Comments on Proposals for Reform of Fisheries Management

Comments on Proposals for Reform of Fisheries Management.

Three overarching comments before considering any detail.

The move towards devolution of registry services to industry control and a contestable environment is a step towards improving efficiency if, and only if, the objectives of the registry services, and the balancing regime in particular, are achievable. The balancing regime in the current 1996 legislation is not workable, and unless fundamental changes are made, will cause the collapse of the QMS.
Significant savings are possible only if there is a fundamental shift in approach, and the responsibility for getting all returns (LFRRs, QMR, CELRs, CERs, and any others) into machine readable format, with suitable electronic signature for verification and non-repudiation, is placed on the suppliers of that information. Any attempt to do this in piece-meal fashion will not provide any cost savings, and will in fact increase costs.
Any Standards and Specifications developed must be at the very highest level, perhaps with requirements for type approval of any proposed real implementation.

As much as industry wants the chance to bring significant improvements in efficiency, and reductions in costs, accepting responsibility for registry services under the current 1996 Fisheries Act is suicidal. The balancing regime in the 1996 Act cannot ever be implemented in practice without causing the complete collapse of the QMS. Those who are cynical in industry are suspicious that this is a deliberate ploy by certain individuals to discredit the concept of "Industry Self Management", and to force the retention of a large ministry to handle all registry services. I do not personally subscribe to this model (though it does have some strong evidence), and lean more towards it simply being the result of failure to attain agreement on fundamental principles, compounded by failure of policy development to consider the real implications of cherished theories on real fishers and real fisheries.

The whole 1996 Act select committee process got bogged down in detail and, once beyond "sustainability", lost sight of principles. We must focus and agree upon principles - NOW.

Everyone agrees on the principle of sustainability. Beyond that it is clear from the Minister's 8 December 1997 response to my letter of concern that no agreement exists. (See paper "Principles for ACE Balancing".)

The ACE system held the promise of simplification if developed as a retrospective balancing mechanism to simplify the administration of flexibility required by industry (the 20% carry forward right). Instead theorists ignorant of fishing practice and practicality, and a process out of control, turned it into a real time balancing regime with no flexibility (unworkable in practice, and every bit as administratively complex as the 1983/86 system).

Any thought of progressing the "Reform of Fisheries Management" without completely revisiting the principles of the "ACE Balancing Regime" is doomed to failure. Not a failure of the process, or because the outcome is undesired, but simply because the outcome as currently defined is not achievable in practice.

The foreword and introduction are laudable in principle, if only the reality matched.

Up until Page 8 I completely agree with the statements and sentiments - right up until:

"Our current regime has the potential to:

effectively protect the aquatic environment;

achieve sustainable utilisation of fishstocks; and

allow the Crown to deliver on its Treaty of Waitangi obligations and meet its international obligations."

I wish it were so but am personally 100% convinced that the balancing regime contained in the 1996 Act is unworkable in practice, and will collapse the QMS if implemented in it's current form. Thus the statement above is valid as it applies to the 1983/86 legislation and it's subsequent amendments, but does not apply to the 1996 legislation - at least in so far as the balancing regime is concerned.

At the bottom of page 8 the following section occurs

"Looking to the future, the situation is likely to worsen unless the evolutionary process of change, that commenced in 1986, is continued. The Fisheries Act 1996 will result in increased costs for both the government and the fishing industry - both now and in the future. This increase in costs is necessary to achieve sustainable utilisation. Increased costs are being faced now as a result of the setting up and delivery of the new systems required by the Act.

In the future higher costs will result from the higher environmental standards and the greater requirements for consultation with stakeholders imposed by the Act."

I agree that some aspects of the evolutionary change of the 1996 legislation are a major advance, and agree with the sentiment that the evolution needs to continue, but unfortunately it is far worse than that. The whole balancing regime of the 1996 Act will not work (I have been saying that consistently since 1983, and very clearly since 1991) - at least in so far as the principles employed in the regime are concerned.

My major disagreement on detail appear on page 15:

"Listed below are the core government required services that would not be available for independent purchase or provision:

collecting sensitive primary research data;"

If the definition of "primary research data" includes the processing of CELRs, CERs, and various other standard statistical data currently supplied, then I disagree. The data is no more sensitive in any way than the LFRR and QMR returns provided now. The cost of transcription to electronic format, and the error rate in the transcription process is a major barrier to the effective use of that information now. Putting the responsibility for the transcription onto the suppliers in the first instance has many potential advantages in terms of data integrity and cost reduction to industry.

Government is welcome to retain ownership and management of the resulting databases, but not necessarily of the process of rendering the information into electronic form. Enforcement officers could still do spot checks to ensure electronic and paper records match at source, no different from now. This is the major area where industry can reduce its costs in the short term. I can see absolutely no justification for calling this a core service, unless all the registry services are similarly labelled, and we are back to status quo.

Appendix 3 - Providing the Capacity for Quota Owners to Deliver Registry Services - provides one possible model for development.

If the Ministry sets sufficiently high level standards, then the model used by industry should be irrelevant, provided it achieves the desired outcomes, and is suitably auditable.

Summary.

As an evolutionary direction this is highly commendable.

As the basis for immediate action it is impossible, but then that is the purpose of consultation, to identify and rectify inconsistencies.

If the Balancing Regime in the 1996 Act is made workable in the very short term, then further evolution of this concept is highly desirable, otherwise, it is a disaster to be prevented at all costs.

These are my recommendations as an FIA Councillor to the council, and as a Federation member to the executive of the NZFCF.

Ted Howard

Managing Director - Solution-Multipliers Ltd - 28 Jan 1998