Quota Management: ‘Bricks and Mortar’ or ‘Smoke and Mirrors’

Posted in Industry News


In this article Eric Perez, QSIA CEO and I look at the supposed positives and the documented negatives of quota, a set of facts that the vast majority of us have never been made aware of by Fisheries Queensland (FQ).

Shane: When the idea of quota was first floated by FQ we, as an industry, were led to believe that it was going to be some magical ‘fishing right that we would own, that would be able to be used as an asset/collateral with lending institutions, something that would give us security and tenure. In my understanding of the fisheries legislation this couldn’t be further from the truth, but as I always maintain, you be the judge. All I can do is report what is in the legislation, the answers that I have received from FQ and what has transpired through our history with quota managed fisheries.

Eric: The benefits of quota have been significantly overplayed and have been sold to industry as a way to improve our asset base. Ironic that the introduction of quota will in some circumstances (those without enough historic catch) will be locked out of their fishery. I have no faith that the current fisheries management legislation can create anything but an access right.

1. Commercial Fisher Perspective – Shane Snow

Recently the Association posed questions about quota to FQ, now we can explore (through State and Federal Fisheries legislation) their answers that I received actually mean.

1.1. Statutory fishing rights (SFR) in Queensland

Industry concern – Does quota grant commercial fishers a fishing right?

FQ Response: ITQ or Individual Transferable Effort (often used in trawl fisheries) is a statutory fishing right (but not a property right) and provides the most security for access for commercial fisheries.

To understand the potential introduction of quota in Queensland the definition of an SFR under Commonwealth legislation is worth exploring. Fishing rights under the Fisheries Management Act 1991 have defined SFR as follows:

Section 21. Nature of a statutory fishing right

(1) For the purposes of this Act, each of the following rights is a separate statutory fishing right:

(a) a right to take a particular quantity of fish, or to take a particular quantity of fish of a particular species or type, from, or from a particular area in, a managed fishery;

(b) a right to a particular proportion of the fishing capacity that is permitted, by or under a plan of management, for, or for a part of, a managed fishery;

(c) a right to engage in fishing in a managed fishery at a particular time or times, on a particular number of days, during a particular number of weeks or months, or in accordance with any combination of the above, during a particular period or periods;

(d) a right to use a boat in a managed fishery for purposes stated in a plan of management;

(e) a right to use particular fishing equipment in a managed fishery;

(f) a right to use, in a managed fishery, fishing equipment that is of a particular kind, of a particular size or of a particular quantity or is a combination of any of the above;

(g) a right to use a particular type of boat in a managed fishery;

(h) a right to use a boat of a particular size or having a particular engine power, or of a particular size and having a particular engine power, in a managed fishery;

(i) any other right in respect of fishing in a managed fishery.

Now having a description of what a SFR actually is, to my understanding, is no more than a ‘vehicle’ to carry quota just like our primary fishing licenses. Put simply, quota is just a fancy name to make it appear like industry owns something of value.

Industry concern – Do commercial fishers own their quota?

FQ Response: Yes, the holder of the Individual Transferrable Quota (ITQ) unit is the owner.

Industry concern – Under what conditions can Fisheries Queensland rescind or suspend quota?

FQ Response: It would be for non-compliance purposes mostly.

The answer above clearly states that quota can be taken off us at any time by FQ for various reasons. I ask the following:

  • What is the ‘level’ of non-compliance required for FQ to be able to take quota from us?
  • Is it simply a matter of overdue log returns, having 1 or 10 kilograms of fish over our allocated quota or numerous breaches by FQ?

I believe that there has not been a set of guidelines specifically put in place for non-compliance so that it is open to the discretion of FQ, thus keeping us on edge throughout our fishing careers with the real threat of what we have, being taken away from us.

So, while we may own our quota at face value it can be stripped away from us by FQ at any time. This makes the decision to consider or even buy quota a very precarious one. Who wants to invest a considerable amount of money into a business that has the very real potential to virtually vanish overnight?

1.2. Ownership of Quota

Industry concern – Has quota been granted to the individual fisher in perpetuity?

FQ Response: ITQ in Queensland has been granted in perpetuity and based on catch-history.

FQ have us believing that we own quota for ever by saying that it has been granted “in perpetuity”. The definition of this wording is, It frequently occurs in the phrase “in perpetuity,” which essentially means forever. This is definitely not the case.

2. History of quota management in the Coral Trout and Spanner Crab fisheries – Shane Snow

Coral Trout quota was set at 1,350 tonnes in 2004 – 2012 and was then reduced to 1,088 tonnes from 2013 – 2014. Further reductions in quota occurred in 2015 – 2016 (917 tonnes). The quota for the recently completed quota season (2017–2018) increased to 963 tonnes and again to 1,163 tonnes for the current (2018-2019) quota season, (down approximately 14 % on the original quota) – Source: Queensland Fisheries Summary October 2018, page 27.

Now some 16 years later with considerable effort decreased in the coral trout fishery why are we still down on the original quota issued by nearly 200 tonnes if quota managed fisheries are so great? Industry has been “given back” some quota that was originally taken from us, are we as an industry, supposed to be forever grateful of getting back only a fraction of what was originally ours anyway?

On a point of interest, when coral trout quota came into being, I can never remember a 60% biomass target being even discussed. Why a 60% target when Commonwealth and World fisheries standards are between 20% and 40%. FQ have moved the goal posts even further away yet again, I ask the question, when does it stop?

3. Spanner Crab quota managed fishery – Shane Snow

The 1999 annual quota for Spanner Crabs in managed area was set at 2,800 tonnes – Source: Fisheries (Spanner Crab) Management Plan 1999, page 17.

Now some 21 years later it sits at 891 tonnes. I ask again, since quota managed fisheries are so great, (according to FQ) then why after 21 years is the quota holdings down by nearly 2,000 tonnes or 71%?

Surely it doesn’t take 21 years for stocks to rebuild if they were fished too heavily in the late 1990s?

In all the meetings that I have attended or conversations that I have had with certain fisheries managers one common theme that FQ have tried to reinforce time and again is ‘just how fantastic quota will be’. Through FQ’s own legislation, this tells us the complete opposite.

4. Some huge concerns to industry – Shane Snow

Do we own our quota forever?

We do in real time but this asset can also be stripped away from us in the blink of an eye. Who wants to invest considerable dollars into something that can be worth nothing overnight at the whim of FQ?

Do we own our quota forever? FQ say yes. But no, we don’t. It is nothing more than a fishing access or fishing privilege that allows us to harvest a portion of the public resource, one that again can be stripped away by FQ at any time

Can we use quota as collateral with lending institutions? No, we can’t. Lending institutions will not lend money against quota as they cannot take a third-party interest over it. No financial institution is interested in lending money against something that can be rescinded by FQ at the blink of an eye for various reasons, that would be financial suicide and will never get over the line within the guidelines of financing.

It is very important to remember that neither the coral trout or spanner crab fishery quota has ever been increased back to the original quota amount or above. A FQ senior fisheries manager had tried for a long time to convince me that, (in her words) ‘quota won’t always sit at what it is now, the kg value of each unit will increase over time’, well I call a double load of BS to that.

If the quota pool or kg value per unit has not increased over the last 21 years (Spanner Crab) it is never going to. You be the judge people; all the facts are in this article.

World Class Fisheries Management? I think not. As we have seen to date so far, quota values keep being eroded by FQ year after year until eventually what we have left will not be enough to keep us viable. Lazy, toxic mismanagement and smoke and mirrors are but a few polite terms that come to mind.

5. An Industry Advocate View – Eric Perez

Shane provides some damning insights into the introduction of quota across the Queensland commercial fisheries.

I will be less kind and suggest that this industry has been consistently fed a positive narrative for the introduction of quota management. It should be considered that quota will:

  • Limit catch based on no scientific data.
  • Potentially bankrupt commercial fishing businesses who currently have access to commercial fisheries but will lose that access due to the introduction of quota.
  • Increase fees from current arrangements to new quota fees.
  • Lead to fees that will remain static or increase irrespective of changes (typically a loss of value) per unit (kg value per quota unit).
  • The value of our kg per quota unit can be manipulated by FQ as a result of advocacy from conservation or recreational fishing groups.
  • Not be an asset that is recognized by financial institutions.
  • Not lead to any environmental benefit for our fisheries, it is simply lazy, opportunistic management.
  • Corporatise our fisheries – I don’t believe industry or the public have entered into any discussions around the corporatisation of our industry.

It is well worth reiterating that financial institutions are unwilling to lend against quota.  A commercial fisher recently shared some feedback from their financial institution noting: ‘Despite your excellent credit history with a number of lenders, we are not able to progress your request at this time.  The various lenders have indicated that they are not willing to advance the funding you require with the Commercial Fishing Quota as security. The lenders have noted their past experience with taxi licenses as part reason for their reluctance to fund’.

What we are seeing is poor policy making at its best (worst?).  When will this industry be the recipient of common sense, win-win policy development?

Authors: Shane Snow, QSIA Director and Eric Perez, QSIA CEO

Image: QSIA

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