Sissenwine and Mace. ITQ management in New Zealand 



155 



government announced its intentions to convert the 

 system to proportional ITQs until the change became 

 effective on 1 April 1990. 



The actual details of how the conversion will be im- 

 plemented had not been determined at the time this 

 paper was written, but some difficulties are almost 

 certain to be encountered. In order to gain industry 

 acceptance of the change, government agreed to freeze 

 resource rental rates for five years, and redistribute 

 these funds to compensate industry for quota reduc- 

 tions. Industry may have misjudged the amount of com- 

 pensation it will receive, since several of the species 

 that are most likely to have large quota reductions are 

 also the species that generate most of the resource 

 rentals (e.g., orange roughy, hoki, squid). Therefore, 

 the greater the reductions, the smaller the pool of funds 

 available for compensation. 



One implication of converting from ITQ in fixed 

 amounts to proportional ITQ is that there will be 

 pressure to change the method of yield estimation from 

 an MCY strategy to a CAY strategy, with consequent 

 increases in the amount and variety of assessment in- 

 formation required. With quota as a fixed amount, 

 there was little change in TACs from year to year. With 

 ITQs as a proportion of the TAG, there will be greater 

 pressure from the industry to change TACs (particular- 

 ly to increase them when stock size is perceived to be 

 high). 



Treaty of Waitangi 



The Maori people have sued for rights to the fisheries 

 under the terms of the Treaty of Waitangi. There are 

 several related cases which had not been settled at 

 the time this paper was written, but it appears that 

 the Maori people are entitled to a significant amount 

 of quota. Prior to the ITQ system, when there was 

 no ownership of the fisheries, there was less incentive 

 for the Maoris to exercise provisions of the Treaty 

 of Waitangi. But when property rights were estab- 

 lished, and many Maoris were excluded from the 

 system because they were part-time fish harvesters 

 who had already been removed from the fishery, it 

 was inevitable that a controversy would follow. Bevin 

 et al. (1989) reported that industry has delayed major 

 investments in the fisheries because of uncertainty 

 about Maori fishing rights. Industry is concerned that 

 the eventual settlement with the Maoris will be at 

 their expense (i.e., they will not be compensated for 

 quota that is transferred to Maori ownership). The 

 dispute over the Treaty of Waitangi has also caused 

 government to delay adding important species into the 

 ITQ system. 



Stock assessments 



The scientific basis for assessing fish stocks, setting 

 TACs, and evaluating the overall performance of the 

 ITQ system is generally inadequate. New Zealand had 

 relatively little need for stock assessment capability 

 prior to ITQs. For the most part, their fisheries man- 

 agement was laissez-faire. In the case of data for 

 assessing deepwater species, New Zealand relied heav- 

 ily on foreign research vessels. When ITQs were im- 

 plemented, they were ill-prepared, in the opinion of the 

 authors, to conduct stock assessments for all of the 

 management units included in the system. The situa- 

 tion has improved since the implementation of ITQ 

 management as New Zealand scientists have developed 

 and refined the scientific basis for stock assessments, 

 but they have had inadequate support (e.g., research 

 vessels, data collection systems, and personnel). Inade- 

 quate assessment databases mean that the ITQ system 

 is operating under high levels of uncertainty. The price 

 of uncertainty is either conservative quotas or a high 

 risk of stock collapses. 



Bycatch 



Some bycatch is inevitable in multispecies fisheries. 

 This means harvesters will catch some fish for which 

 they do not own quota. New Zealand planned to 

 manage bycatch with a taxation scheme (referred to 

 as surrendering catch to the government or "Crown"), 

 which was intended to produce a neutral incentive for 

 bycatch. The tax was supposed to be high enough so 

 that harvesters would have no incentive to catch 

 species for which they did not hold quota, but if they 

 caught them as bycatch, it would be worth their while 

 to land them for sale. The problem is knowing what 

 the proper tax level is in order to result in a neutral 

 incentive. In some cases, even taxing 100% of the ex- 

 vessel value does not discourage fishing for species for 

 which harvesters do not hold quota. This is because of 

 vertical integration in the fishing industry and a very 

 high value added during processing. 



There are several other provisions for dealing with 

 bycatch. Quota holders may overcatch by up to 10% 

 in exchange for next year's quota. They may trade 

 retrospectively for quota to cover catch they have 

 already taken. They may trade quota of certain species 

 to cover bycatch of certain other species (for specified 

 combinations of species, often involving one-way trades 

 only). 



Another aspect of the bycatch problem is that it is 

 difficult to distinguish between bycatch problems that 

 are a conservation threat to the bycatch species and 

 those that result from setting the wrong TAC, as a 

 result of imprecise assessments. Regardless of whether 



