Grant Leeworthy
22 Mitchell St
Seaford VIC 3198
M: 0408355012
Mr Travis Dowling
Executive Director
Fisheries Victoria
Department of Economic Development, Jobs, Transport and Resources
Government of Victoria
CC: Bill Lussier, The Hon. Jaala Pulford MP.
12th June 2015
Re: Quota setting and access to the Port Phillip Bay Scallop Dive Fishery
Dear Travis,
Thank you for the opportunity to make a submission with regard to quota setting for the Port Phillip
Bay Scallop Dive Fishery. I have been mindful of Bill Lussier’s instruction to me that this consultation
was not a vote but that our submissions would be carefully considered according to the content and
veracity of the arguments put forward. This is fortuitous considering the poorly conceived rumours
and petition put forward by some people with a very narrow and somewhat misconstrued view of
the ‘greater good’. Indeed the last consultation regarding this fishery ignored the 123 submissions
that were in favour of a merit based allocation. I am confident that if you questioned a truly
representative cross section of the general public on whether the fishery should go ahead and
whether the principles of ‘reward for effort’ and ‘a fair go’ should be embodied in the decision, I am
confident that you would get a resounding ‘yes’ in reply. Even on consideration of the name of your
Department, you have the responsibility for creating jobs and opportunity and seeing that economic
development is pursued.
To quote the Hon. Lisa Neville MP from HANSARD 16th Oct 2013:
“…the Port Phillip Bay Scallop Dive Fishery Association, which has been working in this space for a
very long time now—in fact, since 2009 when it first met with the then minister—has put quite a lot
of money into this space. It did all the initial resource assessments in 2011 and then again in 2012,
and it has had meetings with the minister and the parliamentary secretary about this. They were
assured about a process, and they have put in submissions.
It appears to me that the issues they have raised, the issues around potentially breaching
competition principles et cetera that have come out of the final decision to have a single option,
indicate to me that in relation to the issue of consultation and working with the industry, those who
have had the most to gain by good management practices in these fisheries have not been taken
seriously and have not been consulted properly.”
We have asked for an appeal on the merits of our application for a licence lodged to Fisheries
Victoria in good faith in 2011 prior to any policy being released by the Department preventing the
assessment of our application on good faith and upon the merits. We are yet to have our right to be
heard satisfied. While we wait for this process to complete, we ask that no more than 25% of the
TACC is allocated at this stage pending the outcome of our appeal or consideration by the Minister,
the Hon. Jaala Pulford of the merits of our licence application made under the Fisheries Act 1995 in
2011 (and previously in 1998, 2004 and 2009).
Why have a scallop dive fishery?
Having been out of work in Geelong before, I know what the despondency of unemployment feels
like, a cycle of continual hope and rejection. Then after getting a good job, having the business close
some six weeks later and turning up to work finding a guard dog and a locked gate, then being
forced to travel 2.5hrs each way to work in Carrum Downs and then being let go after that company
too folded after we had moved our family to be closer. During this time I became resolute that we
would create our own employment by continuing to apply to develop the scallop dive fishery which
we had first applied for in 1998. A scallop dive fishery allows for employment and opportunity. It
allows for jobs for people that may not have necessarily completed high school and even those with
troubled pasts. A job such as diving for scallops would give people self-esteem and the opportunity
to become self-sufficient. We anticipate that scallop diving will be a pathway for young employees to
get something behind them and move on to other work and employment in the marine or other
industries.
I had the privilege of attending the last Victorian Parliament on the day the valedictory speeches
were given from the retiring MPs. Many impassioned and noble speeches were given on a day that
showed the collegiate and bipartisan best of the Parliament. I refer specifically to the subject matter
of Former AFL football star, and all round nice guy, the Hon. Justin Madden’s valedictory speech. He
specifically cited the need to engage young people in the workforce and that the lack of opportunity
needed to be addressed. It is likely that we will see a fair degree of employee turnover in diving roles
in this fishery. This will allow for greater dissipation of economic rents and benefits through the
community from this fishery. We will aim to be a model employer with divers moving on to other
trades and opportunities from the skills base gained in our industry. All of this of course is
hypothetical and dependent upon our members successfully gaining access to the fishery we
created.
In summary, a scallop resource, otherwise being wasted or at least under-utilised, could be
harvested, to provide jobs and opportunity and replace imported product with a high quality local
product that is highly in demand. Livelihood creation enables young men and women to engage
meaningfully in the workforce and be more likely to be able to set stable goals for their future. It is
beholden on a responsible Government to support such efforts.
TACC Setting
In setting the TACC, I believe a precautionary approach should be taken. Sustainability is something
that is not a self-evident fact, it needs to be demonstrated. This can be achieved through adaptive
management which works incredibly well for a short lived species such as Pecten fumatus. What we
need to do is demonstrate the monitoring capacity of the scallop dive fleet. This is something we
committed to in our consultation with recreational fishing bodies which we were asked to do under
the previous Minister for Agriculture the Hon. Joe Helper. Our members have the capacity to satisfy
the recreational fishing community that the resource is being managed sustainably and also that
recreational fishing opportunity is not inhibited. Indeed, this was one of our proposed performance
measures that initially gained the support of the recreational fishing community. We are confident
that we can gain the confidence of the recreational fishing community again if we are involved with
the fishery.
Whilst ocean scallop fisheries are often fished at exploitation rates of up to 40% of standing stock,
they have a history of variability. As there is a poor stock/recruitment relationship, a low stock can
yield a high biomass and a high stock can yield a low biomass. There are several reasons for this. 1.
Large mortality events occur after 3 years of growth with up to 95% of the stock being eaten by
crabs and starfish. 2. Recruitment success is highly variable according to the vagaries of nature
particularly in the water column during the larval phases of growth and further in the survival of
juveniles below 35mm subject to predation pressure. 3. The Allee effect can possibly be causing poor
fertilization success in stocks that are caught in ocean dredge or drag fisheries with high trashing
rates also potentially inhibiting reproductive success/stress related gonad resorption. This third issue
can potentially be overcome in a dive fishery through good spatial management, allowing for the
spread of effort so the stock is evenly spaced during spawning and potentially more resilient after
spawning when they are at their weakest. Whilst this remains to be demonstrated in practice, in
theory it effectively hedges our bets toward better reproductive success. As hand harvest has no
negative effects on residual stock, we are heading in the right direction. The stock assessment
completed by our association, suggested a biomass of approximately 2500t. The stock has noticeably
increased but these estimates are for the period prior to this year’s spawning where a high degree of
natural mortality may have occurred. Whilst theoretically if the stock was in such a condition
currently a larger TACC could be taken, we lack the real time data necessary to make such a decision.
In-season quota adjustment could happen in the future if adequate levels of data monitoring were
to be provided to Government. If we are engaged in the fishery we will be able to provide such
information to Government and Recreational Fishing interests in a timely manner. On balance I
suggest a TACC of just 108t initially.
How should the TACC be allocated?
We suggest a fair percentage of the TACC should be allocated to the current operator in the fishery
but we note that it would be against Victorian statute to allocate over 50% of the TACC to one entity
as it would represent a departure from competition policy enshrined in Victorian statute. It is a
legislative responsibility to ‘encourage competition’ and it cannot be demonstrated as to how
Fisheries Victoria has achieved this to date. Shortcomings in the original allocation process should be
addressed by the allocation of the TACC, namely, the lack of consideration of the Competition
Principles Agreement 1995 and current best practice in the development of new fisheries which
allows for the merit based issue of licences to the proponents and developers of the new fishery.
The Hon. Lisa Neville MP raised these issues in the parliamentary debate regarding the fishery but as
yet they have not been addressed. The resource belongs to the community and it is the
responsibility of the Department to allocate the resource in accordance with community
expectations including the need to regard the need to allocate in a manner that allows for
competition which is congruent according to law. Section 3a of the Fisheries Act 1995 should be
considered further particularly with regard to ‘efficiency’. Further to this, the denial of our common
law appeal rights to date creates a situation where our appeal on the merits may still be considered
‘on foot’. The jurisdictional fact restriction on a fair hearing on the merits of our application for a
licence has been removed by recent events. This includes, we submit, the timeline consideration.
We ask Fisheries Victoria and the Minister to consider these requirements and to consider the work
we have put in as the proponents of this fishery. The initial allocation was set up in a manner that we
could not be reasonably expected to engage in, having told the former Minister and senior
Departmental staff directly that we lacked funds to compete in a speculation driven, horse race
auction. We submit that this was unfair considering our years of hard work and effort in creating the
fishery and our current application that predated this convoluted side show spectacle where we had
to be pitted against the financial advisers of celebrity chefs. While the auction process may have
been fair for up to 50% of the resource allocation, it was not for us considering our application
predated this process (this is in line with AFMA policy that 50% could be allocated to the developers
of the fishery and 50% via auction). The non-viable nature of the 12t trial associated with the zoning
and the size limit that was not based on any relevant science combined to ensure we could not raise
funds or have any hope of servicing a debt if we were to convince any lender to part with their funds
on our behalf. This goes against the very nature of the ‘reward for effort’ principle and strikes at the
heart of any hope for young innovators to pursue their dreams if Government cannot demonstrate
supporting such efforts. We do not allege any wrong doing but at least we have been treated in ‘bad
faith’ thus far most likely due to negligence or a pervading, mistaken, paternalistic ideal that we
should become employees and not independent operators in the fishery – this is not adequate. The
argument that competition was provided for by creating the fishery, is not valid considering the
legislative responsibility to encourage competition. As we are still awaiting an outcome to these
matters, no more than 50% of the TACC should be allocated to the incumbent.
Management Plan
It is unclear how the Statement of Management Arrangements sit in the legislative framework.
Clearly they do not constitute a Management Plan and it appears they are not policy. A basic
Management Plan needs to be developed for this fishery that meets the requirements of the
Fisheries Act 1995.
Size Limit
The size limit originally set for the fishery was incorrect and will still remain problematic for the
fishery. We suggest that this is subject to review of the science behind this and also ongoing
discussion between Fisheries Victoria and the industry and VRFish. If we gain access to the fishery,
we are confident that we can demonstrate sustainability in all aspects of the operation. While this
may be an on-going discussion, the data presented to Fisheries Victoria prior to the opening of the
fishery showed the size limit to be too high and based on flawed assumptions. Good spatial
management will be the primary tool for preventing serial depletion in this fishery and not the size
limit. Kernel Density Estimation of spatial patterns of fishing effort and other similar methods will be
employed to demonstrate sustainability.
Future developments
Former Commercial Fisheries Manager Mr Steve McCormack suggests that virgin biomass of scallops
in Port Phillip Bay was much larger than the top catches of the dredge fleet (16000-18000t shell
weight). He is a good person to ask for a straight opinion. We think we can design an introduced
seastar removal device with the aid of image recognition technology. This may increase yields into
the foreseeable future, doubling biomass as markets grow. Mortality due to predation of the
approximately 35mm size class is halving the potential biomass in certain areas of Port Phillip Bay.
The Hokkaido Scallop Enhanced Fishery is a model for overcoming these issues. I conducted the first
successful scallop spawning in Victoria in my kitchen in Seaford and since then two scallop
spawnings have occurred albeit with mixed success. We will continue to invest in these areas of
research and development to create a globally significant scallop industry. Safety development will
also be a priority. We have invented several key innovations to enable safe operation and it is
important that several approaches to safe operations are demonstrated. Innovation occurs best in a
competitive environment. If we enter the fishery however we will see a great deal of cooperation on
the issues of safety, resource management and recreational dive fishery consultation.
Questions remain as to how no due diligence was conducted on the state of this resource prior to
the auction of the single licence for 12t. There is no legitimate expectation for a Government
Department to breach the legislative requirement for encouraging competition so no compensation
is due to the current operator if they receive 25-50% of the TACC considering the capitalised value of
27t-54t of scallop quota in this fishery, there should be no cause for complaint even in light of the
‘race to spend’ that the incumbent has engaged in. Indeed, this increase in value represents a
‘windfall gain’ that was supposed to be prevented by the process. Why, after we were advised that
the lack of scientific knowledge was an inhibiting factor to the development of the fishery, did
Fisheries Victoria pretend to ignore our stock assessment and say it was not considered or relevant?
In suggesting that a stock assessment was not needed prior to the auction, how did Fisheries Victoria
maximize the return to the State of Victoria (the stated goal) by holding an auction process? If the
stock assessment was to cost just circa $60K, why did Fisheries Victoria not spend this money to
complete due diligence prior to the Auction of a resource that could potentially have a sustainable
harvest rate of 725t? The fishery once supported many Victorian families and there is no rational
argument to allocate all of the TACC to just one entity. I trust that Fisheries Victoria will seek to
correct these mistakes. It is a given that these mistakes occurred under a previous Government and
executive management team. I do not intend to dwell on unproductive blame, we just want to move
forward. It is my hope that these issues are sorted out and this allows the industry to develop to its
full potential with the creation of a diverse range of livelihoods in the State of Victoria. It would be a
folly of Government to allocate this potentially globally significant resource to a single owner with no
consideration of dissipating economic rents through the community. Our Association represents
three families and an additional two will also be beneficiaries in the first instance before accounting
for employment benefits. We ask for our appeal rights to be granted so we can have our common
law right to be heard met and we can carry on with the development of this industry in a productive
and cooperative manner.
Opportunity should not be limited to those who have opportunity already. Thank you for considering
my submission.
Best Regards,
Grant Leeworthy
President
Port Phillip Bay Scallop Dive Fishery Association Inc.
BSc.Hons (Fisheries Management and Aquaculture)
PhD studies in progress.