Reform program for NSW commercial fishing
Quick reform program update
- The Structural Adjustment Review Committee (SARC) last meet in January - see Chair’s Summary [PDF 232 KB]. The next meeting is scheduled for February 2014.
- The vast majority of the second share linkage working group meetings have now been held. Constructive and robust discussions took place and based on the advice from the working groups DPI is undertaking further modelling of options and ITCALs ready for consultation with all shareholders in early 2014. Opportunities for input before the final decision on linkage is made by the Minister are still available and all stakeholders are encouraged to make use of these. See here for dates of upcoming share linkage working group meetings.
- The timeline for the reform process is currently being revised. A fresh timeline will be published shortly.
- A policy and procedures for Observers to attend working group meetings has been established.
- GHD Pty Ltd has provided a draft copy of the cooperatives study which was sent to all cooperative managers for review and discussion at the recent cooperative association’s meeting.
- Ministerial Fisheries Advisory Council - Expressions of interest for the five core members has closed. The Minister is currently considering the expressions of interest and the successful and non-successful applicants will be notified once the relevant appointments have been approved by cabinet.
- The tender for consultation services has closed and the evaluation of tenders received is in progress. The tender documentation (RFT ID – DTIRIS13/32) can be found at https://tenders.nsw.gov.au
- Invoices have been sent to shareholders for the new 2013/14 fees based on shareholdings as at 1 November 2013. Due date for payment is 31 May 2014.
Commercial fisheries reform program
In May 2012, the Government released the Independent Report of Commercial Fisheries Policy, Management and Administration containing 22 key recommendations for change. The Government gave careful consideration to the recommendations and now all 22 key recommendations for change are being broadly adopted.
The reform program seeks to provide improved meaning and value in shares, improved flexibility for shareholders to tailor their access and management costs, improve the overall viability of the NSW commercial fishing industry and to improve investment confidence and support from financial institutions. It should also help to secure greater community acceptance and support for NSW commercial fisheries and commercial fishers in the long run.
The future scheme will enable shareholders to upscale or downscale if they choose, focussing their fishing activities on the preferred species or fisheries and (within sustainability limits) at the levels they consider appropriate for their individual needs. For further information and the Government’s response see the links below;
- Government’s response to the Independent Review recommendations [PDF 157 KB]
- Commercial fisheries reform program documents, data and links
- Independent Review of Commercial Fisheries Policy, Management and Administration
Linking shares to resource access
A key part of the reform program is to link shares to resource access (or a set “piece of the pie”). Once that happens, even though the size of the pie might change over time due to the stock abundance, a share of the pie stays the same. This means that new fishing effort or competition cannot enter the fishery at any time and undermine access to the resource. The objective is that shareholders will end up with stronger and better defined rights.
Three typical examples of share linkage are:
- each share gives the shareholder a portion of a total catch level that is set - e.g. 1 share = x kg of catch);
- each share gives the shareholder a portion of a total effort level that is set - e.g. 1 share = x amount of gear, or 1 share = x fishing days;
- minimum shareholdings can be used to limit the number of endorsements that are available - (if neither approach above leads to a workable outcome).
DPI is undertaking comprehensive consultation with industry to explore different share linkage options. Share linkage working groups were appointed in May 2013 and the first round of meetings were conducted in June and July. The share linkage working groups are independently chaired and include representatives from industry and DPI. The short listed share linkage options identified by the share linkage working groups for most fisheries, have been modelled and presented back to the working groups in the second round of meetings held recently. Constructive and robust discussions took place and based on the advice from the working groups DPI is undertaking further modelling of options and ITCALs. A discussion paper with the share linkage options will be sent to all shareholders early this year for consideration and comment. The industry feedback and DPI’s views will be provided to the independent Structural Adjustment Review Committee (SARC). The SARC will make the final recommendations to Government on share linkage.
Once the form of share linkage and the total catch or effort levels have been decided, fishers will be better placed to make an informed decision about their future in the industry or particular fisheries. Fishers will be able to decide if they wish to exit by submitting a tender to the $15.5 million exit grant program and/or downsize, increase or maintain their current shareholding in preparation for the linking of shares to catch or effort.
The exit grant process will be administered by the NSW Rural Assistance Authority. Tender bids will not be capped and bids deemed ‘value for money’ will be offered an ex-gratia payment for either the surrender of shares to Government or transfer of shares within the industry. Keep an eye out for future newsletters that go into more detail about how the exit grant scheme will work.
2013/14 share management charges
The new charge structure is transitional and applies to the 2013/14 fiscal year and has moved from the previous per fishery structure to a per share structure, so that an individual’s management costs are more directly related to their level of resource access.
A formal cost recovery policy will be developed in consultation with the new Ministerial Fisheries Advisory Council (MFAC) and the fishing industry to determine the future payment structure and approach. The industry has been heavily subsidised in the past and the government has been forecasting for many years that cost recovery is coming. There are too many fishers in the industry, many who are only active when catches or prices are high. This reduces profitability of full-time fishers. The fee increase will most likely encourage inactive fishers to leave the industry and thereby improve the viability of those who choose to remain.
The share management charges for the 2013/14 [PDF 42KB] fiscal year have been determined. A notice was mailed to all shareholders in August 2013 and invoices have been finalised and forwarded.
The key features are:
- a 40% discount factor will apply to each share class held in a fishing business over and above the first two share classes;
- 1 November 2013 will be the date used to calculate the total charges payable by each individual fishing business – shareholders can choose to adjust their shareholdings before then if they wish to change their fee liability;
- all share transfer fees relating to transactions between 1 June 2013 and the end of the exit grant process will be waived; and
- a single due date of 31 May 2014 will apply for the payment of the 2013/14 charges.
Structural Adjustment Review Committee (SARC)
The Structural Adjustment Review Committee is an independent committee formed to oversee the structural adjustment component of the commercial fisheries reform process and provide recommendations to the government. The committee members include Mr Ian Cartwright as the independent chairperson, Ms Mary Lack as the independent fishery manager and Ms Sevaly Sen is the independent fishery economist.
- More information on the Structural Adjustment Review Committee.
NSW commercial fishing statement of intent
The Minister responsible for fisheries, the Hon. Katrina Hodgkinson has issued a Statement of Intent for NSW commercial fishing industry.
The Statement aims to improve industry confidence and build a strong, sustainable and economically viable commercial fishing industry.
The Statement is part of the Government's commitment to delivering the Commercial Fisheries Reform Program.
- NSW commercial fishing statement of intent [PDF 84KB]
Share trading notice board and current share holding information
A notice board and current share holding information is available and aims to facilitate the trading of shares and other items and create a more informed market. The notice board and share holding information is updated regularly.
Study relating NSW commercial fishing co-operatives
Following comments about the possible impacts of the reform program on the viability of fishing co-operatives, NSW DPI set up a working group of co-operative representatives and has funded an independent study that aims to fill some key information gaps and provide a better basis for an informed future policy discussion.
The well regarded consultancy firm, GHD Pty Ltd, has been commissioned to undertake the study. It has expertise and experience in this area having undertaken a similar study in 2008/09.
GHD Pty Ltd has provided a draft copy of the study which was sent to all co-operative managers for review and discussion at the recent co-operative association’s meeting.
- Exit Grant Information Flyer - 13 February 2014
- SARC Chair's Summary meeting
- Share Trading Notice Board
- Commercial Fisheries Reform Newsletter [PDF 250kB]
Useful reform documents
- Information sheet for financial institutions [PDF 45.9kB]
- Government’s response to the recommendations of the Independent Review [PDF 157kB]
- Common questions and answers [PDF 320kB]
- Media Release 14 November 2012- Reforms to provide long-term viability to NSW commercial fisheries[PDF 92kB]
- Independent Review of Commercial Fisheries Policy, Management and Administration