Select Committee on Agriculture Appendices to the Minutes of Evidence


Memorandum submitted by the Fleetwood Fish Producers' Organisation Limited (J45)

  The Committee, following a visit to Spain last month when, among others, they had discussions with Sr Ricardo Hermida (Pescagalicia) have requested this memorandum setting out the background to our relationship with the Spanish-owned, UK-flagged fleet, the advantages we expect to gain from the association and how we think it will develop. Any additional comments are invited.


  The committee will already be aware of the alarming decrease in the indigenous fleet at Fleetwood. By the summer of 1997 our Producers Organisation had a membership of 29 vessels as compared with 48 five years earlier.

  The Decommissioning Round in late 1997 again hit us hard. No fewer than seven vessels had their bids accepted. The governments decision to allow the owners of decommissioned vessels to sell their quota/track record on the open market to the highest bidders added to the "Gold Rush". Naturally the clamp down by HMG on illegal (black) fish gave huge impetus to the market in quota.

  A decision was made by our Board of Directors to purchase all we could of our local "Decommissioned Fish". We succeeded in all but one case. In doing so our liquid assets were stretched to the limit. We had spent £45,000. We then had the opportunity in the Spring of 1998 to purchase nearly all of the quota from a vessel coming into membership the price was £58,000 and we took on a loan from the Royal Bank of Scotland for that amount. This was a "good buy". Our existing members agreed to double their contributions to the PO from 1 per cent ad valorem to 2 per cent, the additional 1 per cent to go towards purchasing quota or helping service a loan(s) for that purpose. This would increase to PO's income from £20,000 pa to £40,000.

  Our PO was further hit in 1998 by several members with vessels under 12 metres overall taking advantage of the remarkable "legal" loophole whereby they "chopped" a bit off their vessel to bring it under 10 metres. They could then (and still can) sell their Class "A" licence and their quota/track record. These seem to have been bought by wealthy entrepreneurs who have made a lot of money trading in quota and licences. They are backed by very substantial liquid assets. The Committee will be well aware of their existence.

  The Committee will readily appreciate that by June 1998 the Fleetwood PO and therefore the fleet and jobs in general were in a precarious position. Yet there were, and still are, those who are determined to carry on and who fervently believe that Fleetwood's Fishing Industry must survive.


  In or about June last year we were actively looking for new members. We succeeded in attracting one. Then, and purely by chance, we heard that some 30 or so Anglo-Spanish vessels, then currently fishing the non-sector, were keen to join a Producer's Organisation, provided satisfactory agreement could be reached. Many of these vessels were agented by Hooktone Ltd of Androssan. We contacted their local Director, Mr Bill Brown who came down to Fleetwood for the first of what were to be several meetings. It transpired that the vessels involved (about 34) were based in La Coruña, Galicia. Hooktone Ltd is owned by the Hermida family, and has a company of that name in La Coruña.

  The discussions led us to realise that there were advantages for both parties.

  For Fleetwood we obtained an agreement that they would pay off an indebtedness to the bank £58,000. This has been done. They would pay an entry fee not later than December 1998 of £1,500 per vessel 30 metres and over £1,000 per vessel under 30 metres. This sum was paid and totalled £44,000. The Committee will readily appreciate that Fleetwood PO, from being in a very precarious financial position in mid 1998 found itself in a far better position by the end of the year.

  My colleague, Mark Hamer, and our Vice-Chairman Chris Neve first visited La Coruña for three days in the Autumn. They met all owners who had applied for membership and also the Board of Pescagalicia, who have become our agents in La Coruña. Mr Hamer and Mr Neve were both impressed as to the genuineness and expertise of our new "members to be". This meeting was followed by a visit to Fleetwood by three vessel owners from La Coruña and then by another visit to La Coruña by our Chairman and fisherman, Kevin Christian, and myself. We discussed and were satisfied with the preparations for Pescagalicia to act as our agent from 1 January 1999. We appointed a bilingual secretary at our office in Fleetwood. Francisca Segade is quite excellent at her job and has become a very useful and popular member of staff.


  Each Anglo-Spanish vessel pays to us the sum of £150 per month. This totals £57,600 per year. The total monthly figure is guaranteed to us by Pescagalicia, so that if anyone falls in arrears we are not saddled with the problem of "chasing him up". Our experience up to now is that the monthly payment is in our bank on the due date.

  Financially the Committee will appreciate that the association with our new members has proved a "Life-Saver". We have to exist in an Industry where the "Rich get Richer and the Poor get Poorer". We like to think that we are pragmatists and after the adverse effect on Fleetwood of the 1997 Decommissioning Round we realised no-one in the UK would invest in our future. We had to take the initiative ourselves and put aside our strong feelings against Spanish "Quota hoppers". We found this comparatively easy for our new members provide no competition. They target different species and fish entirely different grounds. Furthermore we realised that they are a "Fact of Life" and here to stay.

  Our new members, like everyone else who wishes to survive in today's Industry, have been in the market to purchase quota for species particularly suited for their home market. Included in this have been species which are of little use to them being in areas which they do not fish eg 16 tonnes of nephrops in Area VIIa. Instead of swapping these they have gifted them to us. Such gifts have benefited Fleetwood up to now with quota/track record valued in the order of £50,000.

  With our new members now starting, when possible, to land at Fleetwood, our infrastructure obviously benefits. We always expected that most of their fish would be trucked back to Spain, where the price for hake, monks and megrims are much better. What they do put on Fleetwood market is nevertheless welcome. Also they are using a local transport company, local shops for food etc and oil from UK oil companies all at which is good for our port.


  Whilst it is early days yet we have no-one who thinks we have done wrong. Quite the contrary in fact. We get on well with our new colleagues and we realise that it is up to us to provide a good and efficient service. This we intend to do. Our reputation will spread and we are confident that more will apply to join as time goes on.

  It is our hope that Fleetwood's fish merchants will be able to take advantage of the export opportunities which our initiative has opened up.

  The income which our new members will generate will be of tremendous value to our local Fleetwood fishermen. It will enable us to purchase more quota/track record (now FQA units), particularly in Areas VIIa and VI. This could well be by servicing loans. We have suffered badly in recent years from the activities of the wealthy entrepreneurs referred to earlier. For example they have targeted in particular the highly prized and priced dover sole which spawns and matures off our Lancashire Coast. This fish is right on our doorstep and yet our quota is down to a pitiful 17 tonnes. Much of what we had is now in Dutch hands. With a much stronger financial base we are now in a better position to compete. The so-called priority protection in the CFP for "local fishing communities" is looked at with derision in our Fishing Community, for we have seen no evidence of it so far as Fleetwood is concerned. In fact a local fisherman, thrown out of work and on Income Support, when the owner of his boat sold out to an entrepreneur, applied for Legal Aid merely to seek Counsel's opinion as to whether or not the legal obligation on the Commission to protect local Fishing Communities is enforceable at law—as straightforward "Yes or No" question. Very curiously he was refused and a written appeal got the same response. This was last year. We hope now that our Board will approve a request that we seek the Counsel's opinion referred to in view of our improved financial position. The increase in membership also means we are in a stronger position to negotiate contracts re purchase of fuel etc which will benefit all members.


  Fleetwood's Fishing Community has accepted, with little or no dissent, our new association with Anglo-Spanish vessel owners. Our fisherman members are glad to have them with us.

  For management of our Fish Producers' Organisation we have a Board of Directors of 10. Our agreement provides that a maximum of three of 10 of these can be Spanish. As for shareholders ultimate control, Fleetwood holds far more shares that the Spanish members.

  Naturally our new assocation did not suit everyone in the UK Industry and there were particularly vociferous critics in the South West. In order to "Keep the Peace" we resigned from the NFFO and then with unanimous consent rejoined through our Fleetwood Fishermen's Association—an organisation operated from this address but with no Anglo-Spanish members. We are therefore in the same place as we were before.

  We face the future with far more confidence than we had at this time last year but there still remains much to do.

12 April 1999

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