Examination of Witness (Questions 160-169)
Mr Bertie Armstrong
19 MARCH 2008
Q160 Lord Palmer: You mentioned that
the practice of landing "black" fish has virtually now
been eliminated. To what do you ascribe this success? What do
you consider to be the key pillars of any revised EU control and
enforcement regime?
Mr Armstrong: I would ascribe it to two things.
There are two pillars supporting this table top. One is legislation
that applies or regulation that applies to all, and that was the
introduction of registration of buyers and sellers which made
it a criminal act not only to sell the fish but also to buy it
and the records have to match. Almost at a stroke, everyone breathed
a sigh of relief and said, "I can now abandon the Tragedy
of the Commons. If he is doing it, I have to do it, otherwise
I am commercially disadvantaged. We are all going to get caught;
therefore none of us will do it." That is the common explanation
of what happened. That made the playing field flat in the UK for
everybody. You can supply fish into a market only if they are
legal. The first thing that happened was that the price of fish
went up, so people immediately had a commercial impetus to carry
on doing this. That is the first pillar, the regulatory pillar
that bites or that works. The second, talking of the heaving of
a sigh of relief, is the recognition of the industry that this
makes absolute logical sense. There is no point in "black"
fish if it is widespread: it distorts the market; it distorts
the science, because scientists have to make some sort of guess
as to what you are doing; and it is absolutely no good for fish
stocks. It is a happy story and it is auditable, I am now delighted
to say, with the Scottish fishing industry, God bless them, boastfully
producing charts that show their intelligence (what we think you
are doing) and the prosecutions (what we caught you doing), with
the curves coinciding down at the x axis, which is wonderful.
Chairman: My own little story on "black"
fish is that many, many, many years ago I made a speech attacking
the practice of "black" fish and a senior and distinguished
member of the industry came up to me afterwards and said to me
that he totally agreed with me as long as we made sure the Scottish
fishermen got their fair share of the "black" fish!
Let us go on.
Q161 Lord Cameron of Dillington:
You have already spoken about a level playing field in terms of
effort control and I suspect there was an innuendo of a level
playing field in terms of "black" fish in some of your
answers there, but I want to talk about capacity because, ultimately,
that is really what it is all about. You claim that the capacity
in the Scottish fleet is now balanced with catching opportunity.
I would be quite interested to know what you base this on but,
more importantly, how can we achieve the decommissioning or the
right-sizing of capacity across Europe? It may be the same answer
you gave to the Chairman on effort control, that you do not really
know how to answer it, but does the European Fisheries Fund help?
Could that be reorganised or restructured in a way that might
make it more relevant?
Mr Armstrong: I think we are where we are with
the European Fisheries Fund and it does not help overmuch. There
is not an enormously significant amount of money in it. The basis
of evidence of right-sizing of the Scottish fleet—which
is the one I can talk about on the statistics—is that two
rounds of decommissioning took out about 65% of the capacity of
white fish. There was a really swingeing pair of rounds of decommissioning.
We are now seeing—and this I offer as evidence of right-sizing—a
degree of optimism in the fleet: people are now making enough
money to consider fleet renewal. That is by no means fleet expansion—we
cannot do that under the rules—but fleet renewal. People
now have the confidence to go and buy another boat or have another
one built. I would say that is the best evidence of right-sizing
because people are turning a profit, making enough money to make
it viable. There will always be ups and downs in an ecosystem
where everything eats everything else, but we are seeing fish
stocks which you might describe as relatively stable and relatively
hopeful. There is work to be done in all directions but we are
not on a downward spiral of a decline in fish stocks. That, combined
with commercial viability, would seem to indicate about right-sizing
of the fleet. How you get this spread across Europe is, indeed,
a similar answer to the one I gave to my Lord Chairman where I
described the problem in more detail: I have no real sensible
answers to how we do that, except to note that it is an extremely
desirable thing for it to happen.
Chairman: Let us finish off with RACs.
Q162 Earl of Arran: We have touched
on this so far but, as you say in your evidence, some RACs are
further advanced than others due to a complex remix of different
RACs, et cetera, and they are pretty much in their early stages,
but do you think they do have the potential for more power being
given to them?
Mr Armstrong: It is a very interesting question
as to whether more power is the central question. I would stick
my neck out and say, and I have no mandate to say this—not
because it is outrageous; we have not discussed it—that
they are not in a condition yet where they can make rules. Unanimous
recommendations can be made. I would shy away from saying they
are at the level of development where that ought to be mandatory,
taken as the rule-making. Where they can certainly give of their
best, I believe, is in the formulation of longer-term management
plans because that is the form in which the industries and stakeholders
are set up, the NGOs. There is a degree of balance there. If you
get a unanimous decision from a RAC, then probably it is due to
two things. One is that it is the correct decision—and we
hope that will be the case in most cases—or it is very local
and nobody else cares. We have to guard for that, that the small
species in one corner of the Bay of Biscay gets a unanimous decision
from a RAC because nobody cares. I would not wish to be disparaging
but a unanimous decision is good. Delegation of power? Yet? It
is a bit early but we hope that—
Q163 Earl of Arran: How about responsibility
rather than power?
Mr Armstrong: I think we could turn that around
to say that the RACs probably will not survive unless they demonstrate
responsibility. We will all lose faith, both as Member States
and no doubt the Commission also, if there is continuous lobbying
in an unreasonable fashion for matters which do not properly deal
with matters conservation or are excessively local.
Q164 Lord Palmer: You mentioned about
some of your members reinvesting in boats. Can you remind us very
roughly what the lifespan of a boat is?
Mr Armstrong: It can be almost anything you
care to make it if you cannot afford a new one. There are boats
on the Clyde which are 30 or 40 years old. On the other hand,
at this point in time—
Q165 Chairman: I think you have just
made a few enemies.
Mr Armstrong: The commercial viability of, for
instance, the pelagic sector means that these boats get replaced:
five/seven years is their lifespan. It is wholly dependent on
the individual.
Q166 Chairman: The other underlying
thing here is that one of the problems with the industry is that
it is overcapitalised in any case.
Mr Armstrong: Yes. Would it be all right, my
Lord Chairman, just to have a mention on rights-based management?
Q167 Chairman: Yes.
Mr Armstrong: The most important thing, the
blood in the veins of the fisheries body, is quota. How that is
organised or allowed to flow is the biggest lever that can be
pulled to create a change in direction or an alteration in the
industry. If you glance around the European industries, how they
organise their quotas is at least significant in how they are
organised. There is a general move towards considering that a
market-based solution to fisheries is the best thing: If you had
individual tradeable quotas (ITQs) then that would fix it, would
it not, because the market could then decide and it would have
to be profitable and it would not be profitable if it was not
sustainable? It is interesting to note that the way the UK industry
but most especially the Scots industry is set at present is a
large collection of small- and medium-sized enterprises mostly.
A lot of it is family owned. A change to ITQs would internationalise
the whole thing very quickly and you might take a global view,
an economist's snapshot perhaps, of the European fishing industry
and say, "After that happened, things got better," but
you might wonder whether you had done the best thing for UK plc
by doing that. A glance at the map of the UK industry and particularly
the Scots industry is that we have got what everybody else wants.
We have in that swathe of water a world-class resource. If you
look at the size of the continental shelf of, for instance, Spain
and then the size of their industry you get a surprise and say,
"How on earth did it grow that big and why?" which leads
to a daily attack on relative stability. The first thing that
would change the character of the European fishing industry and
transfer ownership into an international sphere but, actually,
dare I say it, straight to identifiable other Member States and
beyond the EU at a stroke, would be the creation of ITQs, so great
care is needed here. This is the biggest lever that can be pulled.
If it is to go in the direction of ITQs we will change things
mightily.
Q168 Lord Cameron of Dillington:
But no-one is forcing anyone to sell.
Mr Armstrong: No, but if you create the conditions
where, if it suits an Icelander to wait for a downturn in the
price of mackerel and come along and say, "Would you like
to be in the Caribbean tomorrow? I have a forklift or money here,"
the unstated sentence is—and this is a completely fictitious
example—-
Q169 Chairman: We do not stop foreigners
buying farms.
Mr Armstrong: Whether you support globalisation
or internationalisation is not at the heart of the argument; at
the heart of the argument is what will be the effect of creating
this and the economist view probably is that it will be for the
betterment of the whole European industry if it is allowed to
be subject to market conditions, because that will automatically
fix things. We need to be careful because I am not arguing for
a backward look here but you need to be absolutely aware of what
will happen if that occurs. It may be that the transfer of the
pelagic fleet of the United Kingdom into Icelandic/Dutch hands
is not a problem or you may find that the only fishing vessels
in the North Sea are the very efficient and nice new Spanish vessels
which are coming from Vigo because they bought everything. That
may well make for a percentage price reduction on Waitrose's shelves,
but it is whether that is a desirable matter altogether for UK
Plc. I am not arguing for trade protection, I am just arguing
for wide-open eyes as to the effects of these changes and as to
whether or not the most efficient market in European terms is
the best solution in United Kingdom fishing terms.
Chairman: Thank you very much; it is always nice
to end on an uncontroversial note. It has been really interesting
and very helpful for us; thank you.
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