First of all, I've been in front of the committee several times, but for the new members, my name is Cal Hegge. I'm the assistant deputy minister of HR and corporate services. One of my responsibilities, obviously, includes small craft harbours.
I'm joined today by Robert Bergeron, who's the DG of small craft harbours in the national capital region headquarters; and Micheline Leduc, who is, for lack of a better description, our chief engineer. Micheline is quite involved in all of the maintenance issues with the small craft harbours and has been with the program for a number of years.
First of all, I'd like to acknowledge the new chair. Mr. Chair, we congratulate you on your appointment.
I'd also like to acknowledge the new members, Monsieur Lévesque and Mr. Allen, who I've had the pleasure of meeting. We look forward to continuing our important work with SCOFO and, in particular, on small craft harbours.
I do bring regards from our new deputy minister, Michelle d'Auray, who, as the chair mentioned, couldn't be with us today, unfortunately. But she will be here, I guess, in December, and at the wishes of the committee. I can tell you, as an aside, that she has a very keen interest in this program and considers it to be a very high priority within the department.
What I'm suggesting we do today, Mr. Chair, is not particularly novel, but to re-present the deck we used for the committee last May. It has been updated somewhat, and it might serve to refresh committee members with some of the challenges of the program.
I will go through the deck fairly quickly, because, as I said, it's not new to most of the members. I believe this is in the context of the particular study the committee is going to continue with. And I note with interest that on Wednesday you will have before you a couple of our regional directors from small craft harbours, in continuation of the regional presentations you started.
I believe the deck has been distributed.
I hope that you have the French version too.
I will speak primarily to the English deck.
On the second slide we have the presentation of the small craft harbours budget, which, as you can see, this year is roughly $99 million. It will be reduced next year and subsequently. I shouldn't say it will be reduced--we're always hopeful we'll get some additional funding--but as the situation currently stands, we're projecting the budget for next year would be about $94 million.
I have just a couple of points to explain the difference. I think this is information that has been in front of the committee before. You will know that we did receive some additional funding through our transformational plan. For small craft harbours, $11 million was allocated for last year and this year. That drops to $8 million next year and subsequently, which explains $3 million of the difference.
As you will note from the third footnote, we are losing $2.2 million that had been dedicated to a special project with respect to aboriginal harbours, so that explains the difference.
It's always a bit confusing when we talk about departmental enablers. The way to look at that, I guess, is to focus primarily on the bottom lines and not get too engaged in the enablers, because they're not part of the small craft harbours budget per se. We allocate our enabler functions to all of our program areas. The figures you see there attributed to the enablers don't increase the amount of money available for the program. That's simply a portion of the support costs, if you will, to the small craft harbours program. And we do that right across the board in our other program areas as well.
On page 3--and I'll come back to each of these program issues in subsequent slides--we have identified the key program issues, all of which I think are fairly familiar to this committee.
We have an ongoing maintenance shortfall in our budget to maintain our core fishing harbours, of which there are approximately 750.
The harbour authorities on which we depend very heavily and with which we have a close partnership are increasingly being affected by fatigue, and they obviously need further support. I'm aware that the National Harbour Authority Advisory Committee actually met with this committee on March 22.
We also have an issue with ongoing divestiture of our non-core fishing harbours and recreational fishing harbours. Again, we'd like to accelerate the pace of divestiture.
And last but not least, I think this committee is aware that Nunavut has established a requirement for seven small craft harbours, which we feel is a legitimate request. Unfortunately, we don't have sufficient funding within our budget to address that requirement.
Page 4 reflects our small craft harbours vision, which you have seen before. We would like to maintain the national network of harbours in good working condition, so that they are safe and reliable to meet the principal needs of the commercial fishing industry. We would like to have these harbours managed by independent, strong harbour authorities.
Our longer-term vision is to see these harbour authorities increasingly take up responsibility commensurate with resources and training and development for the harbour authorities so they can contribute even more to the minor maintenance activities and in fact eventually provide increasing financial contributions to the maintenance of their harbours.
Moving on to slide 5, as you are aware, we did a study of the condition of the core fishing harbours back in 2002, which basically confirmed our suspicion that we lacked financial resources to maintain the harbours in a safe, reliable condition. We have updated these figures a couple of times. The bottom line, as you can see in the final bullet, is that we have a funding gap on an ongoing annual basis of $32 million this year, which will increase to $35 million because of the difference between the $11 million and the $8 million, which I explained earlier. So this is an ongoing shortfall that we require to enable us to not only maintain the harbours, but to recapitalize them as required.
Turning again to the harbour authorities, as I said earlier, we depend very heavily on this partnership, which we think functions quite well notwithstanding some of the pressures and the resource shortfall. There are about 5,000 volunteers who are a part of the harbour authority chain, and they generate approximately $11 million towards the maintenance of the harbours. It has proven to be quite effective and responsive, but obviously we need to provide them, or would like to be able to provide them, with more ongoing support. We do what we can through various training and the provision of tools, but clearly we would like to be able to provide some more financial resources to address some of the fatigue and other issues with respect to harbour authorities.
To enable us to generate more revenue through the harbour authorities would require, of course, bringing up the condition of the core fishing harbours to a better condition than they are now. It's very difficult to argue that they should be generating more revenue when the condition of the harbours is such as it is. Nevertheless, we do have a strong partnership. I think some of that came through in the presentation that the harbour authorities made to you last March, and we will continue to build on the strength of that partnership.
Moving to slide 8, where we talk about the divestiture issue, we still have about 340 harbours to divest. The distinction I want to make there is that these harbours likely will entail cost implications. We do have a number of harbours that are in various processes of being divested that are not going to require any additional spending by the department. The way to look at that 340 total is basically harbours that we have not really been in a position to spend money on to start the process.
This is slightly improved from the presentation I delivered to you last May, which reflected 354 harbours, so we are making progress, albeit on a modest basis.
As you can see, we dedicate $1.5 million of our limited budget toward divestiture. That's basically all we can afford, given the other funding pressures experienced by the program.
As you'll see on slide 9, a figure that has been in front of this committee before, we estimate that if we could get an additional $82 million over a five-year period we would be able to finalize the divestiture of the remaining harbours.
Turning to the Nunavut harbours, I believe the committee has seen the report we worked on with the Nunavut government, which basically builds a rationale for seven fishing harbours in Nunavut to assist their growing fishing industry and to contribute to the economy of their government. Unfortunately, if you look at the cost associated with the construction of these harbours and the ongoing maintenance requirements, which are reflected on slide 11, given the nature of the budget and the pressures on the existing budget, we simply do not have any additional resources that we could provide to the construction of these harbours. We are hoping to solicit some additional sources of funding to be able to advance the construction of these harbours.
Finally, turning to what we call program delivery or internal management, if you will, on slide 12, we've been doing some things within the department to improve the efficiency with which we deliver the program. We've been working, for example, with Public Works and Government Services Canada on finding more efficient ways to administer and manage contracts, again, with training to delegate more responsibility to the harbour authorities in this regard, which we think will achieve savings in the long run.
Through our functional review, which is coming to a conclusion this fiscal year, we are looking at the distribution of resources we have across the country with respect to our regional operations and looking at ways to level the playing field a little bit more in that direction. After the review and its recommendations are finalized then we will be developing an implementation plan, which we'd like to launch early next fiscal year.
That concludes my presentation, Mr. Chair. We'd be happy to do our best to address any questions the committee might have.