A question for the FFAW: The FRC, the union-owned dockside monitoring company, operated for years as a not-for-profit organization, but there's no mention of not-for-profit on the new FRC website.
Why is that?
I never did understand how the FRC could be described as not-for-profit anyway, when, over a 10-year period (1999-2009), it paid $5.7 million to the FFAW for "shrimp grading and crab research fees."
That information was revealed in September, and, for months after, I accused the FFAW of skimming profit from the FRC.
The union never did respond, but I can guarantee you this: the questions won't be going away.
That $5.7 million could have been used to reduce dockside monitoring fees charged to harvesters, who have good reason not to trust the FFAW.
Here's the detailed research:
Millions in dockside monitoring fees paid to FFAW for 'shrimp grading and crab research'
An FFAW-controlled company responsible for overseeing the provincewide Dockside Monitoring Program paid the union almost $5.7 million over 10 years (1999-2009) for “shrimp grading and crab research fees,” audited documents reveal.
That’s even though the Fish Harvesters’ Resource Centres (FRC) is a not-for-profit company created in 1993 strictly to verify fish landings.
Further, the bulk of the FRC’s revenue comes from fishermen, who are charged a fee for dockside monitoring based on species and catch (with cod, for example, fishermen pay two cents a pound, plus HST).
The news raises the question whether fishermen — many of whom are already struggling in light of dwindling stocks such as crab and shrimp, as well as escalating fishery fees — have been overcharged for dockside monitoring, which is mandatory as a condition of licensing.
According to the audited financial statements, the FFAW/CAW has an “economic interest” in the FRC. Earle McCurdy was chair of the FRC’s Board of Directors for years, while also serving as FFAW president.
While the FRC was forced to cut salaries and other costs in the late 2000s as the result of a declines in revenues (catches were down), the funds paid to the FFAW averaged $800,000 a year.
“SHRIMP GRADING AND CRAB RESEARCH FEES” PAID TO THE FFAW
2009 — $720,801
2008 — $863,005
2007 — $826,022
2006 — $777,477
2005 — $732,261
2004 — $825,876
“Shrimp grading, research and educational fees” paid to the FFAW
2003 — $151,826
2002 — $171,912
“Shrimp and crab landing fees - FFAW”
2001 — $222,131
2000 — $228,064
1999 — $206,909
According to the audited financial statements, the FRC didn’t pay the FFAW shrimp or crab fees between 1994 and 1998.
In order to receive the Dockside Monitoring Designation, companies must “ensure that there are no actual or perceived conflicts of interest between DMCs and fishing entities, which are being monitored.” But the fact that the FRC is run by a company controlled by the fishermen’s union can be perceived as a conflict in itself.
According to a report to the board of directors, concern was expressed by the FRC in 2009 that a new private dockside monitoring company had been certified by DFO, “and we must prepare for any implications to our operation.”
Of note, the FRC reduced the Dockside Monitoring fee charged in the shrimp fishery to 4/10 of a cent from 1/2 cent in 2006. “This 1/10 of a cent reduction resulted in approximately $315,000 being put back into the hands of shrimp fishers for the two years 2006 and 2007.”
In the case of fishermen who go over their trip limit in the shrimp fishery, the extra shrimp is sold, with funds directed to the FFAW’s “shrimp fund.” Why isn’t money from that fund used for grading?
While most of the FRC’s funds come directly from fishermen, the company has also received grants from the Atlantic Canada Opportunities Agency, the National Research Council, and Service Canada. As well, the FRC has also secured DFO contracts to monitor the offloading of foreign fishing vessels in Newfoundland.
The central complaint is this: The FFAW receives untold millions of dollars a year from various federal departments to administer/oversee various fisheries programs in the province, while, at the same time, the union is expected to hold Ottawa to account on its day-to-day management and overall policy decisions.
The obvious conflict undermines the faith of thousands of fishery workers in — not only their union — but the entire industry.
Normal checks and balances that accompany a union-management dynamic can be compromised when funds change hands between the two, potential negatively impacting the entire fishing industry.
— Conflict of interest charges have also been levelled at the FFAW for its close ties to Offshore Fish Resource Harvesters, a company awarded a snow crab quota in 1996.