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Mike Kelloway Member of Parliament, Cape Breton-Canso

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Mike Kelloway Member of Parliament, Cape Breton-Canso Mike Kelloway Member of Parliament, Cape Breton-Canso April 27th, 2020 The Hon. Bill Morneau, Minister of Finance The Hon. Bernadette Jordan, Minister of Fisheries & Oceans, and the Canadian Coast Guard The Hon. Carla Qualtrough, Minister of Employment, Workforce Development & Disability Inclusion The Hon. Mary Ng, Minister of Small Business & Export Development House of Commons Ottawa, Ontario, Canada K1A 0A6 Dear Ministers, Re: Support for the Fishery in Cape Breton and North Eastern Nova Scotia I write to you today to express the concerns of my constituents who make up the staple economic driver in our local economy – the fishery. Below you will find feedback that I’ve heard from regular industry engagement such as constituent and stakeholder calls, as well as recommendations on how to further support the health, safety, and economic viability of the sector. Everyone understands that this season will be unlike any other. We agree that the Health & Safety of our men and women on the ships, docks and plants is of the utmost priority. Second to this is this short- and long-term implications on the products marketability. The impact COVID-19 will have on the price of lobster, and subsequently the livelihood of harvesters and plant workers/owners is inevitable. While I applaud our recently announced modifications to the Canada Emergency Response Benefit to include seasonal workers, such as those in the sector, who, for health & safety or economic factors cannot work, will have a guaranteed source of income for at least 16 weeks – the full nature of seasonal workers must be considered in our longer-term response. Parallel to this, we must provide assurances to workers in this situation. I am referring simply to the fact that the CERB is not insurable and will not assist with the ‘off-season’ for seasonal workers. They would typically rely on Employment Insurance to get them from season to season. Confirmation in writing that we will close this loop is needed now so people can make informed decisions on their health, safety and livelihood. Many I’ve spoken to feel the government is “forcing” them to go to work and risk exposing themselves or loved ones to COVID-19. While the opening of the season does not force anyone to go fish per se, lack of certainty on income support during the off season leaves them with little choice. Our approach must give workers the privilege of choice. Recommendation #1: In collaboration with Minister Morneau and Minister Qualtrough, create an option for Employment Insurance extension for those workers who rightfully choose not to fish because of health, safety or economic reasons. This extension must have added reasonable and fair flexibilities to allow harvesters and plant workers the ability to return to work or stop working as the public health situation changes. Furthermore, written assurance/notice that a measure that, in principle, reflects the spirit of this recommendation shall be introduced. When the Canada Emergency Business Account and the Canada Emergency Wage Subsidy were both announced, we were relieved thinking that these would both assist harvesters and buyers in continuing operations in the face of economic downfall. Unfortunately, the sectoral lens was not adequately applied in these measures. While some in the sector stand to benefit from these measures, many will not. Some captains and buyers are paying workers now, incurring expenses as they do every off-season, in preparation of the season ahead; operating on the assumption that they will recoup these expenses with expected revenue during the season. Unfortunately, this year, that may very well not be the case. Furthermore, the current eligible periods for the CEWS only bring us to June 6th. This is, at best, only three weeks into the normal season. Recommendation #2: Allow the CEWS to be retroactive to April 1st for harvesters and buyers who have incurred employee expenses while not receiving any revenue leading up to the opening of the season. In doing so, the revenue comparison dates must be established with the understanding of the revenue-generating timelines and nature of the fishery. Recommendation #3: Extend the eligible periods for the CEWS to the end of the summer, at least, recognizing that the fishery, small businesses and many other seasonal industries will be impacted by this pandemic well past the June 6th period. For many, a $40,000 guaranteed loan with up to 25% of it forgivable would help weather this storm. Unfortunately, the transactional nature and relationship between harvesters and buyers identifies a crucial gap in the CEBA. The way in which many are actually paid on their catches is quite unique compared to many sectors. As an example direct from industry: “some harvesters sell to a buyer and the money from the sales go into an account they keep with the buyer, the buyer then cuts a pay cheque for the harvester's crew using money from that account. So, it is the harvester paying for the wages of their crew but the physical cheque comes from the buyer. Because of this, it looks as though the harvester has no payroll and therefore cannot use the wage subsidy or CEBA program to help him get through this difficult season”. Recommendation #4: Working with the Minister of Finance, Small Business, and National Revenue, create a mechanism in the Wage Subsidy application portal that is uniquely programmed to identify and allow for these specific payroll arrangements. Further, in working with the Financial Institutions that are administering these loans, impress upon them to consider these arrangements as legitimate and eligible under the CEBA. An area of exclusion that exists within the CEBA program with respect to the fishery, is the type of accounts that many harvesters have established to pay their crew. On the advice of their accountants, many harvesters that are a legitimate business and fully registered, pay their help through a personal account, as opposed to a business chequing account. Recommendation #5: Allow harvesters within the sector, who are legitimately registered and have a business number, to access the Canada Emergency Business Account with a personal chequing account as opposed to an existing business chequing account. We’ve heard from many harvesters and buyers alike the need for personal protective equipment – not just in plants, but for workers on the docks and vessels, as well. While the recently announced measures for processors are very much welcomed, financial support for harvesters, deck hands and workers on the docks to support health & safety are needed quickly. Recommendation #6: Convert, Modify and Extend the Atlantic Fisheries Fund to provide grants that will help harvesters purchase adequate PPE. In doing so, an expedited application process must be established. To help identify need, the Department of Fisheries and Oceans can work with local port authorities or industry associations. Many were very pleased to see that our government announced $62.5 million on Saturday, April 25th, for the sector to help increase storage capacity at plants, and purchase PPE for processing workers. Some, however, feel this comes too late and does not address the risk that harvesters are exposing themselves to. Recommendation #7: Eliminate unnecessary red-tape that would delay the flow of funds from the Canadian Seafood Stabilization Fund on the outset as time is not a luxury in the sector. Further, expand the program to equally include harvesters. Finally, decisions to delay and extend the lobster season have an enormous impact on the industry, market price and importantly, trust from the sector. Last week, the decision to delay the Lobster season in the Gulf of St. Lawrence has sparked wicked concern by many in the area. It has also created further market concerns in other LFAs of my riding. While there is no one-size fits all approach to the sector, when it comes to season delays and other decisions that so greatly impact the livelihood of many, a consistent and open approach must be taken. We are hearing many opposing views on the above-mentioned decision. Many welcomed the date change, yet many others are strongly opposed. Recommendation #9: Should a season be delayed in one area, and be perceivably cut short, we must ensure that we extend the season on the back end; either immediately or later in the year provided local science is on-side. We have to simultaneously communicate this with the sector to eliminate panic and uncertainty. Canadians are reasonable. When they feel there is adequate communication and involvement in decisions that impact them, we can work together to find solutions. We must stay closely connected to this sector. Our approach must be balanced to support those who wish to fish safely, and those who must stay home for health, safety or economic reasons. Ministers, I applaud you on your efforts to-date. However, I implore you to strongly consider the impact our decisions have on such a vital sector to the Canadian economy. I am available to speak with each, any and all of you at any time to discuss these recommendations. Sincerely, Mike Kelloway Cape Breton - Canso .
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