Speech to the New Zealand Federation of Commercial Fishermen

 Good morning and thank you for having me.

In today’s environment I can’t think of a more appropriate theme for your conference than the one you’ve chosen. “Positivity” is something we’re all going to need.

 It’s something the Canterbury community has shown in buckets. Who would’ve thought that on top of the usual business challenges and financial pressures, your members and their supporters down south would be facing the physical destruction of premises, port and lives? 

Their response has been amazing.  Look at Independent Fisheries, for example. 1000 tonnes of liquefaction to clear – they not only shifted it - in less than 2 weeks they were up and running again.   Most of the stock was saved from damaged freezers by shipping it off to waiting customers overseas.  The company is now looking to upgrade its premises.

This is the sort of spirit and resilience your members will need. A mood of positivity will be very important - and the Government is ready, willing and able to play its part.  

Opportunities and challenges in inshore fisheries

It’s reassuring to see that at the same time as we’re exiting the recession and coping with the after-effects of earthquakes, export prices for seafood are strong.  Rising international prices are generally more than offsetting the impact of a high New Zealand dollar, driving investment into higher value products.

The total value of seafood exports for the year ended March 2011 increased by a very pleasing 11.4 per cent to $1.52 billion. Inshore shellfish did even better – a 17.2 per cent increase to over $281 million.  Great news!

However, this is no time to relax – and I’m sure you’re not. There’s definitely room for the inshore industry to grow and develop, but it’s going to take effort and commitment to get there.

The biggest opportunities in inshore fisheries are likely to be increased efficiencies in catching and processing, and adding value to our fisheries products - rather than in increasing catches.

There is only a small amount of room for that, and investment is needed. The big challenge is to create more value from the same amount of fish.

Managing for higher yields requires better information than is currently available for most inshore fisheries.  I recognise that information costs money, and industry is foots the bill, so we have to take care here.

It’s important that fishers, government and research institutes work together. Good information is as important to your day-to-day operations as it is to fisheries management decisions.

For our part, the Government will continue to focus on making sure the QMS is as robust as it can be in inshore fisheries. Then it can be used to support more recognition of the value of the New Zealand seafood industry and its products in international and domestic markets. 

The world wants – and is increasingly insisting on – sustainably fished and independently verified seafood.

We’re in an excellent position to take advantage with bold marketing, good international trade policies and representation, and MSC certification of key fisheries.

There are many good examples of this in inshore fisheries around the country. Companies are being successful because they are seeing and responding to changing consumer demands. They are also utilising sustainable fishing branding.

The recognition that the QMS continues to receive internationally helps a lot with international market perception of a very well managed, sustainable fishery. 

We can offer big points of difference with our fisheries management system. Your industry can take a lot of the credit for this.

If you’re going to fully capitalise on your competitive advantage – and I hope you will – we need to nurture the brand.

In many of our inshore fisheries, there are some challenging issues that I’m sure you’re aware of.

Discards and protected species interactions are two areas that affect the way New Zealand is seen in the market and where there is a focus on improving monitoring and management. 

While these are never easy things to address cost effectively, it’s good to see these topics are getting a thorough airing at this conference. 

I look forward to hearing more about the good work the industry and the Ministry are doing to resolve the issues. They are crucially important.

Progress on priorities

Last year Wayne McNee gave you a run-down on Fisheries 2030. 

In its five-year plan to 2014, Fisheries 2030 clearly identifies priority areas that we’ll be focusing on.

Short-term priorities include aquaculture development; implementation of national fisheries plans; implementation of the Observer Services Strategy to increase the efficiency of delivery in conjunction with industry, and less red tape for industry; and completion of the Review of Discards, which has the aim of improving the reporting and management of discards in our commercial fisheries.

Medium-term priorities include; increasing the Ministry’s ability to work effectively and efficiently with industry - for example, implementing the latest Memorandum of Understanding with the Deepwater Group; and the creation of the Inshore Fisheries Industry Council.

Also, promoting both government and business-led science and innovation in the sector through the Primary Growth Partnership initiative in order to unlock future opportunities.

The Ministry has in place a programme of reviews. In recent years it has reviewed both Observer Services and Research Services.

Future years will see independent audits of the implementation of the reviews undertaken to date to make sure the intended benefits have been realised, as well as continuation of the programme to cover the Ministry’s compliance functions.

Research services

The Ministry is in the process of revising its approach to the way it procures research through a move to longer-term contracts.

An international tender has been put out to support the implementation of the 10-year research programme for deepwater fisheries.

The longer timeframe for these contracts provides means you can  partner better.

The Ministry has also commissioned a report about direct purchasing of research by industry. The report is now on the Ministry’s website, with feedback invited by the end of this month .

The Ministry is also releasing a Research and Science Information Standard, which I’m sure will make a significant contribution towards ensuring high-quality information continues to be used as the basis for fisheries management decisions.

Observer Services

The Observer Services Strategy Review project has evolved considerably since its re-scoping in 2010.

The project was a collaborative review involving industry, the Ministry, the Department of Conservation, and environmental non-government organisations.

Four areas were set up to the review project cost-efficiency, process improvement, a standards manual and future models of service delivery.

These areas have been completed and good progress is being made. I’m confident there will be opportunities to reduce fishing industry costs, improve efficiency of the Ministry’s service delivery, for government to further assist the economic development of the fishing industry, and to improve the effectiveness of observers’ contribution to fisheries management.

As you know, the cost of providing the programme is fully cost recovered from the fishing industry, either via levies (about 85 percent) or transaction fees (15 percent).  Estimated costs and the number of sea days to be delivered are set in the Observer Services Programme budget annually.  Quota holders are levied for their share of the estimated cost for the full-year plan.

So we have to make sure we are getting value for money.

Organisation

You will have seen the Government’s announcement in March that the Ministry of Fisheries will merge with the Ministry of Agriculture and Forestry.

On the first of July the two organisations will merge to form a single Ministry.  While the final shape of the combined organisation will take longer to reach, the new Ministry will have an exciting set of challenges ahead of it.

I’m confident that the ability to deliver high-quality, focused services to the primary production sector will be significantly enhanced by this merger.

The organisational strategy for the future Ministry will build on elements from both organisations.  While they will become one from the first of July, they will keep operating under current names and brands for the time being. 

I have signalled to my Cabinet colleagues, and they acknowledge the fact that the fisheries sector is unique and requires unique attention. The new Ministry will need to be conscious of that. For example while diary farming is about ‘privately owned cows’ being farmed on ‘privately owned land’, fishing involves ‘public fish’ harvested in a ‘public space’ commonly known as the ocean.

As a consequence, the recreational and environmental group interest is fishing deserves particular and high level attention in fisheries management, more so than in farming, forestry or horticulture.

The next few years promise to be a challenging time for the organisation, as it looks to support achievement of the Government’s agenda of export-led economic growth, reduction of the regulatory burden, and making sure focus is maintained on the food and biosecurity systems – all during a time of fiscal constraint.

I’m confident that the merger will reduce duplication and operational costs. 

The merger is expected to provide benefits to the commercial fishing industry.  I anticipate that a proportion of the savings from the merger will be shared with the sectors and industries the new Ministry works with, effectively reducing the cost to those who do business with it.

The merger is expected to deliver annual savings of $10 million a year from 2012/13, shared between government and the industries MFish and MAF work with. The detail of the final process for achieving this is currently being developed.

 Importantly, the organisational strategy for the new Ministry will incorporate the thinking in Fisheries 2030. The Government’s priorities for fisheries are likely to remain largely unchanged, although refined delivery mechanisms are likely in some areas.

The merger is an exciting development and I look forward to working with all of you to help make sure it works for you.

Regulation

 I talked to you a couple of years ago about what we were going to do to regulations. There’s nothing like keeping your promises in election year.

We were aiming to make the regulatory framework more streamlined, user-friendly and easy to understand.

We were looking to achieve an appropriate balance between less red tape, cost savings – imposing less on you and allowing you to focus fully on improved productivity and growth – and sustainable management of our fisheries.

Last month Rodney Hide and I announced the removal of a total of 176 unnecessary regulations from the books.  So it’s out with the 1995-96 Jack Mackerel Quota and the Fisheries (Transitional Provisions) Regulations (No 2) 2001.. Now we’re working on a Regulatory Reform Bill and consolidating regulations, including some of the ones that apply to you.

Since your last meeting we’ve seen catch limit changes for stargazer, rubyfish, scallops, rock lobster and a number of deepwater stocks.

As well as this, bladder kelp and Patagonian toothfish were brought into the QMS and I made my decisions on butterfish set netting.

I always take a cautious approach and will increase catch limits only when I’m confident this will be sustainable.  If the science says a reduction is needed to protect sustainability, that’s what I’ll do.

Dolphin decision

As you know, in March I announced my decisions from the review of two areas to set net fishing.  The Hector’s and Maui’s dolphin debate had been running since 2003, so hopefully you agree that in the name of certainty it was good to bring the curtain down.

To recap, the review covered restrictions on fishing designed to manage the threats posed to West Coast North Island Maui’s and East Coast South Island Hector’s dolphins.

The review followed a High Court ruling last year that two restrictions implemented in 2008 to protect dolphins were to be reconsidered. 

The restrictions were the extension of set net closures on the WCNI from four nautical miles to seven nautical miles from the shore and the closure of an area of the ECSI to targeted commercial fishing for butterfish.

The restrictions were part of a package of area closures and fishing method restrictions implemented as part of the Hector’s and Maui’s Dolphin Threat Management Plan developed by the Ministry of Fisheries and the Department of Conservation in 2008.   

I decided to retain the prohibition on commercial fishing using set nets in the area between four and seven nautical miles from the shore on the WCNI, and to provide an exemption to the set net prohibition on the ECSI to allow commercial fishers targeting butterfish to use set nets in a defined area.

My reasons for these decisions were that with the Maui’s dolphin population being only about 111, very low levels of mortality can have a significant impact. I considered that although the risk of mortality from fishing in the four to seven nautical mile area is low, it is not acceptable.

On the other hand, I thought that given the type of fishing gear you use, the size of the area and the numbers of Hector’s dolphins, there is an acceptable level of risk in terms of mortality from butterfish fishing by commercial fishers on the ECSI.

I also directed the Ministry to advise me whether an exemption may be warranted for recreational set net fishers targeting butterfish in the same defined area of the ECSI where I granted the commercial exemption. The Ministry will release a consultation document on that in late May or early June and I expect to make my decision around August.  

Foreign Charter Vessels

In February we saw the presentation of a petition to Parliament relating to companies’ use of foreign charter vessels. Since then there’s been a lot of media coverage, some items possibly being better informed and up to date than others.

The Federation’s stance on the use of FCV’s is well known - and I respect it.  I assure you there will be no introduction of FCV’s into the 12 mile area.  However, it is an extremely complex issue with many angles to consider.  The fact that three government agencies – the Ministry of Fisheries, the Department of Labour and Maritime New Zealand - are all engaged in this area, illustrates the complexity.

I’m confident that the Ministry of Fisheries is carrying out its role efficiently, effectively and appropriately.  In a nutshell, that role is to protect the integrity of the fisheries management regime by operating a rigorous registration and application process, and making sure observers work in a safe environment.

Please be assured that the Government is listening - and I look forward to seeing the outcome of the parliamentary petition process.  I’m sure you’ll agree that what we’re all looking for is what’s best for New Zealand and best for economic growth, including employment prospects. 

Aquaculture

I’m very pleased to report that good progress has been made on the aquaculture development package of legislative and other reforms designed to reduce costs, delays and uncertainty, promote investment and enable integrated decision making.

The central feature of the reforms, the Aquaculture Legislation Amendment Bill (No 3), was recently reported back to the House by the Primary Production Committee.  Completion of the legislative process is now in sight.

Like many other organisations, the Federation provided a submission to the committee on issues of particular interest to the fishing industry. Your contribution to this process is important and appreciated.

The Government is also on the look-out for additional ways to support aquaculture development.  For example, late last year I asked a Ministerial Advisory Panel to examine the potential to create a 300-hectare marine farming zone in the Coromandel.

The Panel carried out a public consultation process and reviewed scientific and economic information.  It has presented me with its findings and I’m now considering those.

I will announce my decision on whether to proceed with the proposal – and if so, how – in the near future.

The Aquaculture Unit within the Ministry of Fisheries is busy building co-ordination between the groups involved in aquaculture, and talking with stakeholders to inform development of a national aquaculture strategy and action plan that includes both marine and land-based aquaculture.

This plan will identify how central government will work with stakeholders to develop aquaculture.  It will cover projects to develop new space and species, and will also look into research and innovation, market development and iwi participation.

All very exciting stuff with enormous potential. Watch this space.

Conclusion

Coming back to the theme of your conference, Positivity can mean a couple of things.  Simply “being positive” – very important in these changing times.  Also, “characterised by or developing certainty, acceptance or affirmation”.

As you know, the business climate isn’t certain – and unexpected things like the quakes have come along to challenge us further.

Working together, we need to grasp every opportunity we’re offered to add value and build our businesses and our economy for the secure and sustainable future we’re all looking for.

I wish you well for your conference and AGM.