Carter David: Aquaculture Reform Bill — Second Reading Instructions to Committee In Committee 
Carter David: Aquaculture Reform Bill — Second Reading Instructions to Committee In Committee 
[Volume:622;Page:17720] 
Hon DAVID CARTER (National) 
: 
 We move on to another very important part of the legislation whereby we amend the Fisheries Act 1996 and develop a system that recognises the ever-competing interests of aquaculture with the other uses of coastal space. The Primary Production Committee was inundated with submissions from people who were concerned about the Ministry of Fisheries’ role particularly with regard to the undue adverse effects test. I can sympathise with the submitters. They have had years and years of management—or more correctly mismanagement—by the ministry. There was a distinct lack of confidence that Part 2 could if enacted be competently carried out. 
I have become very familiar with the legislation and I think this is one aspect of it that the bureaucracy has got right. The bureaucracy has acknowledged that there would be competing interests for aquaculture space. Having accepted that it has tried to develop a mechanism whereby the most economic use of space will come to the fore over a period of time and I support that. As we got into the debate it was clear that when aquaculture was proposed as a use there were three sectors of rights that could be adversely affected: customary fishing rights recreational fishing rights and commercial fishing rights. Most of the committee members were of the opinion that if customary fishing rights and recreational fishing rights were to be severely affected then aquaculturists had to consider finding somewhere else to go. There was an interesting debate around the possibility of a conflict of interest between existing commercial fishers and a proposed aquaculture use. That is an interesting issue when we consider the property rights that are being conveyed on to commercial fishers via the quota management system. 
I would also like to pick up on the comments made by Jim Peters earlier in the debate when he talked about the 1992 deed of settlement. I say to him that the 1992 settlement was very explicit about what it was for. It was a settlement to enable quota management to occur and a settlement of all issues regarding commercial fishing whether it was on shore offshore or coastal fishing. Therefore it quite clearly included aquaculture. But it was also a settlement whereby at that stage in recognition of Maori interests in commercial fishing 20 percent of all the species that were to go into quota would go to Maori. The National Party has no objection to that at all. In clarifying what Mr Jim Peters said let me say that we certainly object to the folklore that has developed at present around unfinished business but I will talk about that at later stages. 
With regard to the undue adverse effect test that acknowledges that if the Ministry of Fisheries recognises that an application for aquaculture will severely impact on commercial fishing rights then we have to develop a process whereby there can be some settlement of that. The legislation as it has come back from the select committee goes a long way towards doing that. The first hurdle the committee had to overcome was a distinct recognition that a property right was associated with people who own quota. In my personal view that was not a problem but I think many members on the select committee had a problem in grappling with the importance of that property right. Once we had achieved recognition that there was a property right then the ministry test had to judge whether the property right was affected adversely enough and we discussed through the select committee processes whether undue adverse effect and the wording associated with that was a strong enough test. At the end of the day I accept what the officials told us—that the test was severe enough—and I hope that proves to be the case. 
The undue adverse effect must be significant. However the solution to the recognition by the Ministry of Fisheries that there is an undue adverse effect is a process of negotiation between the commercial fisher whose property right is affected and the proponent of aquaculture. The bill as it came before the select committee was in the opinion of the committee members unworkable in that the proponent of aquaculture had to obtain 100 percent agreement from all affected commercial fishing property-right owners. After long deliberations and with considerable input from the submitters who appeared before us the possibility of getting 100 percent agreement became a threshold that was too high for the select committee to accept. We therefore developed a significant change in that area whereby a 90 percent acceptance on the part of each and every quota holder by quantum is enough for the test to be satisfied. 
We then dealt with the issue of the remaining minority 10 percent. The Green member Mr Ewen-Street—who I must say put an extremely large amount of work into this legislation and I thank him for that—was of the opinion that maybe that 10 percent had had the opportunity to come to an agreement and if it had not that was simply tough luck. In my opinion that was miles too tough. In many cases it is actually relatively easy to get 90 percent agreement between quota holders because one is dealing with only a couple of them. Maybe some people who own a limited amount of quota would be in that 10 percent group. They have a right to some satisfaction and through the select committee process a mechanism was developed whereby they will be paid out. It is a little like the takeover situation that occurs regularly on the stock exchange now whereby once an acceptance has been reached with 90 percent of shareholders the remaining 10 percent of shareholders are compulsorily wiped out. The select committee has provided a mechanism whereby the people who own the remaining minority 10 percent of quota interest at least have the protection of the High Court. The High Court has the opportunity to measure whether the amount of compensation being paid to the other 90 percent of quota holders is a fair and reasonable amount. 
I think that the select committee has come up with a vast improvement to the legislation as it was originally submitted to the House and that the officials have developed a mechanism that well and truly recognises the competing interests. But at the end of the day it is a matter of the most economic use of the space for New Zealand incorporated and that comes down to who can make the most money out of any particular spot. In saying that I have little doubt that if one measures that on a hectare-by-hectare basis then because of its intensity aquaculture will win the day. Having said that I say that a property right is a property right and that if quota owners are significantly affected then they must be compensated to an extent that makes it worthwhile for them to give away their property rights in order to allow aquaculture to develop. 
I think that is the major change that has been developed in Part 2. There are a number of other minor changes that I want to take the opportunity to speak to through the Committee debate but I look forward to hearing the Minister’s answers to the questions I have raised. I note we now have the third Minister in the chair the Hon Marian Hobbs. We hope she understands the bill somewhat better than the Minister does. He clearly does not understand it at all. That was shown by his answers to an earlier point in Part 1 which I will take the opportunity of re-raising in Part 5 regarding the 20 percent and the patchwork-quilt effect.