Implementation of the Common Fisheries Policy: Domestic Fisheries Management - Environment, Food and Rural Affairs Committee Contents


2  Reform of domestic fisheries management

Defra's consultation

13.   The need for reform of the current quota management regime has been widely recognised for some time, not least because of the serious difficulties that the current arrangements have caused for the small-scale fleet. Defra's consultation (originally expected before the end of 2010)[4] built on the work conducted by the Sustainable Access to Inshore Fisheries Project (SAIF), and followed on from the final report and recommendations which the SAIF Advisory Group made to Defra in August 2010.[5] In the Ministerial Foreword to the consultation, Richard Benyon states that the aim of the proposed reforms is "to secure a more sustainable future for the fishing fleet as a whole, and specifically [...] to address the issues facing the English under-10m fleet".

14.  The consultation sets out proposals that address the structural arrangements of the English fishing fleet, including an abolition of the quota pools managed by the MMO and a move towards allocation of quota directly to every vessel in the English fleet. The proposals envisage the creation of 'community quota groups' which would allow small-scale fisheries to set up their own quota management organisations. These would have a similar role to POs in enabling quota to be traded between their members so that they can obtain the optimum level of quota for their individual businesses.

15.  The consultation also contains proposals for realigning quota opportunities within the fleet, seeking to address the historic under-provision of quota to the under-10m fleet. As well as looking to reallocate persistently under-fished quota, Defra is also proposing a one-off reallocation of 3% of quota from the offshore to the inshore fleet.

Quota allocation

16.  The fundamental problem facing the inshore fleet is a lack of available quota, due in part to the underestimation of the fleet's capacity when FQA was introduced in 1999. This miscalculation meant that the inshore fleet received a smaller proportion of quota than it might otherwise have done, and, by extension, vessels in the offshore fleet received a higher proportion of quota. As the amount of quota available to the UK under the CFP is fixed, increasing the inshore fleet's share of English quota will necessarily reduce the amount that is available to the offshore fleet.

17.  The New Under Ten Fishermen's Association (NUTFA) were clear in their evidence that a rebalancing of quota allocation was essential if the problems facing the inshore fleet were to be addressed[6] although they, along with the National Federation of Fishermen's Organisations (NFFO), were reluctant to give a figure for what they considered to be a reasonable percentage of quota to be reallocated.[7] It appeared to us that this was due to a reluctance to show their hand whilst negotiations were still ongoing.[8] Defra's consultation sets out its proposed approach to the reallocation of quota.

REALIGNMENT OF UNDER-FISHED QUOTA

18.  First, the Department proposes that quota which has been consistently under-fished by an individual PO during the period 2007-10 be reallocated from the offshore to the inshore fleet (on condition that the inshore fleet has used a high proportion of its current allocation of these stocks).

19.  Defra's consultation document states that "in some cases, this un-fished quota would be of great benefit for the under-10m fleet". However, we note that the FQA will be selected for realignment based on the fishing patterns of the offshore fleet (i.e. whether POs have made use of their quota) rather than the needs of the inshore fleet. We believe that the Department should go further and should identify those stocks and areas where a realignment of quota allocation would be of real benefit to the inshore fleet.

20.   In addition to the realignment of under-fished quota allocations, we recommend that the Department consider, on a case-by-case basis, the realignment of quota allocations for those stocks and areas which are not persistently under-fished but which would be of particular benefit to the inshore fleet. We recommend that a realignment of quota be carried out where such benefit can be demonstrated.

ONE-OFF REALLOCATION OF FIXED QUOTA ALLOCATION

21.  Second, the consultation proposes a one-off reallocation of 3% of English quota from the offshore to the inshore fleet, to be limited to those stocks where the under-10m fleet has fished an average of at least 90% of its initial allocation since 2007. The Department believes that:

The low level of the redistribution will have minimal impact on the Sector in England, but by focussing on those stocks where uptake by the under-10m fleet is high, the benefits will be high. Moreover, making this one-off redistribution removes long-standing uncertainty within the English Sector on what measures might be taken and enables the whole industry to plan with greater confidence for a sustainable future.

22.  Although Defra's proposals are of course at a preliminary stage, we note that the consultation document does not set out any detailed rationale for fixing the level of reallocation at 3%. We are concerned that this figure may have been arrived at by reason of expediency rather than being underpinned by evidence. Past errors in allocating quota caused serious problems for the inshore fleet. In seeking to address these problems it is essential that the Department adopts an evidence-based approach, rather than simply seeking an acceptable compromise between the competing interests of the inshore and offshore fleet. It is unclear from the Department's consultation paper how far, if at all, it has examined the implications of different levels of reallocation across the fleet.

23.  Defra must set out in detail why it believes that 3% is the most appropriate proportion of quota to be reallocated from the offshore fleet. We recommend that the Department conducts and publishes an analysis of the effect that its proposed reallocation of 3% of quota will have on fishing opportunities across the English fleet. This analysis should be conducted before any final decision is made about the percentage of quota to be reallocated.

Decommissioning

24.  A possible alternative to a fixed percentage reallocation of quota away from the offshore fleet is a state-funded decommissioning scheme which would release quota from decommissioned vessels which could then be made available to the inshore fleet. This is the NFFO's preferred solution to the problem of limited quota availability; they argue that having caused the current difficulty facing the industry, the Government has a "moral duty" to fix it.[9] They were not, however, able to put a figure on the costs of such a scheme, noting that it would depend on scale and ambition.[10] NUTFA aligned themselves with this view in our oral evidence session and when asked why Government should fund such a scheme they argued that the situation of the under-10m fleet was not of their own making and it was "unacceptable" for Government to "wash their hands of the mistakes they have made".[11]

25.  The Minister made clear that whilst there may be a role for decommissioning schemes at some time in the future, they would not form a significant plank of the proposed reforms. His reservations were, first, that funding such a scheme would be impractical in the current public spending climate; and second, that previous decommissioning schemes "did not present good value for money for the taxpayer and certainly did not address the chief purpose for which they were intended."[12] In line with these comments, the consultation document does not include any suggestion that decommissioning schemes will be implemented.

26.  We are not persuaded by the argument that the offshore fishing industry should be compensated from the public purse for giving up quota which they originally received only due to Defra's miscalculation. Whilst there may be circumstances in which decommissioning may be appropriate in the future, at a time when public finances are seriously constrained we do not believe that a state-funded decommissioning scheme is an appropriate solution to the problems facing the inshore fleet.

In-year reallocation

27.  Under its quota management rules, Defra has the power to reallocate unused quota in-year. Despite having this power, the Department has never exercised it. This was a key frustration for the fishermen's organisations that we took evidence from, particularly NUTFA who described it as a "nonsense".[13] The NFFO agreed that the Department's inaction was "hard to defend".[14]

28.  The Minister told us that whilst he understood the frustration that some fishermen feel, there were "a multitude of reasons" why quota could remain unused at the end of the year. Defra provided further information on the obstacles to in-year reallocation in writing:

... there are several reasons why the in-year reallocation of unused quota is not currently undertaken. For example, quota holders may be retaining their quota to fish later in the year, or to use as swap currency to acquire different quota. The prospect of reallocation can encourage a race to fish, which could mean that fish is targeted out of season, thus increasing effort and discards of other stocks. Such reallocation may also impact on prices due to a surplus of fish on the market. Furthermore, there is also a risk of 'ghost' fishing[15] in order to secure ongoing access and prevent reallocation—something that is difficult to enforce against.[16]

29.  Defra's proposed reforms focus on a more strategic and permanent reallocation of persistently unused quota and the Department does not suggest making greater use of its power to reallocate quota in-year.

30.  We understand the frustration felt by fishermen who are desperate for additional quota, yet see quota allocated to other vessels going to waste. Whilst we appreciate that simply reallocating this quota towards the end of each year may have undesirable consequences, we believe that the current situation is unacceptable and Defra's failure to address this issue until now has disadvantaged many members of the inshore fleet.

31.  It is important that Defra does not allow the same situation to arise again in future. Alongside the strategic one-off reallocation of quota which is proposed in its consultation, we believe that Defra should also look to make greater use of its power to reallocate unused quota in-year. Defra should design and implement a system which balances the need to avoid a 'race to fish' with sufficient flexibility to allow for in-year reallocations of quota as and when they are required.

Extension of fixed quota management into the inshore fleet

32.  Vessels in the inshore fleet are currently not allocated quota directly, but instead fish against a 'pool' of quota administered by the MMO. A key element of the Government's consultation proposals is that this pool cease to exist, and that FQA be allocated to individual vessels in the inshore fleet.

33.  The NFFO and NUTFA were broadly supportive of the extension of FQA into the inshore fleet, although with two important caveats. First, both organisations were clear that this would only work if a "critical mass" of quota was made available to the inshore fleet.[17] Second, they argued that if the extension of FQA led also to an extension of rights-based management (allowing fishermen to trade quota) it was crucial that safeguards be put in place to prevent quota from flowing out of the inshore fleet and into the hands of bigger organisations.[18]

34.  The Minister agreed that safeguards would be necessary to protect the inshore fleet and Defra's consultation proposes a 'one way valve' to prevent community quota held by the inshore fleet from being sold into the wider fleet. The proposals envisage the possibility of this safeguard being removed in time if a stronger community fleet required more flexibility and the consultation asks for views on whether safeguards should be temporary.

35.  There is much support for the extension of Fixed Quota Allocation (FQA) into the inshore fleet. Should this take place, then the introduction of safeguards to prevent the FQA held in community quota schemes from being sold into the wider fleet is essential. We would be wary of any move to remove such safeguards in future and recommend that this should only take place after a detailed review and once it has been established that the small-scale fleet would benefit from their removal in both the short and longer-term.

Quota trading

36.  Under the current rights-based management regime which operates in the offshore fleet, it is possible for quota to be held by other than working fishermen (i.e. anyone other than an active fisherman—whether a retired or inactive former fisherman, or an outside interest). This quota may then be leased back to fishermen. NUTFA were opposed to this practice, describing it in their written evidence as "an unacceptable use of a public resource, especially one that is the lifeblood of the commercial fishing industry and vulnerable fishing communities".[19] The NFFO took a more nuanced view, agreeing that the bulk of quota should be in the hands of active vessel operators, but arguing that quota trading performed a function and was acceptable "at the margins".[20]

37.  In written evidence submitted after the oral evidence session, Defra told us that it was not possible to determine what proportion of quota was held by 'other than working fishermen'. The Department told us that they were considering establishing a national FQA register in conjunction with the Devolved Administrations which could evolve into a quota trading platform in time.[21]

38.  It is unacceptable that Defra does not know how much quota is currently held by 'other than working fishermen'. We recommend that the Department take steps to develop a register which will allow them to monitor who holds the English fleet's FQA. This register should allow the Department to ascertain what proportion of quota is not held by working fishermen.

39.  We are not convinced that the holding of quota by outside interests is ever appropriate. We expect Defra in its response to this Report to clearly set out and justify its position on this matter, explaining what (if any) benefits there are to this practice. Unless it can be demonstrated conclusively that the holding of quota by outside interests provides a clear benefit to fishing communities, we recommend that Defra take action to limit the holding of quota to active fishermen.



4   See Government's initial response to the final report of the SAIF Advisory Group. Back

5   The SAIF project was established to consider options for the long term reform of the English inshore fishing fleet. As part of SAIF, Defra commissioned several research projects and also set up an advisory group whose membership included representatives of the inshore and offshore fleets, retailers, NGOs, and Producer Organisations. Back

6   Q 21 Back

7   Q 22-23 Back

8   See Qs 19-25 Back

9   Ev 31, para 12 Back

10   Q 35 Back

11   Q 32 Back

12   Q 94 Back

13   Q 50 Back

14   Q 51 Back

15   "Ghost" fishing is the practice of falsely declaring landings where either no fish were landed at all, or the fish landed were of a different species to that declared. It may occur where ongoing access rights are dependent on a track record of catching a specific quota species. Back

16   Ev 34 Back

17   Q 10 Back

18   Q 46 Back

19   Ev 29  Back

20   Q 47 Back

21   Ev 34 Back


 
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Prepared 3 June 2011