Moved by Baroness Jones of Whitchurch
107: Clause 27, page 18, line 6, at end insert—“( ) reserving a proportion of fishing opportunities for boats whose length is 10 metres or less;”Member’s explanatory statementThis amendment would allow regulations made under Clause 27(1) to reserve a proportion of annual fishing opportunities for small boats.
My Lords, Amendment 107 in my name follows on from our previous debate about the management of, and criteria used for, allocating future fishing rights, which could be the subject of competitive tender or auction. Without repeating the whole debate, the Minister said in winding up on the previous amendment that consideration is being given to the new quota allocation. She also told the noble Lord, Lord Teverson, that there was support for a new entrants’ scheme. If that is the case, my challenge back to the Government is: why can we not include the principles of that in the Bill? If the Bill is for anything, it should be for those sorts of future planning activities. I hope we can find a form of wording that incorporates that in the Bill.
We have addressed our concerns about how any future auctions will be run, and what the consequences would be if they were driven solely by the highest bidder. Our amendment would require regulations made to deliver the auctions to reserve a proportion of the fishing opportunities for the under-10-metre boats. The previous debate sought new opportunities for new entrants to the sector. This amendment more specifically focuses on the smaller-sized fleet.
We have already explained the importance of the smaller boats to the economic and environmental sustainability of the sector. They generally use lower-impact gear and provide more jobs per tonne, but their current share of the quota is limited to around 6% of the total. Yet in the UK, the under-10-metre boats represent more than 70% of English fishing boats and 65% of direct employment, so we should be using this opportunity to boost their numbers and their share of the sector.
This is a central argument in our bid to revive the declining and impoverished coastal communities, and for that to work we need a spread of smaller boats accessing the smaller harbours and ports. This intervention is particularly necessary as the small-boat sector is shrinking every year. Between 2007 and 2017, the number of fishers on UK-registered vessels decreased by 10%. In his letter to noble Lords of
Nevertheless, given the Minister’s previous comments, I hope he will support this very modest amendment. After all, all it does is to require the auction regulations to address the issue of reserving a proportion of the auctioned fishing opportunities for the under-10-metre fleet, so I hope he can support it.
Amendments 108 and 109 address our wider concerns about the competitive tendering and auction processes. They rightly raise whether we should take into account the bidder’s impact on the marine environment when allocating new quotas. As we have debated before, these amendments have considerable merit and are in line with our earlier arguments and I hope the Minister will support them.
Amendment 110 in the name of the noble Baroness, Lady Worthington, proposes a new Clause 27. Again, she has taken on the Government’s drafting to a considerable extent. I am grateful for her efforts. She specifies in detail what she feels that the ownership and distribution rights of English fisheries should be. These include quite detailed proposals, but they also keep the competitive tendering and auction principles with which we have some concerns. I look forward to hearing the noble Baroness’s explanations for these proposals. It may well be that we will be persuaded at that point. In the meantime, I beg to move Amendment 107.
I thank the noble Baroness, Lady Jones of Whitchurch, for putting steel in my backbone again and demanding that this is in the Bill—whereas earlier I sort of retreated a bit.
I am interested in hearing from the Minister how these auction rights will be used. Will they be for all quota or the new quota? I would like to use this opportunity to understand the Government’s specific intention for using these rights in the Bill. How will they do it and when? Will it apply to new quota or all quota? I am unclear, because it all starts with the Secretary of State in May. I would be very interested in understanding what the Government intend to do in the near term.
My Lords, I rise to speak to Amendment 110 in my name. I have, perhaps overconfidently, attempted to redraft Clause 27 to set out the mechanism through which the rights to fish held on public trust are reallocated in the context of the English fishery, which is unequivocally the responsibility of the Secretary of State, since we are not talking here about anything that affects the devolved Administrations.
We set out this redrafted clause to try to mesh together the various elements that the Bill is founded on. I strongly believe that this should all be on the basis that this is a right held on trust and conferred to the private sector via the Secretary of State, and that these powers are held by the Secretary of State and then conferred. We see that there needs to be some allocation process by which those rights are transferred. I would like to hear—yet again, rather depressingly—whether this power being taken under Clause 27 applies to all quota or simply quota that may or may not be released as a result of some kind of negotiation with Europe. It feels like a real missed opportunity if it is the latter. Nothing in the Bill should prevent our applying these principles to all quota.
It seems incredible that we are here, at the start of a new decade, thinking about an unlimited right being carried on in perpetuity by the holders of the FQA system. There really needs to be a clarification. In a sense, Amendment 110 and the reworked Clause 27 speak back to Amendment 105 and the reworked Clause 25. They are a pair: the second implements those principles exclusively in relation to the English fishery.
In response to the question from the noble Baroness, Lady Jones, about the auction and competitive tender, this is a valuable tool to have in the kit. It would need to be carefully managed, and we would need to think about how an auction is carried out. There are other auctions for government contracts or rights carried out in different sectors of the economy. The one that I know best is the allocation of contracts for zero-emissions energy, in which case certain pots are made available and certain rules written around the allocation of those rights. If the fear is that these competitive tender processes would always lead to the more dominant players gaining more access, there are policy mechanisms that one can use to mitigate that risk.
This is a crucial clause because it also establishes this concept of payment for something held for the public trust. I am always a bit worried when I hear the Ministers saying, “We’re going to use grants to encourage better behaviour.” They should not have to use grants, because they are granting a right worth tens of millions of pounds every year. In a sense, they do not need to invent additional financial incentives when they have this existing financial instrument in their hands. It should be seen as such, because it certainly is by the fishing operators. It is not a pastime carried out without focusing on the bottom line and the profitability of the activities. The Government must take that approach.
To bring holding a property right in trust to life for noble Lords, if you own a piece of land or a house and simply give it away and say, “It’s fine. You can have that, no questions asked”, it is not likely that that property will be well looked after. You would also feel very vulnerable if you did not have a solid legal basis against which that transaction was carried out.
I am afraid that the current drafting of the Bill is not clear. There is still a lot of uncertainty, which is why the courts get involved and we lose legal cases around this question of quota allocation. There is not a really clearly laid out basis on which we do this transaction, confer these very valuable rights and hand them to the private sector.
As I say, this is a partner to Amendment 105. Listing in proposed new Clause 25(5) the links back to the various plans and statements—fisheries management plans and the marine plan—is an attempt to make the Bill holistic, mesh it together and make it read back against itself in a way that has some meaning in the real world. I will leave it at that.
My Lords, I have been sitting here and listening for a long time. I have worked with these people and know their stories really well. We are also very passionate. We do not expect the English to get upset and worried—to love their boats, to want to bring in their youngsters, teach them properly and bring them forward.
I tried to look back and see what things stuck out for me. A lobster hatchery that I put together down in Cornwall is going jolly well—we enjoy it. In those days, people were able to take money from the European Community to train children to go to university and learn. At the same time, they would come over and take what they liked: when you came to another place, you were supposed to bring your police with you and not have any cheating. You were supposed to be watching it. However, when you talk to the Spanish and the rest of them, who had a hell of a job to get themselves enough fish, they just took it—they left the police back at home. I grew up like that.
We will find it very difficult to pull our people away from saying, “It’s all right now. Everything’s fine. We don’t need to worry”. We do need to. This is what we have heard from this marvellous lady here. I did not know her before, but she is terrific. What these two Ministers have done with patience over hours and hours is something that you do not see at sea.
I remember the first time that you could look down and see all the fish coming, because of the technology that showed it to us—watching us taking loads ourselves and pulling through. We just had to lose it. We had so much that we did not know what to do with it.
At the end of the day, what we do best is fish and chips. We love it down in the West Country. We love to sell it. The frightening thing is realising that our water goes right up to France. We have this huge amount of water around us, this great big place. We also have a place where we can eat the food we love. Hands up—who knows what we eat more of? What is it? Can no noble Lords say what they love to eat? Are you not going to be able to say, “of Britain, of England”? What do we eat? It is beef. We do not eat fish; we eat beef.
I will finish in just a moment. I do not think that it is a problem, or what we are doing is wrong. I think we are recognising, hearing and seeing the great excitement that is coming to us. We have not yet spoken about training up the youngsters to bring them in, get them keen, and get the mechanisms through. I would like to congratulate the Front Bench. I hope that we do not hang around much longer. It has been a long time and I have enjoyed it.
My Lords, I congratulate the noble Baroness on her work on the lobster hatchery in Cornwall, which really is something quite special and has been very successful.
My Lords, I too thank my noble friend Lady Wilcox very much for her distinguished support for fishing interests over many years.
Amendment 107 in particular would seek to reserve a proportion of English quota to be sold solely to the under-10-metre fleet. In England, the decision about whether to tender any quota is still being considered. I would say to all noble Lords who have contributed to this debate that all these matters are under active consideration. I will want to take back a large number of the points that have been made, but the criteria to be applied to any auction or tender could address concerns raised in relation to the under-10-metre fleet. Measures could be introduced to limit the lots being tendered, the amount of time they are tendered for, and the groups that they are targeted towards. As I have said, the Government will consult on the scheme and any allocation criteria. Other countries, such as Iceland and the Faroes, have explored auction systems for selling national fishing quotas. We will, therefore, also look to learn from these and other countries’ experiences. The Bill provides flexibility about how any future scheme might operate. It would already allow a scheme to be made only for the under-10s, for instance.
I turn to Amendments 108 and 109. The Government are committed to using the additional quota we secure to benefit our fishing industry and the coastal communities that they support. I know that the noble Baroness and many noble Lords will be disappointed, but the Government’s intention is to use this power to auction and tender additional quota. We recognise that this is an opportunity to support different catching sectors and will be consulting in the future, but the Government are committed to the support of coastal communities. While it is our intention that that these additional fishing opportunities be sold, and fished, the clause does not currently prevent someone from buying it and not fishing against it, as Amendment 108 seeks to provide. That said, I would caution that stopping this additional quota from being fished could reduce the benefit for our coastal communities. Encouraging those who do not intend to fish the quota to compete in auctions could also increase prices, and potentially outprice our fishers.
To address Amendment 109 specifically, I highlight that the quota tendered or auctioned through this clause would be only a proportion of total UK quota, as it relates to England only. It would therefore apply only to a proportion of fishing activity, and we must not forget that a significant proportion of our most valuable catches are actually of stocks that are not covered by quotas. Our ambition is to make the whole fleet more sustainable. We believe that this amendment, while well intentioned, is actually too narrow in focus, given that the Bill already provides a range of tools for fisheries managements to ensure that the impact of fishing on the marine environment is minimised.
Any scheme developed under Clause 27 would be developed in line with the sustainable fishing policies and practices that will be set out in the joint fisheries statement, which we have already discussed at length. However, as with everything relating to fishing, it is not as straightforward as might be imagined to determine what a sustainable fishing method is. As with all gear types, an assessment of sustainability is dependent upon how, when and where they are used. Advances in gear technology have also transformed sustainability and greatly cut unintentional bycatch. It is worth noting, for example, that, in line with a management approach the UK supported when an EU member state, Defra has already taken action to end a fishing technique that has caused concern—one that I believe the noble Lord, Lord Cameron of Dillington, referred to in an earlier group of amendments—being used by English vessels: namely, electric pulse trawling. English licences will be withdrawn at the end of the transition period to end the practice in UK waters by English and any foreign vessels we allow to fish in our waters. Decisions on a future scheme regarding the sale of English fishing opportunities are yet to be determined and will depend on further exploration and consultation. It is right that we continue to develop the details of the scheme with the relevant stakeholders, so that it is flexible.
I turn to Amendment 110. While I agree with the noble Baroness’s intention to ensure that any sale of English fishing opportunities is regulated and based upon clearly defined criteria, I am advised that this amendment would undermine the existing quota allocation system. Case law has recognised that fixed quota allocation units—FQAs, the units by which quota is allocated—are a form of property right. We have committed to maintaining the current system of FQAs in relation to current quota allocations. This has to be taken into account in any new regime for the distribution of fishing opportunities. However, it is also important to highlight again that the UK’s sovereign rights over its fisheries and the public right to fish are already recognised in law. UNCLOS recognises in Articles 2 and 56 that coastal states have sovereign rights over the resources, including fisheries, in their territorial waters and EEZ. At home in our domestic courts, as had been referred to, Mr Justice Cranston noted, in the UK Association of Fish Producer Organisations Judicial Review of 2013, that the Magna Carta recognised fish stocks were a public resource and:
“Consequently there can be no property right in fish until they are caught.”
Additionally, the amendment links quota allocation and the provision of fishing licences in a manner which could inadvertently lead to confusion. While quota is indeed allocated to licence holders, these two concepts are separate issues and should be treated as such. This distinction is important as it allows, for example, quota to be exchanged between licence holders during the fishing year. Such flexibility helps fishers adapt to weather patterns, choke risks and other circumstances.
I absolutely understand the reason for the amendment, particularly given that the noble Baroness and whoever may be working with her have tabled this new clause. But the Government’s position is that there is more work to do on this. We want to consult on it; we want to get it right. All the points that have been raised, not only in the noble Baroness’s amendment but elsewhere, are on work that we wish to continue. That is why I am not in a position to confirm support for these amendments, but the work is continuing. I have found the points that have been made very helpful—
I thank the Minister for those comments. Could we have one of those meetings with the specialists in the room? I am merely a voice that is carrying a view from the sector itself. I would certainly appreciate that. In particular, could the Minister confirm that we can have a meeting on this point about the public rights and the allocation?
Most definitely. On the basis of my explanation, I hope that the noble Baroness will feel able to withdraw her amendment.
I just seek a couple of clarifications. With any new fishing opportunities, there will have to be an auction that people have to pay for, but with existing quota they will not. That gives a competitive commercial advantage, completely, to those who are already incumbents of the industry. I would think that the Competition and Markets Authority would be severely challenged by that. That is a real problem. If they are auctioned, do they then become permanent FQAs for those people, or is it a right for only five years? I was also very interested in the Minister’s comments that the rights over the fish stocks come from UNCLOS, which is an international agreement. That suggests to me that this is not a devolved issue. It is clearly a national issue, not a devolved one.
Clause 27 is about English fishing opportunities as far as I recall. The other thing I should say is that I have been very clear that the Government’s intention is to use this power to auction and tender additional quota. I have also said that the Government will consult on and consider this matter, so in matters of detail, I shall certainly not pre-empt any consideration by confirming or otherwise what the noble Lord has asked. This is obviously a matter that we wish to work further on and explore. I do not propose to take any more observations, but I will say to the noble Baroness that I am very happy for her and any other noble Lords—if they would let me know—to come and have a think piece on Clause 27.
My Lords, that is extremely helpful. If the Minister’s think piece is going to cover the circumstances in which existing fishing allocations could be or would be revisited—the whole issue of whether they were there in perpetuity or whether there were any circumstances in which the existing regime could be unpicked for whatever reason—I would certainly like to be part of that. I am still confused about how that would work and whether there is any flexibility. As I said, there must be circumstances—for example, if someone were repeatedly breaking the rules or operating outside the national interest—in which the authorities could intervene. I would love to explore what those are because the system feels rather rigid at this time.
I was grateful to the Minister for his warm words about under-10-metre boats. He said the matter was still being considered, and we keep being told that the discussion of whether there is merit in reserving some of the allocation for the under-10s will happen in another place. I am getting a little frustrated about this. I cannot see why, if the mood is going in that direction, it cannot be in the Bill. That is certainly something I want to reflect on and come back to, because I do not think that what we are asking for is unreasonable. If the Government are considering it anyway, I do not see why it cannot be in the Bill. For the moment, however, I beg leave to withdraw the amendment.
Amendment 107 withdrawn.
Amendments 108 to 110 not moved.
Clause 27: Sale of English fishing opportunities for a calendar year
Debate on whether Clause 27 should stand part of the Bill.
My Lords, I am grateful for the opportunity to debate this. We heard the figures earlier for the quota that is held: 29% of the UK fishing quota is owned or controlled by just five families; 49% of the English quota is held by companies based overseas; and the majority of UK fishing boats—79% of which are small-scale—hold only 20% of the UK quota. It is a source of great concern to me, as I said, and it was explored at some length in the Environment, Food and Rural Affairs Select Committee, which I had the privilege to chair for four or five years with my able deputy Barry Gardiner MP, who I know continues to take a great interest in these matters. One of the most shocking things that we discovered was that some of the boats and quotas were owned not just by foreigners but by non-active fishermen. The one that shook me most was that they were owned by English football companies. I therefore hope that the Minister, in summing up this little debate on whether Clause 27 should stand part will assure me that only active fishermen will be allowed to qualify.
My main comments relate to the work done in preparation for the Bill by the Delegated Powers and Regulatory Reform Committee in its sixth report of this Session. The committee was particularly concerned that the power under Clause 27 to distribute extra quota envisages fishing opportunities for British fishing boats that will take effect when the UK takes back control. The report refers in particular to paragraph 153 of the Explanatory Notes, and this is what I would like to press the Minister to clarify today. The original Bill’s Explanatory Notes say in that paragraph:
“The scheme would only be used in relation to the portion of UK quota which may be allocated by the MMO or the Secretary of State to English fishing boats. The scheme could include the requirement that certain criteria are met in order to purchase fishing opportunities, for example environmental criteria.”
This is the most important part:
“It is not intended that a scheme would be used to sell fishing opportunities exclusively on the basis of price.”
That has been toned down in the revised Explanatory Notes to the Bill before us today. The last two sentences of paragraph 172 say:
“The regulations could include the requirement that certain criteria are met in order to purchase fishing opportunities, for example environmental criteria. The regulations could therefore require fishing opportunities to be allocated on criteria other than the price.”
It sums up debates held on earlier amendments relating to Clause 27, but I would like the Government to reassure us that quotas will not be tradeable. If they are going to be sold on and the main criterion will be price, we could set up a situation similar to that with the milk quota, and that is totally unacceptable. Will the Minister assure us that that will not happen? That is what the Delegated Powers and Regulatory Reform Committee has also asked us, and I wish to press the Minister in this regard. Will she reassure us that they will not be tradeable and not governed exclusively by price? Would the Minister, in summing up, assure us that, in accordance with paragraph 153 of the Explanatory Notes to the original Bill, it is not the Government’s intention that sales of fishing opportunities under Clause 27 should be governed exclusively by price? Will she also offer a full explanation of the Government’s intentions with regard to the application of criteria other than price? What will they be? Could she expand on the interrelationship between these other criteria and price and their relative weighting? I am particularly concerned that these quotas might be turned into a tradeable commodity—that they will be governed exclusively by price and that that might extend to people other than our active fishermen. That would be totally unacceptable.
Clause 27 allows for the sale of rights to English fishing opportunities —quota and days at sea, known as “effort”—for a calendar year. I, too, have two copies of the Explanatory Notes, and there must be a third copy because I could not find the original one to which my noble friend referred. We could allocate quota another way, not based on price, but we do not need new legislative powers in the Bill to do that. This power just gives one option for the future approach: an additional quota for a limited period. I have asked for clarification on what other criteria could be used and their relative weighting, but it may be that I will have to write to my noble friend on that issue.
Any sales must be made in accordance with regulations that may include a range of provisions. These provisions could cover rights to be sold by competitive tender or auction, setting minimum prices, payment of compensation to anyone who holds rights but does not use them, and a range of other issues that would ensure that the sale of quota was tightly regulated. The 2018 fisheries White Paper made clear that any additional quota that the UK obtains as an independent coastal state would be allocated differently from the current distribution methods. This clause provides the Secretary of State with the mechanisms to do just that for English quota. Schedule 5 provides equivalent powers for the Welsh Government, for Welsh quota.
I have listened to noble Lords’ concerns; this clause now requires the Secretary of State to consult on the regulations, and to make clear that quota could be sold on the basis that price is not the only relevant factor. For example, a determining factor in any tender or auction could be in relation to proof of use of sustainable fishing methods or benefit to a local community. I therefore ask my noble friend not to oppose this clause.
My Lords, I have to say that I find it very disappointing, as the noble Baroness, Lady Jones, said, that the Bill will leave this place without the information being before us. The Minister did not reply on whether it is going to be an entirely tradeable economy or whether it will apply to non-active fishermen, and I find it very disappointing that we will not hear further clarification before the end of Committee.
My Lords, I can commit to writing on the issues of tradeability of fishing rights and non-active fishermen, but I do not have the answers to hand.