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Lord Pearson of Rannoch: My Lords, I am sure that the noble Lord, Lord Carter, enjoys the sympathy of the House for the unpleasant task that he has just performed. After all, we know that he is no lover of the common fisheries policy because in the last Session of Parliament the noble Lord opined to the House that if there was one European policy more crazy than the common agricultural policy it was the common fisheries policy. Indeed, only a week ago, the noble Lord confirmed that view (in col. 1479 of Hansard) when he said:

So I, for one, can understand the noble Lord's discomfort at having to perpetuate this evening one of the most damaging aspects of the common fisheries policy; that being the decommissioning of vessels.

Nor is the Minister alone in holding such beliefs within his party. In 1995, two years ago, Mr. Gavin Strang (who was then the Labour spokesman on agriculture and fisheries) put one of the problems rather well. He said:

    "Surely the Secretary of State for Scotland and his ministerial colleagues understand that it is unacceptable that we should be decommissioning vessels to facilitate additional fishing opportunities in waters around the United Kingdom for the fishing industry of one of our European partners, in this case Spain".

The figures which Mr. Strang may have had in mind are that Spain is to receive some £721.32 million between 1994 and 1998, under Objectives 1 and 5a of the Financial Instrument for Fisheries Guidance. In addition, an unknown sum from the structural and

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cohesion funds may be finding its way towards the upgrading and upkeep of the Spanish fleet. The UK generally pays some 14 per cent. of these figures, so we are looking at at least £100.98 million of our money going to Spain under these headings.

Then there is the money which the EU pays for the right to fish in other countries' waters outside the EU. For the four years from 1996 a total of £637.89 million has been spent in this way, of which the UK's share again comes to 14 per cent., or about £90 million. Here again, Spain is the principal European beneficiary. Most of the recipients of that money from the EU are poor third world countries, whose boats cannot compete with the highly efficient EU fleets. So I suppose one can also be forgiven for wondering how much of this money actually gets through to the fishing communities in question.

All this leads me to put a question to the Minister, which I put fairly regularly to the previous government without the benefit of a clear reply. It is quite simply this: is the UK paying more money to Spain to build and maintain boats to come and take fish from what used to be our waters than we are paying to our own fishermen to destroy their boats and, I might say, their livelihoods?

Further, can the Minister say whether it is true that this scheme splits licences from track records? In other words, when we destroy a boat, is the quota of fish that it used to catch cancelled or is it shared out among the remaining boats, a large number of which will be Spanish and highly sophisticated and powerful? If this is so, does the Minister agree that fishermen go out of business but the stock of fish is unlikely to be conserved? I believe that the Minister said something about track records possibly being, under some pilot scheme, shared out in future. Can the noble Lord confirm that point in greater detail in his response?

I suppose the noble Lord may be tempted to answer my criticisms by saying that a Conservative Government under Sir Edward Heath took us into the common fisheries policy in 1972. That is of course quite true, and I, for one, make no excuse for such an act of treachery, nor have I ever attempted to do so. But we now have New Labour in power and, during the election campaign, we were promised that the CFP would be reformed if New Labour won the election, thanks to its new ingratiating stance in Brussels. Can the Minister tell us how the Government are progressing on this one? To be precise, what is the latest state of play in the voting system required to reform the CFP? Are we any nearer to adequate reform now than we were under the Conservative Government? Or is the only way to get what we want and need for our fishermen in fact to leave the Treaty of Rome, which in any case seems increasingly redundant nowadays? I look forward to the Government's reply, and apologise again if these questions cause the Minister any personal embarrassment.

Lord Newby: My Lords, I am breaking new ground in speaking in the debate this evening. It is a long-held Liberal Democrat policy that the only people who are allowed to speak on fisheries policy are Cornishmen and

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Scotsmen. However, I make no apologies to my colleagues in the party for speaking on the matter. My experience of the fishing ports is not as great as that of some of my Cornish colleagues in particular, but having spent 20 years of my life regularly visiting the east Yorkshire ports of Bridlington, Scarborough and Whitby, I am only too well aware of the importance of the fishing fleet to those communities. I am also very well aware of the effect that that experience has had on my thinking about fisheries; namely, the greater importance that fisheries play in our national life than the simple figures of the number of fishermen employed or the number of fishing boats at sea imply.

Decommissioning is a necessary evil. There will be no long-term future for the fishing industry unless fishing stocks are given the chance to recover and, having recovered, the fish are then harvested at a sustainable level. No one who cares about the long-term future of the fishing stocks and of the fishing industry can, in my view, legitimately argue with the principle of the regulations. Indeed, despite the criticisms that might be made about the policy, one should be aware that in some areas at least fishing stocks are now increasing. Without a fishing policy and without a common fisheries policy, I suspect that that would not be the case.

Lord Pearson of Rannoch: My Lords, I wonder whether it is in order to ask the noble Lord a question. Is he aware of the examples of Norway and Namibia both of which have taken back control of their waters, and the fishing industries are doing very well as a result?

Lord Newby: My Lords, I am aware of the example of Norway, but I cannot claim to be aware of the Namibian example. Anyone who believes that a common resource such as fish, any more than many other aspect of common resources of the environment, can be dealt with purely on a national basis will be mistaken in the long term.

I was about to say that the background to the issue is, in my view, the depressing failure of the previous government to grasp the nettle and introduce a decommissioning scheme at an earlier stage. That played a major part in the development of the abuse of quota-hopping and the sad spectacle, as the last election approached, of fishing Ministers going to Brussels making ever-more blood-curdling threats and coming away having achieved nothing. It is perhaps not surprising that, as a result, many fishermen found it difficult to support their traditional party.

I turn now to the details of the scheme. There are some aspects of the changes in the new scheme over those in previous schemes which we welcome. For example, we welcome the decision to allow vessel owners to secure the value of their track record. We also obviously welcome the fact that there will be more money available, although in doing so we note that the expenditure in this country is considerably less than that which has been made available over a number of years in some other member states.

However, some things in the scheme have not changed and we wish that they had. We know, for example, that there is still the policy of scrapping

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vessels as being virtually the only way of dealing with their decommissioning. In our view that is a classic case of a gold plated regulation and a more rigid application of it than applies elsewhere. I note that the only exemption from that rule is for fishing vessels that find their way to museums. I would love to know how many decommissioned fishing vessels have found their way to museums. I hope the Minister can tell me that. I suspect that is hardly an important aspect of the scheme.

If one looks more generally at the common fisheries policy, I think anyone must accept that there is one aspect which is simply not working. I suspect that the noble Lord, Lord Pearson, might agree with me on this point. I refer to the question of enforcement. If the fisheries policy is to achieve its goals it simply has to be enforced more rigorously than is the case at the moment. As we have a common fisheries policy this is obviously an EU matter. However, I wonder whether the Minister and his colleagues might consider whether, as part of their activities during our presidency of the EU, more impetus could be given to the whole question of enforcement of the common fisheries policy as this is one of those areas where failure tends to bring the whole policy into disrepute.

I cannot leave this issue without referring briefly to the wider problems of the fishing communities and the regions in which they are found. In the case of Cornwall, for example, even the most optimistic person on the future of the fishing industry does not believe that it will be capable of lifting the whole region out of high unemployment and low income levels. There is, therefore, a compelling case for a range of employment generating initiatives, of which in Cornwall the establishment of the university of Cornwall and the establishment of a regional development agency are probably the most important. We shall press for progress on both those initiatives during the course of this Parliament. However, whatever is done on these alternative methods of employment, it is difficult to imagine Cornwall, or indeed east Yorkshire, without a strong, viable and sustainable fishing industry. The scheme under discussion today will play a small part in making that possible.

8.5 p.m.

Lord Mackay of Ardbrecknish: My Lords, this is the first time I have talked about fishing in this House since I entered it. Part of the reason for that was that while I was a government Minister I never had responsibility for fishing, and another reason was that prior to joining the Government I was the chairman of the Sea Fish Industry Authority and I decided that I was precluded from discussing fishing matters, whether or not that was actually the case. Therefore this is my first opportunity to discuss fishing in this House. I could be tempted to make a far more wide-ranging speech than will be the case. I was almost tempted by my noble friend Lord Pearson and the noble Lord on the Liberal Democrat Benches to make a slightly more wide-ranging speech on general points about the common fisheries policy. However, I shall resist that temptation.

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This decommissioning package is part and only part of the policy on fishing, both the common fisheries policy and the policy on fishing of the British Government. It is difficult to talk about a specific part of decommissioning without discussing some other parts. Therefore I shall probably make a slightly more wide-ranging speech, but I shall try to resist the temptation to speak too widely.

The primary purpose of the scheme is of course to spend the £12 million which was budgeted for and which is the final tranche of the 1992 scheme. As the Minister rightly pointed out, the scheme will deal with the current unmet capacity reduction targets under the multi-annual guidance programme. As the Minister rightly pointed out, there are two differences between this scheme and the previous schemes. The first is the exclusion of Nephrops vessels from participation on the ground outlined by the Minister that this sector has fulfilled the capacity reductions laid down.

I do not think it is quite as simple as that. As the Minister will know, the Nephrops fishermen around the coast are not at all happy that they have been excluded from the decommissioning. My reasoning for thinking it is not entirely wise to exclude that section is that the sections of the fishing industry are not self-contained compartments because vessels and fishermen move from one sector to another. People change from fishing principally for white fish to fishing for Nephrops. More importantly, I think it is fair to say that older vessels tend to find their way into the Nephrops fleet. I suspect that is why the Nephrops fleet took up the decommissioning on offer. That will still be the case. Looking at the whole fleet, if Nephrops vessels wish to come out of the fleet, I suspect that will create openings in the Nephrops fleet for vessels in rather more heavily fished parts of the fleet. I underline the point that the Nephrops fleets in, for example, the west of Scotland and, I suspect, in Northern Ireland are not happy about the discrimination against them.

Further, there is the point about allowing fishermen to dispose of the track record separately so that the grant scheme will relate only to the value of the vessel and not to the value of the track record. I am not sure that I can join the noble Lord on the Liberal Democrat Benches in welcoming that, for two reasons. First, it suggests that the industry itself might be part funding this decommissioning; in other words, the boat being decommissioned will get some of its money from the scheme and some of its money from its track record--and that means from other parts of the industry. What is perhaps more worrying, I do not think there is anything to preclude these track records from passing into the hands of the flag ship operators. That will make the position on flag ships even worse.

The position on flag ships is relevant to decommissioning because the industry feels strongly that the two issues are linked. I shall not discuss the history of this. We tried hard as a government to find a legislative way to stop quota hopping. We thought we had done so as we had received some sound legal advice on the matter. Unfortunately, the European Court decided that we were wrong and that we could not do it because the common fisheries policy, which was

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designed not by Ted Heath but in the early '80s, was inconsistent with the Treaty of Rome. My view of that is that the European Court may have had logic on its side but it did not make a sound judgment. It ought to have considered the matter in the round. Undoubtedly the people who created the common fisheries policy thought they were working within the treaty and thought they were doing the right thing in tying quota to country. They did not envisage in any way that there would be any quota hopping. Therefore I believe that this is a linked problem.

The previous government had said very clearly that they would not go down any of the MAGP IV routes until this problem of quota hopping was addressed. The noble Lord on the Liberal Democrat Benches said that we were making belligerent noises. That was the case. However, all we have heard from the Government is that there is an exchange of letters between the Prime Minister and the President of the European Commission saying that something will happen. A few months have passed since June when the letters were exchanged and nothing seems to be happening. I wonder where we are on these issues.

If one limits effort, because that is what decommissioning is about, and one moves into a MAGP IV situation where there are limits to efforts, which means that vessels are forced to tie up for a certain number of days in the year, I wonder what the consequences of that will be. I can see a link between restriction of quota and restriction of days at sea. If one needs only to spend a couple of hundred days at sea to catch one's quota, perhaps it is easier to judge one's fishing effort in terms of days at sea. However, I know that the industry is not convinced about that. We would have to do much more work before we replaced quota with days at sea. I must tell the Minister--this has always been said by fishermen--with his knowledge of agriculture that fishing is an industry which receives little money from the taxpayer in comparison to agriculture.

If we go down the route of restricting the number of days fishermen go to sea that looks--dare I say?--not unlike agricultural setaside. To this Government, and to the previous government, many fishermen said: "Why can we not have the same kind of payments as the farming industry enjoys on setaside?" I always found my answers less than convincing; and I do not suppose that the Minister's answer will be much better than mine.

All these measures are designed to protect the stocks. When I read the results of the European Fisheries Council as announced by the noble Lord, Lord Donoughue, to the noble Lord, Lord Williams of Elvel, on 4th November, I was disappointed on a number of matters and approved of a number of matters--for example, gradual increase in the size of mesh provided it is still realistic. I was glad to see that the Government resisted an increase to 110mm in the North Sea, but there is an argument for a gradual increase in mesh size elsewhere around our coast from 80mm to 100mm. I was disappointed to see that the square mesh idea was not being adopted other than in the nephrops nets. The nephrops nets having square mesh panels is a

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considerable improvement; however, square mesh could be used rather more widely in fisheries. When I was chairman of the Sea Fish Industry Authority I advocated that change quite firmly. We were absolutely convinced by research done by the authority that it allowed for a better escapement of under-sized fish.

I did not fully understand the point about minimum landing sizes being changed in order to reduce discards. While it is not all that relevant, perhaps the Minister will write to me.

My final point relates to the interesting fact that the only other subject which the Minister in the Commons decided to take up with the Commission was progress on driftnets. I should like to have seen from the Statement that he had taken up the need to make progress on quota-hopping. However, if it has to be driftnets, it has to be driftnets. My question--and I am sure the noble Lord, Lord Williams of Elvel, will also be interested in the answer--is: does the definition of "driftnet" cover driftnet fishing off the Northumberland coast of England, which is an interceptory net to the salmon returning to the Scottish rivers?

8.15 p.m.

Lord Carter: My Lords, we have had a lively and interesting debate on issues which will be very material to the long-term survival of both the fishing industry and the stocks on which it depends. I am grateful to all noble Lords who took part.

Perhaps I may first make a general point, and then deal with questions in so far as I am able. Improving the balance between catching capacity and what stocks will bear is fundamental and, I hope, common ground between all concerned, be they politicians of whatever party, fishermen of any member state or the scientists and administrators who have the very difficult job of devising and implementing the policies required. The problem, which we all understand, is that the equation between capacity and fishing effort, or fishing effort and fishing mortality, is not straightforward and varies according to the circumstances involved. A broad brush approach may penalise legitimate fisheries of no conservation concern, but a finely targeted approach will inevitably be much more complex to administer. The MAGP process has discernibly shifted from broad brush to fine targeting over the past few years, bringing with it a legacy of outstanding issues.

I now turn to the many questions that were asked. I am pleased to see the noble Lord, Lord Pearson of Rannoch, in his usual place on the common fisheries policy. In relation to the remark I made about the CAP, I can only say that I should learn my lesson. You should never try to make a joke in this House, because it comes back to hit you. I congratulate the noble Lord on the assiduity with which he read Hansard.

To turn first to the noble Lord's question on decommissioning and facilitating quotas for other member states, he is not correct: the quotas of other member states are not affected by decommissioning, which concerns fleet size.

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The noble Lord asked about the money for Spain. Spain has the largest fleet in the European Union. It is therefore not surprising that it receives a significant share of EU money.

Another question concerned money for building boats in Spain. That is true, because Spain has met its MAGP targets and does not compare directly with UK expenditure on decommissioning, which is still needed to meet the targets which the previous Administration failed to meet.

I was also asked about transfer and track records. We decided to detach track record from licences following requests from the industry and after full consultation, which showed strong support for greater flexibility in the use of track records. Moreover, as there is a financial value associated with track records, and mindful of the need to try to reduce the level of bids so that the taxpayer will receive better value for money from decommissioning, we decided to take account of that on a pilot basis to see whether that would have any effect on the value of bids. The noble Lord referred to the former Prime Minister, Sir Edward Heath, accusing him of treason. That was a little on the strong side, even for the noble Lord.

The system of voting on the common fisheries policy is by qualified majority, as required by the treaty. There are no plans for changing that.

I welcome the noble Lord, Lord Newby, who is speaking for the first time from the Front Bench. He has my sympathy since his first speech is on fishing. I assure the noble Lord that things will get better. I am extremely grateful for the support that he provided.

The noble Lord asked how many of the decommissioned boats are in museums. I understand that there were three last year. It is for owners of museums to make the necessary arrangements.

On the important regional question--the impact of decommissioning on vulnerable ports--my honourable friend the Parliamentary Secretary, Mr. Elliot Morley, has had a series of meetings with representatives of some of the ports that have been badly affected. We have considerable sympathy with those who are suffering as a result of the problem. However, if we consider the way in which the decommissioning scheme has been structured there is little control over where the bids come from and whether they come disproportionately from England or from any particular port. There is a socio-economic impact on those ports. At this stage all we can say is that we recognise that fact and are giving some thought as to whether there is any way in which the problem can be mitigated. I repeat that we have great sympathy with those who are suffering the impact of decommissioning.

I turn now to the points made by the noble Lord, Lord Mackay. I welcome him on the same side as the noble Lord, Lord Pearson of Rannoch, although obviously not agreeing with him. Turning first to the question of nephrops, this round of the scheme is designed to focus on those segments of the fleet which have not met their targets under MAGP III; since the nephrops segment overshot it target Ministers did not want to see that

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segment of the fleet run down further and were not able to justify the public expenditure that would have been involved in decommissioning capacity which would not contribute to our meeting the MAGP III targets.

The noble Lord asked about the separate disposal of the track record. We decided to detach track record from licences after requests from the industry and after full consultation, which showed strong support for greater flexibility in the use of track records. Moreover, as there is a financial value associated with track records, and mindful of the need to try to reduce the level of bids so that the taxpayer will receive better value for money from decommissioning, we decided to take account of that on a pilot basis to see whether it would have any effect on the value of the bids.

On quota-hopping, we are not able to discriminate on grounds of the nationality of the owner. As previously, the scheme is confined to fishing vessels registered and licensed in the UK. That will continue to apply. If quota-hoppers are decommissioned, that will contribute to our targets and increase the quota available to the rest of the fleet. It is clear that the Amsterdam deal will not get rid of all quota-hoppers. It is now open for the Government to lay down requirements to ensure that real economic links exist between the UK fishing fleet and our coastal communities which are dependent upon fisheries-related industries.

Treaty changes were never a realistic option. There was no support for them from any other member state. We have clear guidance from the Commission on measures that we can take to ensure that fishing vessels have genuine economic links with the UK and will continue to work up a package of measures based on that guidance and in consultation with the industry.

The noble Lord also asked about MAGP IV. The Commission has now formally consulted the member states through the Management Committee procedure and will proceed to approve the resulting proposals in the next few weeks. Rates of reduction vary considerably according to vessel type (segment) and stock fished. The calculations also differ according to the means of implementation. The calculations are made either by reducing capacity (decommissioning) or introducing limits on time spent at sea (effort control). It is therefore not possible to give a single figure for the whole fleet in terms of either capacity or effort. The highest weighted reductions, which apply to the pelagic segment, will be about 20 per cent. over the next four years, while vessels under 10 metres in length may face no reduction at all.

I refuse to be drawn on the comparison with the set-aside. No one likes the principle of set-aside in farming. So why repeat it in fishing?

I know that the noble Lord is concerned about the question of square mesh. I am sure he knows this, but it is as well to repeat that as from 1st January 2000 a 70mm square mesh panel will be required in nets in the range of 32mm to 54mm; an 80mm panel will be required in nets in the range of 70mm to 79mm. This is the first time that EC legislation has required such panels on a mandatory basis. Any other net may

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incorporate a square mesh panel of at least 80mm. The so-called Baltic panels, at the side of the net rather than on the top, can be used in any net of at least 100mm.

Finally, I believe the noble Lord made a point with regard to panels not being mandatory in all nets. It is true that we too were disappointed that it did not prove possible to secure the Community's agreement to the mandatory inclusion of panels in all nets. However, there is a requirement in the regulation for the Commission to give priority in the next three years to funding research projects concerned with the use of square mesh panels or other selective devices. The Council will then be better placed to make informed decisions about further improvements to selectivity in nets at a later stage. That is very welcome.

Drift nets on the Northumbrian coast are outside the terms of the scheme but I shall be pleased to write to the noble Lord with regard to that matter.

As I said, today's debate is about setting the record straight and going into MAGP IV committed to meeting our obligations and serving the best interests of the industry. Much work remains to be done, and there will no doubt be many opportunities for debate. Within the limited terms of the 1997 scheme, and without prejudice to the continuing consultation with the industry on the implementation of MAGP IV, I trust that I may count on the support of the House in approving the scheme.

On Question, Motion agreed to.

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