Quota Management System


By the early 1980’s fishing had considerably reduced the size of a number of New Zealand major inshore fisheries stocks. In these fisheries commercial catches were declining, the economics of fishing were deteriorating and the recreational fishery was suffering from the reduced availability of fish. There was widespread agreement that the consequences of continuing with traditional management measures would have resulted in the economic collapse of some commercial fisheries and that the recreational fishery would have continued to decline.

Quota Management SystemAt that time traditional management of inshore fisheries was principally by means of input controls, including restrictions on fishing methods, areas, fish sizes and limits on vessel numbers in specified Controlled Fisheries. These traditional management measures had failed to adequately conserve the resources and new, more comprehensive, initiatives were sought. There was a clear need to reduce catches to levels that would enable fish stocks to recover in size to provide optimum long term sustainable yields to be taken by the most efficient means; and to provide for a satisfactory recreational fishery.

After extensive discussion on the issues and the options, the Government sought cooperation from Industry and other interested groups to introduce a comprehensive solution based on the introduction of private property rights to all major commercial fisheries, in October 1986 the Quota Management System (QMS) was introduced to conserve New Zealand’s major fishery stocks and to improve the economic efficiency of the Seafood industry. In seeking and obtaining a high level of support and cooperation from industry, the Government was assured that the benefits from catch reductions through the introduction of the QMS would be permanent and the industry would restructure to ensure improved economics from the lower catch harvest levels.

The objectives of the QMS introduction were to:

  • Rebuild inshore fish stocks where required
  • Ensure that catches were limited to levels that could be sustained over the long term;
  • Ensure that catches were harvested efficiently with maximum benefit to industry and to New Zealand;
  • Allocate catch entitlements equitably based on individual permit holder’s commitment to the fishery;
  • Manage the fisheries so that Industry retains maximum security of access and flexibility of harvesting;
  • Integrate the management system, which can be applied both nationally and regionally;
  • Provide financial assistance to facilitate restructuring of the Seafood Industry to meet the above regionally;
  • Enhance the recreational fishery.

Development of the deep water fisheries during the late 1970’s and early 1980’s was enhanced with the declaration of New Zealand’s 200 Mile Exclusive Economic Zone (EEZ) in 1978. In the early years exploration and development of New Zealand’s huge EEZ, the fifth largest in the world, was largely facilitated by the fishing capabilities of countries such as Japan, Korea and the USSR. During the late 1970’s, fishing by foreign licensed nations was progressively replaced by joint ventures between New Zealand fishing companies and foreign fishing companies.

By the early 1980’s, the level of investment in the deep water fisheries by New Zealand companies (through joint venture operations, investment in vessels, onshore plant and market development) provided the need for a comprehensive management regime that would allow for further development, provide for resource conservation and maximise the economic benefits to New Zealand.

In 1983 a management regimes based on company held ITQ was introduced for the 7 main deep water species; hake, hoki, ling, oreo, orange roughy, squid and silver warehou. While the scheme was immediately successful, it did not adequately provide a mechanism for the transfer of these ITQ. In 1986 the deep water fisheries were brought under the QMS and the company held ITQ was transferred into Individual Transferable Quota (ITQ).

Although there have been a number of revisions and enhancements to the mechanisms and administrative procedures of the QMS since 1986, its essential elements remain the same. Government officials still work closely with Seafood Industry Representatives and those from other interest groups, to review annual Total Allowable Commercial Catch (TACC) levels based on the best available research advice and to improve the administration and compliance with the QMS.

Most of the deep water fisheries are now considered fully developed with TACCs for fish stocks set at or about the Maximum Sustainable Yield (MSY) levels. Most of the inshore fisheries are now considered to be in a healthy state, with stocks recovering to levels at or near to those, which are able to produce the MSY.

For the number of inshore stocks the TACCs have been increased, reflecting the successes of stock rebuilding. Rock lobster populations have been rebuilt through the use of low TACCs in conjunction with other management controls, and now produce significantly enhanced catch rates. In the southern scallop fishery, private ownership of catching rights has facilitated the enhancement of the wild fishery by quota owners to produce annual catches greater than the long term average catches from the wild fishery.

Moreover, whilst the success of the QMS can be measured in the health of New Zealand’s fish stocks, the social benefits are demonstrated in the improved economic of harvesting, processing and marketing catches from these valuable resources. The QMS has provided quota owners with security of access to raw materials, around which long term investment plans for vessels, onshore plant, and markets have been established. Prior to the QMS the incentive for each permit holder was to maximise catch at the expense of competing operators and the resource. The QMS has provided quota holders with the incentive to maximise product value and to develop a range of premium quality, value-added and niche market products. The New Zealand seafood industry is primarily export orientated and although not largely by world standards, has a well established international reputation of a quality supplier of premium quality seafood. The QMS has played a pivotal role in ensuring sustainability of New Zealand seafood supplies and providing the environment for economic efficiencies in harvesting, processing and marketing. NZ now earns 50 times more from seafood exports (NZ 1.3 billion a year) than it did in 1970s (less than NZ$20 million a year).

With the introduction of the QMS, the Government required quota owners to contribute to the costs of managing and administering New Zealand’s commercial fisheries. Initially, under a ‘resource rental’ regime, Industry directly contributed approximately half of the Government's annual costs, in addition to normal taxation contributions. Modifications to this regime over the past fifteen years have resulted in the industry now paying for all of the research and management costs attributable to commercial fisheries, as well as a contribution to other fisheries' administration and policy expenses. Industry participation has now extended to running administrative services, previously run by the Government, on a contract basis.

The Ministry of Fisheries is the Government department charged with the management of NZ fisheries, although other ministries and departments impinge upon this brief, most notably the Maritime Safety Authority and the Department of Conservation.

The purpose of the main legislation affecting fisheries, the Fisheries Act 1996, is to provide for the utilisation of fisheries resources while ensuring their sustainability.

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