Examination of witness (Questions 1-22)|
WEDNESDAY 9 MAY 2001
1. Mr Deas, welcome to the Committee. You know
the form as you have been here before. You have called on the
Government to undertake "a reassessment of priorities"
and "a change of emphasis from short term crisis management
to strategic vision". You also describe the latest Brussels
conservation measures as "the most draconian ever invented".
It does seem, does it not, that the management of the fisheries
policy can only go in the direction of a constant multiplication
of controls and regulations? Do you have a vision for the future
of the fishing industry which might see us moving in the opposite
direction and actually having a more liberal, less regulated regime,
but still consistent with conservation? Can you sketch a scenario
in which that might be an option?
(Mr Deas) First of all thank you very
much for providing this further opportunity to present our Federation's
viewpoint. It is appreciated. I think that the issue is not the
multiplication of regulations, of which there has undeniably been
an exponential explosion over the last ten years in the amount
of regulation to which fishing vessels are subject. The key question
is how effective are those measures. The answer that we come up
with is that despite the fact that our members operate under a
very heavy regulatory burden those measures have not turned round
the stocks. The key question for us is not one of the liberality
of the regime. It is a question of what are the effective measures
that could be put in place to regenerate the stocks and how can
those stocks be maintained at a stable level? That has to be the
priority for us. There is certainly a great deal in the current
arrangements that could be dispensed with under a more rational
regime but, as you, Mr Chairman, in a previous life once said,
if in the area of conservation there is no support for the regime
that is in place it will not work. Our hope and aspiration is
that we can rebuild the stocks, put in place a regime that works
but has at least the tacit support of the fishing industry to
give effect to those measures, which is why we have put forward
our ideas of recovery and government investment in the recovery
2. What is the difference between active support
and tacit support? Why cannot the fishing industry actually say,
"Yes, we have got an interest in conservation and we are
going to make it work"? One almost gets the impression that
it is almost a sort of cultural thing, to be agin whatever system
of regulation is in place. Is that unfair?
(Mr Deas) I think there is a historical aspect to
this, the fact that the regime we have is very much seen as being
imposed from outside and, as well as that, ineffectual. That double
whammy, those twin aspects, lead to a cultural view that they
are out to get us. The evidence is that the industry certainly
south of the border is withering on the vine. It is not a view
that is completely without validity.
3. How does one get out of this cycle then in
which you have described as draconian the conservation measures
which have been introduced? The industry says, "If you apply
these we will not be able to earn a living and the industry will
collapse, but if you do not apply these then we will not be able
to earn a living and the industry will collapse". How does
one escape from that cycle of ever more draconian measures as
it were for a conservation policy which appears, in your words,
not to be working?
(Mr Deas) I think the critical factor, and you have
put your finger on it, is the short term losses associated with
effective conservation measures. Anything that is meaningful in
terms of conservation will have short term losses for the vessels.
The scientists can give you figures year by year on what that
would mean for each stock. If we were to increase mesh size, for
example, or have a closed area or tie the fleet up, the scientists
can generally tell you what the short term losses will be and
what the long term benefits will be. That is the focus that we
have to keep in mind, those long term gains. That can be four
years, it can be five years, it can be six years, but in the end,
if the measures are taken, the stocks will rebuild and there is
awaiting us prosperity. This is the critical point about the fishing
industry. It should have a bright future. It is based on a renewable
resource and the product which we present to the market is in
demand and in growing demand. All the variables are there for
a successful industry. What we have to get right is the stock
management. Bridging the gap between the short term losses and
the long term gains has to be the focus of government policy in
our view and government investment is part of the picture. We
call it investment, not subsidy, quite pointedly because this
is a win/win situation for the industry and the Government in
our view. An industry operated on stable, rebuilt stocks to safe
biological limits, would certainly provide the basis for a prosperous
fishing industry but would also provide the Exchequer with a great
deal more income than is presently the case. The Government has
recently invested some £93 million in enforcement: new patrol
vessels and a new research ship. These are all vital in our view
but we have to ask ourselves what for if the stocks are in decline;
if we do not get the stock management right. And from our point
of view that involves a change of strategy, a longer term view,
there really is not a great deal of sense investing in the accoutrements.
4. Is there a bright future for the industry
in its present size or do you agree with the Commission that it
has to be a smaller industry?
(Mr Deas) Our Federation has agreed reluctantly that
a decommissioning programme is necessary. In the context of these
recovery programmes that are coming forward from Brussels, a smaller
fleet would make those measures easier to take. We would not necessarily
agree with the Commission's view that it has to be of the order
of 40 per cent, but certainly some reduction in the size of the
fleet makes it easier for those who remain. Ours is a twin track
approach. We advocate a degree of decommissioning but also transitional
aid for those who remain in the industry.
5. In what was, I think, generally a widely
welcomed report by this Committee on the fishing industry we drew
attention to the need for an agreed strategy for the industry
involving government and the key players in the industry itself
and made the statement that one of its objectives should be to
minimise the complexity of regulation while maximising the responsibility
for that process given to the industry consistent with securing
compliance. Has any progress been made towards meeting that goal?
(Mr Deas) The Sea Fish Industry Authority, at the
request of the Fish Industry Forum, has produced a strategy document.
It was rather hurried and I think that that strategy document
and our Federation and the industry at large have been knocked
sideways by the impact of the numerous recovery programmes that
are being generated by the European Commission presently. We have
the second year of the Irish Sea Cod Recovery, we have North Sea
Cod Recovery, we have Hake, we have West of Scotland cod. All
of those involve numerous meetings in various parts of the European
6. So you have not been able to focus too much
time on the longer term because the short term is so threatening?
(Mr Deas) Quite. I think that is it in a nutshell.
There are some aspects of the recovery plans that are positive.
For example, there seems to be an implicit acknowledgement that
regional consultation and regional management, which is one of
the main objectives of our Federation, is de facto the
way to go and the consultations have been on a regional basis.
7. One of the key recommendations in our report
was to see transfer of responsibility to the industry itself to
regulate its own behaviour in its own best interest. Has there
been any sign of that actually happening?
(Mr Deas) I cannot see that there have been large
leaps and bounds in that direction. As I say, the recovery plans
show that the Commission are increasingly consulting on a regional
basis which is a positive sign. The 2002 Review will provide for
institutional changes in that direction. The question is how far
and how fast they will go. Certainly from where we sit I would
not say that there has been dramatic change in that direction.
8. Do you think, Mr Deas, that the industry
can go on trying to have its cake and eat it? If you go back to
the immediate post-war period and look, for example, at the work
that Lowestoft did on cod stocks, it is self-evident that if you
leave the fish alone for long enough large stocks will build up.
Yet the industry, which has a rapacious desire to fish everything
that moves, backed up by the arrival of modern technology, has
relentlessly pursued stocks in certain cases to a scientific view
that it is almost to extinction. Is it not the case that the industry
has brought some of these problems on itself and then turns round
and looks for assistance from others to try and bale it out from
its own self-imposed problems?
(Mr Deas) I think that fishermen fish and the key
issue is what sort of framework do they fish within. It is the
regulatory regime that matters because I suppose, left to themselves,
each individual fisherman, each individual vessel, will fish to
the maximum. I think it in turn is naive to simply blame the industry
for doing what comes naturally to fishermen. What we have to get
right is the regulatory framework. That is the key point. It is
that which has failed and that we must get right. What we say
is that a combination of tough conservation measures and government
investment in stock recovery, whether that government is national
or European, is the prerequisite for rebuilding stocks to within
safe biological limits. I certainly think that is desirable, but
I also think it is achievable.
9. You could argue that somebody looking at
the figures, which show that the industry is worth, landed catch-wise,
£662 million a year, might wonder what all the fuss is about
because it is a relatively small industry; 75 per cent of our
fish that come into the United Kingdom come from non-UK sources.
Why do we not all back off, have a rest and let the stocks recover
and just import fish from elsewhere? Give me a raison d'e®tre
as to why we should continue to be concerned about a relatively
small industry. Some big industries like coal mining have recognised
that there are changes in the way that energy is supplied and
there has been rationalisation. We will not have a debate on that.
There has been a lot of pain and suffering but that has occurred.
Could you argue the same case for the fishing industry?
(Mr Deas) I think that the viewpoint you describe
is one that appears to have been taken by the Treasury. If we
look back to the early 1990s, the absence of the decommissioning
scheme at that stage allowed the Dutch and Spanish to acquire
a large number of licenses and the quotas associated with those
licences, so from our perspective and the fact that the industry
is disappearing, particularly south of the borderand if
I may make one criticism of the 1999 report it was that yes, there
are bright spots within the industry, notably the pelagic sector,
but there is a danger in averaging. You can miss some of the salient
points. Certainly south of the border the industry, particularly
in the wake of the fuel crisis, is in desperate straits. Whatever
sector you look at, whether it is white fish, beam trawl, gill
net, all of them, certainly the demersal fisheries, are under
a great deal of pressure. The question is, do we want a fishing
industry in this country, an indigenous fishing industry? From
our point of view the answer is self-evident. From an external
point of view it has to be for others to make that judgment. I
certainly do not detect from the people that I speak to that there
is a willingness publicly to let the industry go down the tube
but that does not appear to be matched within government as a
Mr Mitchell: That line of questioning is fascinating
because the same advice should be given to the car industry and
the steel industry and the textile industry: back off and give
it a rest and let the competition take over. I think that is very
sensible economic advice. It is extraordinary, just to redress
the balance of questioning in this Committee, that the fishing
industry has managed to sour the attitudes of two former Tory
Ministers who were responsible for it. Now they are attacking
them as whingeing scroungers.
Chairman: You have not heard Mr Todd fully yet.
Mr Jack: Could I on a point of order just say,
Mr Chairman, that because one asks probing and searching questions
to allow industry representatives to have their say about justifying
their line of policy it does not necessarily mean that the question
is attacking the industry. I am disappointed that Mr Mitchell
launches such a vitriolic and personal attack on the Chairman
of this Committee and other members when we are merely seeking
Chairman: Now Mr Mitchell will ask his question.
10. If I were to be attacked in the same way
I would give the same pompous reply. The essence of what I draw
from what you are saying is that if the fishermen were involved
in the formal issue of policy and if they felt it operated fairly
so that any reduction of catches or effort or conservation measures
on their part would not be immediately undermined by competitors
coming in and taking advantage because they are not as effectively
policed, then we would have a much healthier situation because
the industry would be a stakeholder in its own future. That has
been a formula for success in Australia, in Canada, in New Zealand,
in all the other countries which have taken their 200-mile limits.
The problem is a common fisheries policy which is largely political
and which is not administered with equal justice between the states.
(Mr Deas) There are two problems we face. One is,
as I have said, the failure of the management regime to halt stock
decline. The other one is distorted competition and these are
intertwined with each other. That is why we are in the dire straits
that we are in today. The fuel crisis was a classic example when
the governments of France, Belgium, Ireland, other Member States,
jumped to their industries' support, saw this as a short term
problem, gave them the support that was necessary to see the spike
in oil prices pass through, and then, with the industry on a stable
keel, backed off. That was a classic example of the difference
between the way the British Government through successive administrations
has treated this industry and the way that the industries have
been treated in other Member States.
11. And the conclusion from that is that those
industries which are better financed to survive the immediate
problems will be there to grab the opportunities provided once
the conservation problem is in order and to buy up British licences
and quotas as they did in the early 1990s.
(Mr Deas) There was a very real fear during the crisis
in oil prices that that was precisely what would happen, that
there would be a second wave of quota hopping and further licences
would go to the highest bidder. Who would the highest bidder be?
They would be those vessels from those Member States that had
received government support.
12. Having got that off my chest can I come
to the specific question I was asked to ask. You mentioned the
plea for financial assistance which I think is a very strong one
and said that the Government's offer of £22.5 million, whatever
it is, is minimalist. What are your priorities for the industry
and how have you costed it? What would go on decommissioning?
What would go on new gear and re-equipment? What would go on simply
financing the industry to come through the period of reduced catches,
bridging that gap you mentioned?
(Mr Deas) We have not got a formula as such, how much
on decommissioning. What we need to do is re-focus on the recovery
programmes and invest in the recovery programmes. That could mean
decommissioning, it could be mesh size, it could be more selective
fishing gear through things like square mesh panels and grids,
it could be closed areas. Which particular measure we would be
talking about would depend on the particular region we are talking
about. What is appropriate for the Irish Sea would not necessarily
be appropriate for the North Sea. What we would want to do is
secure a commitment for the Government to talk to us about investing
in the recovery programmes and sit down with government and talk
about the appropriate balance in each area.
13. Why do you say that the Treasury has been
so hostile to a policy of support or aid for or investment in
the fishing industry? Is it because of the Fontainebleau formula,
that they do not want to put up the money which other nations
are prepared to do to get matched funding from Europe because
we have received so little from Europe and others have received
so much, or is it just a general desire to save gambling on it?
(Mr Deas) We have no idea because despite numerous
requests for meetings with Treasury Ministers those have been
declined. We can only go on the basis that we have had frequent
meetings with MAFF ministers to discuss the fuel crisis, to discuss
the economic consequences of the recovery programmes, the closed
areas, the new gear, and we have been met sympathetically. We
have not been challenged on either the economic consequences that
we have foretold would be the impact, nor with indeed our analysis.
But time and time again when we have met for the second, third
and fourth times, the response has been, "Well, we have made
approaches to the Treasury but the Treasury are not playing".
The six million pounds was for decommissioning; the £22 million
was the combination of a variety of elements including components
of European funding that had been announced a year before, but
even the six million only materialised as a result of the Scottish
Executive breaking ranks and providing an aid package for their
industry. The arguments that in fisheries there would always be
consistency north and south of the border as far as possible became
too great to sustain so you had a conflict between the government
policy on devolution and government policy on aid. From our point
of view six million pounds was scrambled together out of the existing
MAFF budgets. There was no new money in there. The Treasury certainly
did not contribute anything. That was then made to appear to be
some sort of equivalent to the £25 million for decommissioning
in Scotland which we found incredible and still do.
14. What about the impact of Fontainebleau?
(Mr Deas) Fontainebleau is always trucked forward
as one of the arguments. What weight that actually has I will
leave to others to say. From our point of view the British taxpayer,
because Britain is a net contributor to the EU budget, has contributed
to the modernisation for example of the Spanish fleet, the French
fleet but not the British fleet because it is all too difficult
because of Fontainebleau, which seems outrageous from our point
15. You calculate a drop in earnings of £70
million or £80 million. Several fishermen in Grimsby have
put it to me that they are on the verge of going bust and they
are just not viable. Has your prediction of a drop of £70
million to £80 million been justified so far and what proportion
of the industry are in a position of just fishing on but not viable?
(Mr Deas) I think the point is that we have got recovery
plans right round the coast and they impact not just on the specific
fisheries, for example, cod, but they will also have an impact
on associated fisheries where vessels are diverted from cod on
to nephrops for example or from hake into in-shore fishing. Calculating
the direct losses is a difficult task because of the consequential
impact on other associated fisheries. There is absolutely no doubt
about it that many vessels are on the brink of insolvency as a
result of the combination of the recovery programmes and the impact
of the fuel crisis. I do not think the industry has ever been
so low. It is extremely despondent and dispirited. I have absolutely
no doubt that the six million south of the border will be snapped
up by people who are desperate to leave, either that or pushed
by their bank managers. It is a desperate situation. From our
point of view it need not be that way. If we went into negotiations
in Europe and said, "What sort of mesh size is consistent
with the stocks that we have, the recovery, the rebuilding, and
what would the short term losses be, what would the long term
gains be?", and those short term losses were underpinned,
fishermen's incomes would be underpinned while those short term
losses went through, then you would have the basis of a movement
to a viable fishing industry and we would not have to look for
handouts or government assistance. I think this is the point,
that what we are looking for is not long term subsidy but a short
term, time limited, financial package to move us to a situation
in which we would be sustainable and financially viable.
16. Amazingly, it is true to say that the first
political speech I ever made was during the cod war when I had
to defend Iceland and where I won by 19 votes to 17. The reason
by way of introduction that I say that is that I have always had
a slight interest in Iceland but as a lay person who does not
really know a great deal about the financial structures in other
countries I hear you saying that other countries tend to have
been more supported by government. A country like Iceland, with
whom we have competed in the past, what is their financial structure
in comparison to ours? I know the figures will be different because
of the different sizes, but just in strategic terms.
(Mr Deas) The most important feature about the Icelandic
system is their reliance on individual transferable quotas. They
have a company sector and their artisanal sector. The full blown
system of ITQs appears to work reasonably well there. I think
in fisheries where you have a single species fishery, principally
a cod fishery there, overwhelmingly a cod fishery, it is a system
that can work. There are down sides to it inevitably. It does
mean a monopoly of fishing opportunities by those who hold the
rights. We have a kind of hybrid system at the moment in the United
Kingdom where quotas are held by producer organisations, collectives
of fishermen, but there within that system a fair degree of latitude
to trade quotas. However, with the key stocks being in the state
they are there is not a great deal of trading going on at the
Chairman: It is probably true in the pelagic
sector that we are not a long way from ITQs. They are within practical
17. Given the current interest in the total
re-negotiation of the common agricultural policy what hopes do
you have that that radical re-thinking which followed in train
in other parts of the Community will transcend into fishing? Is
that something you would support?
(Mr Deas) You do mean the common agricultural policy?
18. I mean the common fisheries. We have got
just now an understanding that we cannot go on the way we have
been going with the CAP. Do you think that is something that will
follow in train now with the fishing industry?
(Mr Deas) There are some hopeful signs given the fact
that the Commission's Green Paper on the common fisheries policy
for the first time acknowledged that the common fisheries policy
in its conservation aspects has not worked, and if it is to work
radical changes are required. Certainly some of those changes
we would support. How far those will be taken up we will find
out during the course of next year. We are just at the start of
the process on the Green Paper at the moment. I think we would
have to say that we are hopeful that the movement is in the right
direction. The key question is whether there will be many of us
left here to take advantage of it because, as I said before, there
are many vessels within our membership that are in desperate straits.
Certainly the way things move within the European Community, not
with the speed of light, that would be our principal fear. Things
like the involvement of stakeholders, the involvement of the industry,
the regionalisation of decision making and advisory functions
are all movements that we think would be in the right direction.
Unfortunately they are somewhat contradicted by the current use
by the Commission of its emergency powers and the draconian measures
that they have introduced and more are in the pipeline under these
recovery programmes. They have the authority to introduce measures
that last for six months and the closures in the Irish Sea, the
West of Scotland and the North Sea were brought in under those
measures and likewise the very draconian increase in mesh sizes
which is proposed, if it was introduced without derogation, would
certainly make large parts of the United Kingdom fleet, both north
and south of the border, unviable.
19. Obviously you make great play, and no doubt
other fishermen will make great play, of the differential regulation.
Can you give us some examples of where that occurs and what the
impact of that is?
(Mr Deas) In the previous evidence we gave we listed
things like satellite monitoring, where the other Member States
paid for the installation of the equipment whereas the United
Kingdom did not. There were light dues, there was tonnage re-measurement.
We too would like to have a systematic understanding of the regulatory
costs associated in the different Member States and have urged
both through the Commission and through the Fish Industry Forum
for a study which we thought would be funded by the European Commission
but have heard recently that that has been turned down. That would
give a systematic basis to our claims.
20. In a sense one of the ways to sort out regulation
is to have a more federated scheme where you have a sort of common
policing. Is that something you would encompass given that most
fishing organisations would want to move in the other direction?
How do you square the circle there?
(Mr Deas) I think there is a tension there because
on the one hand we do believe, and indeed the Commission's own
reports have confirmed, that the United Kingdom is somewhere towards
the top of the league in terms of enforcement, but other Member
States do not do quite as well. Whether we would want to transfer
the powers currently held by the Member State to the Commission
is a step probably too far and I think that viewpoint is shared
by the Member States. The Commission have proposed a halfway house
which is an agency which would involve enforcement bodies collaborating
at a European level but not actually surrendering their powers.
That could be a halfway house. That could be a way of squaring
the circle as you say.
21. Can you explain the concept of zonal management
that you say is a way in which you could possibly produce more
of a level playing field, if that is not a contradiction in terms
on the sea? Is this the way forward? Are you getting a sympathetic
ear from this government and subsequently the Commission?
(Mr Deas) The current system operates on the basis
of decisions made by the Council of Ministers on a proposal from
the Commission. That is too inflexible a system for day to day
fisheries management issues. I think that is generally recognised.
Zonal management would focus on natural sea areas, whether that
is the North Sea or the Western Approaches or the Irish Sea, and
would have at its heart a committee involving the industries of
the various Member States that have fishing entitlements in that
area, scientists and representatives of the Member States. They
would essentially be the decision makers for that fishery. The
formal decision making structure might have to remain with the
Council of Ministers but we would hope that that would be a rubber
stamp for long term fishing plans for the next four to five years
that are put forward by the zonal committees. As to whether that
is likely to be a model that is adopted, I think there is movement
in that direction already. The consultative forums for the recovery
plans have all followed that type of model with the Member States'
representatives, the industry and scientists in the same room
for the first time, so there is some movement in that direction.
The weakness in the present arrangements is that we simply perform
for the Commission who cherry pick the elements they like and
implement those, whereas we as a federation would want that group
to have authority to make the decisions themselves. The Commission
would probably have a role as a Chairman in that sort of function
but would not have the final say, would not be the final arbiter.
22. You have outlined your own industry's recovery
programme and ideas. How much support does that command with your
sister fishing representative organisations in other Member States?
(Mr Deas) On the zonal management front I think many
Member State industries were quite sceptical to begin with. Over
the last three years the dialogue that has taken place I think
has convinced most of them that some decentralisation of the common
fisheries policy is desirable. Some of them would want to ensure
that the zonal committees would have advisory functions only and
they would be a little anxious to go beyond that at this stage.
From our point of view that in itself would be a significant step
forward in the direction that we would want to go. As to the content
of the recovery plans, it is difficult to give a sweeping answer
to that because the content will depend on each individual zonal
management committee. The basic approach, which would be the zonal
management committee advancing a fisheries plan for the next few
years covering things like the level of TAC, not, I would like
to underscore, the share of the quotathat would be governed
by relative stabilitybut the TAC perhaps over two or three
years, the mesh size, the selectivity gear, the kinds of things
that make a difference not to the share of the cake that people
get but the size of the cake, that is our overall focus, the size
of the cake, not the share.
Chairman: Mr Deas, thank you very much indeed.
You are very welcome to retire to the rear of the room for the
Minister's evidence. Thank you very much for coming to what is
the last meeting of this Select Committee in this Parliament.
None of us knows quite what shape it will take in the next.