14.03.12: NUTFA Update
NUTFA has been deeply involved in discussions with Defra, the PO's and the NFFO with regard to quota allocation issues for a considerable time as the under ten representative body on the Minister's Industry Working Group.
After many months of debate and argument, the Minister decided upon a small reallocation and realignment of species from the PO sector to the under tens.
This approach was based very clearly and very conservatively [too much so in our view] specifically on those stocks that were obviously surplus to the PO requirements year on year.
The amounts to be reallocated did not even take into account the quantity of quota that had been leased to under tens by the PO's as the government decided, probablyunder pressure from the PO's, that quota that had been leased was deemed to be "used" and therefore not available for realignment.
We have constantly disputed this decision as it would seem entirely logical to us that if one sector has a significant surplus of quota over and above their needs that they are able to rent it out to fishermen in dire need of it then it is fundamentally under utilised and should have been included in that definition, thereby making a proportion of it available for reallocation or realignment.
The decision not to consider it in this way merely provides a government approved conduit for PO's to continue to charge under ten fishers for the privilege of trying to make a living and using a publicly owned resource with which to do so.
In the same way, Defra have constantly refused to follow their own Rules of Quota Management that permits them to reallocate on an in year basis only, quota from one sector that has an excess over and above their operational requirements, to those who are in need of it.
Their excuses for not doing so range, amongst other things, from the apparent threat that it may encourage the race to fish (laughable in light of the current situation for many under tens), might skew the market through producing a surplus of fish on the market (see comment above), encourage a race to fish through PO members attempting to catch all their allowance before its reallocated and importantly, because “PO’s have an obligation to provide their members with the best possible fishing opportunities and financial returns from the quota allocated to them”. [my underlining].
And there’s the rub.
Whilst it is in our view only right of course for the over ten sector to have an equitable share to meet their needs from this public resource, being permitted to use their excess to hold another sector that is in dire need of additional access to this resource to ransom is fundamentally iniquitous.
You will be aware that some have always tried to characterise our aspirations on behalf of the under ten metre fleet as attempting to 'rob Peter to pay Paul' and they have now accused Nutfa of misinforming the Minister with regard to the quota needs of the under tens. [It would seem on that basis that they have not bothered to look even as far as the ports in your area for evidence that clearly contradicts that view].
Now apart from the argument that one can only rob Peter in the event that Peter actually owns the quota in the first place, and the Minister has clearly stated that fish quota is owned by Government and not therefore by definition, by private companies and individuals, there are a number of questions that need answering with respect to the holding and use of quota generally.
Apart from the amount of quota that working fishermen in the over ten sector need and utilise, there are two other segments of their part of the ‘quota pie’ worthy of consideration.
Firstly, there is the amount of quota that is, for want of a better expression, the icing on the cake and secondly, a further quantity, held by both fishers and non fishers that is clearly surplus to their individual requirements because it is available to lease to other users, specifically including the under tens.
Whilst we can argue about the icing part and how one should attempt to balance the difference between needs and wants, the latter segment of quota referred to is certainly where consideration should be given to a fairer distribution based on something other than a form of historic rights or who has the deepest pockets.
The suggested reconsideration is also on the basis that this element is currently being used as an economic weapon in an attempt to subdue both Nutfa and Government efforts to consider the aforementioned balance.
It is also the case that the PO’s curtailed any gifts or swaps to the under tens as soon as the Minister announced his intentions to even consider a reallocation. This action also underlines the need to get away from the current situation whereby the under ten sector is beholden on the mood of a number of private companies as to whether they can survive or not.
The cost of leasing quota follows an inevitably upward trend and you will have seen from reports in Fishing News that it is a problem for both under and over ten operators. You will recall the front page of FN last year with a picture of a Grimsby based pair team having to discard the best part of a 1000 box haul of Cod on the basis that it was not worth their while to pay to lease in quota to cover the catch. At the same time, a number of larger Scottish vessels were being put out of business through being unable to afford to lease quota to maintain their businesses.
Although you would struggle to make up such situations, it begs the question of who actually sets the price of the quota?
The PO’s put themselves forward as caring for their membership and of course it is not that the quota wasn’t available to the aforementioned pair team. UK PLC had sufficient, or at least someone had sufficient quota to cover the catch, but only at a price, and in that instance, and no doubt many more that we don’t hear about, too high a price to make economic sense, hence the discarding.
I don’t need to remind you of course that when Government first mooted the idea some years ago of allowing under tens to lease quota “as a temporary measure to help the fleet in the short term”, NUTFA did highlight the potential threat in the long term of so doing.
Prior to leasing, the under tens benefitted from both gifts and swaps from the over ten sector as a matter of course. Whilst we have never considered this a viable long term method of supplementing the meager resources in the under tens, these benefits were gratefully received. At the same time, NUTFA recognized the desire of some under tens to lease quota to meet their individual financial requirements.
As predicted, we now have a situation where gifts and swaps have evaporated, leasing costs increase year on year, fishers are having to fish harder and make a reduced profit to pay the quota rent and on average, something of the order of 50% of leased quota is not fished due to weather and other constraints for smaller vessels.
Irrespective of our position as the representative body for the under ten fleet, we consider that this situation is neither tenable nor equitable and we can only hope that the Minister recognises that there should be an independent root and branch review, linked to an equal consideration of how to achieve a sensible balance of UK fishing capacity between the sectors within the available fishing opportunities.
It will also be important for this review to be undertaken before the proposals for Transferable Fishing Concessions in the CFP Reform Paper possibly come to fruition and finally cement this public resource as nothing more than a private commodity [although we are not far from this now in the UK]. I have little doubt that there are some out there who are hoping that the debate is delayed sufficiently for this to occur.
We sympathise greatly with Richard Benyon who has been put into an invidious position by the historic mismanagement of the quota issue in the UK. He has said on many occasions that if he was starting from somewhere in this regard, it wouldn’t be from here. It would seem sensible therefore for the whole quota allocation and access situation to be subject to an independent enquiry to be finally sorted out for the good of all concerned.
In the meantime, the Minister should use Section 15 to reallocate quota this year in order to protect under ten metre vessels from imminent disaster and to prevent any abuse of the system through holding an unfair advantage.
Also for your information, it is becoming increasingly clear that there is little if any appetite for the Community Quota Group Pilot that Defra sought to introduce recently.
Out of the 22 applicant Groups, six were chosen, ranging from Hartlepool in the north down and round the south east coast. There were none in the SW as the Cornish FPO, who had originally offered to run one, pulled out on the basis that they refused to include any reallocated quota in the scheme, thereby making themselves ineligible.
From the plethora of phone calls received, it certainly appears that the quota offers provided to the Groups, based on their previous individual track records, do not come close to what they have actually fished from the pool quota. I had e mailed Defra at the request of some members just to ensure that the offers provided were in fact all the fish quota that would be available. Defra has assured me that it is so although I gather that officials are touring the successful Groups in an attempt to persuade them to take up the offers.
Apart from any other considerations, the lack of an amount of quota at least equal to previous catches by the Group members does call into question the veracity and accuracy of the system of recording under ten metre catches bought in during the mid 2000’s under the Registration of Buyers and Sellers legislation. As you know, this puts the responsibility for reporting the landings of the under tens onto the shoulders of the first sale buyers.
We have never been comfortable with this approach, not only because it fails to give due responsibility to the fishermen themselves but also because there appears to be no checks on the effectiveness of the system. When we have questioned Defra with regard to their confidence levels in the data provided, they have only ever answered that it is the best they have. Hardly a ringing endorsement.
We take no pleasure at all in the apparent failure of the Community Groups. We do however maintain our view that there is no evidence that the introduction of a rights based system to the under ten sector will provide any lasting benefits but plenty of examples elsewhere in Europe and further afield that it will cause irreparable harm, not only to the fishermen themselves, but also to the wider fishing communities that they support.
At the same time, we recognize the need to consider a well managed and focused round of decommissioning for both sectors in order to address the outstanding capacity issues that Defra has failed to address over many years.
Any such scheme needs to also include the removal of quota linked to a fishing licence and not only the removal of vessel and licence themselves.
This has been the Achilles Heel of previous rounds of decommissioning whereby an over ten operator takes state aid to remove both vessel and licence from the Register yet is permitted to retain the quota entitlement.
He then has a choice of either becoming a ‘slipper skipper’, sitting back and leasing out the quota to working fishermen or using the state money to buy a more modern and efficient vessel with which to pursue his retained quota allocation.
It is little wonder therefore that the EU Court of Auditors was so critical of publicly funded decommissioning schemes across Europe. In the UK, by Defra’s own admission, they spent about £126 million on decommissioning in the over ten metre sector that in some cases actually increased fishing capacity.
In the event that we do manage to get a well managed and focused decommissioning scheme then it would provide a double benefit to the fleet. By decommissioning over tens, such a scheme would not only reduce the physical capacity of that sector but could also move the state aided quota acquired into the under ten sector to make a meaningful contribution to redressing the balance.
It would of course also be necessary to consider the balance between capacity and fishing opportunities within the under ten sector and as you know, NUTFA’s suggestion for an inshore PO type body begins to address this issue.
NUTFA will shortly be coming to a port near you, and everywhere else around the English coast to publicise the Inshore PO initiative, to answer questions in that respect and to take on board fishermen’s and others comments to hone the idea into a workable system. It will be of particular importance that we make clear that this idea differs from the standard PO model in one major respect, that it would not seek to allocate fishing rights to individuals but would ring fence, protect and manage the existing Pool quota in a more effective way. Management by fishermen, for fishermen.
There are the other benefits to the scheme that you are aware of and I am really looking forward to further refining the approach in discussion with the under ten fleet.
I was intending to also update you on CFP issues but suffice to say that NUTFA is fully engaged with the UK Government, the EU Commission and the Members of the European Parliament in this regard and are actively promoting real change to the current Policy in respect of the small scale fleet through the provision of a number of suggested amendments to the draft text of the next CFP and face to face discussions.