okay.

Mr. Adams, I think it was last year that some aspects of the coast guard were moved over to Transport Canada. Would the recommendation for that type of move be from you to the minister, or would it be from the minister level down to you in order to make this happen? How does that sort of transfer of responsibility work?

Commr John Adams: That is a machinery decision, and the decision is taken by the Prime Minister's Office.

Mr. Peter Stoffer: A machinery decision?

Commr John Adams: Yes.

On December 12, with the change in prime ministerial responsibilities, they came down with what is called an order in council--I'm sure you're aware of that--and decided that decision was being recommended. They did ask us at that point if it made sense, and our response was yes, from three points of view. Certainly from Transport Canada's point of view, because it puts all of the transportation policies writ large--including, obviously, maritime policy, which is our concern--in one place. So from their point of view that was good. From our point of view it was as well, because it was split between the two. So it's good for them, good for us. Plus it was good, in our opinion, and frankly in the opinion of the client out there, the Canadian out there, that they could go to one place for policy issues, as opposed to two.

So our recommendation was that, yes, it made good sense. But the initiative actually came from the centre.

Mr. Peter Stoffer: Okay. And you used the word “machine”.

Commr John Adams: It's a “machinery of government” change.

Mr. Peter Stoffer: I haven't heard that before.

Commr John Adams: You haven't?

Mr. Peter Stoffer: I remember a movie years ago called Midnight Express, when he was walking counter-clockwise to the circle and a guy came up to him and said “You're a bad machine; you've got to be a good machine.” So I'm kind of questioning whether that was a good machine or a bad machine.

But the decision was good. So with that decision of a little bit going over, why not move it all over, into a stand-alone agency? Because that's what.... You've probably had a look at our report, though not enough to qualify a proper response, obviously.

Commr John Adams: Not yet.

Mr. Peter Stoffer: But if we've moved part of it over, let's move it all over. The reason I say that is that there are a tremendous number of people out there who are really excited about our report and saying yes, finally someone is listening. This is where the department should be, not within DFO.

So would that recommendation come from someone like you? You could appear before the transport committee next time, you know. They wouldn't mind. Or would that again come from the machinery of government?

Commr John Adams: Obviously, we will respond to your report on behalf of the minister, and ultimately the government, because it has to come to you through the Hill.

As I've said, and I will say it again, the challenge I'm really focused on and trying to get the coast guard to focus on is the resource challenge. I think if we get the resource challenge resolved, where we reside, while important, frankly is less important. So I'm focusing on that, and that's where our energies are directed, rather than where we live.

As I think I've said to this committee in the past, I could make arguments for Transport Canada. I could make arguments for National Defence. I could make arguments for the new PSEP department, the Deputy Prime Minister's department. I can make arguments for where we are. But I'm not getting into that. I'm focusing on the resource issue, and obviously we'll have to respond to your report.

Let me simply say to you, however, that Transport Canada has changed since we were part of Transport Canada. It is now very much a policy regulatory department, not an operational department. We are operators. I don't think we should forget that. They've made some fairly remarkable changes in Transport Canada, I think probably the majority of them initiated in Doug Young's time as minister, and they've shed most of their operational side. My guess is that they would cringe at the thought of the coast guard coming back to them.

Â (1205)

Mr. Peter Stoffer: That's why we astutely said it should be a stand-alone agency. If there had to be a minister responsible.... Transport is responsible for marine traffic and the coast guard is responsible for the safety of that traffic, and the synergy of that made sense to us.

My last question for you is this. When we spoke once before, I asked you, is it the mandate of the coast guard to guard the coast, and you said no, it's not. So give me a little history lesson. I've never asked this question, but I know no question is stupid. How did it ever get the name the “coast guard”? For the average Canadian, the coast guard guards the coasts; that's just sort of what it means. So how did it get the name the “coast guard”?

Commr John Adams: It's a bit of trivia, yes. I think what.... It probably came.... I don't know. I'm not a history buff. Sorry.

I'll make it up anyway, what the hell. I think all countries probably have a kind of thing called a coast guard. Frankly--and you folks have visited some of them--no two of them are the same. The vast majority of them are on the water, but to give you an example, some of them are called border agencies; in eastern Europe many of them are called border agencies. But when you talk to them, you find they do guard the border but they're not responsible for safety.

We're just the opposite. We are on the coasts. We guard for safety but we do not guard for security. We guard in the safety aspects, but it's never been our mandate to be an enforcement agency.

Mr. Peter Stoffer: Mr. Chairman, this is my very last question.

The Chair: No, no. I've been very lenient. We'll come back to you. There's going to be lots of give and take here.

Mr. Matthews.

Mr. Bill Matthews: Thank you, Mr. Chairman.

Commissioner Adams, I just want you to answer one question. A few weeks ago Minister Regan announced some additional surveillance for the nose and tail of the Grand Banks and so on, the Flemish Cap. If I recall correctly, there is supposed to be some modification or restoration work done on one of the vessels, the Cygnus.

Commr John Adams: Yes.

Mr. Bill Matthews: Is that work ongoing now, or is that going to be tendered?

Commr John Adams: We will tender it. We are right now writing the specifications to ensure, obviously, that we identify what's required. We'll then go to the trade to tender it, and we're hoping to have that in train in weeks in order to get the vessel out and into the water around August 1.

You must recall that the Cygnus has been alongside for 18 months to two years. It has lost its certification, so it's going to have to be recertified, which means it's going to have to have a fairly major refit. No secrets--I'll tell you that it's a fair amount of money. I would just as soon not get into the amount, because it will be tendered in due course, but it's a considerable amount.

Mr. Bill Matthews: So you realistically hope to have the vessel operational by August 1?

Commr John Adams: Yes.

Mr. Bill Matthews: Where will the vessel then be based?

Commr John Adams: Basically, it will be officered out of Maritimes region but crewed out of Newfoundland, because it is a Maritimes vessel and we're not sure it won't be coming back to the Maritimes region. So what we're going to do is officer it out of the Maritimes region because those officers will be part of the refit and will know the vessel the very best. The crew will come from Newfoundland because they have far more experience with the NAFO area and what we have to do out there than do the Maritimes crews. So it will be a combined crew, Maritimes and Newfoundland.

It will not in all likelihood go out onto the banks. It will go up and do SAR off the coast of Newfoundland, and that will allow the Cape Roger to go out on the banks along with the Leonard J. Cowley. But if push comes to shove and either the Roger or the Cowley gives us a problem from the point of view of maintenance, then we have the Cygnus crewed with Newfoundlanders, who then can go out onto the nose and tail of the banks if that's what is required.

Mr. Bill Matthews: So will this mean additional hiring in the coast guard?

Commr John Adams: No. We think we can absorb that within existing levels.

I don't know whether I've explained to this committee what we're trying to do. In spite of the fact that we've taken a number of vessels out of service, we have not in fact declared any mariners surplus. What we've done is we've reduced our need for terms and casuals but retained all of our indeterminate employees. The rationale for that is to try to establish what I call an operational reserve, an operational pool of mariners that will enable us to use indeterminate employees to replace folks who are on course, folks who are sick, or folks who just don't want to go to sea today. Rather than going to terms and casuals, we'll use our operational pool to do that.

So what we're looking to do is to draw on that pool in order to crew the Cygnus until such time as we see what the long-term commitment for the NAFO-regulated area is.

Â (1210)

Mr. Bill Matthews: Will the Newfoundland crew members be given a bonus for sailing with Maritimes officers?

Commr John Adams: No, I don't think even the Maritimes officers will get the bonus for sailing in the NAFO-regulated area.

Mr. Bill Matthews: I was thinking about the chain of command. We'll have to teach them so much.

The Chair: Anything else, gentlemen?

Mr. Cuzner, you may have a minute.

Mr. Rodger Cuzner: In the absence of our colleague, John Cummins--and I apologize if I have missed this previously--I would like to know the status of the procurement of the second hovercraft in B.C., just off the airport hub.

Commr John Adams: The Liv Viking.

Mr. Rodger Cuzner: Is it complete now?

Commr John Adams: No. The work is complete. It will complete its trials momentarily and then it will be put into a container ship and moved over here for July 1, which is a little later than we'd hoped, but that's the story.

The Chair: “Over here” being the west coast?

Commr John Adams: The west coast, yes.

Mr. Rodger Cuzner: So what track did you take on that? There were a couple of different options in the procurement. Is this a refit vessel?

Commr John Adams: It's a refit vessel--literally down to the hull and rebuilt.

Mr. Rodger Cuzner: Similar to the one that was on the site before the....

Commr John Adams: It is a newer version not of the Siyay but of the previous vessel that was on the site before, yes. It's designed for search and rescue. We're very optimistic that the west coast will be more than satisfied with that vessel. In fact, we just brought our team back. They went over for the final review of the contract with Public Works and Government Services Canada, and we're very satisfied with the work they've done.

The Chair: Rodger, I'm sure Mr. Cummins will appreciate the fact that someone remembered the west coast hovercraft. I don't know that he'd necessarily be happy with the answer, but at least the question was brought up.

Commr John Adams: I assure you he wouldn't be.

The Chair: Mr. Hearn, please.

Mr. Loyola Hearn: Thank you very much, Mr. Chair.

I would like some clarification. You mentioned that nothing is happening with the vessel traffic centres. They stay as they are, for now at least?

Commr John Adams: That's correct.

Mr. Loyola Hearn: On early retirement, undoubtedly your department is getting deluged with postcards--I know we are--in relation to early retirement for people involved in the fishing industry, particularly plant workers. When the original retirement program was put in place a number of years ago, I guess somebody did a poor job on it, because this is what happened. If you had been working in a plant for four or five years, but happened to be 55 years or more at the time, you ended up being retired for life. If you happened to be 54 years, and you had dropped out of school and gone to work in a plant for 40 years, which some people did, or fairly close to it, you had nothing. These people have been really upset for quite some time at the fact that they worked for 30 or 35 years and more and yet weren't recognized in the early retirement program. There was no combination of service and years. Somebody who worked for three or four years, or whatever the minimum was, but happened to be older when they went to work, had a retirement package.

Has any talk been given to taking more people out of the fishing industry because of the problems we have? And I'm thinking specifically of the plant workers here more so than the fishery and the rumours kicking around that something is going to be done. Can you clarify that?

Mr. George Da Pont: I'm afraid that's a question we'll have to refer to our colleague, David Bevan, to respond to.

Â (1215)

Mr. Loyola Hearn: Okay.

On the status of the shellfish fishery this year, from your perspective, we're hearing two things. On shrimp, shrimp is smaller. Markets consequently are not as good, the price is low, which is causing a major problem, especially for the smaller boats. On crab, there are varying stories. Stock is good in some areas; other people are saying yes, we have just as much as last year, but we used more pots, went farther, made more trips. It's fairly dangerous when you start hearing that.

What are your scientists telling you about the state of the crab--not the state of the stocks, necessarily, but also the condition in relation to size or whatever?

Dr. Wendy Watson-Wright: Yes, we are hearing the same thing you're hearing. I don't have the specifics with me at this point, but we are discussing right now what is happening with the Newfoundland science region. A stock status report has just come in recently, and I would like to be able to provide you with more information on that, if that's okay.

Mr. Loyola Hearn: Sure.

Dr. Wendy Watson-Wright: On the shrimp, I had a discussion this morning with Bruce Chapman of GEAC about their wish for us to evaluate the information more. We will be discussing shrimp with my director general of the fisheries side, Bruce Atkinson, my regional director of science in Newfoundland, and CAPP, the Canadian Association of Prawn Producers. So the questions are there, and we will be addressing them with the industry and our scientists.

Mr. Loyola Hearn: What about exploration outside the 200 for crab? We've done some work, and I'm hearing there's a tremendous resource out there. There are a number of boats--65 to 100, or even over 100--looking for access. Have you done anything further there? It might be a whole new resource.

Dr. Wendy Watson-Wright: To my knowledge we have not, but that's not to say we haven't done anything. Again, I would have to confer with David Bevan, as well as our science folks in Newfoundland.

Mr. Loyola Hearn: Mr. Chair, let me come back to the question I raised when you were here and Mr. Da Pont mentioned that the harbour authorities in Quebec were putting on a lot of extra pressure again this year for dredging money. You sort of asked why the others weren't lobbying.

It's my understanding that harbour authorities are not the ones, and perhaps should not be the ones to lobby the minister or the department. We have regional offices that are supposed to set the priorities and submit them to government. They are funded based on the percentage we've been given today of money that goes to each region.

They are the ones who are supposed to set the priorities and come to government. Historically, money has been allocated based on a number of different factors for each region. What we're getting here is internal manipulation--bypassing of the system to go the political route to get more money. It's as simple as that.

The Chair: Mr. Hearn, excuse me.

Mr. Da Pont, is Mr. Hearn correct that it's the regional people who should be making the decisions, without being lobbied?

Mr. George Da Pont: We apply the budget allocation formula. The regional people, as I explained, work out priority rankings for projects within that budget. Obviously, that's done in consultation with the harbour authorities, as should be the case. So there is discussion with the harbour authorities around the overall budget for the region, because it affects the amount of work and the new projects that can be started in that region.

I would also add, as I indicated in response to the chairman's question, we're getting similar representations from the central and Arctic regions. So in setting the priorities within the budget for each region there is discussion with the harbour authorities, so they're generally aware of the overall budget.

Mr. Loyola Hearn: That doesn't clarify.... Sure there's discussion, because in every harbour that's recognized as the core harbour and where there is a federal facility we are supposed to have a harbour authority--and we have many. They are the ones that lobby the regional office. Whether it's for repairs to the wharf, or because the breakwater got washed out and there's storm damage--everything that's handled--they lobby the local regional office. The regional office is supposed to submit its....

The harbour authority of Baccalieu is not supposed to bypass the St. John's office and come to Ottawa to lobby politicians or the minister. They ask for support, but we should not be dealing...because harbour authorities are telling the minister they want money for dredging. They do that within their region, and if dredging is the priority, they get money for dredging. If a wharf is the priority, they get money for a wharf.

What we have here is manipulation of the system to get more money into Quebec. It worked last year, and they're trying it again this year. It is as simple as that.

Â (1220)

The Chair: Is it as simple as that?

Mr. George Da Pont: Sorry, I didn't fully understand the question the way you posed it in terms of how the pressure is coming forward. In fact, the pressure did come from the harbour authorities to our regional office. They drew it to my attention and asked that it be drawn to the attention of the deputy minister and the minister at the request of the harbour authorities.

I don't know if any of them have contacted the minister's office directly. I'm not aware of that. I don't know one way or another.

I'm sorry, if the question is did it come through appropriate channels in terms of being brought forward, the answer is yes. It came from my office up to the deputy minister's office.

Mr. Loyola Hearn: Okay, I appreciate that, but I would suggest that the same is true in every region, because I certainly know in our own region the office is deluged with requests, any of them from my own riding, for funding. To say that Quebec is lobbying others.... They might be lobbying for dredging money, but we're lobbying for something else, in Bill's case. So basically, the lobbying should be done to the region that submits their priorities, that should get their percentage of money and deal with the priorities. If it's dredging, well and good, but that is not what's happening. We're seeing the amounts being skewed because of internal manipulation.

I'll leave it at that, but I guess it will come out in the wash.

The Chair: That's nine minutes, if you don't mind.

Mr. Loyola Hearn: Okay.

The Chair: We'll have one more chance for you.

Anybody on this side?

I have questions. I can take five minutes.

Our researchers have done a lot of hard work to prepare some questions for us, and one of them I consider a rather interesting technical question. It's not my style to have long preambles, but unfortunately in this case I have to have a preamble.

The Public Accounts of Canada information for DFO reveals some trends since the incorporation into DFO of the coast guard. In the past seven years, the average authorized available capital expenditure for fleet management, which we've been talking about, has been $67.4 million, of which only $36.8 million, on average, or 55%, was used. At the same time, the operating expenditures used for fleet management are consistently higher than the available authorities. Over the past six completed fiscal cycles, with the exception of fleet management, the four business lines under the purview of yourself, Commissioner, have seen their operating expenditure reduced by a total of $200 million and their capital expenditures by $61 million.

So here is the technical question: Since capital and operating expenditures are authorized by Parliament under different votes, how can DFO transfer moneys from vote 5 to vote 1 without Parliament's approval? Can you answer that?

Mr. George Da Pont: I'm not aware, sir, that we have transferred money between votes without the appropriate approval.

The Chair: Can you check on it?

Mr. George Da Pont: I'd have to check.

The Chair: Would you be kind enough to do so and determine whether in fact that has happened? If it hasn't happened, that's the end of it. If it has happened, how did you do it?

Mr. George Da Pont: I'd have to check on it, based on the comments that you've outlined, and get back to you.

The Chair: Okay, there is lots of time to get back to us on that. That would be great.

That's fine for me for now.

Mr. Stoffer.

Mr. Peter Stoffer: I have another question for Dr. Watson-Wright.

Again, I have a little preamble before it, but when Yves Bastien, the former Commissioner for Aquaculture Development, did his report, was your department asked for input into that report?

Â (1225)

Dr. Wendy Watson-Wright: Yes.

Mr. Peter Stoffer: Okay, so my question, then, is on a preamble here. This is a recommendation by Mr. Bastien that the federal government establish regulations pursuant to section 36 of the Fisheries Act to authorize the disposition of deleterious substances in relation to aquaculture operations under prescribed circumstances and protocols. Furthermore, it recommends that habitat officers should be given the discretion to avoid having to consider whether a new or proposed aquaculture operation is likely to cause a harmful alteration, disruption, or destruction of fish habitat under subsection 35(2) of the Fisheries Act.

My question is--and I thank the research team for bringing this to our attention--is it fair to say that those recommendations prepared by the commissioner would exempt aquaculture from environmental regulations? Is that a fair statement?

Dr. Wendy Watson-Wright: First of all, I'm not the best person to answer this question, but I would say no.

Mr. Peter Stoffer: I see.

The Chair: Who is the best person?

Dr. Wendy Watson-Wright: Sue Kirby, the ADM of oceans and habitat management.

Could you re-articulate the question?

Mr. Peter Stoffer: Sure.

It basically states that the federal government should establish regulations pursuant to section 36 of the Fisheries Act to authorize the deposition of deleterious substances in relation to aquaculture operations under prescribed circumstances and protocols. What that means is if a pen is full of sea lice and they have to kill the entire pen, say 30,000 salmon, they used to have to treat that as a hazard, which meant it had to be composted, burned, or whatever, on land. But there were exemptions given last year where all of that fish can be dumped out in the ocean.

This is what Mr. Bastien is asking for, exemptions under certain circumstances and protocols to allow the dumping of that fish. Their argument, when I discussed it with him, was that maybe ten fish in that whole pen will have sea lice and the rest won't, so the deleterious substances are quite small in that regard. So they could dump it into the ocean and it would save, obviously, the aquaculturalist money and everybody else.

The Chair: Ms. Watson-Wright, do you understand the nature of the question, or shall we put it in writing for you?

Dr. Wendy Watson-Wright: That's a recommendation. We have not responded, I don't believe, to that report yet.

Mr. Peter Stoffer: But before I had asked if the commissioner came to your department looking for advice or something on his report. So would your department at all have indicated to him that, yes, as a science department we could possibly support the dumping of contaminated fish into the ocean? Would your department recommend that in any way to him?

I'm wondering how he came up with this regulation, unless he just went to the aquaculture owners and said when we have bad fish we want to get rid of it and just dump it into the ocean instead of having to spend all this money trucking it to a landfill site, etc.

Would your department recommend to him in that regard?

Dr. Wendy Watson-Wright: In this case, it's his report and these are recommendations to the department. When you asked were we involved, yes, we were to a certain extent, but predominantly it was the industry. And as I say, we have not yet responded to that report.

Mr. Peter Stoffer: All right.

The Chair: Can you tell us what happened to the Office of the Commissioner for Aquaculture Development and what happened to the Commissioner of Aquaculture? Can you bring us up to date?

Mr. George Da Pont: I can in a general way.

The term of the Office of the Commissioner of Aquaculture Development expired at the end of March, as did Mr. Bastien's appointment. Mr. Bastien has now joined the department as the executive director of aquaculture management, and the resources that were formerly allocated to the Office of the Commissioner of Aquaculture Development will be absorbed into the existing Office of Sustainable Aquaculture.

The Chair: Interesting.

On that point, Peter.

Mr. Peter Stoffer: We heard that happened, but it's amazing, because one of the recommendations by Mr. Bastien when he was the Commissioner of Aquaculture was to take it out of DFO and move it into Agriculture. Yet he just got re-employed within DFO.

The Chair: I think we'll have to wait for the government's response to the recommendations.

Â (1230)

Mr. Peter Stoffer: I find that quite fascinating. Here's a guy who says take this department out of here and move it to Agriculture, and, by the way, I'm still with DFO in another role.

The Chair: Anyway, we got the answer to the question.

Mr. Hearn.

Mr. Loyola Hearn: Very briefly, Mr. Chair.

I have a follow-up to your question about moving money. You're talking from vote to vote, even within votes. I'll come back to the $47 million, I believe it is, in capital funding last year for the coast guard that was spent on operations. Now the department is scrambling to try to get that back, going to other divisions, including small craft harbours, I understand, looking for that money.

I've been told--and I've asked this question a couple of times--that a couple of years ago our committee was extremely instrumental in getting, in fact responsible for getting, $100 million extra to put into the small craft harbours budget. We were assured, because we asked the question, that it would be spent, every cent of it, strictly on infrastructure.

I'm being told that is not the case, even though reports might say so. There was a fair amount of internal manipulation, which leads me to ask for a comment on the comment made by higher officials in the department in relation to the estimates that the main estimates are really only paper to feed the process, and once we get the money we can do what we want. Is that generally the attitude?

Why are we so concerned about estimates and every cent when at the different levels, from the minister to the DM, the ADM, directors and managers, as it gets down to the field where the money is actually put into play, everyone has a swing at his or her own priorities along the way?

The Chair: Who would like to answer to that?

Mr. George Da Pont: I can start, and maybe my colleagues can jump in if they choose to.

First of all, I think we take the main estimates very seriously. They're obviously the structure under which the department gets funding and under which the department has to report to Parliament on what it has done with that funding.

As this committee has noted--and quite frankly, we agree--the current structure of the main estimates doesn't lend itself very easily to tracking funding on a program. We are working internally with the Treasury Board to get a new program structure for the main estimates that will be, I think, more straightforward, more transparent, and able to provide the committee with a little better level of detail in terms of the actual spending. So if people have expressed maybe frustrations on the departmental side from the main estimates, it's partly in relation to that. I think we agree with some of the comments this committee has made in terms of it not always being easy to explain where the money is actually going.

On the second part of your question, money is moved around from time to time, but it's done with due process. Moving money among votes, as I'm sure the committee is aware, requires explicit authorities in place, and we do follow all the requisite authorities. So there isn't a high level of discretion to move money around inadvertently, and so forth. Obviously there are always some readjustments that take place, but we do follow clear processes internally for that.

Mr. Loyola Hearn: I have just a short comment and then a question.

Again, I realize the type of department you have. For small craft harbours in particular, a winter storm could throw your budget completely out of whack, because people have to have a wharf to fish from, and if it's bad enough, you have to get in there and do it.

For the coast guard, heaven knows what might happen in relation to extra costs--surveillance incidents off the coast, an oil spill, research, you name it, or again, suddenly we realize the crab stocks are in danger. We realize that you have to have flexibility, and when we start sounding petty, we really don't mean it.

We fully realize that you have so little money to do so much. We think a lot of people don't appreciate that, and maybe some of the work we're doing here might be able to help you along the way. But I do believe you have to have some flexibility, because it's that type of department.

I have one other question. Just recently Parliament passed a motion suggesting that government take custodial management over the nose and tail of the Grand Banks and the Flemish Cap. Parliament did speak. It has spoken on that issue. Is the department going to take that issue a little more seriously?

I know we're going through doing this this year, and that this year, but in reality--and I think I've said it before--issuing more citations is really not going to solve the problem. Either we have to use our influence to show leadership in NAFO to convince them to set up a mechanism for enforcement, proper surveillance and enforcement.... Surveillance is great. We have the best aerial surveillance in the world, I would suggest, and certainly the coast guard is beefing up there, but it means nothing if you can't enforce the abuses you see out there. Are we getting anywhere with this?

Â (1235)

Commr John Adams: It's not really one of our direct responsibilities, but I have sat in on some of the discussions because of some of the additional platform support required for what we're calling the enhanced NAFO regulatory initiative by the department. The deputy has reallocated, within the department, sufficient funding to enhance what we've been doing in the past to include not only additional vessels, but also additional over-flights and obviously additional conservation and protection officers on the vessels.

Of course the issue of custodial management is much bigger than the Department of Fisheries and Oceans. It is very much a DFAIT issue. Consequently, they've been having interdepartmental discussions with respect to what the art of the possible is with respect to custodial management, because in some parts of the world they would consider it an act of war if you tried to exert custodial management over the nose and tail of the banks, given its current location.

I can confirm that there is a great deal of discussion. We are also looking at what custodial management would entail. I can tell you that it will entail more resources than I currently have with respect to CCG vessels. It will certainly entail a completely different approach on that coast by the Canadian Forces Maritime Command than they've exerted in the past.

There are very real international concerns and responsibilities that will have to be factored into all of those discussions, but they've taken it very seriously and have already engaged in discussions at the deputy-minister level. There's an indication that there is interest at the very highest level on what we can do to address this challenge.

You're right. It is a very serious concern on the east coast, and it certainly has been recognized by our department in conjunction with other departments as well.

The Chair: Thank you, Commissioner.

Indeed, I can confirm as well that as a result of a variety of things, including our reports, both the Prime Minister and the Minister of Fisheries are well aware of this issue and are considering a variety of plans, options, etc.

Anybody on this side? No? Then we'll go to Mr. Stoffer.

I have a maximum of ten minutes left, because I have another committee to go to.

Mr. Peter Stoffer: I only have two comments, actually.

Mr. Adams, I appreciate your comments regarding the custodial management. I understand this crosses departments and that you may not be the one to fully answer it all, but as the adjacent state, we have responsibility for the protection for those fish stocks because they are straddling stocks. I think you need to stress among the powers that be that we should do whatever it takes to protect the fish habitat and the resources, because to not do so would mean the economic consequences would be unbelievable.

We saw what happened to the cod. That has declined for a variety of reasons. We shouldn't allow overfishing or the raping and pillaging of our coastline to deter us, because this is going to cost us more money, because to not do so would be a tremendous waste.

Also, Mr. Chairman, you had mentioned that $200 million was transferred, over certain years, from where it was meant to be into something else, right? How did they do that?

It's quite ironic that when Acting Commissioner Turner was here a few years ago, we had asked him a simple question: “Was money ever taken out of the coast guard and put into other aspects of the Department of Fisheries and Oceans?” The number he came up with was that approximately $200 million had been taken out.

It's ironic that those numbers keep popping up all the time. Sir, this is why we made the recommendation to get it out of DFO. I can't speak for the committee, but I'm convinced that the money has been taken out of coast guard operations and moved into other aspects of DFO.

Am I correct when I say that?

Â (1240)

Commr John Adams: Not in my opinion, no.

The Chair: Mr. Stoffer, to be clear, our researchers did look up Mr. Turner's evidence and found the quote. It doesn't exactly back up your interpretation, at least on the cold reading of it. I wasn't there at the time the evidence was given, but as far as we can tell, he didn't say exactly what you have said, to be clear on it.

Mr. Peter Stoffer: Okay. Sure. I remember going to Mr. Dhaliwal on that as well.

The Chair: All right. In the absence of anything else, if I may, I'll finish off with a couple of questions.

On navigable waters protection, it's supposed to be under review. It's very important. Is it under review? What is the status of it? Do any of you know that?

Commr John Adams: I don't know what “under review” means. We did assess where it would be best placed within the Department of Fisheries and Oceans, and that was concluded. As a result of our assessment of the reality, we moved it to the habitat sector, because of the overlap in operations, which was clearly there.

But the December 12 decision has moved navigable waters protection from Fisheries and Oceans to Transport Canada, and that has now taken effect. So it has moved over to Transport Canada.

The Chair: Okay. That's interesting information.

What I meant was that DFO had identified the need to amend the act. That's what I was getting at.

Commr John Adams: Sure.

The Chair: And they had begun a policy review of how to do that and to come forward with amendments to the act. I take it that if the legislation has now been moved over to Transport Canada, you're finished with that process.

Commr John Adams: That is correct.

The Chair: Do you know if whatever work was done by your department has been passed over to Transport now, so that we don't reinvent the wheel?

Commr John Adams: I can confirm that the work that has been done has been passed to Transport, but I can also confirm that not an awful lot of work was done. Transport Canada recognizes that there is a very serious need to get on with that review, and I'm sure they will attempt to find the resources to do that, which was the challenge we were facing.

The Chair: You were saying that they've now become a bunch of policy wonks, so this will be perfect for them.

Commr John Adams: Absolutely.

The Chair: All right.

Commissioner, is the coast guard considering using drones, unmanned aerial vehicles, for surveillance of our coasts?

Commr John Adams: No.

The Chair: Have you done any studies on this?

Commr John Adams: I was just going to say that I can confirm that National Defence has done a fair amount of review of drones and in fact are using them in Afghanistan and are looking at further use of drones in other applications. But they have a lot more money than we have, so we're going to let them continue to do that and we'll benefit by that, I hope.

The Chair: All right, good. Thank you.

Dedicated satellite surveillance capability has allowed, for example, the tracking of oil slicks, and we know about the Tecum Sea and RADARSAT, and those sorts of things.

There was an original pilot project in 2002 for a six-month period, and I'm told it was that pilot project that allowed for the detection of the oil slick traced back to the Tecum Sea. Has that pilot project been extended?

Commr John Adams: I can't answer that, except to say that it wasn't just our department.

That was one application of the satellite technology. We have continued to argue that it's a good application, which we would like to pursue, but of course they say “Put your money where your mouth is”. Resources have been the challenge.

Mr. Loyola Hearn: On that point, Mr. Chair, the satellite surveillance of the Tecum Sea, for instance.... The case didn't get to court, but was dropped when they got to the courthouse steps. One of the reasons given by some people was insufficient evidence.

How good is this surveillance? Apparently, from what we understand, it was a cut-and-dried case, but somebody decided that it wasn't.

Commr John Adams: I can't speak to that. Prosecutions are not our—

Â (1245)

The Chair: We clearly mentioned it in our report in detail, and with great disappointment. Hopefully, there will be some response or attempt at a response, or whatever, by the government.

Commr John Adams: Yes.

The Chair: Does anybody else have anything?

Mr. Stoffer.

Mr. Peter Stoffer: Mr. Adams, I just want to clarify, is it your contention then that no money has ever been taken out of the coast guard and put into regular DFO operations?

Commr John Adams: No, not at all. As a department, we obviously look to the highest-priority items, but what I'm saying is that we were not raped and pillaged. It was done in consultation, as any department does: “What are your highest priorities, and what are the flexibilities available to you in order to address them?” We are part of the Department of Fisheries and Oceans, and we're part of those discussions.

Clearly, if there's a higher priority than ours, that's the prerogative of the deputy minister and the minister.

Mr. Peter Stoffer: The reason I say that is that when you speak to the workers, especially in Halifax, Newfoundland, and Vancouver, and with the ones who have been there with Transport and now with DFO, they say that the coast guard was treated like a bank account within DFO, and that it keeps getting drained.

In fact, our researchers said that the $200 million meant for capital expenditures over seven years had to go somewhere. Did that $200 million go back into coast guard operations, or did it go somewhere else within the department?

Commr John Adams: As we've said, we can't speak to that $200 million. I have no idea. But I can address some of what has been said, if I may, though it wasn't a question.

I think what inevitably happens when you speak to employees is that they miss the overarching atmosphere that was prevalent when the coast guard was merged with Fisheries and Oceans. There were actually three quite major incidents or changes that occurred almost simultaneously.

There was the move from Transport Canada to Fisheries and Oceans. That upset a lot of people. People generally don't like change; that's the reality.

The second thing that compounded that change was the fact that we were in the midst of program review. And you're absolutely right: our employees were really hammered quite significantly. But all employees were hammered during program review. We lost between 30% and 40% of our resources; that's money and human beings. Unfortunately, they confused that with the merger. But they were coincident. The one was traumatically difficult for them. You were merging cultures; you were taking three different fleets, the science fleet, the C and P fleet, and the coast guard fleet, and trying to merge them. They were quite different cultures. That was compounded by the fact that we lost between 30% and 40% of our total resources.

On top of that, they imposed the requirement for fees for service. Again, that was a cultural change to the coast guard, because what the coast guard employees said was, “Clearly, they don't understand, as you can't put a price on a life”. Frankly, we put prices on lives every day. There isn't an ambulance at every street corner, and there isn't a hospital in every single solitary community.

So those are tough decisions that have to be taken by governments, and they took it. What they said was, “We're not putting a price on a life, but if it's for private gain, the private gainee will pay”. It's as simple as that. But that was a change for the coast guard.

Those three traumatic changes in fact had a profound impact on our employees, but we continue to say that it's all a result of the merger. Frankly, I do not subscribe to that theory, and I think it's overstated. The merger was a challenge, but it came with a 30% to 40% reduction in resources as a result of program review, not as a result of the merger. I think that's really important to remember.

The Chair: Thank you, Commissioner, and we'll leave that as the final word.

I want to thank the officials for coming, and I thank your officials who have come with you to provide information.

As you have undoubtedly noticed, we've spent three full meetings of this committee on the estimates this year, which I think demonstrates a level of commitment on the estimates far beyond what there has been in the past. Hopefully, this will be a precursor of things in the future. We encourage you to work with us to get the estimates of DFO written in a readable manner, at least readable for laypeople like us.

Thank you for your candour and comments. We look forward to the responses to the other things we didn't get answers to. Thank you very much.

We won't have a meeting on Thursday, then. We will have a steering committee meeting so we can decide what we're going to do on Tuesday and following.

Thank you.

I adjourn the meeting.