Aquaculture Legislation Amendment Bill (No 3)

The CHAIRPERSON (Lindsay Tisch) Link to this

The debate on Part 1 includes schedule 1.

Hon PHIL HEATLEY (Minister of Fisheries and Aquaculture) Link to this

This part includes measures to transition the existing marine farming industry into the new law with minimal disturbance and no loss of rights or certainty. The processing of the last remaining pre-moratorium applications, which are now a decade old, will be able to be completed from the commencement of the new law. The processing of applications frozen under the current law will, in most cases, be able to resume on the commencement of the new law. The aquaculture unit within the Ministry of Fisheries—which has now been merged with the Ministry of Agriculture and Forestry—has worked closely with local authorities to help them get ready for this. The amount of space that is created for aquaculture from those outstanding applications will depend on the decisions of applicants and the outcome of the consent process. What is important is that the process can now move forward.

I would like to inform the Committee that I am not proceeding with the following amendments: on Supplementary Order Paper 264 the amendment entitled “New Schedule 2: paragraph 4”, and on Supplementary Order Paper 265 the amendment entitled “Schedule 1: new Schedule 2”. These changes are superseded by the amendments on Supplementary Order Paper 278.

Hon SHANE JONES (Labour) Link to this

Labour members will be supporting the Aquaculture Legislation Amendment Bill (No 3). I note that we are at the Committee stage, and I want to work through a number of important issues. As is often the case when we support legislation pertaining to a particularly important industry, it is capable of generating more employment, which is a rather rare phenomenon given the stewardship of the Government in its broader economic obligations.

But putting that aside, there are two areas in which, despite our reservations, we will back this bill. I acknowledge that the Minister in the chair, the Minister of Fisheries and Aquaculture, has made a considerable effort to address the broad array of interests. On one side we have residual Māori concerns, and on the other side we have concerns pertaining not only to the industry with its investment in both aquaculture and quota ownership but also, in particular, to those who fear arrogating to central government in the form of the Minister the ability to influence and allocate consents relating to the occupation of space. We have all these kinds of apprehensions, but we do feel, despite the fact that the Minister will have the ability to effect these resource management and coastal plan changes, that the deeper challenge is something that is really a “New Zealand Inc.” story. I mean that it is a bold challenge. It is $1 billion a year worth of export receipts. Unfortunately—the Minister may not recall it; I think it was in 1992-93—the Hon Doug Kidd had a similar heroic goal in mind way back then, to generate $1 billion worth of export receipts. Not everything we did in our golden reign of the last 9 years kicked a goal. This is an area in which changes were made, and I think the rule of unforeseen consequences reminds us that what we do in Parliament and what we delegate down to our bureaucrats to do does not necessarily make sense in relation to people investing, taking a risk, and growing an industry. We always need to be vigilant if we are to crimp the ability of people to enjoy participative democracy. That is the model we have for resource management in New Zealand. We have sought to marry an ideal of social democracy against resource management. We need to be vigilant that we do not swing too far, because if we do, then nothing will ever happen. All sorts of parties believe they have an almost divine right to participate, and end up hobbling those who, with the greatest will in the world, burn too much money before they can go to consent.

Secondly, I, and no doubt my colleague as well, will talk about the test on how we strike a balance between the people who have legal rights to harvest fish within defined areas, and those who want to occupy those areas for marine farming. I think this Minister has the balance about right—well, to the extent that we are prepared to back it. It is important that an industry like this maintains the reputation that when we sell our product overseas—and this is why the allocation of resource consents is essential—we are selling not just the commodity or the organism but also a brand and an experience. At all times, irrespective of who is enjoying the privilege of holding the benches of Treasury, when we compromise that we worsen our ability to make inroads into the market.

There is no shortage of competitors around the world that are more than capable of disgracing our New Zealand name by taking our product and passing it off as something that in actual fact does not reflect what we are capable of generating and selling. It is important that the host environment that creates the produce is subject to a high level of vigilance, but that vigilance must not turn into an opportunity for far too many nit-pickers to participate in the process. Unfortunately, I have had experience of this. In the 1990s we sought to create a marine fish farm off the coast of Whangarei. After we had blown, as I recall, $600,000, $700,000, and still counting we were still no further ahead and no closer to establishing it, as a consequence of the bike-riding, spectacle-wearing, and book-reading Queen’s Counsel lawyers from Auckland who had baches there. They denied us, who were taking a risk and creating, in this vacant space of the ocean, a business. What were we going to do? We were going to generate jobs and try—odd as it might sound to the current Government—to generate wealth through the export in value-added form of New Zealand’s clean, green produce. A number of these hapless individuals who have far more money than sense visited their connections and networks upon us struggling Northlanders—largely of Māori extraction—as we sought to create this marine fish farm. That is what I mean. Too many parties were enjoying, as a consequence of being of privileged status—that is, being Queen’s Counsel lawyers, being married to Queen’s Counsel lawyers, or seeing Queen’s Counsel lawyers on the side, but that is another matter—the ability to frustrate that development. I fear that if we are not vigilant, then some of the innovations that are being made here could also fall prey to similar excesses.

Having said that, we should back the industry, because how will we create the jobs for our mokopuna, for our children in New Zealand, unless from time to time, with a focus on primary produce, we back it? There will be elements in the industry who will be hōhā, as we say in the Ngāpuhi language, or exasperated, that they do not get everything they need, but the fishing and aquaculture industry cannot be driven exclusively for the benefit of the big end of town. This particular industry represents an opportunity for tangata whenua, and this is part of what has been fixed up in this bill. It was started in our time and has been refined by the current Minister and his officials. I say to the Minister that one day, hopefully very soon, he will be gone from that chair. It will be left to bureaucrats and to the future. I see a rising sun in the future, shining with powerful rays of wealth on the industry.

Hon DAMIEN O’CONNOR (Labour) Link to this

In the short time before the break I will make a speech supporting the Aquaculture Legislation Amendment Bill (No 3), as my good colleague Shane Jones has, but I will point out a couple of things.

I went down to look at a couple of Supplementary Order Papers that have been tabled by the Minister of Fisheries and Aquaculture. There are about six of them, and that is very much the nature of fisheries legislation, I have to say. Try as we might in this House to make good legislation, time and time again in fisheries and aquaculture we have made mistakes. Everyone in this House wants aquaculture to develop and move forward, and I commend the Minister for his attempts, but having to table in the Committee at the last minute another three Supplementary Order Papers and amendments would indicate that there are probably within the bill other mistakes. They will be exposed by the industry, no doubt in a court of law, as we move forward.

We want to see aquaculture grow. In fact all the indications internationally are that aquaculture is where we will get a large amount of fish protein to fill the growing world population. It will be through good aquaculture. We have some of the best science in the world, and we have some of the best water, but we have been hampered not by politicians necessarily, and not by bureaucrats, but by the industry. We have a quota management system that has allocated rights to individuals and companies to fish amounts of a set quota, laid down by the Minister, in the wild fish fishery. When aquaculture proposals come and impact on that area, we end up with some debates that have been lengthy and protracted. There have been some very sad outcomes for individuals through the long legal battles that we have seen, and in fact those battles have not finished.

There is one key Supplementary Order Paper. It is Supplementary Order Paper 265, and it is the Minister’s attempt to try to resolve the battlefield that has hampered aquaculture development, involving the rights of existing quota holders versus the intentions and wishes of those people who want to further develop aquaculture. I set aside the speculators. No way in the world do I want to support people who just want space to sell on—they can take a walk. But where there are people who genuinely want to put ropes in the water and develop new, innovative ways of growing aquaculture, we want to help them. This Supplementary Order Paper lays down a process whereby the holders of quota will have their rights upheld, but must accept some compromise to allow aquaculture to move forward. Without this compromise, and without the arbitration laid down in the Supplementary Order Paper, we could still be battling in the courts for another 10 years.

Dr ASHRAF CHOUDHARY (Labour) Link to this

It is my pleasure to speak on the Aquaculture Legislation Amendment Bill (No 3), which Labour supports. This legislation was really started by the Labour Government.

This whole issue of aquaculture has, in a way, bothered me, because although this country has done very well with animal farming—with dairy farming, sheep farming, and all that—we have not, so far, done as well in the aquaculture area. We have been saying that aquaculture is a billion-dollar industry and that we are hoping to achieve a billion-dollar export industry by 2025, but still, despite a lot of work going on in legislative terms, the industry has not really achieved the status that I would have liked to see it achieve years ago. Successive Governments have tried to improve aquaculture, but there have been difficulties not only with the legislation but also on the ground. We established aquaculture management areas, but they have not really worked. This bill will remove the requirement for aquaculture management areas, and I think that is a good move, but, having said that, there are a number of issues.

As we go through the Committee stage, we will note there are concerns for the industry. Clearly, one of those concerns is about the undue adverse effects test. My colleague Damien O’Connor has put forward an amendment to ensure that that part of the bill is improved. The industry has not been very happy with the process, if you like, and proposes that the legislation should require a collective action process for negotiating aquaculture agreements, and should provide flexibility. That is one of the areas that really has not worked in the aquaculture area as well as it has done in the meat and dairy cooperatives. The aquaculture industry has not come around to working together, and I hope that with this bill the Minister of Fisheries and Aquaculture will have achieved some balance. I commend him for achieving that balance, and I think he has done well in trying to get more flexibility going forward.

Of course, there are other issues, which will come up later, in terms of the power of the Minister. I think that some industry players, some recreational fishers, and some other people are saying that the bill gives the Minister a dictatorial power, but, overall, I think this bill will allow, and we are hoping it will allow, for additional aquaculture farming, which this country definitely needs going forward. We have not done well compared with Australia, for example. The Primary Production Committee went to South Australia a while ago and we looked at what the industry is doing there. It appears that, at least in South Australia, the industry does very well, but New Zealand has still not really made major strides in promoting aquaculture. I would call this bill a work in progress and, going forward, we need to continuously work on this area. I hope that with the passing of the bill we will have a much-improved aquaculture industry in New Zealand.

With those few words on Part 1, I think it is important for us to realise, once again, that the Minister has, overall, done a good job in bringing this bill to the House. We did quite a bit of work in the select committee, obviously, in terms of improving the bill. I thank the chair of the select committee, too. Thank you.

Hon RICK BARKER (Senior Whip—Labour) Link to this

I raise a point of order, Mr Chairperson. Could I just have a point of clarification, please? Are these amendments—

Hon PHIL HEATLEY (Minister of Fisheries and Aquaculture) Link to this

This part makes changes to the Fisheries Act 1996, which is the principal statute governing the management of New Zealand’s fisheries resources. The impact of aquaculture on fishing is managed through the process known as the undue adverse effects—or UAE—test. The bill as reported back by the Primary Production Committee places emphasis on agreements being reached between aquaculture applicants and commercial fishing quota holders. However, the bill in its present form does not necessarily enable the best-value use of the coastal marine area between commercial fishing and aquaculture. If a proposed aquaculture activity will have an undue adverse effect on commercial fishing, the aquaculture activity can proceed only with the consent of quota holders, even if the proposed marine farm would deliver much greater returns. Supplementary Order Paper 265 therefore proposes further changes to provide for a better balance between the interests of wild catch commercial fishing and those of aquaculture. The principal amendment is to clause 46, to insert new sections 186ZN to 186ZR into the Fisheries Act 1996. This is about better balancing the interests of commercial fishing quota holders with those of marine farmers.

The existing Fisheries Act 1996 protections for non-quota management stocks and for customary and recreational fishing remain unchanged. The changes introduced by the Supplementary Order Paper will, firstly, provide that independent arbitration may be sought if agreement cannot be reached; secondly, require the independent arbiter to determine whether the aquaculture activity has materially more value to New Zealand than the commercial fishing in that space; and, thirdly, provide for a methodology to be established in regulations to determine the value of the proposed aquaculture activity, the affected commercial fishing, and the compensation payable.

In addition to the amendments I have already indicated, I have tabled an additional minor technical amendment to Supplementary Order Paper 277.

Hon SHANE JONES (Labour) Link to this

This has been one of the most confounding aspects of this reform: how to strike the balance in terms of the undue adverse effects test between quota owners who obviously need considerable access to parts of the ocean to harvest their fish, and those who want to exploit that portion of the coastal environment to grow something arguably of greater value than the scattered number of trevally, snapper, blue cod, or whatever the case might be.

One of the most egregious examples of where aquaculture development has been held hostage can be found in the Tasman area. This reform and this set of changes arguably crimp or narrow—certainly deflate—the expectations of quota owners, and potentially narrow the application of what their quota rights actually entitle them to. The very important point that is made here is that all the industry will not agree with this, but there will be an opportunity for those who are quota holders, quota owners, etc. to enjoy a level of compensation. One hopes, however, that that compensation will not be excessive, because at the end of the day what I think has been correctly captured in this small portion of the reform is that having a quota to fish is having an entitlement to extract something from the ocean. It is not having an entitlement to an excusive level of possession to parts of the ocean. That might happen where a tai-ā-pure or a Māori mātaitai seafood reserve is created, or, indeed, a new fish farm, which is an idea that has taken a long time to materialise, unfortunately, but is a great idea. So we will be supporting this portion of the Aquaculture Legislation Amendment Bill (No 3).

I make reference to the fact that there are some liberal references in Part 2 to the High Court. It is obvious that in the tradition of fisheries politics, the fishing industry, and the application of regulation to the fishing industry, much of what we are currently talking about will wend its way, unfortunately, to the High Court, because it is a very litigious area. But the main point of why we are very keen to support it is that it is finally going to give a process that recognises the rights of quota owners, but to a point, and it does not inhibit the expansion of marine farming and aquaculture, which arguably is going to generate for “New Zealand Inc.” a greater return. For those reasons, Part 2 is supported by members on this side of the Chamber.

Dr ASHRAF CHOUDHARY (Labour) Link to this

I will take a brief call on the Aquaculture Legislation Amendment Bill (No 3) just to say once again, as my colleague the Hon Shane Jones just said, that this bill received very emotional submissions from a number of submitters to the Primary Production Committee, particularly from recreational fishers and from customary fishers.

I think this bill is a balancing act in terms of trying to protect the quota holders as well as take into account the wishes and the concerns of recreational fishers and customary fishers. As has been said before, there is opportunity for those who feel aggrieved to take their case to the High Court. Since 2003 there have been only about 10 cases that have gone through this process over concerns about undue adverse effects. I think only two of those cases have been upheld.

With those few words, we support this change in the bill in terms of the undue adverse effect on the quota holders. Also at the same time we make a note of the fact that the other fishers are also concerned about this particular clause. Thank you.

Hon PHIL HEATLEY (Minister of Fisheries and Aquaculture) Link to this

Before I explain a little about this part I would like to thank the Iwi Leaders Group chaired by Matiu Rei for its input, and also the aquaculture iwi advisers: Justine Inns, Laws Lawson, and Keir Volkerling. Without their valuable input the Government would not be in the position today to propose such a strong amendment to the Aquaculture Legislation Amendment Bill (No 3).

The Government is committed to upholding the Māori commercial aquaculture claims settlement. The bill as introduced in November 2010 included provisions to ensure the Crown would be able to fulfil its obligations, but at that time I signalled those provisions might be revised later in the legislative process if engagement between the Crown and iwi identified a better mechanism for delivering the settlement. That team found that mechanism.

The new provisions introduced by Supplementary Order Paper are the outcome of a process of engagement and consultation over several months. The proposed mechanism is the best possible compromise between the preferences of iwi and those of the Crown. That mechanism will enable the settlement to be delivered through regional agreements in a way that best fits iwi aspirations and preferences, region by region—a one-size-fits-all approach is not appropriate. The new provisions provide the flexibility for regional agreements to deliver on the Crown’s commitment as new space becomes available for marine farming over time.

The new mechanism recognises iwi’s likely preference for space but provides flexibility for cash or other deliverables to form all or part of the settlement package by agreement between the Crown and iwi or where the provision of the space is not practical. The proposal is common sense. It is an approach that recognises the interests of iwi in a regional way and the Crown’s interest in removing uncertainty for mainstream marine farmers. Iwi, the wider aquaculture industry, and the country as a whole all stand to benefit from iwi participation. If iwi do well, if Shane Jones does well, then we all do well. In addition to the amendments I have already indicated, I have tabled an additional minor technical amendment to Supplementary Order Paper 277.

Hon SHANE JONES (Labour) Link to this

At least there is someone left in New Zealand who is prepared to use that not in the form of an epithet, anyhow.

Part 3 of the Aquaculture Legislation Amendment Bill (No 3) deals with our Māori entitlements. But I have to say that when we reform legislation that deals with Māori entitlements, it is a portentous development when an amendment is moved upon an amendment. I want the Minister in the chair, the Minister of Fisheries and Aquaculture, to shortly take a small call and remove his hands from his pants. There is a great Māori proverb about that, but for fear of lowering the tone of the Committee I will not go quite there.

Hon RICK BARKER (Labour) Link to this

I want to ask the Minister in the chair, the Minister of Fisheries and Aquaculture, a question. I would like to know from the Minister in respect of the Aquaculture Legislation Amendment Bill (No 3) how many amendments he has moved to which he has moved amendments. I think it is very important for us to have some figures. And how confident is the Minister that his amendments to the amendments do not require further amendments? We are in his hands on this. We would like to take the Minister on trust. We know he works very hard at this, but we would be very interested to know how many amendments the Minister has moved to amendments, whether we will have any amendments to the amendments to the amendments, and whether they are reliable.

Hon PHIL HEATLEY (Minister of Fisheries and Aquaculture) Link to this

This part of the Aquaculture Legislation Amendment Bill (No 3) is the part on which the Ministry of Fisheries team worked tirelessly with those in the industry, councils, Te Ohu Kaimoana, iwi across the country, and a large number of interested parties.

This part amends the Resource Management Act 1991 to streamline aquaculture planning and consenting. It simplifies aquaculture planning by removing the requirement for aquaculture management areas to be established before consent applications can be made. This will put aquaculture on the same footing as other coastal activities and will enable councils to plan for it in a similar way.

Part 4 provides for a new ministerial power to recommend making regulations that will enable the Government to help councils change their plans where change is needed and cannot be achieved through the existing mechanisms. This bill provides for a minimum consent term of 20 years, in most cases, to provide the industry with an incentive to invest. However, it is important to note that this is not a default. We want terms to be longer. I will be explicit: 20 years is a minimum, not a target. We would like it to be much higher—up to 35 years.

Achieving substantial growth in the aquaculture industry requires a shift to higher-value species, including finfish. The bill makes changes to Tasman and Waikato regional coastal plans to enable applications for consent to farm a wider range of species, including finfish. In Waikato it also allows applications to be made for small extensions to existing farms.

Changes are proposed to schedule 3 of the bill, which contains amendments to the Waikato Regional Coastal Plan to establish a 300-hectare marine farming zone off Coromandel. This 300-hectare zone presents a strategic opportunity to enable New Zealand’s marine farming industry to develop and achieve its goal of $1 billion in annual sales by 2025.

Hon SHANE JONES (Labour) Link to this

I apologise to the people of Whangarei who watched their member, the Hon Phil Heatley. We sought to improve his general presentation by warning him about his collar. He continued to keep his hand in his pants. I cannot comment on whether there is a connection in that regard. But it is important that I come back to the matters at hand.

We heard from Sandra Goudie about fish farming, etc., in the Coromandel. How many years has that member wandered around, destroying the roads and worsening the environment? In the final portion of her largely undistinguished career, a small—a tiny—part of the Hauraki Gulf is dedicated to fish farming, and we are meant to see that as some sort of super victory. If the Minister of Fisheries and Aquaculture was genuine in regard to fish farming up and down Aotearoa, as we say in Māori, there would not be a wahapū, a harbour, a bay, or a cove blocked. This is a very small zone, and unfortunately I fear, because Doug Kidd was involved in establishing the zone, that it could be located in the wrong area.

Having said that, we are prepared to be magnanimous and we are prepared to take into account the overarching interests of our nation and not focus on the member from that Coromandel - Tīkapa Moana area. In all seriousness, though, we wish her well in whatever mangrove tree she might strike in the future.

DAVID CLENDON (Green) Link to this

I will make a couple of brief comments on Part 4 of the Aquaculture Legislation Amendment Bill (No 3), particularly in respect of clause 66. The clause states that the regional council and Minister of Conservation will effectively keep their hands away from fisheries management in a generic sense, and that is entirely appropriate. However, it goes on to state: “a regional council and the Minister of Conservation may perform the functions specified in subsection (1)(d) to control aquaculture activities for the purpose of avoiding, remedying, or mitigating the effects of aquaculture activities on fishing and fisheries resources.” That brings to my mind a very significant question here: what capacity do our regional councils have to adequately fulfil their existing obligations, duties, and responsibilities? I would be very interested to hear from the Minister or any other member of a regional council in the country that has sufficient capacity, expertise, and knowledge to make considered and appropriate judgments about the likely effect of aquaculture activities on fishing and fisheries resources.

This has been an ongoing problem with the Resource Management Act since day one. Regional councils have not been fulfilling their existing obligations. Imposing new and complex obligation requirements on them will simply exacerbate that existing condition. I reflect momentarily on the Kaipara Harbour, where I have recently spent some time. The regional council there is under considerable pressure already to consider its baseline monitoring as a follow-on of the consents for the tidal energy project. We have yet to see a regional council in the last 20 years that has been able to employ sufficient scientific capacity to properly assess the condition and quality of its environment within that area of concern.