Smallscale Fisheries Policy & Fishing Rights Allocation Process (FRAP) 2020: DAFF update with Minister and Deputy Minister

Meeting report

Mr Abongile Ngqongwa, Deputy Director: Small-scale Fisheries (SSF), Department of Agriculture, Forestry and Fisheries (DAFF) started by explaining the SSF process flow:

Firstly, the Department had to make sure that there is a legal framework for the implementation of the small-scale fisheries Policy. Before its approval in 2012, there was no legal framework for small-scale fisheries as the Marine Living Resources Act (MLRA) only recognised three sectors; namely: commercial, recreational and subsistence sector.

The document gives an overview of the implementation process from when the Policy was approved in 2012 up until today and it also projects what needs to be done moving forward (see document).

Secondly, he explained the status of the implementation process per province on the following

Milestone Activities as stated in the process flow:

• Legal Framework (Amended Act promulgated and SSF Regs approved)
• Closing of Expression of Interest Process for communities
• Registration and Verification of fishers per community
• Announcement of provisional lists of successful fishers
• Appeals closed
• Tip-off  info followed-up
• Appeals assessment
• SSF Fee Structure &
• Duration of Fishing rights
• Approval of final list of fishers
• Announcement of final list of successful fishers
• Co-op Training
• Co-op Registration
• SSF Rights Allocation process
• Conclude rights appeals
• Facilitation of Support Programmes

(See document to see progress in each province)

In the Northern Cape, after registration and verification, an announcement of provisional lists of successful fishers was completed in August 2016. Those who were provisionally unsuccessful were given an opportunity to appeal, and appeals closed in September 2016. DAFF assessed and finalised appeals in June 2017. The Minister signed off on the final list of successful fishers in November 2017. The final list of small-scale fishers was announced to communities in November 2017 with a total of 103 recognised small-scale fishers. Training of fishers and registration of co-ops was completed in February 2018. The SSF sector was launched in the Northern Cape on 28 September 2018, and the Minister handed over 15 year fishing rights to the tow SSF co-operatives.

In the Western Cape, after registration and verification, an announcement of provisional lists of successful fishers was completed in October 2016. Those who were provisionally unsuccessful were given an opportunity to appeal, and appeals closed in December 2016. DAFF assessed and finalised appeals in April 2018. DAFF received tip-off information from 15 communities and those were investigated and finalised in May 2018. Those who were affected by tip-off were removed from provisional lists and given an opportunity to appeal. DAFF announced the final list of small-scale fishers (excluding the nine in the Western Cape) from 22 to 26 October 2018. Training and registration of co-ops will follow after the 2018/19 West Coast Rock Lobster (WCRL) season.

In the Eastern Cape, after registration and verification, an announcement of provisional lists of successful fishers was completed in November 2016. Applicants that were provisionally unsuccessful were given an opportunity to appeal. Appeals closed in April 2017. DAFF assessed and finalised appeals in November 2017. The Minister signed off on the final list of successful fishers in January 2018 and was announced to communities in February 2018 with a total of 5335 recognised small-scale fishers. Training of fishers and registration of co-ops was concluded on 15 June 2018. 72 co-operatives have been registered to date and rights application processes commenced on 29 October 2018.

In KwaZulu-Natal, after registration and verification, an announcement of provisional lists of successful fishers was completed in July 2017. Applicants who were provisionally unsuccessful were given an opportunity to submit an appeal. Appeals closed in August 2017. DAFF assessed and finalised appeals in November 2017. The Minister signed off on the final list in January 2018. The final list of successful fishers was announced to communities in February 2018 with a total of 2184 recognised small-scale fishers. Training of fishers and registration of co-ops was completed in April 2018. The Department is waiting for lodgement and receipting of co-op registration documents before a rights application process can commence.
 

Important milestones include:

• Approval of the 15 year fishing right duration for the sector;
• The Minister’s exemption of small-scale fishing co-operatives from paying fees or levies for the sector for the next three fishing seasons;
• DAFF has identified and set aside certain species, allocation and concession areas specifically for the small-scale fishing sector;
• DAFF has been engaging with various government departments in all spheres for the purpose of facilitating support programs for the new sector; and
• DAFF will conduct a co-op needs assessment analysis in order to facilitate implementation of support programmes to specific small-scale fishing co-operatives.

Discussion

Mr P Van Dalen (DA) asked about the social economic study that was conducted. He asked if a cost benefit analysis was done in addition to that, to see what the minimum quota for a person and that of a co-operative is to be able to sustain itself.

Mr Van Dalen said that if an analysis has been done, when would a report be presented to the Committee. A lot of promises have been made by the Department and the previous Minister on the quotas that are going to be allocated and the life that would derive from that, however, where would the fish come from since there is not enough fish for everyone.

Mr Van Dalen asked if the Department has an idea of how to accommodate all the fishermen, and if there are plans in place to assist them. He thanked the Minister for listening to the plight of the small-scale fishermen as they have been left unassisted for long time.

Mr A Madella (ANC) first asked the Department to identify the nine communities that were mentioned. Second, he said the Committee has not been appraised on the baseline socio-economic study and asked if it could be made available to the Committee. He asked the Department what the support package entails. It is important that the Department takes cognisance of the fact that support will be required in relation to infrastructure, investment, skills development training etc. He asked what is the total package put together, its budgetary value, and when it will be rolled out.

Mr Madella said that he is in a constituency with five or six fishing communities, and has realised that it is not an easy task to service those communities, but he would be happy to hear that more fishing communities have been identified because they are in extreme poverty and unhappiness. There is a criterion that has been officially developed but it has become apparent that an additional criteria item is being used against some fishermen, and that is their age. When fishermen reach 65 their rights are taken away. It is a concern because of how much those people have invested. He asked the Minister to relook at the age cut off as it has negative impacts.

Mr Madella said there is also discrimination shown to those who have not been able to use all their allocated funds. However, big scale fishers are not treated the same way. If they have underspent, they continue to operate. It is apparent that if fishers want to be successful they need to travel to Cape Town. Service delivery must be improved in a sense that services must be closer to the communities, they should not have to come all the way to Cape Town to be attended to.

Mr N Capa (ANC) asked if there is a possibility that the bi-laws will not be adopted or will take long to get adopted. That is useful information. The report is about the implementation of the Policy, but all other useful information will contribute to job creation and cooperation.
  
Mr W Maphanga (ANC) said the youth in the small-scale fishing communities are not properly considered and the Department promised them bursaries for marine related studies. He asked how many youth have been allocated bursaries.

The Chairperson said everyone must acknowledge that since 2012 the small-scale fisheries have been waiting, and the progress since then should be acknowledged, but the progress should make communities celebrate because sustainability is achieved. She commented on the sustainability in terms of the support structure and availability of resources to support. Allocated rights are not enough if they do not have the support to process and enter the market.

The Chairperson said that co-operatives have the market but who is going to process the fish for them, and how will they benefit out this process? In the Western Cape, although it is good not to rush processes, the process is very slow and it will cause instability in Western Cape. The whole point of all the effort is job creation and development, so what will the outcome be in the end she asked.

Responses

The Minister of Agriculture, Forestry and Fisheries, Mr Senzeni Zokwana shared the same sentiment that there is a need for a push in the Western Cape for allocations. The programme needs to be fast-tracked and quantified. The Department needs to present thoroughly on the kind of support that would be provided. He said the price of the fish becomes so cheap because they do not have good infrastructure to process the fish. If support is given, it will even create jobs in processing of the fish, and also ice will be needed to store the fish.
 
The Deputy Minister of Agriculture, Forestry and Fisheries, Mr Sfiso Buthelezi said the important thing is to present the baseline study to see what informed the project. He also answered the question of the post-allocation support that the Department will give to the small-scale fisheries. It is also important that members should be appraised of that and that the support must be evaluated to see what is working and what is not working, and the Department will come back to present that.   

Mr Motseki Hlatshwayo, Acting Deputy Director-General (DDG): Fisheries, DAFF, said the Department has a bursary scheme in place to support youth in different areas of study. In the branch of fisheries, undergraduate and postgraduate students are supported in studies of aquaculture, oceanography, and fishery science and fishery economics. There is even support for overseas studies as well as internship programmes. In the Branch of Fisheries, there are more than 30 youths that are housed annually for the internship programme.

Ms Siphokazi Ndudane, DDG: Fisheries Management, DAFF dealt with the issue of linkages to the market. The reality is that of the four coastal provinces is that Western Cape and Northern Cape are more advantaged than Eastern Cape and Kwa-Zulu Natal. It is because traditional fishers have been in the Western Cape and the Eastern Cape and has better facilities, hence why there are harbours in the Western Cape. Northern Cape also used to have companies in the fishing industry, but because much of the fish has moved further down south and also due to mining, some factories closed in the Northern Cape. A study was done in 2014 for analysis of infrastructure needed for fishing that would enable the fishers to clean the fish, chill it and generally prepare it to be in a good condition for selling. The study confirmed that Northern Cape and Western Cape are better off than the Eastern Cape and Kwa-Zulu Natal.

The reality is that if a fish is not caught and prepared in a proper manner, it cannot sell for a high price. At times the fishermen catch fish by grabbing it with their hands and if it is shell fish, the shell will break and that decreases its value. One of the things that were done is that the Department found a partner called the International Pole and Line Foundation. Ms Ndudane pleaded with the Committee to go read up on the foundation as it has been given a negative name for some reason. The Foundation has an interest to assist small-scale fisheries in South Africa with equipment.

The Department also partnered with some universities to get honours and masters students to evaluate and monitor the efficiency of the equipment donated by the Foundation. A partnership was also discussed with Woolworths and it agreed to buy their fish from small scale fisheries as long it is in good shape. On the issue of lack of enough fish for all fishermen, unfortunately it is a natural resource and it is limited. That is why people must have alternative livelihoods and take part in activities such as net-repairing, aqua-culture and so forth. The Department is also looking into expanding the livelihoods of people not to only include fishing.

Mr Abongile Ngqongwa, Deputy Director, Small-scale Fisheries, DAFF said the purpose of the socio-economic baseline study was to have a profile of what the communities in question look like socially and economically, and it gave the Department more insight on how it should approach the communities. One typical statistic taken out of the study indicated that 50% of the income in those communities come directly from fishing. In addition, it showed that the majority of the fishing communities are within the poverty line which is R1558. That means that in one month each fisherman/woman takes home about R750, and 46% of their monthly income comes from government grants.

Mr Ngqongwa said the average age of a fisherman is 45 years, which means in essence that 46% of government grant income comes from child support grant which is then used for what it is not supposed to be used for. The task for the Department then is to increase the 50% income from fishing in order for the other balance to go down. The way to achieve that is to give better access to the co-operatives and more importantly to add value to what they can access.

The Department has been engaging with partners who are assisting with work programmes. One of them is an organisation called Abalobi which has developed an application system whereby fisheries can sell directly to restaurants. This system has been taking place for the past three years, specifically in Lombard’s Bay and one other fishing community. They are selling a species that is low valued and the price has tripled just because of being able to directly access the market without going through a middle man. The top three restaurants in the Western Cape also buy directly from those communities. The most important thing in the value chain of small-scale fisheries is being able to tell the story behind the fish they are selling, but they cannot do that due to lack of infrastructure hence the Department has tapped into the municipalities. Once municipalities include small-scale fisheries into their IDP there will be resources attached to those. Many municipalities have agreed to offer support to the small-scale fisheries. The Department has also engaged with the World Bank and National Skills Fund (NSF). DAFF has been granted funding from NSF and that funding goes straight to small-scale fisheries to further capacitate them.

Mr Ngqongwa said some of the fishing communities that have been identified are Saldana bay, Doring bay, Lambert’s bay, Aniston, Austin, Atlantis, Ocean View and Strand. The Companies and Intellectual Property Commission (CIPC) have their own specific requirements before they go register co-operatives, and it is a tedious process looking at the way the co-ops are structured. There are a number of forms that they need to fill in and they need to appoint auditors and do all sorts of things. If you have an auditor, you have to apply to be exempted from being audited as a cooperative. The Department had to make sure that the communities comply with that requirement. Unfortunately in some communities, it was found that out of 50 co-operative documents that are submitted, only 20 go through, which creates a huge delay. The Department has developed a relationship with CIPC and negotiated that if some requirements are not met, some exceptions should be made and they have indeed accommodated some co-operatives and registered them.

On by-laws, Mr Ngqongwa said that as soon as the co-operatives are registered they need to finalise their constitution. As part of the constitution, there are certain by-laws the Department has included that the co-operatives need to fulfill and sign off on. The reason why the by-laws have been included is because they come from small-scale fisheries policies but could not be included in the Act due to the way legislation is written and the policy itself is broader than the mandate that the Department has. It is up to the co-operative to finalise the requirements of the by-laws. For some co-operatives it takes longer to finalise. Without by-laws, rights cannot be processed.

On access to resources, Mr Ngqongwa said that fortunately the Northern Cape gives a good example to other provinces; hake and line fish have been directed to small-scale fisheries specifically. There are certain species set aside for the co-operatives, but the most important thing is to make sure support programmes take care.

The Department’s biggest challenge is that the Directorate responsible for small-scale fisheries only has seven permanent staff members and they are stretched; but they do acknowledge progress must be made faster which calls for innovation and resources from outside of the Department.

Follow-up questions

The Chairperson commented that the policy framework and the bankable business plan are two very important things and they will even help others who may come after the current directorate to continue the work.

Mr Madella asked a question on human resources. He said that seven permanent staff is a problem, and certainly they cannot continue to be under resourced. The area must be improved. That is the reason accusations against staff members are so high because the members cannot get to hear everyone’s queries in time. Another concern is the partnerships with international bodies. At times in Memorandum of Understandings (MOUs) the organisation requests that everything harvested can be bought by them and it actually prevents industries from being created because whatever is harvested is already sold and comes back processed. This is at the expense of the country. It should not happen that way.

Mr Van Dalen asked if he could ask questions on the other presentation that had not been presented yet.

The Chairperson requested that the Members allow the delegation to present the document first and then ask questions afterward.
 
Mr Van Dalen asked a follow up question about the quality of the fish that the fisherman catch. He gave an example that in terms of the squid quotas; the fish are frozen at sea, which ensures that they are very good quality and therefore sold at a higher price. He asked if 25% allocation is taken away from them and given to small-scale fishers. He asked if an analysis on how many jobs will be lost and how many will be gained through the allocation has been conducted, and will the fish get a good price similar to the industry rate at the moment.

Mr Van Dalen said that with the last round of quota allocation a lot has not been allocated and a lot was not caught. He asked if there is a way to offer short term assistance in that respect. He also asked if studies have been done to see if there are enough fish species in each province for the co-operatives to catch, and is it sustainable. If there is not enough then it will be problematic.

Responses

Mr Ngqongwa responded that the issue of squid also related to other species as well. The most important thing is to have a cost benefit analysis for each basket, and there has been some work done it. The most important thing is availability of infrastructure, processing and access to the right markets and facilities. The Department wants to focus on that. In South Africa there are only 22 fisheries but there are so many low valued species. They are low valued not because they don’t have potential to be high value species but because they are not receiving enough focus. A typical example is East Coast Rock Lobster (ECRL), mussels and oysters which are delicacies in other countries.

Mr Van Dalen said the tricky thing is that each year the Department has to determine a casual total allowable effort in terms of section 14 of the marine-living resources Act. So what was set aside the previous year in terms of that Act might not be the same in the following year, so it might be difficult in that regard. Once an allocation that was marked for small-scale fisheries is given or shared with another group, there is a risk that when the co-operatives are ready to review the rights they will not be able to access those resources. The Department has to come up with a generic business model of co-operatives. A problem analysis and object analysis has been done on the co-operatives.  The problem analysis showed that majority of co-operatives risked failure due to three reasons; the first one being the difficulty to access high valued species; secondly, the issue of capacity; and lastly, the lack of coercion in communities. An objective analysis was to counter the problems and to allow the Committee to have a better understanding of the Department’s plans around small-scale fisheries around South Africa.

Ms Ndudane spoke on the issue of unutilised core catches that could be used. She said it is a brilliant idea and it could have been done but the “double F” court case presents a legal problem to do that.
Unfortunately she cannot talk much about that issue. Ms Ndudane emphasised that if that was not the case it could have been done. The Minister has taken a decision to appeal the decision, so it is probable that it will be done.

Briefing on FRPA 2020

Ms Sue Middleton, Chief Director: Fisheries Operations Support said due to time constrains she would skip a number of slides. She began with the FRAP 2015/16 appeals process update which she said is running concurrently with preparations for FRAP 2020.

Appeals have been finalised in Large Pelagics, Patagonian Toothfish, Seaweed, Netfish, KZN Beach-Seine, West Coast Rock Lobster (Offshore), West Coast Rock Lobster (Nearshore) and Fish Processing Establishment sectors. The Minister is still re-considering the appeals received from Category B and Category C Appellants in the Hake Inshore Trawl fishing sector in compliance to the Court Order. This process is at an advanced stage and should be finalised by the end of November 2018. The Minister will thereafter consider and evaluate appeals received in the Horse Mackerel fishing sector, to be concluded by the end of November 2018.
She moved on to speak to FRAP 2020. The fisheries that are due for re-allocation in 2020 are 12 in total; 5 of the 12 are also small-scale species. The Department is proposing an upfront apportionment split; at the moment it stands as just a proposal between small scale and commercial (see figures in brackets) thus they will still be subject to an intensive public consultation process. Members of the public and Members of the Portfolio Committee still have time to add their inputs.

(FRAP 2013)

1. KZN Prawn Trawl
2. Demersal Shark
3. Tuna-Pole Line
4. Hake Handline (100% to small-scale)
5. Line Fish (At least a 50/50 split between commercial and small-scale)
6. White Mussels (100%  to small-scale)
7. Oysters (100% to small-scale)
8. Squid (75/25% split between commercial/small-scale)

FRAP (2020)

1. Small Pelagics (Pilchard and Anchovy)
2. Hake Deepsea Trawl
3. Hake Longline
4. South Coast Rock Lobster

She also gave a review of policies for the FRAP 2020 process and fees; allocation of fishing rights.

The Department will be reviewing the following policies:

General Policy on the Transfer of Fishing Rights

The 12 Sector-specific policies (see slide 7)

The Transfer Policy

The Policy on Fish Processing Establishments (FPEs).

In addition, the department will also be reviewing the FRAP application fees; the Grant of Right fees; permitting fees; license fees; harbour fees and levies paid on fish landed.

Lastly she spoke to the main challenges; the biggest one being capacity. Lastly she spoke to the road map and allocation phases which are now at phase four.

She lastly spoke to the FRAP 2020 preparations in terms of:

• Establishment of the Consultative Advisory Forum (“CAF”) and Fisheries Transformation Council (“FTC”)
• Internal Review Process
• Determination of the apportionment split between commercial and small-scale
• Review of Polices and Application Forms
• Finalise the FRAP 2020 Roadmap
• Appointment of the Delegated Authority
• Capacity challenges
• Appointment of FRAP Project Teams
• Creation of Capacity
• Legal Support
• Call for Volunteers
• Appointment of Independent Process Observers

Lastly she presented the challenges faced as follows:

Capacity challenges: 

The main challenge is that the Fisheries Branch does not have a dedicated Rights Allocation Unit that can work full-time on the FRAP Process.

 To overcome these capacity constraints the following measures have been put in place:

Appointment of FRAP Project Teams:

The Delegated Authority has appointed in writing the members of the FRAP Project Teams and well as the FRAP Project Managers.
Creation of Capacity: The Department has appointed FRAP staff on short-term contracts.

Legal Support:

The Department will appoint 3 legal councils via the State Attorney

Call for Volunteers: 

The Department will call for internal volunteers to assist with the intensive stages of the process such as public consultations, distribution and receipting.

Appointment of Independent Process Observers: 
The Department will appoint an outside agency to monitor and observe the FRAP process.

Due to time constraints, the Chairperson asked that the rest of the presentations and questions be held until the next meeting.

The meeting was adjourned.