Mr. Cathal Groonell:

Táimid an-bhuíoch as ucht an cuireadh seo teacht os comhair an choiste chun fadhbanna na monarchana próiseála in iarthar agus deisceart na tíre a phlé.

We appreciate the opportunity to address the joint committee on the difficulties experienced by fish processing factories on the south and west coast in obtaining access to a fair share of the national mackerel quota. We are concerned that a blind eye is being turned to the employment implications of recent developments which will be devastating, given the nature of the coastal communities in which the factories are located. The mackerel quota is the State's most valuable quota.

There are 12 registered pelagic processing factories in the country - eight in County Donegal and one each in Rossaveal, Baltimore, Dingle and Castletownbere. These factories mainly process mackerel, herring, horse mackerel, sprat and blue whiting.

There are 50 boats in the fleet with a pelagic quota entitlement. There are 23 in the refrigerated sea water, RSW, sector which are currently allocated 87% of the mackerel quota. A total of 21 of the 23 are Killybegs based. There are 27 boats in the polyvalent fleet, based mainly on the south coast. They are allocated the remaining 13% of the mackerel quota.

The difficulty with supply for some factories arises because of a major difference between the Department of Agriculture, Food and the Marine’s stated policy on quota allocation and the policy actually practised on the ground. The Department's policy document, Fisheries Quota Management in Ireland, April 2016, statest:

In Ireland quota is a public resource and is managed to ensure property rights are not granted to individual operators. This is seen as a critical policy in order to ensure that quotas are not concentrated into the hands of large fishing companies whose owners have the financial resources to buy up such rights. In Ireland, any movement towards privatization and concentration of rights into the hands of large companies would seriously risk fishing vessels losing an economic link with Ireland’s coastal communities and undermining the socio economic importance of the fishing industry in coastal communities dependent on fishing.

This is the stated policy, but it is not happening on the ground. Large Killybegs based companies which already control much of the quota are actively encouraging fishermen whose boats have licences with a pelagic quota entitlement to sell their boats, offering prices well in excess of their economic value. This trend has serious implications for fishing ports in the south and west. In Rossaveal three boats have been sold to Killybegs based companies in the past year. These boats were the main suppliers to Iasc Mara Teoranta for decades and accounted for over 60% of the fish supply to the factory. The reported prices paid for the boats were €5 million, €6 million and €8 million. Of these prices about 20% relates to the actual cost of the boats and 80% to the licences and the pelagic quota entitlements. All of the fish from them is now processed in Killybegs or outside the country. This has put the future of Iasc Mara Teoranta in jeopardy. It is also a major blow to the local fisherman’s co-op that handled their fish and all of the service providers and small businesses in the Rossaveal area. In total, five Rossaveal based boats have been bought by companies in Killybegs in recent years. There are now no active pelagic boats based in Rossaveal.

The Department’s stated policy had absolutely no effect in preventing these purchases of quotas and vessels. In effect, the Department is refusing to police its own policy. This trend is continuing and other factories are concerned that, in time, their suppliers will also be bought up. Four companies in Killybegs handle over 80% of the pelagic quota through boats that they own or boats that they control and which land exclusively for them. Unless the Department takes immediate action to change the way the mackerel quota is allocated and take vessels and factories into account, the number of pelagic factories in the country will reduce from 12 to five or six in the short term.

This will result in a loss of 300 to 400 jobs around the coast and would leave many ports with little or no fishing activity as all of the activity will be concentrated in one port.

For many years we have regularly raised the issue of supply difficulties with the Department officials and with the then Minister. More recently we wrote to the Minister for Agriculture, Food and the Marine, Deputy Creed in November 2016 with a proposal to secure the supply of mackerel for the 12 factories and to save the jobs in fish processing and related services around the coast. I will come to the detail of the proposal shortly. In January 2017, the Minister, Deputy Creed announced a Consultation Paper on a Review of Mackerel Allocation Policy between the Fleet Segments. The letter announcing the consultation process made reference to a request made by the Irish South and West Fish Producers Organisation Ltd, but, made no reference to our proposal. After considering the submissions received, the Minister will decide whether to change the percentage allocation between the polyvalent and the RSW fleet. This consultation process applies to the 10,600 tonne increase in the 2017 mackerel quota only and does not address access by processors to the resource in different regions.

At present, the national mackerel quota for 2017 is 86,426 tonnes. This is allocated 87% or 75,190 tonnes to the vessels in the RSW sector and 13% or 11,235 tonnes to the vessels in the polyvalent sector. However, this may change when the Minister has completed his review.

To put these figures in perspective, the four factories in the south processed a total of 3,000 tonnes out of a total quota of 76,000 tonnes in 2016. This amounts to 4%, an average of 1% per factory of the total mackerel quota. Factories cannot survive on these volumes and these four factories, employing more than 240 people directly and indirectly are particularly at risk.

Our proposal is that in view of the urgency of the crisis confronting the smaller processors, it is proposed that on a pilot basis 12,000 tonnes, or approximately 14% of the quota, should be allocated to processors in 2018 - 1,000 tonnes to each of the 12 registered pelagic factories in the State. The remaining quota would then be allocated to the RSW sector and to the polyvalent sector.

It is envisaged that the factories will then allocate this quota on a tonne for tonne basis to the boats and pay the market price for the fish. In this way, each factory would receive a minimum of 2,000 tonnes of mackerel per annum. Of the 12,000 tonnes, 8,000 tonnes would be allocated to factories in Donegal. It is envisaged that the quota allocated to the smaller factories will be applied to the polyvalent fleet. This proposal is a step towards aligning the current practice on the ground with the Department’s stated policy. This proposal will also provide an incentive for boats to land their quota in the State, increase employment and value added in the State and promote a more even distribution of activity by region.

We realise that this represents a change from the traditional way the quota has been allocated. If the Department comes up with an alternative proposal that ensures a fair distribution of fish to all factories, we are willing to listen. The present regime ensures that we do not have access to purchase 90% of the fish.

It is very important to note that factory employees, fish processors, service providers, crewmen, fishermen and local communities are all stakeholders in this industry and all deserve to be considered when the quota is being allocated. This issue is not new to the Department and has been flagged long before the present Minister, Deputy Creed, was appointed.

I am asking the Chairman and committee members to take this matter up with the Minister and his officials in the Department to find a way to implement our proposal or, an acceptable alternative. Our proposal will not cost the State any money, but will ensure the continuation of employment in coastal communities and help to keep these communities alive.

Go raibh maith agaibh.