By the South West Nova Fixed Gear Association Copyright, January 1995
This is a plan for organizing the new Canadian Maritimes fishery. It was developed by professional, independent fishers and is based on principles of conservation, efficiency, stable employment and self-reliance-not reliance on public money. It calls for a fleet of owner-operated fishing vessels regulated by decentralized co-management to ensure that as Canada's fish resources rebuild they will benefit the people who catch them and the society those people enrich.
We live and fish in the Maritimes. We believe our proposals are valid for the Northwest Atlantic fishery in general, including Newfoundland, but we have limited their context to the area with which we are most familiar. We welcome comments and support from fishers in all areas, and hope they find it useful in correcting their own situations.
This document represents the expertise and experience of many people. On the initiative of Gary Dedrick, Executive Director, and Bill Williams, Board member, SW Nova Fixed Gear Association (SWNFGA), a group of fishers held discussions in October and November of 1994 in Shelburne, Nova Scotia which focused their long-standing frustrations with the structure and operation of the fishery. The sessions included members of the SWNFGA, which is an Eastern Fishermen's Federation (EFF) affiliate, the Maritime Fishermen's Union (MFU) and the Scotia-Fundy Inshore Fishermen's Association (SFIFA).
Table of Contents (WARNING: This is a long document!)
"My goal as Minister of Fisheries is simple. It is to protect the resource and help people make a decent living from the fishery." Brian Tobin, Minister of Fisheries and Oceans, speaking to the Maritime Fishermen's Union 17th Annual Convention, February 4, 1994, Truro, Nova Scotia.
This is an action plan for renewing the Canadian Maritimes fishery, developed by professional, independent fishers and designed for the twenty-first century.
Our objectives are:
* Sustainability of the fish and their ecosystem;
* Efficiency in maximizing the economic impact of the resource;
* Stability for our coastal communities;
* Self-reliance, not reliance on public money.
These objectives can be achieved by re-structuring the fishery and
establishing a new management system that will:
* Manage how, where and when we fish rather than how much we catch;
* Replace destructive technologies with sustainable alternatives, by converting, for example, CHP (cod, haddock, pollock) draggers to hook technology in order to conserve the resource, reduce fishing capacity and increase employment;
* Protect the resource by erring on the side of conservation when scientific advice is uncertain;
* Institute decentralized, cost-effective co-management that truly shares authority and responsibility between fishers and managers;
* Implement a mandatory dues system and 'professionalization' so that strong fishers' organizations can be effective partners in co-management.
* Establish a fully owner-operated fishing fleet for the conservation and economic benefits;
* Conduct a conserving, competitive fishery which spreads the economic benefits among those who catch the fish and their communities, and avoids the concentration of wealth that follows privatizing the resource.
"In 1993, following a sharp decline in catches, the scientific assessment revealed a situation where many groundfish stocks had declined to unprecedented low levels, with no evidence of large new year classes, low spawning biomass, and reduced spatial distribution." Fisheries Resource Conservation Council (FRCC) Discussion Paper, "Considerations on How to Re-open a Closed Fishery," September 1994.
The Canadian Maritimes Fishery: Let's Fix It is not meant to be an enjoyable document to read. It does not congratulate everyone connected to the fishery for their good works or their pleasant attitudes. The industry is in a horrendous mess. Most of our commonly fished species are at historically low levels. This is more than just today's bad news, more than just another environmental problem that will have to get taken care of sometime. This is a lot of people suffering - men and women, sons and daughters.
Those who see the fishery as a pile of papers on their desk or as one of their investments that isn't doing so hot at the moment don't see the pain. They're well removed from the splintered communities and families in upheaval, the children in trouble. Too often, what someone doesn't see doesn't have reality for them. Sometimes people can even ignore hardship when it lives next door. If their income isn't half of what it was four or five years ago, it's convenient to forget that a neighbour's is. This can be especially true if those people made the mistakes that caused their neighbour's loss.
As we said, this is not the funny papers. We're hurting, not laughing. We've lost income and opportunities, but we haven't lost hope - not yet. In his recent speech to the Fisheries Council of Canada, Convention '94, Brian Tobin warned, "...there's a narrow window of opportunity now, to make meaningful and substantial change in the way this industry operates." We agree.
However, we also know there have been similar windows before, and those opportunities were wasted. For decades, in numerous studies and reports, we have been told a succession of stories about why this industry has so often failed. In the last decade, Michael Kirby, Jean Hache and other prominents had their kicks at the can.
At this point it's time for us, the rubber boot crowd, to be heard. We believe it is essential to clearly identify the causes of the pain, so none of us will suffer from it again. There should never be, because there need never be, another 'seven-year cycle' in the fishery. The notion that circumstances beyond human control have regularly caused the industry to fail has long been pushed by the powers-that-be. They have used it to distance themselves from the real problems and to help maintain their control of the industry.
The fishery did not collapse by coincidence or happenstance - a lot of people fouled-up. It is a sad, harsh truth that certain sectors of the fishing industry, and certain managers, have made grievous mistakes. Those mistakes have inflicted extensive damage to our ecosystem, our communities, this region and the country.
Despite what our critics say, we're not hung up on the past, we're just tired of repeating it. In order to stop the cycles of failure it is imperative to determine what actually happened. We are not interested in punishing those responsible for the mess; we just want to change how they operate.
All of us must go on from here. With the knowledge of the past we can shape a future fishery that will yield meaningful, productive, and, yes, unsubsidized careers for tens of thousands of Maritimers.
2. The Problem
Sustainable development is "development that meets the needs of the present without compromising the ability of future generations to meet their own needs." Definition from the 1987 Bruntland Commission as used by Brian Tobin, Minister of Fisheries and Oceans, October 19, 1994, while addressing the Fisheries Council of Canada.
"Until the government grasps the real problems staring them in the face, then there is little chance for survival of our coastal communities. If all bottom dragging is gone, and everyone is strictly hook-and-line, then this is the answer - not the alternative. Get rid of draggers - not fishermen!" said Gary Dedrick, Executive Director, SW Nova Fixed Gear Association, February 12, 1994, to the Dalhousie Science Society.
In the winter of 1992, John Crosbie, then Minister of Fisheries and Oceans, closed the offshore codfishery on much of the Grand Banks of Newfoundland. Quite a hub-bub resulted. The press discovered the Northwest Atlantic fisheries crisis and, in turn, the Canadian public and the world did as well. We were told Canada's fish had been destroyed by cold water - with some help from foreign freezer-draggers and the seals. Richard Cashin, head of the offshore fishery workers' union in Newfoundland, led a flotilla of Canadian draggers out on the Banks to float a Canadian flag in a dory.
We had trouble with this scenario. We believed other factors were primarily responsible for the collapse of the fish stocks on the Maritimes fishing grounds and those off Newfoundland. Unfortunately, we were unable to get similar attention for what some of us had been saying for decades: that groundfish dragging would ruin the fishery. When Canada declared its 200-mile economic zone in 1977 the stocks were in hard shape. (We didn't realize then just how bad things could get.) Through the 1960s and 1970s they had been targeted by fleets of foreign freezer-draggers and our own growing fleet of draggers, in addition to the traditional fishers using hook technology and other gears. Around the shores most believed: The fish are finished - and so are we. Well, not quite yet.
After 1977 Canada pushed a lot of the foreign boats out and tightened up on landings and the fish did come back-some. The mini-recovery lasted into the early 1980s as the fishery off our coasts became more and more Canadian. But you're sure to be familiar with the old adage: If you don't learn from your mistakes, you will repeat them.
By the time of Crosbie's momentous announcement in 1992, our fishery, that of the hook-and-line fleets on the Scotian Shelf and elsewhere, had been in crisis for several years. 'Our' fish had long since reached historical levels of scarcity, slashing our incomes. Many of us had moved out of the groundfishery altogether to chase lobsters and other species that were doing better.
Not until 1994 did Brian Tobin, now the Fisheries Minister, identify the real problem behind the crisis. In a speech at the Coastal Zone Canada '94 Conference on September 21, 1994, he decried Canadian "over-harvesting of fisheries resources" as one result of a "pattern of development, with its emphasis on large-scale harvesting." Later in the same address he topped it up with: "We have done some things very badly...like manage fish stocks off our Atlantic coast."
The Grand Banks of Newfoundland are essentially shut down. With all the other closures and reductions in the fishery, this one inconceivable fact best conveys the sense of where we are. The statistical frosting is the number of workers in the Atlantic Provinces who have lost their jobs. (The Minister uses the figure of 40,000 fishers and plantworkers.) In this context, no intelligent process or solution is too uncomfortable or too upsetting to implement. No corrective action taken now could possibly be more radical than closing the Grand Banks.
It's time to go back to first principles. We can all learn from the mistakes that have been made. The framework of this broken industry must be closely examined so we can build a new structure that responds to the lessons of history.
And, while we're at it, let's not make a new mistake. Let's not pretend that the fishery began a few short years ago. It would compound the present tragedy to use recent stock abundances or activities as the 'historical' reference points by which we define our future fishery. To do so would permanently restrict what has been this region's major industry to a marginal role. Quite plainly, we should use the abundant stock levels of 1950, which supported a bustling industry, as our conservation targets. It will take the fish awhile to get there, but we can encourage them by being smart and patient. We must - if future generations of fishers are not to suffer today's harsh realities.
Our way of life is characteristic of this coastal region - it is our unique heritage-and well worth preserving. It is a reflection of the self-reliant personality of our coastal communities. The fishery must be run in a sustainable manner that keeps our fishing communities populated and vibrantly alive. Hardened by centuries of salt air, they will be self-supporting, if the fishery is rationally structured.
Combining our knowledge of what has worked in the fishery with that of what has so definitively not worked, we believe our fish resources can most effectively be conserved and utilized by co-managing How, Where and When Maritimers fish.
3. The Approach: How, Where and When
Fishers have long been sceptical about the usefulness of the numerical approach (quotas) to fisheries management. They've known how difficult it is to predict today's catch, never mind how many fish there will be next year. New research supports their position. It says, "that the complexity of fisheries ecosystems makes it impossible to achieve predictability of the sort necessary to make numerical control work." (October 1994, Commercial Fisheries News.)
Fishing is a business. People fish to make money. That ambition can produce the wealth coastal communities need, but, poorly directed, it has now produced their poverty. There are no boatloads of fish anymore, only decks full of history and experience. This teaches us that a modern fishing industry must choose the conservative course in order to protect the resources upon which it relies.
Since 1977 several billions of Canadian taxpayers' dollars have been spent mismanaging the Atlantic fishery into a sea of closures. Consequently, tens of thousands of Maritimers are now being supported by billions more of the public's money. This can't continue; the country can't afford it. Our families can't afford it. We face the obvious question: Who can navigate us past the dangers ahead to a fishery of renewed abundance and wealth?
The existing management structure is unable to do the job. The discredited fishing plans of the Department of Fisheries and Oceans (DFO) have centred around quotas for the amount of fish landed and have failed to control the amount of fish caught. Quota management was an attempt to limit overfishing by gear types like dragging and purse seining-technologies that were designed to maximize the profits from short-term investments. The difficulties with this approach have been chronic, systemic and, despite heavy expenditures, eventually catastrophic.
For forty years fisheries bureaucrats professed blissful ignorance of the crucial difference between catches (i.e., 'removals,' or all the fish caught) and landings (i.e., the fish reported as brought in, or the removals minus the fish discarded and those smuggled ashore). The dead, discarded fish - hundreds of thousands of tonnes of them - that were dumped at sea during the decades in which draggers have been predominant, represent our lost wealth and independence. Even today, many 'managers' refuse to acknowledge the connection between destructive technologies and the global decline of fisheries resources. The latest, and greatest, collapse of our groundfish stocks has damaged the credibility of DFO Science Branch as well. The Branch failed not only to accurately assess the stocks (or at the least to offer margins of error for questionable numbers), but also to document basic information such as actual fishing mortality. Department scientists have yet to quantify the extensive discarding and highgrading by the draggers, an open and disastrous secret that has finally been publicly verified.
Unfortunately, DFO remains in denial despite the evidence, much of which has been buried within the Department for years: for example, the observer reports that detail everyday dumping practices by the draggers, and studies from as far back as 1978 that do the same. Many Department scientists have tried to blame the massive loss of groundfish on environmental factors, although there have been noteworthy exceptions:
1. "Overfishing by Canadians was the biggest cause of the collapse of the Gulf cod fishery...Trawlermen [draggers] threw back more fish than the seals ever ate," Mike Hamill, DFO researcher, March 1994; 2. the lack of any 'Environmental Factors' in the 1993 western Scotian Shelf assessment summaries to explain the decline in the stocks; and 3. the 'Environmental Factors' section in the summary for Georges Bank cod which reads, "No abnormal water temperature conditions or long term trends have been noted on Georges Bank."
Nevertheless, Canadian quotas have dropped sharply on Georges and, in an unprecedented move at the close of 1994, the United States imposed a three month moratorium on groundfishing in their portion of the famous Bank, due to the poor state of the fish stocks. If Nature didn't do it, who did?
Unfortunately, DFO's forty-year mindset has prevented them from listening to those who consistently predicted the collapse of stocks and profits - fishers who had the foresight to link methodology changes in the industry to the steady decline in fish abundance. Those same fishers were repeatedly accused of being ignorant, obsolete and obstinate because they refused to buy into the promises of wealth eternal that was theirs for the taking if they would just get smart and get with the program.
The Minister did eventually identify overfishing and mismanagement as the root causes for this half century's unprecedented decline in our fisheries, but he and his Department want us all to share the blame - and the pain. Speaking to the Fisheries Council of Canada on October 19, 1994, he declared, "...there is nobody in this industry without sin. There is nobody in this industry...who hasn't been part of the problem."
To avoid the real issues involved in a problem is to not solve the problem. No gear is perfect, but the hook fishery did not decimate our groundfish stocks - draggers did. It is critical that we make immediate changes in how our fish are managed and caught. It is evident that effort controls like quotas don't protect the fish when unsustainable technologies are used. We believe they are normally unnecessary when sustainable technologies are used in proper proportion to the available resource. However, until the fishery is rebuilt, we recognize that some form of effort control is needed to ensure and speed the recovery of devastated fish stocks.
Despite their admitted mismanagement, the 'managers' continue to defend their capability to reform their own department, the management process and the industry. Those of us who have endured the pain of their past mistakes have little faith that they will resolve problems they haven't grasped. Surely, it's reasonable for us to believe that if DFO were left to read the charts again, they would pile us onto the rocks for the final time.
3.2 How We Will Fish
"Efficient: marked by ability to choose and use the most effective and least wasteful means of doing a task or accomplishing a purpose." Webster's Third New International Dictionary, 1986. Merriam-Webster Inc., Springfield.
Catching fish efficiently is the cornerstone of long-term, profitable fishing. Given the limitations of the ecosystem, there is no doubt that fishers will catch all the fish that can sustainably be caught; it is only debatable how they will do it. The technology used is inextricably tied to the efficiency of the operation and to the future health of the stocks and our coastal communities. The use of hooks to catch groundfish such as cod, haddock and pollock satisfies the definition of efficiency - dragging for them does not.
Jobs Without Waste
Since the 200-mile limit was established in Canadian waters in 1977, most of the groundfish regulations and their consequent enforcement costs have been aimed at limiting abuses by draggers - not groundfishers in general. The misreporting of landings and the smuggling of fish has been a problem primarily linked to the dragger sector. Most importantly, the 'normal' discard rate of the dragger fleet is a major cause for the decline of fish stocks over the past forty years.
The Judge's decision delivered in the Provincial Court of Nova Scotia at Bridgewater on September 7, 1994 that convicted Adrian Swallow, mate on the National Sea Products stern dragger Cape Fame, of illegally dumping fish, states:
Although the mate denies being present when the discarding was done, it is apparent that he was very familiar with the methods used, and that the method was a routine procedure incorporated into and part of the whole fishing operation.
Draggernets by their nature are indiscriminate and damage many of the fish they catch. Towing fish in the codends of draggernets damages them. The length of tow (how long the net is dragged before it is emptied - commonly one to four hours) determines how badly they are squashed.
Draggers target schooling fish, commonly attacking and dispersing prespawning, spawning and postspawning aggregations. This disturbs reproductive activity and results in large catches of fish that are 'sick.' 'Sick' fish are ones that have recently spawned. They weigh less relative to their length (15% to 20% less) than 'good' fish, which means that more individual fish are killed per tonne of catch, and they are in poor condition. Taking 'sick' fish hurts the stock and reduces the profit per fish. It doesn't make sense. Longliners, who depend on fish to attack their gear, catch relatively few 'sick' fish. Fishers have known for generations that these poor quality fish are not generally attracted to baited hooks.
And, hooks use bait - a lot of it. Baitfish are primarily locally-caught species that are relatively abundant and hard to market otherwise. The bait cost is equivalent to the extra fuel used by draggers, per tonne of fish caught. Baitfish are a renewable, regional resource. Fuel oil is nonrenewable and usually from foreign sources. Bait equals jobs - Maritime jobs to catch, freeze and transport the baitfish, and to get it on the hooks. Longline-caught groundfish have historically brought higher prices than dragger-caught fish due to their larger size and higher quality which produces greater yields in the processing plants. Hook technology restricts daily catch rates, spreading the catch over a longer timeframe. The smaller catch per boat also means more landing ports which feed independent and profitable fishplants, helping to maintain the viability of coastal communities. This is in contrast to the glut landings by draggers at a few ports, which reduces product quality and the overall financial return from a finite resource.
With easily enforced regulations such as minimum hook sizes, the catch of small fish by longliners can be kept within reasonable limits - given reasonable fish abundance and age distribution. Dragging has consistently produced large bycatches of undersized fish when legal nets are used. Illegal liners are also used, which retain even more unusable, small fish in the attempt to increase the catch of larger ones. It is an expensive impracticality to stop the use of netliners by draggers.
Although mesh size and configuration changes can theoretically reduce the catch of small fish by draggers, dragging remains a fishery that targets recruits. This risks growth overfishing (i.e., catching too many fish before they've reached their optimum size.) and causes high year-to-year changes in sustainable catches, which complicates processing and encourages abuses.
The health of groundfish stocks is related to the state of their habitat. Decades of groundfish dragging with heavy rollers and 'doors' have taken their toll on the ocean bottom. Important fishing grounds have been damaged and/or permanently changed. This must stop. If we are to enjoy a bountiful fishery, we have to take care of our marine habitat.
In general, because of the baitfishery, gearbaiting, the need for larger and more experienced crews, and more saltfish production (which is labour-intensive), longlining produces more stable employment than dragging does—for the same amount of fish. This is verified by two DFO-funded studies completed in 1994. One was done in-house by Doreen Liew. The other was contracted out to Canadian Fishery Consultants Limited.
It must be remembered, however, that the total employment (crew plus processing) is still higher for longliners than draggers.
It is important to remember as well that in the Maritimes there has been for many years a restrictive 'limited entry' policy in effect for the major fisheries. This has kept the number of vessel licenseholders within reason. Although the number of 'paper' fishers may have risen in recent years, the number of operations and 'active' fishers has not. The long-term economic impact for fishing communities and Canada is maximized by using hooks to catch our groundfish. Therefore, to paraphrase Gary Dedrick of the SW Nova Fixed Gear Association: Let's change how we fish, not how many of us fish.
Conversions and 'Overcapacity'
In a rationally restructured groundfish fleet, some draggers would be outfitted to midwater trawl for redfish, some to Danish seine for 'flounders' in specified areas, and the rest would be converted to longlining. This is not a novel idea. On November 27, 1990, then Fisheries Minister Bernard Valcourt announced funding for converting groundfish draggers to longliners.
If we harvest the fish more sensibly and selectively, we will have more groundfish in the water, in the boats, and in the plants. This program helps fishermen to help themselves in the rebuilding of fish stocks.
It is worth noting that there were no takers for the money. The present 'overcapacity' of the groundfish fleet reflects the excessive catching capability of the draggers. Converting the majority of CHP (cod, haddock, pollock) draggers to longliners would immediately reduce the catching capability of the fleet by approximately 50% and provide meaningful employment in boatshops. This is a more sensible use of the hundreds of millions of dollars of public money ($37 million in Scotia-Fundy) allocated to reduce overcapacity, than the 'retiring' of people which the Harvesting Adjustment Boards (HAB) seem intent on doing. Conversions would be substantially more effective, and cheaper, than buyouts in reducing capacity and would utilize the skills fishers already have.
3.3 Where We Will Fish
Environmental conditions beyond our control will always vary recruitment from year to year, no matter how carefully we prosecute a fishery. We can minimize the effect of these fluctuations by leaving a generous stock of varied-aged fish in the water. It's our best insurance for a stable harvest over the long-term.
This basic tenet of conservative fishing requires that we: 1. Protect spawning and nursery areas; 2. Catch sexually mature fish that have spawned at least once; 3. Ensure the broodstock contains a significant number of large spawners; and, 4. Target different species at different times of year for optimal return.
A fishing fleet that has a large contingent of multi-species boats, those licensed to fish a number of species, can most profitably cope with the unpredictable natural world. Their flexibility can be maximized under enlightened and localized co-management which is responsive to changing conditions. Such co-management, unlike centralized management regimes, can fine-tune fishing plans as desirable.
Deciding where to fish is no longer a simple matter of going where there always were fish or even going where there used to be 'good bottom.' (Good bottom is the bread-and-butter of longline fishers.) Fish congregate on different types of bottom in different seasons. Knowledge of their preferences and movements has distinguished the highline fishers from the rest.
The closure of certain spawning areas during spawning times has been in place for years. This slowed the carnage, but obviously it wasn't enough. Even with the change in technology we know is necessary, we believe our fish need greater protection to reproduce and grow. The closure of additional spawning and nursery areas for longer periods of time, the delineation of gear-specific territories, and the establishment of several MPAs (Marine Protection Areas or sanctuaries) would reflect the cautionary approach that is required.
To be most effective, these kinds of measures demand the respectful cooperation between independent fisheries scientists and fishers. Rational co-management can ensure the separation of fisheries science from political or financial pressures. It would encourage fishers to keep full and true records, which would give scientists their best picture yet of the fishery; knowledge of the marine ecosystem would dramatically increase.
Some scientists have of late recognized the validity of fishers' 'anecdotal' knowledge. This represents a significant change in their attitude toward fishers, who are certainly the most experienced fish watchers. An improving atmosphere of cooperation between fishers and scientists will make it possible for a relationship built on mutual trust to develop. Together, they can learn to correlate fishers' traditional database with the extensive information available from modern marine electronics.
Given the proper structuring of a revitalized, all-hook fishery for cod, haddock, pollock and halibut, the numbers of inshore and offshore vessels will reflect the size and availability of the resource. After stocks regain their 'health,' quotas should become an anachronism. This will reduce our reliance on abundance estimates that may never be terribly reliable. Stock assessments will be limited to use as references and indicators of trends.
Both fishers and scientists have come to appreciate the complexity of the marine ecosystem. Predator/prey relationships are complicated and difficult to quantify. Many species are both predator and prey, their status changing as they grow from one stage of their life cycle to another. The various species we value are interrelated to an extent we are only beginning to understand.
For example, the decimation of East Coast herring stocks in the late 1960s by the purse seiners upset the complex marine food web, among other impacts, reducing the food supply for fish like cod. We can only guess at the multiplier effect this had on groundfish stocks - which were already reduced by the grossly wasteful practices of the foreign and domestic dragger fleets on our continental shelf. However, we do know that both technologies were profitable in the short-term and too damaging over the long-term. They are inappropriate in an intelligent fishery.
The abundance of our common commercial species is also tied to the abundance of many other species through a convoluted food web - the graphic depiction of 'who eats whom.' Species we consider of low value and others we completely ignore often have an important role in the life cycle of the species we target. It has become apparent that we destroy any native species at our peril.
Since 1977 we have allowed foreign fleets to catch silver hake, a food fish for cod, pollock and swordfish, in our waters because we have chosen not to fish them ourselves. Canadian processors could not market silver hake for sufficient profit so they were labeled 'under-utilized' and handed over to the factory dragger fleets.
The subsequent history of the silver hake fishery depressingly matches that of our commercial groundfisheries. The size of the individual fish has fallen as the stock abundance has drastically declined. The silver hake quota in recent years has been reduced annually and yet the catch has repeatedly fallen short of the quota. Sound familiar? Maybe like haddock in the 1980s? Incredibly, the scientist responsible for silver hake assessments has insisted that the stock is healthy and the fishery is doing fine. Our trust is still patchy at best.
The lesson here is that there are no underutilized species in our waters. All species are a functional part of the ecosystem we fish. The removal of any
species affects the abundance and profitability of others, so we need to consider the return from the total fishery when we are determining our fishing plans. Since our scientists are only starting to accumulate accurate data it will be many years if not decades, before we will have a good enough picture of species interrelationships and our affect on them to label any species 'surplus.'
The Fisheries Resource Conservation Council (FRCC), the advisory body on conservation to the Minister, also advocates an ecosystem approach to fisheries management. In its November 1994 Report, "Conservation - Stay The Course," they commit themselves on page four to supporting "measures which will ensure the long-term sustainability of Atlantic fisheries." They recognize not only the seriousness of the present situation and the state of fisheries science, but also the necessity to take immediate, corrective action. They recommend on page five:
With respect to an 'ecological approach,' until we develop more of an empirical understanding of this complex process, we have to characterize many of the interactions in the ocean intuitively. In the face of uncertainty - good decisions can be made using common sense. We must be cognizant, however, of the risks involved, but we must not be unduly fearful of proceeding down this road.
3.4 When We Will Fish
Fishers go fishing when there're fish to be caught - and when the rules allow them. The rules haven't always made sense.
For years, the small draggers in Souwest Nova had their largest quarterly haddock quotas starting in June, when the spawning areas are first opened after a three month closure. The fish are still schooled up; it's bonanza time for the draggers. Unfortunately, many of the haddock are also in poor condition. They're 'sick'; their flesh is watery and unpalatable, and they weigh significantly less than they would a couple of months later after they've regained condition. This is reflected on the processing line where fillet yields will increase from lows around 27% to highs around 40% (each percent of additional yield equals a 10% increase in net profit). Targeting souwest haddock in June doesn't make sense, but it did make a lucrative short-term fishery for some. We all got the long-term disaster.
These kinds of management blunders are avoidable. Decentralized co-management will allow traditional knowledge to inform the decision-making process. Local co-management committees will be able to direct fisheries to the best advantage of the stocks, the fishers and their communities.
However, it is critical that broad strategic guidelines be in place to channel the efforts of local committees. These guidelines need to be based on rational fisheries management principles like optimal yield, the encouragement of spawning and the protection of juvenile fish. Recruitment fishing, growth overfishing and similar suicidal practices must be eliminated. In general, we need to ensure that the timing of fishing effort maximizes the return from our catch.
We certainly recognize that our industry must supply the products that the market demands, but we cannot continue to rape our resource in order to fill a shopping list from fishbrokers. Sustainability requires us to be sensitive to nature's timetable or we will have no product to sell. Fresh fish and premium-quality frozen fish products simply cannot be available in all species year-round. Ontario peaches and West Coast salmon can't do it - and neither can Atlantic haddock.
Now is an opportune time to reassess our markets and our approach to them. As Alastair O'Reilly points out in his "Market Perspectives: Canadian Seafood Products" prepared for Richard Cashin's Task Force on Incomes and Adjustment in the Atlantic Fishery, Canada has already lost its market for low-end commodity pack products to cheaper substitutes. Trying to re-enter this market would likely "mean much lower processing sector wages and prices to fishermen." There's little self-supporting independence in that future. He goes on to suggest, though, that:
The alternative is to leave the sector to the 'substitutes' and to reposition Canadian groundfish, especially Cod toward higher value, upscale markets.
Some fish species can be taken in enough different areas at different times to produce an essentially year-round supply of fresh and quality frozen product. This would require a level of cooperation and coordination that would benefit the overall industry. A positive example is the organization of the Atlantic Canada lobster fishery. It has thirty-eight inshore districts with overlapping seasons that stagger openings throughout the year. The timing of the seasons takes into account weather and ice conditions of the different areas, and market demand. The catch is spread out, maximizing the return from it.
4. Co-Management: Who'll Be Running Things?
"...most importantly, more fishermen must become involved in scientific research, in stock assessments, in sentinel fisheries and in conservation decisions... That will be the most effective form of partnership. If we do this, I believe that in future, we can avoid many of the problems that we have had." Brian Tobin, Minister of Fisheries and Oceans, to the Maritime Fishermen's Union 17th Annual Convention, February 4, 1994.
"What is needed is a process and a structure managed from outside government within which parties can work with each other and with government." Evelyn Pinkerton. 1993. Local Fisheries Co-Management: A Discussion Paper. University of British Columbia.
Fishing is a dangerous, often dirty, physically and mentally demanding profession that requires skill and intelligence just to catch the slippery things. Then, you have to figure out how to make money doing it. To date, foolishly, the knowledge that fishers possess has hardly been incorporated into the management system. The new fishery, redesigned to benefit many future generations, will only succeed if fishers are an integral part of the managing process. Such 'co-management' is only workable between equally strong and committed partners.
Presently, the potential partners are not equal. The decision-making power has rested solely with the Minister and his Department - fishers have been mere 'advisors.' If co-management is to succeed, DFO will have to demonstrate its commitment by openly sharing its power. For their part, fishers need to have strong representatives to make sure that the fishery is sustainable and benefits the people of the Maritimes. Co-management cannot succeed unless both sides effect basic changes in their attitudes. It is essential that they each revise not only their own role in the managment process, but also how they approach that role.
4.2 Mandatory Dues
Historically, the independent fishers of Atlantic Canada have not been well represented. Despite being warned nearly 20 years ago by then Fisheries Minister Romeo LeBlanc that they must organize or lose out to other sectors, most self-employed fishers did not and have not joined professional organizations. Although membership in organizations is rising (crises have that effect), thousands of fishers remain outside the fold.
Consequently, the better organized sectors of the industry - the larger processors with their dragger fleets - continue to have a disproportionate influence on DFO policies - the same policies that have delivered the industry to its present state. These sectors have consistently denigrated the independent fishers and processors for being cumbersome and inefficient, when in fact it was the major players in their own sectors that periodically went bankrupt and needed public money to keep operating.
Nevertheless, their lobbying success is plainly visible today. They pushed for the 'development' of the fishery on the 'industrial' model. We have suffered the reality: the use of destructively powerful technologies for their short-term profit advantage and the consolidation of the industry into a few large and dominating, vertically-integrated corporations.
The 'other' side in the debate must now make its voice heard. After all, we fished profitably and sustainably for 400 years. Draggers have been a significant force in the Maritimes fishery 'only' since World War II. (1950 to 1990 - that's all the time they needed to destroy the best fishing in the world.)
Underfunded representative organizations are not able to properly deliver their message to DFO, the governments or the public. We have lost grievously, and the nation has lost with us, because we did not have the resources to wage the fight for a sensible fishery. Fishers' professional organizations have been underfunded mostly because fishers have not supported them in sufficient numbers.
What Do Others Do?
It's obvious that in any profession there will be a core of committed workers who will freely join and pay dues to representative organizations. It's as obvious that many will not. This is particularly true when the group involved is large and is spread over a wide geographic area. This makes it difficult and expensive for leaders to reach and convince potential members to join up. The problem is compounded when the potential members are independent people drawn to the competitive nature of fishing more than to cooperative ventures.
This situation reflects the common reluctance of Maritime workers to join professional organizations. Statistics are not complete here, but it's reasonably clear that less than half of Nova Scotian workers are members of professional organizations. Many groups that have been successful in strongly representing themselves to the public and government have used legislation to compel support from their potential membership.
Nova Scotia's doctors are a case in point. Provincial regulations require licensed and practicing Nova Scotia doctors to pay dues to the Medical Society of Nova Scotia (on a sliding scale to a present maximum of $995). They are not required to join the Society, although it is important to note that presently all of them are members. This 100% membership is presumably a result of both the mandatory dues requirement and the benefit package that is available only to Society members. The Society's dues were voluntary before 1985 and the 75% of doctors who were then members of the Society paid for it to represent all doctors. The paying doctors were not happy with carrying their non-paying colleagues and they secured the provincial legislation required to force all practicing physicians to pay dues.
Should fishers be any different from doctors or teachers or pipefitters? The Norwegians don't think so. All Norwegian fishers are required to pay 1% of the landed value of their catch to the Norwegian Fishermen's Federation. Although membership in the Federation is voluntary, less than 1,000 of 16,000 fishers have not joined.
In New Brunswick, the Maritime Fishermen's Union (MFU) finally got collective bargaining legislation that compells the collection of mandatory dues in 1991. This culminated a fourteen-year marathon that included passage of initial legislation in 1982, the fight to make that work and passage of more effective legislation nine years later. That's an awful expenditure of time, energy and limited funds just to get the basic tools to do your job.
First, the MFU had to convince fishers of the need for the legislation. Second, they had to convince the New Brunswick legislature of its desirability. Until the provincial legislation was passed the MFU had chronic funding problems. Their experience is typical of the struggle to survive that fisher's organizations wage when there is no system of mandatory dues collection - even when they have the backing of a majority of the fishers in an area. In Nova Scotia, approximately 25% of fishers pay to support organizations that represent the entire profession. This is not fair for those footing the bill and risky for those who don't. Non-members pay a heavy price for avoiding the cost of dues; they have no input into the positions taken by the organizations. Since DFO consults only with representatives from recognized organizations, the non-members are essentially disenfranchised. The members lose, too, as their weakened organizations are denied their rightful voice. They may sit at the table with the DFO bureaucrats, but who has the power?
What Should We Do?
In the past, efforts to duplicate the MFU's final success in New Brunswick have failed in its neighbouring provinces. At least partly this followed from the discomfort many Maritime fishers have felt with the 'union' model. Unfortunately, they have missed an important point. It may not be necessary to have a union to have a strong fishers' organization, but it is necessary to have sufficient money to have a strong organization. Attitudes have changed. On October 14, 1994, at the Halifax Airport Inn, seventy-five fishers representing different Nova Scotia fleets and regions unanimously called on the province's Fisheries Minister to move forward with legislation authorizing a dues check-off system.
A Maritime-wide system of mandatory dues collection is critically needed in order to fund effective representative organizations. Without it the proper restructuring of the fishery is problematic and a conservationist fishery unlikely. Dues collection that is tied to the federal licensing process could be instituted immediately under existing ministerial powers. There is every reason to do this now—and no excuse not to.
Fishers perform a difficult, skillful and important job. Only a 'professional' can safely operate a vessel worth anywhere from one hundred thousand to several million dollars and catch enough fish to support several families - in an environment that is often miserable and always dangerous. Unfortunately, many people from outside the industry and many within it, including many fishers, do not recognize the significance of the job.
It is crucial that fishers believe and accept that they are professionals, and that others respect their professionalism. Fishers need the confidence to insist on good leadership in order to more effectively deal with each other and the government.
Professionalization is the development of a positive attitude amongst fishers about themselves and their profession, and the expression of that attitude in how they conduct their business. This means proper education, training and experience, which should start with a public school curriculum that teaches math, science and literacy skills in the context of Maritime realities. It involves building strong representative organizations and the acceptance of minimum standards for those who are going to fish.
The finite nature of the resource has been made brutally apparent to all. The number of jobs in a rational fishery is also finite. Who will get them? Fishers are rightfully wary of DFO initiatives pushing professionalization because they seem to be more about eliminating people than improving them. We must take command of the process and define the requirements of our own professionalization.
Fishing can no longer be the employer of last resort. Skippers and crew require sophisticated skills that were not necessary a few years ago. They must be comfortable with modern technologies and electronics, fisheries science and management, and be able to cope with the ever-changing difficulties of running a successful business. It's time to upgrade the qualifications for registered fishers.
Requirements are to be established for new entrants and additional ones to allow journeymen to achieve their designation as full-time professionals qualified to hold vessel licenses. Presently, active fishers will likely be 'grandfathered' into the system, though there is a solid argument for requiring them to take special training. It would be advantageous for all fishers to experience mini-courses on general fisheries issues, the operation of professional organizations (including the rights and responsibilities of members), and basic small-business financial management.
An extensive system of increasingly restrictive qualifications is already in place in Newfoundland. It was designed not only to 'professionalize' fishers, but also to eliminate at least a quarter of them from the industry. This may be desirable there. Until now, Newfoundland had avoided the kind of limited entry that has been commonplace in the Maritimes for years. Here, we don't have too many fishers, we now have too few fish. However, many of our people do lack sufficient background to do the job as it needs to be done in a sustainable fishery.
Co-management means fishers and managers powersharing; they will have joint responsibility for directing the fishery. Co-management is an essential part of the new fishery. To be successful and cost-effective it requires the commitment and involvement of equally strong partners. The goal must be to maximize the nation's long-term benefit from a bountiful, not a marginal, resource.
For their part, fishers must accept the consequences of their actions and select strategies that minimize the potential for abuse and the cost of enforcement. Their experience on the water uniquely qualifies them to do this. DFO must refocus on its role as objective watchdog.
Speaking to the Fisheries Council of Canada (FCC) on October 19, 1994, Brian Tobin described co-management as one of the three main elements "to a new beginning in the industry." True enough. But is DFO more intent on cutting costs or on sharing power to build an intelligent fishery? To the same audience, his Deputy Minister, William Rowat, proposed the "shared management of the fisheries...[which] would lead to more industry participation, and thus reduce the need for departmental resources." A drive to cut the deficit is not the same as a commitment to share decision-making.
Nevertheless, the major players finally agree that 'co-management' will be part of the fishery of the future. A long-awaited first step, to be sure. Some hard questions remain unanswered: What will it look like? What will it do? When will it happen? Will it come too late for us to find out why it is more palatable to force thousands out of work, than it is to force a few hundred to change how they work?
How Co-Management Can Help
Fishers want co-management so they can avoid the absurdities of the past. Gross management mistakes not only cost us fish, but also cost us potential profit on the ones we did catch. We've been forced to fish under umbrella regulations devised by bureaucrats ignorant of the financial and technical realities of catching fish. Abuses have been encouraged, rather than discouraged, by poorly devised regulations (e.g., ones that only allowed the landing of unprofitable quantities of fish). If the Maritimes are to enjoy the greatest potential return from the fishery, the potential economic impact of every pound of fish must be realized.
In the aftermath of the Shelburne Blockade of July 1993, the SW Nova Fixed Gear Association instituted a variable trip limit plan for its longliners that reflected the different operating characteristics of the boats in its fleet. Skippers could choose the fishing schedule that matched their operation, enabling them to maximize the net return from the trips they were allowed to make. As a result, the total net return from the overall quota was maximized. It's important to note that this was done within the framework of a competitive fishery and that it avoided the costs and consolidation of an ITQ (Individual Transferable Quota) system.
Co-management can improve the administration of the fishery in several ways. The direct involvement of fishers as decision-makers will require them to be fully informed about the issues at hand. It is more difficult to defend a narrowly selfish viewpoint when you are a decision--maker, than it is when you are excluded from the process. A broader view of the situation will inspire fishers to take a greater responsibility for the resource. And, who can say? Maybe our co-managers at DFO will similarly expand their worlds by making a few trips on fishboats.
Let's hope that budget cuts aren't DFO's only incentive to support co-management. That said, it should save the Department money. Enforcement costs should definitely be reduced. There will always be poachers. However, the overwhelming majority of fishers will obey regulations that are rational and workable. In fact, they will be active partners in enforcement if they feel they are protecting 'their' resource. Co-managed fisheries will encourage fishers to protect the resource their communities rely upon.
Traditionally, this was the case. Fishers were tied to communities and communities were tied to territories. Even distant-water fishers referred to grounds they fished year after year, and the fish on them, as their own. Many have lost that connection to particular areas and fish as general mobility has increased and territorial control consequently decreased. The present management system speaks mainly from Ottawa, entrenching a feeling of non-responsibility and selfishness: They're not mine to look after, so I might as well take as many as I can. Although there are broad issues in the fishery, such as sustainable technology and property rights that need to be determined from a national perspective, decentralized co-management will help reestablish a sense of stewardship. Fishers will take an active part in protecting the resource without suffering the disadvantages of ITQs or other 'property rights' systems. This will make the overall enforcement effort more effective and reduce the amount of expensive surveillance needed.
Fishery violations have increased exponentially in the recent past, skyrocketing costs, because the Department has not been prepared to deal with many enforcement problems on a local basis. Different areas have different conditions that produce different sorts of violations - misreporting catches may be a serious problem in one area while the dumping of undersized fish ruins another. Regulations and enforcement effort must be easily adaptable to local activities, or their effectiveness is lost and problems get out of hand. It is a sad reality that if poachers operate profitably and relatively unimpeded, then normally law-abiding fishers will imitate them in order not to lose income. The Souwest Nova illegal lobster trap mess is a twenty-five-year case in point.
The advent of trap limits in the 1960s encouraged many fishers to increase the number of traps they fished. Some unscrupulous fishers realized that if they snuck out more traps than were allowed they would gain a significant advantage over other fishers. DFO did not adequately enforce the limits by catching and severely punishing the first poachers. Acquittals and light sentences in some early cases taken to court didn't help either. In time it became common knowledge that fishing illegal traps increased your income without putting you in serious jeopardy, and more and more fishers started poaching. The early protagonists upped the ante by putting even more illegal gear out to maintain their 'normal' share of the catch and a vicious cycle of increasing violation was set in motion. An overwhelming majority of the District 34 lobster advisory committee repeatedly insisted that DFO squash the problem. After the number of violators had risen dramatically, the Department finally admitted the extent of the problem, but said it was beyond them at that point to eliminate it. They claimed their own regulation was unenforceable. Not surprisingly, the number of illegal traps then mushroomed - the worst offenders were fishing four times the legal limit.
More than twenty years after the regulation was put in place, the Department decided to make a real push to get the illegal gear out of the water. At first, the increased enforcement showed little effect - a lot of time and energy was spent for a negligible return. As well, the concentration of policing in District 34 robbed other areas (e.g., District 33 to the eastward) of proper enforcement and their rate of violation went up. Eventually, the continued effort in 34 began to payoff. During the last couple of years, fishers have been landing untagged traps 'voluntarily' out of fear of being caught and heavily penalized. What are the costs of over two decades of lax enforcement? They include: a lot of potential profit spent on extra gear that produced only a marginal increase in the overall catch (the exploitation rate of the fishery is extremely high even under legal operation); teaching at least two generations that flaunting the law is an acceptable practice; and, a serious increase in the illegal trap problem in other districts (the cycle lives on).
Under co-management, DFO Science Branch, which has been a part of the hierarchy so often at odds with fishers, will become a more independent agency. It will supply information to all co-managers on an equal basis. The scientists will not be working for one side in a confrontational process and should, therefore, feel less pressure to deliver assessments that cannot be adequately justified.
The new independence of the scientists will also encourage fishers to cooperate more with them. It will eliminate the fear that information given to scientists will be used by management to prosecute violations. In the past, this has helped prevent an accurate accounting of discards, distorting catch figures significantly. Increased cooperation between fishers and scientists will provide the scientists with accurate data which will increase the effectiveness of their work, and cut the cost of it.
Decentralizing the management process will also be cost-effective by reducing duplication and speeding problem-solving. Modern telecommunications are a handy thing, but many problems require on-site expertise and personal negotiation, providing a flexibility in management that has been sorely lacking under the present regime. It is expensive and impractical to ship fisher's reps and managers back-and-forth to Ottawa on a regular basis. In fact, there is little need for this. Questions of regional impact can be handled at the regional level, if DFO's regional headquarters are adapted to real powersharing co-management.
More localized matters can be dealt with at the local level between co-managers who are most acquainted with the particular conditions. Fisheries vary from area-to-area and year-to-year. Environmental conditions affect spawning times and dispersal patterns, for example, and fishing activities would be more intelligently controlled by taking these variations into account. This can only be done by scientists and co-managers who are on location - anticipating problems and dealing with them as they arise.
5. Fishery Economics: Whose Money Is It?
"What we need to do is return the fishery to its traditional role. And its traditional role in rural Atlantic Canada was to provide the economic wherewithal to sustain rural communities." Brian Tobin, Minister of Fisheries and Oceans, from a CP story, April 12, 1994, Halifax Daily News.
The economic benefit of a renewable resource industry like the fishery should not be measured primarily by the percentage earned on the capital invested. Self-sustaining, family-supporting jobs are the most important return ('entrepreneurial profit') of an industry based in scattered, coastal communities. These communities are thereby self-supporting and contribute wealth to the nation, rather than take from it.
A properly regulated private enterprise system is productive, profitable and efficient. Competitive business should only be controlled in order to eliminate abuses to the environment, society or individuals. Our aim in the fishery is to encourage competition for its productivity gains, without allowing it to destroy the renewable resource. History has shown us that this can be done.
This region had a much sought after natural treasure. It's been wasted, but we can get it back. If we are smart enough to recover our resource and use it wisely, we can be shrewd enough to trade it for a lasting stake in the global economy.
5.2 Processing and the Fishery
We have two industries - the fishery and fish processing - which do share intimate ties, but are inherently different. Each industry requires a special mentality to succeed. Fishers respond foremost to the challenge of the hunt in a natural environment. Processors produce goods to satisfy a market that has its own logic. The former thinks first of what can be gotten; the latter, what can be gotten rid of. Their vocabularies mimic the difference: fishers talk about 'fish,' processors of 'product.'
Both the fishery and fish processing need competition to be most productive, but their contexts are different.
The fishery 'interacts' directly with a vulnerable renewable resource. Fishers are reminded constantly of the fragility of the resource by the need to shift grounds as fish are 'caught up.' We have learned that the improperly controlled taking of fish is detrimental to the ecosystem and our long-term economic well-being. There is definitely a limit to the sustainable catch, variable and unpredictable as that is, by any particular vessel or all the vessels in a rationally structured fleet.
Although we compete against each other, the physical dangers involved and the common source of our wealth create a collective spirit, as long as we believe we have an equal opportunity to succeed. Clearly, wide-open competition in the industry must be tempered in order to conserve the finite resource.
The fishery can be organized to ensure the health of our natural and economic worlds by regulating how, where and when we fish. Rational co-management would monitor the fleet and use flexible management options to keep fish catching capability in line with the resource. Under such a system the largest number of fishers that is economically viable within conservation limits can compete in a remunerative fishery that sustains the productivity of the marine ecosystem.
In contrast, the fish processing industry should be removed from direct interaction with the resource; the ownership of fishing boats by processors needs to be eliminated. Therefore, there would be no resource protection argument for regulating fishplants, and the processing industry would be treated essentially like any other manufacturing industry. The number and ownership of fishplants would not need to be controlled beyond the preclusion of monopolies and other structures that inhibit society's economic productivity.
Competition, which the businessman regards as destructive, cut-throat, and ruinous, may actually be the only way to get the redundant plant capacity into operation or to discourage its maintenance. (Having made the mistake of building the plants, society ought not to add the further error of failing to use them to best advantage.) Losses or subnormal profits is the free-enterprise way of discouraging excess capacity, brutal as that may sound.
The processor must deal with the 'commercial' realities of the market. The market wants a stable, consistent supply even though natural restrictions make that impossible. Processors must satisfy the beast sufficiently or lose their customers to competitors. There is a strong incentive for them to acquire product, no matter what, to meet the market's demands. The tendency is to think of 'product' as unlimited. This mentality produced the 'shopping lists' that dragger skippers were handed by their shore-based bosses. a practice which caused large-scale dumping.
'Fish' are limited. A rebuilt fishery, balanced between inshore and offshore vessels, will supply processors regularly within the constraints of a sustainable resource. Both industries will have to learn how to profit without the destructive catches of the past. In a freely competitive processing sector, not warped by government bail-outs or subsidies, well-run independent plants would be the order of the day. Society as a whole would be the final beneficiary of a revitalized industry.
Based on his experience with the Norwegian fish industries and their recent crisis, Svein Jentoft criticizes the development of large-scale industrial "mono-cultures." He describes them as "too specialized and too vulnerable in times of crisis" and recommends:
An industry which is based on fluctuations as the norm...will give priority to small enterprises, versatile production and varied market niches."
The next few years are going to be tough for both fishers and processors - the stocks need time to recover. While the catch slowly increases in response to intelligent co-management, positive action can be taken to improve the economic situation. New and better products can succeed on the market if they are properly presented under a long-term strategy. Fishers and processors must see themselves, despite their differences, as parts of an interrelated and continuing enterprise - not as antagonistic, short-term profiteers.
Together we can educate the market to appreciate quality. Our seafood products are inspected to protect the health of the consumer. An ambitious fish processing industry would upgrade this minimal inspection much as the red meat and poultry industries did in order to broaden consumer acceptance of their products. It would adopt a uniform quality grading system to inspire consumer confidence in seafood products and increase the demand for them.
The system would delineate between fresh and frozen products, have hierarchical grades within each category, and use date stamps to limit the life of assigned grades. Labels and signage would clearly show the consumer the bases for the different grades, the conditions under which the product must be held to maintain its grade and explain the justification for graduated pricing.
Product grading would be finalized at the processor's shipping door with follow-up checks at wholesale and retail points. Given a competitive supply system for raw fish, the prices paid fishers will reflect the product grade their catch can achieve. The system would reward those who attend to quality-enhancing practices and penalize those who don't. In the mid-1980s an eighteen-month North American dietary fad increased continental seafood consumption by one pound per capita - almost 300 million pounds of finished product - driving prices to new highs despite increased supply. Our future prosperity lies in attracting the consumer with guaranteed quality products that maintain an increased demand. Seafood is unique - we must capitalize on that specialness, not lower it to the common denominator of pork bellies.
5.3 Owner-operator vs. Vertical Integration
'Owner-operators' are fishers who own the licensed vessel on which they fish—that is, they own the boat and have been assigned by DFO the privilege to catch fish with that boat. Owner-operators tend to be more protective of the resource than hired skippers due to their greater personal and financial stake in the industry. The predominance of owner-operators has been a long-standing, integral part of fisheries policy because it promotes conservation practices and their local enforcement.
For centuries Maritime small boat owner-operators lived a dual life. They were self-employed independents on the water and peasants under the thumb of the buyer when they brought their catch back to the wharf. Even good catches could not compensate for the ridiculously low prices being paid and fishers scraped by on subsistence incomes. They commonly had to rely on the 'company store' to carry them through slack times, assuring their continued dependence on the buyer who took their fish.
Their poverty and cultural upbringing - shaped by a class society, rural isolation and a lack of education - worked to keep these owner-operators unorganized and, therefore, powerless in dealing with the processors. They felt trapped by their circumstances and compelled to sell their fish for whatever price was offered.
Experiences such as the 1939 Lockeport Lockout reinforced the fatalism in many coastal communities. Fishers and plantworkers in the South Shore town fought bitterly against the collusion of government and the fish companies in an unsuccessful attempt to improve their desperate financial situation. As a result, several subsequent generations believed that organizing themselves was futile: You couldn't fight for decency and win. This attitude has undercut the broad support independent professional organizations have needed to adequately represent their constituencies.
Over the past twenty years the feudal link between fishers and buyers has in the main disappeared. Better education and a pervasive media have fostered a broader outlook on the world. Fishers have been more open to alternatives to the company store, and independent buyers have been quick to take advantage of this change. The competition amongst buyers has driven up prices, and fishers' increased incomes have pushed them into the middle class. They now enjoy a lifestyle that only the rural aristocracy could afford thirty years ago.
There have been owner-operators in all fisheries, but they have been most common in the inshore. In the Gulf Region, the 'bona-fide' policy has worked quite well for years. The policy established basic qualifications to hold certain fishing licenses and formalized inshore fishers' traditional multi-species accessso they would have the flexibility to make a living, given the vagaries of fishing. Even in times of abundance it is useful to be able to target different species from season-to-season and year-to-year depending on prices and the amount of local effort.
DFO recognized the benign character of the large 'inshore mixed fishery' fleet under Recommendation 19 of the 1989 Report of the Scotia-Fundy Groundfish Task Force (known as the Haché Report):
This is a labour intensive low cost groundfish fishery which can yield a decent living for many fishermen while consuming relatively little of the TAC.
It's crucial to note here that an owner-operator should be the 'true owner' of the operation - fishers who have made the commitments to have their own rig. The concept of 'true owner' is a legal one that defines the owner of an asset as the person who controls its use, which is not necessarily the same as the person whose name is on a piece of paper. Boats that are fished by 'hired guns' in order to circumvent the rules, are not owner-operated and a growing problem.
DFO has superficially supported 'fleet separation,' a pro-owner-operator policy, for some time. Unfortunately, they have failed to adequately enforce it. For example, the policy has been openly flaunted by processors who have bought into purse seiners and draggers, and investors who own several lobsterboats. Despite DFO's protests to the contrary, the policy is enforceable given the mandate of the Minister to conserve the resource, his extraordinary powers (i.e., to require documentation before issuing a fishing license under Section 8 of the General Fishery Regulations), and the expertise of Revenue Canada investigators for tracing 'true' ownership through layers of cover.
Although fisher owner-operators have moved from the peasantry to the world of small-business, their hard-fought independence is about to disappear. The big companies want it all. They are buying and lobbying their way to monopolistic 'privatization' of the industry; and they have important supporters in DFO. The independent buyers are being squeezed out and with them the limited leverage independent fishers have had to obtain fair prices for their fish.
In the Maritimes most offshore fishing vessels have been financially tied to processors. Fishplants subsidized by Canadian taxpayers have bankrolled the larger, more expensive boats in order to control the price and availability of their raw product. These 'vertically-integrated' companies - those processors who own fishboats - like to talk about their need for a 'continuity of supply.' They claim they won't get the fish they require to operate profitably without controlling the fleet that supplies them.
What's the reality? They won't get fish at the bargain basement prices they have been accustomed to paying their own boats. They had a subsidized, unsustainably cheap and continuous supply, and they still went bankrupt periodically. What really is their problem? Processors committed to the well-being of the communities that house them would get the raw product they need from a fleet of owner-operated vessels. Most fishers prefer to sell their catch to people they know, trust and have done business with on a regular basis - and, regardless of the size and mobility of the vessel, to a processor that is handy to their home port. Assuming reasonable prices are offered, independent fishers have great incentives to sell their catch where it will benefit their families and neighbours who work in the plants.
The complete separation of fishing vessels from the control of processors would also protect the interests of coastal communities, helping the regional economy. Fishplants would have to be good neighbours with a clear commitment to their communities in order to secure the cooperation of the workforce and the supply of fish they need.
Given current fish prices and a reasonable supply of fish, individuals can own and operate offshore vessels that cost many millions - a common practice in the United States. This would mean that an ambitious fisher could graduate from being the owner-operator of a small vessel to the owner-operator of progressively larger ones rather than buying a number of small boats to be operated by other people, as has been often the case under the present system.
Fishers supply the raw material for a billion-dollar processing industry, and deserve a fair return for doing a dangerous and difficult job. This can best be ensured by across-the--board owner-operator regulations. Consequently, processors would have to compete on the open market for their fish. Some view this as a problem. We see this as the best means possible to reward productivity and enhance the economic impact of the resource.
5.4 Rational Competition vs. ITQs
Oligopoly is a term that refers to an industry controlled by a few firms. Oligopolies resemble the behaviour of monopolies to such an extent that commonly the term monopoly is used "to cover both pure monopoly and oligopoly" in order "to conform to everyday language."
Monopoly (1) A market in which the number of sellers is so few that each seller is able to influence the total supply and the price of the good or service; (2) a major industry in which a small number of firms control all or a large portion of its output.
(Note: For simplicity's sake we use 'monopoly,' which technically refers to industries which are primarily sellers, to also mean 'monopsony' and 'oligopsony' which refer to industries characterized by a limited numbers of buyers.)
Further on the subject of monopolies and oligopolies, it is important to realize that:
Conditions in oligopolistic industries tend to promote collusion, since the number of firms is small and firms recognize their interdependence. The advantages to be derived by the firms from collusion seem obvious: increased profits, decreased uncertainty and a better opportunity to control the entry of new firms.
Over the past two decades DFO has promoted 'privatization' schemes for Canada's marine resources. Privatization refers to the conversion of public or 'common' property (in this case, fish) into what is essentially private property. A resource that has been competitively available to all licenseholders is divided amongst certain licenseholders. The owners of these 'property rights' can then choose to catch the fish themselves, lease the right to catch them to others or sell that 'right.'
These schemes were devised by managers desperate to restrain the overcapitalization in fleets using gears like draggernets and purse seines. They blamed the 'overcapacity' of the fleets for encouraging the 'overfishing' that caused biological and economic damage. Sometimes managers have had to coerce a fleet into accepting 'privatization,' but more recently they have been supported by certain industry financiers who have seen the opportunity to acquire effective monopolies of traditionally common resources.
These private sector 'monopolists' have often favoured the use of destructive gear types for their short-term profit advantage. The long-term reduction in overall economic return from the use of destructive technologies does not seem to bother them. They appear uninterested in operating for the long-term benefit of the society whose resources they abuse. To date DFO has assigned property rights in 40% of East Coast fisheries, futilely attempting to correct wasteful practices (for example, the Enterprise Allocations and Individual Transferable Quotas for the Atlantic Coast dragger fleets). John Angel, architect of the ITQ system for the Scotia-Fundy dragger fleet, admitted at a panel discussion on fisheries management sponsored by St. Mary's University on March 18, 1994, that the ITQs had been a "dramatic failure" from a conservation perspective. He and other high-level DFO managers and scientists have detailed the extent of the failure of 'privatization' to reduce overfishing in a comprehensive report issued in 1994.
The 'Real' New Zealand
In recent years, the Department likes to refer to the New Zealand model as a success story of privatization. Evidently, they don't read their own studies. In "Enforcement Under the New Zealand Fisheries Quota Management System" prepared for DFO by Meltzer Research and Consulting in May 1991, we find:
Despite the ITQ system's emphasis on property rights and the interest of each quota holder to respect their personal allocation of the TAC, it appears that New Zealand fishers' behavior has not been modified by the new management regime. Fishers still try to 'beat the system' in various ways. (It's good to keep in mind that almost all the fishers referred to work for large companies).
The consultant further reports on the same page the failure of modifications in the ITQ system to combat dumping and overfishing. It was the opinion of many of those interviewed that the use of "methodologies which target species more effectively would be preferable" to the ineffective attempts to stop abuses under the system.
Meltzer points out the extensive concentration that has taken place in the industry on page thirteen. "The New Zealand commercial fishery has been consolidated under QMS [ITQs] with five major quota holders in the inshore and three major participants in the deepwater fishery." She continues:
It is estimated that 80 percent of the New Zealand quota is held by 10 percent of the quota holders with 20 significant quota holders in total. These major quota holders are fully integrated companies - they fish, land the catch, process and sell the product.
Meltzer blames the consolidation within the industry and government ineptitude for posing "fundamental problems for quota monitoring compliance."
Recently, a former DFO scientist who helped set-up the New Zealand system wrote that in her view ITQs do not make quota holders opt for conservation. This reinforces a conclusion on page twelve of the Report by Angel et al. that although Individual Quotas may relieve some pressure to discard, nonetheless "the incentive under quota management to highgrade smaller, low-value fish or to discard catches of restricted species remains."
Lastly, we have the opinion of Percival Copes, prominent Canadian fisheries economist from the West Coast. He concludes that ITQs may have some usefulness, but they have problems:
1. Fishers evade IQ limits as much as any others; 2. There is always an incentive to exceed quotas; 3. There remains a strong incentive to highgrade; 4. ITQs are hard to enforce in large fleets and when there are many landing ports; 5. Cheating on quotas leads to misreporting and consequent errors in assessments and management; 6. ITQs are impossible with a fishery based on the recruiting year-class (unless that year-class can be accurately predicted in advance); 7. ITQs are hard to manage in a multi-species fishery; 8. They do not stop 'the race to fish' in fisheries like the lobster fishery where the catch rate changes through the season; and, 9. The whole financial benefit of the ITQ system is taken by the initial ITQ holders as everyone else must buy their way into the system.
Privatization failed to protect the Canadian offshore and inshore groundfish resources from the destructive practices it was designed to eliminate. It likewise failed to stop destructive and wasteful practices in New Zealand, and the word is that things aren't going so well in Iceland. Strange, isn't it, that DFO continues to favour extending privatization to other fisheries in the Maritimes at the same time it downplays the advantages of available alternative management strategies and technologies which are sustainable and employment generating.
5.5 Stability for Our Communities
So, who does get the money?
Does it go to corporate shareholders who live in Toronto or New York or Halifax? To those who expect the 20% return that accountants tell them they better get on an investment in a volatile industry like the fishery? Or, does it go to the people who make the whole thing work - the people who catch the fish - and their families? The people in the coastal communities of Atlantic Canada. The people who invest their 'profit' in food, trucks and fridges.
Since before World War II, hook-and-line fishers and the processors they supply have insisted that the fish would not survive the waste of the draggers. They were not heeded. Now, everyone's worst fears have come true and those who predicted the collapse remain frustrated, while those who denied it could ever happen have maintained their influence. The views of organizations such as the Fisheries Council of Canada (FCC) and the Seafood Producers Association of Nova Scotia (SPANS) continue to surface as DFO policy.
Most strikingly indicative of this influence is the corporate sector's success in convincing top DFO bureaucrats that the fishery should be structured to operate non-competitively. The offshore scallop and lobster fleets are monopolistically consolidated and the 'privatized' dragger groundfishery eliminates jobs almost as fast as it destroys stocks.
The history of the 'privatized' East Coast herring purse seine fleet is interesting. It reads like a case study for the groundfishery. First, processor-owned seiners decimated the stocks in the late 1960s and early 1970s by grossly overfishing for the low-value fishmeal market. In an attempt to control the abuse the seiners were split off from the fishplants, and the fleet was 'privatized,' that is, given 'rights' to most of the remaining fish. The dominance of the seiners in the marketplace enabled them to keep the fish price low enough to drive out thousands of owner-operators in Nova Scotia that were struggling to stay in the reduced fishery. Concurrently, many of the seiners were sold back to the processors. Today, the forty or so seiners are effectively the only boats fishing for Atlantic herring. We are saddled with vertically integrated corporations and 'privatization' programs that are monopolistic, concentrating the fishery without protecting the resource. This contradicts common sense and the most elementary rules of economics. Monopolies are inefficient and less productive for society than regulated competition. However, they do make a few individuals very rich at the expense of all the rest of us.
Over the past forty years the Canadian public has spent billions on a mismanaged industrial system that has destroyed their fish. They deserve not only a true accounting of the disaster - where did their money and the fish go? - but also the right to determine the priorities for the future fishery. They want the money drain to end; the industry must carry itself. The fish must be allowed to recover to a level of generous abundance - and be maintained there. The Maritimes need to recover their financial independence. These are achievable goals.
However, neither we nor the public will determine who gets the fishery and the money to be made from it. The Minister of Fisheries will. By the spring of 1995 he will set the course of the industry for well into the new century. We need his help in the struggle to stabilize our communities and preserve a unique way of life.
As Bill Williams, a long-time fisher from Lockeport, Nova Scotia, recently wrote him: "You could go down in history as the greatest Minister of Fisheries this country has ever had, IF you have the courage."