128 UCENSINCi THK SMAI I I R ( OMMI RCIAI HSIII-RirS 



In addition to these arrangements for the IihhJ and bait 

 fisher\, several kinds o(" special permits are issueil for a 

 variety ot uses of herring, including spt)rt or commercial 

 bait, zoo and .uiuaruim ftHKl. domestic food and chari- 

 ties, among lUhers. The [X-rmits are issueil to persons and 

 authon/e them to catch a s|X'cifie*.l quota, lo be eligible 

 for these permits, applicants must satisfy the Department 

 that their use of herring will fit into one of these categor- 

 ies. 



The present regulatory sytem is obviously inadequate, 

 and the waste and inefficiency associated with the food- 

 hernng fishery should be tolerated no longer. For- 

 tunately, the sfxcial circumstances of this fishery lend 

 themselves well to reforms that would convert the licens- 

 ing arrangements to a simple c|uota licensing system, 

 which would significantly improve the performance of 

 this industry. To this end, I recommend that the follow- 

 ing steps be taken: 



17. TJh? present iiiinisterial permit system for autliorizing 

 herring Kshing fur food, bait and minor uses should be 

 replaced in 1983 with a system of quota licences sup- 

 plemented with temporary quota pemiits. 



18. A total allowable catch to be taken in this fishery 

 should he detemiincd for any zone in which fishing is 

 to be authorized. 



The Department's pledge that past participation will 

 not be a condition for entering this fishery should be 

 honoured, but it precludes allocating initial quotas 

 according to recent catches, as I have proposed for other 

 fisheries. In my Preliminary Report, I proposed that all 

 eligible applicants should be allocated equal quotas, but I 

 have since been persuaded that this would be too difficult 

 to administer and that alternative methods should be 

 used to reconcile the allocations with the general licens- 

 ing policy I have already outlined. 



I therefore propose the following special arrangements 

 for allocating the allowable catch in these fisheries: 



19. One-tenth of the total allowable catch determined for 

 1983 should be allocated in new lO-year quota 

 licences; the remainder should be allocated under one- 

 year permits. In both cases the allocations should be 

 made asing sealed-tender bidding procedures. Eligible 

 bidders for the 10-year licences should be limited to 

 those who recorded landings in these fisheries in 1980 

 or 1981; bidding for one-year permits should be unre- 

 stricted. The amount of quota authorized in 10-year 

 quota licences should vary to accommodate operations 

 of differing requirements. 



20. In each following year, an additional one-tenth of the 

 current total allowable catch should be allocated under 

 10-year quota licences, the remainder under one-year 

 permits, until the full allowable catch is licensed. Eli- 



gibility to bid r«>r all of IIk-m- sul>se<|nent allocations 

 should Ik* unrestricte<l. 



21. Most of iIk- present restrictions (»n this fislicry should 

 be alMtlishcHl, notably tla- catcher-delivery require- 

 UR'nt, the 18-lM»ur delivery nile, tlie 25-ton limit per 

 deliver), and the restrictwl opening periods. Tlie pres- 

 ent nine separate Tonus of special iR-rring permits for 

 particular purp4»ses should he eliminated. 



These procedures involve a more abrupt transition to 

 competitive allocation of fishing privileges than I have 

 recommended for other fisheries. However, relatively few 

 fishermen are heavily dependent on this fishery. For 

 most, it is a season adjunct to other fisheries, and it does 

 not involve heavy investment in specialized gear. The 

 transitional arrangements I have recommended will give 

 all those who have been promised participation in this 

 fishery an opportunity to do .so. They will also enable a 

 cautious and gradual approach to the allocation of long- 

 term licences, which is important in view of the economic 

 uncertainties presently surrounding these fisheries. The 

 initial royalties I propose in Table 8-1 are the same as 

 those for roe-herring because both fisheries draw upon 

 the same resources. As a general policy, the Department 

 should allocate the available yields of herring among 

 these fisheries in a way that will maximize their economic 

 value. 



Apart from the modifications noted, these recommen- 

 dations were made in my Preliminary Report. The Minis- 

 ter has since declared his intention to pursue them and 

 has appointed a committee to advise on implementation. 

 But he excluded from his announced intentions the levy- 

 ing of the proposed royalty. In this, as in other fisheries, 

 the royalty must be regarded as the means to control 

 appreciation of licences" market value and to return to 

 the public a share of the value of resources used. So I 

 reiterate the importance of providing for a royalty on 

 quota from the outset of the new system of licensing. 



Fixing the total catch through quotas and relaxing the 

 tight restrictions on fishing time can be expected to result 

 in much improved handling offish and better use of ves- 

 sel and plant capacity. Processors and fishermen will 

 probably find it advantageous to contract for landings 

 over particular periods to smooth operations and take 

 best advantage offish quality. In the more orderly fishing 

 that will result, the fishermen should be able to improve 

 substantially the quality offish delivered and they should 

 have strong incentives to do so. With fewer regulations of 

 this sort, surveillance and inspections can concentrate on 

 accurate recording of landings. 



The number of vessels operating in the fishery will 

 undoubtedly decline to a smaller and more appropriate 

 number in relation to the allowable catch than has 

 recently engaged in this fishery. Fewer vessels and fewer. 



