Mr. Bryce:

Can the minister tell us how much money has been spent in support of Manitoba fish prices up to the present time?

Mr. Sinclair:

As far as this year's support for prairie fish is concerned, the payments have not been completed. The total cost is estimated to be about $250,000.

Mr. Kirk (Digby-Yarmouth):

This is the item covering the agreement between the Nova Scotia government and the federal government as to loans to fishermen who suffered so severely in the storms of a year or more ago. During my travels through the counties of southwestern Nova Scotia, in the latter part of the fall, a great many of the fishermen who had obtained those loans spoke to me of the benefit they had received and of their appreciation. Since so many of them had requested that these loans be granted, and since the two governments had worked together and cooperated in the plan, several of them went so far as to suggest that I should do what I am doing now, namely extend their thanks personally to the minister and his department.

Mr. Browne (St. John's West):

Is the minister going to give us a statement about that matter?

Mr. Sinclair:

On the next item.

Mr. Sinclair:

This is the item which will permit the inauguration of this scheme of fishermen's insurance on boats and on one type of gear, which I referred to yesterday. In the house at various times comparisons have been made-not in a carping manner, but nevertheless there have been comparisons -between the facilities available to the farmers of Canada as compared with those available to the other primary producer of food, the fishermen. There is no doubt about it that fishing is an even more hazardous occupation than is farming. Because of the very nature of the industry, it has been more difficult for a fisherman to obtain definite aid in the form of either credits or grants or insurance.

That is especially true as far as the small fishermen's boats are concerned. The large boats-the seiners on the west coast and the trawlers and draggers on the east coast- are assessed and registered and can be insured by private insurance companies or by cooperative insurance companies at a reasonable rate; I think it is about 4| per cent. But unfortunately the great bulk of the fishing fleet, which is owned by the fishermen themselves or groups of fishermen, consists of boats which are smaller than that.

The private insurance companies have found it impossible to offer insurance to those classes of boats, for an obvious reason: The cost of administration would be so great in assessing the boat, and in having field men go out after storms, wrecks or fires in order to assess the damage. The rates quoted on small boats such as those I have mentioned would run from 12 to 20 per cent. Obviously no fisherman with a small boat can afford to pay such premium rates. Because of this situation the department this year made an investigation, as a consequence of the demand from every corner of the house from members representing fishing ridings that we should do something since the private insurance companies were unable to enter the field, and that the government had the responsibility to begin some system of vessel insurance.

The problem is limited first of all obviously by the value of the boats. We find that boats of a value of $7,500 could quite easily get commercial insurance. So the first step was to have our committee from both our

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department and the insurance branch of the Department of Finance visit the coast and assess the storm damage. The hon. member for St. John's East some two or three weeks ago asked a question about the committee's work down in St. John's. They worked out what they thought would be an equitable rate for such insurance. We are now ready to go ahead with a provisional plan of such insurance.

That is one reason we are doing it by an item in the estimates rather than by legislation. It is a new field. It is a field in which we are going to have to gather a lot of experience. Hence for the first year or two we are starting with what might be called a rock-bottom plan in order to get the administration rolling and to gain with respect to such an insurance plan the experience which can be gained only by. having a plan in action.

The first approach was this. We quickly found that we could conquer this matter of costly administration because as a federal Department of Fisheries we have fishery inspectors, officers of our department, in every fishing area which is administered by the federal government. These men, with their regular duties, could easily combine the work of assessing boats and assessing the loss due to storm or other damage. That was a great step forward.

We then thought of confining the scheme for the first years to the coastal provinces where we have control of the fisheries, namely British Columbia, the three maritime provinces and Newfoundland. But various Quebec members-including the hon. member for Iles-de-la-Madeleine and also the hon. member for Gaspe in particular-protested strongly that this would be unfair on much the same grounds as those just mentioned by the hon. member for Selkirk, that the Quebec fishermen who were fishing in the gulf of St. Lawrence would feel that they were not getting the protection which has been afforded to other Canadians through the federal government. So we have now decided to have the scheme cover the five Atlantic provinces and British Columbia.

We propose to offer to the fisherman, by July 1 of this year, or as soon as the administrative details can be worked out, the opportunity to insure his boat and its fixed equip-ment-that is the engine-up to a maximum value of $7,500 for a premium of one per cent of the appraised value. In cases of total loss, there will be an indemnity of 60 per cent of the appraised value. In cases of serious damage-damage of over 30 per cent of the appraised value-there will be an indemnity of 85 per cent of the amount by which the

repair bills are in excess of the 30 per cent minimum. We are having to include in this scheme the same deductible amount, to cover minor damage, as is common with automobile insurance.

To give an example, on a $1,000 boat- which is the common boat along parts of the Newfoundland coast and the maritime coast- the premium will be $10 a year. If this boat is lost or, if in the case of damage the repairs would cost more than the appraised value, the fisherman will receive 60 per cent or $600. In the case of partial damage, the fisherman himself must pay the first $300, which is deductible. In the case of damage amounting to say, $800, the fisherman would pay $375 and the indemnity fund would pay $425.

In addition to loss or damage to their boats, there is another factor of loss, and it is a significant factor. I refer to the loss of gear, traps and pots which are put out to sea and which can be lost by storm. Here again no commercial insurance is available. This is a much more difficult problem than that of boats, because of the expendable nature of much of this fishing gear and the obvious difficulties of trying to administer any form of insurance of this gear. We thought, however, that we should make a start on one type of gear in order to gain the experience which we will have to have before we can expand this scheme more widely; and we chose lobster pots as being the type of gear on which we should start this year. There are over 2 million lobster pots in operation in the Atlantic provinces. They are fairly costly, with the cost ranging from $3 to $7 or $8 a pot.

The losses through storms in recent years have been quite severe; the previous item referred to by the hon. member for Digby-Yarmouth, for example, the item of $80,000 being our share of loans for losses of lobster pots in Nova Scotia in storms a couple of years ago. To make a start on gear insurance we propose to offer to the lobster fishermen, commencing with the opening of the fall season on August 10, in the Northumberland strait area the opportunity of securing partial coverage for lobster traps through the payment of a premium of $7.50 per one hundred traps for the legal fishing season. The premium will be $15 each for two seasons or a single six months' season. Some areas have only a single two months' season. There the premium rate will be $7.50 per hundred traps. In the area where they have two two-months' seasons or a six months' season the premium will be $15 per one hundred traps.

The normal annual wear and tear of course is a very difficult point when it comes to

insuring gear which is expended. Our committee examined the records and talked to the fishermen concerned, and it was generally agreed that there was a 25 per cent loss on lobster traps through wear and tear in each year. That would be the normal loss; and in order to take care of this normal annual wear and tear amounting to about 25 per cent of the traps used, the fishermen will have to take responsibility for the first 25 per cent of the traps which must be replaced in any given season, and it is on the abnormal loss that there will be an indemnity of $1.50 for each trap lost in excess of 25 per cent. For example, a fisherman with 200 traps will pay a premium of $15 for the regular two months' season, and he will receive $1.50 for each trap lost in excess of 50, which would be his normal wear and tear on 200 traps for a short season.

We would like to provide protection to fishermen using other types of gear, such as herring weirs, mackerel and salmon nets, cod traps, crab traps and so forth, but we feel that we must first gain experience in this field of gear insurance on the lobster traps. Our fisheries officers over this winter will be gathering data on the expendability of other types of gear so that perhaps next year we shall be in a position to extend this gear insurance to cover things other than lobster traps.

The other point of concern was the matter of credit for a fisherman who has lost his boat. A fisherman with a $1,000 boat, if it were lost, gets $600 back in insurance. He still has the problem of finding money to replace his $1,000 boat; he has to find another $400. In the four years I was with the Department of Finance I was especially impressed with the Farm Improvement Loans Act, one of the best acts on the statute books of this country, which has done so much for the farmer, in making credit available to him through the banks and has done so much for the farm implement industry in this country through the very greatly increased volume of sales-and it has not been a bad thing for the banks, either.

The banks have been unable up to now to extend such credit facilities to fishing boats, when the entire boat could be lost in a storm, and especially when it was so difficult to obtain insurance for the small boats. The large company boats and the boats operating as fishing fleets have been able to get bank credit, but the smaller fisherman has had to rely for credit on the local merchant or perhaps the processor to whom he sold his fish.

This committee made quite a study of the need for credit of fishermen in those areas,

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and in contacts with the banking officials there was the feeling that if this insurance scheme does work out there will be an opportunity to begin a fishermen's loan improvement act somewhat similar to the Farm Improvement Loans Act, because the banks will then have some security for the boats that may be lost at sea. Therefore for this year we are not going to try to go into the credit field, but we shall see how this insurance scheme works out. If it works as well as we hope it will, we shall be in a position then to suggest some form of fishermen's credit parallel to the very excellent credit now available to the farmers of the country through the Farm Improvement Loans Act.

Mr. Browne (Si. John's West):

I should like to make a few observations. First of all I should like to congratulate those responsible for designing such a scheme. I think I followed all the information given, and it seems to me to be a very good effort for the first year. As experience grows they can extend the coverage. It seems to be very ingenious and those responsible deserve congratulation.

I am very glad also to hear that the minister has been impressed with the arguments that have been advanced on the desirability of giving fishermen advantages similar to those enjoyed by farmers under the Farm Improvement Loans Act. The beginning which he is making now I feel sure is the beginning of a scheme that will be of great benefit to fishermen all over Canada.

Mr. Bryce:

Will this extend to inland fishermen?

Mr. Sinclair:

It will not extend to the prairie fishermen for the first year. We did extend it to the Quebec fishermen because they are fishing in the gulf of St. Lawrence in the areas which are also fished by the Newfoundland fishermen, by the fishermen of Prince Edward Island, the north shore of New Brunswick and of Nova Scotia. Therefore they are in an adjacent area where we have our own fishery officers. We may have to hire one or two other officers in Quebec to cover their fishermen in the gulf of St. Lawrence. We have not such officers operating in the prairie regions, and so unfortunately we cannot extend it to the prairie fishermen this year; but I would hope that very shortly we shall be able to extend it there, too.

Mr. McLure:

I should like to say a word on behalf of the fishermen of my constituency. I can say to the minister and to the officers of his department that this scheme will give to our fishermen some protection similar to that which farmers and other are getting. Representations have been made on this from

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time to time. While we cannot expect every detail of this scheme to be worked out to the entire satisfaction of all at this time, I do believe that the scheme which is outlined by the minister will be a real start on something that will be of great interest to the small liner and to the larger fishermen as well.

As I said at the beginning, I wish to congratulate the minister and his officers for putting this scheme on trial, and I am sure that hon. members who are interested in the fisheries of their constituencies will give every support and co-operation to the minister in working out the details.

Mr. Gillis:

I want to say amen to what has been said by the hon. member for Queens. This measure is indicative of the progressive thinking of the department. It is a long step in the right direction of government insurance particularly, which will be cheaper, will give better coverage and will be better administered than if the minister had got it from Lloyd's or from someone else. It is a very good move and long overdue.

Mr. Knowles:

One question; is it intended- if this insurance plan works out, as I am sure it will-to put it in statutory form at an early date?

Mr. Sinclair:

When I made my earlier remarks I was looking at the hon. member. I take it he did not see me. The committee has been instructed to consider and prepare, in the light of experience, the appropriate legislation. We can only operate a scheme like this on a provisional basis, and then we can take other action once we have gained experience after two or three years of operation. But for this year at least there will have to be an item in the estimates.

Mr. Knowles:

I hoped you had that in mind when you were looking at me.

Mr. Sinclair:

The hon. member has never before honoured us with participation in the discussion of the estimates of the Department of Fisheries and we are glad to have him with us, if only on a constitutional matter.

As far as this government insurance scheme is concerned, I may say that the private marine insurance companies are happy to see us enter this field which they have been unable to cover. Anything which improves the credit standing of these people is an aid to the whole industry.

Mr. Stuart (Charlotte):

I agree wholeheartedly with what the minister has said with regard to the difficulty of devising a plan of insurance that will work in all branches of

(Mr. McLure.]

the industry. It will take a lot of research, but I am pleased that a start has been made. As the minister has mentioned, there are sardine weirs and other structures that cost thousands of dollars. Some of these are in exposed places where the damage each year is much greater than it is in others. The same would apply to lobster gear. In some places the losses are much greater than in others.

It is a big problem. I realize fully that a lot of study must be given to this matter, and that it will take time before a plan is worked out which will protect those who want to be protected. It is most encouraging to the fishermen to realize that boats up to a value of $7,500 can be insured. In the past the difficulty has been, particularly with boats operated by gasoline engines, that the rates quoted by private marine insurance companies were simply prohibitive and it was impossible for these men to insure. This is a plan which I am sure will be endorsed by every fisherman on both the Atlantic and Pacific coasts, and I congratulate the minister and his officials upon bringing it forward at this session of parliament.

Mr. Higgins:

Mr. Chairman, I want merely to add my congratulations to the minister, and to ask him if there is any change in the deal for unemployment insurance for fishermen.