Committee Reports > List of Committees > Dáil > 1986 > Committee on Public Expenditure > Report No. 14 - State Support and Services to the Fishing Industry

REPORT

1. SUMMARY

1.In examining public expenditure on fisheries under its terms of reference set out above, the Dáil Committee heard evidence from and had further consultations with officials of the Department of Fisheries, BIM and the Central Fisheries Board. They also heard from and had consultations with a wide range of organisations representative of different aspects of the fishing industry.

2.The first draft of this report was prepared with the assistance of Mr. A. J. O’Sullivan, a marine biologist whom the Committee retained as consultant. Later drafts were discussed with three agencies directly involved in the various representative organisations of fishermen, anglers, fish processors and fish farmers.

The official figure for the value of fish landed including shell fish is about £62m. The value of angling as a contribution to tourism is a further £30m. Though the value of exports of fish and fish products were put at £102 m for 1985, income arising from fishing is less than £40m according to official figures. The truth might be as much as twice that. Total employment in the industry is estimated to be 13,000 people, over 600 of whom are engaged in aquaculture and 2,500 in fish processing and ancillary industries. A feature of the fishing industry’s contribution to the economy has been the relatively high rate of growth in employment in recent years and the regional spread.

Total public expenditure on the development and protection of the fishing industry even without allowing for debt servicing or amortisation is equal to or greater than the official figure for income arising.

3.Thanks to the work of the Sectoral Development Committee and the Sectoral Consultative Committee drawn from the fishing industry and more recently the Fisheries White Paper there is a considerable body of data on the present state and future prospects of the fishing industry. It is clear from this that the fishing fleet requires adaptation and modernisation without increased capacity. This inevitably means less boats. It is also clear that aquaculture represents a unique opportunity for Ireland and that policy, licensing, research and development, pollution control and grant support need streamlining if the potential is to be realised. The fish processing industry is still at an early stage of development and the appropriate structures for licensing and inspection are not yet in place to ensure, as in other aspects of the Irish food industry, compliance with the highest standards of world markets. This must be addressed.

4.A proper apportionment of the substantial costs of protecting EEC fisheries in Irish waters as provided for in the 1976 agreement with the EEC is another obvious need. It seems we are bearing 100% of a cost - 20% of which is appropriate to us by decision of the Council of Ministers. Some shift in focus in relation to these fundamental matters and a restoration of credibility to national fishery statistics are, in the opinion of the Committee, the necessary preconditions to increasing value for public expenditure in the industry.

5.To that end the following recommendations are made:-

-a more consistent and better presentation of fishery statistics with a greater role for the Central Statistics Office;

-State expenditure on Fisheries to be shown for particular programmes, activities or services consistent with the format of the Comprehensive Public Expenditure Programmes.

-better cost control on fishery harbour projects and provision for harbour and pier maintenance grants to Local Authorities;

-integration of State support to aquaculture;

-rationalisation of fisheries research and development including:-

-development and implementation of appropriate licensing and inspection for fish processing plants and implementation of the Sectoral Consultative Committee’s recommendations on quality control, marketing, processing and added value;

-streamlining of the functions of BIM including its withdrawal from direct involvement in banking and reassessment of its role in domestic market promotion;

-testing of alternative salmon licensing and protection system based on regional quotas and tagging of all salmon offered for sale;

-rehabilitation of riverbeds as part of river drainage programmes;

-implementation of the DPS report on CFB and after salmon licensing is restructured a re-assessment of angling with a view to applying the necessary measures for the future development;

-shift in emphasis in the training programme to accommodate the development of aquaculture and ANCo involvement in course design and appraisal;

-a negotiated transfer of responsibility to EEC for funding the cost to Ireland of protecting EEC Fisheries;

-a reorganisation of the Fisheries division in light of the changes in the industry and the recommendations in this report to include stronger management negotiating and economic inputs.

6.The Committee also noted the fact that the cost of debt servicing is treated in official data as a separate expenditure programme. The result is that borrowings have no cost on a particular department or programme whether for capital projects or otherwise.

7.This could have a number of consequences including understatements of expenditure on programmes, inadequate accountability for controlling capital expenditure programmes or that projects are undertaken where the benefits would not exceed the costs. It is difficult to imagine a capital project whose benefits would not exceed the cost where no costs are charged to the client department which is the practice.

8.Though this recommendation extends beyond the issue of Fisheries the Committee draws the attention of the Dáil to this anomaly and recommends that it be redressed.

2. TERMS OF REFERENCE

9.In pursuit of its terms of reference the Committee sought the response of the Department of Fisheries and Forestry to the questionnaire set out in Appendix 1 and subsequently invited the senior officials of the Department and of Bórd Iascaigh Mhara and the Central Fisheries Board to give evidence and be examined before the Committee. This involved five separate meetings of the Committee. Because of the scientific and technical issues involved the Committee decided, under paragraph (4) of its terms of reference, to obtain the advice and assistance of a consultant in drawing up its report. Mr. A. J. O’Sullivan, independent consultant with a background in marine biology and fisheries management, and specialising in natural resources management and environmental issues was commissioned to undertake the study and to report back to the Committee. This report of the Committee draws on the consultant’s report, published material, the responses of the public officials involved and other submissions and evidence offered by private interests in the fishing industry and their representative organisations.

10.Based on the terms of reference agreed with the consultant the report submitted to the Committee examines the various issues and areas of concern. This was reviewed with the Department and fishery agency officials and subsequently with the representative organisations before a draft of this report was prepared by the Committee which in turn was reviewed with the Government and non-Government agencies involved before the Committee prepared its final report.

3. APPROACH, SCOPE AND LIMITATIONS

11.Against the background of the consultant’s review the Committee sought to identify areas of operation where lack of cohesion, duplication of effort or conflict arise as well as those areas where there is co-operation and free flow of information. Such an approach suggests a need to examine all State services to fisheries in considerable detail. This would not only duplicate work already carried out by the Sectoral Consultative and Development Committees, the Management Services Unit of the Department of the Public Service and others, but it would also be impossible within the time and resources available to this Committee.

12.The Committee therefore relied on existing information and the evidence given by officials from the three organisations under review and the organisations representing the industry they serve, together with submissions by these organisations, and other published information. This was extended by further discussions with officials of the organisations, in which it was possible to explore in greater detail a number of areas of concern, issues raised and views expressed.

Background

13.Traditionally, sea fisheries was seen as a desirable, natural resource-based activity; if we did not fish our offshore resources, other nations would, thereby denting our national pride, irrespective of whether or not it was good or bad economics to fish these resources State support to the fishing industry has also been seen as having a highly valued social aim - to assist economically disadvantaged areas of the country and to generate wealth and employment in areas where opportunities to do so by other means were limited. Fisheries, along with agriculture, have always been recipients of State aid.

14.These social aims fall within the realm of broad policy issues to which any application of cost-benefit criteria would not be easy or appropriate, and which would be outside the scope of this Committee. So the Committee decided at the outset to examine whether the administrative and decision-making structures and processes are efficient and cost-effective in the implementation of policies, programmes and projects.

4. ECONOMIC IMPORTANCE OF THE FISHING INDUSTRY

Quality and Value of Fish Landed

15.In the period 1976 - 84 the quantity of sea fish landed at Irish ports increased from 80,700 to 205,000 tonnes. In the same period the value of the landings increased from £12.8m to about £62m. In real terms, however, measured by constant 1976 prices, the value increased by only 50%.

Over the 20 year period from 1963 to 1983 the total fish landings increased seven-fold from 27,000 tonnes to 206,000 tonnes. A particularly rapid spurt of growth took place in the mid 1970’s when the catch doubled in 4 years. However inadequate Ireland’s EEC quota might be, without this period of growth, it would be much less. Similarly it is argued that the new Common Fisheries Policy to be set in 1993 will confer quotas or access to Irish fishermen relative to their performance in the meanwhile. This may include the level of catch on hitherto non-quota species.

16.Official salmon landings declined from 1,492 tonnes in 1976 to 903 tonnes in 1982, but the landed value increased from £2.5m in 1976 to £3.8m in 1982 (SCC Report). Other fresh-water fish landed (sea-trout and eels) amounted to 163 tonnes with a value of £362,400. By 1983 the fresh-water fish catch amounted to 1,653 tonnes with a value of just over £7.0m.

17.Angling tourism also generates revenue which though not normally included in fishery statistics is nevertheless dependent on fisheries for its existence and is significant in relation to the value of the fish sector.

Current tourist value of angling is estimated to be of the order of £37m per annum. This is an area of considerable growth potential but relies heavily on adequate stock and pollution control and of course on effective protection of salmon.

18.The output of aquaculture has increased from 5,038 tonnes valued at £889,000 in 1976 to 6,700 tonnes valued at £3.1m in 1982 (SCC Report).

19.In summary, approximately £62m worth of fish or aquaculture products were landed in 1985 and if the value of tourist and home angling is added, sea and inland fisheries generated almost £100m.

Utilisation of the Fish Supply

20.In 1982, 51% by value of the fish caught was sold fresh or chilled, 36% frozen, 11% processed, and 2% went to withdrawal under EEC policy or fish meal.

21.Exports have increased significantly in recent years. Between 1976 and 1982 total exports of fish and fish products (including fishmeal) increased from 47,800 tonnes valued at £22.8m to 176,000 tonnes valued at £72.8m. The bulk of the increase in exports took place between 1979 and 1982 with the emergence of a large market for mackerel in Nigeria.

22.On the home market, per capita consumption of fish rose from 5.17 kg in 1976 to 5.78 kg in 1982, representing an average annual growth rate of 2%. Ireland’s per capita consumption of fish is still lower than that of most European countries. The amount of imported fish continues to increase. In 1982 it accounted for an estimated 41% of the domestic consumption (SCC Report).

Contribution of Fisheries to Gross National Product (GNP), Balance of Payments and Export Earnings

23.The Sectoral Consultative Committee estimated that the contribution of sea fishing to Gross National Product (GNP) was just less than 1% in 1982 (0.6% in 1975).

24.This figure seems to be based on the value of landings by the multiplier effect taken as 1.5. This of course is not comparable to GNP and it is therefore misleading to express it as a percentage of GNP. CSO figures for income arising from fisheries are, unfortunately, equally speculative, based as they are on what the industry would regard as substantially understated value of landings and a somewhat understated fleet operating cost. But fish exports make a relatively large contribution to Ireland’s balance of trade. In 1982, the net surplus on the industry’s balance of trade (exports less imports) was £47m, providing a 4% contribution towards offsetting the net deficit on the country’s total visible trade balance. In fact, the fishing industry makes a relatively greater contribution to the balance of payments than the chemicals, clothing, footwear or food industries.

Employment in the Fishing Industry

25.The Sectoral Consultative Committee estimated that there are 13,000 people employed part-time or full-time in the fishing industry. Over 12,000 are directly involved in the successive stages, from catching through to distribution, and the remainder are engaged in providing services to the industry in a full-time capacity. Employment has grown by 30% since the mid-1970’s, an average annual increase of 4%. This compares very favourably with the average growth in national employment of less than 1% over the same period. The numbers engaged in sea fisheries, as a proportion of the total male labour force, is higher in Ireland than in any other EEC country, with the exception of Denmark.

Regional Socio-Economic Impact

26.Despite its small contribution to GNP the fishing industry contributes significantly to employment and incomes in areas where there are few alternative sources. Estimates of the importance of fishing to the various regions in 1978 were as follows:-

27.An analysis of fish landings by port in 1982 shows that 68% of the total value was landed at ports along the South-West, West and North Western parts of the coast, which indicates that a substantial proportion of income from fishing went to the less developed regions.

Return on Investment in the Fishing Industry

28.In 1978 BIM commissioned a study, of the “Contribution of the Sea Fishing Industry to the Irish Economy”, which attempted to assess how the return on resources - capital and labour, both private and state in the sea fishing industry, compared with the rest of the economy. The results showed that in the period 1967 - 1975 the return on investment, using an Incremental Capital Output Ratio, in the fishing industry, manufacturing industry and the Economy as a whole were as follows:-

That is to say that in the period 1967 to 1975 in the case of the fishing industry that a IR £1.0m output in Year 2 requires a IR £2.5m investment in Year 1.

29.The conclusion drawn was that capital investment in the fishing industry was as productive as capital investment in manufacturing industry. It may be argued, however, that investment in the fishing industry is a higher risk than investment in other industries. This study did not include inland or recreational fishing which was the subject of examination by the Economic & Social Research Institute (ESRI) in 1973. If this were to be updated and broadened in scope to include trout, coarse fish and sea fish as well as salmon, the overall contribution of fisheries to the economy would be seen to be much greater. Employment and regional socio-economic impact data would also change, especially in some midland areas where tourist anglers make a contribution to the local economy.

5. PUBLIC EXPENDITURE ON THE FISHING INDUSTRY

30.Public expenditure on fisheries as published in the Annual Report of the Minister is set out in Table 5.1.

31.The Sectoral Consultative Committee, in its estimate of State expenditure on the fishing industry, included Roinn na Gaeltachta, IDA and Údarás na Gaeltachta grant approvals for fish processing and aquaculture. Total public expenditure taking these two additional sources into account is set out in table 5.2.

32.Since the development of fish processing is the responsibility of the relevant industrial development agency (IDA, Roinn na Gaeltachta, Údarás na Gaeltachta) in consultation with BIM, the Committee considered it more appropriate to examine public expenditure on the fish catching or production sector separately.

33.The Minister’s annual report, therefore, provides a reasonable starting point though this in turn can be updated by the Department of Finance publication “Comprehensive Public Expenditure Programmes” (CPEP), 1983 - 85, set out in

Table 5.3. Though the commonplace difficulty of reconciling data in the fisheries sector persists, even to historical expenditure figures, it is appropriate to use the Department of Finance figures since they are presented for the Fisheries programme on a comparable basis with other programmes.

34.To arrive at the true cost to the Exchequer of supporting the fishing sector two further additions should be made, however:-

-The servicing of the public debt is treated in these figures as a separate expenditure programme. This means that (a) the debt servicing cost of the historical capital spending programme on harbours and other capital expenditure relating to fishing and (b) the extent to which the fisheries programme contributes to the current deficit are excluded from the overall costs. There is no reliable basis for estimating this cost though it is significant and its absence understates the real cost to the Exchequer of the fisheries programme. However, it is an understatement which is common to all public expenditure programmes. The Committee is of the view that the Minister for Finance should provide a breakdown of the public debt by expenditure programme, incorporating the appropriate debt servicing costs in the programme costs.

-Fisheries protection, the cost of which is absorbed mainly in the Department of Defence estimates for the Naval Service and the Air Corps, must also be added to the fisheries programme. On the basis of the Department of Defence apportionments of the Naval Service and Air Corps, this amounts to £13.9m without taking account of interest or amortisation charges applying to over £50m spent on vessels (net £18m after EEC recoupment) or of Department administration charges relating to these services.

35.This brings the overall level of State expenditure on fisheries to in excess of £40m a year while income arising is officially estimated to be less than that. This takes no account of some administrative costs and no debt servicing or amortisation charges.

36.It is argued that the cost of fisheries protection should not be applied to fisheries alone and indeed the Committee acknowledges that it is a cost taken on by Ireland under the Common Fisheries Policy and under the Hague Resolution of 1976 Ireland should not carry more than its fair share of that cost. It is up to the Minister for Fisheries therefore to seek appropriate reimbursement so that the cost need no longer be assigned to Irish fishermen.

37.It is also argued that the value of the fresh water catch (put at £7m) or the tourism income arising (£37m are not set against this expenditure). Since 70% of the £6m cost of the Central Fisheries Board is incurred on salmon protection and much of it at sea trying to ensure that some salmon get to the rivers to spawn it is difficult to see that the appropriate adjustment could significantly affect the outcome.

38.Even if the income arising were double the official figure and the full cost assigned to inland fisheries were removed, public expenditure of this order on fisheries cannot be justified on economic grounds unless it were expected to result in a substantial downsteam industrial development in Ireland. The fact is that most of the expenditure relates to sea fisheries and the fishing fleet. Some of the latter are supplying factories in other countries and yet there are serious supply problems even for existing fish processing plants. This leads the Committee to the view that State expenditure in the fishing industry is not cost-effective as of now.

39.Though aquaculture may well provide the basis for optimism for the future, the Committee found that the proportion of the public expenditure programme on fisheries directed at accelerating this prospect is inadequate and extends far beyond the Department and agencies mandated with the fisheries programme, with the inevitable consequences of confusion, poor coordination and high costs with little to show for it.

40.The Sectoral Development Committee has already reviewed the fishing industry and a comprehensive report has been published by its Consultative Committee drawn from the industry. The Committee was aware that the Department of Fisheries and Forestry is preparing a White Paper and that BIM has prepared a development plan though neither of these documents were officially available in the preparation of this report. This report is designed to focus on the need for a greater return from public expenditure and how that might be achieved. It is therefore intended as a complement to those various industry reports.

6. IDENTIFICATION OF ISSUES

41.From the discussions the Committee had with officials of the three organisations primarily engaged in public expenditure on fisheries development and the preliminary assessment by the consultant, the following nine issues were considered the most important in relation to the Committee’s brief:-

42.These issues together with Training Programmes for the fishing industry, and the effects of the terms of the EEC membership were also considered and discussed by the Committee with the official agencies and representative organisations.

INVESTMENT IN INFRASTRUCTURE: HARBOURS

43.In its discussions with representatives of the Department of Tourism, Fisheries & Forestry, the Committee expressed concern about the lack of any systematic method by which investment decisions on harbours were appraised and about cost over-runs on harbour projects. Replies by Department officials indicated that a mixture of social and economic objectives served as criteria by which decisions were made concerning which harbour works should be undertaken in a particular year. At present the Department has no mechanisms whereby an escalation in costs as a result of inflation or unexpected engineering problems could either be controlled or used as a basis for re-appraisal of the investment decision. The situation also appeared to be made more complex by the involvement of the Office of Public Works acting as design and contract agents on behalf of the Department.

44.An analysis of the overall situation reveals these principal problems:-

Historical Background

45.A harbour development plan, drawn up in 1960 and based on the recommendations of Swedish harbour consultant, Mr. Carl Bjuke, listed eight ports which were suitable for development as major fishery harbours. The report also pointed out that smaller ports and landing places should continue to be improved in order to meet local needs. Subsequently, five locations were chosen for development as Fishery Harbour Centres. Under the Fishery Harbour Centres Act, 1968, the Minister for Fisheries was given responsibility for the management, control, maintenance and development of these harbours, with powers to appoint harbour masters and to collect landing dues.

46.Smaller harbours continued to remain under the control and management of the relevant local authority.

47.In 1968 a series of surveys was initiated by the Minister for Agriculture and Fisheries “to examine and report on the ports and landing places” in each county and “to make an up-to-date appraisal of the facilities required for the present and expected needs of the fishing industry, for tourism and sea angling, for communications and the landing of seaweed . . . .and to make recommendations as to the works to be carried out”. The survey teams included representatives of the Department of Agriculture and Fisheries, BIM, Bord Failte, OPW and the relevant County Council. A total of 874 such harbours and landing places were examined, and the teams took into account the variety of existing and potential uses of each harbour. It was envisaged that the County Councils would promote the development and improvement of these facilities, where appropriate, but unfortunately this process did not take place. While a few County Councils did provide funds for harbour improvement, most were unable to do so, and in many locations not even minimal maintenance was undertaken.

48.While a shortage of funds was undoubtedly a factor contributing to this neglect, the following factors also contributed:-

49.While such an attitude might be considered to work to the County Council’s financial advantage, the Committee considers that it is a wasteful and inefficient use of public funds. It obviously does not strike the optimum balance between capital and maintenance costs and the Committee believes it may have resulted in raising the specification for harbours and piers in the knowledge that maintenance will be inadequate.

50.The inevitable consequence of the County Council’s failure to fulfil their obligations to maintain, improve and develop minor harbours and landing places has been that the Department of Fisheries and Forestry has had to take the lead role in this area. Recognising that harbours serve other functions as well as fisheries (including ferries to islands for which the Central Development Committee, the Department of Communications and Roinn na Gaeltachta have responsibilities) the Department takes these into account in its “fishery assessment” by inviting other agencies, usually the local authority, to provide the additional funding. In any event, the Department is flexible in accommodating other users. This process has led to the present difficulties in appraising or evaluating investment decisions on harbours which the Committee has already noted in an earlier report.*

Relationship between the Department of Tourism, Fisheries and Forestry and the Office of Public Works

51.In the construction or improvement of harbours, the OPW act as design and contract agent for the Department of Fisheries and Forestry. The Department, having examined the project on the basis of its own criteria and assessed the development needs, provides firstly a “functional brief” for the OPW. This brief sets out the numbers and types of vessels to be accommodated, facilities required, etc. At this stage the Department has some idea of the benefits which will flow to the industry as a result of the proposed improvements, but does not yet have an idea of cost.

52.The OPW then examines environmental and site parameters including any siltation, erosion, state of any existing structures etc. and produces an outline design drawing which is then commented upon by the Department’s engineering staff. Detailed designs and costings are then prepared by the OPW. Frequently, as in the case of Howth Harbour, these do not allow for the unexpected. That case was further complicated by OPW’s statutory responsibility for the management and maintenance of the harbour.

53.Following approval of the design and costs, the Department of Fisheries and Forestry then seeks sanction from the Department of Finance. When this has been obtained, the OPW is instructed by the Department to proceed with the construction, the choice being left to the OPW whether to employ a contractor or to use direct labour. When direct labour is employed, the OPW then becomes the contractor, i.e. it functions as both architect and builder, a situation which has in the past given rise to problems. When a contractor is employed by the OPW, decisions regarding cost over-runs or variations are now made by the Commissioners for Public Works, and the client Department is one step further removed from the actual work in progress. Furthermore, it appears that the OPW did not, in the case of Howth Harbour, keep the Department fully informed of progress and difficulties on a day-to-day basis. On the other hand, the Department did not appear to be sufficiently strong in exercising its control over the OPW. It appears that until recently the functional brief provided by the Department of Fisheries and Forestry was not sufficiently detailed, and the Department frequently requested changes in the brief even after the works had gone to tender. In most such instances the Department was itself responding to local pressure and demands by fishermen and other harbour users. Actions or decisions by the local authority in respect of access or services have also been cited as the reasons for subsequent changes.

54.As already stated the events leading to the major cost over-runs in the Howth Harbour development scheme were examined in detail by this Committee. The conclusions drawn by the Committee in its review have general application to most harbour projects. Many of them are concerned with the relationship between the Department of Fisheries and Forestry and the OPW.

55.In making a general application of these conclusions, the Committee considers additional cost items must be justified either:

Difficulty of planning and carrying out capital works over two or more accounting years

56.Officials of the Office of Public Works indicated that considerable inefficiency and waste of human resources resulted from the difficulty of planning and carrying out capital works over a time-scale longer than the annual budget period. Estimates for harbour developments were requested, then postponed then requested again; and when instructions were given to proceed, an immediate start was required. Apart from the waste of time involved in re-calculating estimates, long-term planning or programming of the OPW’s own manpower and other resources became extremely difficult in such a situation. The recommendation of this Committee that capital budgets be based on a three year rolling plan would help to resolve these difficulties. In its report on the Control of Capital Projects, the Committee recommends that Government should make a commitment to the total funding of the Exchequer element of capital projects once they are approved.

Department of Fisheries Criteria for Assessing the Merits of a Harbour Project

57.According to the Department, all relevant factors are taken into consideration in assessing the merits of a harbour project.

58.The Department of Tourism, Fisheries and Forestry take the following factors into consideration in assessing the merits of a harbour project:

59.The above factors were stated in a letter by the Secretary of the Department to the Committee and the following additions emerged in the course of the Committee’s discussions with officials:

60.While a number of these factors cannot be quantified in economic terms, it should be possible to assign a scale of values to each one. A project may then be rated on each relevant scale, and the ratings added to given an overall assessment or priority. Provided that some degree of flexibility was embodied in the rating scheme to take account of changing circumstances, e.g., storm damage to a pier, such a scheme should enable the Department to plan ahead more effectively, provided always it is in a position to satisfy the requirements of the Department of Finance as set out in Circular 1/83, in particular to show that the payback was greater than the cost.

Lack of a National Port and Harbour Policy

61.Most harbours serve more than one purpose, e.g., commercial, fishing, recreation. The lack of a national policy on port or harbour development inhibits the rational consideration of harbours for multi-purpose use and prevents the development and application of more appropriate criteria for evaluating and comparing investment choices. A fundamental part of such a policy must be a decision on whether harbours and ports are to be considered as self-financing commercial operations or as infrastructure on a par with roads, sewerage etc.

62.The Second Programme for Economic Expansion (1964) took the commercial view:

63.It may be argued with equal validity that the benefits of harbour development flow to the region, that they are external to the operational economics of the harbour authority or board. Many of these economic benefits are identifiable only in a regional or hinterland context. This point of view seems to bear more directly on current practice than the statement in the Second Programme.

64.The Committee suggests that harbour development policy should be pursued in a framework which includes:

65.In that regard the Committee welcomes the statement “Reform of Local Government” by the Minister for Communications on a review of ports policy and trusts that it will include a consideration of harbour use by commercial fishing vessels.

INVESTMENT IN THE FISHING FLEET

66.In discussion with representatives of Bord Iascaigh Mhara the Department of Fisheries and Forestry and representatives of fishermen the Committee considered the sea fishing fleet, its requirements and the amount of State support which it receives.

The main points of concern to the Committee were:

BIM Marine Credit Plan

67.The BIM Marine Credit Plan is the principal vehicle by which State aid, in the form of grants and loans, is channelled to the development and improvement of the fishing fleet. It has operated since 1963. Until 1979 the repayments on the fishermens’ loan accounts with the Board were in credit by about 2%. Since then many owners of boats between 50 ft. and 90 ft. in length have fallen into serious arrears and substantial provision has been made by BIM for bad debts. The current indebtedness of the fleet is shown in Table 6.1.

Table 6.1 Current Indebtedness of the Fishing Fleet

68.According to BIM, unless there is a turn round in fishing vessel profitability, a significant additional number of boat owners will regress to a bad-debt situation. This is an aspect about which the Committee expressed grave concern. The reasons given by BIM for these problems are:-

Source: Sectoral Consultative Committee Report (1984)

69.The Committee is concerned however that none of these factors appeared to have been foreseen. While detailed analysis of the reason why the cost/price squeeze was not foreseen is beyond the scope of this report the following points are worth noting:

70.BIM officials informed the Committee that their current policy on 70-90 ft. boats is that they should be modernised, and converted to seine netting, long lining, or other types of white fishing. BIM will provide funds for modernisation on viable projects and boats may qualify for EEC and BIM’s own grant-in-aid package. Appendix IV sets out the details.

71.BIM informed the Committee that the 90-140 ft. boats are the newest, largest and most profitable vessels in the Irish fleet, capable of following the fish (primarily mackerel) from Cornwall to the North of Scotland. The Committee is concerned about the possibility of these vessels also getting into financial difficulties in the future.

72.From industry sources, it appears that the 90-100 ft. boats are already approaching financial difficulties. These are modern boats, equipped with refrigerated sea water (rsw) tanks, but limited to fishing herring, mackerel or sprat. During 1984/85 herring were in very short supply, while the mackerel failed to appear in their usual density off the west and north west coast of Ireland but remained concentrated off the Scottish west coast. Boats over 100 ft. in length have no difficulty in fishing economically at these distances, but they are at the limit of the range of the 90-100 ft. boats.

73.The dependency of all of these large rsw boats on mackerel also raises a question concerning their future viability. While their catching power and efficiency are impressive, there is uncertainty about how long the mackerel stocks will sustain the very heavy fishing to which they are at present subjected and the risk of lower EEC quotas. Thus the total allowable catch for EEC member states fell from 407,500 tonnes in 1984 to 385,000 tonnes in 1985, a drop of 5.5%, while Ireland’s quota was reduced from 85,300 tonnes to 80,000 tonnes, a drop of 6.2% in the same period. The viability of BIM loans on these boats may be further affected by quota limits in the very near future, if the trend on quota restriction is extended as is likely into 1986 and beyond.

74.In order to improve their viability a number of these 90-100 ft. boats have had their length and carrying power increased. This also improves sea-keeping qualities, and during re-fitting these boats were equipped with dry holds for white fishing, increasing their adaptability. In the case of the larger vessels, BIM provided technical assistance though they were excluded from providing financial assistance though these improved vessels should be sufficiently versatile and well managed to ensure their continuing viability in present circumstances.

Re-possession and Sale of Boats by BIM

75.The extent of the bad debts and the loss of public funds through loan write-offs was also a cause for concern for the Committee.

76.BIM’s loan arrears totalled £6m at the end of 1983. Loan repayments during that year reached only 51% of commitment (compared with 58% in 1982), and 13 vessels were either voluntarily surrendered by their owners or re-possessed by BIM. Bad debts amounting to £2m arose on the subsequent disposal of these vessels to other owners. During 1984 a total of eight vessels were either surrendered or re-possessed.

77.BIM policy is that re-possession is undertaken only as a last resort where all reasonable attempts within the power of the Board to assist borrowers have failed and where there appears to be no reasonable prospect of the vessel becoming viable. Every loan is restructured up to three times. This usually entails rolling up the interest and rescheduling the repayments. On occasions BIM has provided additional loans and grants for refurbishment or new gear in order to make the vessel more profitable. On no occasion has loan restructuring included any diminution of indebtedness.

The Role of BIM as a Lending Agency

78.It is clear from the foregoing that the role of BIM as a lending agency has for a number of reasons resulted in a loss to the Exchequer of over £2m in 1983 in the form of bad debts written off and arrears at the end of 1983 of £6m, leading, no doubt, to further write-offs in subsequent years. Furthermore, repossession and sale of boats by BIM resulted in adverse publicity for the Board and has given rise to tensions with the industry which, in the opinion of the Committee, reduce the Board’s effectiveness as the industry’s development agency.

79.For these reasons the Committee considers that the funds allocated by the Government to BIM for the development of the fishing industry would yield a better result for all concerned if the Board discontinued its role as banker to the fleet.

80.It also should remove the problem of uncertainty arising for fishermen where they seek grant or loan approval for boat types outside an approved scheme. These are referred first to the Department of Tourism, Forestry and Fisheries and then to the Department of Finance for consideration. This the Committee considers is an entirely inappropriate method of dealing with commercial investment decisions. It is understood that loans on vessels over 100 ft. in length are raised commercially against BIM guarantees. While guarantees may have no immediate cost the contingent liability may be greater than that arising from direct provision of credit and hence it is the view of the Committee that it should be provided by the Board only in very particular circumstances. One of the results of BIM loans and guarantees is that commercial credit is virtually unavailable for boats which because of their size, type or because they are second-hand are outside the scheme.

81.While the repayments record on BIM loans has not been satisfactory it can best be judged by comparison with the record of commercial banks on the recovery of farm credit in the same period. The circumstances of a shift in the ratio of prices and costs was common to both sectors, and in fact the bad debt record was approximately equal to a 10% default.

82.In considering the problems arising for BIM and the industry from this combination of roles of bank and development agency the Committee was conscious of the extent to which BIM was circumscribed as a State agency and was delayed in implementing prudent restructuring by the reporting systems through which it operates. BIM was also restricted in its development agency role in applying the EEC fleet modernisation scheme. This may in part have arisen because of its poor banking record as seen by the Department of Finance.

83.For the above reasons the Committee considers that further loans for the fishing fleet should be provided by other means and that existing loans should be phased out, possibly by establishing a marine credit union to which the loans would be transferred. This is a subject requiring closer examination by the relevant Ministers before an arrangement could be implemented but the need for such a separation of roles is evident both from the evidence of role conflict and the degree of circumscription applied to BIM in its banking role. Besides a bank relying exclusively on one sector would not be in a position to comply with the basic Central Bank requirements for a viable bank.

84.It will be argued that without BIM’s involvement in providing credit for the fishing fleet there will be no credit available and that fishermen will not support a marine credit union. If BIM were to transfer their existing loans to the new agency and fishermen were to continue to meet their repayments on schedule it would take little additional deposits from fishermen to provide sufficient resources to meet the borrowing requirements of the fleet. Credit would no longer be subject to particular schemes which exclude the most viable boat sizes and rescheduling where it was necessary could be undertaken without undue delay or reference to Government Departments

85.This in turn would leave BIM in a stronger position to look objectively at the status of the fishing fleet in relation to the overall development of the fishing industry and to tailor its grant package to engender the necessary response including the withdrawal of inefficient boats and the adaptation and grading up of others.

86.Just as it was argued that BIM’s commitment to boat-building is reflected in the fleet to the detriment of the fishing industry it might in future be argued that BIM’s commitment to providing credit facilities is reflected in the declining competitiveness of the fleet.

87.The Sectoral Consultative Committee on the other hand recommended a number of modifications to the BIM Marine Credit Plan which would transfer an additional burden to the State. Already up to 95% of investment in the ‘approved’ fleet comes from the State, so the Committee sees little prospect or merit in this approach.

88.The Sectoral Consultative Committee also recommended that loans for fishing boats or equipment should be in Irish pounds at low fixed rates of interest based on Eurocurrency loans with BIM carrying the exchange risk. The BIM aid package went some way towards meeting this more limited form of loan guarantee. It is an approach which has already been applied in other sectors by commercial banks including the ICC and ACC with mixed results and is accordingly not recommended by this Committee.

89.The advantage perceived by the Committee to arise from phasing BIM out of its banking role would be not merely to avoid bad debts but the clear segregation of the development role from the provision of a commercial credit service. In addition the removal of the irritant effect of the combination of roles on relations between BIM and the industry should result in a clear focus on a shared commitment to optimising the development of the industry and would be a major benefit.

AQUACULTURE SUPPORT AND DEVELOPMENT

90.The potential of aquaculture to contribute significantly to employment, wealth creation, regional development and exports has been recognised for over 20 years. The report “Science and Technology for Aquaculture Development” by the National Board for Science and Technology (1982) and the report of the Sectoral Consultative Committee on the Development of the Fishing Industry emphasised the need for co-ordinated development of this potential. This Committee examined the returns from State support to the industry and the disappointing results in industry growth to date.

91.The principal problem areas which this highlighted were:-

Returns on State Support for Aquaculture

92.In 1979, total aquaculture production in Ireland was approximately 4000 metric tonnes valued at more than £1.5 million (NBST, 1982). Dredged mussels and oysters and farmed fresh water rainbow trout accounted for 93% of the production by volume and 80% by value. By 1982, aquaculture production had risen to 7,500 tonnes with a value of £3.91 million (BIM: 1984), representing 3.6% of the total tonnage of fish landed and 7.5% of the total value. The production target for 1987 is 12,300 tonnes with a value of £11.84 million and rising to 5% of total catch and 20% of value before the end of the decade. The species with the greatest potential are salmon, rainbow trout, oysters and long-line or raft cultured mussels. Market growth and prospects are believed to be good in Europe, and opportunities exist for export worldwide.

93.State support for the industry has been small and fragmented. Total State and EEC investment in and aid to mariculture amounted to approximately £980,000 in 1981 (Sectoral Consultative Committee, 1984). In 1983, FEOGA grants to Irish aquaculture - marine and fresh water - amounted to £912,460, while BIM examined and approved for grant aid under the Mariculture Grant Scheme a total of 23 projects costing £89,364 (BIM Annual Report and Accounts, 1983). According to the Revised Estimate for the Public Service, published in 1985, Mariculture Grants disbursed by BIM during 1984 amounted to £352,000, and the estimate for 1985 is £557,000. These grants relate to the investment in fixed capital which is small. In most cases the real investment is in the working capital over the first two years. Unless the grant scheme recognises this aquaculture is effectively closed to small promoters.

In addition to direct grants and aids, varying proportions of the operating costs of BIM, the Department of Fisheries and Forestry, the Fisheries Research Centre, the National Board for Science and Technology, the Central and Regional Fisheries Boards, Udaras na Gaeltachta and the National Enterprise Agency have also been expended in developing the industry. It is not possible (from the published data from these agencies) to quantify the amount of public money involved. Hence, return on investment is impossible to determine. Furthermore, it is impossible to avoid the conclusion that the presentation of fishery statistics, and of statistics relating to aquaculture in particular, is seriously inadequate. Where figures for production or expenditure are provided they differ from agency to agency. For example, the figures given in the Fisheries Annual Report for 1982 do not appear to include rope-grown mussels or intensively farmed oysters valued at an additional £441,000 and which are shown in the BIM landings figures. The Fisheries Annual Report for 1983 gives a total of £87,298 for aquaculture grants given by BIM, whereas the Board’s own Annual Report and Accounts for 1983 gives a total of £89,364 for mariculture grants. These are two examples from many. The conclusion drawn by the Committee is that even the statistics on aquaculture suffer from the involvement of too many State-sponsored organisations with unclear or over-lapping responsibilities.

Lack of Co-ordination among the Support Services for Aquaculture

94.The Committee wishes to record its dissatisfaction with the lack of co-ordination in the various public expenditures on the development of aquaculture which cover the following areas of operation:-

95.These services are provided by a total of at least 37 separate bodies. A total of 15 official bodies was identified by the Sectoral Consultative Committee (Appendix 44 of the SCC report) but in order to provide a more realistic picture it is necessary to add the Youth Employment Agency, the National Enterprise Agency, Coras Trachtala and the Maritime County Councils (Donegal, Leitrim, Sligo, Mayo, Galway, Clare, Kerry, Cork, Waterford, Wexford, Wicklow, Dublin, Meath and Louth). A summary of their functions is given in Appendix 3.

96.While it is obvious that a single fish-farming venture would not need to contact more than a small proportion of these bodies in order to secure the necessary licences, permissions, and financial aids, nevertheless the multiplicity hinders the development of a co-ordinated approach to policy and to cost-effective deployment of public funds in the development of aquaculture.

97.This problem has been adverted to in the course of other reviews. The Sectoral Development Committee, echoing the views of the Sectoral Consultative Committees, recommended co-ordination by a small expert group reporting to the Department of Fisheries and Forestry and serviced by BIM as an interim measure before BIM would be given responsibility for aquaculture development. While such a move might help to improve co-ordination at government level, an example will show that the problem is more extensive.

98.Under section 54 of the Fisheries Act, 1980, aquaculture projects must be in a designated area and in accordance with a licence granted by the Minister for Fisheries and Forestry. In 1984 the Department held nine public inquiries around the coast in order, as required by the Fisheries Act, 1980, to designate areas for mariculture so that the applications for licences might then be considered. Only one designation was made. In most of the other locations there were objections by local authorities “to any interference with their activities at local level in relation to the level of purification of water and the discharge into marine waters of effluents of all kinds” (Dail Eireann, debate on Vote 35: Fisheries (Revised Estimate), 27 June, 1985, col. 2496, Minister for Fisheries and Forestry). To put the matter more directly, it seems that some County Councils, while apparently in favour of natural resources based development and job creation, opposed the designation of coastal waters for mariculture out of fear that they might be put under increased pressure to improve their sewerage discharges.

99.Following the objections by the local authorities and other interests in some locations, the Department held a series of informal discussions and is holding a further programme of public inquiries during 1986. These conflicts reflect the lack of any coastal resource management policy, and demonstrate a failure of co-ordination between the Department of Tourism, Fisheries and Forestry, the local authorities and the Department of the Environment. In terms of public expenditure, the cost to the State has been:

100.The report of the Sectoral Consultative Committee also drew attention to the long delays involved in the aquaculture licensing procedure as a result of two Departments (Fisheries and Communications) examining each licence - and recommended that the issuing of licences should be simplified. This Committee sees no reason why this approach should not be taken further to the concept of a “one-stop-shop” with a single agency responsible for processing all aspects of mariculture applications and liaising with other Government agencies on behalf of the prospective fish farmer. This Committee is of the view that this should be BIM’s responsibility. This should result in a saving of time and money and should remove some of the avoidable risks for this new high potential sector of the fishing industry. More especially it should result in public expenditure accelerating rather than impeding the development of aquaculture.

Improving the Existing Situation

101.The 1972 National Coastline Study laid the basis for coastal planning. This was not followed by the development of a coastal policy. Because of the increasing importance of the coast and coastal waters in economic activities, and the growing conflicts among a wide variety of uses, a small group representative of the various Departments and Agencies involved, with access to expert advice is now urgently required. Accordingly the Committee recommends that an interagency expert group be established and given the task of producing a draft policy for consideration by Government who should then assign responsibility for the implementation of coastal policy.

102.Meanwhile the Sectoral Consultative Committee’s recommendation charging BIM with overall responsibility for aquaculture should be implemented.

103.In recommending that BIM be given overall responsibility for the development of aquaculture, the Committee recognises the important role of the Central Fisheries Board and recommends that responsibility and authority be assigned accordingly. Fresh water fish farming is, of course, within the remit of CFB. With the new emphasis on salmon farming the licensing and control of development of its fresh water stage of smolt production should also be within CFB’s remit. This is necessary to ensure that this development does not threaten water quality or otherwise threaten wild fish stocks through disease and other risk factors.

104.In the course of this review of aquaculture the Committee became aware of the importance of adequate pollution control, and of the conflict of interest which it could pose for local authorities. It is, accordingly, recommended that the Central Fisheries Board have responsibility for ensuring water quality in the fresh water areas and that BIM carry that responsibility in the marine areas.

105.Because of the growing importance of aquaculture, its relationship both to fresh water and to sea fisheries and for other reasons to do with present accommodation the Committee recommends that consideration be given by BIM, CFB and the Department to relocation of CFB in BIM’s new office complext where ample space is available.

Scientific Research and Development

106.Fisheries research and development is an activity consuming a significant amount of public funds and showing signs of lack of co-ordination and duplication of effort. Its role in improving fisheries productivity and value added is an important one, and any inefficiency in this area is likely to have far-reaching effects. Research and development activities are manpower intensive. It is therefore important that the trained and skilled people who work in this field should have the proper resources and facilities, and should operate in an organisational structure which facilitates co-ordination and communication at all levels. Unfortunately, it seems to the Committee that this does not appear to be the case.

107.The Sectoral Consultative Committee identified the following problems in relation to marine fisheries research:-

108.The Sectoral Consultative Committee concluded that the present institutional structure for the conduct of marine research in Ireland is inadequate and inappropriate. Apart from the fact that much of the expenditure on fisheries and marine research is not yielding the results that might be expected, other necessary research and data collection in hydrography and oceanography are not being undertaken, and the benefit of a multi-disciplinary approach to the marine sciences is not being realised.

109.The Sectoral Consultative Committee recommends that a Marine Institute should be established as a State-sponsored body, its function being to integrate fisheries and marine research activities presently being carried out by various Government Departments and agencies. While its prime responsibility would be for fisheries and mariculture research, it should also have responsibility for oceanography, hydrography and the co-ordination of marine data. A key objective of the Institute would be to maintain close and active links with the industry, and to communicate research data and results to industrial users. The Consultative Committee proposed that the Institute should be controlled by a Management Board composed of representatives of Government Departments, semi-State bodies, industry and higher education institutions, and that specific programme areas of the Institute should be supported by Advisory Councils consisting of appropriate experts.

110.The Sectoral Development Committee did not wholly support these proposals, but recommended instead that the Department of Fisheries should establish an expert group representative of different interests in the marine area to examine and recommend on the most cost-effective institutional arrangements necessary to undertake marine research in Ireland.

Existing Structure and Costs

111.The Fisheries Research Centre, the Central and Regional Boards, Bord Iascaigh Mhara and the Salmon Research Trust are responsible for most of the fisheries research and development. All of them report to the Department of Fisheries and Forestry and their principal tasks and functions are outlined below. Other organisations not considered in this review but which also carry out some fishery research and development work include:

Fisheries Research Centre (FRC), Abbotstown, Co. Dublin

112.The FRC provides scientific advice to the Minister for Fisheries and Forestry and carries out a wide range of scentific work on both fresh water and marine species. Existing and future stock levels of some exploitable fish species are determined regularly, pollution levels in coastal and inland waters are monitored in certain areas, advice is provided, to the aquaculture industry, and fish diseases are monitored and investigated. The FRC has undertaken studies of the effect of arterial drainage on fish stocks and provides advice on the rehabilitation of affected rivers.

113.The FRC also provides Ireland’s input to the International Council for the Exploitation of the Seas (ICES), and much of the work of the marine side of the FRC is geared to meeting the requirements of the ICES Working Groups. Assessments based on this data are passed from ICES to a Scientific and Technical Committee which advises the European Commission on the Total Allowable Catch (TAC) of the various species for each Member State. The livelihood of fishermen depends on these TACs which also have a major influence on investment in the fishing industry.

114.Around 45 people work at the FRC, of whom 38 are scientific or technical staff. The operational expenses of the laboratory in 1984 amounted to £342,000, avery modest amount given the importance of its work.

Bord Iascaigh Mhara (BIM)

115.Research and development work undertaken by BIM covers exploratory fishing, gear technology, extensive mussel and oyster culture, and other applied resource development work. In 1983, the Board employed 40 staff (out of a total of 145) on fisheries development and spent £162,000 on technical assistance, exploratory and experimental fishing. In 1984 about £100,000 was budgeted for resource development work. These are also very reasonable amounts in relation to the value of the fishery resources exploited.

Central Fisheries Board (CFB)

116.Scientific research and development work carried out by the Central Fisheries Board is primarily in support of its functions under the 1980 Fisheries Act. The Board took over responsibility from the Inland Fisheries Trust for the management of trout, coarse fish and marine sport fish, and was in addition made responsible for salmon, sea trout and eels. Research undertaken by the Central Fisheries Board has been directly related to the task of developing and improving the fisheries for these species, and it includes a programme of environmental monitoring, sampling and analysis of pollutants, and investigations into the causes, effects of and remedies for eutrophication.

117.In 1984 the Board employed 11 scientific or technical staff out of a total of 160 which includes its own field staff and received assistance from those of the Regional Boards in undertaking surveys and research programmes. The nature of the Board’s accounts do not allow for an easy extraction of the cost of Research and Development. The Committee estimates it at about £220,000 with 705 of this being spent on the management and development of brown trout fisheries. This figure includes some expenditure by the Regional Boards in support of the Central Board’s research programme.

Regional Fisheries Board

118.The Fisheries Act, 1980, established seven Regional Fisheries Boards in place of 17 Boards of Conservators whose main task was the enforcement of fishery regulations. The functions of the Regional Boards include the protection and management of fisheries, encouragement and promotion of angling, and the preparation and regular review of a development programme for fisheries in each Board’s region. The Regional Boards’ officers carry out water sampling, and one Board possesses some basic analytical facilities. Support is also provided to the Central Board’s scientific staff during field work and development surveys. The Department of the Public Service have made recommendations on the reorganisation of this structure. The Committee sees no reason for further delay in implementing them.

Salmon Research Trust (SRT)

119.The SRT was established in the mid 1950’s to carry out research work on salmon and brown trout. It is sponsored jointly by Messrs. Arthur Guinness and Sons and the Minister for Fisheries and Forestry, and is under the control of a Committee of Management consisting of a chairman, two nominees of Arthur Guinness and Sons, two nominees of the Minister and two elected members. It will very shortly come under the complete control of the Department of Fisheries and Forestry.

120.The SRT has so far determined its own research programme and has made substantial contributions to our knowledge of the biology and genetics of salmon and sea trout.

121.The Trust received £60,000 from the Department of Fisher is and Forestry in 1983.

Costs

122.The Sectoral Consultative Committee estimated that 93 people are engaged in research work on fisheries in the Department and semi-State bodies, and that the expenditure on research in 1983 was IR£1.8m made up as follows:-

The Committee’s estimate for the agencies directly involved in this review is as follows:-

123.There are significant differences between some of these estimates, but they indicate the order of magnitude of the sums involved. It is clear, however, that better information on State expenditure on fisheries research and development is needed.

Structural Problems

124.Our sea or inland fisheries cannot be considered to be fully developed, and thus there is all the greater need to ensure a continuing input of applied research. The management of fisheries, protection from pollution, and (in the case of sea fisheries) ensuring that Ireland receives the best possible quotas of the total allowable catches also require an on-going research input.

125.If research and development staff are not working most effectively for whatever reason, if the £2.5m of public funds allocated is not being spent efficiently, or if there is overlapping or duplication of work, or information is not being freely exchanged, then public expenditure on fisheries research is not as cost-effective as it should be.

126.Unfortunately, some of these inefficiencies and difficulties are present. Indeed the recent Department of the Public Service Management Unit report on the Central and Regional Fisheries Boards identified many of them but for whatever reason these recommendations have not yet been implemented. The result is that problems and inefficiencies continue even after the solutions have been identified to the satisfaction of the agencies involved.

Fragmentation

127.The number of agencies engaged in fishery research or in work directly related to fisheries, (e.g. water quality surveys, eutrophication studies, etc.) highlights the problem of fragmentation. This Committee’s review identified the following list of state agencies involved and is not necessarily exhaustive.

(a)Department of Fisheries and Forestry, Fisheries Research Centre, Abbotstown, Castleknock Co. Dublin and Forestry and Wildlife, Bray.

(b)Central Fisheries Board and the Regional Boards.

(c)Bord Iascaigh Mhara.

(d)Salmon Research Trust of Ireland, Inc.

(e)The Electricity Supply Board.

(f)Third Level Educational Institutes (includes the Universities, the NIHEs and some Regional Technical Colleges).

(g)An Foras Forbartha.

(h)Institute for Industrial Research and Standards.

(i)An Foras Taluntais/Department of Agriculture.

(j)Department of the Environment.

(k)Údarás na Gaeltachta.

(l)Commercial Aquaculture Ventures.

(m)Bord Fáilte.

(n)Foyle Fisheries Commission.

(o)Economic and Social Research Institute.

(p)Office of Public Works.

(q)National Board for Science and Technology.

(r)Local Authorities.

(s)Trout Anglers Federation of Ireland Heritage Trust.

128.While there is a considerable amount of co-operation at personal level, the inevitable competition for scarce State funding inhibits free exchange of information. Even in the absence of competition, information exchange proceeds with difficulty. For example, while the Department has been carrying out research on salmon and sea trout for many years, this information was not given to the Regional Boards nor were Department personnel involved in drawing up regional programmes for these species. The DPS Management Services Unit commented on the lack of co-operation and co-ordination in this area.

129.In addition, some of the organisations listed above are not under the control of the Department of Fisheries and Forestry or have only sporadic contact with the principal agencies engaged in fisheries research. The fishing industry has been very critical of the waste of resources implicit in the number of individuals and agencies with which it has to deal. The Committee reflects the concerns of the industry and believes that the problem results in a poor return from public expenditure.

Uncertainty of Roles and Functions

130.Closely linked with the problem of fragmentation is that of uncertainty. For example the Committee noted that the Fisheries Research Centre has not had the benefit of an agreed document or “Charter” defining its functions.

131.The Central Fisheries Board is in a similar position of uncertainty. Following its establishment under the 1980 Fisheries Act, it received no brief from the Department of Tourism/Fisheries and Forestry on its research role, nor did the Department take the opportunity to define the nature and limits of the research work to be undertaken by either the FRC or the Central Board. Also, despite a considerable increase in the powers and responsibilities given to the Central Board over and above those exercised by the former Inland Fisheries Trust from which it evolved, the Board received no additional staff or facilities. The Board, in the course of 1985, prepared a series of draft programmes and policy documents on the main fish species and on the aquatic environment defining a research and development role for itself. They await the agreement of the Department without which no action can be taken.

Absence of a Research and Development Policy within the Fishing Industry

132.The Committee notes with regret that the fishing industry spends a negligible fraction of its turnover on research or development activities, and that fraction is confined to aquaculture. Indeed, with the exception of a small number of aquaculture ventures, the industry, in contrast with the food industry, employs no scientists.

133.This illustrates both the dependence of the fishing industry on State support and its degree of under-development. The Sectoral Consultative Committee report was a valuable initial step in identifying the problem since the industry was well represented on the Committee. The expert group recommended by the Sectoral Development Committee (Report and Recommendations on the Sea Fishing and Aquaculture Industry, paragraph 53) could, if established, carry this task further. A more significant step forward would be for the industry to address its own research needs and to fund and undertake, either independently or jointly with a State agency, some research projects. While this approach may prove difficult for reasons of competition the industry should recognise the extent of its stake in a soundly based research and development programme and should not be satisfied to leave it entirely to the public sector. To create the structure in which this could be achieved would first require a rationalisation of publicly funded Fisheries R and D Programmes.

Advisory Role

134.Both in the FRC and the former Inland Fisheries Trust individual scientists were assigned to particular species for many years. While the benefits in terms of specialist expertise are obvious, this arrangement also led to protracted research programmes which have often run on without question as to their relevance. Absence of project selection and control systems also meant that the choice of fish species being studied did not always reflect their relative importance.

135.At the FRC this problem has been attacked by the introduction of a formal research project budget proposal procedure. Each project is classified, given an objective, justification and cost by the researcher proposing it. As a result, the choices made between competing projects can be justified and re-examined if necessary, while long-term work is also re-evaluated at suitable intervals. The system is new and fairly simple, and might benefit from assessment or comparison with the ARMIS (Agricultural Research Management Information Service) procedure developed by An Foras Taluntais.

136.A direct input from industry to the selection of R and D projects through industry advisory groups would also ensure that the research projects supported were relevant and likely to be applied.

137.The nature of the work is such that basic research and data collection may at any time lead to applications of economic importance, and the development work required to maximise thepotential of new or improved fisheries may identify problem areas requiring fundamental research.

138.The Committee believes that the present separation of “research” and “development” roles is no longer appropriate. In marine fisheries, the development role resides with BIM which has no research facilities.

In fresh-water fisheries the Central Fisheries Board and the Regional Boards have the primary developmental role; the Central Board possesses some research capabilities while the FRC and the Salmon Research Trust have greater research facilities but are separated from the day-to-day management of the fisheries. In aquaculture there is considerable confusion and overlapping.

139.In practice, these distinctions result in such anomalies as a scientist in a “development” role being prohibited from carrying out much needed investigation of some aspect of the biology of the species under his management.

140.Similarly, a scientist who is an expert on a particular species in a “research” role may be prevented or inhibited from contributing to the development or improvement of the fishing for that species. The Committee believes that integration of both functions would make for greater efficiency.

Separation of R and D between Marine and Fresh-water Fisheries

141.The SCC report dealt exclusively with sea fisheries. However, marine and fresh-water research and development share many facilities, ideas and techniques. Separation, even if it were feasible and desirable would inevitably lead to duplication. Since marine and fresh-water fishery scientists work on different species (with the exception of salmon, sea-trout and eels which are migratory) there is less need for formal contact, but certain resources - particularly library, vehicles, some equipment and basic analytical and computing services - can be shared. In the case of salmon and other migratory fish, full integration of inland, estuarine and marine research, development and management programmes is essential.

142.In the present structure, there is some degree of integration at the FRC, but this does extend to the other agencies involved. The Technical Co-ordinating Committee on Salmon established in 1984 by the Department has encouraged further integration.

Lack of Resources

143.Nearly every scientist or scientific administrator in charge of an R and D programme will seek further funds, staff and accommodation in order to obtain the results or data required. In most cases the allocation of further resources will indeed enable the job to be done more quickly, but not necessarily more efficiently.

144.The Committee was informed that in the case of fisheries R and D, staff and accommodation shortages at the Central Fisheries Board and the FRC have prevented existing staff from using their time efficiently and have jeopardised certain essential programmes. It was further stated that budget cuts, particularly in relation to non-pay items, have resulted in some highly qualified scientists doing work more appropriate to laboratory technicians and being unable to travel to various parts of the country to carry out field work. It was also stated that the loss of technicians under the recruitment embargo has led to problems of cost-effectiveness and lack of data. Rationalisation will, in the opinion of the Committee, contribute greatly to a resolution of these problems.

Inland Fisheries Research and Development

145.The Committee considers that the fresh-water fisheries group within the FRC should come under the management of the Central Fisheries Board which should be given responsibility for co-ordinating and integrating research and development in inland fisheries. This will bring R and D activities closer to the day-to-day management of the fisheries, with the advantage of a field staff covering the whole country.

Marine Fisheries Research and Development

146.The marine fisheries R and D team within the FRC should come under the management of BIM which should be given responsibility for co-ordinating and integrating research and development in marine fisheries. This recommendation is based on the committee’s belief that a sound data base and a proper balance between conservation and exploitation are essential to stability and development in the fishing sector. This can only be achieved by proper synchronisation of the industry’s research and development programmes.

Recommendations

147.The Committee considered the recommendations of the SCC for the establishment of a Marine Institute and of the SDC recommendation for the establishment by the Department of an expert marine group to make recommendations.

148.It also considered the more immediate and practical problems which are dissipating the impact of the scarce resources now applied to fisheries research and development and frames its recommendations to the following ends.

-That Fresh Water and Marine Fisheries research should not be separated but more comprehensively integrated. Because of the narrower mandate of the SCC and SDC reports which were focused on sea fisheries the danger in their recommendations is that this could be overlooked.

-That Research and Development should at this stage be closely integrated since the Irish capacity to monitor, conserve and exploit the full range of species in our waters will determine the extent to which we can benefit from the next European Fisheries Policy regime which will commence in 1993. It may well be that a Marine Institute combining all aspects of Marine Research may be the right solution in the longer term, but the problem is pressing and should be tackled by the best redeployment of existing resources.

-That the DPS recommendatiosn in the Central Fisheries Board be approved for implementation without further delay.

-That catch statistics be included as part of the scientific data base and treated as such.

149.It is recommended elsewhere in this report that aquaculture development be assigned to BIM. This is an added reason why marine fisheries research should become part of the BIM remit rather than a separate institute or an executive unit under the Department.

Migratory Fish

150.The existing co-ordinating committee on salmon should be supplemented if necessary by other expertise, and its brief extended to include sea trout and eels, and should be serviced by the FRC in Abbotstown.

Accommodation and Fresh-water/Marine Integration

151.The existing accommodation shortages at the FRC and the seriously inadequate accommodation of the Central Fisheries Board should be solved by an extension to the present laboratory at Abbotstown. The alternative of relocating CFB at BIM headquarters would have the advantage of combining the two fishing development organisations at one location without the need for additional public expenditure on buildings. This is the option this Committee would wish to have pursued.

Role of the Department of Tourism, Fisheries and Forestry

152.The Department should retain responsibility for R and D co-ordination and policy but should relinquish the operating responsibility for R and D programmes. The Department would then be in a position to commission research from the CFB or BIM (jointly or severally).

Liaison with Industry

153.An advisory committee, along the lines of the expert group recommended by the Sectoral Development Committee should be established to provide direct liaison between industry and the R and D activities of the CFB and BIM.

Statistical Data

154.Before concluding on Research and Development Expenditure the Committee considers it necessary to draw attention to the poor data base for the industry. The system employed by the Department of Tourism, Fisheries and Forestry of collecting data on fish landings is entirely unsatisfactory either as a basis for setting quotas, determining conservation needs or exploitation opportunities or for enforcing licensing and quota regimes. It also has the effect of undermining the credibility of good data and rendering enforcement cost ineffective.

155.The ESRI report on the Development of the Sea Fishing Industry highlighted these deficiencies in 1980 and made recommendatiosn including the requirement of a Ministerial order under the Statistics Acts.

156.The Committee considers that cost effective systems based on statistical sampling rather than a full count should be the basis on which the ESRI recommendations of 1980 be implemented. This will require the involvement of the Central Statistics Office. It may not observe the letter of the EEC requirement but it would be a major improvement on the present system.

157.This Committee would wish to see these recommendations implemented as quickly as possible and a review undertaken by the Management Services Unit of the Department of the Public Service in course. Having recently reviewed the operations of FRC, CFB, the Regional Boards and the Department of Fisheries, such an assessment should be of great value.

QUALITY STANDARDS

158.Responsibility for ensuring fish quality is split between the Department of Tourism, Fisheries and Forestry and the Department of Health. The former enforces the handling, storage and transport regulations for demersal and pelagic fish and for shellfish, while the Department of Health enforces the food hygiene regulations. The Department of Tourism, Fisheries and Forestry employs 12 Fish Quality Officers, but they are involved principally in the certification of fish withdrawn under the EEC scheme and not in enforcing the regulations.

159.Fish exporters are not licensed (though an attempt was made in 1973 to establish a licensing scheme) and there is no control or licensing of processing plants apart from the standard public health and food hygiene regulations.

Enforcement

160.The Sectoral Consultative Committee, which examined the question of quality control, concluded that the regulations governing quality and hygiene are not being enforced due to a shortage of inspectors and that the limited certification of exports to meet the legislative requirements of importing countries was disorganised and ineffective.

161.Quality standards at the wholesale/processing stage were also shown to be less than satisfactory in a study carried out by BIM, in 1983. Problems included lack of grading, poor temperature control during transport and poor packaging. Processed fish products, which have to face severe competition from imported products, observed quality standards better. The Sectoral Consultative Committee concluded that poor quality in handling, grading and presenting fish was endemic and threatened the viability of the industry. As with other consumer products the Committee believes that the relevant Department should enforce standards.

Additional problems facing Exporters

162.Coliform contamination of shellfish-growing waters seriously affects the quality of the shellfish from a public health point of view. While there is no legal standard in Ireland for the coliform content of shellfish, a guideline proposed by the National Board for Science and Technology is in general use, and has been applied by the Health Boards in issuing certificates for shellfish destined for consumption in this country. Health Boards do not certify for export, and so the Department of Tourism, Fisheries and Forestry has therefore established its own system for providing certificates. There is no guarantee of course that such fish in fact goes for export or that it complies with the guidelines applied by the Health Boards.

163.Fish processing plants are not yet subject to inspection and licensing for export, as applies in most other food plants, before being allowed to export. This is an additional task for which provision must be made as fish exports develop.

164.The Sectoral Committee’s recommendations are summarised below. This Committee urges that they be implemented with appropriate industry involvement and without additional public expenditure.

165.This Committee adds the recommendations that the licensing and inspection of fish marketing and processing premises should be integrated into the licensing and inspection system of the Department of Agriculture including its levy system for other food export premises and that BIM be charged with responsibility for aquaculture including improved water quality in shellfish growing waters. The Department of Tourism, Fisheries and Forestry would however have prime responsibility for ensuring that regulations governing quality were observed at the primary handling stage.

MARKETING, PROCESSING AND ADDED VALUE

166.The Committee questioned representatives of the Department of Tourism, Fisheries and Forestry and Bord Iascaigh Mhara and industry interests on home and export marketing strategies and on the proportion of the fish landed which is exported unprocessed.

167.It emerged that in all three areas the industry had made considerable strides, with the encouragement of BIM, and that every opportunity is taken to develop additional markets and to increase the proportion of fish processed. Unfortunately, there are significant barriers which will take some time and effort to overcome.

The Domestic Market for Fish

168.Domestic consumption of fish had grown by nearly 21% between 1976 and 1982, i.e. at an average of 3.5% per annum. Allowing for the growth in population, this represented an increase in per capita fish consumption from 5.17 kg in 1976 to 5.78 kg in 1982, i.e. an average annual growth rate of nearly 2%. Yet Irish consumption is lower than in most European countries, though comparable to West Germany and the U.S.A. Import penetration has unfortunately also increased over the same period, from 39% by volume in 1976 to 45% in 1982. Thus nearly half of the fish we eat in Ireland is imported. A 1983 BIM survey identified £16m of these imports as being substitutable.

A programme of action recommended by BIM to expand the market has been endorsed by the Sectoral Consultative and Sectoral Development Committees in their reports. However, no arrangements were considered for the industry to contribute to the cost of this programme or to counter the benefits imports can derive from the programme. This Committee considers it vital that the industry be involved financially and in an advisory capacity in shaping this programme.

The Export Market

169.The Committee examined BIM’s role and approach to export marketing and the number of people involved in market promotion overseas. BIM appeared to assign similar numbers of staff to both home and export markets, even though 85% of the catch (by volume) is now being exported. Of BIM’s total marketing force of 18, only two are based in Europe. The remainder operate from Dublin as BIM considered this was the most cost-effective way of operating. This programme has been under review by a special group under the chairmanship of the Minister of State for Fisheries in the course of the last year.

170.There has been substantial growth in the volume and value of fish exports in recent years, which amounted to 85% of catch or 176,000 tonnes valued at £72.8m in 1982.

This strong export performance which doubled exports in four years is due mainly to the increased mackerel landings and the developments of exports of whole frozen mackerel to new markets in West Africa and elsewhere. In 1982, total mackerel exports amounted to 118,900 tonnes valued at £29.7 million compared with 8,000 tonnes in 1978 valued at £1.6 million. But this is a “commodity” market, with prices determined internationally. This fact and the pressure on supplies and sharp decline in EEC export refunds takes some of the gloss from this export performance.

171.The Sectoral Consultative Committee identified the principal constraints to the further expansion of fish exports and concluded that a new marketing strategy was needed. The Sectoral Development Committee recommend that BIM should continue to exercise the lead role in export promotion, drawing where necessary on the resources and expertise of Coras Trachtala (CTT). The SDC also recommended that the links between BIM and CTT should be further strengthened, and that BIM should establish an export marketing committee drawn from exporters. This Committee supports such an approach and urges early implementation with provision for co-funding export promotion and development costs.

Processing and Added Value

172.There are 75 firms involved in fish processing employing 1,500 people and predominantly engaged in primary processing i.e. whole freezing, gutting, filleting and bulk salting. It is estimated that less than 20% of the fish handled by processors is converted to higher valued products. The increased landings of mackerel (which are exported unprocessed) are partly responsible for these very low percentages. Constraints on the development of the processing industry are lack of continuity of supplies, poor quality of supplies, and poor and uncoordinated marketing. Yet given the high value of fresh (and even live) fish it should be recognised that processing is not the ultimate objective for all fish. In fact, 35% of fish is now sold in its highest value form though perhaps only 12% is processed.

173.The Sectoral Consultative Committee identified further processing opportunities and pointed to the need for “a substantially expanded level of financial and non-financial help from the State agencies”. The Sectoral Development Committee recommended that the IDA, in consultation with BIM, should continue to have primary responsibility for the development of fish processing.

174.This Committee in supporting the recommendations of the Sectoral Development Committee recommends that any consequential adjustments necessary are made within BIM to reflect its consultative role. In particular the Committee recommends that BIM concentrate on improving fish supply arrangements for processors through the promotion of supply contracts, equity participation and other means.

175.In recommending the introduction of a levy towards the cost of BIM’s domestic Market Promotion Programme and a co-funding arrangement on export promoters, the Committee recognises that further changes may arise within BIM since some activities may not warrant or command financial support from the relevant contributing interests in the industry.

176.The Committee also considers that fish processing plants should, like other food export plants, be licensed and inspected to meet international market requirements and that is most likely to be cost-effectively undertaken by expanding the Department of Agriculture inspectorate of other food plants and by extending that levy system.

177.Quality improvement is an industry responsibility. With support of the Irish Quality Control Association, a satisfactory licensing and inspection system and their involvement in the funding of BIM’s domestic and export market programmes these problems should be addressed quickly without any requirement of public expenditure, provided the Department sets and enforces standards satisfactorily at the primary handling level.

FISHERY PROTECTION

178.While there can be some argument as to whether the cost of fishery protection can be properly ascribed to the fishing industry it is borne by the Irish taxpayer and should be of benefit to no other. In real terms, including administrative costs and some gesture towards the cost of servicing the related capital programme, fisheries protection costs are in excess of £20m.

179.This relates to the cost of protection of 25% of EEC fisheries while Irish fishermen enjoy the opportunity to the extent of only 4.6% of EEC fish quotas. Hence it would seem that the maximum amount of the cost of fishery protection attributable to Irish taxpayers in protecting Irish fishermen should be less than 20%, being the proportion of the benefit open to Irish fishermen. Irish taxpayers have in fact carried 36% of the capital cost of the protection fleet, 100% of the capital cost of the Air Corps equipment and 100% of all operating and administrative costs.

180.The Committee recommends that in future negotiations, if Irish quotas cannot be increased in proportion to protection expenditure, protection expenditure should be apportioned in proportion to quotas, with the balance paid by way of grant from the EEC. This is provided for by the European Council agreement of October, 1976 and properly applied should result in a saving of £16m per annum in today’s figures to Irish taxpayers.

SALMON

181.As the following graph shows the consequences of over-fishing is now being felt even at sea. Some rivers have been denuded of salmon and income from angling tourism has been in decline over the past 4 years.

182.The present regulations designed to protect wild salmon stocks seem to do more to incur significant public expenditure and the wrath of fishermen. The main economic significance of this failure is the resultant threat to angling tourism, the value of which is estimated by Bord Failte at £37 million. Of this £9.4m is estimated to derive specifically from salmon angling.

183.The Committee received detailed submissions from the IFO, the Inshore and Estuarine Salmon Net Fishermens Association and the Central Fisheries Board. The Committee considered alternatives such as a shorter fishing week, a quota with shorter seasons and a form of salmon tagging by licensed salmon fishermen and dealers.

Fig 1. Volume of salmon landed by different methods of capture 1952 - 1985

Fig. 2 Total Salmon catch (tonnes)

Moving 5 - Year Average 1954-1982

184.The Committee is not competent to adjudicate on the possible alternatives but is satisfied that the present system does more harm than good and costs money. Therefore some alternative which could command the support of fishermen should be considered by the Minister before reverting to the only other alternatives of more rigorous enforcement or banning salmon at sea.

185.The Central Fisheries Board has reviewed salmon management systems world-wide and have the expertise to advise. This is an urgent matter of managing a natural resource which has enormous potential and is at immediate risk. In seeking to devise a new system consideration should be given to the following:-

-there has been a dramatic shift in the proportion of salmon caught in the rivers, in the estuaries and at sea.

-Illegal fishing, including fishing beyond the 12 mile limit, accounts for a big proportion of the catch.

-The consequences of the dramatic rise in catches throughout the 70’s must now be addressed. Recognising the growing importance world wide of tourism requires that a means be found of enforcing effective quota restrictions which will have regard to the requirements of individual river stocks.

-The Naval minesweepers now used to patrol sea fishing of salmon are inefficient, obsolete and cost ineffective.

-The efforts by the ESB and others to restock rivers by means of ranching smolts have been largely unsuccessful in rehabilitating wild stocks. This gives a new importance to effective enforcement of controls on sea fishing of salmon.

-The present licensing and control systems are honoured more in the breach than in the observance and despite the cost and stress involved for all concerned have no value in protecting salmon stocks in our rivers.

-Abuse of the present system confers greater advantages for the bigger boats while fishermen object to conservation restrictions which involve uneconomic fishing techniques.

186.For these reasons the Committee is of the view that the National interest is served by gaining the goodwill of fishermen in reducing the catch of salmon at sea and ensuring that the salmon stock in every river can recover to satisfactory levels. This might be achieved by assigning reduced quotas in specific areas to fishermen who would tag their catch up to the assigned limit after which they would withdraw from salmon fishing for the season. It cannot be achieved by the present system.

187.Effective implementation of such a system is essential not only to good order among fishermen but also in protecting the prospects of the £37m. angling tourism business and in protecting the fish processors and wholesalers against those who trade in illegally caught fish.

188.The Committee considers that the present system is a serious threat not only to salmon stocks but also to fishermen, angling tourism and to legitimate salmon processors and traders.

189.It accordingly recommends that as a matter of the greatest urgency a new system based on quotas and tags designed to win the willing participation of fishermen be got in place before another distinctive national resource is extinguished as it has been in most of the major rivers in Europe.

190.But illegal fishing, though the main threat, is not the only threat to salmon stocks. Major drainage schemes have been undertaken on many of our rivers with a view to lowering the water table and the risk of flooding on adjoining agricultural lands. Where the river beds are not rehabilitated with sand and pebbles to make a suitable breeding ground for salmon that river salmon stocks are as effectively destroyed by the Office of Public Works as they might otherwise have been by illegal fishing.

191.This Committee urges that river bed rehabilitation be incorporated as an essential part of drainage schemes where in the opinion of the Central Fisheries Board it is necessary for the maintenance of fish stocks.

192.The output of farmed salmon is now equal to the Irish salmon catch of wild fish. Wild salmon as a proportion of total output will continue to decline. Salmon farming by increasing supplies of salmon will undoubtedly help to reduce pressure on the wild stocks, by reducing prices.

193.Salmon ranching is also practised in other countries with very good results. This involves establishing hatcheries and releasing the smolts to their natural feeding grounds rather than holding them in cages at sea.

194.If properly managed, salmon ranching would dramatically increase the stocks of fish available for fishermen. However successful ranching presupposes strict control over the interceptory fisheries for salmon. When combined with salmon and even with substantially reduced prices well managed and balanced salmon management systems have the potential to contribute enormously to fishermen and to the economy.

BIM

195.BIM is the agency charged with responsibility for charting the direction of the fishing industry and providing the supports, the services and incentives. Over the years BIM has been involved in fish retailing, ship-building and fish processing and many other activities which it has shed as the industry developed its own infrastructure. It is now involved in ship-surveying, fish marketing and promotion, banking and provision of ice on quays. Each of these functions should devolve on the industry or on other commercial agencies as appropriate as the industry develops further.

196.This will allow BIM to focus its mandate on effecting the changes and adaptations necessary within the fishing fleet to respond to competition and changing markets, quotas and technology and to take on the lead role in the promotion and development of Irish aquaculture. This will require a strong footing in Research and Development which is the subject of separate recommendations.

197.It will also require a clear mandate on aquaculture which hopefully will be provided in the Fisheries White Paper since there are over a dozen Government agencies involved.

198.There are many other aspects of BIM’s role which the Committee considered and on which recommendatiosn are made in this report, including research and development, aquaculture, marketing, credit and training.

199.With such a diverse range of activities within one development agency it is essential that the agency enjoys the confidence and the goodwill of the industry and that the range and depth of its own management skills gives it the capacity to be both adaptable and developmental.

200.The Committee supports the recommendations of the Sectoral Consultative Committee that BIM should be given primary responsibility for the development of aquaculture. Furthermore it adds that primary responsibility for Sea fisheries research should be assigned to BIM rather than to a separate Research agency.

201.To ensure that these new responsibilities can be undertaken the Committee urges a reappraisal of BIM’s role in marketing, a withdrawal from the provision of credit and clarification of BIM’s consultative role with IDA in relation to fish processing.

202.Furthermore with a view to ensuring the greatest possible prospect of success for BIM in its new role the Committee recommends that a major evaluation of the organisation is commissioned so that the necessary reorganisation can be undertaken to fit it for its new role.

Inland Fisheries

203.The consistent fall over recent years in the number of angling participants among tourists and the consequential fall in tourism revenue has raised the Committee’s concern over the management of the National angling resources.

204.The number of anglers has fallen from 1982 to 1984 by as much as 20% to a figure of 225,000 reflecting a drop in tourism income arising in that year to £37.2 million.

205.Because of the obvious benefits arising from the maximisation of tourism, and the uniqueness of Irish angling facilities and the importance of angling to tourism, the Committee gave special consideration to the views of the Central Fisheries Board, its regional boards, the Trout Anglers Federation and other angling and inshore fishing interests.

206.The recommendations elsewhere and particularly relating to the Central Fisheries Board and the management of salmon reflect this and are geared to ensure that the existing resources available to inland fisheries can be more cost effectively applied by implementing the DPS Management Service Unit’s recommendations on the organisation of the Central Fisheries Board, changing the Salmon Management System as proposed, rehabilitating river beds as part of the drainage programmes and giving responsibility to the Central Fisheries Board for fresh water fish research, pollution control and inland aquaculture.

207.The Committee considers that it will also be necessary to achieve the closest cooperation between the Central Fisheries Board and Bord Fáilte to coordinate the preparation and the marketing of this special tourism resource which is now unique in Europe. This should not require additional Public Expenditure if all the recommendations are implemented as this will

208.The Trout Anglers’ Federation submit that an additional expenditure of £2m is necessary to increase the non-pay budget of the Central Fisheries Board so that it can improve stock levels, access signposting and the information base on which the promotion of angling as a special tourism package can be undertaken.

209.Strengthening the tourism earning potential of fishing will become increasingly appropriate and feasible as due to EEC directives and other pressures public expenditure on environmental protection is increased.

210.Accordingly the Committee urges now that the Departments responsible for fisheries and tourism are for the first time combined, that a policy of developing inland fisheries as a major national resource for exploitation as a national amenity and for tourism be developed and that an appropriate programme be implemented through the Central Fisheries Board.

7. SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

211.The Committee believes that there is every reason for concern about the cost-effectiveness of the £40m plus of public funds allocated to the development and protection of the fishing industry. This figure does not include capital grants and other payments made from public funds to aquaculture or fish processing projects through IDA, Udaras na Gaeltachta, SFADCo, YEA, AnCO and other organisations. Nor does it include expenditure of public funds by other agencies of the State who undertake fisheries research and development work such as University College, Galway, NBST and others or certain administrative costs. Excluded also are the debt servicing costs where the programmes give rise to borrowings.

212.The fact is that the industry is constrained in its total catch by European Community Policy and the capacity of the fleet to compete with larger vessels with greater range and economies of scale.

213.Evidence of the effect of these constraints is found in the number of boat owners on whom BIM has had to foreclose in recent years and the number who are now in arrears on loan repayments. In proportionate terms it represents a problem equal in scale to that which hit Agriculture since 1979.

214.Recognition of the limitation on catching capacity should shift the focus of development policy off increasing fleet capacity towards aquaculture, identification and exploitation of non-quota species and promotion of fish processing. The structures of the State agencies involved however seek to militate against this shift. In particular fragmentation of the R & D programme, poor and uncoordinated quality control and plant and product inspection and the involvement of the key fisheries development agency BIM as banker to the fishing fleet make it very difficult for state expenditure on fisheries development to be adaptable and therefore cost-effective in changing circumstances.

215.In putting forward recommendations the Committee is conscious of the more detailed and expert reviews undertaken by the Sectoral Consultative Committee. The Sectoral Development Committee endorsed many of their recommendations. But the Committee’s brief differs in that it covers both inland and sea fisheries and concentrates on better value for the State expenditure involved.

216.From the point of view of cost-effective public expenditure in support of fisheries development the following recommendations have particular urgency. They may not affect the level of public expenditure on fisheries immediately but should increase the impact in terms of the capacity of the industry to create substantial jobs in all aspects of the fishing industry. Expenditure would then be reduced as a proportion of income arising and in absolute terms as aquaculture is provided with the preconditions to sustained economic growth.

217.The build-up in the fleet capacity and the catch was quite dramatic in the ’70s. Unfortunately, it came so late that Irish quotas (4.6%) represent such a small proportion of the total in these waters as to seriously limit the potential of our fishing fleet compared with what it might otherwise have been. Nevertheless it is worth giving some attention to building up catch patterns in non-quota species with market potential before the introduction of the new Fisheries Regime in 1993.

218.The investment when it was made left a new well-equipped though financially highly geared fleet sensitive both to competition and to the price/cost squeeze following the second oil shock. As a result, a high level of bad debt has been incurred and many more vessels are financially precarious to the extent that it is not clear that present fleet size can be sustained or that present catch levels can be significantly improved. Diversification to non-quota and higher value species however does leave some room for growth and a requirement for further investment in adaptation.

219.The investment in fish processing and aquaculture is more recent and though both are still at an early stage both show considerable potential. The proportion of fish sold in its highest value form though 35% and rising is however still very small. The development of fish processing is part of the remit of the IDA (and Udaras). The development of aquaculture should be given a high priority in BIM’s development programme. It now accounts for 10% of fish landed and should increase to 25% by 1990.

220.Net expenditure by Irish taxpayers on protection of EEC fisheries is quite substantial though the beneficiaries if any may not be Irish. Much of the regulation and control is held in very poor esteem by fishermen. This may render it ineffective. One reason is that the information on which control is based is not well based and indeed it is widely believed that quotas and licensing are not being enforced.

221.There are serious inadequacies in the information whether that relates to catch and income arising or stocks and locations. This deficiency is often the basis for getting the balance wrong between conservation and exploitation and provides a poor base for the substantial investment decisions being called for by fishermen and fish processors and the taxpayers.

222.There is poor coordination and contact between the industry and the State and its agencies and between the agencies.

223.All of these factors compounded by the late start in fleet investment contribute to the poor return on public expenditure on developing the fishing industry and form the background against which the Committee makes the following recommendations:-

Fisheries Statistics

224.Monitoring of stocks, landings and exports is becoming an increasingly important part of fisheries resource management. This can and does conflict with industry interests. It is therefore of vital importance that data is consistent and accurate. The Central Statistics Office should have an increased role in determining the form of data collected relating to value and volume of landings and costs while the data itself can emerge as a by-product of the work of the appropriate fisheries agency and should be provided to the CSO on an agency basis applying proper data collection techniques. The Committee urges implementation duly updated of the recommendations made by ESRI in 1980.

225.The Committee referred to other data difficulties arising even for historical financial information on public expenditure. Accordingly, it recommends an improvement in the transparency and consistency of all data relating to public expenditure on fisheries. This includes changes to the Annual Reports of the Department, BIM and CFB to provide a better breakdown by expenditure programmes.

226.The Committee also recommends that the annual cost of debt servicing appropriate to Fisheries in each separate Public Expenditure Programme should be published in the first instance as part of the Comprehensive Public Expenditure Programme.

Expenditure on Harbours

227.A more positive and business-like approach by both the OPW and the Department of Tourism Fisheries and Forestry is recommended, along with a series of controls and procedures designed to improve project management. Government commitment for large-scale capital projects should be on a multi-annual basis.

228.Poorly defined criteria for investment choice, imprecise planning, changes after tender stage and during construction, poor information flow between the Department of Fisheries and Forestry and the Office of Public Works, and inadequate cost controls have in the past led to major cost over-runs on harbour projects.

229.The Committee recommends that a most comprehensive cost benefit analysis be undertaken before further development commences at Rossaveal, Co. Galway and that an appropriate grant be provided for local authorities charged with responsibility for the maintenance of smaller harbours and piers to halt the present pattern of breakdown followed by expensive replacement.

Harbours Policy

230.The Committee would urge the Minister for Communications to complete his review as a matter of urgency with a view to ensuring that future capital projects have a framework within which those from which greatest overall benefit can be derived can, and with some objectivity, be selected. Lack of a policy on harbours, and on our coastal resources generally has prevented the development and application of criteria for evaluating and comparing investment choices in multi-purpose harbours. This deficiency has also contributed to delays and difficulties in establishing aquaculture and to threats from pollution to projects, once established.

Investment in the Fishing Fleet

231.The Committee considers that further expenditure of significant public funds on adding to the size, range or capacity of the fleet is inappropriate and that the BIM schemes for capital and interest grants should be geared towards the full use of the FEOGA scheme for rationalisation of fleets including withdrawal and adaoptation and for the development of mariculture. Without this further adaptation will undoubtedly create a capacity problem.

232.It may will be that the development of the Irish Fishing Fleet started too late and that, as alleged by fishermen, prices were determined more by a commitment to keep boatyards in business than by the competitive position faced by fishermen or the alternative cost of boats.

233.It seems that BIM was excluded from restructuring loans in a manner which would be normal to any commercial institution. Whether because of the number of submissions and amendments or for reasons of delay between BIM and its Department, the approval of the Department of Finance was delayed for 18 months. This probably precipitated avoidable foreclosures on some boats and certainly sustained avoidable uncertainty for BIM and for grant and loan applications for larger boats where the Departments have a veto.

234.In light of substantial losses arising and the growing evidence of a conflict arising from the dual role of development agency and bankers to the industry, the Committee recommends that BIM invite independent expertise to examine the feasibility of establishing a Marine Credit Union open to all fishermen and fishing interests and transferring by way of loan to the Credit Union its existing exposure to the fleet. This fund and the savings of members would provide the capital base from which future loans would be made. BIM would of course continue to provide capital and interest grants as deemed appropriate and participate in the Credit Union.

235.This or some alternative feasible means of phasing out of the provision by BIM of commercial credit and indeed of guarantees is in the view of the Committee a necessary preliminary to BIM taking on new roles.

Aquaculture

236.The Committee was concerned to note the multiplicity of State-sponsored organisations, lack of co-ordination, delays in establishing an adequate legal framework and difficulties in designating areas for mariculture have led to a waste of resources and created problems for all concerned and delay in establishing the industry. The Committee recommends that BIM should be given responsibility for aquaculture development and consideration should be given to the concept of a “one-stop shop” of mariculture applications. A coastal resources management policy should be developed as a matter of urgency, and CFB should be given appropriate authority to oversee fresh water fish farming.

237.The question of pollution control is vital to the future of aquaculture and so authority should be vested in BIM for coastal areas and CFB for inland waterways.

238.The most critical question however is the appropriateness of the present grant schemes for aquaculture promoters. Being a capital grant where the main investment arises in working capital over the first two years it can do little to help the small promoter. This Committee would urge that suitable standards be set for determining a prudent basis on which a short term loan guarantee could be added to the grant package for small promoters.

Fisheries Research and Development

239.Too many agencies with overlapping and/or unclear functions, absence of a clearly defined R and D policy, organisational and structural weaknesses and lack of facilities and resources have led to a wasteful situation in which the skills of the scientists are not being used to the best advantage.

A number of linked recommendations are made with the aim of increasing integration and making more effective use of the resources available.

1.Inland Fisheries research and development should come under the management of the Central Fisheries Board.

2.Marine R and D should come under the management of Bórd Iascaigh Mhara.

3.Both marine and inland/fresh-water R and D personnel should share extended facilities at the Fisheries Research Centre, Abbotstown.

4.A permanent co-ordinating committee on migratory fish should be supported by a small secretariat/research team based at the FRC.

5.In line with the D.P.S. White Paper the Department of Tourism Fisheries and Forestry should no longer be required to be involved in the day-to-day executive role of fisheries research/management, development or research so that it can concentrate on policy, planning and co-ordination.

6.The Department should be in a position to commission research or development work on the basis of the “customer-contractor” principle in support of its commitment to ICES and to the Common Fisheries Policy of the EEC, and for the provision of advice to the Minister.

7.Advisory groups to ensure liaison between the R and D programmes and the industry should be established.

8.The research project budget proposal and control procedure already established at the FRC should be extended.

9.A wider co-ordinating committee to prevent duplication across the whole field of fisheries R and D should be established.

10.The Management Service Unit of the Department of the Public Service should be asked to review the implementation of these recommendations.

Quality Control

240.Improved quality control in the industry is essential, particularly if existing export markets are to be maintained and new ones developed. To this end the Committee supports the recommendations of the Sectoral Consultative Committee and recommends that immediate steps be taken to determine suitable standards for licensing of fish processing plants to ensure they comply with export market requirements. A system of plant inspection should then be established extending food plant inspection schemes operated by the Department of Agriculture with an appropriate levy to cover costs.

Marketing Processing and Added Value

241.The Sectoral Consultative Committee’s recommendatiosn are endorsed, with BIM continuing to provide a consultative role for Údarás, and IDA who should continue to have primary responsibility for the development of fish processing. BIM’s special brief in this field should be the promotion of contracts, profit-sharing, equity participation and other means of tying supplies to plants.

242.As for market development BIM’s role should be reassessed with a view to establishing industry agreement to fund whatever level of generic promotion of fish on the home market is warranted and with a view to integrating the export promotion and marketing of fish products into the overall CTT programme and providing a cost effective commodity brokerage service on commission.

BIM

243.Many of these recommendations should combine to have the effect of focussing BIM’s role on the primary fish sector between catching and farming. To be effective BIM will require the authority to pursue a policy and to change its shape and direction as the needs of the industry changes.

244.Present arrangements where two Departments (Tourism Fisheries and Forestry and Finance) must consider and approve simple operational matters which should be within the remit of management and the board is unsatisfactory, in terms of cost-effectiveness.

245.The Committee believes that a suitable short term loan guarantee scheme is required to support the development of aquaculture if a reasonable chance is given to small promoters. The authority to restructure loans and the authority to apply CFP policy and support for fleet modernisation and adaptation, the authority to deploy or retire staff and other authorities consistent with their responsibilities as set out in their brief and their overall budget are all essential prerequisites to good value for public funds spent promoting the fishing industry.

246.In short a more effective BIM offers the best prospect of improving the cost-effectiveness of public expenditure on fisheries, and this requires speedy adaptation of BIM’s strengths and activities and increased authority in the discharge of its approved responsibilities. As the best means to this end the Committee recommends that a reapparisal of BIM in light of its emerging new brief be undertaken with the help of outside consultants.

Training

247.BIM is also responsible for training for the fishing industry. The training programme should now begin to reflect a shift from training for the fishing fleet to aquaculture and mariculture for the future.

248.These new courses should also be designed to derive the maximum funding support from the European Social Fund and provision should be made for a continuing AnCO involvement in course design and appraisal.

Protection

249.The very substantial Exchequer cost of operating the fisheries protection service is undertaken by the Naval Service and Air Corps on behalf of the EEC. This seems to have been lost sight of because £32m of the £50m spent on acquiring protection vessels was funded by the EEC. It would seem to this Committee in light of the Irish quotas and other Irish costs of fishery protection including data gathering and the inspection system that, the other Member States are not meeting the reasonable proportion of the costs associated with protection. The Committee recommends that this should be fundamentally reassessed with a view to reducing our liability by negotiations, to the cost of protection in proportion to our quota or about 20% of the costs arising. This is in line with the European Council decision in October, 1976 that protection and control of the fishing zone off Ireland must not result in a cost to Ireland disproportionate to the share of fish resources in the zone being exploited by Irish fishermen. This is, of course, quite a separate topic to the effective use of the fishery protection expenditure which has been challenged by many fishery interests. Meanwhile the Committee urges that immediate attention is given to seeking appropriate reimbursement of 80% of the costs incurred.

Salmon

250.Present salmon licensing regulations are designed to reduce the size of boat and the efficiency of catching gear as a means of protecting stock. They are honoured more in the breach than in the observance and seem to have lost the respect or authority good law must have to be effective. Accordingly, the Committee recommends that serious consideration be given by the Department of Tourism, Fisheries and Forestry to a quota system for each region supplying tags to each licence holder to mark all legally caught salmon sold.

251.If the system is found to be operationally feasible as it has in other countries licences should be more freely available though they may apply for less salmon and a shorter season depending on salmon stocks. If the system was given the full support of licensed fishermen in each region it should prove a more effective alternative to the present system. If, however, it is rendered ineffective by being widely flouted then there is no alternative to rigorous enforcement of the present system.

The Central Fisheries Board

252.These recommendations have already referred to the Central Fisheries Board under a number of headings including Research and Development, aquaculture, accounts and salmon.

253.The Committee considers that the Board cannot be effective in developing our inland fisheries while the present position on salmon continues. The Committee urges that this be resolved and that the report of the Department of the Public Service on its management structure be implemented.

254.The Committee is conscious of the fact that the number of angling tourists and the revenue has been falling in recent years. By effective coordination of efforts between Bord Fáilte and the Central Fisheries Board the Committee considers that this decline can and should be redressed. This may, after implementation of the DPS recommendations on CFB structures and management and this Committee’s recommendations on salmon licensing, still require some additional resources to improve access sign posting, stock levels and information on Ireland’s angling amenities. This Committee considers that if that can be shown to add to tourism revenue it would prove not only cost effective in terms of the national economy and jobs in tourism but also in terms of increasing Exchequer revenue.

255.The Committee considers that the Office of Public Works should be obliged to rehabilitate river beds as part of major drainage programmes and that our salmon resources should be managed and exploited by promoting a combination of ranching farming and development of wild stocks for angling and estuary and draft net fishing under quota.

256.The Committee is conscious of the importance of good fishery resource management from the point of view of angling and the considerable tourism revenue arising. This has been falling in recent years and can and should be reduced by effective coordination between the Central Fisheries Board and Bord Fáilte. This will first require giving the authority and support necessary and develop out fisheries to the Central Fisheries Board.

Conclusion

257.The fishing industry has been through a period of major change since Ireland joined the EEC and the fishing fleet has been a victim of a serious price/cost squeeze since 1979. The combination of these and other external circumstances including the present state of fish stocks, the developments in aquaculture and the special advantages Ireland enjoys signals the advent of a time for new thinking for the industry. This coincides with the need for a much more critical look at the impact of all government expenditure programmes.

258.Accordingly the Committee recommends that there should be an immediate re-organisation of the Fisheries Division so that all the necessary management, administrative and technical expertise will be available to the Minister. This action is vital if the potential of the industry is to be exploited through a combination of effective controls, a well based strategic development plan and effective negotiations under the present and future Common Fisheries Policy regimes.

8. ACKNOWLEDGEMENTS

259.This review of Public Expenditure on Fisheries was undertaken with the full co-operation and participation of the officials of the Department of Tourism, Fisheries and Forestry, BIM and the Central Fisheries Board whose assistance is gratefully acknowledged as is the assistance of Mr. A. J. O’Sullivan, whose report to the Committee formed the basis of this report. The Committee also sought the views of a wide range of organisations, representatives of the various fisheries interests and the following organisations provided written and oral submissions:-

Irish Fishermen’s Organisation

Irish Fish Producers Organisation

Irish Fish Processors and Exporters’ Association

Irish Aquaculture Association

Irish Marine Farmers’ Association

Killybegs Fishermen’s Organisation

Trout Anglers’ Federation of Ireland

Mornington Fishermen’s Association

260.The Committee also had the benefit of the report of the Sectoral Consultative Committee, the Sectoral Development Committee and the views of other professional interests in the industry in preparing this report. The Committee, of course, expresses its own opinions based on the information available to it and in compliance with its mandate to review the justification for and effectiveness of public expenditure programmes in search of greater cost-effectiveness.

261.Despite the substantial expenditure involved the industry is still seriously threatening some key stocks and is underdeveloped. There is considerable evidence of duplication and ineffectiveness in the Industry’s public sector support. But there is a widespread recognition of the need for a new beginning.

262.It is hoped that this report together with the forthcoming White Paper will result in more effective and, therefore, more cost-effective deployment of public funds provided to assist in the development of our fishing industry.

________________________

Michael Keating T.D.

CHAIRMAN.

May, 1986.

* Committee Report: Control of Capital Projects (Pl. 3482)