BUSINESS ECONOMY

Bowing to East Coast fishermen

CHRIS WOOD May 19 1986
BUSINESS ECONOMY

Bowing to East Coast fishermen

CHRIS WOOD May 19 1986

Bowing to East Coast fishermen

Late last month 60 angry Nova Scotia-based fishermen gathered in a local firehall in Meteghan, 230 km southwest of Halifax, to issue an ultimatum to federal Fisheries Minister Thomas Siddon: if Ottawa did not increase the fishing rights of the 230-vessel dragger fleet within five days, the draggers would begin fishing in defiance of federal quotas

along Nova Scotia’s Atlantic coast from Digby to Cape Breton. Four days later—on April 24—many of the same fishermen, members of the hastily created Nova Scotia Dragger Fishermen’s Association, had assembled in nearby Yarmouth when South West Nova Conservative MP Gerald Comeau announced on Siddon’s behalf that the draggermen would be allowed to catch an additional 10,000 tons of fish. Fishery leaders, stunned by the decision, accused Siddon of bowing to the bully tactics of one group of fishermen—and of setting a dangerous precedent. Said Allan Billard, executive director of the 7,500-member Eastern Fishermen’s Federation: “He has opened a Pandora’s box.”

Indeed, last week there was growing concern that the minister may have done far-reaching damage to the future of the $2-billion Atlantic fishery. Many fishermen say they now fear

that Ottawa’s commitment to the twoyear-old fish allocation system—which reserves a portion of the yearly catch for 17 processing companies in Newfoundland and Nova Scotia—is wavering. The allocations are considered crucial to an industry blueprint for revival drawn up in 1983 for the federal Liberal government by Michael Kirby, now a Liberal senator.

At the end of May, senior officials from Siddon’s ministry are scheduled to meet with East Coast fishing industry representatives to try to resolve the problem of too much competition for a limited amount of fish. Siddon told Maclean ’s that he also wants to widen the debate to include the future of the guaranteed allocation system.

Pitted against each other on that issue are two of the Atlantic fishery’s most powerful groups: the inshore draggermen—known as the wealthiest fishermen in Canada, with a buccaneering disdain for government —and National Sea Products Ltd. of Halifax, North Amer-

ica’s largest processor and deepwater fishing company. For his part, Siddon faces his most serious test since assuming the fishery portfolio last November when former minister John Fraser resigned over the tainted tuna scandal. Siddon denied suggestions that he had caved in to pressure from the newly created lobby of draggermen. Instead, Siddon argued, he was

merely adjusting “an imbalance” in the allocation of fish between competing fishermen in the region. Said Siddon: “It just didn’t seem reasonable to leave fish in the sea uncaught.”

But fishery observers say that by reopening the allocation system, Siddon threatens the industry’s hard-won recovery over the past two years. Said federal Liberal fishery critic George Henderson: “He is bowing to political pressure. It sets a very dangerous precedent.” Indeed, Siddon’s reversal of the limits placed on the draggermen has fuelled speculation that the federal government may move closer to the previous system. Under

that arrangement, no fish were specifically reserved for the major processors; instead, fishermen operated on a first-come, first-served basis. That meant fishermen had to compete to land the most fish as early as possible in the season before the quota was exhausted. That forced processors to build up their fishing fleets and frozen storage capacity to catch and preserve the huge inventories needed to keep their plants operating all year long. As a result, processors ended up with a crushing debt burden.

Three years ago, in an attempt to resolve that problem, the federal government, two provinces—Nova Scotia and Newfoundland—and private East Coast investors arranged a $360-million restructuring and refinancing for seven of the region’s most troubled fishing and processing companies. Under the reorganization, the fishing companies merged to create the Atlantic region’s two largest integrated operations—National Sea Products and Fishery Products International Ltd. of St. John’s.

At the same time, the federal government partially reformed the fish allocation system, providing guaranteed fishing quotas to the two integrated giants as well as to 15 smaller processing companies.

That meant they would be able to harvest fish throughout the season, according to demand from consumers. But while the guaranteed allocations eased much of the financial strains on processors, they have done little to solve the bitter competition between them and other fishermen such as the draggermen.

The draggermen —with their 66-foot-long wooden boats called draggers —are among the most efficient harvesters of fish afloat. Adventurous fishermen, they go as far as 50 miles from shore in search of cod, pollock and haddock. The draggermen who demanded an increase in their catch allocations are located predominantly in Meteghan, Yarmouth, Digby and a dozen smaller ports in southwestern Nova Scotia. Equipped with six-man crews, nets and sophisticated sonars, the draggermen can generate revenues of up to $35,000 a day. They are easily capable of harvesting a full year’s quota in a few weeks.

Indeed, it was that voracious ability to land fish—and the pressure on boat

owners to pay back heavy loans taken out to buy the latest equipment— which set the stage for the ultimatum to Siddon. Last December, when the federal fisheries department announced catch allocations for 1986, the quota for draggermen was reduced by 14 per cent to less than 30,000 tons. National Sea and other producers operating deepwater trawler fleets saw their catch allocations drop by more than 15 per cent. That was done after federal biologists determined that fewer fish would be available this year

compared to last year.

Dissatisfied with the new allocations, in mid-January the draggermen launched a campaign to secure access to more fish. They demanded that Siddon meet with them within 10 days to discuss transferring to them about 16,000 tons of fish allocated to National Sea and other processors. Instead, Siddon met with the fishermen in Halifax two months later and offered an increase of 5,500 tons. The draggermen rejected the offer and, with many of their vessels tied up because they

had already exhausted their fishing quotas, the dispute gained momentum.

Then, 60 out of a total 2,000 draggermen organized themselves into a lobby group with the help of Yarmouth’s Conservative deputy mayor, Clifford Hood, who is also a lawyer. Their lobbying efforts included sessions with local MP Comeau and five southwestern Nova Scotia Conservative MLAs in the Tory government of Premier John Buchanan.

On April 20 the fishermen voted to begin fishing in defiance of quotas if Siddon did not deliver the expanded fishing rights by 6 p.m. on April 25. Throughout that week the draggermen kept up the pressure, and persistent questioning in the provincial legislature forced Buchanan to recall his fisheries minister, John Leefe, from a Florida vacation to deal with the issue.

With Siddon still apparently undecided, Buchanan initiated a long telephone conversation with the federal minister. Then, one day before the deadline, Siddon directed Comeau to make the announcement in Yarmouth extending the quotas. Meanwhile, Siddon’s assistant deputy minister, William Rowat, conveyed the decision to National Sea’s president, Gordon Cummings. In a telephone call that Cummings described as curt, Rowat said that a complex quota transfer would give the draggermen about 10,000 extra fish—most of it taken from National Sea’s allocation. Cummings said that the abrupt change will cost National Sea $20 million in sales this year—and $2 million in profits. Said Cummings: “We were stunned. We needed that fish.”

For the draggermen, the successful lobby will mean

2 more fish and more money. But for many in the fishery, the Siddon decision has already done critical long-term damage. Sandy Siegel, a Yarmouth-based agent of the 3,000-member Maritime Fishermen’s Union, which represents about one-third of the region’s inshore fishermen and which joined the draggermen’s appeal for higher quotas, says, “It looks like he was giving into blackmail.” Declared Billard of the Fishermen’s Federation: “We‘re all waiting for the next guy who wants something to say, ‘You’ve got ’til Friday.’ ”

CHRIS WOOD in Halifax