The
Committee consisted of the following
Members:
Chairman:
Dr.
William
McCrea
Barlow,
Ms Celia
(Hove)
(Lab)
Bradshaw,
Mr. Ben
(Minister for Local Environment, Marine and
Animal
Welfare)
Bryant,
Chris
(Rhondda)
(Lab)
Curtis-Thomas,
Mrs. Claire
(Crosby)
(Lab)
Field,
Mr. Frank
(Birkenhead)
(Lab)
Goodwill,
Mr. Robert
(Scarborough and Whitby)
(Con)
Henderson,
Mr. Doug
(Newcastle upon Tyne, North)
(Lab)
Huhne,
Chris
(Eastleigh)
(LD)
Swayne,
Mr. Desmond
(New Forest, West)
(Con)
Ussher,
Kitty
(Burnley)
(Lab)
Vis,
Dr. Rudi
(Finchley and Golders Green)
(Lab)
Wallace,
Mr. Ben
(Lancaster and Wyre)
(Con)
Walley,
Joan
(Stoke-on-Trent, North)
(Lab)
Watts,
Mr. Dave
(Lord Commissioner of Her Majesty's
Treasury)
Wiggin,
Bill
(Leominster)
(Con)
Williams,
Mr. Roger
(Brecon and Radnorshire)
(LD)
Wilson,
Mr. Rob
(Reading, East)
(Con)
Susan
Griffiths, Committee
Clerk
attended the Committee
Ninth
Delegated Legislation
Committee
Wednesday 14
March
2007
[Dr.
William McCrea
in the
Chair]
Decommissioning of Fishing Vessels Scheme 2007
2.30
pm
The
Minister for Local Environment, Marine and Animal Welfare
(Mr. Ben Bradshaw):
I beg to move,
That the Committee has
considered the Decommissioning of Fishing Vessels Scheme 2007 (S.I.,
2007, No. 312).
I am
grateful to the Delegated Legislation Committee for arranging this
debate. This statutory instrument will allow us to run a targeted
decommissioning scheme for vessels over 10 m long operating in the
western channel sole fishery in International Council for the
Exploration of the Seas area VIIe. The Government believe that that is
vital to enable fishermen dependent on that threatened stock to make an
assessment of whether to remain in the industry, and to ensure
sustainable stocks of sole. To that end, we have put aside £5
million for the scheme.
We have also negotiated with
the European Commission to secure a fair deal for Cornish boats, and we
have listened to the concerns of fishing industry leaders by increasing
the amount of money available per vessel to reflect the current value
of boats and licences. We also plan to put in place criteria for
prioritising which boats should be decommissioned. The criteria will
mean that we are better able to target those boats that have the
biggest impact on the fishery, rather than those that are simply the
cheapest to decommission. I will go into more detail shortly.
The SI covers, first, the
criteria that vessels must meet to be eligible for decommissioning;
secondly, details of how to apply for a decommissioning grant; thirdly,
details of how we will award that grant; and, fourthly, details of what
successful applicants must do once they have been offered a
grant.
We thought
long and hard before taking the decision to run another decommissioning
scheme for fishing vessels. Fleet capacity in the UK has been
decreasing over a number of years as fish stocks have declined.
However, the reduction in capacity has not been in step with the
reduction in opportunity. Consequently, some excess capacity in the
industry has been bridged by illegal landings, fishermen operating at a
loss, delaying investment, or a mixture of all three.
We looked at the possibility of
running a general decommissioning scheme open to all larger vessels,
but after looking at studies of previous general schemes and after
taking current economic thinking into account, we concluded that such
schemes are not the most effective way to reduce fleet capacity. That
is mainly because many owners of decommissioned vessels use the grants
to modernise another vessel, to buy a new vessel and licence or to fund
retirement when they would have left the industry anyway. So,
while decommissioning permanently removes capacity, the reduction is
partially offset by the use of grants for vessel purchase or
modernisation. In addition, repeated decommissioning schemes create an
expectation that delays fishermen from making assessments about whether
to remain in the industry.
Like others, the south-west
beam trawl fleet, which the proposed scheme targets, may have delayed
making an assessment of its future in the industry in the expectation
of a general decommissioning scheme. However, it faced the additional
uncertainty of the prospect of a long-term management plan for the sole
stock in the area. Now that the management plan is about to be agreed,
a decommissioning scheme for vessels in that fishery will allow owners
to make an assessment of whether to remain in the fishery, to diversify
or to leave based on a long-term view of prospects.
Scientific evidence shows that
area VIIe sole stocks are near or at a historically low level, caused
mainly by over-fishing, which has caused a downturn in the
profitability of vessels in that fishery, exacerbated by recent high
levels of fuel prices, as beam trawling is a fuel-intensive method of
fishing. For the sector to be sustainable under current quota limits
and fuel prices, there has to be a reduction in the fleet. Running a
small, targeted decommissioning scheme for beam trawlers that are
active in the area covered by the management plan seems most likely to
offer value for money, as the reduction in capacity and effort from the
fishery should help the plan to succeed.
In determining how the scheme
will work, we have decided to keep the basic eligibility criteria the
same as those for previous schemes, but there will be an additional
requirement that candidate vessels must have been allocated days under
the current days-at-sea scheme for area VIIe sole. As I mentioned at
the outset, we have also decided against the previously used scheme,
which simply selected the cheapest vessels for decommissioning, and
risked ranking redundant vessels more highly than those which had the
most impact in terms of conservation. Instead, we have chosen a vessel
ranking system that takes into account the value of the bid per tonne
of capacity to be removed, the fishing effort and the amount of sole
caught in area VIIe during a reference
period.
Bill
Wiggin (Leominster) (Con): One thing that I hope the
Minister will touch on before he closes is why it is necessary to allow
the quota to remain. He has taken into consideration the days-at-sea
element of fishing effort in defining the type of vessel that will be
eligible. However, if he allows the fishermen to retain the quota, the
problems of fishermen refurbishing other vessels or reinvesting, which
he mentioned earlier, continue. Why does he not take the quota back
too, when he
decommissions?
Mr.
Bradshaw:
The quota is not ours to take back. Quotas are
set, and they are owned by the skippers of the vessels, who can
transfer them to another boat. We are not able to take that quota back,
but we have reduced the quota year on year and I will give the
Committee the figures in a moment. I urge the hon. Gentleman and anyone
else who is interested in the technicalities of the matter to take the
opportunity of
having a technical briefing with my officials, because the criteria are
extremely complex.
The
system should remove from the fleet vessels that have the greatest
impact on sole stocks in area VIIe. All vessels fishing in the area
will be eligible for the scheme; vessels with more fishing effort and
higher catches of sole will rank more highly. The £5 million set
aside should allow us to decommission up to 12 boats. At present, about
60 vessels would meet the basic eligibility criteria for the
scheme.
The
arrangements for funding the scheme are more complicated than for
previous ones. In choosing to run the scheme for vessels prosecuting
the area VIIe sole fishery, payments for vessels based outside Cornwall
will be made under the Financial Instrument for Fisheries Guidance, or
FIFG, and will be made upof 50 per cent. from FIFG funds and
50 per cent.from Government expenditure. However, there is a
possibility that some of the eligible vessels will be based in
Cornwall, which, thanks to this Government, isan objective 1
areaa region whose GDP is less than 75 per cent. of the
Community averageand it receives its own budget for FIFG
payments.
The
Cornwall Monitoring Committee, which controls the Cornish budget, has
no remaining funds in the decommissioning budget line, and has
committed its budget to other areas. Consequently, we sought and
received permission from the European Commission to use state money
fully to fund any successful eligible Cornish vessel. That will not
contravene state aid rules.
We also listened to
members of the industry who pointed out that the maximum payments
available under the FIFG regulation were not high enough to cover the
current values for vessels and licences. The Commission agreed with our
assessment and has agreed to our paying more. We set our own maximum
level of £3,500 per tonne for bids, which is based on figures
indicated to us during the consultation period and is about 16 per
cent. higher than the current EU maxima. We did that to encourage
applications for the scheme because full utilisation of the available
funds will offer the management plan the best chance of
success.
The previous
approach to decommissioning without a sharp focus on stock conservation
would not now provide the best value for money, and the proposed scheme
will be successful in protecting stocks.
2.37
pm
Bill
Wiggin:
First, I put on record that I gratefully accept
the Ministers kind offer of a technical briefing.
Decommissioning
has an important role in fisheries management. One of my first
impressions from the Ministers reply about fishing boats being
decommissioned was that, of course, we cannot take away the quota
because it belongs to the fishermen, but, equally, so do the fishing
boats, which is why there is decommissioning. I am not sure that the
logic works completely, but we will revisit the matter in due
course.
The scheme
needs to be put into the context of the proposed sole management plan
and I hope that the Minister can confirm whether the plan will still be
formalised at Aprils Fisheries Council. Will he also give
further details of the methods that will be used by
the UK and other EU countries, specifically France, further to reduce
fishing effort as planned for 2010 to
2012?
From a joint
statement made by the Council and the Commission, it seems as if Europe
wants to reduce fishing effort in area VIIe in 2010 to 2012 by 15 per
cent. compared with the 2007 level, having already reduced the level
between 2005 and 2007 by 20 per cent. As I understand it, that is to be
achieved through a reduction in days at sea. Does the Minister think
that that will be sufficient to recover sole stocks and manage them at
a sustainable level? Aside from the planned reductions in the total
allowable catch, what other measures does he think are necessary?
Moreover, is there likely to be any further area VIIe
decommissioning?
Decommissioning
is supposed to bring environmental benefits and the risk assessment
states that the
scheme
should have a
small beneficial effect on the marine
environment.
Small
is not specific, and I hope that the Minister will elaborate further on
what he means by that. Does he know by how much the scheme will improve
local stocks or reduce the damage to the sea bed surface, for example,
or the impact that it will have on discarding?
A vessel owner who qualifies
for a decommissioning grant will still retain their fixed-quota
allocation, which can then be sold or leased. Given that in the last
couple of years landing area VIIe sole has been within
ahairs breadth of the maximumin 2006, uptake
was 99.8 per cent. and in 2005 it was 98.5 per cent.does the
Minister think that it is likely that the quota from a decommissioned
vessel will still be used? Following on from that point, how will the
proposed marine Bill have an impact on area VIIe fishing? I know that
the White Paper is out tomorrow, but if there are any proposed measures
that will assist us with that discussion, it will be helpful if the
Minister could let us know.
Decommissioning schemes in the
past have usually not been regarded as particularly successful.
Fishermen have, for example, reinvested the money in other boats, as
the Minister said. Does he expect that the vessel owners who
decommission will use that money to upgrade other vessels? Given the
targeted nature ofthe scheme, I hope that it will be different
and bring benefits to the environment and to the fishermen
affected.
Can the
Minister update us on plans for future decommissioning schemes? The
Prime Ministers strategy unit report, Net
Benefits, supported the need for a certain amount of
decommissioning: some 13 per cent. of the white fish sector. What
further studies are the Prime Minister, the Department for Environment,
Food and Rural Affairs and the European Commission conducting to look
into the effect of decommissioning on fish stocks and fishing
communities? I acknowledge that the EU has given permission to pay a
higher rate for this scheme than the usual maximum, and that is
welcome.
How much
more interest does the Minister think that that higher rate will
attract? It is likely that that will set a precedent for future schemes
affectingUK fishermen. I understand from the regulatory impact
assessment that eight to 10 vessels will be decommissioned. I do not
know if that is correct; the Minister mentioned 12. If there is
insufficient funding
around the time of the scheme, when will there be a
further scheme to match potential demand?
The Minister may be aware that
when the SI was debated last week by their Lordships in the other
place, Lord Rooker stated that £5 million
should allow for the
decommissioning of up to 12 boats.[Official Report,
House of Lords
7 March, 2007; Vol. 690,c.
GC21.]
It would be interesting
to find out why DEFRA thinks that 12 is now the right figure instead of
10 or eight.
It says
in the explanatory memorandum that
for
the scheme to be
successful, there needs to be sufficientnumbers of applicants
to make the bidding for grant funding
competitive.
Can the
Minister let us know how many applicants will be needed for there to be
a sufficient number, and if there is not a sufficient number, will the
funding for decommissioning still be made available to those who
applied? The RIA also states that there are 58 vessels that have landed
sole caught in area VIIe in 2005 and 2006. How many of those will
fulfil all the criteria of paragraph 2, and what is the time frame for
the application process? When will it begin and when will it
end?
The awarding of
decommissioning grants appears to involve a somewhat elaborate scheme,
whereby the Secretary of State devises a ranking system taking into
account the criteria outlined in paragraph 4(5) of the SI. Those
criteria are the bid figures: the vessels tonnage and the size
of the sole catch. However, it does not really specify how the ranking
system will work. For example, we do not know whether it will result in
a higher ranking for vessels with higher sole catches, or ones with
larger tonnage. It would be helpful if the Minister could let us know
how vessels will be ranked, and the formula that he will use to do
that.
The statutory
instrument states that the Secretary of State must allocate
decommissioning grants to the highest ranking vessels until there is no
longer any of the £5 million left. I note that the RIA estimates
that the vessels with the highest tonnage will qualify, and that that
the figure may be some £1.3 million, but it does not leave a
great deal of money for the rest. In the event that there is not enough
money left in the pot to fund the decommissioning of a vessel that is
next in the ranking list, if there is one with a lower ranking but
whose grant bid would not cause the £5 million to be exceeded,
will that vessel be allocated funds? That is quite important because we
want to get as manyvessels decommissioned as possible, and if
there isonly a certain amount left in the pot, that might
decommission only a much smaller vessel, but obviously that would be
better. Would any of the unused funds be lost or paid back to the
European Union? What would happen to money that was not used for
decommissioning?
Options 2 and 3 of the RIA,
which the Minister declined to take, suggested
that
the least expensive bid be ranked
top.
The ranking system
proposed in option 4, which the Minister has chosen, does not
prioritise the least expensive bid. What would be the difference in the
number of vessels decommissioned and the difference for fish stocks and
the environment of using the option 4 ranking system as opposed to the
least expensive bid?
2.45
pm
Mr.
Roger Williams (Brecon and Radnorshire) (LD): I, too,
welcome the scheme, although my party recognises that previous
decommissioning schemes have not been as successful as might have been
hoped because the money has been reinvested in more efficient and
effective vessels. However, the parlous and unsustainable state of the
sole stocks in the area should encourage Ministers to take action, and
we believe that decommissioning is the right way at this
stage.
Many of my
questions have been asked by the hon. Member for Leominster. It would
be useful if the statutory instrument included a suggested application
form, so that we could see what the administrative burden would be on
the people who applied, and how clearly they were told what the
requirements of the scheme were.
The Minister said that he
anticipates that 12 vessels will be covered by the scheme, although
other figures have been mentioned in other places. Could he give us
some indication of the reasons behind his estimated figure?
The hon. Member for Leominster
asked about the ranking scheme. Under previous decommissioning schemes,
the cheapest were ranked top, but that is not going to be the case
here. I welcome the Ministersoffer of a technical
briefing, because the matter is complicated. Can he tell us whether the
most important criterion is going to be the number of days at sea or
the total tonnage of sole that has been
taken?
If any money is
left over when most of the £5 million has been allocated, will
it be used in a proportional decommissioning scheme, or will it be made
available for the decommissioning of a boat that has not had such a
high ranking in the
scheme?
That covers
our concerns. We look forward to hearing the Ministers
response.
2.47
pm
Mr.
Bradshaw:
In response to the question from the hon. Member
for Leominster about whether we still expect the scheme to be agreed at
the April Council, the simple answer is yes. One can never be sure what
is going to happen at Fisheries Councils, but that is our expectation.
The agreed principles of the recovery plan involve an initial 20 per
cent. cut in fishing effort this year, compared with the 2005 base
line, with a further 15 per cent. cut in 2010 if necessary, and the TAC
to be set in line with the reduction in fishing mortality. The days at
sea in 2007 are 192, down from 216 in 2006. I said that I would give
the TAC and quota figure as well. In 2007, that was 529 tonnes, down
from 553in 2006.
On the timing, we are going to
invite applications before a closing date in May, and we hope to make
payments by November. It is not possible to prevent owners from using
any money that they might receive to upgrade other vessels. However,
because this is a targeted scheme, the opportunities to do that will be
limited, because people will need to obtain the necessary days at sea
if they are going to target sole. However, they could use the money to
upgrade vessels that are targeting other species. To be honest, there
is no reason why they should not, so long as they are practising in a
sustainable fishery.
The hon. Gentleman asked whether
the recovery plan is sufficient to recover the stocks. We shall have to
wait and see. We do not rule out having to take further measures and
the plan allows us to do that if the measures that we are taking are
not seen to have an effect in the immediate future. He asked also why
it was necessary to allow the quota to remain. It needs to remain
because when, as we hope, the stocks recover, the vessels remaining in
the scheme will not have enough quota to remain viable. In addition, if
the quota were decommissioned, it would cost us a lot more, so we would
have to buy the quota out,
too.
The marine Bill
should not have a direct impact, but of course, we are hoping that it
will improve fisheries management by modernising the sea fisheries
committees. That should help and hopefully lead to
better enforcementmainly in the in-shore area. However, I hope
that the marine Bill will help us to take a more holistic and
sustainable approach to the marine environment. On whether the quota
and other vessels will still be used, as I think that I said before,
they will still be used only if the vessels have an allocation of days
at sea.
I think that
that covers all the questions, but if I have forgotten any points
raised by hon. Members, I shall gladly write to
them.
Question put
and agreed
to.
Resolved,
That the Committee has
considered the Decommissioning of Fishing Vessels Scheme 2007 (S.I.,
2007, No.
312).
Committee
rose at nine minutes to Three
oclock.