|
New
Zealand shows the world the way to efficient fisheries
management
Introduction
| Realigning incentives |
Building on success | Recreational
fishing
Quota allocation | The
legal basis | Restructuring
the system | Pattern for the future
New
Zealand is showing the world the way to efficient fisheries
management. It has broken away from the tradition of
control by regulation, and adopted a new approach based
on property rights and economic incentives.
The
new system gives the fishermen a right to take a defined
quota, or share of the total allowable catch. This quota
is the holder's legal property in the full sense of
the word, being both transferable and divisible.
It
is interesting to note that the consistent refusal of
administrators to admit that a fishing licence confers
property rights on the holder is a major stumbling block
to the reform of a cumbersome, inefficient and increasingly
costly management system in Australia.
New
Zealand's quota management system has so far been partially
adopted. Now, having proved outstandingly successful
during five years of application to 32 of the nation's
most important species, an expert report has recommended
its immediate and universal adoption in both commercial
and recreational fields.
The
report, prepared for the Minister of Fisheries by Peter
H. Pearce C.M., lists four principal conclusions:
| 1 |
the
quota system is a better way of managing fisheries
and should be retained; |
| 2 |
a
number of changes are needed to make it work better; |
| 3 |
those
who hold rights to fisheries should be given increasing
responsibility for managing them; and |
| 4 |
environmental
issues are not being sufficiently well handled at
present. |
 |
|
Realigning
incentives
Pearce found enthusiastic approval for the new quota
management system in all sectors of the community -
commercial and recreational fishermen, government officials,
Maori and conservationists alike.
This
public reaction, he believes, amounts to "an endorsement
of the idea that a system based on property rights,
and the economic incentives that accompany them, can
be an effective alternative to increasing government
regulation."
He
reports that the quota system has improved management
of stocks, reduced redundant fishing capacity, alleviated
conflicts over the allocation of catches, and increased
the economic returns from fishing to both the industry
and the government.
The
new system, he adds, "eliminates the single-minded competition
for fish and wasteful over-investment in fishing capacity."
"It
provides users with well-defined, securely vested and
valuable interests in the catch, giving them strong
incentives to develop efficient fishing enterprises
and to support good, long-term resource management."
"The
benefits of the quota system derive from this realignment
of fishers' incentives."
Building
on success
He points out, however, that the successes achieved
so far must be built on, and for this a number of substantial
changes are needed, both to the quota system itself
and to the antiquated regulatory framework within which
it is still embedded.
Most
importantly, greater responsibility for managing fisheries
must be given to those who hold the rights of access
to the resources.
The
most immediate problem is that some 130 species, for
which commercial permits are issued, still remain outside
the quota management system, and recreational fishing
is not covered. Both these deficiencies, he says, must
be remedied without delay.
He
points out that the alternative - dealing with them
sequentially over a period of time - would give rise
to a number of avoidable problems.
"The
sooner the quota management system is extended to cover
all species the better," his report recommends. "This
view is widely shared within the fishing community."
Recreational
fishing
The most immediate problem which must be faced is that
of making allowance for recreational fishing.
Something
like a third of New Zealand's people go fishing now
and then, mainly for snapper, kahawai and rock lobster,
and in these species amateur anglers compete with commercial
fishermen.
While
bringing recreational fishing under the quota system
is strongly supported by commercial fishermen and fisheries
administrators, it is generally opposed by amateur anglers,
who claim a traditional freedom to fish without charge
or restriction.
Pearce
points out, however, that they have a lot to gain from
the quota system.
"The
absence of specific rights, and any form of licensing,
leaves a dearth of information about the numbers or
recreational fishermen and their catches of fish," he
says.
"This
is essential information recreational fishing groups
need to promote their interests, and resource managers
need to manage recreational fisheries."
He
adds: "Commercial fishermen's quotas give them a stronger
legal claim on the catch which is likely to leave recreational
fishermen in a weak position as their demands grow.
"Moreover,
recreational fishermen are left with no means of increasing
or adjusting their share of the catch."
"Recreational
fishing is vulnerable to the charge that only commercial
fishermen contribute to the cost of fisheries management."
The
solution he recommends is to allocate a proportion of
the catch as recreational quota, to be held on behalf
of amateur anglers by central or local government or,
preferably, by new organisations, based on Fish and
Game Councils, created for the purpose.
Such
bodies would be best able to advance the interests of
recreational fishermen, and monitor catches by means
of periodic surveys.
Quota
allocation
The permanent quota rights already issued to commercial
fishermen present problems of allocation, the report
says.
Quotas
for species not yet under the system, but already being
fished, should be allocated on the basis of catch histories,
while those for species not currently being fished should
be auctioned.
The
report stresses the point that the principle of allocating
quota rights on perpetual terms, which has been done
in most cases, should be adhered to.
This is because long-term investment decisions cannot
be made on the basis of short-term access to resources.
Moreover, limited terms not only reduce the security
and value of fishing rights, but also reduce the incentive
to conserve and enhance fish stocks.
Quotas
should also be in terms of a proportion of the total
allowable catch.
The
original system of allocation of quotas in tonnes collapsed
in 1989, when it was realised that orange roughy stocks
had been grossly overestimated, and the Government found
itself financially incapable of buying back quotas.
The
problem was solved by changing all quotas to percentages
of the total allowable catch, making it unnecessary
for the Government to intervene at all in the quota
market, either as buyer or seller.
The
percentage system, Pearce admits, has two main disadvantages.
It makes the value of the quota less certain, and therefore
less secure as a property right; and it puts the responsibility
of setting the total allowable catch on the Government
while the quota holders either bear the cost or reap
the profits which result from the adjustment.
But
long-term benefits outweigh these short-term disadvantages.
"On
the other hand," he points out, "percentage quota can
advance the policy objective of engaging those who hold
fishing rights in the responsibilities of resource management."
"By
assigning quota holders defined shares, not only in
the current catch but also in all potential yields,
percentage quota gives them strong incentives to support
good management, research and enhancement."
The
legal basis
As things stand at present, there are still problems
confronting fishermen seeking to use quota rights as
collateral for loans.
This
deficiency, Pearce believes, can be addressed by developing
the property rights approach to fisheries management.
A
legal register of property rights and interests, like
that for registering interests in land, would provide
for the registering of mortgages, and would be completely
acceptable to financial interests.
The
report rejects the concept of Crown charges for fishing
rights, like the so-called "resource rent" which is
advocated in some quarters. This sort of tax has proved
to be impractical, and does not bring in the revenue
expected of it.
"Notwithstanding
legal niceties," Pearce points out, "the quota management
system has effectively transferred property interests
in fisheries from the Crown to quota-holders, thus weakening
the Crown's claim for a return to the owner.
"In
my opinion," he adds, "the guiding principle in distributing
the burden of government charges should be cost recovery."
"That
is, the required revenue should be raised through charges
on holders of fishing rights, distributed among them
in a way which corresponds, as closely as possible,
to the costs they impose on the Treasury."
Restructuring
the system
The report points out that the new quota system has
been imposed on mechanisms designed for managing fisheries
under the former, highly regulatory system. Some of
these mechanisms are no longer necessary; others are
not well suited to today's needs.
A
wide ranging legislative and administrative overhaul
is needed. This would involve the 1983 Fisheries Act,
the 1971 Marine Farming Act, the 1989 Maori Fisheries
Act, the 1977 Territorial Sea and Exclusive Economic
Zone Act and what Pearce describes as a "panoply of
regulatory instruments".
The
primary purpose of management mechanisms, the report
points out, is to prevent depletion of fish stocks,
which is achieved by setting a total allowable catch
and allocating proportional quotas. They are therefore
no longer necessary.
"I
find the present provisions for fisheries management
plans anachronistic and inappropriate," Pearce says,
"and I conclude that they should be abolished in favour
of a more suitable process for establishing the parameters
within which those with rights to fish may manage and
use resources."
Fishing
permits, he says, "serve no obvious purpose" and should
be abolished, and "the necessity of controlled licences
is also questionable".
Pattern
for the future
The new approach, he says, involves separating the responsibility
for managing fishing, which can be assigned to those
who hold the rights to fish, from that of protecting
the conservation of resources, which is the responsibility
of government.
Quota
holders must therefore be given legal authority to organise
themselves for the larger role they must play.
Fisheries
associations, covering recreational as well as commercial
fishermen and controlled by quota holders "much like
shareholders", should be the "vehicles for management"
in future.
Says
Pearce: "They would design fishing regimes for the benefit
of their members, alleviate resource management problems
such as local depletion, comply with conservation prescriptions
about by-catches and related matters … and sponsor research
to establish yield capacity."
At
the national level, overseeing these regionally-based
or resource-based fisheries associations, would be "a
fisheries board … to bring all New Zealand's fisheries
interests together."
Whether
the recommendations of the Pearce report will be followed
in detail is, of course, a matter for the future. But
a new system has been introduced which has already proved
far superior to the old, and it is obvious that there
can be no turning back.
As
Minister of Fisheries Douglas Kidd put it, "In spite
of its admitted shortcomings, the quota management system
is working, and the establishment of tradeable property
rights to harvest fish has had positive consequences."
New
Zealand has obviously made a significant breakthrough,
and countries with traditional management systems, which
are failing to maintain healthy stocks or sustain prosperous
fishing industries, are watching closely.
The
world-wide pattern is one of depressed resources, over-expanded
fishing fleets, low incomes for fishermen, heavy dependence
on government regulation and support and conflicts between
fishing interests.
Ultimately,
all the world will have to follow the lead.
|
