Speech to the Seafood Industry Council Conference

In response to some of the supporting comments from the audience let me begin by saying how very proud I am, and every kiwi should be, of New Zealand’s Quota Management System.

It’s not perfect, but it has resulted in one of the best of two expansive fisheries in the world, Alaska being the other. It is a source of pride to me that, when overseas, so many foreign officials ask me if it is possible to work with the Ministry to develop a similar system in their countries. Argentina is a case in point.

Your programme yesterday was very interesting and stimulating. I hope you enjoyed the panel discussion as much as I did.

As he always does, the PM got things going with a hiss and a roar – and I’d like to pick up on some of the challenges he laid down for you.

The world in which we operate is one of great change and challenge – we’re all learning to expect the unexpected, as hard as that is.

It’s the way we respond that counts – organising ourselves and putting ourselves in the right mindset to turn the negatives into positives for the long term futures of our businesses.

On top of the income rollercoaster in recent times, we’ve had to face the destruction of premises, ports and lives – not only in our own country, but also in one of our key export markets, Japan.

The response has been awe-inspiring. At the Federation of Commercial Fishermen’s conference I talked about Independent Fisheries, which had 1000 tonnes of liquefaction to clear. They shifted it in less than 2 weeks and were up and running again.

Most of the stock was saved from damaged freezers by shipping it off to waiting customers overseas. Staff were taken on from other businesses and the company is looking to upgrade its premises.

Another example of good old kiwi resilience in the face of adversity was Cloudy Bay Clams. The company harvests surf clams in Pegasus Bay north of Christchurch. They had to quickly shift their entire operation north to Cloudy Bay to avoid the water quality risks in Christchurch after the quake.

Opportunities and challenges

Last year at this conference the PM challenged you to ‘get on the fast boat to China’. I talked about improved international conditions and the strong economic platform you have to build from.

From where I’m standing it looks like you’ve seized the day – but there’s plenty more you can do yet.

I also said businesses everywhere were facing the hard decisions they need to make to secure their futures, and that the biggest opportunities for growth were likely to be in increased efficiencies and added value.

Nothing has changed there. What has changed are the FTA with China, the unforeseen events I talked about earlier – these represent opportunities as well as threats for the industry – and the move to merge the Ministry of Fisheries with MAF. A real rollercoaster ride.

Wayne McNee will talk about the merger in more detail shortly. It will definitely help support the Government’s export-led economic growth agenda, and reduce the regulatory burden, duplication and operating costs.

Some of the savings will be shared with the sectors and industries the two organisations do business with. I was pleased to read Peter Bodeker’s positive comments about the potential of the merger for the industry. All good news.

With some recent seasonal exceptions, export prices for seafood have remained reassuringly strong. Rising international prices are generally more than offsetting the impact of a high New Zealand dollar, driving investment into higher value products.

The total value of seafood exports for the year ended March 2011 increased by a very healthy11.4% to $1.52 billion. Inshore shellfish did even better – a 17.2% increase to over $281 million. Excellent stuff!

So now you can sit back and rake it in – right? Wrong! The potential is there for growth, but it’s going to take effort and commitment from everyone involved to deliver the long-term dividend.

The biggest opportunities will be in increased efficiencies in catching and processing, and adding value to seafood, not in increasing catches.

Investment is needed to get anywhere with that. The big challenge is to create more value from the same amount of fish.

You’ve heard it before - more consolidation and rationalisation of the inshore industry, in particular, is possible. It could be painful.

The inshore fishery has been the least talked about in recent times and I want to change that in the next term of government. In fact, I would like to put the same amount of attention into the inshore fishery that has gone into aquaculture over the last three years.

It could be described as the ‘problem child’. And the inshore fishery, like a problem child, while appreciated no less than the others – deep sea and aquaculture - it does need special attention.

In contrast to the deep sea fishery there is intense competition for space. Marines farms, marine reserves, matatai, yachties, ports and bach views. Your trawlers cross the path of recreational fishers and marine farmers, your activities can be seen from bach’s.

I explained yesterday that I am now formalising a program to better engage with amateur fishers on how to ‘improve the recreational fishing experience’. I have been disappointed how commercials have not come to the table, as invited, with suggestions on suitable recreational-only areas. However, I do acknowledge that it’s often those same people – bach and yacht owners, recreational fishers - who complain about your inshore activities even when they line up in the fish shops to take home their meals of snapper, paua and rock lobster.

There is opportunity for a better recreational fishing experience and increased commercial catch of some inshore species. However, my approach to catch limits is always cautious and responsible. I’ll increase catch limits yes, but if stocks are under pressure I wont hesitate to slash TAC’s.

One area that is of real interest to me is the need to manage the high value rock lobster and paua fisheries.

It is abhorrent to me that up to 25 per cent of all rock lobster and 50 per cent of paua is poached. There may well be a case for opening up more space in the inshore fishery to paua and rock lobster fishers as this would inevitably mean more eyes and ears on the ground. Closer scrutiny of these fisheries, greater enforcement and increased sustainability means a higher return to New Zealand.

Later this morning you’ll be hearing the Southern Clams story. They catch cockles and Queen scallops in Otago coastal waters. Almost all their 900-tonne cockle catch each year is exported live to the US, Europe and Asia.

They have been fishing the same beds since the 1980s. To get maximum value from their product they need continuity of supply to markets. Their reliance on only one harvesting site means they can’t supply continuously, so they’re now investigating the sustainability and environmental impact of harvesting at an alternative site in Otago Harbour.

You’ll also hear about the Coromandel Scallop Fishermen’s Association. A great example of the way collective action can work in the name of efficiency – I’m all for it.

The recognition that the QMS keeps getting internationally helps us a lot with market perception.

We offer big points of difference with our fisheries management system. Capitalise on your competitive advantage by nurturing the brand.

We need to keep focusing on the challenging issues. Discards and protected species interactions affect the way New Zealand is seen in the market so we’re focusing on improving monitoring and management.

These issues are never easy to address cost effectively. I’m hearing good things about the work the industry and the Ministry are doing to resolve them. Long may this continue.

Implementation of the Observer Services Strategy will increase efficiency of delivery in conjunction with industry, and less red tape.

Completing the Review of Discards, which I understand is making good progress, will improve the reporting and management of discards in our commercial fisheries.

I was very pleased to learn of the recent creation of the Inshore Fisheries Industry Council. Cohesive representation is always going to be advantageous when key issues are being debated and decided on.

I’m very hopeful that the establishment of this group will provide more efficient and effective engagement on inshore fisheries issues, and improve the ability of both industry and the Ministry to identify and prioritise real economic growth opportunities within the inshore sector.

Research services

The Ministry is in the process of revising its approach to the way it procures research through a move to longer-term contracts.

An international tender has been put out to support the implementation of the 10-year research programme for deepwater fisheries.

The longer timeframe for these contracts will give opportunities to focus on transparent partnering arrangements and will help ensure better administrative arrangements.

The Ministry is also looking at the best way to support direct purchasing of research by industry. A report on this is now on the Ministry’s website.

The Ministry has just released a Research and Science Information Standard, which will help make sure the best available information is used for fisheries management decisions.

Observer Services

The Observer Services Strategy Review project has delivered a number of benefits since it was re-scoped in 2010.

The project was a collaborative review involving industry, the Ministry, the Department of Conservation, and environmental non-government organisations.

There were four workstreams - cost-efficiency, process improvement, a standards manual, and future models of service delivery.

These workstreams have been completed and good progress is being made towards implementation. I’m confident there will be opportunities to reduce fishing industry costs, improve efficiency of the Ministry’s service delivery, for government to support the economic development of the fishing industry, and to improve the effectiveness of observers’ contribution to fisheries management.

The Deepwater Observer Optimisation project is about getting the right information at the right time from our fishers; a value proposition to observer coverage.

Regulation

I’m very pleased to report that the Government is meeting its commitment to taxpayers in general and businesspeople in particular to cut the red tape.

Our commitment remains making the regulatory framework more streamlined, user-friendly and easy to understand.

We can’t compromise environmental protection and the gathering of important management fisheries information in the process though.

We’re making good progress towards the right balance between less red tape, cost savings – imposing less on you – and sustainable management.

Recently we announced the removal of a grand total of 176 unnecessary regulations from the books. This round it’s out with the 1995-96 Jack Mackerel Quota and the Fisheries (Transitional Provisions) Regulations (No 2) 2001.

Next cab off the rank is progressing a Regulatory Reform Bill to reduce the compliance burden on business. Included in this Bill are two amendments to the Fisheries Act to, for example, ensure a simple process for registration as a “notified user” (people other than a registered operator using a vessel, enabling greater flexibility in commercial fishing from a fishing vessel).

We’re also looking to consolidate the fisheries commercial and amateur regulations to ease the regulatory burden on stakeholders by (among other things) providing for less regulation - revoking 22 sets of regulations and consolidating them into two sets, allowing greater accessibility for users, and helping any substantive reform of the consolidated regulations in future.

Catch limits

Having said that, there’s always going to be a call for rule changes for good reasons.

Since your last meeting we’ve seen catch limit changes for species such as stargazer, rubyfish, scallops, rock lobster, southern blue whiting, hoki, orange roughy and black cardinalfish.

As well as this, bladder kelp and Patagonian toothfish were brought into the QMS and I made my decisions on set netting.

My approach to catch limits is always cautious and responsible. I’ll increase catch limits only when I’m sure it will be sustainable. If the research says a reduction is needed for the sake of sustainability, that’s where I’ll go.

I’m sure that in future I’ll have even better information to base my decisions on.

Conclusion

I wish you well for the rest of your conference. The topics you are discussing are vital to the future of your industry and the New Zealand economy as a whole.

The world in which we operate - just like the business climate - isn’t certain, and there are new challenges facing us all the time.

The opportunities are enormous – we need to take control of the things we can and make maximum advantage of them.

I urge you to grasp every opportunity you can find to add value and build your businesses and the economy - to help give us the future we all want.

I feel as Minister of Fisheries we have traction and the train has left he station with regard to aquaculture and improved deep sea fisheries. In the next term of Government I would like to see the same intense focus on inshore fisheries. I want to better get the balance right for recreational, customary and commercial users. This will mean the same level of intense work that has gone into the aquaculture reforms.

Thank you for your time