Simon Coveney (Cork South Central, Fine Gael)

I will be as brief as possible on fisheries so that we have as long as possible for questions but there are significant matters happening in fishing and I would like to give a broad outline to Members. Yesterday, I was in a European Council meeting debating the initial draft produced by Commissioner Damanaki on the reform of the Common Fisheries Policy. I should have said that Ireland is in a hugely influential position on the Common Agricultural Policy and the Common Fisheries Policy because the timeframe for getting agreement on both will spill over into the Irish Presidency in the first half of 2013. The aim of the EU is to have a deal done on both by the end of next year but everyone recognises it is unlikely that target will be met. Budgets have been set in anticipation of this. Ireland takes the Presidency of the EU for the first six months of 2013, which gives us a fantastic opportunity to be the dealmakers on the Common Fisheries Policy, the Common Agricultural Policy and the financial perspectives for the overall EU budget. It is a great opportunity for us to restore our reputation as a country that can put positive deals in place as opposed to being associated with the difficulties the EU has at the moment.

Yesterday was the opening debate on the Common Fisheries Policy after much shadow-boxing. On a bilateral basis with Commissioner Damanaki in public and in private, I have set out some of the concerns we anticipate from the Irish perspective in respect of the Common Fisheries Policy. Some of those concerns remain, even after the debate yesterday, and I will set out one or two of them that are significant.

The Commissioner is planning to reform fundamentally how the fishing industry operates across the European Union. She wants to change the way in which quota is allocated. At present, quota is a national asset and it is up to the Government, in consultation with the fishing industry, to allocate quota in a way that best suits the coastal communities, the fishing industry and the protection of fish stocks. If we do not protect fish stocks, we will have no fishing industry in the years ahead. Each year, we fight for our share of quota in December and the Government allocates quota to fleets in a complex negotiation structure with the industry. There is a reasonable degree of certainty and consistency from the perspective of the fishing industry because cuts in quota are always anticipated before the December discussions. The Commissioner is saying there are too many boats in fishing fleets across the EU and we do not have the quota to satisfy demand. The proposal is to give quota to boats and allow them to trade quota among themselves. In other words, if somebody wants to get out of fishing they can sell or lease on the quota allocated to them to another boat owner.

The Commissioner wants to see the industry consolidate into smaller numbers of bigger boats which will be easier to manage in the future. She states that a quota will only be able to be transferable - she is calling them fishing concessions but essentially they are quotas - within member states. That makes some sense from an economic, efficiency, stock management and business point of view but it does not make much sense in terms of the other elements we need to protect as politicians or in terms of keeping fishing communities viable and intact because what we will see in Ireland is consolidation into two or three fishing ports. The others will be unable to survive, be they the onshore businesses around processing and adding value, or the fleets themselves.

Of much more concern to me is that the Spanish fishing industry, which is the biggest in Europe, has a fleet that is too big for its quota and the Spanish want to be able to buy quota from elsewhere to meet demand for catch. My big fear, and the fear of my Department - there are many well-informed people in my Department who understand the industry very well - is that we will not be able to limit the transfer of quota to boats within the member state and that we will see the transfer of what was Irish quota in the past out of Ireland into Spanish, French, Dutch, British fleets and so on. As a result our ports will never see those fish. That would be the start of the end of the Irish fishing industry.

We are very concerned that the Commission has not put in place safeguards we believe are credible to ensure the transferability of quotas within member states and that quota does not move out of Ireland. It is something about which the industry is also very concerned. I am very concerned about, and I have been blunt with the Commission on this aspect. It will be a major point of debate and disagreement over the next 18 months or so.

However, we have some allies. We have managed to convince both Germany and France that transferring and essentially privatising quotas is not such a good idea because once it is taken out of state control as a state asset control is lost and cannot be retrieved. The Commission is saying that if we want to get quota back from someone they have to be given 15 years notice. That makes no sense.

As far as I am concerned quota in Ireland is a national asset. Nobody owns it, including trawlermen. We own it as a State. We allocate it to our fleet. There are flaws in the system but it is a better option for us to continue with a system or a revised system along a similar model to what we have currently than change to a system which lets the market decide who gets quota. In that scenario people with the most money will buy up quota from elsewhere. The transferability of individual transferable quotas, ITQs, or individual transferable concessions as the Commissioner now refers to them, poses great threats to the Irish industry and we must argue for a change of tack on that issue.

The second issue on which I strongly agree with the Commissioner but not her approach is that of discards. We have an indefensible position whereby hundreds of thousands of tonnes of fish are being caught, killed and thrown back into the sea because fishermen do not have quotas to catch them. A number of different problems arise in that regard. There are what are called juvenile fish, in other words, fish that are not marketable because they are not big enough to sell but they are the same species as one has a quota to catch. In some fisheries we catch up to four or five juvenile fish and kill them before we can land one marketable adult fish. That makes no sense on any level in terms of stock management or anything else.

The second problem with discards is that one catches in mixed fisheries another fish for which one does not have a quota to catch. For example, if someone has a quota to catch haddock and whiting in the Celtic Sea and they are catching cod in their net in that mixed fishery, which they will do, but they do not have a quota to land cod they have to dump cod over the side. That is happening as we speak because there is a huge increase in cod numbers in the Celtic Sea. We have adult, marketable, valuable fish being thrown over the side and at the same time we are talking about trying to reduce the number of discards.

The Commission is proposing that, over time, we will ban all discards. Trawlers would have to land everything they catch on shore. That makes some sense for what I would describe as clean fisheries. If someone is only catching one species and they over-catch on a certain catch it makes sense that they land the extra. They do not get paid for it but they are forced to land it. At least they know it is being caught.

The position on mixed fisheries is more complex. They cannot land everything they catch because they do not have a quota or they may be catching fish that are outside of quota and protected. We must have much more discussion with the industry on the way we deal with the discards issue but we must do something fundamental in terms of changing the current scenario where I would estimate up to 300,000 to 400,000 tonnes of dead fish are thrown over the side each year in Irish waters. We catch approximately 1.2 million tonnes of fish each year. There is probably more than that caught but there is a quota to catch that number.

We are working with the industry and the industry is responding to put in place pilot projects on discards, particularly in what is called the biologically sensitive area, which is the Irish box off the south coast of Ireland. We will be examining pilot projects on discards in fisheries such as, for example, monkfish, megrim and hake. We have already agreed with the French a pilot project to allow juvenile fish escape in the cod, whiting and haddock fishery in the Celtic Sea. France has signed up to that. Yesterday in the Commission, outside the discussion on the Common Fisheries Policy, we got agreement in principle from the Commission that it will increase the total allowable catch for cod in the Irish Sea this year. It will revise the quota as long as we put the juvenile fish escape measures in place, which is a square net at the back of a trawled net to allow juvenile fish to escape.

The industry is leading with these initiatives. Fishermen are often painted as people who do not care about discards or stock management and who are only in fishing for the immediate and short-term quick buck. My experience of those in the fishing industry is that they are much more sophisticated than that. They have put in place stock management programmes that have worked, and cod in the Celtic Sea is one of the good examples of that because it was the fishing industry which asked for what are called set-aside areas at sea where there would be no fishing to allow for breeding, growth of fish and so on.

Other issues arise around the Common Fisheries Policy. These include the regionalisation of decision making; ensuring that fish imported into the European Union are produced to the same environmental standards that we have here to ensure we do not put our people at a disadvantage; and a series of other issues that I do not have time to get into now but on which I will answer questions if Senators wish.

In terms of what we are doing as regards Food Harvest 2020, the fish sector plays a major role in the expansion of the food industry. Senator Quinn spoke about landing non-Irish produced fish into Ireland. That is being encouraged. We had practically the entire French fishing industry in Clonakilty recently and we told them that the highest quota for white fish in Irish waters is in French hands. They are catching huge volumes of fish. They predominantly take all that fish back to France to get processed.

Most of the French fishing industry is owned by French multiples, which are big companies rather than family owned vessels. We decided that we would bring the processing sector from all the ports in Ireland as well as many of the harbour masters to meet French fishing interests in Clonakilty to try to encourage them to land fish close to where it is being caught, which is here in Ireland, because the current price of fuel means it is very expensive for them to steam back to France every time they fill up their hulls. If we can do that, we can have an impact on the volume of fish landed in Ireland. Some 240,000 tonnes were landed here last year although 1.2 million tonnes are actually caught in Irish waters. The jobs in the fishing sector are in processing. If we can double the volume of fish being landed in Irish ports and have those fish processed, graded, packaged and marketed here, there will be very exciting potential for towns such as Killybegs, Rossaveel, Dingle, Castletownbere, Dunmore East and all the other fishing ports that are important and have fish-processing facilities.

My final point on the potential for growth concerns aquaculture. We had a brief conversation on this during our debate some ten days ago. If one considers how the world, not just Ireland, will be fed in ten years and what other countries are doing to provide seafood to their populations, one will note that Europe is way behind. We are still putting wild sea stocks under considerable pressure by trying to catch as much as we can under the limitations that exist. In most countries outside the Union, however, large populations are being fed on farmed fish. China consumes 93,000,000 tonnes of fish each year, 75% of which is farmed. In the European Union, only a fraction of what we eat is farmed, yet most of the fish we import is farmed. Some 70% of what we consume is imported.

Some countries are making significant progress expanding aquaculture and fish farming. Scotland, for example, produced 150,000 tonnes of farmed salmon last year and this volume is growing. Ireland produces 12,000 tonnes. Norway produces 1 million tonnes of farmed salmon and aims to produce 2 million tonnes in five years. Unless Ireland does something about this, it will be producing only 12,000 to 14,000 tonnes, despite our extraordinary natural resources which suit aquaculture.

We have a big stumbling block to get over, namely, the fact that practically all our harbours and bays are in Natura areas, or special areas of conservation. We must go through a long and difficult process even to licence aquaculture, but we are examining in an ambitious way the possibility of facilitating aquaculture outside the bays. I refer to offshore aquaculture which can produce very large volumes of high-value fish for markets with very strong demand. We are working with the Marine Institute, BIM, my Department and the industry to make this happen. I hope there will be some announcements on how we can proceed in an environmentally responsible and sustainable way in the early autumn. We must work with the fishing industry rather than against it when addressing the question of fish stocks.

I will take questions at this stage because I do not want to speak for too long.