Fisheries and Aquaculture
June 30, 2009
Provincial Government has Demonstrated High Level of Commitment to
The Provincial Government has demonstrated a high
level of commitment to the province’s fishing industry through increased
investment and development of strategies to address the industry’s
structural issues. Meanwhile, the industry itself has failed to take the
action needed to address these issues.
The budget for the Department of Fisheries and
Aquaculture has been tripled by the Williams Government since 2003. As a
result, at $33.7 million, the department’s budget in Newfoundland and
Labrador is larger than the total budgets for fisheries and aquaculture
in the Maritime Provinces combined. In addition, there is a long-term
strategy in place through the Fishing Industry Renewal Strategy which
was developed after a high level of consultation with industry and
involves a financial commitment of up to $140 million on the part of the
Provincial Government. This is far in excess of the investment in
fisheries renewal in any of the Maritime Provinces.
The Fishing Industry Renewal Strategy includes a
capital gains exemption valued at approximately $25 million. There are
long-standing exemptions from fuel taxes for the fishing industry. As
well, the Honourable Tom Hedderson, Minister of Fisheries and
Aquaculture, recently offered an exemption from this year’s processing
licence fees, at a cost of $1.7 million in revenue to the province. This
exemption was offered in an effort to assist the industry in reaching a
price agreement that would start the shrimp fishery. These are the only
fees being paid to the Provincial Government by the fishing industry.
"Our government has taken a long-term approach to
addressing the underlying structural issues in the industry that
continually plague us every fishing season," said Minister Hedderson.
"In the midst of a difficult year, the fishing industry is resorting to
suggestions of quick fixes such as subsidies which do not deal with
long-term structural issues and would violate international trade
agreements. Furthermore, the industry has presented no financial
evidence to verify the need for government intervention."
The most significant marketing challenge facing the
shrimp sector is access to markets and prohibitive seafood tariffs.
Today, the Honourable Danny Williams, Premier of Newfoundland and
Labrador, is in Europe addressing these issues. He is also addressing
the proposed European Union ban on Canadian seal products.
Since 2003, the Provincial Government has implemented
the Dunne Report and announced the Fishing Industry Renewal Strategy.
The strategy included a plan to address seafood marketing, a fish
auction, processing policy, fisheries research and development, an
enhanced loan guarantee program, a reduction in capital gains taxes and
occupational health and safety in the fishing industry. As well, the
province has implemented a Fish Price Setting Panel to resolve price
disputes such as the one that is occurring now. There is a mechanism in
place for the harvesters to appeal the price to the panel if they are
dissatisfied with the current decision. They also have the option of
re-entering negotiations with seafood processors.
"Our government has been working to enhance seafood
marketing," said the minister. "In 2006, we offered to purchase the
marketing arm of Fishery Products International Limited for
approximately $100 million. We later offered up to $5.4 million for a
provincial seafood marketing council. The industry turned down both of
those offers, despite the demonstrated need for improved marketing,
which was recommended in the Roche Report. As well, we worked with
industry to establish a cod auction which the industry then refused to
support. In the meantime, the industry continues to lobby the Provincial
Government for additional seafood processing licences, despite their
repeated calls for rationalization of the industry and despite the
adverse effects that this would hold for plant workers."
The province has recognized that this is a difficult
year from a financial perspective. In February, the Provincial
Government suggested working groups with industry to address the
problems in the coming year. There has been no industry response to this
offer to date. The Provincial Government recently offered to undertake a
financial analysis, with industry, of the fishery to document the
financial difficulties that are being experienced and to examine and
address structural issues over the long term. It has actively been
lobbying the Federal Government on aid for lobster harvesters. It has
offered to provide employment opportunities at the end of the season if
plant workers and deck hands do not qualify for Employment Insurance
benefits. The province has also offered 30 per cent of the cost of
rationalizing an industry that is licensed primarily by the Federal
The issues in the shrimp fishery have been well
studied and well documented going back to 2002. The Provincial
Government developed a plan with industry to address these issues which
was abandoned by the fishing industry after one year.
"Our government is very disappointed that harvesters
and processors have not been able to agree on a price for shrimp," said
Minister Hedderson. "The two groups have been very far apart. The market
intelligence available to my department demonstrated that there is a
reasonable price for both groups between the two positions and our
government does not see it as appropriate to get involved in settling
industry price disputes. I call on the industry to get back to the
bargaining table and resolve this dispute for the sake of all the people
who are depending on the fishery throughout the province. We remain
committed to engaging with the industry to deal effectively and
conclusively with the industry’s long-term challenges."
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Lori Lee Oates
Director of Communications
Department of Fisheries and Aquaculture
Highlights of Provincial Government
Investment in Fishing Industry
The Fisheries Technology and New Opportunities
program was announced in the fall of 2007 as part of the provincial
component of the Fishing Industry Renewal Strategy, and received $6
million in provincial funding over three years. There have been
approximately 100 applications received under the program, more than
80 of which have been approved for funding. Approximately $3.5
million in total project costs have been funded by the department,
with a total cost of $9.7 million being invested in the industry.
The Provincial Government provided funding to
implement a voluntary fish auction pilot project. The pilot project
was implemented by the Fish Harvesters Resource Centre. The
Provincial Government provided funding for the pilot initiative
through a grant of up to approximately $84,000.
In Budget 2009, $1.2 million is allocated towards
workforce adjustment initiatives. These initiatives support workers
impacted by capacity reductions in the fishing industry and for
former workers of plants that have been designated as being
permanently closed. Services include transitional employment
counseling, short-term employment support, and intensified regional
economic diversification efforts. This is part of the $2.55 million
allocated for this program under the Fishing Industry Renewal
Budget 2009 allocated $250,000 to establish a
Fishing Industry Safety Council that includes industry and
Provincial Government representation. The council’s focus will be on
research, education and training, promotions and communication
related to fishing industry safety. This was part of a $750,000
allocation for the program over three years as part of the Fishing
Industry Renewal Strategy.
The Provincial Government provided funding to the
Fur Institute of Canada and Marine Institute to carry out workshops
with sealers. The purpose of the workshops was to engage sealers on
the most current harvesting practices and inform them of changes to
existing harvesting methods as the regulation of the industry
continues to evolve. Approximately $83,000 was provided through the
Fisheries Technology and New Opportunities Program.
In delivering on its commitment under the Fishing
Industry Renewal Strategy, the Provincial Government announced that
the province will operate under a revised seafood processing policy
framework. The revised framework includes more rigorous policies in
relation to the issuance of new processing licences, tighter policy
guidelines for the transfer of licences and opportunities for the
combining of the existing value-added (snap-and-eat) crab licences.
A grant of $50,000 to the Association of Seafood
Producers in its pursuit of Marine Stewardship Council certification
for the Canadian Northern Trawl Shrimp Fishery.
An investment of $89,000 to support efforts of
the Association of Seafood Producers to reduce energy costs in the
fish processing sector in Newfoundland and Labrador.
The Provincial Government has invested $100,000
in sealing industry communications for each of the last four
budgets. This has funded the development of information packages on
the industry, a sealing industry website and visits to Europe to
address the European Union and its member states.
The Provincial Government continues to facilitate
industry participation in seafood shows in Boston, Brussels, Moscow
Spain and China.
Funding for Fish Food and Allied Workers Projects
$85,000 for a lobster enhancement pilot project
that was carried out in partnership with the Fish, Food and Allied
Workers (FFAW), Marine Institute, and federal Department of
Fisheries and Oceans. The purpose of the pilot project was to
investigate options for seeding coastal waters in Placentia Bay with
larval lobster, for the purpose of lobster stock enhancement.
$23,000 for a project to reduce the halibut
by-catch in the 4R turbot fishery, on the west coast of the island
and up through the straits of Labrador. The project was carried out
in partnership with the FFAW.
$99,000 toward a new fishing vessel energy
efficiency initiative for the Newfoundland and Labrador fishing
industry. The initiative was carried out in partnership with the
Canadian Centre for Fisheries Innovation (CCFI) and the FFAW.
Allocation of a maximum contribution of $10,000
for a lobster resource assessment in area 3KLPS, located on the
province’s north-east and south coasts. This funding was made
available to the FFAW.
Financial and in-kind support to a green crab
mitigation pilot project. This included $12,000 in funding from the
Division of Sustainable Fisheries and Ocean Policy Division. This
was a pilot project of the FFAW.
$15,000 to the FFAW for a lobster monitoring
project in NAFO areas 3KLPs.
$99,475 to the FFAW for Phase II of a lobster
enhancement project in Placentia Bay.
The province’s aquaculture industry has
experienced a high level of growth in response to the high level of
investment in the industry by our government. The total value of the
industry has almost doubled from $33.6 million in 2005 to $63.3
million in 2008. This creates opportunities for additional
processing sector activity in addition to spin off benefits in areas
such as the making of cages, nets and feed production. The number of
people employed in aquaculture has almost doubled since 2005 to
The Provincial Government is moving forward with
building an aquatic animal health laboratory and aquaculture
administration facility at St. Alban’s, on the province’s south
coast. It is estimated that the cost of the facility will be $7.2
million. The facility is expected to house 10 staff, including
development and inspection personnel, as well as aquatic health
staff and veterinarians. Construction will begin in the fall of
The province will invest $5 million in
aquaculture infrastructure projects on the province’s south coast
and leverage an additional $5 million from the Federal Government,
for a total investment of $10 million over the next two years.
In Budget 2009 $2.45 million is allocated for
continued funding in the Aquaculture Capital Investment Program.
In Budget 2008, the provincial Department of
Fisheries and Aquaculture allocated $2 million over four years to
assist with the development of a cod demonstration farm. This is
part of an $8.5 million cod aquaculture demonstration farm project
with Cooke Aquaculture and the Federal Government.
In Budget 2007, $12.5 million was allocated under
the Aquaculture Capital Equity Investment Program to attract
investment and grow the province’s aquaculture industry. The budget
also allocated $180,000 for aquaculture industry support programs.
The Provincial Government invested $1.9 million
was invested in waste-water treatment equipment for processing
facilities on the south coast of the island.
With a commitment of $7.8 million, the Provincial
Government is supporting Gray Aqua Group Limited of New Brunswick to
establish a $16-million, four-site salmon aquaculture operation in
the Bay d’Espoir region. To assist the company, the province will
provide a loan guarantee of $6.8 million under the Aquaculture
Working Capital Loan Guarantee Initiative and an equity investment
of $1 million under the Aquaculture Capital Equity Investment
The new operation provides for 35
permanent jobs and 40-person years in processing employment.
Furthermore, it is anticipated that the operation will create
additional and equivalent levels of employment in the supply and
service sectors such that the total employment impact will be in the
order of 150 jobs.
Funding for aquaculture nearly tripled in Budget
2006, largely due to allocation of $10 million for the Aquaculture
Capital Investment Program and funding for a cod demonstration farm.
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