PIPI QUOTA MANAGEMENT SYSTEM

The Hon. R.J. McEWEN (Mount Gambier—Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development) (15:17): I seek leave to make a ministerial statement.

Leave granted.

The Hon. R.J. McEWEN: I wish to advise the house of the difficult position that a number of commercial fishers, small business operators and recreational fishers now find themselves in following the disallowance of regulations on 23 July 2008, made under the Fisheries Management Act 2007 concerning the pipi quota management system.

I commence first by informing the house of my disappointment at the manner in which this serious and complex issue has been dealt with by the opposition of this house, and the opposition and crossbench members in another place. Political mischief, combined with disingenuous lobbying by a small group of commercial fishers, who have never caught a pipi, or who have a relatively small catch history, has caused needless uncertainty and damage. Recent media interest and unfortunate statements made by fishers and opposition and crossbench members has highlighted the degree of misunderstanding and misrepresentation concerning the proposed management of this fishery.

I now place on the record a belief illustration of the extensive, consultative and inclusive approach that culminated in the decision by me to table regulations on 13 December 2007. In the absence of any viable alternative being offered by the opposition or other members, I will detail how the matter will proceed from here. The introduction of a quota management system on the Lakes and Coorong Pipi Fishery is aimed primarily at protecting and improving the biological sustainability and economic productivity of the pipi fishery. The introduction of the quota management system followed an extensive two-year review process that was underpinned by significant industry consultation and involvement.

The trend in increased catch and effort and declining catch efficiency in the pipi fishery over a more than 10-year period has been a growing concern for fishery managers. Under the previous scheme, there was significant potential for activation of latent effort; that is, licensees with pipi access that had not previously targeted the resource becoming active. Current protracted drought conditions in the River Murray have increased this risk as the health and availability of other finfish species in the Lower Lakes and Coorong areas of the fishery decline. The development of a human consumption market for pipis has increased its value and contributed to increasing catch and effort in recent years. It has been the most important species in the Lakes and Coorong Pipi Fishery in terms of both value and production.

From 1 July 2006, a food safety program was established to regulate pipis that were sold for human consumption. These regulations introduced water testing, harvesting and processed the requirements of relevant licence holders for the first time. Quota management is a standard fisheries management tool, with demonstrated success in South Australia and in other fisheries around the world. The majority of the larger and more successful fisheries in South Australia are managed under systems of individual transferable quota, including the blue crab fishery, three abalone fisheries, two rock lobster fisheries and the sardine fishery. Discussions on pipi management arrangements between the Primary Industries and Resources SA (PIRSA) Fisheries and the fishing industry began in November 2005 when agreement was reached that the Southern Fishermen's Association would engage with fisheries managers to develop options for the future management of the pipi resource.

On 22 November 2005, PIRSA Fisheries advised all licence holders of its concerns about the levels of catch and effort in the pipi fishery and that other long-term management measures would be developed in consultation with the industry to strengthen the management framework in the fishery. On this date I also met with industry representatives and reinforced that the Southern Fishermen's Association would engage with Primary Industries and Resources SA to develop management options.

During the following 12 months, PIRSA Fisheries formally met with industry representatives on five occasions to progress the development of the management options. Many alternative options were considered during this review and at the industry workshops. These included more restrictive gear regulations, area closures and seasonal closures, determining effort units, 'shelving' fishing effort, pooling fishing rights for auction among licence holders, and using an Olympic quota system where all participants fish without any individual limit until the total allowable commercial catch is taken.

None of these options were regarded as suitable by industry, and no alternative options were provided by the industry to address concerns about the stock. The effect on current commercial operations in terms of uncertainty in access security was also a major factor. During this time, a scientific stock assessment report for pipi was published, which suggested that the resource was in its weakest position for several years and that the trends in the fishery data were particularly concerning, given the high levels of catch and effort and latent effort in the fishery.

At the request of industry, a two-day workshop was convened at Goolwa on 20 and 21 December 2006 with stakeholders in the pipi fishery to develop new management arrangements for the fishery. Many options were considered, and discussion resulted in general agreement that the fishery should move to a quota management system.

A formal investment warning was issued by PIRSA Fisheries on 16 January 2007 following this decision to adopt a quota management system. It advised that, should historical activity in the fishery be used to allocated future access, only pipi fishing activities prior to and including 21 December 2006 would be considered. An industry working group was established to advise PIRSA Fisheries on the arrangements associated with the introduction of the quota management system. PIRSA Fisheries formally met with the workshop group four times during 2007 before the new management arrangements were finalised.

To facilitate the process, I established an independent allocation advisory panel comprising a presiding member, Mr David Bright (a retired judge of the District Court), an economic member, Dr Stephanie McWhinnie (University of Adelaide), and an independent fishing industry member, Mr Bob Pennington, from the abalone industry and former president of the Australian Seafood Industry Council. The panel provided advice on the most appropriate method for allocation of the pipi resource among licence holders with an authority to take pipis for commercial purposes in Coorong coastal waters. Industry was invited to comment on the panel's terms of reference before they were finalised. I table the factual brief for the independent allocation advisory panel.

The panel wrote to licence holders and placed advertisements in local newspapers inviting written and oral submissions from interested parties. The notice also advertised a public meeting that was held at Wellington on 8 June 2007. Fifteen written and 13 oral submissions were made, representing 30 of the 32 fishery licences. Written submissions and records of oral submissions were made available to all licence holders in the fishery. The public meeting was well attended and provided interested parties with a further opportunity to provide information to the panel.

The panel submitted its report in July 2007 recommending a mechanism for the allocation of quota entitlements in the fishery. The panel recommended that quota be issued based on a combination of access entitlements and catch history over a period of 3½ years at a ratio of 32:68 (access entitlement to catch history). I table a copy of the panel's report.

I wish to point out that the panel considered a number of claims that individuals were frustrated that a variety of personal circumstances affected their ability to fish to their full potential and a concern about the impact this would have on the final allocation determination. The panel commented, and I quote:

In the end it was our view that various personal problems we were told about were so widely spread that very little could be done to remedy one, except at the expense of another.

This highlights the very issue of quota allocation—that is, any distribution or any change to that distribution has the potential to impact on every licence holder. It is impossible to satisfy all of the claims of participants in the fishery. I accepted these recommendations and advised industry of the decision. Copies of the report were provided to industry.

During August and October 2007 submissions were received from licence holders on a range of issues associated with the allocation decision. On 17 October 2007 a briefing for all members of parliament on the introduction of a quota management system for Goolwa cockles was held in the Balcony Room at Parliament House.

As a testament to my desire to make this decision as fair, transparent and inclusive as possible, I chaired a meeting of local parliamentary members and all licence holders at Parliament House on 24 October 2007. At this meeting a number of unanimous decisions were made on the allocation mechanism and the quota management system for pipis. This included the quarantining of 75 tonnes of quota to address exceptional circumstances cases, and that an Exceptional Circumstances Panel would be established immediately to consider applications of hardship. Following this meeting, a letter was sent to all licence holders clearly articulating the nine unanimously agreed decisions. I seek leave to table that letter. The Exceptional Circumstances Panel met on—

Mr Venning interjecting:

The Hon. R.J. McEWEN: This is a pretty serious matter. If I was you, I would keep my gob shut, to be honest. At the end of the day this is seriously embarrassing for some people on your side of the house so we ought to work through this in a professional way. I compliment the new shadow minister on the way he has worked with me on this. This is a serious issue and we need to work through it, find a solution and get on with things. So I am not interested in you interfering, thanks very much.

The Exceptional Circumstances Panel met on 12 November 2007 to consider submissions regarding quota allocation in the fishery. It was chaired by myself and comprised the local parliamentary members for Hammond and Finniss, with two fishing industry representatives, Mr Gary Hera-Singh and Mr Rodney Ayres. The member for MacKillop was an apology and did not attend. It was agreed that additional quota units should be allocated to six licence holders, based on their exceptional circumstances applications

In December 2007 PIRSA Fisheries advised licence holders of the proposed new quota management arrangements, and that a total available commercial catch of 1,150 tonnes had been agreed with the industry working group. Licence holders' appeal rights under sections 111 and 112 of the Fisheries Management Act 2007 were outlined. A key point is that no formal appeals were ever made in relation to the process.

Since the regulations were made on 13 December 2007, a number of licence and quota transfers took place with significant economic investment in the fishery. The removal of the quota management arrangements, which were in operation for an entire fishing season, have placed the pipi fishing industry in complete economic and social disarray and have had significant financial impacts on licence holders. Domestic and export contracts have been cancelled as a result of not being able to guarantee supply because there is a vacuum of management arrangements. Uncertainty has left the fishery without any fisheries management arrangements for the upcoming season.

Furthermore, this has occurred against a backdrop of escalating sustainability concerns for the fishery. The total allowable commercial catch was set on the first year of the quota system at 1,150 tonnes. However, licence holders were only able to catch 610 tonnes. Industry has agreed that the total catch limit for the fishery for the upcoming season should be 600 tonnes, irrespective of the management system that is in place. It was also noted that it is possible that if catch or catch rates do not show signs of improvement in the coming season, further cuts may be necessary to protect the stock.

Following the disallowance, I have met with members of this house and members from the other place. I have written to the Leader of the Opposition and the shadow minister requesting an alternative working solution to the matter. The response provided by the shadow minister was as follows:

The current party position remains consistent with the disallowance.

It further states:

It is entirely your decision as minister to implement regulations or not in relation to the fishery. The Liberal Party will consider new regulations if and when they are presented to parliament and will review their position at that stage.

It is important to point out that the shadow minister has worked honourably to provide a solution to this problem. However, he has been let down by his own party which refuses to provide an alternative management arrangement. His tireless attention to this matter resulted in an email being sent at 9.44pm last Sunday night, 26 October 2008, with two options he wished to explore. The first was redistributing quota from the non-active fishers to active fishers (a position vehemently opposed by members in the other place) and, secondly, selecting two representatives from the active and non-active fisher sectors, together with an independent mediator, to derive an alternative solution.

While I thank the member for his effort, neither of his options will realise an outcome before the commencement of the season, although I do intend to discuss further with him his second option as soon as possible. As minister, I have an obligation under the Fisheries Management Act 2007 to protect the sustainability of the pipi fishery. As such, I wish to advise the house of the following management arrangements for the Lakes and Coorong Pipi Fishery for both commercial and recreational fishers.

Commencing 1 November 2008, commercial access to the fishery will be controlled with a total catch limit through licence conditions. Individual catch limits will be endorsed on licences and will not be transferable. Comprehensive details of the endorsements will be provided to all licence holders. Endorsements will be consistent with the arrangements implemented last season, with adjustments to recognise permanent transfers made during the past 12 months. Endorsements will also recognise the reduction in total allowable catch from 1,150 tonnes to 600 tonnes.

Commercial fishers will be prohibited from taking pipis from the Goolwa beaches. These arrangements will remain in place for 12 months whilst a regulatory solution is developed with the assistance of the shadow minister. Recreational fishers will be prohibited from taking pipis from the Coorong and are requested to observe a voluntary bag limit of 300 pipis until such time as regulations prohibiting the taking of more than 300 pipis are tabled.