The Waves of Change: Council Fulfills Needs of Industry

Jan 11, 2012

By Melanie Franner

With the amalgamation of the British Columbia Tow Boat Owners Association and the Tow Boat Industrial Relations Association, the Council of Marine Carriers (CMC) came into existence in 1973. Since then, the organization has evolved into becoming the “voice” of the Canadian tugboat industry. It may no longer negotiate with unions on behalf of its members (this service was recently eliminated from its list of responsibilities), but the CMC remains proudly committed to the ongoing safety and regulatory workings of its industry.

“We’re the watchdog when it comes to industry regulations,” states Captain Phillip J. Nelson, president, CMC. “We attend meetings with various regulatory bodies and advocate for appropriate policies, regulations and procedures.”

At The Helm

Captain Phillip J. Nelson, president of the Council of Marine Carriers

Nelson brings many years of experience to his role at the CMC. He began his career as a seafarer on British tankers and bulk carriers trading worldwide before ending up on the west coast of Canada and joining Transport Canada as an inspector. He worked at the government agency for the next 16 years in various positions, ending up as the director of Marine Safety, Ontario Region. It was while here that he was approached by the CMC to replace the CMC’s original president Peter Woodward. He accepted the position in 2003.

“The tugboat industry in western Canada is really the primary domestic marine industry in western Canada,” explains Nelson, who has taken to his role with the CMC as a duck does to water. “The vast majority of our domestic shipping is performed on the coast by towboat and barge. In other parts of Canada, the domestic shipping tends to use more conventional vessels.”

Nelson estimates that the Council of Marine Carriers represents about 60 per cent of the country’s total tugboat industry – and carries about 75 per cent of the business on the coast.

A Growing Industry

According to Nelson, one of the biggest challenges currently facing the western Canadian tugboat industry is the economy.

“The 2008 recession hit this industry hard,” he explains. “I estimate that the industry dropped by about 30 per cent at the time. Since then, about half of it has come back.”

Nelson bases his estimate on his members, whose annual membership fees are determined by their seagoing payrolls.

“On the positive side, we can see things slowing improving,” he adds. “We’re starting to see some of our members building or purchasing new vessels and the introduction of new companies on the coast.”

Another issue, also tied into the economic downturn, is the loss of forestry work.

“The single, biggest customer of our tugboats has traditionally been the forest industry,” states Nelson. “Log towing has always been big business out here on the west coast.”

Since the recession, some of this log-towing business has been lost to smaller, non-union companies.

“Some of our members are now out of the log-towing business altogether.”

Despite this, Nelson remains optimistic about the future of the Canadian tugboat industry.

“I think the tugboat industry is an important one, especially here in the west coast,” he states. “Our work is vital to the shipment of goods here. We’re an essential cog in the wheel.”

Safety First and Foremost

The main rational behind the formation of the CMC was to address industry safety concerns. Back in the ‘70s, says Nelson, there were several tragic accidents involving tugboats. As a result, most people realized that there was a great need for reform and safety culture in the industry. The CMC was created to help address this concern, as was the bevy of new regulations that came onboard shortly thereafter.

“The regulations that came into being in the ‘70s have certainly resulted in a safer industry today,” states Nelson. “That, and the co-operation between our members and the unions to improve safety conditions.”

One way that the CMC continues to focus on safety – and the concerns of its members – can be exemplified in its development of a pilot project with Transport Canada. The pilot resulted in the “Domestic Safety Management” (DSM) system, which included a computer software system. This then evolved into the “Canadian Alternative Compliance Program” and has since become the “Small Vessel Compliance Program”.

“Essentially, DSM allows the tugboat owner to spread out the required periodic inspection of items over a period of time,” explains Nelson, who cites the example of an operator taking advantage of an unscheduled dry dock spell to have an inspection done on a boat’s propeller shaft. “If the boat has to go into dry dock to fix something, then it becomes more convenient to have the shaft pulled out and an inspection arranged at that time rather than to have it done on an inspection anniversary date when the boat may be busy generating revenue.”

Current regulation requires the tugboats to be inspected on a “periodic basis” by Transport Canada, which usually means once every four years. Compliance can languish during the time in between scheduled inspections. The introduction of the DSM program allows tugboat operators to better stay on top of their regulatory requirements.

“The new software program does more than offer continuous monitoring of regulatory requirements,” continues Nelson. “We have also incorporated regular maintenance requirements into the program so, for example, it will include the engine manufacturer’s scheduled maintenance work. Combining the Safety Management System and the planned maintenance system results in an elegant overall quality assurance program. This type of program gives more voice to the ship crews on how the vessels are maintained and operated. It places the responsibility squarely on the shoulders of the owners to make sure this takes place.”

Still being tweaked (even though the official pilot project finished in March), all the companies that participated in the pilot are still maintaining their Safety Management approach. The Small Vessel Compliance Program is expected to become law sometime within the next couple of years, once regulations are finalized. Under the new Safety Management System (SMS) regulations, all commercial vessels across the country will be required to operate under an appropriate SMS regime. This is a direct consequence of the CMC company participation in the DSM pilot project.

Nelson goes on to cite examples of where some of the companies testing the program have been awarded lower insurance rates as a result, as well as some benefits from the Workers’ Compensation program.

“We believe that the Safety Management System approach will benefit the whole marine industry in Canada,” adds Nelson.

A Strong Presence

The western Canadian tugboat industry is estimated to employ about 1,500 seafarers, with several hundred more people to support them. The CMC currently has about 42 full and affiliate members (which respectively include those who own or operate a vessel and have a seagoing payroll, as well as those with an interest in marine issues). It’s an industry that has changed over time and an organization that has evolved to better meet those changes.

“I think we will always have a role as the ‘voice box’ of the industry,” says Nelson. “I think there will always be a need for an organization, such as the council, to represent the industry at all levels of government – provincial and federal – in Canada and the United States. The tugboat industry on the west coast, in particular, represents the main method of moving goods within the coasting trade. I don’t see that changing any time in the near future.”

That being said, Nelson is quick to add that the CMC’s membership numbers are on the rise. He also points out that the CMC maintains governmental links in North America and abroad, and works closely with like organizations in the U.S. and Canada – all in an effort to better meet the needs of the Canadian tugboat industry.

“I think that because we are able to provide an educated and reasonable voice to the many issues that face this industry, we will continue to have a strong future ahead of us,” concludes Nelson