ARCHIVED - Fisheries and Oceans Canada - Report

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Minister's Message

As Minister of Fisheries and Oceans, I am pleased to present to Parliament and Canadians the 2009-10 Departmental Performance Report for Fisheries and Oceans Canada (DFO).

DFO and the Canadian Coast Guard (CCG), a Special Operating Agency within DFO, use sound management practices and science-based decision-making to provide services and benefits to Canadians through three strategic outcomes: Safe and Accessible Waterways, Sustainable Fisheries and Aquaculture, and Healthy and Productive Aquatic Ecosystems.

In 2009-10, DFO focused on a number of important areas, including the following, to achieve these three outcomes.

Delivering on Projects under the Economic Action Plan

Under Canada's Economic Action Plan, we have been making strategic investments that create jobs and help revitalize communities.

With a two-year, $175 million commitment, we are modernizing DFO's fleet by procuring 68 new small vessels and 30 environmental barges, and performing repair work on 40 aging large vessels.

We are investing $200 million over two years to accelerate the maintenance and repair of fishing harbours across Canada, with work either completed or under way in many coastal areas. In addition, we are investing $17 million to accelerate the construction of a commercial fishing harbour in Pangnirtung, Nunavut, to boost the viability of the Northern fishery.

We are investing $37 million over two years to modernize DFO's laboratories and science facilities and $65 million to help the lobster fishery weather short-term challenges and to thrive in the future.

Improving the Economic Viability of Canada's Fisheries

We are working closely with industry stakeholders to help them obtain the certification needed to expand access to markets at home and abroad. I am pleased to report that in December 2009, DFO opened its first Catch Certification Office to support Canadian exports of fish and seafood products affected by European Union regulatory requirements. I also visited China last year to promote Canadian seal products and seafood to the world's largest consumer of fish and seafood.

Commission of Inquiry into the Decline of Sockeye Salmon in the Fraser River

In November 2009, the Government of Canada took action to address the low returns of sockeye salmon to the Fraser River by establishing the Commission of Inquiry into the Decline of Sockeye Salmon in the Fraser River. DFO recognizes the importance of this iconic species to all sectors of the fishery, the British Columbia economy, and all Canadians, and has been working to fully support the Commission and its efforts.

Improving the Health of the Oceans

The Government of Canada has completed the third year of a five-year multi-departmental commitment to protect sensitive areas, control ocean pollution, and ensure collaborative oceans management.

As we look to the future, we will continue to consult with stakeholders, using science and the public interest as the foundation of our work and our decision-making. The world around us is constantly changing, and DFO is adapting to deliver excellent results for Canadians every step of the way.

The Honourable Gail Shea, P.C, M.P.
Minister of Fisheries and Oceans

Section 1 - Departmental Overview

Raison d'etre

Fisheries and Oceans Canada (DFO) plays the lead role in managing Canada's fisheries and safeguarding its waters, ensuring safe, healthy, and productive waters and aquatic ecosystems for the benefit of present and future generations. The Department's work is built around three strategic outcomes:

Safe and Accessible Waterways

• Providing access to Canadian waterways and ensuring the overall safety and integrity of Canada's marine infrastructure for the benefit of all Canadians;

Sustainable Fisheries and Aquaculture

• Delivering an integrated fisheries and aquaculture program that is credible, science-based, affordable, and effective and contributes to sustainable wealth for Canadians while respecting Aboriginal and treaty rights; and

Healthy and Productive Aquatic Ecosystems

• Ensuring the sustainable development and integrated management of resources in or around Canada's aquatic environment and carrying out critical science and fisheries management activities.

Mandate

DFO is responsible for developing and implementing policies and programs in support of Canada's scientific, ecological, social, and economic interests in oceans and fresh waters.

The Canadian Coast Guard (CCG), a Special Operating Agency within DFO, is responsible for services and programs that contribute to the safety, security, and accessibility of Canada's waterways. DFO supports other government organizations through the provision of a civilian fleet and a broadly distributed shore-based infrastructure.

The Canadian Coast Guard (CCG), a Special Operating Agency within DFO, is responsible for services and programs that contribute to the safety, security, and accessibility of Canada's waterways. DFO supports other government organizations through the provision of a civilian fleet and a broadly distributed shore-based infrastructure.

The Oceans Act entrusts the Minister with leading integrated oceans management and providing coast guard and hydrographic services, while the Fisheries Act gives the Minister responsibility for the management of fisheries, habitat, and aquaculture. The Species at Risk Act gives the Minister responsibilities associated with the management of aquatic species at risk.

Organization

Fisheries and Oceans Canada is a highly decentralized department, with more than eight of every ten employees working outside national headquarters in one of its six regions. National objectives, policies, procedures, and standards for the Department and DFO are established at national headquarters, in Ottawa. Regions are responsible for delivering programs and activities in accordance with national and regional priorities and within national performance parameters.

Information about DFOs regions, Canadian Coast Guard, and DFO's organizational structure is available electronically on DFO's website.

Operating Environment

Canada is a maritime nation, with three oceans bordering its coastline (the world's longest) and lakes and rivers that make up the world's largest freshwater ecosystem. Together, the country's aquatic resources offer countless economic, cultural, social, and environmental benefits to Canadians.

DFO is responsible for developing and implementing policies and programs in support of Canada's scientific, ecological, social, and economic interests in these aquatic resources. In so doing, DFO must strike a balance between environmental stewardship and economic prosperity while recognizing the interests of various stakeholders and complex ecological factors.

Today, both fundamental long-term changes and recent events are creating challenges and opportunities for DFO and its clients/stakeholders.

On the economic front, the recent recession has driven down prices and global demand for fish and seafood. The high Canadian dollar and higher input costs have increased pressure on the sector, and the profits of commercial fishers have declined dramatically. Competition from the fisheries of developing countries is also becoming more intense.

International markets are increasing their demands for proof that fish and seafood were caught in a legal and sustainable manner. In fact, Canadian products risk being shut out of markets if they are unable to meet rising expectations for sustainability, quality, and food safety. Environmental organizations are focusing more and more on the marine environment, and DFO's management practices in this area are undergoing greater scrutiny.

Social changes are further affecting the fishing sector. Significant demographic shifts are occurring in traditional fishing communities, with younger generations turning away from fishing and toward industries not found in coastal communities. This is hollowing out such communities and creating additional challenges for those who remain in the sector.

The changing environment is providing both challenges and opportunities for the management of Canada's aquatic resources. On the one hand, our natural assets are being put at risk by ocean acidification and warming waters; pollution from development, spills, and accidents; and the growing number of aquatic invasive species. On the other hand, the extraction of new natural resources, the development of Aboriginal and commercial fisheries, and the growth of the tourism industry are all increasing our economic potential, especially in the North.

Although managing wild commercial fisheries has been the Department's traditional focus, aquaculture now accounts for one-third of the total value of Canada's marine harvest. Other marine industries are developing, ecotourism and recreational fisheries are growing, and the ocean economy is broadening as ocean technologies advance. The future may bring new economic opportunities to fisheries communities, but it may also bring greater demand for access to ocean resources for offshore oil and gas exploration, renewable offshore energy, and marine transportation activities.

Summary of Financial and Human Resources

Financial Resources for 2009-10 ($ millions):

Planned Spending	Total Authorities	Actual Spending
1,858.9	2,049.0	1,981.2

Human Resources for 2009-10 (Full-time Equivalents (FTEs)):

Planned	Actual	Variance
10,808	11,030	222

Program Activity Architecture

The Government of Canada's Management, Resources and Results Structure (MRRS) is the foundation of a common, government-wide approach to the collection, management, and reporting of financial and non-financial information. DFO's Program Activity Architecture (PAA) is a component of its MRRS. The PAA shows how DFO's programs align with the Department's three strategic outcomes. Each Program Activity within a Strategic Outcome is linked to a single Government of Canada Outcome Area, permitting whole-of-government reporting. The PAA also includes a standalone Program Activity called Internal Services, defined as the activities and resources that support an organization's program needs and other corporate obligations. For more information on DFO's Internal Services, see Internal Services.

Fisheries and Oceans Canada's Program Activity Architecture

Planning Summary by Strategic Outcome¹

Safe and Accessible Waterways:

Performance Indicator	Target	Summary of Performance
Public's confidence of the safety and security of marine travel in Canada	90%	This result was to be derived from a Transport Canada survey of public opinion. However, because of a moratorium on syndicated studies pending centralized negotiations between Public Works and Government Services Canada and private-sector contractors, DFO was not able to evaluate its 2009-10 performance on this expected result.

($ millions)

Program Activity	Alignment to Government of Canada Outcome Area	2008-09	2009-10
		Actual Spending	Main Estimates	Planned Spending	Total Authorities	Actual Spending
Canadian Coast Guard	Safe and secure Canada	709.6	585.0	701.1	734.2	736.1
Small Craft Harbours	Strong economic growth	119.8	92.8	192.8	216.9	221.0
Science for Safe and Accessible Waterways	Innovative and knowledge-based economy	52.0	35.3	35.3	40.5	40.2
Total		881.3	713.1	929.2	991.6	997.4

Note: Because of rounding, figures may not add to the totals shown.

Sustainable Fisheries and Aquaculture:

Performance Indicator	Target	Summary of Performance
Year over year improvement in management and conservation of major stocks to support sustainable fisheries, as evidenced in growth of the sustainability index (baseline 5.4 out of 10)	4%	Sustainability index: 5.4 (data is from 2008-09, as 2009-10 data has not yet been compiled).

($ millions)

Program Activity	Alignment to Government of Canada Outcome Area	2008-09	2009-10
		Actual Spending	Main Estimates	Planned Spending	Total Authorities	Actual Spending
Fisheries and Aquaculture Management	Strong economic growth	409.1	330.4	331.6	366.2	339.6
Science for Sustainable Fisheries and Aquaculture	Innovative and knowledge-based economy	225.6	139.7	139.7	150.2	134.9
Total		634.8	470.1	471.3	516.4	474.5

Note: Because of rounding, figures may not add to the totals shown.

Healthy and Productive Aquatic Ecosystems:

Performance Indicator	Target	Summary of Performance
Number of policies developed and implemented that serve the public interest via the sustainable development of Canada's oceans and freshwater resources	18 Habitat policies 5 Species at Risk policies	18 Habitat policies 5 Species at Risk policies (Species at Risk policy suite) were posted on the Species at Risk Act Public Registry in December 2009 for the purposes of consultation with stakeholders and the public
Number of programs in place that serve the public interest via the sustainable development of Canada's oceans and freshwater resources	8 Habitat programs 3 Oceans programs 1 Species at Risk program	8 Habitat programs 3 Oceans programs 1 Species at Risk program
Number of formal partnership arrangements established that serve the public interest via the management of human activities in and around aquatic ecosystems	18 national-level partnerships on the management of fish habitat 1 Oceans management partnership 4 Species at Risk management partnerships	9 partnerships on management of fish habitat 1 Oceans management partnership 0 Species at Risk management partnerships

($ millions)

Program Activity	Alignment to Government of Canada Outcome Area	2008-09	2009-10
		Actual Spending	Main Estimates	Planned Spending	Total Authorities	Actual Spending
Oceans Management	Clean and healthy environment	21.1	16.4	16.4	17.4	15.8
Habitat Management	Clean and healthy environment	124.2	57.7	57.7	65.0	62.0
Species at Risk Management	Clean and healthy environment	n/a	16.9	16.9	18.6	21.8
Science for Healthy and Productive Aquatic Ecosystems	Innovative and knowledge-based economy	86.2	55.4	55.4	61.4	60.9
Total		231.4	146.4	146.4	162.3	160.6

Note: Because of rounding, figures may not add to the totals shown.

($ millions)

		2008-09	2009-10
		Actual Spending	Main Estimates	Planned Spending	Total Authorities	Actual Spending
Safe and Accessible Waterways		881.3	713.1	929.2	991.6	997.4
Sustainable Fisheries and Aquaculture		634.8	470.1	471.3	516.4	474.5
Healthy and Productive Aquatic Ecosystems		231.4	146.4	146.4	162.3	160.6
Internal Services		n/a2	311.9	311.9	378.8	348.8
Total Departmental Spending		1,747.5	1,641.5	1,858.9	2,049.0	1,981.2

Note: Because of rounding, figures may not add to the totals shown.

Departmental Priorities

DFO focused on a number of operational and management priorities in 2009-10. Descriptions for each of the priorities and the key plans for 2009-10 can be found in the 2009-10 Report on Plans and Priorities. Each priority has been assigned an overall performance rating based on the following:

Performance Ratings

If this percentage of expected performance is achieved	The performance rating is defined as	The performance rating is shown graphically as
More than 100%	Exceeded	✰✰✰
100%	Met All	✔✔✔
80 to 99%	Mostly Met	✔✔—
60 to 79%	Somewhat Met	✔——
Less than 60%	Not Met	———

Contribution of Operational Priorities to Strategic Outcomes

Contribution of Management Priorities to Strategic Outcomes

Integrated Risk Management

In 2009-10, DFO made considerable progress on embedding integrated risk management (IRM) in its business practices and on better addressing key corporate risks. The Corporate Risk Profile was approved for the first time by the Departmental Management Committee (DMC); DMC also approved a series of foundational documents to formalize IRM governance, processes, policies, and organizational arrangements in a manner compatible with central agency guidelines and international standards.

Key Risk	Risk Mitigation Measures	Link to Departmental Priorities
Human Capital DFO may be unable to attract, develop, and retain sufficiently qualified human resources to deliver on its mandate.	DFO will equip managers to fully address human capital risks affecting their delivery of policies and programs in support of DFO's mandate by identifying gaps in the recruitment, development, promotion, and retention of employees and ensuring access to appropriate guidance and tools.	Human Resources Modernization Information Management and Information for Decision-making
Information for Decision-making Sufficient and appropriate information may not be available on a timely basis to support decision-making.	DFO will use an Information Management Strategic Plan to implement an enterprise approach to information management and will improve the management of information across the Department.	Information Management and Information for Decision-making Asset Management
Organizational Adaptability DFO may be unable to effectively adapt to emerging priorities, directions, and environmental conditions.	DFO will monitor and assess strategies developed by sectors to address emerging priorities and directions and continue to bolster its planning activities and regional committee work.	All Departmental Priorities
Internal Alignment Activities, accountabilities, and resources within DFO may not be optimally aligned to meet objectives.	DFO will continue to use a risk-based process that analyzes departmental funding pressures, activities, and accountabilities to better align resources and priorities.	All Departmental Priorities
Physical Infrastructure DFO may be unable to invest in or maintain the infrastructure necessary to achieve its objectives.	DFO will establish senior management accountabilities for asset management and develop a system to provide comprehensive and integrated information on assets to ensure that DFO's physical infrastructure is maintained.	Canadian Coast Guard Rejuvenation Asset Management
Stakeholder Expectations DFO may be unable to manage expectations and maintain the confidence of stakeholder groups, the public, media, and elected officials.	DFO will assess communications and consultation mechanisms, as well as outreach efforts. DFO will assess learning and training strategies to foster more consistent core messages on priorities and strategic directions.	Fisheries Renewal Market Access Information Management and Information for Decision-making International Agenda
Partnering and Collaboration DFO may be unable to create and sustain effective partnerships, or there will be failures on the part of third parties on which DFO relies.	DFO has begun to review and assess all the collaborative arrangements it has with organizations.	Northern Strategy Fisheries Renewal Market Access Information Management and Information for Decision-making Health of the Oceans
Legal and Compliance DFO may be successfully challenged before the courts, resulting in either significant financial liability or negative effects on DFO's legislative or regulatory authorities, and DFO may not be able to ensure public compliance with its legislation and regulations.	DFO will develop and assess a complete, department-wide inventory of key mitigation measures for this risk.	Sustainable Aquaculture

To identify, prioritize, and mitigate risks associated with initiatives under the Economic Action Plan, DFO developed and implemented a Risk Management Framework. This is an important tool for monitoring and reporting progress on mitigation measures to DMC.

Expenditure Profile

Voted and Statutory Items

($ thousands)

Vote/Statutory Item	Vote/Statutory Wording	2007-08 Actual Spending	2008-09 Actual Spending	2009-10
				Main Estimates	Actual Spending
1	Operating expenditures	1,210,815	1,278,302	1,167,689	1,312,645
5	Capital expenditures	211,207	249,382	242,667	414,830
10	Grants and contributions	73,368	94,614	110,637	111,780
(S)	Minister of Fisheries and Oceans Canada salary and motor car allowance	74	77	78	78
(S)	Contributions to employee benefit plans	118,078	122,577	120,446	137,790
(S)	Spending of proceeds from the disposal of surplus Crown assets	3,079	2,590	—	2,478
(S)	Other statutory items	12	4	—	1,637
Total - Fisheries and Oceans Canada		1,616,633	1,747,545	1,641,516	1,981,237

Departmental Spending Trend

Departmental Spending Trend

Financial Analysis

The Department's total actual spending for 2009-10 was $1,981.2 million. Spending generally increased between 2004-05 and 2009-10.

Planned Spending to Total Authorities: From $1,858.9 Million to $2,049.0 Million

Planned spending for 2009-10 was $1,858.9 million, whereas the Total Authorities for the Department are $2,049.0 million, representing a change of $190.1 million. The increase is primarily due to:

• $63.7 million for salary expenditures related to approved collective agreements and other associated benefits;
• $42.7 million in net additional funding for items such as financial support for Quebec and Atlantic lobster harvesters, assessment, management and remediation of Federal Contaminated Sites, the design phase of Canadian Coast Guard mid-shore patrol vessels, policing and security at the 2010 Olympic and Paralympic Winter Games, and support for continuing negotiations of land claims and First Nations' self-government in British Columbia;
• $35.4 million from deferred spending carried forward from 2008-09 for the operating budget carry forward ($26.4 million), and the Canadian Coast Guard special non-lapsing capital carry forward ($9 million);
• $26.1 million for Economic Action Plan initiatives led by other government departments for items such as modernizing federal laboratories, environmental assessments for the Mackenzie Gas Project, and accelerated remediation of federal contaminated sites;
• $19.0 million for statutory adjustments; and
• $3.2 million related to the sale of Crown assets.

Total Authorities to Actual Spending: From $2,049.0 Million to $1,981.2 Million

The difference of $67.8 million is largely explained by:

Funds not spent:

• $45.9 million in operating, capital, and grants and contributions spending that was deferred and carried forward to future years for such initiatives as the Pacific Integrated Commercial Fisheries Initiative, the Atlantic Lobster Sustainability Measures program, the operating budget carry forward, and the Canadian Coast Guard special non-lapsing capital carry forward.
• $7.1 million in lapsing appropriations primarily due to an amount frozen to offset a forecast shortfall in revenue.
• $5.1 million in employee benefit premiums that are charged when funds are transferred from operating expenditures to cover salary costs.
• $1.6 million to refund previous years' revenue.
• $11.0 million in general lapses - that is, funds the Department did not spend. These include items such as $1.4 million in operating and capital funds that are not eligible to be carried forward to future years and lower than expected interest in available grants and contributions funding for the Pacific Integrated Commercial Fisheries Initiative and the Atlantic Lobster Sustainability Measures programs.

Additional funds received:

• $3.0 million released from frozen allotments, in lieu of new appropriations, primarily to fund Canadian Coast Guard security activities at the 2010 Olympic and Paralympic Winter Games.

DFO carried forward $45.9 million of this $67.8 million for spending in future years. Only $21.8 million, approximately 1% of total approved spending authority, remained unspent and was lapsed. This highlights the accuracy of the Department's financial management.

Spending by Strategic Outcome

The Department's total actual spending was $1,981.2 million in 2009-10. Spending associated with the Safe and Accessible Waterways strategic outcome accounted for approximately 50% of all spending. Approximately 54% of total departmental spending was due to two programactivities: the Canadian Coast Guard (37%) and Fisheries Management (17%). Science Program activities associated with the three strategic outcomes accounted for 12% of the Department's total spending.

Operating expenditures made up 73% of DFO's spending in 2009-10.

Capital spending formed the next largest share (21%) of actual spending. Coast Guard spending on vessel infrastructure accounted for approximately 58% of capital spending. Expenditures on Small Craft Harbours made up another 24%, improvements in DFO real property assets for most of the remainder (16%).

 

Grants and contributions, or transfer payments, are monetary payments or transfers of goods, services, or assets to third parties. Transfer payments include grants, contributions, and other transfer payments, including those made to other orders of government, international organizations, and First Nations. Grants and contributions account for approximately 6% of the Department's spending.

DFO uses twelve major (over $500,000 per year) transfer payment programs, as well as a number of smaller programs, to leverage its resources and to achieve program and policy objectives associated with its three strategic outcomes. Of these, six account for almost 85% of the Department's grants and contributions.

Canada's Economic Action Plan

Canada's Economic Action Plan (EAP) allocates close to $12 billion in new infrastructure funding over two years to create jobs across Canada and to ensure that Canada emerges from the economic downturn with a more modern and greener infrastructure. DFO received the following funding in 2009-10 as part of the government's EAP.

($ millions)

EAP Initiative	Summary of Performance	2009-10
		Forecast Spending	Actual Spending	Actual Spending, including Contributions to Employee Benefit Plans
Canadian Coast Guard - Shipbuilding and Repair	All 2009-10 projects completed as planned Vessel life extension work on CCGS Bartlett and CCGS Limnos completed by Spring 2010 30 of the small craft delivered	90.0	81.9	82.1
Small Craft Harbours	240 projects under way 96 small craft harbour projects completed	102.3	112.3*	116.9
Pangnirtung Harbour	Two construction contracts were let and equipment mobilized to the site Phase 2 engineering is ongoing	7.0	4.2
Mackenzie Gas Project	Larger portion of the funding used for salaries Detailed analysis of the recommendations in the joint panel review report (released December 2009) was undertaken	4.2	3.6	3.9
Federal Laboratories	Construction under way at 69 of the 70 sites 27 projects completed	13.6	13.1	13.1
Federal Contaminated Sites Action Plan	728 assessments completed 39 remediations completed	8.2	8.6	8.7
Total		225.3	223.7	224.7

* Small Craft Harbours spent $8 million in unused funding from Canadian Coast Guard and $2.8 million of unused funding from Pangnirtung Harbour in 2009-10. This funding will be returned to Canadian Coast Guard and Pangnirtung Harbour in 2010-11.

Additional information can be found electronically on the Canada's Economic Action Plan website.

Economic Action Plan Spending

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