FOPO Committee Meeting

STANDING COMMITTEE ON FISHERIES AND OCEANS

COMITÉ PERMANENT DES PÊCHES ET DES OCÉANS

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, November 3, 1999

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[English]

The Chair (Mr. Wayne Easter (Malpeque, Lib.)): We'll call the meeting to order. We don't have a quorum, but while we're still waiting for some others to come I'll mention a couple of points.

First, I would apologize to the witnesses for being late myself and report to the committee that the House passed the order of reference for this committee to travel November 21 to 28 to examine the east coast fishery as a result of the Regina v. Marshall decision and its implications on fisheries management in Atlantic Canada.

Spinning off that, the clerk will be contacting your offices tomorrow through till Monday to get a list of potential witnesses you would propose for those committee hearings. Then the clerk can get down to planning that set of hearings to its full extent.

Mr. Charlie Power (St. John's West, PC): Mr. Chair, are we going to Newfoundland?

The Chair: That was not in the order of reference, but it would be possible if there are witnesses from Newfoundland for them to come to Halifax or one of the other locations, or indeed to come to Ottawa at a later date, Charlie. It was Nova Scotia, New Brunswick, P.E.I., and Gaspé in the order of reference.

Mr. Charlie Power: I presume there's nothing to prevent us from going to Newfoundland if the situation demands it at some future date.

The Chair: At some future date. The difficulty this time around is the House liaison committee is not up and running either.

Mr. Charlie Power: Okay.

The Chair: We also have, before we go to witnesses, a letter here from British Columbia, Minister Streifel's office.

Do you want to read this, Bill? I'm not even supposed to use my voice these days.

The Clerk of the Committee:

Mr. Streifel would like to appear before the Select Standing Committee on Fisheries and Oceans on Thursday, November 4th, 1999.

The Minister would like to address the Committee on the subject of the crisis facing fishing people of British Columbia due to the compounding problems of three years with no—

Mr. Yvan Bernier (Bonaventure—Gaspé—Îles-de-la-Madeleine—Pabok, BQ): Please speak more slowly.

The Chair: He's even faster than an islander, Yvan.

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Mr. Charlie Power: Which island?

The Chair: There's only one island, Charlie.

The Clerk:

The Minister would like to address the Committee on the subject of the crisis facing fishing people of British Columbia due to the compounding problems of three years with no access to the resource.

We apologize for the short notice of this request, as we are aware of the Committee's busy schedule, but the crisis in British Columbia is pressing.

And if the committee does agree, he'll be available tomorrow during the time we have the Sockeye Crisis Committee to appear. He would like to know today if the committee will accommodate the minister.

The Chair: Any discussion? We do have, I believe, two witnesses on. Tomorrow we have the Sockeye Crisis Committee and the British Columbia Fisheries Survival Coalition. And he would sit in with the Sockeye Crisis Committee?

The Clerk: Yes.

The Chair: Are there any problems with that? None? Okay, then we will do that. Thank you.

Mr. Bill Gilmour (Nanaimo—Alberni, Ref.): On a point of order, Mr. Chairman, I would like to point out that my island is bigger than your island.

The Chair: You're right. I'll concede that point, Mr. Gilmour.

The order of the day is pursuant to Standing Order 108(2), a briefing on the post-TAGS review.

Witnesses are here from the Department of Fisheries and Oceans and the Department of Human Resources Development Canada. I believe Mr. David Good, assistant deputy minister, HRDC investments branch, will lead off. Welcome, people.

If you want to introduce the people with you, Mr. Good, go ahead.

Mr. David A. Good (Assistant Deputy Minister, Human Resources Investments Branch, Department of Human Resources Development): Thank you very much, Mr. Chairman. We're obviously pleased to be here.

Let me introduce Ron Stewart, who is the director general of the labour market programs in HRDC. I'll ask David Rideout, my colleague from the Department of Fisheries and Oceans, to introduce himself and his colleagues.

Mr. David Rideout (Director General, Aquaculture, Restructuring and Adjustment, Department of Fisheries and Oceans): Thank you very much.

My name is David Rideout and I'm the director general of aquaculture, restructuring and adjustment at the Department of Fisheries and Oceans. With me is Lorne Anderson, the acting director of the Canadian fisheries adjustment and restructuring program.

The Chair: Thank you, and welcome, gentlemen.

I believe, Mr. Good, you have a presentation and then we'll go to questions.

Mr. David Good: Yes. I will make some opening comments and my colleague David Rideout will also make some opening comments.

Thank you very much, first of all, for inviting us from HRDC to appear before you today.

What I'd like to do is to provide just a brief overview of HRDC's efforts to assist individuals and communities affected by the changes in the Atlantic groundfish industry as well as the Pacific salmon fishery. This has been accomplished through the Canadian fisheries adjustment and restructuring measures.

Since the moratorium on the Atlantic groundfish was imposed in 1992 HRDC has been tasked with the responsibility to assist individuals and communities to adjust to life beyond the fishery. First this was through the adjustment component of the NCARP program, followed then, of course, by the TAGS program, and presently we are implementing the Canadian fisheries adjustment and restructuring measures.

Certainly the frustration and the uncertainty for those caught in the situation is very, very real, and I think it's important for us to help people to get on with their lives so they can enjoy friends, enjoy families, and eventually lead the productive lives that are very important for them.

As you know, the Atlantic groundfish strategy, TAGS, officially ended on August 29, 1998. At that time, of the approximately 40,000 clients who were initially eligible under TAGS, approximately 24,600 remained eligible as of August 29, 1998. TAGS provided an important lifeline for individuals and there was consensus that long-term solutions needed to be developed to help people and communities to move on from where they were and deal with the very difficult situations facing the economy.

The Standing Committee on Fisheries and Oceans as well as the Harrigan report recommended that more effort be placed on the adjustment and the capacity reduction activities on the east coast.

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On the west coast, individuals and communities were adversely affected due to reduced opportunities in the commercial and recreational sectors. And of course on the west coast the job commissioner's report echoed the need for more restructuring, despite salmon licence reductions.

The Government of Canada recognized the impact on individuals, communities, and provinces with the ending of TAGS and the changes that were occurring in the west coast salmon fishery.

Given the unique circumstances facing each province, and given, as was indicated very clearly in the Harrigan report, the distinct differences among communities, it became very clear that a one-size-fits-all approach was not the approach to take. What we needed was a more specific approach tailored to the individual communities and provinces involved.

So on June 19, 1998, the government announced, after extensive consultation with stakeholders and with the provinces, a five-year, $1.1 billion restructuring program on both east and west coasts. This program was a comprehensive response that included both adjustment and restructuring components. The adjustment measures were designed to provide individuals and communities with the necessary supports to move beyond the fishery.

The fisheries adjustment and restructuring budget for the east coast was $760 million, which included $30 million reprofiled from the old TAGS program. Of this, $410 million was provided for HRDC for three components: adjustment programming, final cash payments, and early retirement measures.

The fisheries adjustment and restructuring budget on the west coast was $400 million. The amount for which HRDC was responsible was $30 million, with responsibility for adjustment programming. DFO was the lead department, with responsibility for the restructuring on the west coast.

As a result of the June announcement, the measures were implemented. These measures included the final cash payment, early retirement, licence retirement, and a series of adjustment measures, which included things such as self-employment, mobility assistance, term job creation, wage subsidies, and skills development.

The final cash payments were really introduced to assist individuals to make and implement choices about their employment future. The final cash payment, as you recall, was paid in two instalments to TAGS clients whose duration would have continued after August 29, 1998. The first instalment was issued to some 22,000 eligible clients. That ended in September 1998. The second instalment, paid in the next tax year, in January 1999, was paid to some 18,500 eligible individuals.

On the east coast, some 2,100 individuals participated in the adjustment programming, and addition to that, approximately 10,300 individuals have participated in the term job creation program.

On the west coast to date, some 700 individuals have participated in adjustment programming, with 350 individuals participating in the term job creation.

The objective of the early retirement program is to assist fishers and plant workers between the ages of 55 and 64 to retire from the fishery. It's done in partnership with the provinces, through a federal-provincial agreement that calls for funding of 70% from the federal government and 30% from the province. Newfoundland, Prince Edward Island, Nova Scotia, Quebec, and New Brunswick have signed their respective agreements. To date, no agreement has been signed with the Province of British Columbia.

A total of 1,800 individuals have chosen the early retirement program.

To conclude, in the design and implementation of the fisheries adjustment program, HRDC learned some valuable lessons from the implementation of TAGS, and we put those into practice in implementing this program. In fact HRDC has been recognized by the Office of the Comptroller General for the orderly and systematic manner in which we have gone about attempting to implement these measures under the new program.

Thank you very much.

The Chair: Thank you, Mr. Good.

Mr. Rideout.

Mr. David Rideout: Thank you very much, Mr. Chairman.

Good afternoon to all.

Some time ago, both the post-TAGS review report, known as the Harrigan report, and the Standing Committee on Fisheries and Oceans recommended that more adjustment measures be put in place following the end of the Atlantic groundfish strategy, known as the TAGS program.

As the director general of aquaculture, restructuring, and adjustment, I have been involved since June 1998 in administering measures that were announced by the federal government at that time to foster restructuring and adjustment in the Atlantic groundfish industry for the period immediately following the end of TAGS. In particular, I am involved in administering the $250 million program to retire groundfish licences in Atlantic Canada and Quebec, a program administered principally by the Department of Fisheries and Oceans.

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As you know, the groundfish licence retirement program is one part of a series of measures for restructuring and adjustment of the Atlantic groundfish industry, measures having a total budget of $730 million. The licence retirement program follows on from TAGS, and is one in a series of final measures to assist fishers affected by the collapse of the east coast groundfish stocks. It was launched by the former Minister of Fisheries and Oceans in October 1998.

To date, there have been four rounds of bidding completed under the program held in DFO's Laurentian region—that is, Quebec—and in its gulf region. Fifth rounds have just been completed in our Maritimes region and in Newfoundland. New bidding rounds in all regions will commence this fall. In our view, the fact that more than 1,100 Atlantic-wide bids were received in the fourth round is a solid signal that there is continued interest in the program from licence holders.

While the current program resembles a similar program that took place under TAGS, there has been greater success in retiring groundfish licences under the program we launched in 1998. If we compare the results of the current program to the previous one under TAGS, we have removed more than three times the number of licences than we did under the previous program. Under TAGS, 520 groundfish licences were retired, at a cost of $59.7 million.

When the current program was launched in 1998, the requirement that fishers agree to exit permanently from the fishery was a contentious aspect of its provisions, and there were fears that its success might be limited because of this. Nevertheless, approximately $143.1 million of the program budget has been used to date to retire a total of 1,642 groundfish licences in the Atlantic region and Quebec.

A copy of the breakdown of licence retirements under the program has been distributed to you for your information.

Given that interest in the program is vigorous in some regions, we are continuing to run bidding rounds where funds are available and where industry support is strong.

One of the main reasons for the current program's success, apart from the fact that the prospects for recovery of the groundfish industry are not very positive, is that we structured the program to permit flexibility in its administration in the regions involved.

Another key contributor to its success is that DFO staff members have worked since the outset with industry to set the bidding schedule and to review and assess the bids received. The regional directors general worked with their regional industry advisory groups to set their own schedules for bidding rounds and developed their own strategies for assessing bids. Common criteria used by all regions have favoured retirement of TAGS-eligible, groundfish-dependent core licence holders.

I would like to say for the record that we have received comments from industry that the current program is well administered, a comment that is not always heard from those affected. We are having an independent review of the program's administration carried out and will see whether this view is validated during that exercise.

Finally, it should be noted that the groundfish licence retirement program will not affect fleet shares for allocation purposes. Any changes required subsequent to the program's conclusion would be preceded by appropriate consultations with provinces and stakeholders.

Thank you very much, Mr. Chairman.

The Chair: Thank you, Mr. Rideout.

Do any of the other gentlemen have anything to say, or will we go to questions?

Questions. I believe we'll start with Mr. Bernier today.

[Translation]

Mr. Yvan Bernier: I thank the witnesses for coming here today.

I'll start with a fairly broad question. I'm trying to sort out the avalanche of figures we have just heard. To begin, I have some questions for the people from Human Resources Canada. Please correct me if the figures I cite are not accurate.

You spoke of 40,000 clients who were initially eligible for TAGS. Now I'd like some clarification regarding the following figures.

How do you account for the fact that, of the 40,000 initial clients, only 22,000 received the first installment of the Final Cash Payment in September 1998? We lost, at the very least, 18,000 people. Since they didn't disappear from the face of the earth, I'd like to know what happened to them.

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I'll go on. The numbers drop from 22,000 to 18,500. I assume that these were people who had not worked enough in the industry. That may be the explanation. There were 18,500 individuals who received Final Cash Payments. Between the 40,000 clients on the books at the beginning and these 18,500 people, there's a difference of 21,500. I'd like to know what happened to them and whether we could get a breakdown by province. How were the initial 40,000 clients distributed among the provinces, and how many received Final Cash Payments in each province? I'd like to know what happened to those who make up the difference between the two figures.

Last of all, where are all these 40,000 clients? Are they working somewhere else in the industry? Do you know what they are doing today or should I expect that, with the end of the transitional measures, 40,000 people will take up the torch again and go into the streets this autumn? I'd like to have your impression of what you're seeing in the field.

[English]

Mr. David Good: Thank you very much for the question.

The starting number was slightly under 40,000 persons. That was at the end of TAGS. A number of those—and these were the TAGS-eligible individuals—had either adjusted out of the fishery at that point in the process, had taken on other employment, or had found other sources of livelihood. Basically what that meant was the number of TAGS clients that one had on August 29, 1998, was in the neighbourhood of 25,000: 24,625.

Of those final numbers, the way it operated was that some 23,000 of those individuals took the final cash payment. In the way the final cash payment operated, it allowed individuals to receive that with incomes up to $40,000, so anyone over $40,000 was not eligible. This was one of the refinements we worked out in close consultation with the provinces and with the unions, the payment for them being basically about $9,000.

If one took the cash payment, one then had a number of other choices that one basically had to undertake. If one were in the fishing business and decided that one did not want to continue with it, then one could opt for the licence retirement and undertake that rather than the cash payment. David Rideout has explained the licence retirement.

Those individuals who were between age 55 and 65 basically had a choice to operate. That is, if they wished, they could take the early retirement payment and receive a stream of benefits from age 55 to 65.

That left individuals who either did not take the licence retirement or did not take the early retirement. All those individuals were eligible for EI part two benefits, that's the employment benefits and measures, which include areas of adjustment assistance, mobility, job search, and so on. Those individuals have been eligible and have taken that.

To give you a sense of what the bottom-line numbers look like, approximately 22,000 persons have taken the final cash payment. In terms of the term job creation, some 10,000 have opted for that. On the other employment measures, some 2,800 have opted for various adjustment measures, be it mobility, be it wage subsidies or others. Some 1,800 have taken the early retirement option. So that in a nutshell is the broad story on the options that have been taken by the various TAGS recipients.

[Translation]

Mr. Yvan Bernier: Mr. Chairman, could we ask Mr. Good to send us a table containing the figures he just mentioned? I'd like these figures to be broken down by province.

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The big question that is hidden behind all of this—if we think of the Harrigan Report that preceded the Standing Committee's East Coast Report—is the following: what has become of the goal set by Human Resources Canada or by the Canadian government, to ensure that these workers were transferred to greener fields? Were the goals reached? Is there an analytical table that would enable us to check whether efforts were made to reach goals? What exactly is happening?

I'd like you to give me examples of what was done. To let you know where I'm coming from, I would say that I've not seen any improvement in the coastal communities that I represent. I'll give you two examples.

On the Magdalen Islands, if I travel five kilometres to the south, north, east or west, I hit water. There are no other options for diversification. Once the adjustment measures have ended, people are left with nothing.

What's being done about this situation? Was one of the goals to do something for these people? Or was the idea to hand out cheques and then turn our backs? I believe that the Harrigan Report described their situation and profile and indicated that they were really in dire straits. It's something that saddens me.

What wasn't taken into account, mainly in the case of the Magdalen Islands, is that almost 600 TAGS beneficiaries, or in other words, three quarters of them, were affected by a redfish moratorium. Redfish is the second most important groundfish species, after cod. It began one and a half years after the first moratorium.

So these people had already been excluded from the training program given in the first year. After four years—in their cases four years less one and a half years, that is, only two and a half years—the TAGS assistance ended. How can a worker with 25 years of experience in the redfish fishery be retrained in less than two and a half years? I don't know.

I'll also mention the case of the southern Gaspé Peninsula, in a village like Newport, where people were told that there were opportunities to do something else on land. You likely heard on RDI, the French news channel, that the Murdochville mine, which is one and a half hours by car from Newport, has just closed down. The Gaspesia mine has also closed, although we hope that it will reopen.

How will we go about diversifying the economy and how will it be possible to create other jobs for these workers? I'd like to have your views on this.

Were there any objectives for retraining or was it just a matter of providing financial assistance?

Mr. David Good: Thank you. You've asked a lot of questions.

[English]

First of all, we certainly can, through you, Mr. Chairman, provide a report on the breakout by province of the various programs, both in terms of the expenditures to date and the number of participants that have benefited from that. We'll break that out by province and by component in the program.

The Chair: Could I just interrupt, Mr. Good? If you could forward that to the clerk, he will distribute it to the committee.

Mr. David Good: Thank you.

The Chair: Thank you.

Mr. David Good: With regard to the progress we're achieving, let's recall, the program has been in place now a little over a year. We have a formal evaluation that will be undertaken in two phases. That undertaking of the evaluation will be at first a formative evaluation, which will examine the results we've achieved up to the end of this calendar year. We are starting a framework discussion for that, in consultation with our six other partner departments. We have worked out a memorandum of understanding, which the Auditor General has endorsed, that has set out a framework for us to do the evaluation, and we are beginning that evaluation on the basis of the first year.

Our second step will then be to do what we call a “summative evaluation” that will examine, two years from now, what the longer-term implications of the program are. So we will continue to monitor the program on a regular basis, firstly, in terms of the formative evaluation, and secondly, in terms of the summative evaluation.

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One of the key partners we are working with is the department of economic development in Quebec, and there have been a series of expenditures that were part of the overall program. In fact, there were $100 million set aside on the east coast for economic development; $6.2 million were in the province of Quebec, basically to work in partnership with the federal government—with our department, with fisheries and oceans, and with others—to look at what the longer-term economic development prospects are, recognizing that, as you've indicated, in the area of Gaspé and Îles-de-la-Madeleine, c'est très difficile and there are not necessarily the economic development prospects.

We also, for our part, have taken advantage of the transitions job fund as well as the Canada jobs fund to begin to see what initiatives we can undertake with regard to the employment opportunities outside of the fishery. So we're working in close partnership with the other departments. We are evaluating the results and we look forward to the first results coming out of our formative evaluation as a result of the work that's been done in the first year of the program.

The Chair: Is there anybody else... Mr. Bernier.

[Translation]

Mr. Yvan Bernier: When did you say that this evaluation would be done? I hope that I didn't understand the interpreter correctly. When will the short-term evaluation be done? The transition program is drawing to a close. Under the Fisheries renewal and adjustment initiative, there was approximately $1.5 million for short-term job creation and $1.5 million for training for my riding. As I said, with funding like that, there must have been objectives. Were the objectives identified and were they met?

With regard to the situation on the Magdalen Islands, I'll repeat that these people were not eligible for the first part of the training program in 1993-94 and that now they do not have access to it. The reason is very simple: although courses are available, they cannot be enrolled because of a lack of funding. And then we are told that all the money must be spent before March 31. Could you not do a reassessment halfway through the fiscal year, immediately, to determine whether there will be problems in reaching the objective if the program ends on that date and, if necessary, to ask the government to add some money? That's what we're asking because we have nothing.

Supposing other jobs or other job creation projects were to arise only next fall... For example, look at what is happening for mackerel, in the pelagic fishery, which is interesting mainly in the fall, where I come from. I would no longer have workers available to wait for this renewed activity. I'd like you to tell me whether or not there are tools for bridging up to the time of the next job creation programs, or rather the next job creation projects. We're trying to find our way, but we had to begin after everyone else because the moratorium came later. And yet, we are being abandoned at the same time as everyone else. I have serious problems with that.

I'd like to know whether an evaluation will be conducted right away because, if we wait until the end of March, it will be too late, people will be "dead meat", as you say. We won't be able to go on because they will no longer be there.

[English]

Mr. David Good: Thank you for the question.

On the question of the evaluation, we've had one year of experience with the program since it was announced. The evaluation framework has been put together and the evaluation is under way, but we need that one year experience in order to have something against which we can do the evaluation we're undertaking.

With regard to the targets, I think it's important to recognize that certainly the short-term job creation program was indeed put in place as a bridge. It was designed primarily to provide some opportunity over the short term for those people who did not have the opportunity for retraining and re-employment. In other words, those projects basically had to start within six months of the termination of TAGS and complete themselves by the end of this calendar year. That was seen as a bridge to the economic development measures that I indicated, which were part of the departments of economic development in Quebec as well as in the other provinces that assisted in that process.

With regard to the various adjustment measures that are there, that's really a question of take-up by the individuals—the individuals who want counselling, who want training and mobility. We do have provision within our funds for the continuation of those programs.

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In fact, to the extent to which those programs are not taken up in this fiscal year, it would be our hope to seek reprofiling of those funds from this fiscal year into the next, so that those individuals who want to avail themselves of those things in the Gaspé, Îles-de-la-Madeleine, Quebec, or elsewhere in Atlantic Canada would have the opportunity to do that.

The Chair: Thank you, Mr. Good.

Mr. Bernier, you've used all of your and the Reform Party's time. We may get another round.

Mr. Steckle.

Mr. Yvan Bernier: So it's the Bloc's time now?

The Chair: Is that a precedent?

Mr. Paul Steckle (Huron—Bruce, Lib.): As someone who comes from the freshwater fisheries area of Canada, I'm obviously not as familiar with the problems of the east and west coasts.

The fact that we spend huge amounts of money in dealing with the problems of people having lost their industry is not new to Canada. We have that happening in other parts of Canada today in another industry.

Was any of the money that was allocated to TAGS in the first place, or the subsequent $1.13 billion for an extension of that program devoted to both the east and west coasts, used in the buyback of licences, or was it all expended in job relocation and assisting people under HRDC?

That's my first question.

Mr. David Rideout: In terms of licence retirement, in the first go around of TAGS I think we spent in the order of about $60 million on licence retirement. We have $250 million on the east coast that we're spending. On the west coast we have a combination of restructuring measures that are in excess of $200 million. Of the total amount, about $500 million has been spent on licence retirement.

Mr. Paul Steckle: Which ministry is that money coming from? Is that coming from DFO or HRDC?

Mr. David Good: It's DFO for the restructuring money.

Mr. Paul Steckle: Is all licence retirement money coming out of DFO?

Mr. David Rideout: Yes, we're administering that program.

Mr. Paul Steckle: Okay.

The Chair: But just to be clear here, it's Human Resources Development Canada money, right?

Mr. David Good: No. If I may, Mr. Chairman, the amounts of money that were provided to deal with both east and west coasts were provided to three departments.

The money for the licence retirement was provided to the Department of Fisheries and Oceans, as David has just explained. There was $100 million over five years that was provided to the regional economic development agencies ACOA, WD, and DEC in Quebec. The other amounts were provided to the Department of Human Resources Development. That was for the final cash payment, which we've discussed, as well as for the early retirement scheme for people aged 54 to 65, and lastly, for the adjustment measures we've been discussing, which were basically to help people find jobs—to look at short-term job creation—and most importantly, to help them get on with their lives as they adjust out of the fishery.

The Chair: Paul, go ahead.

Mr. Paul Steckle: I don't have my budget papers here, so I'm not sure just how this money was allocated. Was this new money brought into DFO, or was it existing money within the budget that was allocated to this cause? If so, which areas of DFO have suffered as a result of this?

Mr. David Rideout: It was new money.

Mr. Paul Steckle: New money. Okay.

Mr. David Rideout: It was $30 million.

Mr. Paul Steckle: Okay, that answers that question. I had a reason for asking that question.

How is the value of the licences determined? How do you value those licences? If you look at the numbers, in Nova Scotia, the buybacks were less money. Is it because there was less quota per licence? What determines the value of a quota?

Mr. David Rideout: In the way that we designed the program we felt a key component was regional flexibility. Within each region, the regions established industry advisory committees that essentially reviewed the bits that came in, and determined what would be the best strategy to proceed with in terms of bids in each region.

What we found was that the various regional advisory committees have adopted different strategies, and we've accepted that. So you'll see different approaches within each advisory committee.

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The overall program is based on a reverse-auction approach that says the fishers would submit their bids to the advisory committees, based on what they think their licences are worth. The advisory committee would say it would accept or not accept that bid, and it would make a recommendation to the regional director general.

In some regions, those committees have said they think that for their regions these bids are too high, and that they're therefore going to reject them at this point. In some of the initial bidding rounds, some of the regions actually took that approach and said they thought we would see significantly lower bids in the second round, and they were right on. They were correct on that, and that was appropriate for their regions, but possibly not appropriate for another region.

So it all gets to the issue of reverse auction, regional flexibility, and an industry advisory committee making recommendations to the regional directors-general.

Mr. Paul Steckle: Did this take on a collusive approach? Was it singularly approached by each fisherman, or did a group of fishermen get together and decide they were going to offer their licences for sale? I'm asking these questions because it's a new area for me, and the quotas that I'm familiar with are dealt with in a little different way than that. I was just wondering how this one's done.

Mr. David Rideout: Each fisherman received a package, including a brochure or booklet that provided an application form if they wished to consider leaving the fishery, and we told them the things they should take a look at. One of the things that we recommended was that they seek financial advice, because this is a major sort of life decision. Based on that, they would put in their bids.

In terms of the bids, once they were received by the advisory committees, the names were struck out. It was all independent, and there was no way the advisory committees would know who it was that they were sort of making a decision on. And again, the committees were striving to get value for money, based on what they were seeing within that regional area.

Mr. Paul Steckle: Okay.

The Chair: Is that it, Paul?

Mr. Paul Steckle: Yes.

The Chair: Mr. Power.

Mr. Charlie Power: I just have a couple of questions, particularly on term job creation, David. I've heard your explanation, and I've heard it from your staff in St. John's, as well. At one point you had one $3-billion program for five years. Somehow, you arbitrarily decided that the term job creations bridge was going to get done and had to be completed by the end of this calendar year. It ended up seeing $40 million getting spent in Newfoundland last year. A lot of projects that normally might not have been funded were funded in a rush, and some of the projects weren't nearly as productive as they could have been. This year, I think we had $6 million for all of Newfoundland, and that was not nearly enough to satisfy any significant portion of the need. Why did somebody arbitrarily say term job creation had to be finished by the end of this calendar year, when you had a five-year budget?

Mr. David Good: It was not an arbitrary decision. When we were into the discussions with provinces and with stakeholders in the final design of the adjustment measures, I might add that we benefited greatly from our discussions with the union in Newfoundland in particular, as well as the unions in other provinces. We basically put together a package within the program and policy parameters, as well as the fiscal parameters that were set down to deal with it.

There was a clear understanding that the objective was really to move beyond the program that had been put in place, and to get to a better form of program that was going to help people to get on with their lives and make the very difficult adjustments that need to be made. I know you'll appreciate those and have seen them on a firsthand basis.

There was a sense that one needed a balanced package, and we described those components. Within the adjustment side, there were a series of measures put in place to ensure targeted wage subsidies, various adjustments, mobility assistance, etc., much of which is self-initiating, much of which is required for those who do have the training and potential opportunities to go on and adjust out. It was clearly recognized that in that context there were others who were facing difficult situations coming out of it, despite the fact that there was a very significant final cash payment—it was not an insignificant amount—and that one faced particular situations on the short-term job creation issue.

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A number of criteria were put down, though. The clearest sense was that given the fact that the economic development moneys would come on stream and they would be worked within the regional economic development zones, in this case in Newfoundland and elsewhere, to coordinate the programming, and that would take some time to come on stream, one wanted to put in place a proper bridge over the period of time. There was a one-year bridge. In fact it was more than a one-year bridge because the planning had actually taken place over the course of the summer, with the projects having to start within 12 months of August 1998 and be completed within 16 months.

So I wouldn't describe it as arbitrary. I think what I would say is that it was a balance that was put in place to do that.

The last thing I would add is that we would hope to seek approval from Treasury Board to reprofile those moneys that are not being expended in the fiscal year for the adjustment measures, as I mentioned earlier, so that they could be made available as people make those choices in the future.

Mr. Charlie Power: I have two other brief questions.

I'm glad you mentioned that point of the transfer of funds, because during August of this year it was obvious to every member of Parliament from Newfoundland for sure and to a lot of others that there was going to be a significant shortfall in the term job creation and that there was still a significant need. Those programs weren't just for bridging, I thought. They were also to get us closer to a fully rejuvenated fishery so that people could make their normal living. In certain parts of St. John's West and St. Mary's Bay we just didn't have that good fortune, and a lot of people were still dependent on programs.

I wrote your department and asked about the $3 million of mobility fund money that was not going to be used. I might say that HRDC has excellent management and staff in St. John's. They agreed that the $3 million was there so why couldn't we use it for term job creation. Treasury Board refused that, or somebody in government did. Were you aware of that situation? Why wasn't the mobility money, which wasn't going to be used, used in 1999-2000 for people who badly needed some work?

Mr. David Good: That's a very good question. The reality was that the requirements that were placed upon the program by cabinet were very clear. The term job creation was an envelope of separate and distinct funds to be used only for term job creation, and there was a limited amount of funds set aside for term job creation with very specific requirements.

Under normal circumstances the mobility money would have lapsed and could not have been used for anything. What we are doing is seeking to reprofile those funds so that they can be used for adjustment. But we do not have the authority in the department nor from cabinet or Treasury Board in essence to transfer funds from the adjustment moneys, which are intended to help people get on with their lives, into the short-term job creation moneys.

So those are the parameters under which we're operating. In my previous answer I tried to explain the broad rationale for why that was set out that way.

Mr. Charlie Power: I understood what happened there, but it wasn't of benefit to the people the program was designed to help.

Also, I don't know if my other colleagues from Newfoundland agree, but I don't think there has been any money approved yet under the economic development plan. It's just impossible, it seems, at this stage to get a co-op to understand that they're into a new kind of business. They are the ones who can approve or not approve this program, and not much is happening on that level.

I want to change topics for a moment. In that whole TAGS business, can you tell me how many people were fully trained for outside the fishery and at what cost? Do you know if those people are now fully employed in some part of the economy of Canada? Do you have any way of tracking that?

Mr. David Good: I don't have the answer to that question offhand. I think those are the kinds of questions that the evaluation will let us see. We will combine that certainly with the evaluations that were undertaken under TAGS and NCARP, and some of the evaluations we're now undertaking with regard to the adjustment will allow us to see that.

If one looks at the adjustment and changes, we certainly learned from the TAGS program that one has to be very clear as to not necessarily be reallocating funds from some things to others, that one has to get on with the adjustment. You will recall that was one of the difficulties under the TAGS program where, because of the fiscal pressures, a considerable amount of adjustment money was actually reallocated into income support.

Mr. Charlie Power: Thank you.

The Chair: Is that it?

Mr. Charlie Power: Yes. I have another question, but we'll get another round, I guess.

• 1630

The Chair: Does anybody over here have any questions? Mr. Gilmour.

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

Mr. Good, with regard to the early retirement, in your opening presentation you said that Newfoundland, P.E.I., Nova Scotia, Quebec, and New Brunswick have all signed the agreement, yet B.C. has not. What's the holdup?

Mr. David Good: Let me ask my colleague, David Rideout, to comment on that. The Department of Fisheries and Oceans has the responsibility on the west coast for the components with regard to early retirement. David.

Mr. David Rideout: Thank you.

The early retirement program requires federal-provincial cooperation and cost-sharing. The Province of B.C. has been considering whether or not it wants to engage in cost-sharing on this program and as yet has not come to a conclusion on that.

Mr. Bill Gilmour: Seeing that the share is 30% for the province, does the program grind to a halt, or does the 70% federal component go out? What's happening while it's still in limbo?

Mr. David Rideout: Nothing is happening until we know for sure whether or not the province wants to cost-share in the program. Once we have that decision, they will be approached to have an early retirement program. If not, then we would look at how the dollars might be used in other areas related to the fisheries adjustment and restructuring initiatives.

Mr. Bill Gilmour: Okay. Mr. Rideout, this is branching out, but I just want to get some of your expertise on buyouts, because you're familiar with them. Following the Marshall decision, we're now talking about buying out lobster leases. I recognize that we're talking about totally different situations. But if DFO is going to buy licences in an already full fishery, in your estimation how much is DFO going to inflate the price? How much is it going to distort the marketplace by going in and buying up licences for the native component of the fishery?

Mr. David Rideout: I can't really comment on what might be happening in terms of buying licences or what will in fact occur. I haven't really been involved in that file.

We've tried to find a way to ensure good value for money for the Government of Canada in the way we've managed the license retirement program, and we find that the reverse auction process is a good one. The industry advisory process has been quite beneficial. We feel we are getting value for money in the way we're approaching it. But in terms of the specifics of your question, I'm afraid I can't answer that.

Mr. Bill Gilmour: Okay. Thank you.

The Chair: Thank you.

Just spinning off Mr. Gilmour's question, if I could, with regard to the retirement money on the west coast, how long has that money basically been sitting on the shelf waiting for an agreement while people are sitting around waiting?

Mr. David Rideout: It's been there since June of last year, 1998.

The Chair: How much money has that amounted to?

Mr. David Rideout: It amounts to $20 million.

The Chair: So $20 million, which the industry is in dire need of, is sitting on the shelf because there's a lack of agreement between the B.C. and federal governments, but mainly on the B.C. side.

Mr. David Good: Yes.

Mr. David Rideout: We've made the offer.

Mr. David Good: The offer is there for sure.

The Chair: That's good information to know, because we will have the Minister of Fisheries from B.C. before the committee tomorrow.

Mr. Bernier.

[Translation]

Mr. Yvan Bernier: I liked Mr. Power's question about whether we knew who had found a new job and who had failed to do so. Mr. Good, would it be possible to answer this question and track these people by using their social insurance number? By asking whether these workers had submitted a new application for benefits since that time and, if so, in which sector of activity they indicated they had worked? This is the type of information that I'd really like to obtain.

• 1635

You also mentioned a budget of $760 million, of which $410 million were to be set aside for adjustment as such. I suppose that these amounts were earmarked for the Final Cash Payments. Did these payments cost $410 million or slightly less? How much has been spent? Could you provide us with a detailed table? It should be easy to calculate this by pressing on a button and asking for the total of all the cheques issued. I'd like to know how much of the $760 million has been spent. Is there still money left? Should we take political action in order to help you obtain more funding? I feel somewhat unsatisfied today because we have not received any tables that would provide such information. I'll wait for your answer to this first question.

[English]

Mr. David Good: Thank you.

With regard to the question of the impact in the adjustment out and what has happened, we do know from the TAGS program—and as I've mentioned earlier, we are doing the evaluation on the fisheries restructuring program—that some 10,000 individuals received some form of adjustment programming, and of that amount 3,000 adjusted out of the fishery at a cost of $180 million. In that I'm speaking of the TAGS program.

In response to your second question, with regard to the actual utilization of the moneys, I think it's fair to say that with the funds that have been provided, the $760 million you've indicated, which included the $30 million from the unspent money in TAGS, that is sufficient, we believe, to carry on with the job that's required. It has allowed us to do the final cash payment for 22,000 individuals that I mentioned earlier, and somewhere to the tune of about $200 million. It has allowed us to do the early retirement programming, for which I think the expenditure to date is about $80 million. It has allowed us to do the short-term job creation, for which expenditure to date—and these are not all the final expenditures, because there are still some more to be done—is in the neighbourhood of close to $60 million. And the other measures on adjustments are something in the neighbourhood of $18 million.

So as we look at our budgets overall and we look at the requirements, we do believe that we are certainly within budget. We do believe that with the funds that are there we can continue to do the job. However, we will need, as I mentioned earlier, some of the reprofiling from one fiscal year to the next, particularly with regard to the adjustment measures, so that the funds do not lapse. The take-up rates in some of these areas, which is self-identified, have not been as fast as we had initially anticipated. So it's our proposal to go to Treasury Board and seek reprofiling for those so that those funds would be available for individuals to take advantage of the mobility, take advantage of the adjustment, the wage subsidies and other forms.

The Chair: Last question, Mr. Bernier.

[Translation]

Mr. Yvan Bernier: Mr. Good, I have trouble accepting that we would be asked to wait until the end of the fiscal year, in other words March 31, to get an answer. Certain training programs for the people in my riding cannot be offered because the people responsible don't know whether there will be any funds left and whether they will be able to carry on. We're now in November and people are being told that they have to wait six months to find out whether the programs can be started after March 31.

I'm asking you to give us a summary evaluation, to give the command to your computer's printer to add up all the cheques issued to this date and tell us whether we can be sure that there will be enough funds. If we were in a position to obtain this assurance, perhaps we could immediately start up programs or projects that would continue on after March 31, rather than make people wait. I have trouble accepting such a waiting period.

In closing, I'd like to let you know that I found out about some inadvertent errors in the issuing of certain cheques, and that individuals have received benefits for longer than anticipated. In these cases, your department had ignored these mistakes.

Although this affected a fewer number of cases, I learned that some people had received slightly more money than they should have received and that, in such cases, you did not pass over them. I'd like to look at this situation and would ask that you bring it to the attention of your minister. The individuals that I know who cashed these cheques used them to buy their groceries and they no longer have this money in their pockets. The overpayments are being deducted from modest employment insurance cheques.

• 1640

I'd like to remind you that there was no appeal committee where people could get a hearing. It's the first time that I know of in our Canadian system that we have a situation where a person is told that he or she is at fault and must pay an amount, and that person can no longer argue his or her case anywhere.

I've asked two different questions, both heartbreaking questions: why force people to wait until March 31 to find out whether there will be enough funds, and why do officials deduct overpayments from employment insurance cheques paid to people in need because of mistakes that were made by the system at an earlier time, without allowing them to defend themselves somewhere?

[English]

Mr. David Good: Thank you for the very good questions.

With regard to the first question, we know that there were approximately 2,300 former TAGS clients in Quebec, 1,700 in Gaspésie and the Îles-de-la-Madeleine. To date, of the 1,700 we know that 800 have benefited from the FRA measure, from the restructuring measure. That's either in the form of the adjustment programs we talked about, the transition job funding, the final cash payment, or with regard to the retirement or a licence buyback. We do continue to monitor these programs and we do have a sense of what is happening.

With regard to the question of the final cash payment, certainly we gave a great deal of attention to ensure that this rolled out as smoothly as possible, and I think we're quite proud of how well it's gone out. Nonetheless, there have been some mistakes made, and we've tried to correct those as quickly as we possibly can. But I must say there have not been very many mistakes made.

It's complicated by the fact that one received the cash payment up front, and if one then subsequently opted for the early retirement payment or if one opted for the other alternative, which was the licence buyback, you then had to deduct from the amount of moneys you got on the early retirement scheme. Or if you were another person who took the licence buyback you had to actually deduct from those amounts the amount that had been paid up front on the final cash payment, because you couldn't have one without the other.

The second thing in the final cash payment is that if you had outstanding debts owing the crown for TAGS overpayments, those were deducted off as well, because we had a responsibility, we had very limited funds, and we had to ensure that there was fairness and equity for all. So if one had outstanding various payments that were owed on the previous TAGS for overpayments, they had to be deducted off as well.

In addition, we have a provision that if there are outstanding requirements for maternity payments, or in the case of separations and alimony payments, those are again a requirement that has to be handled. So there's a set of things as to the gross amount paid out and what the actual net was. This is not the case for all individuals, but there were individuals in those cases.

I might add that we did indicate this very clearly in the communications we put out, and we spent a lot of time, frankly, and, I might add, we were very much benefited by our consultations with the unions and with the provinces in terms of how best to implement this in a fair and humane way for the individuals affected.

The Chair: Thank you, Mr. Good.

Mr. Steckle.

Mr. Paul Steckle: Surely the program must be measured on the success of a program against something, whether it's people who have found employment in other areas through retraining or whatever. I have to agree that this is certainly something that needs to be done in every case.

I have a request, which I put to this committee, and which this committee has put forward through recommendations in a freshwater fishery report. I realize it may not fit necessarily today, but I want to put it to you people today because it needs to go on the record. We have asked for $8 million for a sea lamprey program. We have to come back every year and every year to fight for this money. In my calculations for the TAGS program and the post-TAGS program, the money is somewhere in the area of $3 billion. Whether it's from that or it's from the human resources department or whether it's from the fisheries department, it's money. We're asking for $8 million. That has a tremendous payback.

I wonder what kinds of assessments or analyses are done of these programs before they make the determination that we should cut here and we should cut there. I can tell you, if you do the analysis on this program, you'll find that the sea lamprey program returns in the freshwater fisheries, in GST alone in the province of Ontario to the federal government, somewhere between $65 million and $75 million. So that's about nine times the money spent. I doubt if there's another program in DFO that can boast that kind of return.

• 1645

I'm wondering whether those kinds of things should be considered when we make that determination next year. Let's put it on baseline, as requested in the recommendation put in that report.

I'm putting that to you. I'm going to put it to every person who comes here from the ministry. Mr. Good can remind the honourable member who is sitting beside him today, just in case he forgets, because I've also brought that to the minister's attention. I will continue to do that. I want it on the record.

What are your comments?

Mr. David Rideout: Well, I appreciate the “honourable”—

Mr. Paul Steckle: You are honourable today.

Mr. David Rideout: I think the Department of Fisheries and Oceans has responded to the standing committee's recommendations on the freshwater fishery. Before any government program is launched, there is a thorough and comprehensive analysis done.

As for a comparison between the freshwater fishery and the sea lamprey program and the east coast Canadian fisheries adjustment and restructuring measures, the issues are quite a bit different.

Mr. Paul Steckle: I understand that.

Mr. David Rideout: But I think before any action goes into any program the government develops, a comprehensive analysis is completed. Before any funding is confirmed or otherwise respecting sea lamprey, I suspect that analysis will be there to help make the decision.

Mr. Paul Steckle: But, Mr. Rideout, with the information I've given you today, providing it is correct information, would you agree with my analysis that this program being left, and upgraded to the $8 million as requested, would be a good investment?

The Chair: While you're at it, Paul, send that up to Treasury Board.

Mr. Paul Steckle: I'd like to have his comments on that, Mr. Chairman.

Mr. David Rideout: My comment is that industry is better off determining what's a good investment or a bad investment. We just provide what we hope is the best type of analysis. I'd suspect from what you're saying that it's probably a pretty good analysis. But I'll have to leave the rest to others.

Mr. Paul Steckle: Am I then to assume that the assessment you've made of analysis is that it is a correct one and a good one?

Mr. David Rideout: You can be led to assume that I'm tripping over my tongue trying to get out of this.

Voices: Oh, oh!

The Chair: Mr. Power.

Mr. Charlie Power: With regard to licence buyouts, under TAGS 1994-98 I think you had 520 buyouts at about $60 million, and in 1998-99 you had 1,642 buyouts at about $143 million.

In your paper here it says:

One of the main reasons for the current program's success, apart from the fact that the prospects for recovery of the groundfish industry are not very positive, is that we structured the program to permit flexibility in its administration in the regions involved.

David, what do you really mean by that?

The Chair: Too many Davids.

Mr. Charlie Power: Which one of the Davids can figure out what that actually means?

Mr. David Rideout: Each region has its own unique characteristics. The regions wanted to have flexibility in how they were administering the program. That's what we've done. We've provided them with that flexibility.

They have worked with their industry in differing ways in each region while keeping to common principles. As well, when we do a comparison of the Canadian fisheries adjustment and restructuring measures related to licence retirement and the TAGS measures, this time we're dealing with both core and non-core TAGS and non-TAGS licence-holders. So the population available to bid was much larger this time than during the TAGS program.

Mr. Charlie Power: If I can deduce from your own argument that if you use a regional administration approach rather than a centralized one things seem to work better—at least in this licence buyout, it's one of your reasons that it worked better, and even worked better for licence buyout—then why doesn't DFO use it in a lot of its other programs?

As you know, the greatest criticism of DFO, certainly in Atlantic Canada, is that you try to manage everything from Ottawa. So if regional administration works for this program, why can't you try it in so many of our other programs?

• 1650

Mr. David Rideout: Well, I'm one of those individuals who has been fortunate enough to have worked in a region. In fact, I never worked in a regional office, but I did work in a field office for about a decade before coming to Ottawa.

My personal assessment is that DFO was very much decentralized and the approach we took on licence retirement is consistent with approaches that we take on many of the programs we have, whereby the regional directors general are accountable for program delivery.

Mr. Charlie Power: You won't find consensus in the fishing community.

Mr. David Rideout: I understand that.

The Chair: Last question.

Mr. Charlie Power: Has anyone in the Department of Fisheries and Oceans yet begun to asses the licence buyout program and any potential there to satisfy the Mi'kmaq after the Marshall decision as to how these native fishers are going to get access to a fishery? Are we going to find that some of these licensed buyouts that we spent a couple of hundred million dollars purchasing are now going to end up back in somebody else's hands and have somebody else back in the fisheries? Have you started to study that yet?

Mr. David Rideout: In terms of the responsibilities I have for licence retirement, that's not been part of the work plan I have, no.

The Chair: Charlie, if I could interrupt you, that's probably a question more appropriate to the minister when he's here.

Mr. Matthews.

Mr. Bill Matthews (Burin—St. George's, Lib.): I have just a quick question, Mr. Chair.

I don't know if any of you gentlemen were involved in the designing of of the TAGS or post-TAGS program. Were you?

Mr. David Good: I was involved in the post-TAGS program.

Mr. Bill Matthews: Was there any consideration, on the early retirement component, given to survivor benefits at all? Did it ever raise its head in discussion?

Mr. David Good: No, it didn't.

Mr. Bill Matthews: Never, ever?

Mr. David Good: Not to my knowledge in the discussions I was involved with, no.

Mr. Bill Matthews: The reason I ask the question is that I've come across a couple of cases where fishermen who took early retirement have deceased, and now their widows are left without any income. I wondered if it had ever been discussed anywhere in this whole program design, or if you knew about it, because it's obviously a very serious... If it's not a serious oversight, certainly somewhere I would have expected, between DFO, HRDC, FFAW, and all the parties that were involved in this, someone would have at least raised the question or discussed survivor benefits, and they didn't. It's causing a lot of hardship, even though it's a small number of cases. But when you get a 53-year-old widow, left with a couple of dependants... I just wondered.

Mr. Charlie Power: I'd like to add a point to that before you answer it. HRDC and our federal fisheries were pretty reasonable in an instance in my riding where, before the final payment was made, the gentleman actually died—a fisherman. You paid the final payment to his spouse, which was quite charitable and decent at the time, considering the circumstances. In that case, it was the right thing to do. I think the case that Bill brings up is a good example as well.

Mr. David Good: This is a very good question; thank you for drawing it to our attention. Let's remember, there were two programs there. The one I believe you're talking about was the final cash payment, and indeed in the final cash payment there is provision for that.

The question was raised with regard to the retirement, and it is interesting. I must say, from a personal note, the kind of consultation we did have was very extensive, and it's unfortunate that issue did not get raised. It's a very good question. As you know, we did make a number of modifications to that program that we thought were important improvements, one of which was to recognize that the high-income individuals, over $40,000—there were arguments as to why they ought not to receive the final cash payment, and we did put up a graduated scale.

Mr. Bill Matthews: Let me just ask you if we have information on this issue. Obviously, for the people who qualified for early retirement, your projections were that you would pay them until they reached the age of 65 and that would trigger into CPP-OAS and then it would stop. In your calculations of the money required to fund the early retirement program, did you use mortality tables, or was there a mortality factor in all of this that said you could tell there were x number of people that were going to come out?

• 1655

I guess what I'm saying is for those people who have died since they took early retirement, what would happen to the money consequently—would there be some consideration for survivor benefits? I think it's a very legitimate request, and it should not be too late to put it forward if the money's there.

Mr. David Good: The way the early retirement scheme operates is annuities are purchased on behalf of the individual; that's the mechanism under which it operates.

Mr. Bill Matthews: The annuity is purchased, but then what happens in this case where the annuity was purchased to pay this gentleman till age 65 and it ended eight or nine years early? What happens to the money from the annuity?

Mr. Charlie Power: What has happened quite lately is the annuities will be based on an actuarial base, allowing for a certain rate of mortality.

The Chair: But what happens to the survivor—is that what you're asking?

Mr. Bill Matthews: What happens to the annuity? The annuity was set up to pay this man, say one man, till he was age 65, who's now died, so the annuity still exists or the money flows somewhere else, obviously, right?

The Chair: Right.

Mr. Bill Matthews: The money was paid into an annuity to pay this man this benefit till age 65, which is now not being paid, so what happens to the money that's in the annuity? Why couldn't it be paid to his wife?

The Chair: Can anyone answer that question?

Mr. David Good: Mr. Chairman, could I ask Ron Stewart, our director general of the labour market directorate, to answer that?

The Chair: Yes. Go ahead, Ron.

Mr. Ron Stewart (Director General, Labour Market Directorate, Department of Human Resources Development): Thank you very much.

It's just as Mr. Power basically suggested. The annuities are purchased. The cost annuity is based on the actuarial expectations surrounding an individual, and they're all individually based. If the money were to be transferred to the spouse, then of course the cost of the annuity would go up, simply because it wouldn't be based on an individual, it would be based on the expectation of life for two individuals.

So the annuities have been purchased on an individual basis. That's the way the program is operating at present. As you say, it's probably unfortunate that no one, through all the consultations, actually thought of this.

Mr. Bill Matthews: It's unreal.

Mr. Ron Stewart: However, on the basis of the final cash payments, because of the situation Mr. Power brought forward, what we have done is ensured that should the beneficiary of that die beforehand, the final cash payment goes to the estate of the individual, based on that situation that came up.

The Chair: We will certainly talk about this as a committee at some point in time, and maybe send a letter on it.

Did you have another point, Mr. Bernier? This is the last question for you, Mr. Bernier; this is your third round.

[Translation]

Mr. Yvan Bernier: I think that we're supposed to continue until 5:30 p.m.. If no one else has any questions, I would perhaps have a few more.

I'd like now to talk about the licence buyouts and to make an initial minor comment. The French version of the tables that were given to me show the breakdown by province. We see New Brunswick, Nova Scotia, Prince Edward Island and then Laurentian. That's a region. I'd therefore like to make the correction, unless there's a new province going by the name of "Laurentian".

What I'd like to know is this: you show us, in your table, the number of licences that were retired, their average cost and the total cost of the buyout. I'd like to know what percentage the 1,642 licences represent of the total number of licences in the five affected provinces.

Is it possible to find out the total number of groundfish licences that there were in 1993? Then we'd only have to subtract 1,642. Did licence reduction reach 1%, 2%, 5% or 10% of the total number? I'd like to know, with regard to the number of licences, the details of each of these licences. I imagine that, if you used reverse bidding for the buyouts, your calculations took into account the fisher's background and the tonnage associated with these licences in the case of individual buyouts.

• 1700

How many tonnes did they represent? I suppose that these would be tonnes expressed in terms of the fish available in 1993. To this—in 1993, we had 40,000 tonnes in Area 4T of the Gulf, I believe—we would have to add the tonnage in areas 4R and 4S. I'd like to know what percentage that might represent in tonnage.

And now for my last question, since the chairman is urging me to finish. Did the licence retirement measures change the way that the resource is shared among the provinces?

Mr. David Rideout: Thank you very much. The Laurentian Region is the region that corresponds to the province of Quebec, for Fisheries and Oceans.

Mr. Yvan Bernier: In that case, the word "region" should be used in the table heading.

Mr. David Rideout: As for the sharing of the quota, the provinces received the same quota as they had at the start of the program. If any changes are to be made, it will be after consulting with the provinces. For the time being, there's no change.

As for the other questions, I'll give the floor to my colleague, Lorne Anderson.

[English]

The Chair: Mr. Anderson.

Mr. Lorne Anderson (Director, Restructuring and Adjustment Branch, Department of Fisheries and Oceans): With respect to your question about the percentage of reduction of groundfish licences since the program began, in 1992, at the start of the moratorium, there were about 1,800 groundfish licences in the Atlantic. At the commencement of this process, after TAGS and prior to this, there were about 13,000.

This is certainly more than a 10% decrease, and a further decrease to date, so it's quite a different fishery from what it was in 1992. We didn't really have any targets because it was a voluntary program.

But I think there were 878 licences taken out under NCARP and another 520 under TAGS. There were the 1,642 you've indicated here, and then there were a number of licensing policy measures that took place in the mid-nineties that resulted in some other reduction in licences.

So as I say, as this program began there were about 13,000.

The Chair: Thank you very much—

[Translation]

Mr. Yvan Bernier: Could we find out how the 13,000 is distributed among the provinces?

[English]

The Chair: I think there's some further information the witnesses agreed they would send, that included, Mr. Bernier.

There are no further questions, so we will adjourn. I might say before we do that certainly this is a very different discussion from the one we had on TAGS at the time of the Auditor General's report. I think we're very pleased to see a more positive response and see that the FRAM program is working better.

So with that I'd certainly thank you for your presentation.

Go ahead, Mr. Bernier.

[Translation]

Mr. Yvan Bernier: Sorry, but I don't agree with your conclusion. The picture is not any rosier for the administration of TAGS in our regions. I cannot agree with your conclusion. There's a chance that I didn't understand the interpretation correctly, but I'll let you finish.

[English]

The Chair: Well, one pessimist in the bunch doesn't hurt, Yvan.

Anyway, I think my statement still stands. We do require the further information, and we'd certainly like to see the evaluation when it's done as well.

The meeting is adjourned to the call of the chair.