Expropriate offshore shrimp licences in favour of regional quotas, or charge royalties for a legacy fishery fund

I gave the following presentation today (May 24th) in St. John’s to the Ministerial Advisory Panel conducting an external review of the Department of Fisheries and Oceans’ Last-in, First-out policy (LIFO) for the northern shrimp fishery.

To begin, I’d like to thank the Ministerial Advisory Panel for the work you’re doing in carrying out this external review of the federal department’s Last-in, First-out policy for the northern shrimp fishery.

Thank you.

The panel is to provide advice on whether the LIFO policy specific to the northern shrimp fishery should be continued, modified or abolished. 

My recommendation is that the policy be abolished. 

But I’ll get there in a moment — I’d like to first put my presentation, my comments, in context. 

My perspective is that of a former Newfoundland and Labrador Member of Parliament (2011-2015). Prior to that I was a journalist.

I have followed the fisheries closely since the early 1990s, since before the collapse of the northern cod fishery, back in 1992. 

For most of my four and a half years in Ottawa I served on the House of Commons Standing Committee on Fisheries and Oceans — the only MP from Newfoundland and Labrador to do so. 

Two years ago, in the winter/spring of 2014, there was word of cuts to the quota for northern shrimp. 

And there was fear of the disproportionate impact that the Last-in, First-out policy would have on the inshore sector — on inshore fishermen, inshore plants, and the rural economy. 

So, on April 7th, 2014, I introduced a motion to the standing committee. 

The motion read:

That the Standing Committee on Fisheries and Oceans immediately undertake a study of the impacts of the cuts to the inshore shrimp quota off the coast of Newfoundland and Labrador on fishermen and the local economy; and that the study include a review of the department's science related to the fishery and the management policy known as last-in, first out; and that witnesses include but are not limited to DFO officials, DFO scientists, local fishermen and local processors.

The motion was debated — mostly in-camera, out of the public eye. 

The Conservative government of the day and its majority MPs on the standing committee defended the LIFO policy.

They were not in favour of changing it, which was obvious. 

In the end, the Conservative-controlled standing committee passed my motion, but with amendments. 

The study would not so much investigate the economic impacts of a cut to the shrimp quota and a review of the science, as my motion recommended. 

I’ll read you the motion that passed, so you can see the difference:

“It was agreed — That the Committee immediately undertake a study on the changing ocean conditions or other factors off the coast of Newfoundland and Labrador that have led to stock fluctuations in northern shrimp and other species; and that the study include a review of the Department of Fisheries and Oceans’ science related to the shrimp fishery and conservation management measures.” 

In the end, the standing committee held four meetings —  all in Ottawa — and the committee did not make any recommendations to the minister on the LIFO policy.  

Instead, a transcript of the witness testimony was forwarded to the Minister’s office, with no comment whatsoever from the Standing Committee on Fisheries and Oceans. 

As an MP, it wasn’t the first time I felt like a trained seal … 

To reiterate the sentiment I expressed at the start of my presentation, this external review of the LIFO policy is extremely welcome. 

While the Conservatives — back then in 2014 — were for the LIFO policy, and against changes, the stand of the New Democratic Party of Canada was … complicated. 

Leading up to the 2015 federal election, Leader Tom Mulcair visited Newfoundland and Labrador and said he was in favour of eliminating the LIFO policy. 

Straight up elimination. He used that very word. 

That caused an immediate reaction from NDP MPs representing the Maritime provinces, home of some of the holders of offshore northern shrimp licences.  

The NDP MPs from the Maritimes didn’t necessarily want to see the LIFO policy eliminated. 

In the end, the NDP changed the wording of its policy that it would fix the LIFO policy. 

A subtle change — but a major one — from eliminate LIFO to fix LIFO. 

I raise the stands of the federal Conservative and New Democratic parties with regards to the LIFO policy to give a little taste of the political pressures that impact decisions in fisheries management. 

They are ever present and enormous — and the minister of Fisheries and Oceans has absolute control, more than any other federal minister.

I’m not here to debate the details of how the 1997 LIFO policy came about.

I’ve heard recollections from both sides — inshore and offshore — of the circumstances surrounding the drawing up of the policy. 

I can say this with authority — circumstances change. 

Fisheries change. 

The health of different stocks change — they rise and fall. 

Both sides in this debate have spent a fortune lately on advertising campaigns — attempts to win over the public.

The inshore sector says the vibrant rural economy faces a “grave” threat, so it’s time to choose — “corporate trawlers or home.”

“The corporations will survive no matter not. We will not.”

“Choose home,” is the message of the inshore sector. 

The corporations — a.k.a. the offshore sector, the Canadian Association of Prawn Producers — presents itself as “fishing for Newfoundland and Labrador.”

The offshore sector highlights how it employs hundreds of people from 116 communities, “generating the most value from every shrimp.” 

As it stands, the LIFO policy essentially means that the last entrants into the fishery for northern shrimp — in this case the last entrant, literally, was the inshore fleet — should be the first out if there’s a reduction in quota.

Ironically, the inshore sector argues its been around for hundreds of years — they were the first ones fishing, period,  — and should be the last ones out. 

Again, I recommend that LIFO be abolished. 

In its place, Fisheries and Oceans should establish fair sharing in the shrimp fishery so that everybody shares in the ups and downs of the resource.

Both the inshore and offshore sectors have a place in the northern shrimp fishery.

But in the case of northern shrimp — as with all species — the resource-access pillars of adjacency and historic dependency must be respected first and foremost.

They must be the constants. 

Fish should not be shopped around for political purposes.

It was just last week that the federal Liberal government decided to return the halibut quota allocation in the Gulf of St. Lawrence to the previous regional sharing agreement. 

The former Conservative Minister Gail Shea had changed the formula so that fishermen in her home province of PEI were given a preferential share of the halibut. 

Those types of political decisions must stop. 

But they won’t unless there’s a fundamental policy change, which must  go for all fisheries — not just northern shrimp. 

Again, I recommend that LIFO be abolished. 

In its place, a new resource-access policy — one based on adjacency and historical dependence — must be instituted.

Those closest to the resource must benefit the most from the resource. 

That’s my first recommendation. 

My second recommendation is that the ownership of offshore shrimp licenses — foreign and domestic — should also be further explored. 

Who exactly holds the rights to the licenses and where are profits going? That information should be public. 

This is a common property resource we’re talking about — owned by the people. 

Third, regional community-based quotas and licenses should be explored.

Regional-based quotas such as the one held by the Labrador Fishermen’s Union Shrimp Company seem to work well for that region of the province. 

Can regional-based quotas work for other regions of the province? 

I would say absolutely yes.

The federal government should explore expropriating offshore licences in favour of region or community based quotas. 

Rural communities should be the primary beneficiaries of all resource development.

We must have the ability to do for ourselves. 

In the absence of regional-based quotas, holders of offshore northern shrimp licences should pay a royalty on profit to a fishery fund. 

Norway, for example, has an oil fund of almost a trillion dollars whereby taxes from oil profits are invested. 

There’s been talk in Newfoundland and Labrador as well of the creation of a legacy fund for the oil industry (or why such a fund hasn’t already been created) — a fund used to collect offshore oil revenues to protect the provincial treasury in the decades to come. 

The same thing should happen in the fishery whereby the holders of offshore licences pay a royalty on profits into a fishery fund — a fishery legacy fund. 

A fund to offset the highs and lows — the ups and downs in different fisheries — and to invest in rural communities that are adjacent to the resource and have an obvious historical attachment. 

The choice should not be between inshore and offshore sectors of the fishery … and who contributes more, which sector is more important. 

There must be a place for both. 

The sole consideration should be what’s good for Newfoundland and Labrador, which was built on the fisheries in the first place.