An old fishing boat decays on the Wyre estuary near Fleetwood dock. Fleetwood, in Lancashire, was once one of the UK's most important fishing ports. Photos by Steve Morgan for Unearthed

Privatising the seas: how the UK turned fishing rights into a commodity

The decline of British fishing drove coastal support for leaving the EU, but many of the industry’s problems have an origin closer to home

An old fishing boat decays on the Wyre estuary near Fleetwood dock. Fleetwood, in Lancashire, was once one of the UK's most important fishing ports. Photos by Steve Morgan for Unearthed

Privatising the seas: how the UK turned fishing rights into a commodity

The decline of British fishing drove coastal support for leaving the EU, but many of the industry’s problems have an origin closer to home

An old fishing boat decays on the Wyre estuary near Fleetwood dock. Fleetwood, in Lancashire, was once one of the UK's most important fishing ports. Photos by Steve Morgan for Unearthed

Around 20 years ago, fishermen in Fleetwood, Lancashire, managed to make national news by inviting several dozen Spanish trawlers to join their cooperative.

This “unprecedented marriage of convenience” provoked fury from other British fishermen, according to reports at the time. The spokesman for one of Fleetwood’s south-western counterparts told the BBC they were “very angry that Fleetwood could abandon principles it has had for so many years”.

The Spanish vessel owners in question were (and still are) known as “quota hoppers” – fishermen from other countries who had bought British boats and licences to gain access to the UK’s fishing quota.

Quota hoppers have long been a source of deep resentment for British fishermen. They are held up as evidence for the widely-held view that European Union membership has been a raw deal for the UK’s fishing industry, and the origin of its decline. Their presence on the UK fishing register has been controversial from the eighties to the present day, and was one driver of the huge support for Brexit in coastal towns.

In England and Wales particularly, overseas owners have bought up vast swathes of fishing rights. An Unearthed investigation last autumn found that around half of England’s quota is held on Dutch, Spanish, or Icelandic-owned “flagships”, so called because they sail under a British flag. One Dutch multinational alone controls around a quarter of English quota. By comparison, the UK’s small scale, “inshore” vessels must fish from a pool of quota amounting to less than 2%, despite making up around 79% of the UK fishing fleet.

But in truth, the decline of the British fishing industry began some years before the EU’s common fisheries policy (CFP) took effect. And the quota hoppers are better understood as a symptom of a larger problem: decades of mismanagement by UK governments, which have seen fishing rights first commodified and then consolidated in the hands of a small and wealthy elite.

It’s a story that is tied up with that of Fleetwood, and of the Fleetwood Fish Producer Association’s deal with the “Spanish Armada”.

Cod wars

At the time the UK began talks on accession to the European Economic Community, around 1970, the most profitable part of the fishing industry was the “distant water fleet”.

These were huge trawlers sailing out of Fleetwood, Hull and Grimsby to chase cod and haddock in the rich fishing grounds around Iceland and beyond.

This industry made Fleetwood one of the biggest fishing ports in the country, and its docks a major employer. “When the industry was at its peak, there was all the support industries, nobody was out of work,” says Fleetwood fish merchant Chris Neve, 70. “Whether you worked for the engineers, net makers, winch makers, trawler supply – there was just loads of work, all paid for by the fish.” Neve began selling fish from the back of a van, aged 19, and built a business that at its height employed more than 80 people, with investments in several trawlers.

Retrain our own fishermen – that’s what we’re supposed to do. But they sacked them. Put them all on the bloody dole

In 1970, it was still more than a decade before a UN convention gave coastal states control over all fishing within 200 miles of their shores. Back then UK governments supported the distant water fleet by promoting a principle of “open seas” – basically fishing where you wanted.

But Iceland had begun to assert control over its waters, in a series of confrontations between trawlers and gunboats known as the “cod wars”.

The final “cod war” came in the mid-seventies, when Iceland asserted and won, a 200-mile exclusive zone.

Tom Watson, 76, was a skipper in Fleetwood’s distant water fleet at that time. After the British vessels were kicked out of Icelandic waters, he says, the ships were tied up and the trawler companies held out for decommissioning payments from the government. “The trawler owners claimed there was nowhere for these ships to go, and they got a lot of compensation.” A lot of fishermen lost their jobs, and went to work on standby vessels for the oil and gas industry.

But by this point the UK had joined the EEC, and preparations had begun for the Common Fisheries Policy (CFP), which came into force in 1983.

Tom Watson was a skipper in Fleetwood's distant water fleet

Under the CFP, all EU fishing grounds are managed as a “common pond”. Each country’s quota – its share of the fish that can be caught – is based on its “historic track record,” which in practice means the catches its fleet recorded in the mid- to late-seventies.

According to Watson, that period saw a huge influx of Belgian and Dutch ‘beam trawlers’ catching sole in the Irish Sea, building up their nations’ track record on Fleetwood’s doorstep. But, he says, neither the government nor the trawler companies encouraged Fleetwood’s distant water fishermen to follow suit. “When we came back in [from Iceland], it should have been recognised that, hold on a minute, all this area here is rich fishing ground. Retrain our own fishermen – that’s what we’re supposed to do. [But they] sacked them. Put them all on the bloody dole, so they all went working on the oil standby vessels.”

Market forces

Once a state is allocated its share of quotas under the CFP, it has a lot of freedom in how it distributes them.

The UK has always operated a two-tier system. A portion of the quota is held in a “pool” for collective use. The vessels that fish from this pool include nearly all of the small boats that fish in inshore waters, and a group of larger trawlers known as the “non-sector”. But, from the early days of the CFP, the larger – over-10m – trawlers had another option: if they joined a producer organisation (PO), a kind of mutual society for fishing vessels, they could take their share of quota out of the pool to be managed by the PO. These vessels are known as “the sector”.

The way this system was run in the 1980s and 90s saw “the pool” stripped of all but a tiny fraction of its quota, while the fishing rights managed in “the sector” were transformed into a tradable commodity.

Here’s how that happened.

Until the late 1990s, quota allocations were based on a vessel’s “track record” – an average of its catches in previous years. The system worked against efforts to curb overfishing by encouraging a “race to fish” – trawlers would cast their nets even when prices were too low to make a profit, just to maintain their track record. It also encouraged “ghost fishing” – skippers reporting larger catches than they actually landed, to bump up their quota. As more and more trawlers joined POs, taking their (sometimes inflated) track records with them, the “pool” of quota managed by the state dwindled dramatically.

When licences were made transferable, they were made tradable. From then, economics have had their full flow

Meanwhile, successive UK governments took decisions that encouraged and then liberalised trade in fishing rights. From the mid-80s, the UK restricted the issue of new fishing licences, so the only way to get one was to buy it from a fisherman. In these early days, this often meant buying a licence along with the trawler and its track record. But in the early 90s – against the wishes of the main fishermen’s organisations – the government formalised the right of “sector” fishermen to move licences and track records between vessels, opening up a new kind of trade in quota. Detaching track record from vessels in this way ensured quota taken out of the pool would never come back to it.

This was followed by other deregulatory moves, like the liberalisation of quota “swaps” between POs. In 1999, the UK replaced track records with “fixed quota allocations”, which give the holder an unchanging share of the UK’s quota. These were dished out to vessels in the sector based on their catches in the mid-nineties. This change discouraged the “race to fish”, but also made quota easier to swap, sell or lease to others.

‘Highland clearances’

In the same year, the House of Commons agriculture committee held an inquiry on sea fishing. The most powerful voices in the industry lined up to decry the way the quota market had developed, and to warn against continuing further down this path.

Barry Deas, then and now chief executive of the National Federation of Fishing Organisations, told MPs the problems had started at the point licences were made transferable. His federation had opposed this move and called instead for a licencing board to be created, which could use licencing for socially valuable purposes like creating opportunities for young fishermen. “When licences were made transferable, they were made tradable,” he said. “From then, economics have had their full flow.”

Each of these reforms had “made sense on their own terms”, he added. But they added up to a “step-by-step movement towards trading in quotas”; fishermen “whilst they engage in it, regret this movement” because it “closes the door, very much, to young fishermen joining the industry”.

The problem with ownership and trading of quota was not simply the incursion of foreign quota hoppers, explained John Goodlad, representing the Scottish Fishermen’s Federation. It would also “inevitably concentrate the ownership of fish quotas and therefore vessels in fewer and fewer hands”.

Already by that point, warned the Anglo-North Irish Fish Producers Organisation, the value of track records had “increased to such a degree that most individual fishermen find it impossible to compete with those that have the financial clout of large companies behind them”.

But it was Iain MacSween of the Scottish Fishermen’s Organisation – now one of the biggest producer organisations in Europe – who put the warning most vividly. In Iceland, he told MPs, privatised fishing rights had left “those who own the property rights… sitting in Florida and leasing them out to other people to go and catch.” Going further down this road in the UK would lead to smaller coastal communities having their fishing rights purchased away by wealthier ports.

“It seems to me,” he concluded, “without being overly dramatic about it, that the confirmation of property rights in the fishing industry will do for coastal communities what highland clearances did for the agricultural sector.”

Fishing pressure

The growth in unregulated trade in licences and track record further encouraged the influx of “quota hoppers” from Spain and the Netherlands. According to the Tory peer Baroness Trumpington, by mid-1996 there were around 150 quota hoppers on the UK register. Around 40 of those vessels had joined before CFP quotas took effect. The rest had bought their way in since.

The Dutchmen were buying it, and the Spaniards… And the guy would look at them thinking, ‘Well, I’m not getting any help from the British government. All they’re doing is persecuting me. I’ll sell up and get out.’

The then-SFO chief executive Iain MacSween told the sea fishing inquiry in 1999 that “very considerable quantities of what were once UK quotas have been bought particularly by the Dutch”. He noted that virtually every licence sold in the previous year and a half for “pelagic” midwater fish like mackerel and herring had “ended up in the ownership of the Netherlands freezer trawler fleet”.

But quota hoppers were far from the only strain on the British fishing industry in the nineties. Overfishing was endemic, with the scale and capacity of industrial fleets wildly out of proportion with the amount of fish that could sustainably be harvested. Quotas were routinely set higher than scientific advice. The trade in “black fish” – illegally landed, over-quota fish – was rife.

In an effort to reduce the “fishing pressure” on stocks, the EU sponsored repeated rounds of decommissioning, with fishermen offered cash incentives to give up licences and remove their vessels from the fleet. The UK ran three rounds of decommissioning in the nineties, and towards the end of the decade began making efforts to clamp down on black landings.

But the way these interventions were pursued – according to fishermen at the time – drove up demand for quota, and galvanised the trade in quota and licences. As well as quota hoppers, domestic speculators moved into the new business of quota trading.

Tiger’s Tail

According to Tom Watson, the Fleetwood PO still had a significant quota at that time, although he says some of it was lost through poor management. But as the market developed it began to be sold away from the town.

“People were being allocated a quota that became a commodity,” he says. “And they’d never had that before.”

“You even [had] big companies that were buying up bits of quota all over the place and amassing the quota into one place. The Dutchmen were buying it, and the Spaniards.

“They were coming in and offering twice the value of the quota. And the guy [who held the quota] would look at them thinking, ‘Well, I’m not getting any help from the British government. All they’re doing is persecuting me. I’ll sell up and get out.’”

Between this and decommissioning, Fleetwood PO saw its fleet rapidly decline. According to a memo it sent to the sea fishing inquiry, between 1992 and 1997 the organisation’s membership dropped from 48 vessels to just 29. Another round of decommissioning “again hit us hard”, with more vessels having their bids for decommissioning money accepted. “The government’s decision to allow the owners of decommissioned vessels to sell their quota/track record on the open market to the highest bidders added to the ‘Gold Rush’,” it added. The PO decided to try to buy up the quota from these decommissioned vessels, but it wound up deeply in debt.

We soldiered on for two or three years after that, but you couldn’t get crews because the boats couldn’t earn enough money

Around this time fish merchant Chris Neve joined the PO. “Fleetwood PO was basically bankrupt,” he says, “and they wanted Wyre borough council to lend them money to buy quota.” As a condition of the loan, the council wanted a local businessman involved in running the PO. By this time he had investments in several Fleetwood trawlers anyway, so he agreed.

Amid these debts, Fleetwood heard the Spanish trawler owners were looking to join a PO. “None of the POs in the UK would let the Anglo-Spaniards join,” says Neve. “People were quite happy to sell them boats and licences, but they were stuck in the non-sector where they couldn’t trade quota.” The Spanish offered Fleetwood a deal: they would clear its debts, pay a joining fee, and pay annual dues of £57,600. This, according to Neve, “put us on a fairly stable footing financially, meant we could buy more quota for the [Fleetwood] boats”. There was also a hope that the Galician vessels would land some catches in Fleetwood, revitalising the dockside businesses.

For a while this happened, says Chris. Spanish boats landed in Fleetwood and created some work – taking on fuel and ice. But that came to an end after a couple of years, when a Spanish flagship called the Erimo ran aground on Tiger’s Tail, a notorious sandbank at the entrance to the dock channel. The crew abandoned ship without securing the doors, and when the tide went out her back end slipped into the channel. “Water just flooded into her and eventually she slid off the bank, blocked the channel totally.”

Neve was left trying to find something to do with the mostly West African crew. “The trouble was,” he says, “none of them had any papers. They’d abandoned ship, so if they did have any papers they’d left them on board”. He had them put up in a hotel for a bit, then managed to get them over to a fisherman in Northern Ireland who needed deckhands, but he sent them back a week later when he found they had no papers. For a while they were in the Fishermen’s Mission. “They all finished up in Walton Gaol for Christmas,” says Neve. “That was the last I heard of them.” The Erimo languished in the dock channel for months.

“After that no Spaniards ever came back,” he adds. “They all thought fuck that for a laugh.”

Meanwhile, scientists were warning that cod stocks in the Irish Sea had dropped so low they were in danger of collapse. The European Commission introduced drastic measures, including a ban on cod fishing in some parts of the sea. The cod recovery plan had little impact on the Spanish flagships, which were targeting hake and other species. But it was the “death knell for the Fleetwood trawlers,” according to Chris. “The boats weren’t viable after that. It was a big part of their earnings.

“We soldiered on for two or three years after that, but you couldn’t get crews because the boats couldn’t earn enough money.”

Fleetwood fish merchant Chris Neve fillets a hake at his industrial unit near the dock
Fleetwood dock

There are hardly any fishing boats left in Fleetwood harbour now. Chris sold his business about ten years ago to a London-based company, before starting up again on a smaller scale. There is still a strong base of fish merchants and processors like him working on and around the dock, but most of their fish now arrives overland from Scotland or the South West. The PO’s membership dropped away until it was basically just the Spanish flagships left.

Last year they took their quota and merged the remnants of Fleetwood PO with the Anglo-North Irish FPO, on the other side of the Irish Sea. There is little evidence left of them in England besides their entries on the quota register and a couple of dozen brass-plate companies registered to a cottage in Surrey.

The fishing rich list

The fishermen’s warnings to the sea fishing inquiry proved accurate.

Over time, in the name of efficient management, the UK continued incrementally to commodify its fishing rights, and to lubricate the market in those rights. Entitlements that were originally handed out for nothing can now be leased and traded for millions of pounds.

In essence, fisheries have been accidentally privatised

This process has seen fishing rights stripped from many small coastal communities and consolidated in a handful of large and lucrative fishing companies.

An Unearthed investigation published last autumn found that well over a quarter of the UK’s fishing quota – 29% – was in the hands of just five families on the Sunday Times Rich List. The reach of this tiny domestic elite dwarfs the holdings of the many quota hoppers, who in total hold 13% of UK quota. Overall, more than two thirds of the UK’s fishing quota is now in the hands of just 25 companies. And despite politicians’ hopes that quota ownership would engender “responsibility for the future of the stocks”, more than half of those businesses have directors, shareholders or vessel partners convicted (in 2011-2012) of black landings in the biggest organised overfishing scam ever to reach the British courts. In Northern Ireland, more than half the country’s quota is hoarded onto a single trawler.

One of the groups that has been most ill-served by the UK’s management of fishing rights has been its small-scale, inshore fishermen. This group – which fishes the UK’s inshore waters in vessels less than 10m long – comprises more than three quarters of the UK’s fishing fleet and provides around half of the jobs in the catching sector. However, it has access to a tiny fraction of the quota: less than 2%, according to the New Economics Foundation. For many years in the early days of the CFP, UK fisheries managers kept little record of the amount of fish landed by the “under tens” – these boats were not allowed to create and hold track record, or, originally, to join producer organisations. Then, as now, they fished from the national “pool” of quota.

But the pool was stripped of almost all quota in the first decades of the CFP. In response, the government in the mid-nineties “underpinned” some quotas for the under 10s, guaranteeing them a certain minimum tonnage, or percentage of the quota. But these underpinnings were not strong. When regulators began to keep closer track of the under 10s’ catches and enforce quota limits, many found their quotas were too low to make a living. Small scale fishers say they have now been forced either to rent quota at exorbitant prices, or to switch over to non-quota species like shellfish to survive.

Brexit dividend

The fishermen’s organisations that once warned against the market in quota have become its enablers and protectors.

As Brexit looms, and with it the need to write fishing laws to replace the CFP, these organisations have come out forcefully against any redistribution of the UK’s fishing rights. Giving evidence once more to parliament in 2018, Barry Deas – still NFFO chief exec nearly 20 years later – told MPs that any post-Brexit gains for young fishermen or the inshore fleet would have to come from new quota, which the government hopes to win from other member states in the Brexit negotiations.

The distribution of existing UK fishing rights, he said, should “remain the same” in recognition of “case law in the English courts”, and “the stewardship that comes along with rights of tenure”. The Scottish Fishermen’s Organisation – whose former chief exec warned of ‘Highland clearances’ in the fishing industry – agreed. In a statement to Unearthed in late 2018, the SFO said keeping the existing quota distribution would recognise “the investments made by fishermen and fishing businesses over the past 20 years, and as such helps to maintain business stability within a period of great political uncertainty”.

In the UK, the system of producer organisations has been strangely distorted by their role in the quota market. Fish producer organisations were conceived as democratic collectives of fishermen who came together to strengthen their bargaining power and collectively manage their fishing. But the UK has, for example, allowed four of the biggest quota-holders to form their own “in-house” producer organisations – essentially collectives with only one member. This, in effect, short-circuits the system and allows private companies to directly hold, manage swap and lease quota domestically and internationally.

At the back end of 2018, the European Commission took the second step in infringement proceedings against the UK over its management of producer organisations. The UK system, it warned, “undermines the principle of democratic functioning of producer organisations across the EU and may also jeopardise their capacity to enforce rules on their members”. (It is not clear whether the EC proceedings refer to concerns about in-house producers, or some other aspect of the UK system.)

Over the decades, British fishermen have developed a deep frustration with the CFP, which in turn has driven huge support for Brexit among coastal communities. While this frustration has often had good reason, the use of the CFP as catch-all scapegoat has also allowed more than one government to evade proper scrutiny of the UK’s poor domestic management of fishing rights.  Now, with Brexit and withdrawal from the CFP apparently at hand, the present government is hoping for a huge dividend of new quota – to be won from other EU countries in the withdrawal negotiations – as the only palatable way to tackle the extreme inequality in our quota system. Ministers, echoing the views of those at the top of the fishing industry, have said any additional quota for the under tens or for new fishermen will have to come from this hoped-for Brexit bonus, and the distribution of existing quota should be undisturbed.

But there’s no guarantee that the UK will win new quota in the Brexit negotiations. Other European member states will fight hard to retain their current access to UK waters, and they have plenty of bargaining chips – not least the access to European markets upon which many British fishermen depend.  

Should the hoped-for quota dividend not be won, Brexit currently has little to offer fishermen but a continuation of the status quo (and perhaps a relaxation of EU rules intended to finally end overfishing). However, outside government, others are pushing to make Brexit the point at which the UK address its existing distribution of quota. This coalition of small-scale fishermen, academic experts and conservationists (including – declaration of interest – Greenpeace UK, which has campaigned for years for quota reform) argues that the need to write new fisheries law in the UK can be the opportunity to reassert the fact that fisheries are a public resource, and to give ministers the power and the duty to distribute quota in a way that secures the greatest social, environmental and economic benefits.

“In essence, fisheries have been accidentally privatised,” New Economics Foundation researcher Griffin Carpenter told MPs tasked with scrutinising the fisheries bill. “Every year, quota is allocated to the same holders, and there is a legitimate expectation that that continues in future.

“The Department for Environment, Food and Rural Affairs and other organisations are too scared to break that hold on the quota and say, ‘This year we will allocate quota differently.’ It has not been done; it is basically privatised now the claim is so strong.

“If there is ever a point to break that link, it is now.”