A solid marine parks compensation package will be good for fish and fishers

Reducing fishing in the Coral Sea could hugely benefit species. It’s up to the government to make sure it benefits fishers too. Sam Ilic

Coral Sea protection is eminently doable - but the question is, will Australia effectively manage the process of creating the largest network of marine protected areas in world?

The creation of the largest marine protected area in the world will be what Minister Tony Burke will be remembered for, just as former Prime Minister Bob Hawke is remembered for halting the Franklin dam and preserving Australia’s tropical rainforests in the Wet Tropics World Heritage Area. The massive Coral Sea marine protected area will generate environmental benefits at low cost. Minimising the socio-economic costs of transferring assets from private use to the public benefit throughout the whole of the planned marine conservation network is, however, a great challenge ahead for the government.

Announcing the creation of the marine sanctuaries, Burke said yesterday that the Coral Sea protected area was the “jewel in the crown”. The Coral Sea proposal in particular will be very well received, given that the level of public support is unprecedented. Almost half a million submissions on the draft plan were received by the Department of Environment. While most of these were email or postcard-type offerings organised by conservation groups, there were over 900 detailed submissions.

Coral sea species could benefit greatly from reserves

The main objective of affording protection through reserves is to allow the marine ecosystem to function as naturally as possible, in all its diversity. To achieve this there must be a reduction in the removal or harm to fish - and other living organisms such as coral - by commercial and recreational activities.

Top predators of the Pacific Ocean — big eye tuna, striped marlin, yellowfin tuna and swordfish — will all benefit from a reduction in longline fishing in the Coral Sea (longline fishing is the deployment of lines tens of kilometres long with baited hooks). However the above species are migratory, and will not have a secure future until fishing effort is brought down to sustainable levels by the nations in the Western and Central Pacific Tuna Commission that heavily fish these very same stocks.

Having said that, there are several other fish and creatures — not targeted but still caught by indiscriminate longlining — that will benefit from reduced fishing in the Coral Sea. These species include sharks, which are overexploited in the whole of the east coast. In addition there will be a welcome reduction in interactions with protected turtles, seabirds and whales. Restrictions on game and recreational fishing in the protected Coral Sea will also reduce the pressure on top predators.

Compensation could be affordable and beneficial

There is no statutory obligation for Australian governments to compensate for the loss of access to marine resources by the private sector and their transfer to the public benefit. Nevertheless, it is recognised by the Commonwealth that, on the basis of fairness, it is desirable to make compensation available.

While the proposed Coral Sea Marine Sanctuary is vast, and by far the largest of the protected areas, its fishing industry is small. The Coral Sea Fishery took only 0.7 tonnes of mixed species in year 2009-2010. Those most affected by a decision to close areas to fishing will likely be the ten longline boats with permits to fish in what is the northern part of the Eastern Tuna and Billfish Fishery.

It would be undesirable to force fishers displaced by Coral Sea protection to transfer their effort further south. Far preferable to forcing relocation will be providing an “exit package”, including the buyout of statutory fishing rights, which will reduce fishing effort and improve the profitability of the remaining fishers.

Given the small number of operators, this buyout will not be very costly for the Commonwealth. Moreover, an appropriate package should be welcomed by the fishers, given that the average longline vessel has made consistent losses over the past ten years. Fuel and labour costs keep increasing, while the Australian dollar’s rise has reduced export prices for fish and damaged the domestic market by making fish imports cheaper. These trends are unlikely to be reversed.

Most Queensland boats operate in vertically integrated structures where fish harvesting businesses are also fish processors. For the land-based arms of businesses, exit assistance can be augmented by restructuring assistance for those remaining.

Have lessons been learned in creating marine protected areas?

The Coral Sea initiative is just one of several representative marine protected areas (you can see the map here) planned for federal waters and announced yesterday. Other zones are the temperate east, the south west, north west and north.

The serious question concerning compensation for fishing industries displaced by these vast marine protected areas is, has the Commonwealth learned all the lessons of 2004? The Howard government was completely unprepared to handle the impacts on fishing and related businesses when it increased green zones in the Great Barrier Reef Marine Park from 4% to 33%. It didn’t develop an effective method of handling the avalanche of complaints and claims — from Cairns to Gladstone — from fishers and fishing-dependent industries. Furthermore, on the basis of faulty advice, the government had allocated only $10 million for the compensation and adjustment process.

The political fallout was so intense that it threatened to completely unravel the bold plan for increasing the protection of the Reef. A compensation package that was progressively improved saved the initiative and some $250 million was eventually spent. But the process dragged on for six years and in that time many businesses went broke. The prolonged uncertainty about the future of fishing reduced the value of industry assets and choked off investment. Since then the Commonwealth has had more success with a package to offset fishing effort displacement and other socio-economic impacts from the introduction of Commonwealth’s South East Marine Protected Area Network.

The Commonwealth’s Fisheries Adjustment Policy says that “A socio-economic assessment will be prepared to guide decision making and to ensure the implications of marine protected area proposals are known to the government before any decision for adjustment assistance is made”. Duly, ABARES (Australian Bureau of Agricultural and Resource Economics and Sciences) and DSEWPaC (Department of Sustainability, Environment, Water, Population and Communities) have worked with the fishing industry to identify how the proposed reserves would potentially impact fishing businesses and regional communities.

And Tony Burke said on June 14, “On the precise impact on individual businesses we’ve got to work them through and the Department will be having those discussions with individual businesses over the coming months as we put the management plans down.”

The key point here is that compensation will be delivered to fishing and related businesses on a case-by-case basis. While this is the way to achieve equitable results, it does require the application of large amounts of administrative resources. And the stakeholders in the marine protected areas are diverse and far-flung.

Hopefully, the Department will have marshalled sufficient specialised resources to achieve a swift and broad introduction of an easily-understood and equitable compensation mechanism. A protracted process will be costly both economically and socially.