21 December 2002
Resource: Allocation between stakeholders
paper discusses the matters that the Minister of Fisheries is required
to address in determining catch limits for particular fisheries
and the process followed in allocating the allowable catch between
the various stakeholders. Some of the important considerations are
addressed in more detail in the associated papers "Maintaining
the marine environment and recreational fishing rights"; "Obligations
to Maori"; and "The legal nature of recreational fishing
total allowable catch
Act 1996 requires the Minister of Fisheries set a total allowable
catch (TAC) with respect to each quota management area for each
stock subject to the quota management system (QMS). For fish stocks
not yet subject to the QMS the Minister may set a catch limit including
a commercial catch limit but is not required to do so.
The TAC is divided
into shares for each of the respective stakeholder groups' catch
allocation, after allowing for other fish mortality arising from
the exercise of the catch entitlements in a particular fishery.
For non-commercial interests, that interest is expressed as an allowance.
The commercial entitlement is specified in the Act as a total allowable
commercial catch (TACC). The process by which the allowance for
non-commercial interests in the fishery is made is undertaken in
conjunction with the setting of the TACC.
Act does not prescribe the extent of the respective allowance for
each stakeholding interest, or the priority to be accorded to those
interests. The Minister has wide powers of discretion in deciding
the allocation to each stakeholder. However, the Act does contain
provisions establishing the nature of a stakeholders right and the
manner in which it can be modified. In addition, a number of court
decisions have provided further guidance as to the nature of the
Minister's responsibilities when allocating the TAC between stakeholders.
the TAC the Minister is required to consider the following factors
under the Fisheries Act:
o Maori customary
non commercial fishing interests [section 21(1)(a)(i)];
fishing interests [section 21(1)(a)(ii)];
fishing interests [section 20]; and . All other mortality of the
stock caused by fishing [section 21(1)(b)]
The Act requires
the Minister to give consideration to the Maori customary non-commercial
and recreational interests and all other mortality before setting
a TACC. Although the Act does not accord any of these factors priority
there are practical reasons why the "other mortality"
caused by fishing is considered first. Illegal catch (under reporting,
poaching, and discards), incidental gear mortality, and scientific
research are sources of "other mortality". Such mortality
is a fundamental element that affects the TAC available for apportionment
between competing interests. Attributing priority to this factor
acknowledges that such mortality is an unavoidable component of
the utilisation of fisheries resources. However, where the "other
mortality" can be attributed to a particular source it is equitable
that the attributed mortality is subtracted from the share of the
TAC apportioned to the relevant sector. '
The Crown has
obligations under Section 10 of the Treaty of Waitangi (Fisheries
Claims) Settlement Act 1992 and Section 5 of the Fisheries Act 1996.
[See "Obligations to Maori" paper.] The setting of the
customary allowance under section 21 should account for the extent
of customary non-commercial take as authorised under the customary
regulations. The Minister must balance these sets of rights with
those rights enjoyed by recreational and commercial fishers set
out elsewhere in the Act. There may be some circumstances where
the TAC is set so low that only Maori customary non-commercial fishing
can be accommodated and the Minister chooses to exclude other fishers.
has a right to fish for recreational purposes. This right is subject
to statutory controls in New Zealand. [See the paper "The legal
nature of recreational fishing rights".] The Fisheries Act
1996 provides for both commercial and recreational fishing. It affords
no legal priority to recreational interests in terms of the allocation
of the TAC for a fish stock. In New Zealand Federation of Commercial
Fishermen (inc) & Ors v Minister of Fisheries & Ors (HC,
Wellington CP237/95) (SNA1) McGechan J, without determining the
issue of whether recreational fishers are accorded priority under
the Act, stated that to allow for non-commercial fishing interests,
arguably does not mean that an allowance must fully satisfy estimated
are competing demands, which will exceed the availability of the
resource, the Act does not require the Minister to satisfy the needs
of all groups. Justice McGechan concluded in SNA1 that the requirement
to "allow for" the recreational interest is to be construed
as meaning to "allow for in whole or in part".
of Fisheries has discretion under the Fisheries Act 1996 to determine
the nature and extent of any priority between recreational and commercial
interests on a case by case basis. [McGechan J New Zealand Federation
of Commercial Fishermen (Inc) 7 Ors v Minister of Fisheries &
Ors (HC, Wellington CP 237/95 page 89) and New Zealand Federation
of Commercial Fishermen (Inc) 7 Ors v Minister of Fisheries &
Ors(CA 82/97, judgement of the Court delivered by Tipping J pages
of Fisheries is required to fix a TACC for all QMS fish stock. The
allocation of quota under section 47 of the Act creates a property
right for individuals who hold individual transferable quota (ITQ)
in a QMS fish stock. It is not an absolute property right as the
Fisheries Act 1996 makes it subservient to the exercise of the Minister's
powers pursuant to the Act. It is an inherent element of the QMS
that the TACC can be reduced, with a consequential reduction in
ITQ. In considering a reduction of the TACC the Minister is required
to consider, amongst other matters, the economic impact of his decision.
The Court of Appeal in CA82/97 held that it is in the Minister's
power to vary the ratio between commercial and recreational interests.
once the initial allocation was made. Similarly McGechan J in CP237/95
considered that a conscious transfer of catch between interests
is a legitimate activity within the context of the Act.
mortality" in large part arises from illegal fishing and to
a lesser extent commercial fishing.
The use of ITQ
to settle Maori commercial fisheries claims places an additional
onus on the Crown to maintain the integrity of the overall fisheries
management framework - a framework based on transferable property
rights that provide access in perpetuity to sustainably managed
fishstocks. Crown actions [such as reallocating fishstocks between
commercial and recreational fishers] that may diminish the worth
of the fisheries redress accorded to Maori, directly or indirectly,
need to be considered in full light of their potential implications
for the longevity of the settlement and the need to avoid creating
a new Treaty grievance.
provides that a reduction of the TACC for the purposes of ensuring
sustainability is not liable to compensation. The Act is silent
on the issue of compensation where a reallocation between commercial
and non-commercial interests takes place.
Determination of Stakeholder Interest
method by which the extent of an interest in a fish stock is assessed
is by a measure of the existing utilisation of the fish stock by
each sector group. The manner of calculation of that interest will
vary according to the level of information available. In the commercial
sector, reported catches for each existing QMS species is considered
to be an accurate record of commercial utilisation. Information
detailing catch levels for other sectors is generally less comprehensive.
Monitoring of the recreational and Maori customary noncommercial
harvest occurs retrospectively through recreational harvest surveys
and liaison with tangata whenua. Increasingly information on the
Maori customary harvest is being provided through reporting mechanisms
under customary fishing regulations. In the absence of precise information
reliance is made on the best available information. This is consistent
with the information principles set out in section 10 of the Act.
Consultation under section 12 of the Act is also used to determine
Act 1996 sets out an allocative process that involves three steps-the
setting or varying of a TAC; the provision of an allowance for specified
interests; and the setting or varying of a TACC. These steps are
interrelated but may occur independently of each other. For example
the TAC may be altered without affecting the TACC.
mechanism to guide the apportionment of the TAC between sector groups
is set out in the Act. A number of provisions, however, do provide
some guidance. The purpose of the Act, as set out in section 8,
is to provide for the utilisation of fisheries resources so as to
enable people to provide for their social, economic, and cultural
well being. Section 13 (3) requires that the Minister have regard
to social, economic and cultural factors when considering the way
in which, and the rate at which, fish stocks are moved towards a
level that can produce a "maximum sustainable yield".
This can be over a time period of the Minister's choosing. Section
five requires the Minister to have regard to the Crown's international
obligations, and those under the Treaty of Waitangi (Fisheries Claims)
Settlement Act 1992. Section 9 sets out environmental principles
that the Minister is required to have regard to when reaching decisions.
(See the paper "Maintaining the marine environment and recreational
fishing rights".) Other factors that may be relevant to informing
a decision are:
· Existing allocations
· Current harvest levels
· Previous decisions
· Equity of allocation (shared pain/shared benefit)
· Participation levels and the importance of the resource
· Population trends
· Relative value of the resource to respective sectors
· Current and past fishing practices (including over fishing
and voluntary closures by
· Investment and initiatives taken to develop or enhance
· Impact on the ability of sector to take allocation provided
· Economic impact of allocative decisions; and
· Social and cultural impacts of decisions.
about the current status of the stock relative to the statutory
target level, existing catch levels, existing allowances and catch
levels, plus previous decisions may indicate the actions which need
to be taken.
Act gives no priority to either commercial or recreational interest.
The Act is directed at providing for both recreational and commercial
[as well as customary] fishing. It permits the preference of one
sector to the disadvantage of the other (although the reallocation
of catch from commercial to non commercial fishers may give rise
to an issue in respect to the payment of compensation). Although
the Minister has discretion with regard to the allocation between
commercial and recreational fishers, case law suggests that it is
not unreasonable for both groups to share any of the pain arising
from a reduction in the TAC. There is no requirement for the interests
of both groups to be met in full. In the absence of information
about the relative benefits to be derived from allocating a stock
to one group or the other it would be reasonable for both groups
to ensure the sustainability of a fish stock through a shared reduction
in the TACC and the recreational allowance. Equally, both groups
should derive shared benefit from the rebuild of a fishery.
When the TAC
and the TACC are to be reduced for sustainability purposes there
is a relationship between managing recreational catch levels and
reducing the TACC and vice versa over which the Minister has discretion.
Although there is no legal obligation to undertake a proportional
reduction between commercial and recreational interests, consideration
of fairness suggests that it would be unwise to reduce one without
taking steps to constrain the other.
who are responsible for the enhancement of a resource should, for
equity reasons, receive the benefit of their activities. There are,
however, difficulties in ascertaining the increased harvest from
a fishery arising from such activities. This is a matter the Minister
can consider at his discretion.
are reflected in the level of recreational fishing undertaken at
a regional and national level. Growth in urban centres has a significant
impact on some fisheries. The allowance set and the associated management
controls need to take account of existing population growth and
are considered to be of importance to particular groups of fishers.
The value attributed to a resource is not limited to its economic
value but may include its aesthetic and non market values. Some
species, such as snapper, are a medium to high value fish, but also
have a high value as an important recreational target species. Certain
species such as kingfish may be valuable to particular groups, such
as charter boats, and may have significance for tourism. The abundance
of a species and the availability of a particular size of fish are
also important factors determining the value of a species of fish
to particular groups. These factors need consideration in allocation
of a TAC may result in the subsequent reduction of the TAC. Reported
over fishing by individual commercial fishers is subject to control
under the Fisheries Act. The consistent over fishing of the TACC
or an allowance, that results in a reduction of the TAC, as a general
principle, should be attributed to the stakeholder group responsible
for the over fishing. This is a matter at the Minister's discretion.
has an obligation under the Act to consider the economic, social
and cultural impacts of altering the TAC and its subsequent allocation.
The Court of Appeal [SNA1] has suggested that a careful cost benefit
analysis needs to be undertaken to support a particular decision
and that it should cover a reasonable range of options available
to the Minister in rebuilding stock levels towards that level allowing
the maximum sustainable yield. The Court considered it prudent for
the decision to clear identify the economic, social, and cultural
factors considered relevant to the decision and those not seen as
relevant. Those affected by a decision ought to be able to establish
that all other reasonable possibilities had been considered.