APPENDIX 29
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.
BACKGROUND
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.
FIRST CONNECTION
WITH ANGLO/SPANISH
VESSELS
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.
FURTHER ADVANTAGES
FOR FLEETWOOD
FROM OUR
"ANGLO/SPANISH"
MEMBERS
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.
THE FUTURE
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.
FINAL COMMENTS
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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