is $100 a ton or 35 percent of cost, which- 

 ever is less. Up until April 1959 bounty 

 payments had been made on 19 vessels. These 

 generous provisions could be of substantial 

 aid to an owner of a large-sized wooden 

 vessel. Their significance as a competi- 

 tive advantage viz-a-viz New England is, 

 however, limited. VJooden vessels over 

 fifteen years of age are near the end of 

 their useful life and subsidies merely pro- 

 long this a few years more. Progressive 

 management would dictate replacement rather 

 than reconstruction of such types. 



An important Federal Canadian subsidy 

 to a large segment of the groundfish indus- 

 try consists in rebating about half of the 

 cost of salt used in saltfish production. 

 In the fiscal year 1958 budget, $550,000 was 

 requested for this purpose. §2/ In the past 

 the Fisheries Prices Support Board has also 

 made substantial deficiency payments to 

 saltfish producers and firemen in New- 

 foundland and Quebec. No such subsidy pay- 

 ments have been made on fresh and frozen 

 groundfish, although it would be within the 

 power of the Board to do so should this 

 market become demoralized. There is no 

 present likelihood of such action occur- 

 ring. 



Another Dominion subsidy of particular 

 significance to the saltfish industry is 

 the construction of bait freezing and stor- 

 age facilities and the providing of live 

 bait to fishermen in isolated areas. Total 

 net cost of these two programs in fiscal 

 1956-57 was about $225,000. 



The subsidies paid to saltfish pro- 

 ducers have no readily apparent short-run 

 effect on the fresh and frozen groundfish 

 primary market. Without such subsidies, 

 however, there might well be severe eco- 

 nomic dislocation and privation in isolated 

 ports without facilities for other than 

 saltfish processing. In such a depressed 

 situation, there would be even greater 

 fishing labor surpluses and more downward 

 pressure on labor's return from both salt 

 fish and fresh fish sales. This could re- 

 sult in lower prices for fresh fish and 

 would give processors a greater price 

 leverage in the export market. The mainte- 



nance of a saltfish industry by the use of 

 subsidy helps to insure a continued supply 

 of fishermen, albeit not trawler men. It 

 also represents potential additional fresh 

 fish supplies for the processing Lndustry 

 should rising consumer demand induce 

 processors to establish the expensive 

 collecting stations necessary to obtain 

 supplies from the outports. 



Canadian federal law has made some 

 exemption in its domestic tariff structure 

 which benefit the Canadian trawler owner. 

 Certain items such as cottonseed oil, pea- 

 nut and olive oil, and various fishhooks, 

 lines , and cordage enter duty free . En- 

 gines and engine parts enter at one-half 

 the regular duty rate. It is difficult to 

 weigh the effect of these exemptions in 

 terms of competitive advantage. Much de- 

 pends on whether the vessel is of American 

 or European origin. When a Canadian 

 trawler owner has to buy parts from a 

 united States or a Canadian concern, he 

 probably has to pay more than his New Eng- 

 land coiinterpart because of transportation 

 and/or tariff costs . When he obtains 

 parts from Europe, particularly England, 

 he can buy them at substantially lower unit 

 costs. 



The so-called Halifax award, which 

 annually amounts to $160, 000, provides a 

 small direct subsidy to deep-sea fisher- 

 men and vessel oi^mers. These bounties 

 have been paid since the l880*s and repre- 

 sent interest on an indemnity paid to 

 Canada by the United States as the excess 

 value of the Canadian inshore fisheries 

 over those of the United States and as 

 compensation for the loss of the United 

 States market at that time by Canada. The 

 actual awards per fishermen are about $10j 

 each vessel owner gets $1 per registered 

 ton up to $80, so that the largest owner 

 with a 23 vessel fleet received about 

 $830. 66/ 



In addition to the direct subsidies 

 there are many Jtederal and Provincial 

 services to the Canadian fishing industry, 

 the results of which cannot be measured in 

 terms of vessel operating costs but which 

 in aggregate are significant. Foremost is 



65/ Ibid., p. 170. 



"^Z Hearings before the Subcommittee on Fisheries and Wildlife Conservation, April 

 and June, 1959. op. cit. p. 180. 



31. 



