289 - Fishing vs Finance | Scoins.net | DJS

289 - Fishing vs Finance


A friend on FB made passing comment that UK.gov will be arguing hard for fishing rights to be restored to pre-70s glory, as perceived through rose-tinted glass. My response at the time was that this is, surely, one of those things which will be abandoned in favour of some retained rights for the financial services sector. I propose to explore those ideas here, to see if I can make myself better informed.

Fishing and fisheries are 0.12% of the UK economy [1,2]. The fishing industry is defined here as:   (i) Fishing and aquaculture (the cultivation and capture of fish and shellfish) and (ii) Fish processing (the preparation and preservation of fish and shellfish). This does not include the fleet repair and maintenance industry, and quay services since it is not possible to isolate when these activities are undertaken for the benefit of fishing boats, rather than for boats engaged in other activities.

Something like a quarter of fish exports by value are shellfish to the EU. [2] The bulk of both fishing and processing occurs in Scotland, about half as much occurs in the Yorkshire/Humberside region and less than half of that in wherever is left. Landings, tonnage landed in the UK from UK boats, was at a million tonnes (I'm calling that 100%) in 1973, 40% of that in 2009 and still below 50% since then. The value of landings by UK vessels, a term including landings made elsewhere, has steadily climbed to pass £900 million.

Unearthed [5]

The investigation found:

  • The five largest quota-holders control more than a third of UK fishing quota
  • Four of the top five belong to families on the Sunday Times Rich List
  • The fifth is a Dutch multinational whose UK subsidiary – North Atlantic Fishing Company – controls around a quarter of England’s fishing quota
  • Around half of England’s quota is ultimately owned by Dutch, Icelandic, or Spanish interests
  • More than half (13) of the top 25 quota holders have directors, shareholders, or vessel partners who were convicted of offences in Scotland’s £63m “black fish” scam – a huge, sophisticated fraud that saw trawlermen and fish processors working together to evade quota limits and land 170,000 tonnes of undeclared herring and mackerel
  • One of the flagships of the “Brexit flotilla” – which sailed up the Thames in 2016 to demand the UK’s exit from the EU – is among the UK’s 10 biggest quota-holders
  • Around 29% of UK fishing quota is directly controlled by Rich List families. Some of these families have investments in dozens of other fishing companies, meaning companies holding 37% of UK quota are wholly or partly owned by these Rich List families.

Source [5] indicates that at some point we, the UK, had a fishing quota. This piece shows that mostly it has been sold off and/or is held by very few hands indeed. Which is entirely at odds with the perception that fishing as a business is filled with very small people each struggling to make a living. Perhaps both states are true? A single boat, the Voyager, but not as Star Trek, has some 55% of the Northern Ireland quota. How can this be so, and what are the consequences of such a position? Since this came to light in 2005, how is it that the larger perception of the wronged small business has persevered? Looking just at England, it seems that indirectly ("ultimately" in the words of [5]) half of all UK quota is held by foreigners - Dutch, Spanish and Icelandic, while close to a third resides with just three Rich List families. I wonder which came first, being rich or gaining the quota. So we reach a situation where the smaller inshore vessels that make up 77% of the fleet has/have ended up with “less than 4% of the quota”. Unbelievable.

This table, from the excellent [2], shows a trade deficit, imports exceed exports, of £M1400. At the same time we have a trade surplus with the EU, 71% out, 34% in. If you want to know where, look at the source [2], page 7. There is a 2017 report at [3] you might like to look at, which explains the UK approach. It would seem that the UK has a very flexible system: quotas can be in any of three positions;  for a sector, non-sector or inshore. It is easy to lease or even swap sector quotas on a temporary basis, though these quotas are held by the year. Inshore and non-sector quotas are far less movable, but are allocated on a monthly basis. A sector vessel belongs in some sense to a fleet, a 'producer organisation', who in some sense manage quota on behalf of their members. The policing of this was not something I attempted to investigate, though perhaps I should.

Relevant though, and still from [2], is that Michael Gove made sensible comment in 2017 that there has in effect been overfishing throughout the period of the Common Fisheries Policy. He also pointed out then that we, the UK, don't have the fleet to land the catch, which means that there must be some form of transfer of permissions as to who may fish where and land what. Maintaining access to where any particular boat of a fleet may fish may in itself be enough to preserve the status very much as it is now. Yet, when the numbers are taken into consideration, I wonder whether this is so. The energetic stance taken by the Tories with an 80-seat majority may well be tempted to strike for a position in which the English fleet is confined to English waters in return for no-one else being permitted to fish in those same waters. There are several factors arguing that this is pretty silly, since it will be very difficult to separate 'access to market' from 'access to water'. For example, the cod we like in the UK is found off the Norwegian coast, while the langoustine the southern Europeans like is found in English waters.

That is not to say that no change should occur. It is obvious to me that the small boats, under 12 metres in length, are unfairly excluded. But there are competing issues and, when it comes to politics, loudly driving one issue is a great way to sweep another under an available carpet. There are differences of opinion between England and Scotland, east and west, large and small boats, inshore and offshore (almost the same thing as boat size), large-scale and small-scale fishing. Fishing interests vie with processing interests and I foresee that this is something politicians will think to encourage, since about half of 'fishing' value is in processing—and many more voters—such that action that somehow looks to increase the size of the processing industry, whoever did the catching itself, looks an attractive proposition. It seems to me that the pressures on the small-scale fisherman will be a lot worse before it improves — by which time it will be far too late.

The comparison issue is the financial sector, with something like 6.9% of GDP, but largely centred upon London [7]. Compare this £bn132 value with £bn1.4 in fishing, and the 1100 thousands employed in finance with the 24 in fishing. That's fishing at 1% of the 7% GDP of finance and 2% of the employment. Any argument that says one is in any sense more important than this because of the effects of the foreign competition and foreign markets has these two hurdles to jump; to argue that sector fishing is very important affects very few employees, very few Brits and surprisingly large amounts of money value. But the similar numbers for the finance sector are always very much larger, fifty to a hundred times so. So why does anyone even think fishing will get even the briefest of inclusions? The comparison doesn't stand up. The ways in which the two sectors are affected by overseas business is not entirely dissimilar, but the trade in London, even as diminished by Brexit, is still two orders of magnitude larger. That suggests to me that the lobbying is fierce and effective, but in the end no politician is going to do much but look for ways to appease. Appease fishing, that is. Even within Scotland, where half the fishing business is, there are 84,000 finance jobs, vs the 12,500 in fishing and fish processing. In Yorks and Humberside there is a similar position, 75,000 vs 6,500. In the South West,  79,000 vs 1,750. I am sorry for the fisheries cause, but every politician is going to seek a 'third way', to steal from Tony Blair. What I would expect is that funds be found to expand or support the expansion of processing, with the intention of wooing boats fishing locally (of whatever nationality) to bring their catches here for processing. I see development of inshore fishing as being desirous, ¹ along with preservation of stocks, so that fish farming [8] becomes ever more attractive, however done.

Short form conclusion:  the fishing sector is virtually irrelevant, given that finance is a hundred times bigger.

DJS 20200215

top pic from here, showing the UK's fishing area.

 What I expect the political solution to be is that the many small fishing vessels that operate inshore will have their position changed such that inshore fishing is perceived to be entirely local and British and regulated only by (a possibly changed concept of) quota. Thus the public perception is that the many unfairly treated (that's the message received) are better treated, while where the money is, the big sector and off-shore stuff, remains as is, with European access. That meets both the needs of the many and the (greedy?) needs of the few, which strikes me as what a politician would call win-win.

[1]  https://www.theguardian.com/commentisfree/2019/aug/31/myth-brexit-bonanza-uk-fishing-exposed-no-deal

[2]  researchbriefings.files.parliament.uk › documents › CDP-2017-0256    https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=10&ved=2ahUKEwjwoNeKo9HnAhXyuXEKHfknD-gQFjAJegQIBBAB&url=http%3A%2F%2Fresearchbriefings.files.parliament.uk%2Fdocuments%2FCDP-2017-0256%2FCDP-2017-0256.pdf&usg=AOvVaw2FaajUdGFJJBDArqqoUEdq   a useful list of press articles lies at the end of that document.

[3]  https://neweconomics.org/2017/03/who-gets-to-fish leading to  https://neweconomics.org/uploads/images/2017/04/1513-NEF-English-Executive-Summary-Report.pdf

[4]  https://en.wikipedia.org/wiki/Individual_fishing_quota      



[5]  https://unearthed.greenpeace.org/2018/10/11/fishing-quota-uk-defra-michael-gove/

[6]  https://www.ft.com/content/cdf8af0a-40fd-11ea-bdb5-169ba7be433d   


[7]  https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=14&ved=2ahUKEwjayOz8sdHnAhWIh1wKHenqBqYQFjANegQIBBAB&url=https%3A%2F%2Fresearchbriefings.files.parliament.uk%2Fdocuments%2FSN06193%2FSN06193.pdf&usg=AOvVaw1F0lkxZd7TjCcQoTpCi-PJ

[8]  https://en.wikipedia.org/wiki/Fish_farming  You might also read up on cage system fish farming, hydroponics with fish, algal blooms, anti-fouling etc etc. All good material worth knowing a little about. Essay or research on why it is that salmon farming affects the wild population so drastically — one would think them separate populations. That they are not so separated seems to be the central problem. Not least, the weaknesses (diseases, etc) of the farmed fish are what is passed on to the wild ones. With devastating effect on the wild populations.

[9]  , showing the UK

Edit 20201018. I have written to a couple of people who better understand the finance world than me, asking the to comment on a  piece I found yesterday in the weekend Times. These paragraphs have been taken whole from the mail that resulted, though as yet I don't have response to paste:

I read today (Times, Philip Aldrick) here, here and here.  that they [the financial sector issues of Brexit] have indeed been resolved, but not in the way I had anticipated. I missed an important move and feel pretty silly for missing it. If matters are indeed as I understand them today, then at some point earlier in the year— in the fine print about equivalence in executing Brexit—the EU has managed to move all of the external financial business we do off our desks and onto theirs by declaring what is and is not 'equivalent'. That is, as I'm understanding it, at least 25% of what the financial market does disappears from London.  Aldrick calls this a land grab; I think he is right. He also calls it a done deal and if that too is right, I think we've been roundly had. Had as an electorate by failing to notice, I think.

At some point in negotiations that are going to fail the cost of not doing a deal is more attractive than the cost of the deal being offered. That seems fairly obvious; before the point where it looks like things might fail, one would have had a look at the cost of this occurring, and surely one would repeat this with increasing care as the brink approached, as it informs your own actions. Those of us that voted Remain saw this general imbalance and wanted the status quo, with argument for reform of the EU from inside. The vote went the other way (which makes the previous irrelevant) and so we must make the best of what we have. We have no control over where the EU puts its business and there is every reason from their perspective to keep for themselves what they view as theirs. I quite agree with them. Taking with them a load of other business is a different play, but also understandable; if you can steal some of the business, well done. It looks to me as if we've been beaten up by the bigger kid in the playground. And that we've simply rolled over.

Which explains to an extent why, in press releases, fisheries is still apparently to be sorted out. That is fundamentally silly, being trivial in comparative size to finance – and where the fix needs to be on the small boats, not what the press refers to, the big area fishing (deep water sector). But that is a political move that we should be seeing through immediately.


But if you're in fishing, then it looks, right now, as if something (no idea what) might be recovered – that something we lost ('sold') 45 years ago might in part be repaired. Looking at only fishing, the UK does in some sense 'own' a lot of sea bed that we had to yield on joining the EU. Now we're not in the club, that reverts to being ours and that agreement is no longer relevant. So we need a new agreement; unless we trade that position in whole or part for something else that we want. Want more; enough to be open to the trade. Looking at this from a French perspective, the prospect of angry fisherfolk in France is a far worse prospect than the equivalent people in Britain (who have had a working lifetime to get used to their position). It is change that causes the ructions, when it disagrees with 'what I want'; the French are very good at the protest part of that.


While we have been distracted, we've given away a lot more of the whole ball game. Or Aldrick is largely wrong.  Can you have a read, please, and tell me which way you read the same content?

It seems to me that walking away from conversations with the EU is, politically, now mostly the right thing to do. I don't like it, but the cost of agreeing with their position might well be bigger than the cost of having no deal at all. Such a position is predicated upon understanding where we have reached.


20201231 edit. Not explicitly mentioned here—and be aware that by this date the Brexit issue is 'done'—is that the financial sector has been largely sold out by something slickly called equivalence. Whatever this is (or turns out to b , since it is difficult to find any precision of description), the end result is that those financiers that operate globally don't much care where they are based and they'll follow the money. I see the end result as being that the London financial sector will diminish over the next five years and much of that business will move onto the continent.So, while fishing is already screaming that they have been sold down the river or other metaphors, the financial sector is relatively quiet, but I think that, by and large, they are relatively easily moved (swanky offices and extreme communications are required), so unless there is a twist such as money laundering [313], I think we will discover it has gone only after the event.

What bothers me about this is that the UK has been seen to have made a success of this sector. Therefore the EU surely wants as much of that action as it can have, so I wonder what, if any, terms of agreement on equivalence will be permitted to serve UK interests; it seems to me to be obvious that Europe wants this business. Therefore I expect agreement on equivalence to be slow and to be biased against UK interests. It will be called making the playing field more level, but what that means is making the share of the financial market more evenly distributed across Europe, to  the UK's loss.

Reading on this: 

https://commonslibrary.parliament.uk/equivalence-with-the-eu-on-financial-services/  explains what the issues are and shows just how very vague the position is at the end of 2020.

https://www.instituteforgovernment.org.uk/explainers/future-relationship-equivalence very similar content, but dated Feb 2020.

https://ukandeu.ac.uk/what-does-the-brexit-trade-deal-mean-for-financial-services/ 20201227 The UK-EU Trade and Cooperation Agreement (TCA) is typical of free trade agreements and does little to facilitate access to the EU’s single market for UK financial services from 1 January 2021. In a document stretching to over 1200 pages, ‘financial services’ appears six times (‘fish’ appears sixteen).  

https://www.economist.com/britain/2020/10/24/what-brexit-will-do-to-the-city-of-london?gclsrc=aw.ds&gclid=CjwKCAiAirb_BRBNEiwALHlnD7GsI_1rhf9NUQMj8d9d3BvZUwCUECEgxiVgoKHVRgdUUFRJyewemRoC-poQAvD_BwE&gclsrc=aw.ds   If you can access The Economist; I cannot.

Edit 20210119 post Brexit, with the Deal in place. From a BBC report, well worth reading in full:

  • EU boats will continue to fish in UK waters for some years to come
  • But UK fishing boats will get a greater share of the fish from UK waters
  • That shift in the share will be phased in between 2021 and 2026, with most of the quota transferred in 2021
  • After that, there'll be annual negotiations to decide how the catch is shared out between the UK and EU
  • The UK would have the right to completely exclude EU boats after 2026
  • But the EU could respond with taxes on exports of British fish to the EU or by denying UK boats access to EU waters

I find it hard to care. The media has consistently presented the industry as overwhelmingly pro-Brexit and continues to do so; the fishing lobby was loud and persistent; here we are and somehow they feel let down, betrayed even. Reading.

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