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You are here: Fisheries » About Fisheries » Strategy and Policy » Future Fisheries Strategy: Proposals for Reform Paper » Future Fisheries Strategy: Proposals for Reform

Future Fisheries Strategy: Proposals for Reform

October 2011

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Overview

The Department of Primary Industries (DPI) is developing a Future Fisheries Strategy to guide the way that Victoria's wild harvest fisheries are managed for at least the next 15 years. This paper sets out the proposals for reform that are being considered for inclusion in the strategy. We are now seeking public comment on the proposals to inform the preparation of the final strategy.

The current rules governing Victoria's commercial, recreational and Aboriginal fishing have evolved over time to take advantage of harvesting opportunities and to address a range of risks. However, the overall set of rules has become too complex and restrictive in some areas and ineffective in others.

We have now reached a point where these rules limit the most productive and efficient use of the community's fisheries resources, impede opportunities to adapt to major changes in our population, market demand for seafood and climate variability. Additionally, the opportunities are limited for fishers and other interested people to get more effectively involved in management of their fishing activities and the broader management of fisheries.

It is apparent that the existing arrangements for gathering necessary information and to make decisions about the management of our fisheries is impeding efforts to re-build some fisheries and to realise greater social and economic benefits for the Victorian community. There is an opportunity to describe fishers' entitlements more clearly so that these are more secure, and streamline our management systems. Cutting red tape is a major driver for reform.

We have identified ten key areas for reform in this paper:

• Focussing the objectives and principles for managing fisheries.
• Developing four clear policies to meet the objectives in the important areas of:
  • sharing our fisheries amongst commercial, recreational and Aboriginal fishers;
  • specifying the way that fisheries will be harvested on a sustainable and productive basis;
  • strengthening fishers' entitlements to access fisheries; and
  • improving the opportunities and arrangements for fishers and other interested people to get more involved in managing their fishing activities and fisheries.
• Strengthening three essential management processes to meet the objectives and support implementation of the other policy reforms, in the areas of management planning, compliance planning and the collection, use and reporting of information.
• Improving two areas of funding - contributions to management (cost recovery) and resource rents.

The diagram below represents how the major reform areas relate to each other.

FRAMEWORK FOR MANAGING A FISHERY:
1. Set total sustainable catch:	All sectors
2. Allocate % shares:	Commercial	Recreational	Aboriginal
3. Access entitlements:	Limited access (commercial entitlements)	Open access (licensing applies)	Traditional owners
4. Harvest strategy:	Harvest managed within specific limits and targets, with performance indicators, and clear decision rules.	Harvest managed within general limits and targets, with clear decision rules.	Strategy design dependant on scale of fishery and nature of access.
5. Management tools:	Output or input controls	Input controls (eg size, bag limits)	Input controls
	Management planning, involving stakeholders and underpinned by cost recovery

The final Future Fisheries Strategy will be delivered under an implementation plan that schedules the more detailed reform work, starting in 2012.

The first steps would be the amendment of the Victorian Fisheries Act 1995 (if required) and the development of major strategic policies. A new management plan and regulatory arrangements would then be prepared progressively for each fishery over several years, in line with the new objectives and policies.

Commercial, recreational and Aboriginal fishers and other people with a relevant interest will be offered the opportunity to be closely involved in the development of the policies and the preparation of the new fishery management plans.

The two most important areas for reform are the development of the new objectives and principles, and establishment of effective resource sharing arrangements.

The proposed objectives and principles set out in this paper are based on a resource management approach that prioritises the protection and harvest of wild harvest fisheries as "natural assets". These also reflect an approach to regulation that is enabling and incentive-based, with a deliberate move away from a prescriptive and rule-based approach.

The lack of a resource sharing framework has been identified as a major deficiency in the current fisheries management framework, both by DPI and stakeholders. It is the major challenge in fisheries management worldwide. It is proposed that a framework be inserted into the Fisheries Act 1995. This framework would be based on the principles of using current shares to determine initial allocations, maintaining each sector to within its proportional share, and developing mechanisms for adjustment between the sectors in the longer term.

The resource sharing framework needs to be underpinned by a stronger definition of access entitlements for fishers, harvest strategies setting clear targets and limits, and a management plan framework that better involves stakeholders in formulating management arrangements and services to achieve the outcomes sought. These stronger roles for stakeholders would require support through improved governance for organisations, capacity building and education.

DPI has been progressively improving its fisheries compliance program to more effectively balance and strengthen its education and enforcement activities. This includes delivering preventive activities to educate fishers and the broader community about good fishing practices and fisheries rules, including responding to the needs of Victoria's diverse multicultural fishing community. We have also sharpened our enforcement program by conducting overt and covert operations, investigations and prosecutions to target illegal fishing based on the collection and analysis of intelligence about fisheries crime. The proposals in this paper will bring these various actions together in a more integrated way to underpin any management changes following the review of each fishery, with scope to strengthen the compliance provisions in the Fisheries Act 1995.

Actions will be required to obtain the information essential to support good management decisions. A review of funding arrangements, including the existing contributions made by fishers, will be undertaken to identify the best way to resource the actions necessary to improve the management and performance of each fishery.

The reform areas are designed as an integrated package with complementary and reinforcing parts to achieve the objectives and principles for the future management of Victoria"s fisheries. There is scope to vary or fine-tune the overall reforms to achieve the outcomes sought.

We welcome your feedback on the reform proposals, including any suggested improvements or alternatives. A submission form is provided at Attachment 1 to help anyone who would like to contribute their ideas. We will accept written submissions up to 1 March 2012 (extended from 30 November 2011).

What is the Future Fisheries Strategy?

DPI is reviewing the way that Victoria's fisheries are managed, with a view to identifying ways to significantly improve biological, economic and social outcomes and to respond to emerging challenges, including changes associated with demographics, global seafood markets and climate.

The Proposals for Reform paper has been prepared to establish the case for reforming the way that our fisheries are managed, and to propose new objectives and principles to guide the management of fisheries for at least the next 15 years. Our clear intention is to strengthen the commercial, recreational and Aboriginal fishing sectors and to remove unnecessary red tape.

We established a Stakeholder Reference Group to help us identify key issues and to get some initial feedback on the types of reform options that we consider are likely to be necessary. The Stakeholder Reference Group was not requested to endorse the reform options presented in this paper.

We are now seeking to discuss the reform proposals with a wide range of people involved in the commercial, recreational and Aboriginal fishing sectors in key regional areas and other groups with an interest in the management of Victoria's fisheries. We welcome written comments from the broader community until 1 March 2012 (extended from 30 November 2011). We are particularly seeking feedback on a number of key questions, as listed in Attachment 1.

The feedback received will be used to develop the Future Fisheries Strategy, which is scheduled to be finalised in 2012. An implementation plan will be prepared to show how the priorities identified in the strategy will be implemented in an orderly way for each fishery over the next five years.

Why reform?

Fisheries in Victoria are managed under the Fisheries Act 1995 (the Act) and the Fisheries Regulations 2009 (the Regulations). A long history of management decisions has maintained Victoria's valuable fisheries resources and delivered positive outcomes for the community. Difficult decisions have been made to achieve these outcomes in some cases.

However, the arrangements in place under this legislation are a composite of many different decisions made at different points of time. The resulting system is an extensive set of rules and processes which are, in totality, complex, restrictive and in several cases limit the ability of fisheries to be managed efficiently and to adapt to change. As the fisheries management system has evolved, it is no longer connected to a clear statement of what is to be achieved and why, the scope and priorities for fisheries management in Victoria and the role that government will play in different parts of the fisheries management process. It is timely to undertake a review to identify the objectives and strategies of fisheries management in Victoria, and to implement the reforms required to achieve them.

The Victorian Government has a broad regulatory reform agenda aimed at improving Victoria's productivity, competitiveness and labour force participation¹. Reform of the regulatory environment is part of the agenda, to avoid imposition of unnecessary burdens on business and the community that could slow economic growth, discourage innovation, adversely affect investment and lead to fewer jobs, higher prices and reduced consumer choice.

Specific issues raised by the Victorian Competitiveness and Efficiency Commission include consideration of the use of market-based approaches to regulation, the availability of online services by regulatory agencies and the impact of privacy and confidentiality requirements on the efficiency and effectiveness of delivering regulatory services. The reduction of red tape is a broad objective.

Victoria's fisheries

Victoria's fisheries are diverse and geographically extensive. Our waters provide some of the world's finest seafood, as well as world-class recreational fishing opportunities. Victorian waters include inland lakes, river systems and water storages, estuarine and marine inshore waters and marine offshore waters out to a 3 nautical mile limit. By agreement with the Commonwealth of Australia, the State of Victoria also manages some fisheries beyond this limit.

Victorian wild fishery resources are harvested by the commercial, recreational and Aboriginal fishing sectors. Aquaculture is also undertaken in a variety of offshore, coastal and inland facilities. Fishing activities in all these sectors in Victorian waters are managed under the provisions of the Act and the Regulations. Other human activities (e.g. foreshore management, agriculture, marine pests and water management) that may directly or indirectly affect fish habitats, fishery resources or the quality of fishing are managed by other legislation.

The Act provides the legislative framework for the regulation and management of Victorian fisheries. Detailed management arrangements are set in the Fisheries Regulations, including licensing and quota management requirements, gear restrictions, catch limits, size limits, closed seasons and closed areas.

Commercial fishery

The methods used to commercially harvest fish and shellfish from Victoria's waters depends on the target species. For example, abalone are prised from rocks by divers, scallops are caught in dredges, rock lobsters are caught in baited pots along rocky reefs, some finfish species are targeted using nets and other species are caught with hooks.

Commercial fishing has been managed under various pieces of legislation since 1859, primarily by input controls such as limits on the number of commercial licences, fishing equipment restrictions and area/seasonal fishing closures. Output controls are also in place for some commercial fisheries including legal minimum lengths and, more recently, quota management systems for some fisheries. Both types of control are in place in endeavour to protect fish stocks from excessive fishing pressure. There are currently over 800 issued Victorian commercial fishery access licences and permits.

Quota management was introduced for the Victorian abalone fishery in 1988, the scallop fishery in 1998 and the southern rock lobster and giant crab fisheries in 2001. The primary catch control tool for these fisheries is intended to be individual quotas, although some legacy input controls remain in force. Each licensed commercial fisher is annually assigned a proportion of the Total Allowable Commercial Catch through transferable quota units.

Over the past five years, commercial fishery production in Victoria has ranged between 4600 and 6400 tonnes per year². The annual economic value of the commercial sector is estimated to be $60 m on average over the last five years³. An additional $50 million worth of seafood is landed in Victorian ports from Commonwealth and Tasmanian fisheries⁴. Approximately 8000 Victorians are dependent on seafood landed or produced here for the bulk of their employment⁵. The abalone and southern rock lobster fisheries are the most valuable fisheries, worth $22 m and $14 m respectively³. The majority of product from these fisheries is exported.

Production for bay and inlet fisheries is estimated to be in the vicinity of $8 m annually,³. These relatively small scale fisheries provide a mainstay for locally caught scalefish seafood to the domestic market. 27% of the Victorian public eat fish more than once a week ⁶, and surveys suggest that two thirds would prefer to buy locally caught over imported fish⁵.

Other fisheries such as eel and giant crab are also important in providing employment through relatively small industries in regional centres.

The Victorian commercial fishing industry has identified some major challenges ahead. These include adapting to competition with imported products, energy costs, exotic pests and diseases, changing market preferences for seafood, and sharing access with other resource users, and the effects of climate variability.

Aquaculture

Aquaculture is an important part of the Victorian commercial seafood industry. However, as the aquaculture industry has its own strategic plan, it is not within scope of the Future Fisheries Strategy. Nevertheless, there are many overlap issues between fisheries and aquaculture, such as the collection of broodstock, that are relevant to the Future Fisheries Strategy.

Recreational fishery

The Victorian recreational sector is highly valued from a social and economic point of view. Around 271,000 recreational licences were sold in 2010. The number of participants in the recreational sector is likely much higher, as persons under 18 and over 70 and concession card holders are exempt from holding a licence.

There are a number of freshwater, estuarine and marine recreational fisheries. The most popular freshwater fisheries are introduced species such as trout and redfin, although anglers are increasingly targeting native species such as golden perch, Murray cod and Australian bass. All of these fish species, other than redfin, are stocked regularly by DPI to improve fishing opportunities for anglers. Yabbies and spiny freshwater crayfish are also popular but not stocked by DPI.

Victoria¡¦s bays, inlets and oceans provide some of the State's most productive recreational fisheries for species such as snapper, King George whiting, flathead, bream, calamari and Australian salmon. The recreational sector catches a significant portion of the total volume of these species, in cases such as snapper exceeding the commercial catch. Other popular species such as scallops, abalone and southern rock lobster are also caught by recreational divers. Several bays and inlets along the coast have been established as areas for recreational fishing only following cessation of commercial fishing. For example, Westernport Bay was closed to commercial netting in 2007.

Aboriginal fishery

Fishing has historically been an important activity to Aboriginal communities throughout Victoria. Aboriginal people have names for individual species of fish, and also for different life stages of some of the larger species⁷. Many groups have totemic species, local language names and stories associated with these species. Traditional Aboriginal fishing techniques have both originated from parts of Victoria and been incorporated over time from elsewhere⁸. Fishing practices have been maintained for thousands of years and in some instances supported large semi-permanent communities. The eel fishery is one example of an important resource for Aboriginal communities and greater access to this fishery is currently of great interest to both the Aboriginal and commercial fishing sectors.

Customary fishing (excluding for ceremonial purposes) is treated currently as recreational fishing under the Act. The Department of Primary Industries is finalising an Aboriginal Fishing Strategy after an extensive public consultation process, which has the key objectives to:

• Recognise Aboriginal customary fishing rights.
• Encourage the involvement of Aboriginal communities in the sustainable management of fisheries.
• Foster better economic opportunities for Aboriginal people in fishing and related industries.

Predicted future trends

Victoria's current population is projected to grow by over 2 million by 2036, with the majority of growth coming from international migration. As Victoria's population increases the demand for access to marine resources is expected to increase. These demands include access to seafood, recreational fishing experiences and non consumptive use of marine resources such as diving/snorkelling and coastal visitation.

It is not clear whether participation rates for recreational fishing in Victoria (as a percentage of population) will increase in line with population growth. There is some evidence to suggest that there is a trend towards decreasing participation rates observed across Australia in recent years, particularly in metropolitan areas⁹. However, there is clear evidence to show that the total number of licensed recreational fishers is increasing.

Victoria's diverse multicultural community groups will also change the types of demand on our marine resources and our fisheries management services. Currently 44 percent of Victoria's population were either born overseas, or are first generation Australians. It is apparent that people from various cultural backgrounds have significantly different expectations and preferences with regard to accessing fisheries, which range from subsidence food collection to sport fishing. In practice, these differences are often reflected in the fish species they target, the fishing methods they use, and pattern of fishing either as individuals or in family or community groups. However, many of Victoria's current fishing rules do not adequately provide for these legitimate fishing interests, although some initial actions are underway to tailor the delivery of fisheries communication and education programs for these communities.

Additionally, consideration needs to be given to the potential changes in fishing patterns and impacts on fisheries due to the "seachange" phenomenon and the movement of the baby boomer generation into retirement.

Victoria is a hotspot for climate variability and change. Strengthening of the East Australia current is causing water temperatures in the south east marine region to rise. We are starting to see shifts in the distribution and range of some species, such as urchins and pelagic fish, in our marine fisheries in southeastern Australia. Inland and estuarine fisheries have experienced the impacts of prolonged flood, drought and bushfires.

Seafood is a global commodity and the commercial sector is subject to the economic forces of the international marketplace. Major considerations are the value of the Australian dollar, the availability of cheap imported products, competition with aquaculture product in international markets and the current reliance on a narrow range of markets (predominantly Asia). Balanced against these concerns is the continuing high demand for seafood.

In summary, fisheries management needs to be flexible and adaptive as well as cost effective to sustain and share the resource under changing conditions. Many of these variables cannot be controlled by fisheries management. However, these variables highlight the need to ensure that fisheries policy and regulatory arrangements provide secure and flexible opportunities for the fishing sectors to adapt to change. The required response will need to include the careful measurement of relevant information so that issues can be identified and responses informed by evidence.

What is the problem?

Victoria's fisheries are valuable resources and our associated fishing sectors are important parts of our community and economy. Our fisheries have been well managed and Victoria has in many ways been innovative in its approach to fisheries management. However, there is room for substantial improvement.

First and foremost, the lack of a strategy is a problem. Victoria does not currently have a clearly documented statement of the vision for managing its wild harvest fisheries. We are looking to align our policy development, management and service provision with explicit and structured objectives so that the fisheries management system is coherent, consistent, integrated and cost effective.

A range of specific issues impact on sustainability, value from use and how we manage fisheries:

Sustainability

• activities external to fishing impact on fisheries habitat and water quality and adversely impact on production;
• some key fish stocks are depleted, including our most valuable fisheries (abalone and rock lobster);
• current regulatory arrangements often do not effectively constrain catch or effort;
• sustainability limits and standards are not consistently prescribed; and
• core catch and effort information to support sustainability is poor for the recreational sector

Value from use

• economic returns from a number of commercial fisheries are low relative to the value of the product or potential value of the fishery;
• commercial entitlements are often unnecessarily complex, impede transferability and adaption, and are therefore economically inefficient;
• the rights and interests of Aboriginal fishers are poorly recognised;
• fisheries stakeholders are not clear about the nature of their entitlements; this uncertainty, including clarity of allocation between the sectors, reduces access security and impedes constructive engagement in initiatives to improve management and results in wasteful lobbying; and
• resource sharing arrangements with other jurisdictions are inconsistent

How we manage

• arrangements to enable stakeholders to collaborate on fisheries management and make decisions with appropriate safeguards are insufficient;
• we do not have clear management plans outlining specific targets, decision rules to meet those targets, and services designed to achieve those targets, or, where we do have management plans, they are inconsistently applied;
• current cost recovery arrangements only partially recover costs from those users of the resource that benefit from fisheries services, and the system is not sufficiently transparent or designed to provide for appropriate accountability for the costs of service provision;
• overall, the current regulatory arrangements are poorly designed to adapt to pressures to be faced as a result of population growth and demographic shifts, climate variability and changes in market demands; and
• measurement and evaluation of the performance of the fisheries management regime is limited - this impedes learning and responsive decision making.
  

How should we tackle the issues?

The Future Fisheries Strategy will set out a vision for fisheries in Victoria for at least the next 15 years of fisheries management, the underlying policy and regulatory approach, what we are trying to achieve (objectives) and how (governance principles). It will clarify the scope of fisheries management in Victoria and the government's role and core services in managing Victoria's fisheries. It will set out major reform directions.

The accompanying implementation plan will outline how the detailed reform work will be done. The initial implementation phase will involve amending the fisheries legislation and writing the core strategic policies. This work will start in early 2012, subject to the Victorian Government's overall legislative program.

The amended legislation and new policies will provide the basis for progressively reviewing each fishery, starting in the second half of 2012. These reviews will consist of evaluation of the performance of each fishery and the development of revised arrangements, where necessary, in accordance with the principles, policies and processes set up by the strategy, the legislation and the core strategic policies. This work will be undertaken in close consultation with all relevant fisheries stakeholders.

The following diagram shows how the different components of the process fit together.

FUTURE FISHERIES STRATEGY Sets direction
	I M P L E M E N T A T I O N
FISHERIES ACT 1995 Provides framework to pursue direction. Will be amended if necessary. + CORE STRATEGIC POLICIES To guide fishery reviews and development of revised arrangements
FISHERY REVIEWS Evaluate performance of each fishery and revise arrangements where necessary to meet objectives. Develop and implement new management plans and regulatory arrangements for major fisheries.

Scope and core services

The Future Fisheries Strategy will set out regulatory philosophy underpinning our approach, the objectives and principles of fisheries management and key policy directions in relation to the reform areas that have been identified.

There are decisions to be made about the strategies for achieving the objectives and the level of investment in those strategies. For example:

• What is the role of fisheries management in ecosystem protection? The direct impact of fishing on threatened, endangered or protected species is definitely within the scope of fisheries management. However, there are a range of issues that impact on fishing that DPI does not directly manage but may be able to influence. For example, how should impacts on marine and freshwater environments that support fisheries by various land uses, water management, waste disposal and the development of other marine industries be managed?
• How do we deal with aquatic pests and disease in terms of risk to and impact on fisheries? What are the institutional arrangements within government to co-ordinate biosecurity functions?
• What is the role of fisheries management in developing a sector? The role of the government and fisheries managers in investing in, or actively engaging in, fishery development activities need to be agreed. Examples of fishery development activities include supply chain management, and recreational fishery development such as stocking and infrastructure, much of which is currently funded through Recreational Fishing Licence revenue.

Major areas for reform

We have identified ten major areas requiring reform:

Setting direction

1. Setting a clear overall objective to optimise the value gained from our fisheries, and a sub-set of objectives and principles for achieving that;

Policies that underpin direction

2. Establishing resource-sharing arrangements that clearly define the amount of fish that can be harvested by the commercial, recreational and Aboriginal fishing sectors, and that are sufficiently flexible to allow for adjustment in a fair and efficient way over time;
3. Preparing harvest strategies that clearly describe the sustainable and productive level of fish catches and how to make decisions to maintain stocks at those levels;
4. Strengthening access entitlements to be simple and more secure for all fishing sectors, and to be more flexible and adaptive;
5. Developing engagement and governance arrangements that enable stakeholder organisations to take on a greater role in fisheries management, taking account of individual entitlements and the government's obligations for the use of a community resource;

Processes that underpin implementation

6. Preparing management plans that clearly describe the management arrangements and services that will meet the management targets and limits, following an open planning process;
7. Ensuring fisheries compliance through regulatory and preventative approaches that encourage the voluntary adoption of good fishing practices, but targets strong enforcement and sanctions against illegal fishing where needed;
8. Obtaining the knowledge and information on that will be required to make good decisions about our fisheries and fishing, taking account of risks and available resources- including biological, ecological, social, economic and behavioural information;

Funding reform

9. Reviewing funding arrangements to better recognise the contributions to be made by fishers towards the cost of the science, management and compliance services that support their fishing activities, taking account of broader public benefits and providing effective opportunities for fishers to engage in decisions on the nature and extent of services; and
10. Collecting resource rents when establishing new commercial fisheries.
    

1. Objectives and governance principles

A strategy for the next 15 years of fisheries management in Victoria must explain why we are pursuing the objectives we are pursuing, define what we are trying to achieve, and the principles that guide how we achieve it.

The objectives listed in section 3 of the Act provide a general description of most of the important issues in fisheries and the competing interests that need to be balanced in making fisheries decisions. However, these objectives do not provide a structure for balancing competing interests, do not provide strong direction to be applied in different situations and do not establish any specific approach to regulation. A proposed set of revised objectives and governing principles has been developed to address these deficiencies ¡V see following page and explanatory notes in Attachment 2.

DPI proposes a change in underlying philosophy from a style of regulation that is rule-based, prescriptive and reactive to one that is incentive-based, enabling and strategic. It is also about a shift to better overall performance measurement to collect information and report on how Victoria¡¦s fisheries are tracking against the objective of optimising benefit for the community as a whole. The public need to have confidence that Victoria¡¦s fisheries are being managed effectively and efficiently, and performance measurement enables public scrutiny.

This diagram represents the steps in fisheries management being:

• Protect the asset base, being healthy productive ecosystems.
• Secure the fish, by ensuring long term sustainability of fished stocks.
• Share the fish between users of the resource.
• Grow the value of the resource by investing in fishery development, which can include strategies for making more from the same volume of resource, or growing the volume of the resource.
• Arrangements should involve - and be relevant to - stakeholders.
• Overall performance should be measured to ensure maximum benefit across economic, social and cultural values, with community expectations informing the process.

The steps above are hierarchical ¡V that is the resource cannot be shared and grown unless steps are taken to maintain productive ecosystems and ensure stock sustainability.

Draft objectives and governance principles

Overarching objective:

Optimise the commercial, social and cultural value to Victoria derived from the use of fisheries resources and associated ecosystems.

Specific objectives:

1. Protect ecosystems that support the productivity of fisheries.
2. Manage fish stocks within sustainable limits to provide for the reasonably foreseeable needs of future generations.
3. Establish arrangements to optimise the value that the commercial, recreational and Aboriginal fishing sectors achieve from their allocated share of the resource, within the limits of objectives 1 and 2 above.

Governance principles:

1. Recognise the long-term sustainability of the fisheries resource as a priority.
2. Enable participation by fishers and other relevant stakeholders in fisheries management, taking account of the respective responsibilities of government, fishers and the broader community.
3. Establish arrangements to explicitly allocate initial shares of the resource to the fishing sectors and enable resources to move to the highest value use.
4. Maintain open access to fisheries for recreational fishers of all fishing abilities, subject to satisfying sustainability objectives and maintaining the catch within the recreational share of the resource.
5. Provide fishers with secure access entitlements with corresponding responsibilities for which they can be held individually and collectively accountable.
6. Policy should be formulated and implemented to respect existing entitlements.
7. Ensure that the management of fisheries and the provision of associated services are efficient, effective and responsive using regulatory approaches that are enabling and incentive-based.
8. Make decisions based on the best available information to ensure sustainable and equitable use of fisheries. Absence or uncertainty in information should not be used as a reason to postpone decisions to ensure environmental sustainability.
9. Users of fisheries resources should pay for the cost of efficient services from which they benefit and services that address risks created by their activities, taking account of public benefits.
10. The use of common pool resources should provide benefits to Victoria.

2. Resource sharing arrangements

Fisheries are common pool resources that can physically be accessed by anyone who is able to fish. Fisheries laws exist to regulate the legal access to those resources. The resources are often valued by more than one of the commercial, recreational and Aboriginal fishing sectors. Therefore, there is competition for fish and competition for legal access to go fishing. Regulations are put in place to limit this access and constrain catches within sustainable limits.

The allocation of an explicit share of the resource to each sector within a fishery would provide a number of benefits. It establishes a clear target for managing each sector by requiring that fishing be limited to within the allocated share. Second, it provides security to each sector that their allocated share will be maintained and will not be arbitrarily taken away.

The anticipated benefit of this security is that sectors can engage constructively in fisheries management with a long term view without the fear that an arbitrary decision will undermine their efforts by removing their access. This has positive impacts on sustainability of the resource as well as the investment environment. In the absence of this level of security, sustainability measures and investing in the development of a fishery tend to be avoided.

The lack of a resource sharing framework also limits the scope for adjustments in allocations over time so as to maximise value from the resource. Without a framework, this can only be done in an ad hoc way, leading to reactive decisions and often creating winners and losers.

It is therefore a fundamental part of the proposed reform package that a resource sharing framework be incorporated into the Fisheries Act 1995. A proposed framework is set out below.

Proposals for reform

• Establish a resource sharing framework in legislation, requiring that management plans for a fishery explicitly allocate shares of the resource to each sector, with the initial allocation based on the best estimate of current shares. Other features of the framework are:
  • Recognise Aboriginal customary fishing as negotiated through agreements with Traditional Owners
  • Any changes to overall catch or effort implemented in the fishery will be applied in proportion to specified shares. If Total Allowable Catches are increased or reduced in response to the changing abundance of a species, these adjustments will be distributed to the recreational and commercial sector in proportion to their share.
  • Require that management plans will set out how any future adjustments in shares may occur. Prescribe that any adjustment in which the share of one sector is re-allocated in favour of another sector will be offset in a fair and complete way.
  • Set a total catch for a fishery each year and within that set a commercial catch limit and a recreational catch limit. Aboriginal customary fishing will be fully recognised in this catch setting process. (It is important to note that the setting of a total catch for each sector does not imply that the sector will be managed through quota or other output controls).
• Develop a resource sharing policy to guide the implementation of the legislative framework and in particular guide the development of management plans with resource sharing arrangements in them.
  • The resource sharing policy will consider the best methods for adjusting shares. Traditionally changes in resource shares have been imposed and then compensation paid, but a preferred model would support other methods of adjustment based on involving all relevant sectors in reaching a solution such as mediated outcomes or trading across sectors. The practicalities of these models need to be tested and explored in developing the Resource Sharing Policy.
  • Sharing across jurisdictions also will be addressed in the policy for fish species that cross State and Commonwealth boundaries, noting that this will require the cooperation of other fisheries agencies to progress agreements under the national Resource Sharing Memorandum of Understanding.
  • The policy will address the types of information to be used to estimate initial shares, including the level of assessment needed for different fisheries, depending on their value and risk profile.

In addition to the allocation of shares between the fishing sectors, there are other sharing issues between different uses of marine and freshwater environments which impact on access to the resource for fishing and have the same negative effects on access security. These include the establishment of reserves for conservation use (e.g. marine parks), physical access to inland water bodies through land and water management authorities, use of marine areas by other industries (oil and gas, telecommunications, transport) and processes that impact on water quality and ecosystem health (e.g. farming).

Proposals for reform

• Amend the Fisheries Act 1995 to allow the specification of "fisheries production areas" (e.g. seagrass beds) and "recognised fishing grounds" to be given effective protection in land and natural resource planning processes.
• Working with other government agencies, develop a framework to ensure that development of the freshwater and marine environment is done in a strategic way taking into account cumulative impacts of all uses and involving all stakeholders.
  

Case study: Sharing rock lobster in South Australia

The commercial and recreational sectors in South Australia reached an agreement to allocate the resource between them. The recreational share was set at 5.25% and the remaining 94.75 % was allocated to the commercial sector.

Recreational fishing for rock lobster is mostly taken by pot fishing using registered pots, and subject to a range of rules including bag, boat and size limits and a closed season. Commercial fishing is managed under a quota system with an annual TACC being the primary control on catch, with a range of additional rules in place including gear restrictions, size limits and a closed season.

Accurate catch information is collected daily for the commercial sector. A recreational fishing survey is conducted every two years to estimate the recreational catch and effort.

It has been agreed that if the recreational catch exceeds the allocated 5.25%, funds collected for the registration of recreational rock lobster pots will be used to buy commercial quota. The agreement is that the government will facilitate this and any transactions will be on a "willing seller" basis. No adjustment has been necessary to date as recreational catch has gone up and down depending on catch rates, in proportion to their share.

Case study: adjusting shares in the Canadian halibut fishery

Pacific halibut is an important species to recreational and commercial fishers in Canada. The commercial component is estimated to be worth $60 million. The recreational value is currently unknown, but the species is highly valued as a sports fish.

Halibut is a migratory species and the stock is shared with the USA. The International Pacific Halibut Commission has been established to manage the shared stock, and annually allocates a Total Allowable Catch (TAC) to the USA and Canada.

Previously, the Canadian Department of Fisheries and Oceans (DFO) managed this allocation by subtracting an estimated harvest for Indigenous and recreational take, and bycatch from other fisheries, and then allocated the remaining amount as a Total Allowable Commercial Catch. In the early 2000's however, this system changed to give the recreational sector a more explicit share and the ability for both sectors to adjust their shares using market based mechanisms.

After a mediation process, the Canadian Government announced that recreational fishers would be allocated 12% of the annual TAC. It was also announced that each sector would need to develop their own suitable market based mechanism for adjusting shares in the future. The commercial fishery established a non-profit representative organisation to manage any future adjustment, however no body has yet been established for the recreational sector.

In 2003-2004, the recreational harvest was less than the allocated 12%. The commercial representative organisation negotiated with the recreational sector to buy out the remaining allowance at an agreed rate. This money has been paid by the commercial fishery is being held in a trust account until the recreational sector gives advice on how the money should be released.

In recent years the recreational harvest is approaching the 12% allocation and might, for the first time, exceed the allowance. There are two options for managing this - either the recreational sector can arrange to buy allocation from the commercial fishery, or the DFO will need to intervene and introduce additional management measures ( for example reduced bag limits) to keep the recreational catch within it¡¦s allocation. The problem is that the recreational fishing sector does not have a single representative body that can fund and manage the process of trading allocations with the commercial sector. It has been suggested that the government could play this role, by raising recreational licence fees to cover the cost of purchasing commercial allocation, however this issue has not yet been resolved.

This case study highlights the potential for market based resource allocation mechanisms as an alternative way to manage the competition between commercial and recreational fishing when the resource is fully utilised and it is unacceptable to allow recreational catches to continue to grow in an unconstrained way. It has the potential to provide a way to enable recreational fishing to grow, whilst providing a choice about either cutting bag limits or buying commercial quota. However, the trading system can only work well if the governance structures are well developed - it needs to be clear what entity will be able to buy, hold and trade shares on behalf of the recreational sector. Information about the level of take from each sector is also critical to make this system work

3. Harvest strategies

Harvest strategies are an essential component of an effective management plan. These are the part that actively shapes decisions about harvest. For example, the setting of Total Allowable Commercial Catch for a commercial quota fishery is made in accordance with the harvest strategy for that fishery. Harvest strategies are fundamental to ensuring sustainability and for meeting targets for fishery performance.

A harvest strategy for a fishery should have the following components:

• Performance indicators that provide a measure of fishery abundance now and in the future;
• Reference levels that establish target and limit reference points for each performance indicator to define desirable and undesirable fishery performance;
• Decision rules that establish actions for responding when reference levels are triggered; and
• Data and assessment needed to support the strategy and associated costs. (The costs of data collection and analysis influence the choice of performance indicators and decision rule design.)

Without harvest strategies, critical decisions for the fishery are more likely to be ad hoc and likely to be the product of compromise rather than being evidence-based and operating within acceptable levels of risk. A harvest strategy sets out a structured pathway for meeting objectives in a consistent, transparent and principled way. It allows for management to adapt to observed changes in the fishery according to defined criteria. Importantly, a robust harvest strategy that is consistently implemented can provide greater certainty for all fishing sectors and individual fishers.

Harvest strategies for Victorian fisheries currently range from sophisticated decision rules to non-existent, with various levels of adherence to the decision rules in those fisheries where harvest strategies exist. And, while no Victorian fisheries are classified as "overfished", some of our major fisheries are substantially below desired levels. This suggests that, in some cases, the decision-making framework in those fisheries is inadequate to adapt to change and avoid those declines or fluctuations. Climate variability predictions suggest that fisheries will have to adapt to changes in the physical environment in the future, emphasising the need for adaptive management regimes.

It is proposed that a Harvest Strategy Policy be developed to improve the standard of harvest strategies and the consistency in developing and applying them.

Proposal for reform

• Develop a Harvest Strategy Policy to guide the development and implementation of harvest strategies that are consistent, effective and adaptive to change.
• Base the Harvest Strategy Policy on a set of design principles that include:
  • Development and implementation with opportunities for relevant stakeholders to participate in a transparent and inclusive way;
  • Design relevant to the species it controls. In particular, the harvest strategy should take into account the life history and spatial distribution of the species;
  • Design on a whole stock basis. For stocks managed by multiple jurisdictions under agreed resource sharing arrangements, harvest strategies should explicitly recognise and integrate with management of the stock by other jurisdictions;
  • Design to build stock resilience to changes in environmental or climatic conditions
  • Development using a risk-based approach to fishery management planning. This includes the definition of acceptable levels of risk for the fishery and linking the policy to periodic fishery status reporting;
  • Binding targets are to be set for fishery performance;
  • Decision rules are to be designed with reference to performance indicators and reference levels and to respond to measured changes in those indicators; and
  • The ongoing costs of implementing a harvest strategy are to be explicitly identified and taken into account in design. Harvest strategies are to be designed to be as cost-effective as possible, taking into account the acceptable levels of risk for the fishery and the trade offs between catch, cost and risk
    

4. Access entitlements

The design of access entitlements to a fishery is an important part of the overall reform package. Each sector would be allocated an explicit percentage share of the resource under a resource sharing framework. Access entitlements are then specifically designed for each sector to specify who can harvest the resource and for what purpose. Access is open to anyone for the recreational sector, a limited number of access entitlements are issued to harvest fish for commercial purpose, and arrangements are being progressively developed to recognise Aboriginal customary fishing.

Commercial fishing sector

Specification of access entitlements is fundamental to how a fishery is managed and the ability to deliver cost-effective management and economically efficient outcomes. Well-designed access regimes provide positive incentives for those exercising the entitlements to engage in the management of the fishery and invest in protecting and developing the fishery. They establish clear accountabilities for entitlement holders.

There are currently a number of different types of commercial legal entitlement to fish in Victoria. Having a number of systems of access is complex, inflexible and therefore costly to implement. In many cases they do not provide a direct control on catch and place a large regulatory burden on industry. Entry is limited in almost all commercial fisheries, which creates barriers for new fishers to enter the fishery. In those fisheries with quota management, there is no public register of quota ownership which is impacting the trading market for quota entitlements. A well designed and transparent quota system would facilitate trading and adjustment within the sector

Access entitlements will be clearly specified and meet a range of criteria, including:

• relevant to the life history of the species;
• provide a quantitative entitlement;
• flexible (within "standards") and adaptable to environmental change;
• provide incentives for growth, stewardship, innovation and investment;
• simple, cost effective and minimise regulatory burden;
• enable resource sharing arrangements to be effectively developed and implemented;
• aligned or integrated with other fisheries that interact (for example, if a fishery takes bycatch of a species that is a target species in another fishery);
• enable economic efficiency by freeing up entitlements to be divisible and traded between fishermen, allowing adjustment over time to the most efficient fishermen; and
• establish clear accountabilities between owners and operators.

There is a range of management systems applied to commercial fisheries around the world. In Victoria, these include different quota management systems and limited licences combined with input controls. The Victorian fishery is small by international standards and it is costly to run these different systems. It is therefore proposed to review the current systems to refine them to a limited number of preferred regimes.

Based on the criteria above, management systems that regulate according to quantitative outputs or a proxy for quantitative outputs are preferred. For example, quota systems are output controls. Transferable effort units such as fishing days are proxies for quantitative outputs, where a Total Allowable Effort is set each year based on an estimation of the effort that would equate to a sustainable catch level.

Transferable and divisible entitlements are also preferable because they free up the trade of entitlements and allow adjustment within the fishery, without the need for government intervention. Where transferable access entitlements are allocated in a fishery, the need for a separate limitation on the number of fishing licences is removed. In other words, where strong access entitlements are in place through quota or some other system of transferable units, it is those entitlements that should be used to manage the fishery, not other restrictions. Consideration should be given to implementing stronger and simpler access entitlements and when this is done, phasing out limited licensing regimes. In these situations, owners of access entitlements will have a more fluid market in which to transfer their entitlements.

In the transition to any new arrangement, impacts on existing entitlements will need to be carefully considered as part of any process, consistent with the governance principle on page 17 that ¡¥existing entitlements will be respected¡¨. Offsets should be considered if there is an undue impact on current entitlements in the fishery.

For new fisheries, DPI is scheduled to finalise a Developing Fisheries Policy by March 2013 to support the establishment of new fisheries. It is proposed that this policy be developed using the criteria above. In addition to the issues associated with designing appropriate access entitlement regimes for new fisheries, the way that those entitlements are allocated needs to be considered. Specifically, new entitlements could be auctioned or tendered, as a means of allocating to the highest value. (Resource rents would also be collected by using this method of allocation.) However, some fisheries (sea urchins and banded morwong) have already been in the process of being developed (through permits) for some time. In these cases, existing participation will be recognised in accordance with commitments that have already been made.

The task of reviewing the access entitlement regime in each fishery is a substantial task that needs to be done a fishery-by-fishery basis, involving relevant stakeholders. These reviews are proposed to be undertaken as part of the implementation plan of the Future Fisheries Strategy. However, it is proposed that the principles underpinning these reviews are developed (see above) and that an Access Entitlement Policy is agreed prior to the fishery reviews commencing to provide guidance about how to implement the principles.

Proposals for reform

• Develop an Access Entitlement Policy to guide the evaluation of existing access regimes and the specification of new or revised access arrangements.
  • Set out the criteria for evaluating and designing access entitlements.
  • Identify a preferred regime or regimes to be applied, consistent with the criteria above.
  • Consolidate the different quota management systems into one consistent quota management system to be applied to all quota fisheries.
  • Review limited licensing where stronger access entitlements are in place.
• Review the commercial licensing arrangements in the Fisheries Act 1995 with a view to:
  • strengthening the lines of accountability for entitlement owners and operators; and
  • creating more transparency in entitlement ownership, to facilitate transferability of entitlements, including online facilities.
• Include in the Developing Fisheries Policy a requirement that access entitlements in new fisheries are allocated by auction or tender (subject to recognising existing participation).

Recreational fishing sector

Recreational fishing and dependent businesses can greatly benefit from improved resource sharing arrangements and access entitlements that are better defined.

The general aim is to manage the recreational sector to a specified level of catch. Under a resource sharing framework, this would be to manage the sector's take within its share. This is usually done through standard input and output controls, such as restrictions on allowable gear, seasons, size limits and bag limits. These types of tools are applied consistently with the principle to "maintain open access to fisheries for recreational fishers of all fishing abilities, subject to satisfying sustainability objectives and maintaining the catch within the recreational share of the resource".

Special arrangements could be developed for situations where a reduction in fishers' catches would be impractical (e.g. where even a bag limit of one fish per day would be too high). For example, ballots or auctions are examples of allocation methods that are used internationally and elsewhere in Australia for some recreational fisheries as a way to limit the number of recreational fishers and their combined catches. However, such an approach would not support the objective to maintain open access to fisheries for recreational fishers of all fishing abilities, and so would only be considered in situations where sustainability requires it.

An alternative to restricting recreational access would be to establish an arrangement to enable the recreational sector to acquire more of the commercial share in the future on mutually agreed terms, as described in section two on Resource Sharing.

As with commercial entitlements, recreational fishing entitlements need to be designed according to criteria, including that options be consistent with the life history and spatial distribution of the species, minimise regulatory burden, and be considered in terms of how well they facilitate resource sharing arrangements. Two important criteria that are specific to the recreational sector are that access entitlements facilitate the collection of information from the sector and facilitate communication to the sector. These criteria are important given the large number of people with diffuse interests that make up the recreational sector.

Collecting catch and effort information and communication with the sector can be more effective and less costly depending on the design of the access regime.

Proposal for reform

• Develop arrangements to manage the recreational sector within its allocation, taking account of the intent to maintain open access for all recreational fishers and the specific circumstances in each fishery.
• Develop a mechanism to improve information collection and communication across all recreational fishers.

Charter fishing sector

An important component of the Recreational Fishery is the charter sector. These businesses provide a platform and a service to their customers, who are recreational fishers. This sector is believed to have grown in recent years, especially for marine species such as snapper, calamari and Southern Bluefin Tuna but at the moment, there is limited information on the catch and effort of the charter sector.

Unlike in other Australian jurisdictions, charter operators are not regulated directly under the fisheries legislation in Victoria¹⁰. There are reasons to consider introducing some well-designed regulation of charter fishing because this sector has the potential for a relatively high impact on fish stocks because the expertise and equipment that a charter operator brings to recreational fishers increases their effectiveness and efficiency. The sector can have a particular impact on localised species.

There are two major fisheries management challenges - lack of information about catch and effort of the sector, and the inability to apply "fit and proper person" criteria to operators. However, as stated earlier, the reduction in regulatory burden is a key driver for reform and the introduction of proposed regulation would need to be carefully considered.

Under a resource sharing framework the charter sector will form a component of the recreational share. This framework would provide more security to the recreational and charter sectors and an environment to allow growth. Better recreational catch and effort information will be necessary under a resource sharing framework, including better information on charter catch and effort. The costs of getting this information will be an important part of reviewing the regulation of the fishery.

Recreational bag and, in some cases, boat limits will continue to apply to charter customers irrespective of which regulatory approach was preferred as a result of the review.

Proposal for reform:

• Review Charter Fisheries as a part of the implementation plan for the Future Fisheries Strategy, with a view to meeting information and compliance needs without creating unnecessary regulatory burden.

Aboriginal fishing sector

Traditional Owners are recognised under legislation through the Commonwealth Native Title Act 1993, the Traditional Owners Settlement Act 2010 and the Aboriginal Heritage Act 2006. The fisheries management regime in Victoria does not currently provide specific recognition, or provision for interests of Aboriginal fishers. As outlined in the resource sharing section above, it is intended that specific provision is made for the amount of customary fishing in establishing allocations for a fishery.

The broader recognition for customary fishing, including use of customary practises, role in management and opportunities for involvement in commercial fishing will be negotiated through agreements with Traditional Owners and may be delivered through mechanisms confirmed as the Victorian Aboriginal Fishing Strategy, under development by DPI, is finalised.

To support these other processes and in particular the opportunities for involvement in commercial fishing that may be agreed through these processes, it is proposed that the Developing Fisheries Policy that will be developed for new commercial fisheries provide for allocation of entitlements to native title holders in specified circumstances. For example, where native title holders have a connection to the waters for which the entitlements provide access, priority should be given to the relevant community that holds native title if additional entitlements are going to be auctioned, with an option for allocation prior to auction.

Proposal for reform

• Include options for allocating newly created entitlements to relevant native title holders in the Developing Fisheries Policy.
  

5. Stakeholder engagement and governance arrangements

Aboriginal, commercial and recreational fishers, the conservation sector, other State agencies, Commonwealth agencies, other interstate fisheries regulators and the community are all important stakeholders in fisheries management in Victoria. Decisions need to take into account the diverse interests of these stakeholders.

The focus of this reform area is improving our engagement and the governance arrangements associated with the people and organisations in the commercial, recreational and Aboriginal fishing sectors.

Constructive relationships with stakeholders contribute to fisheries management in a range of ways:

• Information. Stakeholders provide information and experience to fisheries management that is valuable and not otherwise available.
• Equity and conflict. Fisheries management involves diverse and sometimes competing interests and, therefore, requires choices to be made. These choices mean that stakeholders' interests are affected by fisheries management decisions. It is thus important that stakeholders understand and have opportunities to be involved in the process. Decisions are more likely to be sound decisions if they identify and take into account affected interests and the potential impact on those interests. Also, decisions are more likely to be accepted if people understand why a decision has been made.
• Efficiency. Fisheries management services should be delivered as efficiently as possible and engaged stakeholders assist in providing efficient delivery. Disengaged stakeholders can create costs in delivering services. Voluntary compliance with fishing rules is more likely if fishers are informed about the rules and the reasons for those rules. Importantly, continuous, structured and meaningful engagement with stakeholders will build confidence in management processes and industry-driven initiatives, with flow on benefits to delivery and costs.

Section 3A of the Fisheries Act 1995 sets out an extensive list of consultation principles. This list provides that consultation processes need to be designed to suit the circumstances, based on a set of standards that ensure that consultation is:

• clear, open, timely and transparent;
• proportional to the impact of the decision and to the number of people involved;
• adequately resourced;
• designed to account for the capacity of stakeholders to contribute to the process; and
• inclusive of representative views and values of stakeholder groups and expert advice.

These principles establish minimum standards for statutory consultation. However, stakeholder engagement in fisheries management also, ideally, provides opportunities for stakeholders to take on greater roles within fisheries management where that would produce better decisions and/or reduce costs. This requires a focus on the governance of stakeholder organisations and the framework within which they may be able to take on responsibilities and be accountable for them.

There are a range of models for stakeholder involvement in fisheries management, ranging from a centralised government model where government takes on most management functions, to a model with a high degree of delegation to stakeholder organisations, with various models in between. See diagram below.¹¹

Figure 1. Levels of parties' engagement in decision-making under the four types of fisheries management model

The figure shows the four types of fisheries management models ranging from the centralised model on the left (high on "command and control" by the government agency) to the delegated model (high on significant management delegation to fishers) on the right.

It is proposed that a framework be developed setting out the standards and pre-conditions to guide stakeholder organisations in moving from one level of responsibility to another. Different standards and pre-conditions apply to different levels of responsibility. Examples include the existence of a management plan for the fishery with an agreed harvest strategy; governance standards being met by stakeholder organisations to demonstrate that they are representative, professional and financially viable; detailed documentation of the services to be provided; rigorous assessment of the costs and benefits of alternative arrangements and specification of performance standards.

There is a role for government in not only setting up the framework for devolved governance, but also supporting groups to improve their governance to meet the standards and pre-conditions. The initial phases of this process are resource-intensive and require the development of governance capability within stakeholder organisations. The government can also assist by identifying appropriate governance mechanisms.

In addition to the framework for fishery-specific organisations to take on greater responsibilities, there is also an important role for representative sector bodies and other over-arching stakeholder forums. A Stakeholder Engagement and Governance Policy needs to include the governance standards that representative bodies need to meet to receive funds collected by government. The funds are currently collected by government through commercial and recreational licences fees and granted to Seafood Industry Victoria (SIV) and VRFish, respectively.

As fishery governance arrangements move from centralised to de-centralised models, non-government organisations can potentially take on a particular role in some aspects of fisheries management such as the development of a harvest strategy to provide a level of accountability against sustainability standards.

Proposal for reform

• Develop a Stakeholder Engagement and Governance Policy setting out the framework for devolving selected management functions to stakeholder organisations, including the pre-conditions, standards and accountability associated with different levels of devolved governance.
• Include in the Policy strategies for supporting and developing strong and engaged stakeholder organisations, including arrangements that support collective decision-making by those organisations and the development of leadership capability within organisations.
• Include in the Policy processes for consultation on key management functions such as management planning.
• Include in the Policy accountability arrangements for representative sector bodies.
• Establish a cross-sectoral Fisheries Advisory Forum to provide advice to the Minister or DPI delegates.

While a Stakeholder Engagement and Governance Policy would cover a range of issues and processes, a particular process that is fundamental to good fisheries management is the setting of annual catch or effort limits in accordance with the harvest strategy for a fishery. Sound harvest strategies will provide guidance about the decisions to be made, either by prescribing the response or the range of responses appropriate to the circumstances. Involvement of fishers in the process of developing harvest strategies is vitally important and this will be reflected in the work on management planning and harvest strategies proposed in this paper.

However, there are often decisions to be made and given the different competing interests involved, a level of regulatory independence in the process is appropriate. In New South Wales, an independent body sets annual total allowable catch limits in accordance with harvest strategies. This body is independent of the Minister and the Department. In other jurisdictions, limits are set by the Minister or Departmental delegate but have independent advice incorporated into the process (eg. through an advisory council or through processes chaired by independent experts).

Proposal for reform

• Establish an independent process to set catch limits as required by harvest strategies.

6. Management planning processes

Management planning is the core mechanism to deliver fisheries management objectives. It integrates the different functions within the fisheries management process, and focuses effort around achieving agreed objectives for a fishery.

The functions within fisheries management can be described as:

• Scientific information is collected, generated and analysed to inform decision-making.
• Decisions are made (fisheries management) according to policy.
• Decisions are implemented (primarily through legislation and licensing).
• Compliance programs are run to maximise compliance with the rules created. Compliance includes a range of preventative and enforcement strategies, including education programs.

Information and science

Decision-making

Implementation

Compliance

Management planning seeks to ensure that all of these functions are run efficiently, are integrated and are co-ordinated to meet clear objectives and to be consistent with the harvest strategy policy. This requires the development of management plans for particular fisheries to define the objectives and strategies for achieving those objectives, and also requires ongoing processes to plan and complete activities within this framework. Having the right people involved at the appropriate steps along the way is an important component of good management planning. This includes the regulator and stakeholders.

The current fisheries management planning processes in Victoria need to be improved and documented. The fishery reviews proposed in the implementation phase of the Future Fisheries Strategy will be guided by a stronger fishery management planning framework. This will provide the opportunity to:

• review the performance of the fishery and its management arrangements against defined criteria;
• consider whether the management regime in place for the fishery includes the optimum mix of tools to be applied such that the specification of size limits, seasonal and area closures or other fishing controls are designed to meet the fishery objectives;
• rationalise rules to meet the fishery specific objectives using a defined set of principles and a "toolbox" of options - for example, establish a consistent approach for the application of size limits;
• prescribe the services needed to support the objectives and management strategy for the fishery;
• develop and implement a management plan for the fishery;
• periodically evaluate the performance of the fishery and the management arrangements; and
• Ensure that DPI's processes support inclusive processes and evidence-based decision-making in alignment with the management plans.

Proposal for reform

• Prepare a guide for the development, implementation and evaluation of fishery management plans.
• Improve DPI¡¦s planning and decision-making processes for fisheries to ensure that they are efficient, evidence-based, inclusive and able to deliver the Future Fisheries Strategy reforms.

Further to the above, the research and development planning relationship within the management planning process requires that research is planned to meet the management objectives and strategies of the fishery, and vice versa, that management objectives and strategies are developed in a way that incorporates scientific knowledge and methodology. The information strategy will also provide some certainty about the information collection and analysis programs needed.

In managing the science function within fisheries management, there are institutional issues to take into account, including the national Fisheries and Aquaculture Research, Development and Extension strategy that has been agreed by the Primary Industries Ministerial Council, and which seeks to consolidate fisheries research functions across Australia. A science strategy is currently being developed to respond to these challenges.

Proposal for reform

• Develop a clear fisheries science strategy as part of the Future Fisheries Strategy and implementation plan.

7. Fisheries compliance

The management planning process requires that compliance activities are planned to meet the management objectives and strategies of the fishery, and vice versa, that management objectives and strategies are developed in a way that incorporates their knowledge and expertise of compliance staff and stakeholders.

The compliance function within fisheries management planning presents unique challenges, including the management of a diverse range of issues and fishers with limited resources. It is also difficult to measure the performance on compliance activities over time and to report on effectiveness in a meaningful way. DPI has adopted an "intelligence-led" and risk-based approach to planning and implementing compliance activities that incorporate both preventative strategies (eg. education and engagement) and enforcement strategies (infringement notices to prosecution). Specific challenges within this framework include:

• applying the appropriate mix of preventative and enforcement tools to compliance risks;
• developing a range of preventative strategies, including education activities;
• designing and implementing penalties and enforcement mechanisms to reinforce good fishing practices and maximise deterrence;
• identifying performance indicators;
• incorporating fisher knowledge and information in planning without compromising compliance methods;
• ensuring that compliance activities are specifically linked to management objectives across a range of fisheries; and
• establishing guiding principles for the design of integrated compliance activities to underpin any management changes following the review of each fishery.

Proposal for reform

• Develop an integrated Fisheries Compliance Strategy to address the issues above and incorporate relevant components into management planning processes.

8. Knowledge and information

Consideration of the other reform areas highlights the need for an information strategy to support evidence-based decision-making in fisheries management. For example, the proposed resource sharing framework is underpinned by an estimation of catch and effort of each fishing sector. This information is currently poor for the recreational sector. The harvest strategies for each fishery will explicitly outline the information needs of the strategy. Comprehensive management planning will outline the biological, economic and social objectives for a fishery and strategies for achieving those objectives, including collection of information to support decision-making.

Examples of the information needs that the Future Fisheries Strategy and its associated Strategic Policies are likely to highlight include:

• Information on fishing behaviour and fishing preferences to underpin compliance planning, including for Culturally and Linguistically Diverse (CALD) communities;
• Economic information about the value of the various sectors and economic information about the seafood industry;
• Information to support social objectives and strategies as defined in management plans¹²;
• Incorporating compliance information into stock assessment processes; and
• Information about post-harvest activities and market characteristics.

This is in addition to the biological and ecological information about a fishery.

Information is fundamental to the delivery of fisheries management services and a strategy is important to guide the programs and processes that need to be in place to collect them. Funding for core information services can then be identified, and distinguished from optional services. A risk-based approach underpins this process, with higher-value and/or higher risk fisheries needing more detailed information than smaller fisheries with low risk profiles.

The best available information from a range of sources should be used depending on the circumstances and the risk profile of the fishery. For example, the input of local expertise will be appropriate in some circumstances. An information strategy will provide some guidance about applying these principles.

Proposal for reform

• Expand DPI's Information Strategy to document the core information required to support fisheries management in Victoria and the resources required to implement the program, with an emphasis on integrating the biological, ecological, economic, social and behavioural information needed to manage and assess fisheries.
• Prepare a cost/benefit analysis of methods to better collect recreational catch data.
• Map out how to move to online reporting.

Performance measurement

Information is also fundamental to assessing the overall performance of fisheries management. The reforms proposed for the Future Fisheries Strategy seek to set up the architecture to improve our overall performance against new objectives over time, as fisheries are reviewed.

The need to think about the future and the challenges facing the fishing sector is an ongoing process. Over time, adjustment will be needed as objectives are met, and results from monitoring performance are taken into account. The sector needs to be able to measure, and report on, activities and results from each of the objectives, to gain a common understanding of progress towards the agreed outcomes, and to adjust the objectives or actions in light of experience. The community needs to have confidence that fisheries are well-managed. Reporting on performance provides the public with the information to make this assessment.

An effective monitoring regime needs to be able to assess fisheries performance over long periods of time in a consistent, clear and cost-effective way. Fishery managers, including government and stakeholders, need to be sure of its integrity and practicality. In addition to fishery performance, overall performance against economic, social and cultural values needs to be undertaken, taking into account community expectations. An understanding of community expectations needs to be become a part of the information collected to this effectively.

Performance indicators, the means of collecting the information and the reporting of results all need to be thought through, and integrated into the seven areas of reform. The Fishery Status Report is currently published every two years, which reports on some elements of fishery performance. This will be revised to include overall performance measurement reporting.

Proposals for reform

• As part of the Future Fisheries Strategy identify performance indicators to measure performance against the specified objectives.
• Include in the information strategy the data that need to be collected, and how they will be collected, to report against the performance indicators.
• Establish an ongoing process for reporting on performance and revamping the Status Report to include all aspects of performance measurement.

9. Contributions to the costs of fisheries science, management and compliance

The Victorian Department of Treasury and Finance (DTF) has published guidelines on implementing cost recovery. In the past, it was common for many government activities to be largely funded from general taxation revenue¹³. More recently, governments have been recovering some or all of the costs of various activities by more direct means.

The DTF Guidelines are reflected in one of the draft fisheries management principles on page 17, that "users of fisheries resources should pay for the cost of efficient services from which they benefit and services which address risks created by their activities."The rationale behind this principle is that it is reasonable to recover management costs of efficiently provided services and management from those who benefit from use, or cause the risk that needs to be managed. The extent of recovery should consider the public benefits of fisheries services.

The objectives of cost recovery are to provide equity and efficiency. Equity is addressed by having those who use or create the need for the service pay for it, rather than the wider community. Cost recovery also promotes efficiency in the provision of services by government agencies.

The benefits of cost recovery in fisheries management potentially include:

• constructive engagement with the sector about the services required to deliver fisheries management services that meet fishery objectives. This raises awareness about the extent of fisheries management services, and brings discipline to demands for increased services;
• it drives the need for better work planning and promotes public scrutiny of service provision. For example, it requires definition of core government services and, with transparency, brings higher standards of planning, budgeting and reporting. Service providers (including government) need to meet explicit performance indicators for service delivery; and
• there is increased potential for innovation and efficiency in design of services.

There is currently a cost recovery system in place for commercial fisheries and aquaculture in Victoria, which recovers some of the costs of management. A Fisheries Cost Recovery Standing Committee, mostly involving industry and some DPI members, provides advice on the current cost recovery system.

A review of fisheries cost recovery has identified that the existing system is complex and applied inconsistently across fisheries, is expensive to run, recovers costs on a retrospective basis (which dilutes the positive incentives available from cost recovery) and lacks transparency with limited opportunity for sector input.

A better system would meet the following criteria:

• Prospective - forward planning and budgeting for service provision.
• Simplicity.
• Transparency - about nature and extent and cost of particular services.
• Equity amongst stakeholders relative to benefits derived (avoids cross subsidisation).
• Provide opportunity for fishers to support, through collective decisions, levels of service above a baseline set by government.

In principle, the same issues could be considered for the recreational sector, even though they may apply quite differently. However, limited work has been undertaken in Australia and internationally with regard to recovering the costs of delivering science, management and compliance programs to support the operation of recreational fisheries. Key questions that should to be considered include:

• Defining the level of public benefits derived from government funding for recreational fishing programs, particularly given the large number of people who go recreational fishing and the social benefits that it provides in terms of healthy communities and regional tourism; and
• Applying arrangements that apply equitably to the commercial and recreational sectors, particularly within the context of establishing resource sharing arrangements and a fair way to adjust shares over time.

The recreational sector currently makes a substantial, albeit partial, contribution to the overall costs of managing recreational fisheries through the allocation of recreational fishing licence revenue. The current funding contribution is mainly directed towards boosting fisheries compliance on an ongoing basis and scientific studies on a needs basis, as well as a broad range of other actions to improvement opportunities for recreational fishing across Victoria (eg stocking native and salmonid fish and improving access to popular fishing spots). However, current funding arrangements do not enable thorough and ongoing estimation of recreational catches or assessment of fish stocks for popular recreational fisheries such as snapper, King George whiting or black bream.

Proposal for reform

• Complete the review of cost recovery policy to establish the principles and processes for cost recovery in Victorian commercial fisheries (and aquaculture).
• Work closely with the recreational fishing sector to review the contribution made by the recreational fishing sector towards the delivery of science, management and compliance programs that provide direct benefits for recreational fishers.

10. Resource rents

Fisheries are managed by government for the benefit of the whole community. Benefits accrue to fishers through their direct access to catch fish or to consumers through their ability to buy local seafood. Benefits to the community generally (and not just those that fish) can also accrue through the collection of resource rent from commercial fishers in return for their exclusive opportunity to harvest and sell a public resource.

Resource rents also can provide a price signal to encourage the most efficient users of the resource to participate in the fishery and a signal for the least efficient to exit the industry. Where assets are created (e.g. quota units) the collection of resource rent lowers the capitalised price of those assets, which enables "new entrants" a better chance to access a fishery.

The best time to collect resource rents is when access entitlements to a particular fishery are allocated for the first time. The most appropriate methods for collecting rents are auctions, tenders or similar methods that require participants to reveal their willingness to pay for their access to the resource.

Alternative approaches that purport to calculate rents after entitlements have been issued are generally imprecise, costly to administer, potentially distorting and create significant transitional issues for established businesses. Any decision about the potential collection of resource rents in an existing fishery should consider the existence of rents and the costs of collecting them. This creates an interaction with other reforms, particularly cost recovery, which should be addressed first.

An arrangement is in place to collect a combined royalty and management fee for the Victorian commercial abalone fishery, which is capped at 7.2 percent of the fishery's annual Gross Value of Production. Resource rents are not collected for any other Victorian fisheries at present.

It is proposed that resource rents should not be collected from existing Victorian commercial fisheries for the foreseeable future, given that:

• developing and implementing the range of other reforms under the Future Fisheries Strategy for each fishery is a higher priority;
• it is unclear whether rents exist in our commercial fisheries and to what extent;
• the collection of rents would generate significant transitional issues for existing commercial fishing businesses, given that ongoing access entitlements have been issued and capitalised into their market value; and
• the cost to establish and administer a verifiable process to collect rents is likely to be high.

It is proposed that the collection of the royalty for the abalone fishery be de-activated. In reality, only a limited amount of royalty is collected as the current formula and 7.2% cap on total fees means that no royalty is currently collected from one of the three abalone fisheries and a relatively small amount from the other two zones. Additionally, DPI has identified substantial shortcomings in the current process to verify the calculated Gross Value of Production in the fishery.

It is proposed that resource rents will be collected as part of the process to establish any new commercial fisheries or to allocate additional access entitlements in an existing commercial "permit" fishery. Businesses that held a current permit in an existing permit fishery as at 1 July 2011 will not be required to pay resource rent with respect to their historical catch history.

Proposal for reform

• De-active the collection of the royalty for the abalone fishery.
• Through the Developing Fisheries Policy, provide that access to any new fisheries will be allocated by auction, tender or similar method (subject to recognising current participation in existing permit fisheries as discussed under "Access entitlements").

A way forward

The Future Fisheries Strategy

The first step in moving this reform agenda forward is the finalisation of a Future Fisheries Strategy to provide the direction to the process. It is anticipated that the Strategy will be finalised in 2012.

Amendments to Fisheries Act 1995

Amendments to the Act are likely to be necessary to implement the Future Fisheries Strategy. The Act does not require a complete overhaul but there are some areas that are likely to require amendment. In particular, the objectives set out in section 3 are likely to need to be updated to set the direction for fisheries management in Victoria.

It may also be necessary to amend the Act to include mechanisms for pursuing the objectives. For example, the Act is currently silent on resource sharing and if a resource sharing framework is agreed, it is likely that this will require legislative backing. Other amendments may be necessary to implement other areas of reform.

Strategic policies

The Future Fisheries Strategy will not capture all of the detail in the areas requiring reform. Strategic policies will need to be developed to capture this level of detail. It is proposed that policy documents be developed for the key reform areas discussed below (if they are agreed through this process as representing the most important reform areas). These policies will provide detailed guidance to DPI and fishery stakeholders when participating in fisheries management in the future and, specifically, when reviewing fisheries in accordance with the implementation plan.

It is important that the relevant expertise and stakeholders will be involved in developing these policies in an inclusive and thorough way.

Fishery reviews

A timetable of fishery reviews will be included in the implementation plan for the Future Fisheries Strategy. The reviews will evaluate the performance of the fishery under its current management arrangements, and if improvements are identified, develop revised arrangements in accordance with the direction provided by the Future Fisheries Strategy and the framework established by the amended Act and new strategic policies. The central instrument for focussing these reviews will be the management plan for a fishery and, specifically, developing a new or revised management plan for the fishery.

Two reviews are already underway - a review of the Eastern Zone Rock Lobster Fishery and the Eel Fishery. A process is also in place to consider rationalising the Bass Straight Scallop Fishery, which is currently managed by three jurisdictions (Victoria, Tasmania and the Commonwealth). Any actions from the reviews will be incorporated into the implementation plan for the Future Fisheries Strategy. Again, stakeholder involvement in these processes will be critical to ensure good outcomes.

Glossary of terms

Aboriginal fishing sector Fishing undertaken by Victorian Aboriginal people for the purposes of traditional, cultural, social and commercial purposes.

Allocation Distribution of the opportunity to access fisheries resources, within and between stakeholder groups.

Aquaculture The farming of fish and other marine animals in freshwaters and marine environments.

Biodiversity The variability among living organisms from all sources including diversity within species and between species.

Devolved governance Arrangements between governments and stakeholder groups to transfer responsibility for managing fisheries resources and/or providing services on an agreed basis.

Charter fishing sectorOperators who provide fishing opportunities for recreational fishers, either through boat based or guided fishing activities.

Commercial fishing sectorFishing undertaken for the purposes of trade or business.

Common property/common pool resource A resource that is determined to be owned by the community, or by the State on behalf of the community.

Cost recovery Recovery of the costs of research, management and compliance from the users of the resource who benefit from use of the resource or cause the risk to the resource that needs to be managed.

Fishery production areas Habitats that are crucial to the life cycle of a species, which typically includes nurseries such as estuaries, mangroves, seagrass beds, reefs and defined spawning areas.

Customary fishing Fishing for the purposes of satisfying personal, domestic and communal needs, including ceremonial, spiritual and educational needs and utilising fish and other natural marine and freshwater products according to relevant Aboriginal custom. Also known as traditional fishing.

Data poor fishery A fishery where limited data are available to inform management. For example, fisheries for species where baseline biological data such as size at maturity, fishing mortality and growth rates are unknown.

Decision rulesAgreed management responses to pre-defined circumstances.

Ecologically sustainable development/long term sustainabilityUsing, conserving and enhancing the community¡¦s resources so that ecological processes, on which life depends, are maintained, and the total quality of life, now and in the future, can be increased.

Economic productivity The maximisation of the value of the net benefits derived from use of fishery resources.

Ecosystem A dynamic complex of plant, animal, fungal, and micro-organism communities and the associated non-living environment interacting as an ecological unit.

Harvest strategy Sets out the management actions necessary to achieve defined objectives for a fishery.

Individual transferable quota A management tool by which portions of the total allowable catch are allocated among individual fishers or companies as units of quota. Quota entitlements can be made to be temporarily or permanently transferable between individuals fishers or companies.

Input controls Limitations on the amount of fishing effort to control the amount of fish caught (for example limited entry, gear control, seasonal closures)

Limited entry Fishing effort is controlled by restricting the number of operators. It usually requires controlling the number of licences in a fishery. It can also include restrictions on the number and size of vessels, the transfer of fishing rights, and the replacement of vessels

Output controls Management measures directly limiting fish catch or landings (for example quota).

Overfished A fish stock which has been depleted by overfishing to below desired levels

Performance indicators A measurement used to assess progress against fishery management objectives.

Quota management A management system based on the weight or number of fish that may be caught of a particular stock or from specified waters.

Quota entitlement The proportion of a quota that is held by an entity which limits the total amount of a species that is permitted to be taken in a year.

Reference points Indicators of the status of a fish stock used to measure fishery performance against. Target reference points are the desired status of the stock. Limit reference points establish an undesirable stock status, and represent a point beyond which the risk to the sustainability of the stock is unacceptably high.

Recreational fishing Fishing for a purpose other than trade or business, where the catch is released or used for personal consumption or taken for sport.

Resource rent A rent charged for use of a publically owned resource, to provide some payment for use of the resource to the community.

Stakeholder An individual or a group with an interest in the conservation, management and use of a resource.

Stock A group of individuals of a species occupying a well defined spatial range independent of other groups of the same species, which can be regarded as an entity for management or assessment purposes.

Stock assessment A detailed analysis of stock status (abundance, distribution, age structure, etc.) to support the management of the stock.

Target species The most highly sought component of the catch taken by fishers.

Threatened A species or community that is vulnerable, endangered or presumed extinct.

Total allowable catch (TAC) The total amount of a species that may be taken from an area during a specified time period.

Total allowable commercial catch (TACC) The total amount of species that may be taken by commercial fishing from an area during a specified time period.

Traditional Owners This definition includes, but is not limited to Traditional Owners as declared under Native Title agreements.

Trigger points Events or measures that, if they occur, are used to determine that a response should be made.

 

Attachment 1

View the Feedback form

Attachment 2

View the Draft Objectives And Governance Principles For Fisheries Management In Victoria

Footnotes

1 Details available from the Victorian Competition and Efficiency Commission www.vcec.gov.au

2 Department of Primary Industries, 2010 Fisheries Victoria Commercial Fish Production Information Bulletin Fisheries Victoria, Queenscliff, Victoria, Australia ISSN: 1446-2567

3 Department of Primary Industries, 2010 Fisheries Victoria Commercial Fish Production Information Bulletin Fisheries Victoria, Queenscliff, Victoria, Australia ISSN: 1446-2567

4 Econsearch, 2011, Sensitivity Analysis for Victorian Fisheries and Aquaculture Sectors, Department of Primary Industries Victoria

5 Econsearch, 2011, Sensitivity Analysis for Victorian Fisheries and Aquaculture Sectors, Department of Primary Industries Victoria

6 IPSOS, 2006, Seafood consumption omnibus, Fisheries Research and Development Corporation

7 Blandowski, W. 1857. "Recent discoveries in natural history on the lower Murray." Transactions of the Philosophical Institute of Victoria, 2:124-137, from Humphries, p. 108.

8 Massola, A. 1956 "Australian fish hooks and their distribution" Memoirs of Nat. Mus. Vict. No. 22:1-16. Anthropology Series 1, p. 5

9 See for example results of 2007/08 South Australian Recreational Fishing Survey: Jones, K. (2009) South Australian Recreational Fishing Survey. PIRSA Fisheries, Adelaide, 84 pp. South Australian Fisheries Management Series Paper No 54.

10 All other jurisdictions other than Tasmania have a licensing scheme for charter fishing. The Tasmanian industry operates under a code of conduct.

11 Co-management: Managing Australia's fisheries through partnership and delegation (Report of the Fisheries Research and Development Corporation's national working group on the fisheries co-management initiative).

12 A national project is currently underway, funded by the Fisheries Research and Development Corporation, to identify social objectives that may be applicable to fisheries across Australia. The outcomes of this project will be relevant to developing our information strategy.

13 http://www.dtf.vic.gov.au/CA25713E0002EF43/pages/publications-regulation-guidelines