The ALLIANCE

Status Report on Co-Managed Fisheries
Edwin Blewett & associates Inc
September 12, 2002

Introduction

The BC Seafood Alliance

In May 2001, the BC Seafood Alliance organised and hosted the BC Seafood Summit 2001. Funding was provided by the BC Ministry of Agriculture, Food and Fisheries, Fisheries and Oceans Canada, the Office for the Commissioner for Aquaculture Development and Fisheries Renewal BC.

Based on input received from Summit participants, the BC Seafood Alliance prepared a document describing its "Vision for a Modern Seafood Industry in British Columbia" including key industry objectives, measurable targets and recommendations for public and private sector action. The Vision paper includes 8 action items, one of which is concerned with cooperative management of commercial fisheries.

Within five years, negotiate cooperative management agreements for all of BC’s commercial fisheries that establish roles and responsibilities of the federal government, the provincial government and fisheries interests—and provides security of access to the resource for tenure holders.

Co-management arrangements have existed for the past decade in Pacific fisheries (sablefish, eg, has had a co-management agreement since 1993). Co-management arrangements have been used to foster improved compliance with fisheries regulations, safer fishing practices and to put in place joint scientific, monitoring and enforcement programs. The experience gained from co-managed fisheries such as black cod, halibut and geoduck has been very valuable and has provided direction for the development of co-management in other fisheries.

Informal co-management described above applies mainly to arrangements between Fisheries and Oceans Canada and commercial fish harvesters. Different co-management arrangements exist at a broader level. Multi-stakeholders watershed and management boards, community-based management bodies and habitat enhancement projects involving community groups and other stakeholders are examples of ways in which DFO collaborates with outside parties on projects that have implications for fisheries.

The Aboriginal Fisheries Strategy provides for negotiation of mutually-acceptable and time-limited agreements with aboriginal groups but these are outside the scope of this assignment.

In light of developments to date in co-management of Pacific fisheries and the Seafood Alliance’s goal of negotiating cooperative agreements to co-manage all BC commercial fisheries within five years, the Ministry of Agriculture, Food and Fisheries agreed to fund the preparation of a Status Report on Co-Managed Fisheries in BC and, following a competitive tendering process, selected Edwin Blewett & Associates Inc to undertake the assignment.

The report is to be presented to a BC Seafood Alliance workshop, "Sustainability through Co-Management" in October 2002.

The Terms of Reference for the Status Report

The Terms of Reference for the assignment asked the successful proponent to address fifteen questions and categorize Pacific fisheries according to their readiness for co-management. I have structured the questions into four groups as follows.

Factual/Background

1. Which fisheries are currently co-managed?
2. What does co-management entail for each fishery?
3. What federal regulations and policies allow for co-management agreements?
4. What components of co-management are cost-recovered? (consider at least stock assessment, observers, port monitoring, management, catch monitoring, enforcement and administration).
5. What, if any, mechanisms are used to recover costs?

Perspectives

6. What does co-management mean to client groups?
7. What does co-management mean to governments?
8. What are the drivers (benefits) of co-management to clients; to the management agency; for the market.
9. What are the benefits and constraints of co-management to non-fishers – processors, etc.

Assessment

10. Do current co-management arrangements meet client expectations?
11. What are similarities and differences among co-managed fisheries?
12. In non-co-managed fisheries, what factors support or detract from moving towards co-management? (consider at least: lack of representative organisations, low inherent value of fishery, little scope for cost recovery).
13. Are current flexible, fishery-specific arrangements regarding what is covered in co-management costs suitable for moving towards co-management in other fisheries? Or is uniformity required? Is there an equity issue? (among fisheries with different cost recovery scope).

Economic Evaluation

14. What is the ratio of co-management cost to landed value in each co-managed fishery? Estimate similar ratios for fisheries that are not currently co-managed.
15. Are any fisheries paying resource rent to the federal government for access to fish stocks (ie, do costs recovered by DFO in a fishery exceed the department’s costs of opening and managing it).

The successful proponent was also asked to categorize non-co-managed fisheries according to whether they would be candidates for co-management:

• Immediately.
• Within two years.
• Within five years.
• Never (ie, unlikely to be viable as co-managed fisheries).

Methodology

Information was gathered for inclusion in this Status Report principally through interviews with representatives of fisheries organizations and MAFF staff whose names appear in Appendix A.

The Terms of Reference for this assignment included the names of seven DFO staff to be interviewed. During interviews the names of an additional fourteen DFO staff were suggested, bringing the total to twenty-one. I sought interviews with all but four of these individuals, interviewed two fishery managers and had discussions on particular points regarding co-management (eg, regulations governing co-management agreements, use of fish policy) with three others and received landed value data from another. I was otherwise unsuccessful in eliciting a response from DFO staff.

Towards the end of the project I was advised by senior management in DFO that I should not interview DFO staff as that could generate divergent, personal views on co-management. Rather, for the DFO corporate statement on co-management, senior management advised me to take my lead from the department’s Framework and Guidelines for Implementing the Co-Management Approach. DFO acknowledges that there are significant discrepancies between that policy and its implementation and sees the planned October workshop on Sustainability through Co-Management as the best venue for beginning to address outstanding issues.

Documents reviewed are listed in Appendix B.

Scope

The terms of reference for the assignment state that "The review will be limited to regular commercial fisheries licensed by the commercial licensing unit of DFO and will not include recreational or Aboriginal fisheries"

Given the list of contacts provided in the Terms of Reference and additional contacts suggested during interviews, I have managed to gather information on co-management on the following fisheries.

• Sablefish
• Halibut
• Groundfish Trawl
• Geoduck
• Prawn Trap
• Shrimp
• Sea Cucumbers
• Green Sea Urchins
• Red Sea Urchins
• Krill
• Herring Roe
• Herring Spawn-on-Kelp
• Sardine
• Salmon

I have not yet been able to interview industry representatives for the following fisheries.

• Rockfish Hook & Line
• Depuration Clam
• Crab
• Tuna

What is Co-Management?

Before answering even the most basic question such as "which fisheries are co-managed?" co-management needs to be defined.

What Does Co-Management Mean to DFO?

The Framework and Guidelines are DFO’s principal statement on co-management. A review of the Framework and Guidelines identifies the following key points regarding DFO’s approach to co-management (see Appendix C for more detail, and the document itself for a full description).

• Co-management as currently envisioned by the department is a two-step process.
  Step 1 focuses on the Integrated Fisheries Management Plan which is required of all fisheries and is created in consultation with resource users.
  Step 2 centres on the Joint Project Agreement which is a voluntary but legally binding agreement describing each party’s (DFO and harvesters) roles and responsibilities. Not all fisheries are expected to progress to the second step.
• Co-management provides the basis for DFO and harvesters (and other stakeholders as appropriate) to work together to achieve fishery management objectives. These objectives include conservation, economic sustainability, environmental sustainability and shared responsibility and accountability.
• Co-management allows each party to concentrate on activities it is best-suited to undertake.
• Under the current Fisheries Act the ultimate authority of the Minister in matters of fisheries management must be preserved.
• DFO’s goal, in part, is to promote mutual respect, team work, professionalism and accountability with respect to the management of the fishery.
• The co-management approach is intended to provide resource users with a more stable operating environment (through multi-year IFMPs) and a greater say in decisions that affect day-to-day operations.

What Does Co-Management Mean to Industry?

Industry representatives were asked what co-management means to them. In this section, I summarise what co-management means to industry representatives (as expressed in my interviews) and what they view as the principal problems with the way co-management is currently implemented. The latter are some of the issues that need to be addressed and discussed at the October workshop.

These dominant themes cited by industry representatives include:

• Defined roles and responsibilities.
• Shared responsibilities.
• Shared accountabilities.
• Shared decision-making.
• Shared costs.

Apart from the Alliance’s inclusion of providing "security of access to the resource for tenure holders", these views match the Alliance’s stated objective for co-management (see page *).

Industry representatives also share the DFO view that co-management includes working together to achieve goals and objectives.

• Shared purpose of sustainable, viable fisheries.

Both Fisheries and Oceans Canada (in its Framework and Guidelines document) and industry representatives indicated that economic viability is one of the goals to be pursued. Industry representatives almost unanimously cited incidents in which some DFO staff tended to ignore or deny the economic objective in practice. This is an issue that needs to be clarified and resolved.

Many industry representatives noted that true co-management must be a:

• Two-way street

That is, to echo the words of Fisheries and Oceans Canada’s Framework and Guidelines document, there must be mutual respect, team work, professionalism and accountability. Co-management cannot function properly if one party is not listening or is dictating how co-management will work. This was another issue raised by industry representatives, citing situations in which Fisheries and Oceans Canada staff would "lay down the law" and threaten not to open fisheries if its dictates were not carried out. Clearly the relationship between Fisheries and Oceans Canada staff and fishery participants in co-managed fisheries needs to be clarified.

Industry representatives identified that DFO does not:

• Speak with one voice.

If co-management is to work, the department must enter into co-management agreements with all branches and units "in the loop". Industry representatives related their frustrations at having reached agreements with fisheries scientists and/or managers, only to have some other part of the organisation "veto" the agreement. Whether this is misunderstanding or mis-communication, whether the error, if there is one, lies with those who made the original agreement or those who refused to go along with it, the issue needs resolution. Just as DFO requested that I refer to the Framework and Guidelines as my source on their views of co-management, so as to ensure they "spoke with one voice", similar discipline is required in the implementation of co-management.

Some industry representatives described "objectives-based" fishery management as:

• Market driven fisheries.

This takes the goals and objectives a step beyond what DFO describes in its Framework and Guidelines document but, if one is going to have fisheries, it makes a lot of sense to take what the market demands as a starting point and to work backwards from there (ie, to manage fisheries, subject always to conservation of course, to best meet market demand). Whether DFO accepts this approach and/or can integrate it into its Framework and Guidelines for Implementing the Co-Management Approach needs to be discussed.

Finally, two industry representatives used the phrase:

• Equal partners.

This speaks to the issue of the "two-way street" but also to something more. Equal partners have equal voices. Vetoes have no part in such a relationship.

Under the current Fisheries Act, DFO states that "the ultimate authority of the Minister in matters of fisheries management must be preserved." This is contested by at least one industry organisation which argues that the Minister’s authority can be fettered by regulations established by Governor in Council. This approach to "providing security of access to the resource for tenure holders" could, it is argued, be implemented under the current Fisheries Act. The approach involves having the Governor in Council implement regulations that specify fishery allocations and the number of commercial licenses to be issued in the fishery. While fishery regulations can be changed, they are far more difficult to change (and involve a formal and more transparent process) than licensing policy and Ministerial discretion. Therefore, they provide greater security and stability to license holders and industry participants.

DFO, for its part, has stated that, for the foreseeable future, industry and the department will continue to operate under the current Fisheries Act. In its first recommendation, the Panel Studying Partnering "urged the Minister of Fisheries and Oceans not to go forward at this stage with legislation for partnering" (PSP, page 22).

Industry representatives, especially those representing fisheries that are relatively well developed in terms of co-management (eg, sablefish and geoduck) are particularly interested in what they see as critical issues of licencing, allocation and access. Given the Seafood Alliance’s stated goal (see page *), this is an important issue for discussion.

Which Fisheries Can be Considered Co-Managed?

Using DFO’s definition from its Framework and Guidelines document, all of the fisheries included within the scope of this assignment can be considered co-managed in that they all have IFMPs.

Further applying DFO’s definition of co-management, all fisheries with IFMPs have JPAs except the three fisheries listed below.

• Shrimp Trawl.
• Herring Spawn-on-Kelp.
• Salmon.

Based on interview information the following continuum can be constructed.

The preceding categorisation is tentative and should be discussed further at the Seafood Alliance October workshop. The category definitions (first row of table above) need further work. Once that is done, the assignment of fisheries to categories should be re-visited.

What Does Co-Management Entail for Each Fishery?

• The following table summarises the main elements of co-management by fishery. Additional detail is provided in Appendix D.
• DFO Science/Management/Enforcement Support refers to payments to DFO by fishery associations/societies to cover DFO salaries, benefits, overtime, O&M and capital.
• Contract Science/Management/Enforcement refers to worked carried out by third party contractors funded by fishery associations/societies.
• DMP refers to Dockside Monitoring Programs.
• C&P refers to DFO Conservation & Protection.

What Specific Federal Regulations or Policies Allow for Co-Management Agreements?

The Minister’s authority to enter into agreements is specified in the Fisheries Development Act.

Section 3.1 of the Fisheries Development Act authorizes the Minister to undertake projects for specific purposes.

3. (1) The Minister may undertake projects

(a) for the more efficient exploitation of fishery resources and for the exploration for and development of new fishery resources and new fisheries;

(b) for the introduction and demonstration to fishermen of new types of fishing vessels and fishing equipment and of new fishing techniques; and

(c) for the development of new fishery products and for the improvement of the handling, processing and distribution of fishery products.

Section 3.4 of the Fisheries Development Act authorizes the Minister to enter into an agreement with an external group.

3. (4) The Minister may enter into an agreement with any person for the joint undertaking of any project that the Minister is authorized to undertake under subsection (1) or for the payment to any person of contributions in respect of the cost of any such project undertaken by that person.

With regard to financial authority, as a staring point, any funds paid to a federal department must go to the Consolidated Revenue fund. There are two exceptions to this general rule.

1. For purposes of cost recovery, a department can seek parliamentary approval to retain funds. To do so, the funds must be tied to specific programs or activities and the department must make a clear business case that those activities advance the goals of the department and the interests of those from whom the fees are being collected. Parliamentary approval must be granted before such cost recovery can be undertaken.
2. The Minister has a standing authority under section 21.1 of the Financial Administration Act to receive money from an external group that wishes, voluntarily, to provide funds for a specified purpose.

   21. (1) Money referred to in paragraph (d) of the definition "public money" in section 2 that is received by or on behalf of Her Majesty for a special purpose and paid into the Consolidated Revenue Fund may be paid out of the Consolidated Revenue Fund for that purpose, subject to any statute applicable thereto.

DFO’s ability, with parliamentary authority, to recover costs was formerly used as a tool for collecting co-management fees in the halibut, sablefish, and prawn trap fisheries. A departmental policy has since been put in place suggesting that, as licence fees are a charge for access to the resource, the use of this approach to collect co-management fees is inappropriate.

The department uses its standing authority to receive monies in co-management. This authority is voluntary and applies only to the receipt of funds, not their collection.

Section 22.1 of the Fisheries (General) Regulations establishes the Minister's authority to set specific conditions of licence for harvesters. Conditions of licence specified in sub-sections (k), (l), (m), (n), (o) and (p), eg, are used to ensure the collection of information necessary to properly control and manage commercial fisheries. Examples where such licence conditions are used to support co-management include the sablefish and geoduck fisheries.

22. (1) For the proper management and control of fisheries and the conservation and protection of fish, the Minister may specify in a licence any condition that is not inconsistent with these Regulations or any of the Regulations listed in subsection 3(4) and in particular, but not restricting the generality of the foregoing, may specify conditions respecting any of the following matters:

(a) the species of fish and quantities thereof that are permitted to be taken or transported;

(b) the age, sex, stage of development or size of fish that are permitted to be taken or transported;

(c) the waters in which fishing is permitted to be carried out;

(d) the location from which and to which fish is permitted to be transported;

(e) the vessel from which and to which fish is permitted to be transhipped;

(f) the period during which fishing or transporting fish is permitted to be carried out

(g) the vessel that is permitted to be used and the persons who are permitted to operate it;

(h) the type, size and quantity of fishing gear and equipment that is permitted to be used and the manner in which it is permitted to be used;

(i) the specific location at which fishing gear is permitted to be set;

(j) the distance to be maintained between fishing gear;

(k) information that the holder of the licence shall report to the Department prior to commencement of a fishing trip with respect to where and when fishing will be carried out, including the method by which, the times at which and the person to whom the report is to be made;

(l) information that the master of the vessel shall report to the Department from sea, including the method by which, the times at which and the person to whom the report is to be made;

(m) the location and times at which landing of fish from the vessel is permitted;

(n) verification by an observer of the weight and species of any fish caught and retained;

(o) the method permitted for landing of fish from the vessel and the method by which the weight of the fish is to be determined;

(p) records that the master of the vessel shall keep of any fishing activity carried out under the licence or of the sale or transporting of fish caught under the licence, including the manner and form in which the records are to be kept, the times at which and the person to whom the records are to be produced and the period for which the records are to be retained;

(q) the type, size and colour of containers to hold or transport fish and the marking of such containers for identification of the source of the fish;

(r) the marking or tagging of fish for identification of the source of the fish;

(s) the segregation of fish by species on board the vessel;

(t) the time within which findings and data obtained as a result of fishing for an experimental or scientific purpose are to be forwarded to the Minister;

(u) the manner in which fish caught for an educational or public display purpose are to be held and transported;

(v) the species and quantities of fish that may be released or transferred under a licence issued under Part VIII;

(w) the period during which the release or transfer of fish is to be carried out under a licence issued under Part VIII;

(x) the waters or fish rearing facility into which the fish are to be released or transferred under a licence issued under Part VIII;

(y) the waters or fish rearing facility from which the fish are to be taken under a licence issued under Part VIII;

(z) the method and manner of transporting the fish to be released or transferred under a licence issued under Part VIII; and

(z.1) the method of disposing of any water, container or other material used in the transporting of fish under a licence issued under Part VIII.

What Elements of Co-Management are Cost Recovered?

"Cost recovery" has a specific meaning in legislation. The term is used to refer to situations, described in the preceding section, in which the department seeks and obtains parliamentary approval to collect funds tied to a particular program or activity. In that strict sense of the phrase, there is no cost recovery in co-management. There has been none since the introduction of the DFO’s policy recognising licence fees as a charge for access to the resource (see the preceding section).

In this section, cost recovery is interpreted more broadly to mean "funded in whole or in part by industry."

The main elements of co-management that are cost recovered are Science, Management and Enforcement (Conservation & Protection).

The table summarising co-management elements (see page *) provides a listing by fishery of co-management elements that are funded in whole or in part by industry.

Further detail on co-management elements that are cost recovered is provided in Appendix D.

What Mechanisms are Used to Recover Costs?

A number of mechanisms are used to collect monies for co-management.

What are the Benefits of Co-Management?

Industry representatives were asked their opinions of the benefits of co-management to fishery participants (and non-participants, though the focus was on the former).

Benefits to Licence Holders

Some industry representatives objected to the use of the term "licence holder" preferring to talk about the benefits to "harvesters". I believe respondents were speaking of benefits to those who harvest fish whether they "own" or lease a commercial fishing licence.

The dominant themes that emerged from my interviews with industry representatives reflect again the stated objective of the BC Seafood Alliance and responses to the question asking industry representatives for their definition of co-management.

• Economic/financial viability.
• Greater certainty.
• Greater stability.
• Long-term sustainability.
• Greater control over economic well-being.
• Security of access.

The foregoing may be classified as "outcome" benefits; some industry representatives also identified "process" benefits of co-management including:

• More transparent process.
• Better understanding of the decision-making process.

Reflecting some of the frustrations felt by industry representatives in their dealings with DFO, some industry representatives cited as a benefit of co-management.

• Reasonable regulations that achieve DFO objectives.

The point here is that industry representatives recognize the need for DFO regulations but want them to be as efficient and effective as possible, achieving DFO objectives with the least negative impact upon industry objectives.

Another theme that emerged from the interviews was industry participation. This was variously described.

• Licence holders develop the fishery.
• Grow fisheries.
• Recognition that harvesters can participate in science.
• Having a say in the direction and development of the fishery.

A more minor theme mentioned by one or two industry representatives concerns:

• Employment.
• Diversification and sustainability of coastal communities.

One industry representative put it this way: "There can be no drawbacks or disadvantages at all to appropriately defined and properly operated co-management systems."

Several industry representatives took an extremely negative view, describing co-management as practiced today as nothing more than an excuse for DFO to download costs onto fishers.

Finally, a more subtle theme that emerged concerns the effect of co-management upon licence holders and fishery participants: co-management fosters an enhanced attitude towards resource stewardship. Under co-management, licence holders tend to take a longer-term view of the fishery, focusing less on annual catches and values and more on the long-term value of the fishery as an asset. As one industry representative put it: "the more involved licence holders are and the more they have invested, the more interested they become in ensuring the efforts and investments are productive and beneficial."

Benefits to Fisheries and Oceans Canada

The questions included in my terms of reference included: "benefits to the fishery". I tried to distinguish benefits to DFO from benefits to the resource.

The major themes enunciated by industry representatives regarding benefits to DFO were captured by the Panel Studying Partnering: "Over the long-run, co-management can enable DFO to do more with less" (PSP, page 21). This theme was characterized by industry representatives as follows.

• Being able to get the job done (ie, in the context of limited financial resources).

Flowing from this primary benefit would be:

• Better (more timely and accessible) data.
• Better and faster decision-making.
• Improved sustainability and reduced risk.
• Better management
• Better science

Some of the themes cited as benefits to licence holders were reflected here as benefits to DFO as well. For example.

• Use expertise of fishers.
• Closer working relationship between DFO Management and Science and industry

In addition to these "up-side" benefits of co-management for DFO, several industry representatives mentioned some "down-side" benefits. In essence, shared responsibility may help avoid problems in the fishery and, when they do occur, the blame can be shared by both parties.

• Stay out of trouble.
• Shared responsibility.
• Credible system (to the public at large).
• Fewer complaints.

The same might be said for the political lobbying that sometimes plagues fishery management and operations. As one industry representative put it: "no politician worth his salt would go against an agreement struck between the department and industry, both speaking with a single voice."

Finally, one industry representative put an interesting perspective on the benefits of co-management: "fisheries are becoming (much) more complex to manage (eg, by-catch, seabirds, mammals, selective fishing). It will be much more difficult to successfully manage such fisheries without cooperation. And cooperation must be based on trust."

Benefits to the Resource

Ultimately, the benefits of co-management to DFO and those to the resource matched pretty closely, likely because DFO is seen as the "keeper of the resource".

• Better data.
• Better decision-making.
• Better sustainability.

One industry representative told me a story of his organisation funding scientific research/stock assessment work that looked like it might result in a reduction of the TAC and quotas. Some, less knowledgeable, members of his organisation cited this as evidence of the failure of co-management. The industry representative was quick to point out that with better scientific data, better fishery management and sustainability can be ensured, potentially avoiding unexpected problems in the future that could lead to even larger reductions or complete closures.

Information is good, especially when it is good information. Having fishers involved in research and stock management increases the credibility of the information and brings the parties together in deciding how to address new information. There is a clear willingness on the part of industry representatives interviewed and their constituents to contribute to and participate in a well-run fishery based on sound scientific data.

Benefits to the Market

Industry offered different views on how co-management benefits seafood markets and marketing. Their views depend in part on which fisheries they are in. About one-half of those interviewed saw opportunities for smoothing the flow of fish into plants facilitating improved stability of supply to market (ie, ensuring maintenance of market share). The other half of industry representatives interviewed thought that co-management tends to focus the mindset of licence holders on economic returns.

Some industry representatives noted that market benefits really arrived with IQs not co-management.

Some who see the essence of co-management as a move towards more market-driven fisheries recognize that the growing importance of globalisation demands that fisheries become more market driven.

Benefits to Processors

As with benefits to the resource and the management agency, industry representatives interviewed tended to combine benefits to markets with benefits to processors (at least to some degree).

There may be some benefits of co-management to processors in terms of smoothing the flow of product to the plant (eg, salmon) and that would naturally lead to lower costs and more efficiency. While such effects may be more likely attributable to IQs rather than co-management, it is possible that fishing could be more spread out under co-management through cooperative fishery management planning.

At the very least, co-management was seen as improving working relationships between harvesters and processors.

Processors may also benefit, of course, to the extent that they are licence holders. In that case, benefits are the same as accrue to licence holders.

It was suggested by one industry representative that processors have largely been left out of co-management and that cost sharing should be shared between harvesters and processors.

Benefits to Others

Several industry representatives mentioned that co-management had resulted in expanded, improved and more productive relationships with First Nations.

It was suggested by some industry representatives that NGOs should have more confidence in fisheries that are co-managed because roles and responsibilities are written down and accountability should ensure that written agreements are put into practice. Co-management agreements should include measurable objectives and performance measures to assess success and identify areas that need improvement. Co-management should be used to build confidence with environmental groups.

A similar argument apples to the Canadian public at large who in recent years have become more aware of fisheries and their management. Co-management based on sound science and cooperative management should be an advance in fisheries management that should be welcomed by the people of Canada. Fisheries as a result should become more sustainable and therefore more socially acceptable.

How Well is Co-Management Working?

The opinions of industry representatives I interviewed on how well co-management is working (at present) were all over the map. Responses ranged from "excellent" to "working reasonably well" to "not working at all."

This is not to say that industry representatives disapprove of co-management: they just want it to work better. Industry representatives were virtually unanimous in expressing their opinion that:

• Co-management is the way to go and should be developed further.

The complaints of industry representatives regarding what is not working in co-management also range all over the map. Their complaints depend in part on how far along the co-management continuum their fishery has progressed to date. Industry representatives of fisheries that are far along the co-management continuum, for example, are concerned about "end game" issues such as security of access, licencing and allocation. Those fisheries in which co-management is not well developed have more basic concerns such as mechanisms for generating/collecting co-management funds and inequities in application of the Use of Fish policy. These are fundamental issues that need to be addressed if co-management is to continue to be developed in those fisheries.

One dominant theme that emerged from the interviews of industry representatives was:

• Lack of acceptance/action on economic objectives.

This has been touched on above (see page *). In all my interviews it is the point most often raised by industry representatives. With few exceptions the industry representatives to whom I spoke related situations of DFO ignoring economic objectives or denying their relevance to fishery (co)management.

The department’s Framework and Guidelines document states clearly that economic objectives are an integral part of co-management.

Co-management provides the basis for DFO , resource users and other stakeholders to work together to achieve our fisheries management objectives. These objectives include:

1. managing fisheries and fish habitat to conserve and protect stock abundance, to restore depleted stocks and to maintain biological diversity;
2. managing fisheries to contribute to an economically and environmentally sustainable, self-reliant industry and provide positive contributions to communities and the Canadian economy;
3. achieving shared responsibility and accountability for the management of fisheries;…" (FGICA-I, page 5).

Furthermore, the Guidelines for Objectives-Based Fisheries Management (Draft 3, December 18, 2000) state that:

The items that will be included in the development of the IFMPs will include…the establishment of clear and measurable fisheries management objectives based on the biological and social/economic elements of the fishery that are primarily related to harvesting plans (page 3, emphasis added).

Other important themes that emerged in the interviews included:

• The need for DFO to "speak with one voice".
• The need for relationship building between harvesters and DFO.
• The need for increased trust between DFO and harvesters.
• The importance of a respectful, professional relationship between harvesters and DFO.
• The importance of co-management being a "two-way street".
• Not all DFO staff are familiar with co-management and its goals, benefits and objectives.

DFO has operated in a "command and control" manner since its inception. Co-management with harvesters, at least as it is envisioned in the department’s Framework and Guidelines document and by industry representatives, is a significant change in the department’s modus operandi. To staff of long tenure, the shift to co-management may not be easy.

The Panel Studying Partnering put it this way: "The Panel believes that co-management and the partnering model are antithetical to the tradition of paternalism" (PSP, page 21).

That industry representatives tended to focus on what they believe is wrong with co-management should therefore not be seen as disapproval of the concept, only their desire for co-management to work better.

As one industry representative put it: "even though there are problems with co-management, industry is better off with it than without out." Though not universally shared by industry representatives, this view is supported by the vast majority of industry representatives to whom I spoke.

Another industry representative said: "co-management has become a way of life."

Co-Management Arrangements: Flexibility vs Consistency

All industry representatives saw the need for flexibility in co-management arrangements reflecting differences among fisheries. Several suggested the need for policy or guidelines, that is, a consistent framework from which at least to begin (it could still be applied with some flexibility). No one is arguing for complete uniformity, not even those (few) who see an equity issue.

Two major equity issues were identified by industry representatives.

• In the herring fishery, in the application of the Use of Fish policy between the roe herring and spawn-on-kelp fisheries.
• Between existing and new/emerging fisheries with regard to payment of costs (in the former, costs are shared between DFO and industry; in the latter, industry pays 100% of costs).

One industry representative put it this way: "different fisheries are ready for different things. Uniformity would not be appropriate."

Another industry representative pointed out that "the flexibility benefits outweigh any inconsistency costs."

In fact, complete equity could cause problems especially for less lucrative fisheries. If a fishery cannot afford to pay co-management costs paid by other fisheries, should it be left behind? At least one industry representative argued adamantly that co-management should be first, then cost sharing (ie, inability to share costs should not be a reason to stop development of co-management). Another industry representative thought that imposing costs that might seem insupportable by a less lucrative fishery could bring some discipline into decision-making and catalyse fishery development in general and co-management in particular.

An equity issue that may arise in the future with integration of fisheries was identified. Fisheries integration will see licence holders adding species to their licences. In that case, care must be taken to ensure that all those benefiting from harvest of a particular species share in paying the co-management costs for that species. Otherwise, an equity issue will arise.

Economics of Co-Management

Co-Management Costs vs Landed Value

Appendix E contains a table comparing co-management costs and landed values. Landed values shown are average values for the period 1997-2000.

Costs Including Licence Fees

Total costs including licence fees by fishery range in absolute terms from $6,000 to almost $5 million.

As a percentage of average landed value (1997-2000), costs including licence fees range from 1% to 29%.

Average costs including licence fees range across fisheries from $300 per licence to over $52,000 per licence.

Cost Excluding Licence Fees

When licence fees are excluded from the cost totals, the range across fisheries in absolute terms (ie,total costs) is from $4,000 to almost $4.25 million.

The ratio of costs excluding licence fees to average landed value (1997-2000) ranges across fisheries from less than 1% to 9.3%.

Average co-management costs (excluding licence fees) range across fisheries from about $200 per licence to almost $36,000 per licence.

Co-Management Costs vs DFO Costs

DFO has informed me that it is not possible for them to provide a breakdown of departmental costs by fishery.

Certain departmental costs are included in some of the JPAs but I was advised not to rely on such figures as there are significant cost elements missing.

I was further advised that any DFO costs by fishery would not be sufficiently reliable for the comparative purposes of this assignment as the department’s financial systems are not set up to identify costs by fishery.

Co-Management Factors

This section deals with the question, what factors support (or detract from) greater co-management?

The most commonly cited factor lending support to co-management was:

• Resolution of allocation.

The Panel Studying Partnering recognised this point: "Allocation … goes to the heart of virtually every difficulty in the fishery. ‘You solve the allocation issue and you will find everyone in the industry supporting the partnering concept’" (PSP, page 23).

Also cited as factors contributing to development of co-management were:

• Leadership in industry.
• Leadership from DFO.

The most oft-cited factor limiting development of co-management was

• Lack of an industry organisation.

DFO requires that JPAs be signed with "a party (parties) who are representative of a fishery…"(Framework and Guidelines , Vol III, page 4). Most of the industry representatives who I interviewed were involved in fisheries that have at least a reasonably effective organisation. The question then is not whether an organisation exists but whether it is supported by all, or enough, of the harvesters involved in the fishery. Meeting this condition requires a certain amount of common vision amongst the harvesters in a fishery and this is not always the case. The shrimp and salmon fisheries were both cited as fisheries in which lack of sufficient common purpose/vision was an obstacle to co-management.

The only other factors that were frequently mentioned by industry representatives (about one-half of those to whom I spoke) as constraints to co-management were:

• Large number of licence holders.
• Low inherent value of fisheries.

Both deserve comment. With regard to the first, large number of licence holders, the halibut fishery with 435 licences and in which co-management is relatively well developed is a strong counter example. Clearly strong leadership, common purpose/vision and an effective industry organisation (the latter depending in part on the former) can overcome large numbers.

With regard to low inherent value of fisheries, there were some industry representatives who took pains to point out that low inherent value need not be a constraining factor (the green sea urchin and sea cucumber fisheries were cited as examples).

Other factors mentioned by at least one industry representative as obstacles to co-management include:

• Harvest agreements.
• Lack of mechanism(s) to force harvesters to join industry organisations.
• Lack of trust.
• Divided fisheries (as the salmon and shrimp examples cited above).
• Lack of acceptance of and commitment to co-management by DFO and harvesters.
• Cost recovery.
• Historical behaviour (by which is meant competitive fisheries with values such as working harder and fishing faster and longer in a race for landings).

While each of the themes listed above was cited by only one or two industry representatives, they are nevertheless important. The point is that, whatever the factors limiting development of co-management in a fishery, those are the factors that need to be addressed. There is no "one size fits all" answer to this question.

Categorisation of Fisheries that are not Co-Managed

I was asked to categorize fisheries that are not co-managed according to whether they are candidates to co-management:

• Immediately.
• Within two years.
• Within five years.
• Never.

Industry representatives had a great deal of difficulty responding to this question. The reason, I believe, is that it is not so much a matter of timing as which factors (discussed in the previous section) are at play in each fishery. Some examples of fisheries that are at the lowest end of the co-management continuum and the factors that industry representatives feel are most responsible for holding back development of greater co-management are listed below.

• Herring spawn-on-kelp: harvest agreements and lack of access to funds through Use of Fish policy.
• Shrimp: fractured constituency; lack of mechanism to collect co-management funds; lack of mechanism to require payment of co-management fees; low value fishery.
• Salmon: fractured constituency (eg, multiple areas, single and double/triple licencing); historical behaviour.
• Krill: lack of mechanism to require harvesters to belong to industry organisation; low market value.

In general, industry representatives believe that all fisheries have the potential to be co-managed (especially if cost sharing is not imposed as a condition of co-management in less lucrative fisheries).

Summary

In this section I summarise issues arising out of my interviews with industry representatives.

Security of Access

One of the most significant differences between DFO and industry regarding co-management is the issue of providing "security of access to the resource for tenure holders." This is a stated objective of the Seafood Alliance. DFO’s Framework and Guidelines state that "under the current Fisheries Act, the ultimate authority of the Minister in matters of fisheries management must be preserved." DFO has stated that, for the foreseeable future, industry and the department will continue to operate under the current Fisheries Act. The Panel Studying Partnering in its first recommendation has "urged the Minister not to go forward at this stage with legislation for partnering."

An approach to increasing security of access to the resource has been developed by one of the industry associations which has obtained a legal opinion that the proposed approach is (extremely likely to be) workable (see page *). DFO (albeit without detailed analysis) believes the approach is not possible. In any event, the department seems highly unlikely to move in any direction that fetters the Minister’s ultimate authority.

In my view, this is the single biggest barrier to the Seafood Alliance achieving its stated objective. Issues concerning the workability of co-management as it exists today can be discussed and, if not resolved, at least improved. DFO has stated its willingness to work on such issues, seeing the October 2002 Seafood Alliance workshop as an opportunity to begin that process. Security of access threatens to remain intractable in the foreseeable future without a significant shift in DFO’s position on the issue.

Day-to-Day Working of Co-Management

Co-management is not functioning as industry believes it should nor, I would add, as DFO thinks it should according to its written statements on the subject. Industry representatives identified a number of related issues that are suitable topics for discussion including:

• Unilateral actions by the department.
• Lack of recognition in some instances of economic objectives in fishery management.
• An apparent lack of coordination amongst DFO staff on co-management issues (ie, intra-departmental disagreements).
• Different interpretations and applications of co-management by DFO staff.

Economic Objectives in Fishery Management

Economic objectives in fishery management, mentioned above in the context of the day-to-day working of co-management, deserve special attention. Along with security of access, this is perhaps the most important issue arising out of this status report. Economic objectives are the raison d’etre for conducting fisheries. DFO recognises this in principle (see page *) but according to industry representatives is not incorporating the economic mandate in practice. Some topics for discussion include:

• How can fisheries management be more market-driven?
• How can decision be made in practice that recognise both conservation and economic mandates?
• What is required to achieve sound fishery management decision-making in practice that recognises both mandates?

Working Definition of Co-Management

Some industry representatives have suggested that what is required is a definition and some method of measuring where each fishery sits along the continuum. This was alternatively put as "measuring whether co-management is working". The suggestion was also made that the definition be cast in terms of outcomes (eg, improved profitability, increased economic benefits, less bycatch and discards, more/better stock assessment data, increased accountability, less conflict).

I have offered a tentative five-stage continuum defining co-management (see page *). My attempt needs considerable work still and could be a topic of discussion at the October work shop. As the definition of each of the "levels" in the continuum is fleshed out, indicators could be taken directly from those definitions (eg, does the fishery have a signed JPA? Does the fishery have a multi-year JPA?). I find the idea of a definition cast in terms of outcomes appealing since those outcomes are (some of) the ultimate objectives that industry and DFO is seeking in co-management. A significant problem in implementing an outcomes-based approach is distinguishing changes in outcomes variables (eg, profitability, by-catch, data quality) that would be attributable to co-management from changes in those same variables due to changes unrelated to co-management. Clearly, this issue needs considerably more discussion.

Activities Included in Co-Management

The table summarising co-management activities (see page *) and the detailed list of co-management activities appearing in Appendix D (page *) show clearly the differences among fisheries in terms of what is included in co-management. In part this is due to the different stages of co-management so far achieved by fisheries. Industry representatives generally acknowledge the need for flexibility in co-management arrangements and some suggested there could be an over-riding framework (that might, eg, define consistent co-management scopes for fisheries at each level of the co-management continuum). The general view is that the benefit of flexibility outweighs the "cost" (disadvantage) of inconsistencies.

In my opinion, this is a less important issue as fisheries will tend to take on co-management at different speeds and perhaps in different orders. Nevertheless, it is probably a good idea for industry and DFO to clarify activities that should be included in co-management, to identify situations where inequities exist and to decide which inequities are "worth the flexibility benefit" and which should be addressed by bringing co-managed fisheries "into line with one another."

Funding Co-Management

Industry must have the tools to participate in co-management. A fundamental tool is a mechanism to collect co-management funds from licence holders. DFO has established a policy in recent years that prevents it from using fees charged for access to the resource as a tool for collecting fees to fund co-management. New tools are therefore required. These could include broader application of Use of Fish (currently used in six co-managed fisheries) and new mechanisms.

DFO Management Costs

DFO was unable to supply its costs of managing specific fisheries (ie, including Science, Management, Enforcement; salaries. O&M, Capital and Overhead). The department has taken some steps in the past to examine whether this could be done but has been advised by external consultants that its current financial system will not support attribution of costs to fisheries.

Conclusions & Recommendations

Among those to whom I spoke, in industry and in DFO, there is support for co-management and good will to make it work. It is clear to me that co-management offers significant benefits to industry and to the department. The key is to make it work.

It is my conclusion that there are some issues that can be addressed in the short-term, starting at the Seafood Alliance October workshop. These are:

• The day-to-day working of co-management: how to ensure that DFO staff clearly understand and apply co-management in the spirit in which it is described in the department’s policy statements on the subject.
• Recognising economic objectives and incorporating them into co-management decision-making.
• Establishing efficient and effective funding mechanisms for co-management.

I recommend that these issues be tackled first as their resolution will expedite the functioning of co-management as it exists today and there seems to be the will on the part of both parties (DFO and industry) to tackle these issues.

In the medium-term, industry should continue to refine the definition of co-management and ways of measuring both where fisheries are in the co-management continuum and how well it is working, and DFO should establish whatever financial and reporting mechanisms it requires to be able to identify fishery-specific costs. Both parties can pursue the issue of which activities should be included in co-management and the inherent flexibility/equity trade-off.

Security of access is the thorniest issue. I leave it to the long-run primarily so that it does not interfere with discussion and resolution of short-and-medium-term issues. It is a very important to industry, especially those fisheries furthest along the co-management continuum but it is the most troublesome issue to the department which has been urged not to amend the Fisheries Act in ways that would facilitate resource users having a say access, licencing and allocation. Even on the practical front of what can be done regarding this issue within the current Fisheries Act, the parties appear to have strongly opposed views. Without denigrating the importance of this issue, it should not in my view be allowed to interfere with progress in other areas where there seems to be greater chance of progress in the short-to-medium-term.
 

Appendix A: Interview List of Representatives of Fishing industry Organizations

I attempted to contact each of the individuals included in the list in the table on the next page. I have indicated those who provided an interview.

Appendix B: Documents Reviewed

In preparing this report, I have reviewed the following documents. Some of the industry representatives I interviewed also supplied me with documents as part of the interview process.

I also made reference in many cases to fishery management plans available on DFO’s web site.

Partnering the Fishery: Report of the Panel Studying Partnering, Donald J. Savoie (chair), Gabriel Filteau and Patricia Gallaugher.
Framework and Guidelines for Implementing the Co-Management Approach. Volume I: Context, Concepts and Principles. Volume II: Integrated Fisheries Management Plans. Volume III: Joint Project Agreements. January 1999.
 
 
Appendix C: Excerpts from DFO’s Framework and Guidelines for Implementing the Co-Management Approach

In its Framework and Guidelines (page 3), Fisheries and Oceans Canada defines

a standard framework for co-management involving two steps. Step One is based on the Integrated Fisheries Management Plan (IFMP). An IFMP is required in most fisheries and is created in consultation with resource users usually through an advisory committee. Participation in the IFMP process is considered (by DFO) the basic form of fisheries co-management.

The second step in the co-management framework is a legally binding Joint Project Agreement. These voluntary agreements spell out the roles and responsibilities of DFO and resource users with respect to specific co-management projects. Not all fisheries will progress to this second step of co-management.

While acknowledging that co-management originated in the advisory committees of thirty years past, an IFMP barely registers on the co-management scale envisioned by industry. Industry’s interest by and large is the Joint Project Agreement, what it includes and can include under current legislation and, whatever it contains, how to make it work better in practice.

On page 5 of the Framework and Guidelines, Fisheries and Oceans Canada offers the following.

Co-management provides the basis for DFO, resource users and other stakeholders to work together to achieve our fisheries management objectives. (Some of these) objectives include:

1. managing fisheries and fish habitat to conserve and protect stock abundance, to restore depleted stocks and to maintain biological diversity;
2. managing fisheries to contribute to an economically and environmentally sustainable, self-reliant industry and provide positive contributions to communities and the Canadian economy;
3. achieving shared responsibility and accountability for the management of fisheries.

And later, on page 6, the Framework and Guidelines state:

Other than for conservation requirements, it is generally accepted that government should be less intrusive in the management of the fishery. Renewed fisheries management allows participants in the fishery and DFO to concentrate on activities they are respectively best-suited to undertake.

Under the current Fisheries Act, the ultimate authority of the Minister in matters of fisheries management must be preserved.

DFO will continue having a strong presence in the areas of policy development, scientific research, aboriginal affairs, international issues and in conservation and protection of the resource through required enforcement activities. DFO will ensure that conservation of fisheries remains it first priority and that conservation governs its decision-making process and the development and implementation of Integrated Fisheries Management Plans.

With co-management, participants in fisheries will be encouraged to play a greater role in the identification and implementation of management measures and activities related to their specific fishery and to share responsibility for the management of the fishery. This could involve specific management issues as well as contributing to data collection for science, reporting systems, sampling, supervising local initiatives, etc.

… DFO’s goal is to promote mutual respect, team work, professionalism and accountability with respect to management of the fishery.

The co-management initiative has the potential to provide resource users with a more stable operating environment through multi-year Integrated Fisheries Management Plans and to provide resource users and other stakeholders a greater say in decisions that affect day-to-day operations.

Fisheries and Oceans Canada describes the first of its two-step co-management approach as follows.

The IFMP is required for all fisheries as it sets out conservation requirements and explains how the fishery will be managed. IFMPs are developed with input from a variety of DFO sectors and all sectors of the fishery. Depending on the fishery, other stakeholders may be involved (eg, provinces, processors). It is the cornerstone of the fisheries management process and the tool by which DFO ensures that conservation requirements and viability goals are achieved while forming the basis for a more ecological approach to fisheries management. The IFMP is not legally binding. The IFMP process builds on a consultation process that is open and transparent re-enforcing the concept of consensus building (while maintaining Ministerial discretion).Under the IFMP process, the effectiveness of various conservation and management measures is evaluated so that DFO can monitor and adjust the department’s or the activities of resource users(sic) to ensure sustainability of the fishery

In contrast, the JPA, the second of DFO’s two-step process, is described as follows.

Resource users, through their legally constituted and representative organizations, can have greater formal involvement in the management of their specific fishery by working with DFO on specific activities through negotiating a Joint Project Agreement (JPA). Entering into a JPA is voluntary and must be agreed to by both the party and DFO. JPAs generally cover specific activities such as data collection, data analysis, science and/or fishery management activities. In general, these items should be incremental to DFO’s core activities. In practice it is recognized that complete distinction between DFO core activities and those outlined in a JPA is not always possible.

The JPA spells out the contribution that each party (DFO, harvester organization) brings to the project. A JPA can provide greater opportunity for fish harvesters to input and participate in certain decisions affecting the management of a particular fishery with the IFMP framework.

Under the current Fisheries Act, the Minister retains full discretion on resource access issues (eg, licencing, allocations, participants). DFO cannot legally enter into an agreement that would fetter the Minister’s discretion in these areas in any way. Only with new legislation would agreements in areas of resource access be possible.(emphasis in original).

Finally, the Framework and Guidelines describe informal co-management arrangements.

It is recognized that there are a host of arrangements in which resource users aid in the management of their fishery through contributions to stock assessments, enforcement, surveillance and other activities. Many are not formalized into a legal JPA document. In some cases, such arrangements have proved to be a good starting point for further co-management as they allow parties to build the necessary capacity and trust-based relationships.

Signing a formal agreement may not be desirable for all fisheries but JPAs do provide several advantages for both parties over the informal approach. A formal agreement clarifies roles and responsibilities and provides clear documentation of the contributions that each party is making to the management of a fishery. A formal agreement increases the certainty that various activities will be done and thereby increases the stability of the operating environment for all parties.

The Framework and Guidelines document also discusses Fisheries Management Partnering.

In earlier versions of these guidelines, a third level of co-management was identified, so-called Partnering. This advanced form of co-management would involve the signing of legally-binding Fisheries Management Agreements (FMAs) between the department and representative groups of resource users regarding key aspects of fisheries management such as licencing, access and allocations. As the current Fisheries Act does not allow the Minister to enter into legally-binding agreements in these areas, legislative reform is necessary to proceed with FMAs.

An independent panel was appointed by the Minister to study the implication of this concept. The panel’s recommendation was for DFO not to go forward at this stage with legislation for partnering (ie, FMAs). At the advice of the panel, DFO will pursue co-management on the basis of existing legislation through IFMPs, JPAs and other forms of co-management.
 

Appendix D: Co-Management Funding Mechanisms and Activities/Programs

Appendix E: Co-Management Costs

The table on the next page shows average landed values (1997-2000), licence fees, funds raised by Use of Fish and monies paid by industry.

Funds raised from Use of Fish and monies paid directly by licence holders are split amongst payments to contractors, payment to DFO and charters. The split in each fishery is different; there is no common theme amongst fisheries in this regard.

The table includes two summary statistics (both shown with and without licence fees included):

1. ratios of total funds to average landed value in percentage terms and
2. average costs per licence.

Please note the following:

• The $321,000 shown for Rockfish includes monies paid by Schedule II rockfish. This figure is taken from the IFMP.
• The 37 licences shown for Herring Spawn-on-Kelp excludes the nine exempt licences.