SPEECH NOTES: HON JOHN LUXTON
Sustainable Development of Ocean Resources
Our Oceans Conference
Te Papa, Wellington

13 October 1999
(check against delivery)

Ladies and Gentlemen, distinguished guests. It’s a pleasure to be speaking to you today on behalf of my colleague the Hon Simon Upton.

New Zealand’s Global Position

For New Zealand, as an island nation, the importance of our Oceans cannot be overstated. In global terms, New Zealand is not the tiny player it usually is on the world stage. Our Exclusive Economic Zone is the fourth largest in the world with an area of 4 million square kilometres. In fact it’s about 15 times the size of our landmass.

The ocean is one of the world’s few remaining untapped resources. Even though we stand on the threshold of a new millennium, there are still vast uncharted waters.

Under the United Nations Convention on the Law of the Sea (UNCLOS), New Zealand has until 2006 to establish the precise outer limits of the amount of ocean floor under its jurisdiction.

Establishing that boundary will protect our rights to the resources of the seabed and subsoil for generations to come. The potential size of our seabed is 6 million square kilometres, 25 times the size of New Zealand's landmass.

There's still a lot we don't know about the outer edge of the seabed. The seabed is the final frontier and it will be a voyage of discovery.

The project to define the Continental Shelf is currently being worked on by Land Information New Zealand (LINZ) and will involve marine survey work to provide further information for the claim. The work will provide a legal boundary for rights that New Zealand already has.

The extent of these rights will be defined by this project. New Zealand’s territory extends to the 12 mile limit and we currently exercise sovereign rights to the resources of the Exclusive Economic Zone and Continental Shelf. The issue now is to define the actual boundary where the continental shelf meets the deep ocean.

The project is very exciting and the potential benefits are huge. Once the outer limits are successfully established, the extent of our seabed resources will be clear and available for future generations to come.

New opportunities are waiting to be opened up. Mineral wealth is ripe for discovery, new fish species are waiting to be identified and other fascinating scientific finds are just around the corner.
It’s not surprising that the ocean is becoming a major focus for economies worldwide, and will be increasingly important in the 21st century.

But we need to ensure that we manage our vast resources carefully. Any development must be ecologically sustainable so that society can continue to gain benefits from our ocean resources without compromising them.

We cannot manage our resources in isolation. The way in which we manage one resource can often significantly affect another.

Today I want to focus on the lessons we can learn from the way in which New Zealand manages its fisheries.

New Zealand’s approach to fisheries management has meant that we are now considered world leaders in this area. Our approach has led to;

-sustainable fishing of target stocks ;
-a profitable and efficient commercial fishing sector;
-great recreational fishing;
-a genuine partnership with Maori as the Crown’s Treaty partner; and
-strong environmental legislation.

It is useful to look at what lies behind our success.

New Zealand's fisheries resources have not always been in such good shape. Back in 1977, the ocean around New Zealand really was a new frontier, in fact it was like the wild west. Cowboys in ships were racing around the ocean, fishing the heart out of many stocks and fish species were declining at an alarming rate.

It’s not an exaggeration to say that some parts of the fisheries were on the verge of collapse. When New Zealand’s Exclusive Economic Zone was gazetted in 1978, huge challenges lay ahead in the management of our resources so as to achieve long term sustainability.

New Zealand met that challenge by developing and introducing the Quota Management System (QMS).

The QMS limited the total take and provided quota owners with an on-going right to a share of the total catch in a given fishery. The introduction of a property rights system gave the quota holders more power over their own future, and, more importantly, changed their incentives.

Quota owners had a real reason to protect the fisheries resource, rather than take the ‘rape and pillage’ approach of the 70’s.

The result is that, over the past two decades, New Zealand has seen a healthy, profitable fishing industry flourish. Today the fishing industry is New Zealand’s fourth largest export earner, and this year is predicted to earn $1.3 billion in exports. It employs over 10,000 people and has a very bright future ahead.
Increased profits, in some instances, have been achieved by developing technology that provides a better end product. While catch limits have remained constant, the value of the product has continued to increase with the use of innovation. New Zealand’s fishing industry has gone from adopting a short-term maximum gain attitude to a long-term sustainable approach.

The marine environment is a precious and finite resource. When we use it, we should be looking to be as efficient as possible so we can generate maximum returns for our economy with the minimum of impact on the environment.

If New Zealand had not taken the approach it did with the introduction of the QMS, our fisheries resources could easily have gone the way of some fisheries in the Northern Hemisphere, which are now in an extremely delicate situation.

Instead, today New Zealand is acknowledged as a world leader in fisheries management.

That’s not to say all the big challenges have been met and we can rest on our laurels. As we head into the next century more challenges lie ahead.

Reasons For Success

I believe there are several reasons for our success that we need to bear in mind when making future decisions.

The first thing we have learned is that the Government can’t manage fisheries resources on it’s own. We need to involve the public and private sector and strengthen partnerships with Maori.

Our collaboration with people with an interest in the resource is central to its effective management. For this reason the Government has encouraged participation and partnership with those with an interest in managing our fisheries resources.

A good example of this kind of development is the recent release by the Prime Minister of the aquaculture marine industry’s comprehensive Environmental Code for Shellfish Farming.

The Government views this Code as an excellent example of future partnership, with the users taking their own steps to mitigate environmental effects, rather than being subject to government regulation.

We have done our best to promote this climate. The Government has established a framework which reflects its sustainability, Treaty and international obligations, and which gives fisheries rights holders greater responsibilities for managing their own activities.

This is a major move away from a centralised, prescriptive and control-oriented Government to one which has a light hand on the tiller and allows rights holders to steer their own course. This has been balanced by Government retaining overall responsibility.
Another success story is the Challenger Scallop Enhancement Company, the result of a co-operative approach between the Government and the industry, which represents a whole new approach to fisheries management.

This co-operation has seen a major turnaround, from the closure of the scallop beds in the 1980s to a harvest that this season promises to be the fourth best in the 40 year history of the fishery.

People Management

Another huge component of sound fisheries management, is managing people well. Fisheries management is not so much about managing the fish, it’s about managing the activities of those who catch the fish. The Government has recognised this and has thought carefully about ways it can influence peoples’ behaviour to get the required results.

Once again, the QMS is a good example, in that it gives people property rights and therefore a strong incentive to manage their property well on a long-term basis.

The Hoki fishery provides a good example of this. This is New Zealand’s largest fishery. The fishery has traditionally been carried out on the west coast of the South Island during the July to September spawning period. Most of this fish was caught by vessels heading and gutting the fish or with onboard surimi plants. Catch rates of up to 200 tonne per tow were not uncommon.

In recent years New Zealand companies have invested in vessels with onboard filleting lines designed especially for hoki. These vessels fish for hoki year-round away from the spawning ground and typically target smaller quantities of fish, usually in the range of 4 to 5 tonne per tow, to improve product quality.

Even though figures suggested that an increase could be sustained, last year the industry asked me not to raise the Total Allowable Commercial Catch for hoki so as to protect it’s long term sustainabilty.

Other Property Rights

Giving people control over their own outcomes through property rights is a powerful tool that the Government has used in managing other ocean resources.

Two of the most valuable resources discovered in New Zealand’s oceans are oil, and natural gas. In setting a framework for managing these resources, the Government has used another form of property right whereby companies tender for rights. Again this provides the right incentives for companies to manage the resource sustainably.
Minerals are becoming more and more significant, and countries will have to think carefully about managing this important resource.

For instance, around New Zealand alone mineral deposits include substantial deposits of phosphorus, alluvial gold, salt, silica aggregates and possibly more than $200 billion of long-term manganese nodule deposits.

Although these resources are not renewable, it is imperative that they be managed in such a way that their extraction doesn’t adversely impact upon the surrounding habitat.

Ecological Sustainability

One of the major challenges New Zealand has to sustainably manage the ocean’s eco-system. To do that, we need to understand much more about the inter-relationship between, the impact of fishing and other activities such as mining, shipping and pollution from land-based activities on the marine environment and aquatic ecosystems.

We have many resources and we cannot manage each in isolation.

Biodiversity is a major environmental challenge for society to get to grips with over the next millennium. Many of you will have had involvement in the development of New Zealand's draft biodiversity strategy, which will help halt its decline. Implementing this strategy over the next few years will be a major task for industry, environmental groups, communities, central and local government.

Every New Zealander has a role in preserving our biodiversity. We have already achieved some significant successes:

-The creation of marine reserves to restore unique marine environments;
-The restoration of many natural habitats on islands such as Tiritiri, Matangi and Motutapu; and
-Ratifying of the Convention on Biological Diversity in 1993 signalling our commitment to stemming world-wide biodiversity decline.

We must be very careful that we are not too slow to act. Certainly greater research is needed in the area of biodiversity, but we must recognise that marine management problems are not simply research or information problems.

New Zealand could spend our entire GDP on biodiversity, and still not know enough.

Integrated Public Sector Effort

There’s been a tendency for public sector organisations to take a narrow, sectoral approach to oceans management that has led to patch mentality rather than good policy.

Currently we have a variety of laws and agencies dealing with ocean management. We have at least 11 different agencies doing important work on aspects of ocean management.

As the Prime Minister announced yesterday, the Government is seeking to address the fragmentation of ocean governance in New Zealand.

Conclusion

Looking ahead, I believe Government’s role will be to continue setting the legal framework in the context of sustainability. We will continue to ensure that ocean management systems have integrity.

What we will not be doing is wading into private sector activities where the private sector is the expert.

Oceans offer huge potential for wealth generation for the new millennium. However, to harness these opportunities effectively, we have to face our environmental responsibilities.

We want to have innovative, internationally competitive marine industries, but this cannot happen at the expense of our treasured ocean environment.

The key challenge we face is how we implement development in an ecologically sustainable way.

We can only meet the challenges of tomorrow if we all work together. There must be strong collaboration, with absolute clarity about roles.

The private sector, rightly, will continue to be driven by the need for the highest possible economic returns, but it must be in the context of sustainable business practices.

To do this effectively, the National led Government recognises that ecological sustainability of the ocean is largely a people problem. We understand that when people have a stake in the ownership, they will take a more responsible approach. Future Governments must find ways of influencing people to achieve the desired outcomes.

We’ve come a long way in ocean management. Enormous opportunities and large challenges lie ahead. New Zealand has proved in the past that it can meet those challenges, and I am confident that we can meet them equally innovatively in the future.

Thank you.

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