... "'"""" .., ; , i ......... ---Salmon Enhancement---.. An Assessment of the Salmon Stock Development Program on Canada's Pacific Coast by Peter H. Pearse FINAL REPORT of the Program Review of the Salmonid Enhancement Program Internal Audit and Evaluation Branch De~artment of Fisheries and Oceans , I . ::; ;:S4~ ::;almon enhancement: an aissessment P42 of the Salmon Stock Development rer 1994 Program on Canada's Pacific coast I 94 c.2 by Peter H. Pearse . ... " ,..,."" ~- ,... I .-, ) , . I I I EXECUTIVE SUMMARY HE Salmonid Enhancement Program was be sufficient to offset the negative net benefits in launched in 1977 with the objective of fish production. T doubling salmon catches on the Pacific coast An ambitious program involving Some of the basic premises on which the construction of hatcheries, artificial spawning Salmonid Enhancement Program was based channels and other enhancement works was have proven to be faulty. One was that salmon expected to generate significant economic production could not be restored through better benefits and the cost was to be recovered from management of wild stocks; improvements in those who catch the fish. managing fishing have since increased catches of wild salmon by more than the increase in Over the last 17 years some $526 million enhanced production. Another was that the has been spent. A substantial enhancement technology of enhancement was proven; it has capability, consisting of more than 300 since been revealed as uncertain and risky. A facilities, is now in place. They contribute about third was an assumption that government would 14,000 metric tonnes, or roughly 13 percent, of take steps to prevent further unnecessary the annual catch of salmon. In addition, the investment in commercial fishing capacity., but Salmonid Enhancement Program has established no new measures were taken. A fourth was an significant programs in education, public assumption that the costs would be recovered information, native development and research from those who catch the fish, but only token related to enhancement efforts were made to do so. Enhanced production has fallen signifi­ The analysis indicates that the economic cantly short of original expectations, mainly outlook for future enhancement is, potentially, for two reasons. One is funding at lower levels much brighter. With the facilities in'place, and than expected. The other is the shift in their capital costs already expended, the priorities, in the 1980s, from cost-efficient prospective benefits exceed the prospective production in large-scale spawning channels costs over the facilities' remaining life. More­ for sockeye and hatcheries for chum salmon over, the economic performance of facilities to costly attempts to restore depressed wild varies widely, and termination of those that fail stocks, especially coho and chinook. to meet minimal standards of cost-efficiency would significantly improve the overall results. The economic achievements have been There appears to be promising opportunities in disappointing as well. The estimated lifetime . additional salmon enhancement and habitat cost of constructing and operating the development projects also. enhancement facilities built under the Salmonid Enhancement Program exceeds the estimated To take advantage of these oPIX>rtunities, benefits by $592 million, indicating a benefit­ major changes are needed. Enhancement must cost ratio of .6 for the program as a whole. The be reconciled with the conservation of wild unquantified benefits of education, research and salmon; in particular, wild stocks must be other non-production activities are not likely to protected from potential damage from enhanced stocks. A much stronger base of scientific support and project assessment must be provided. The planning and operation of enhancement works must be subjected to more rigorous economic tests. And the beneficiaries must take more responsibility for organizing and financing the enhancement effort. These requirements call for a thorough overhaul of the enhancement program. A suggested new approach involves a gradual transfer of responsibilities for enhancement from the Department to an independent, non­ profit corporation, controlled and financed primarily by the beneficiaries in the fishing community. The proposed corporation would raise its revenues from those who catch the fish and manage existing and new enhancement facilities with a view to generating maximum benefits for the fishing interests it represents. It would also be empowered to enter into agreements with local fiShing and other organizations to take over enhancement facilities and develop new ones. These general proposals are intended to focus discussion between government and private interest groups, with a view toward identifying the most promising and acceptable approach for a renewed enhancement program. ii '---I CONTENTS Page Executive Summary........ ... .................... ........... ............ ...... .......... ........ .......... ... ........... .... i Contents ...................................................................................................... 0.G................... iii Pr'eface 0 ..................... , •••••••••••• I ••• I •••••••• e, •• o. t ••• t ••• f •••• 0 tf •••••••••• 0 •••••••• t ••••• f. I ••••• I. II., I I ••• ,.' •••• '.1 I I iv 1. Enhancement of Salmon Production.................... ............... ............ ........ ..................... 1 2. Development of the Enhancement Program ................................................................ 5 3. Gains in Salmon Production from Enhancement .. " ....................... "............................ 19 4. Benefits and Costs of Enhanced Production ................................................................ 26 5. Evaluation and Outlook ............................................................................................. 37 6. Conditions for Future Success .................................... " ............ "................................ 44 7. A Renewed Approach to Enhancement ....................................................................... 54 References .......................................... ............................................................................. 62 Appendix: Economic Evaluation Methodology for the Salmonid Enhancement Program............................................... (Separate document) iii PREFACE N May 1977, the federal Minister of Department also commissioned a study by Fisheries announced an ambitious new ARA Consulting Group Inc. of Halifax, who I program to double the production of conducted interviews with representatives of Pacific salmon. With the cooperation of the fishing interests and others, examined the Province of British Columbia, the plan was to program's economic performance, and published . build hatcheries, fishways, artificial spawning a report in 1993. The Department asked me to channels and other works to boost salmon review all these previous studies, undertake any stocks back up to their Original abundance. further analyses I considered necessary, and provide an independent assessment with advice Over the seventeen years since then, the about the program's future. Salmonid Enhancement Program has grown into one of the biggest of its kind in North Since most of the available data had America. Much has been accomplished; some already been compiled by previous investi­ $526 million has been spent, hundreds of gators, I have focused my effort on its millions of salmon and trout have been raised interpretation, the methods used to assess and released into the ocean, and many have benefits, costs and risks, and the conclUSions returned to be caught by commercial, sports that should be drawn for the guidance of policy­ and native fishers. makers. I have supplemented earlier studies with new assessments of the economic But the Salmonid Enhancement Program performance of enhancement projects and of 'f . has always been controversial. As the program their future outlook. And I have reviewed developed its objectives and funding arrange­ biological and economic problems, and my ments were changed, anxieties grew about the conclUSions, with experts within and outside the effect it was having on natural stocks, and the Department. J economics of producing fish artificially were questioned. Several evaluations of the program This document summarizes my findings were commissioned, but they did not reach and conclusions. I have deliberately left out J consistent conclusions about its success or its much of the complicated detail about the best future direction. program's history, the technologies of rearing fish and problems of fisheries biology and Several months ago the Department of management, because these are well document­ Fisheries and Oceans asked me to review the ed in pt:evious studies (listed in References at Salmonid Enhancement Program. This the end of this document). My aim is to present followed a lengthy evaluation process within as clear and concise a picture as possible of the the Department itself. A framework for program's achievements, what we have learned evaluating the program was prepared in 1988, from experience, what remains uncertain and outlining how it should be done and the ~ta risky, and the extent to which we can proceed needed. A preliminary assessment in 1992 with reasonable confidence. confirmed the need for a thorough review. The following year a detailed description and My investigation, and this report, benefited management review