02 Sep 2020
17 Jun 2020
The Portfolio Committee convened on a virtual platform to be briefed by various entities, including FishSA and Soundprops Investments Shareholding 1167; Oceana Group; Premier Fishing; Irvin and Johnson; Sea Harvest; and African Pioneer Group on the commercial and small-scale fishing industry. The presenters included significant information on what their companies were doing to fish sustainably and to invest in small businesses; their contributions towards transformation of the fishing sector and the growth of the economy; application of the broad-based black economic empowerment, amongst other things.
Members noted that by 2050, scientists have predicted that world fishing stocks will collapse. What is the anticipated plan or model that companies envisaging in lieu of this catastrophe? How are the companies seeking to offset their carbon footprint? One company said that it was investing in solar photovoltaic (PV) installations; they wanted to hear what the other companies were doing.
Are the companies looking at technology to improve bycatch levels so that threatened marine species are not being inadvertently killed? What investments are companies making to protect South Africa’s marine species and to ensure that large portions of its ocean remain intact, so that companies can be sustainable in the long run? There are a number of marine protected areas (MPAs) that are severely under-resourced; perhaps corporates could try and assist government in maintaining these areas and the vital fish stocks and nurseries that they hold.
How are all these companies going to contribute to ensuring that South Africa stops foreign trawlers from coming into its oceans and poaching its fish sources? It should not just be the responsibility of Department and the Blue Scorpions. Is there any kind of joint initiative that all these companies can come together to do to stop poaching of abalone and other fish sources?
Members were also concerned about gender equity, and the inclusion of youth and people living with disabilities in the employ of these companies. Members implored the companies to consider this, as part of the National Development Plan objectives. How much have the companies contributed? When they talk about transformation, what are they talking about? Could the companies give details? Other companies have given percentages and figures.
The National Environmental Management Act says that at the end, one must rehabilitate the area, and protect the community that lives next to that area. Even the Constitution says so. The Portfolio Committee needed to know about that, because it is dealing with environmental management, fisheries, etc. A Member wanted to know what South Africa’s rules on marine protected areas are. Generally, what are the regulations?
The Department responded to issues that were raised by small-scale fishers at a previous meeting. While some of the issues had been resolved, other issues were still ongoing, with some having been occurring for many years
The representatives said that they would take the Department’s responses back to their constituencies and discuss them.
Opening Remarks by the Chairperson
The Chairperson opened the virtual meeting, welcoming the Members and the delegates from the various entities that were in attendance to present. He noted that he had received an apology from Mr Loyiso Phantshwa, Chairperson of FishSA. The Portfolio Committee (PC) was expecting representatives from commercial fishing companies, and was also expecting a delegation from the Department. The Department would be responding to small-scale fisheries.
He explained that the Committee is almost an extension of Parliament in terms of section 42, subsection three, of the Constitution. Its task is to represent people and to make people feel that they are participating on issues of government. It is to create a forum for people to debate issues and discuss them. “We cannot discuss issues if we do not know”. It is always good to know, and the PC goes beyond that to overseeing the actions of the Executive. When he said “overseeing” he was not saying that the PC is the Executive. The PC oversees the Executive’s actions as it continues to execute what it is expected to do in terms of the Constitution.
On what informed today’s session, the Chairperson recounted that the Committee did meet with organisations of the industry, and he knew that FishSA did make a presentation but could not complete what it was doing. There was a request from the commercial fishing companies to introduce themselves to the PC. The first item in the meeting would be the introduction by the commercial fishing companies and the second item would be the feedback to the small-scale fishers.
The Committee Secretary said that there were apologies from the Minister and the Deputy Minister.
Mr N Singh (IFP) moved to adopt the agenda; Ms N Gantsho (ANC) seconded the motion.
The Chairperson asked if FishSA could lay out the context for the companies that would be introducing themselves. Most Members are new Members; unfortunately, the break caused by COVID-19 meant that the PC could not work for six months.
The commercial fishing industry briefed the PC on the following main points:
- Introduction of the Company
- Transformation credentials across black economic empowerment (BEE) scorecard pillars
- Contribution to the economy of South Africa; and
- COVID-19 response to staff and communities.
SMME & Commercial Fishing Companies: FishSA
Ms Shamera Daniels, Vice Chairperson, FishSA presented. Mr Loyiso Phantshwa had sent his apology. Her understanding was that the request for this meeting originated from the PC and not from FishSA. She could not say anything more beyond that there are fishing companies represented who were asked to introduce themselves to the PC.
The Chairperson said that the PC is still learning about how the industry is organised. Basically, the request for introduction was from the commercial fishing companies, but the PC was told that those companies are under FishSA.
Ms Daniels said that in the presentation by FishSA, it did request that each sector does a presentation, because there are 22 sectors in the fishing industry (over and above companies introducing themselves). For example, the West Coast Rock Lobster sector would present; hake deep-sea trawl would present, etc. Since all the sectors are so different, the request was that they each get equal time to deal with their specific issues.
Ms Daniels said that she wears many hats in the fishing industry. Today, she was wearing the hat of a right-holder. Her presentation provided information on one of the companies she has shareholding in, namely Soundprops Investments Shareholding 1167; this company also has a small hake deep-sea trawl right through a company called Sydow Fishing. She wanted to express her concern that of the companies invited today, she was the only small, medium and micro-enterprise (SMME) and at the lower end of medium if one looks at her turnover. She requested that the PC have a dedicated session with SMMEs to deal with their specific issues and concerns around the next few months. SMMEs operate in different environment to other businesses; SMMES are determined by what Government gives to them, and not by what they produce or grow. Government decides the size of SMMEs.
Mr Singh said that Ms Daniels made a very important point about the large-scale fishers and the small-scale fishers. One notices that one has small-scale fishers such as SMMEs, and then there are subsistence fishers. The PC had received a presentation from the South Durban Community Environmental Alliance on subsistence fishers. The presentations that the PC received are from large trawlers and similar entities; perhaps the PC needs to separate the topics and come up with something comprehensive later on.
The Chairperson said that he had noted what Ms Daniels proposed.
Briefing by the Oceana Group Ltd
Mr Imraan Soomra, CEO, Oceana Group Ltd, presented. Full details may be found in the presentation. The presentation had the following main headings:
- Our Transformation Credentials
- Our Contribution to the SA Economy
- COVID-19 Response to Staff and Communities
- In 2004, Oceana implemented a strategy to advance BBBEE across all pillars equity ownership, management control, employment equity, skills development, preferential procurement, enterprise development, and corporate social investment
- Level One BBBEE rating since 2013 never rated below Level Three.
- Most empowered Food Company on the JSE 2019 and consistently in the top five most empowered companies.
- Achieved maximum B-BBEE points for board, non-executive and executive director composition.
- Black ownership has increased from 45% in 2010 to 72% in 2019.
- Black female ownership has more than doubled from 11% in 2010 to 24% in 2019
- Over 90% of the workforce is predominantly HDIs (historically disadvantaged individuals). Female HDIs has risen from 35% in 2010 to 41% in 2019
Transformation of Fishing Sector
In terms of BEE pillars: There has been a significant amount of procurements from female-owned companies. In 2020, Oceana spent R35 million on skills development. In 2020, it spent R7.4 million on corporate social investment (CSI).
Oceana Positively Impacts the Economy of the Country
- The annual GDP contribution made by Oceana has grown by 119% for the period 2013-2019.
- Economic Contribution to Employment:
• On average, Oceana employs 4 000 direct employees (both permanent and seasonal) across RSA.
• Oceana’s annual wage bill for permanent employees in 2020 is just over R574 million, which equates to an average salary of approximately R382 700 per annum. In total, Oceana accounted for approximately 45 796 jobs across South Africa in 2019.
- Tax contributions to government:
• R4 billion in taxes contributed through tax revenues paid to the fiscus, in the form of Vat receipts, corporation tax and PAYE remittances since 2005.
• Oceana’s total cumulative exports have exceeded R18.5 billion from 2005 to 2020. Oceana has made a substantial contribution to South Africa’s export earnings.
- Additional contributions to government:
• Beyond its contributions to the economy through GDP, employment and tax revenues, Oceana support the RSA economy through preferential procurement, corporate social investment initiatives, and capital investment projects in the communities within which they operate.
We Are Together: Oceana’s Contribution to Economic Revival Plans
- Oceana, as corporate, has a role to play:
• Investment in the Oceana Maritime Academy will amount to at least R400 million +
• Lobster traceability project
• Envisaged second empowerment scheme for staff and SMMEs of R500 million
• Solar project and carbon emissions reduction targets
• Board, Executives and senior leaders of Oceana contributed approx. R3 million towards food security, after announcement of Solidarity Fund by President Ramaphosa.
- Oceana Desalination Plant:
• In response to the drought conditions in the Western Cape:
• R30million investment in two new desalination plants at our canning facilities and reverse osmosis at CCS facilities and grey water solutions at the corporate offices;
• Desalination investment enabled uninterrupted production, enhanced water security for host communities, and created up to 2 500 jobs in St Helena Bay & Laaiplek;
• Reduced depletion of local fresh water resources
- Contribution to Laaiplek:
• Since inception of the JV arrangement (Amawandle Pelagic):
• Increase in employment at AP by 29%
• Increase in salaries and wages paid by 56%
• Increase in canned pilchard production by 339%
• R100million of capex (capital expenditure) spend.
- Over a 10-year period, Oceana’s total investment in the Oceana Maritime Academy will amount to at least R400 million+.
- Current investment does not include:
• The potential development of the entire site surrounding the Academy
• Expansion into the ground floor (+/- 1 055 square metres)
• Accommodation wing (21 en-suite bedrooms)
• Develop aquaculture training facilities (proximity to the harbour)
COVID-19 – The Oceana Response
- Guided by two primary directives:
• Provide food security
• Keep our employees safe
- Agile decision making and effective implementation early on
- Proactive activation, most prior to lockdown, of health and safety protocols at our operations and storage facilities
- Strong communication and hands on leadership at the site level
- Workforce rallied to the call 100% attendance at almost all sites
- Positively Impacting Lives (impacts included):
• Over R3.4 million spent on CSI
• 7 000 small-scale fishermen received food parcels
• R600 000 medical supplies to Gift of the Givers
• R3 million donated by Oceana Executives and Board Members to help fight COVID-19 through relief fund
• R20million COVID-19 funding providing additional once-off recognition bonus to employees
Lessons from 2020 – Helping Shape Oceana’s Future
- Diversity, equality and inclusivity must take centre stage
- Empowerment of the disempowered must be at the forefront of our thoughts
- Sharing economic and social benefits with those most in need should inform our actions
- Ultimately, people are more important than profits
- We have learnt that power and privilege has little value unless it is converted into service
- This year has made it abundantly clear that how a business acts in relation to its people and other stakeholders, significantly influences its longer-term sustainability and success when actions are sincere
- In the long run, purpose led businesses are more successful
Ms S Mbatha (ANC) said that it was difficult to engage if Members received presentations late. The PC was supposed to prepare itself for this meeting. The PC had been talking about how it must get presentations prior to meetings, so that Members can prepare themselves. She had just received the Oceana presentation.
The Chairperson noted Ms Mbatha’s concern.
Briefing by FishSA (continued)
When Ms Daniels continued with her presentation, she reiterated her request for a specific SMME engagement. She represents two companies. The bigger one is Soundprops Investments 1167, which has two fishing rights – small pelagic and hake longline. Soundprops has become a meaningful player in both sectors. It has a 10% stake in a hake longline vessel (see presentation). Even with small allocations, the company has been able to make inroads and become meaningful players in the fishing industry.
Introduction of the Company
Rights (2020 Season):
- Small Pelagic
- Anchovy - 10 799 t
- Pilchards - 308 t
- Hake Longline - 59.9 t
- MFV Boetie Akie - 100% - Small Pelagic
- MFV Emerald - 100% - Hake Longline
- MFV Highland Queen - 10% - Hake Longline
Sydow Fishing has a Patagonian toothfish right, and is in a JV, as most people are in that sector. It has a very small hake deep-sea trawl right of 165t. Should the company be given the opportunity in the SMME forum, the issue of viability becomes very important. Ms Daniels recalled that someone made a joke with her once that one cannot even run a fish shop on 165t of hake deep-sea trawl products. That is something that the company wants the PC to take cognisance of: There are SMMEs but viability is very important, and that is in the hands of government.
Transformation Credentials across B-BBEE Scorecard Pillars
RATING (The entity’s turnover is less than R10 million so the scoring is different).
Black Ownership Percentage - 96%
Black Female Percentage - 85%
White Ownership Percentage - 4%
B-BBEE Status - Level Two
Soundprops is committed to procurement from black-owned companies; which is “fundamental to grow the economy in South Africa”.
Contribution to the Economy of South Africa
- The current value of our fishing right is approximately R6.8 million.
- Through vessel ownership and secondary industries, we have created 52 direct jobs:
• Vessels - 42
• Workshop - 7
• Office - 3
Sydow Fishing has a vessel that has a crew complement of 60 plus, but due to the company’s quota not being large enough, it cannot operate the vessel.
COVID-19 Response to Staff and Community
- Donation to FishSA-coordinated initiative. This was in conjunction with the Minister, and the donations from the initiative went to feeding schemes in different communities in South Africa.
- Kept 100% staff compliment.
Ms Daniels wanted to reiterate that Minister Barbara Creecy and her Department was truly amazing in handling the different crises that came up at the time.
Premier Fishing & Brands Limited
Ms Rushaan Isaacs, CEO of Premier Fishing, presented. She was accompanied by Mr Mandla Mbusi, Public Regulatory Affairs: Premier Fishing.
The contents were as follows:
- Introduction about Premier Fishing (PF)
- Transformation credentials across BEE scorecard pillars of (PF) and subsidiary companies below
• MARINE GROWERS
- PF contribution to the economy of South Africa; and
- COVID-19 response to staff and communities of each.
Premier Fishing & Brands Limited is the listed company, and Premier Fishing SA is the operational company. There are three subsidiaries: Marine Growers (aquaculture farming), Premfresh Seafoods (sales and marketing), and Talhado (where the company owns a 50.3% stake). The Group is predominantly involved in commercial fishing, fish processing and marketing. This includes sustainable aquaculture farming through our abalone farm and the manufacturing of Seagro, an environmentally friendly fertiliser product.
- One of the largest black-owned and managed fishing companies in South Africa, in existence since 1952.
- First black woman CEO in the South African fishing sector.
- Black woman chairperson on PFB Board
- In the process of restructuring PFSA Shareholding, by implementing a BEE Employee Share Trust.
- The Premier Fishing Group currently employs just over 900 staff members; focused around transformation and development.
• PF employment equity ratio – 90% Staff are employed from impoverished fishing communities.
• The staff retention - years of service per person between 10-40 years.
• PF has a Bursary Scheme that issues bursaries to assist employees to further educate their dependents.
• PF learnership programmes were implemented for the advancement of skills and training in the communities, and this enhances the contribution to the socio‐economic conditions of society.
• Regardless of current COVID-19 pandemic our priority is always staff‘s health, safety & job security.
• Recently, Marine Growers embarked on an employment drive to recruit additional 100 staff members at the aquaculture farm.
• In process of restructuring shareholding
- 90% of staff is from impoverished fishing communities such Hout Bay, Saldanha Bay, and Humansdorp.
During COVID-19 safety is even more important.
- BBBEE level one contributor: All Bus:
• Premier Fishing
• Marine growers
- Procurement Spend:
• In excess of R100m from 200 suppliers with majority black owned including SMEs, EMEs and QSEs.
• Preferential payment terms to these suppliers, ranging from 7 to 30 days.
• Some of these suppliers have been with Premier Fishing for more than 20 years and some of these suppliers are exclusively supplying Premier.
• We continue to develop ESD initiatives.
• A number of these SME’s, EME’s and QSE’s rely on corporates like Premier to provide business sustainability and in turn job creation.
• Majority of our procurement spend is sourced locally and especially in previously disadvantaged communities.
- Salient Points:
• 90% of procurement was on black-owned suppliers
• 30% of spent to suppliers classified as EME
• 35% spent on suppliers classified as QSE
Corporate Social Responsibility
- Premier Fishing has been involved in a number of social investments as follows:
• Gold Sponsor to the NSRI.
• Annual sponsorship community of Saldanha Bay.
• 82 Housing Development Subsidies in Saldanha Bay
• Somerset Hospital – sponsorship for the upgrade of their medical facilities
• School sponsorships in impoverished fishing communities
• “Voorskot” (upfront loans) – in the local and surrounding fishing communities
• The Premier Fishing Bursary Trust
• Premier Fishing Learner‐ship Programme
• PF donated food parcels to the staff in the communities and to rights holders
- COVID-19 Risk Assessment Policies were implemented and the following company protocols were followed:
• Constant Staff Refresher Training: On Site H&S Manager with designated Covid-19 Team
• Sanitising stations were established and screenings of all entrants to company properties.
• Third party medical contractor was appointed to undertake screening all staff at all the operations
• At two separate sites, we had COVID-19 incidents and was handled according to all government regulations
• Company covered all medical costs of affected employees
• Regular Sites & Vessels Decontamination
• Social Distancing: Screens & Floor markings
• During COVID-19 period no salaries were reduced.
• Alternative work arrangements were implemented (work on rotation and remotely.)
• We made sure that we were abreast of rapid changes to the labour laws, PFB and its subsidiaries ensured there was constant communication between DAFF, DOL, SAMSA, NSRI and all other advisory stakeholders
• Private Transportation for staff
Ms Mbatha asked if she could get the presentation, and requested that the Committee Secretary check which presentations were distributed to Members. The Committee Secretary replied that she had sent the presentation to the WhatsApp group for the PC. She confirmed that Members did not have the presentations that arrived after she sent the meeting invitation on the previous day (Monday, 26 October 2020).
Ms Mbatha said that the Premier Fishing presentation came late; the Members could not engage with that presentation when they arrived that late.
The Chairperson said that the PC had noted that item for discussion, namely late submission and receipt.
Irvin & Johnson (I&J) Limited
Mr Jonty Jankovich, CEO at Irvin & Johnson Limited, presented. He was accompanied by Mr Innocent Dwayi, Employee and Stakeholder Relations Manager: Irvin & Johnson Limited.
The presentation noted that I&J is Marine Stewardship Council(MSC) certified, and Aquaculture Stewardship Council(ASC) certified.
Irvin & Johnson at a Glance
- B-BBEE level one.
- Over 2 000 staff.
- Onsite and free clinics and medicine, in factory and seagoing environment.
- Unionised environment
- R181 million paid to black staff since 2005 in share schemes
• 37.2% total black ownership
• Direct black employee shareholding
• 73% black management
- Education and Training:
• 469 youth learners
• >R35 million invested in skills development over the last five years
• 460 small-business partnerships
• >21 small and medium-sized fishing partners
• R222 million annual spend with small businesses
- Community support and development:
• >15 NGOs supported every year (e.g. The Children’s Hospital Trust, Peninsula Schools Feeding Association)
Small Business Partnerships
- 460 small business partnerships
- 85 are 100% black-owned.
Investment in training & development over the last five years:
- >R35 million spent, 5 165 people trained
- 469 learnerships
- 674 bursaries
- 25 university graduate trainees
- 56 I&J apprenticeships
- 6 internships
- R3 million work integrated training for 1 035 people: Compliance, soft skills, food safety, technical and on-the-job training
- 36 000 hours indirect experiential training
- Situated at Hermanusand and Gansbaai
- 178 Employees
- ASC certified–Internationally recognised environmental certification
- 8.5 million litre/hour seawater pumped into concrete abalone housing tanks
- 600 ton production capacity per annum
- 3 500 tons per annum of kelp for abalone feed harvested and purchased from local rights holder
- R144 million (Capex) + R19 million (R&M) investment over the last five years
The main aquaculture species in South Africa is abalone. The business is even more complicated than land farming, because it draws water from the sea. The sea also has its challenges, with red tide being the most dangerous poison that humans could ingest (as a result of eating abalone); that is something I&J has to manage against.
- There are 14 abalone farms in South Africa
- Generate in excess of R700m annual revenue to RSA
- High fixed cost and long working capital cycles minimum four years growth before sale.
- 70% located in the Western Cape province
- 82% of the volume is in the Overberg region
- South Africa supplies 3% of the world supply of farmed abalone
- I&J is a pioneer in RSA abalone farming
- Pump ashore facility located at Danger Point in the Overberg
- Its current capacity is 600 tons
- 145 full time employees
- A processing plant is located in Walker Bay, Hermanus
- 33 full time employees
COVID-19 Response & Investment
- Establishment of COVID 19 Task Team and appointment of Compliance Manager to ensure that all safety measures are implemented
- Introduction of R200 per day lockdown allowance to incentives attended during hard lockdown to operational staff
- Onsite medical staff/nurses and Doctor to support all staff
- Transport at 100% cost to the company since March 2020. As risk mitigation, in terms of public transport and the call for social distancing, the company at significant cost, has provided transportation to operational staff during this period
- Daily operating Call Centre to follow up on employees diagnosed for COVID 19 quarantine, isolation even hospitalised
- Food parcels to all I&J Staff and to communities all around the country
- Installing specific site access screening technology and additional PPE to all employees
- Providing additional specialist medical staff and converting some vessels to quarantine sites at our cost
- Installed awareness and education communication at all sites
- Installed protective and segregation screens on production lines and on desks for office staff, standard operating procedures in change rooms and canteens
- Remote working solutions to employees who were able to continue with their work from home
- Employees with co-morbidities were placed on paid time off since March until level-one lockdown regulation were introduced
- Total COVID19 cost/investment in excess of R18 million
Key Industry Takeaways
• Respected industry internationally competitive sector, diverse, risky, complex, and transformed
- Employment creator maximum local beneficiation which has created quality jobs for a very long time
- Economic contributor investment, employment, taxes, education, training, CSI and
- Significant investor/supporter/grower of SMMEs
- FRAP 2021 – please complete a comprehensive socio-economic impact assessment at the outset
• Poaching destroys the ocean and steals jobs/value from South Africans.
• Funding support government support needed for farms impacted by COVID-19
• Department of Trade, Industry and Competition(DTIC) support - Help industry to build new abalone markets for RSA abalone
Sea Harvest Corporation
Mr Felix Ratheb, CEO of Sea Harvest Corporation, presented.
Employment in the Fishing Sector
- About 3 230 employees
- R711 million in salaries and wages paid (2019)
- Skills Development Spend (2019): R38 million
- Employee Share Schemes own: 6.1% of SHG
- Annual Dividends and Share Sale Proceeds to employees (2017-2020): R230 million
Transformation – Black Ownership
(See graph on page 19)
Sea Harvest is 83% black-owned, and is currently a level one B-BBEE contributor
Transformation – Staff
- 38% female, 62% male
- 38% African Black; 57% Coloured; 1% Indian; 4% White
- Unskilled and defined decision making/Semi-skilled and discretionary decision-making: 98% African Black/Coloured/Indian; 2% White
- Management: 85% African Black/Coloured/Indian; 15% White
- Total supplier spend (2019): c. R1.7 bn
- Supplier spend on black-owned (>51%) enterprises: R850 million
- SMME supplier expenditure pend (2019): R340 million
- Number of SMMEs supported: 427
Local Economic Development
• Direct and Indirect Jobs in Saldanha Bay c. 5,700 (30% of the workforce in the town)
• Annual Household Income in Saldanha Bay: R470 million
• Annual supplier expenditure in the municipality: R100 million
• Annual Contribution to the GVA of the municipality: R454 million
Sea Harvest was hard-hit with COVID-19 on the West Coast, when it started being transmitted in communities. Social distancing in communities is very difficult. At one stage, Sea Harvest had 189 positive cases in its facilities 100%. The Minister was “incredibly supportive” and so was the Department of Employment and Labour. Mr Ratheb was happy to report that Sea Harvest had a 100% recovery rate; all of its staff body came back to work. What this incident taught it is that it needs to support and make sure that it does not get this disease in its facilities; the most important thing is to screen people, having medical personnel onsite, and protecting the vulnerable employees (people with co-morbidities and people who are older).
- COVID-19 has had a significant effect on markets and costs Recovery Plan is required.
- Minister Creecy has been very supportive to the industry in developing protocols and assisting through the pandemic.
- Even though the pandemic has had a major impact on the sector all jobs have been maintained thro1ugh the period.
- COVID-19 safety protocols undertaken by Sea Harvest during the pandemic:
• Conducted over 16 000 daily medical screenings and the engagement of additional medical practitioners and services in assisting clinics on sites.
• Social distancing in the workplace through work from home or onsite reconfiguration.
• Provided PPE to all staff and an increased disinfecting regiment at all sites.
• A Risk Assessment protocol was developed for all sites to ensure safety for staff in high-risk transmission areas.
• Management of vulnerable employees at all operational sites.
Challenges in the Sector
Mr Ratheb expressed concern over foreign vessels in South African waters. These vessels were chased away in the late 90s. Cape Town is currently voted the third worst port in the world in unfair labour practices in fishing. That is happening on foreign-flagged vessels, not South African ones; unfortunately, these vessels are operating in South African waters. The industry needs to watch out for that, because it is creating a poor international image for “South Africa (Pty) Ltd.”.
There are budgetary constraints within the Department, which is a big concern for Sea Harvest when it comes to research. Have world class research, but under pressure with constraints. It has an impact on how we manage resources.
Positives of the Sector
- Globally competitive sector versus other traditional fishing nations (e.g. USA, Russia, China, New Zealand).
- Gold standard in Sustainability MSC which provides market access in an increasingly environmentally conscious society.
- Strong forex earner
- Maximum beneficiation in South Africa thereby creating maximum employment locally.
- Increased broad-based black and employee ownership over the past 15 years.
- Significant SMME support from the sector due to profitable enterprises.
- Assists in creating local food security.
Outlook – Fishing Sector
- FRAP is creating significant anxiety with all stakeholders in the industry.
- The viability of right holders FRAP 2005 & 2015/16 had effects on volumes leading to employment concerns.
- It is important to be clear what the fishing policies want to achieve from the outset. Are they aligned with government priorities?
• Maximise employment
• Encourage Investment
• Ensure inclusive growth
• Protect Sustainability
The fishing industry is completely aligned with the National Development Plan.
- Comprehensive Socio-Economic Impact Assessment Studies for the allocation sectors need to be undertaken utilizing credible economists.
- The policy outcomes and allocations must be fact based on the economic and transformation reality of the sectors with robust input from stakeholders in the sector.
African Pioneer Group: Pioneering for the Future
Mr Stephen Dondolo, Group CEO, African Pioneer Group, presented.
Transformation credentials across BEE scorecard pillars
- The company is 100% black-owned and a level one B-BBEE contributor.
- Our shareholders are broad-based, including a 3% shareholder Ditikeni Trust, an NGO focusing on identifying and supporting previously disadvantaged communities throughout the Eastern Cape.
- We established African Pioneer Foundation NPC which focuses solely on CSI projects and also provides training in various courses to people from the HDI group around the Eastern Cape.
- We ensure preferential procurement of at least 60% throughout our subsidiaries is from black-owned companies.
Contribution to the economy of South Africa
- African Pioneer Group is one of the key contributors to job creation in the Eastern Cape and Western Cape region through our vessels and factory owning subsidiaries in the fishing industry.
- We have shareholdings and board representation in companies, employing in excess of 1000 people, seagoing and land based.
- African Pioneer Group is the majority shareholder of Eyethu Fishing and Sea Pride processors which own production/processing facilities.
Main Investments in the Fishing Industry
- One of our most significant investments in the fishing industry that contribute towards job creation and the economy of South Africa are Eyethu Fishing and Pioneer Fishing (West Coast).
- The two companies have something in common: they both have a processing facility and employ more than 800 people combined.
- Eyethu Fishing is a trawling, pelagic harvesting and fish processing business that produces a wide range of fish products for local and export markets.
- Our factory is situated in Port Elizabeth Harbour, currently holds a – 10 000t per annum processing capacity
- Total Staff Compliment at Eyethu Fishing is 300 staff members since last year with the possibility of employing approximately 1000 people when operating at full capacity.
- Our factory needs at least 6 000t of hake and bycatch to be profitable and operate at full capacity.
Eyethu Fishing Growth Possibilities
- Extra capacity in our factory if raw material is available will push our capacity from 10 000t to 15 500t per annum, with installation of two extra processing lines which will create 400 sustainable additional jobs.
- Pioneer Fishing has grown from humble beginnings in 1947 to an industry-leading producer of quality canned pelagic fish, fishmeal and fish oil for local and international markets.
- We have a rich history in development and technical innovation.
- For the first time in South Africa a major fishing group is owned by a broad base of historically disadvantaged individuals, with significant economic benefits accruing to black women.
- This is a significant milestone towards the national government’s objective of ensuring a broader geographical sharing of economic benefits across the country; away from the historical wealthier economic centres.
COVID-19 Response to Staff and Communities
- We have appointed a COVID-19 response committee in our main office and ensured our subsidiaries do the same to enforce the COVID-19 safety and preventative measures.
- We held weekly COVID-19 information and prevention sessions via zoom to alert employees about the statistics, new information, remedies, quarantine sites, what to do if you suspect you have been infected and ensured we remind everyone about the preventative measures.
- Our factories and vessels provided the relevant information to all the ones that are on site and on board in different languages to ensure everyone is aware of the virus and how to prevent it.
- We sponsored all staff with masks and sanitisers for personal use and also made available extra disposable masks in the office and factories.
- We made available sanitisers in all our exits and public areas.
- We provided a COVID-19 register and a questionnaire to screen all visitors.
The Committee Secretary said that West Point Fishing was supposed to present, but it had not joined the meeting.
The Chairperson thanked the companies for their presentations. The purpose of the meeting was for the companies to introduce themselves to the PC, which had been done, even if the PC had raised concerns about receiving presentations late. The PC would get the presentations at a later point. It would find time to go through the presentations.
Mr J Lorimer (DA) noted that the decision on whether there would be a cut in fishing rights allocations would be decided in the upcoming FRAP. Do the companies agree about the effects of quota cuts? Are the cuts survivable? How much can companies afford to lose?
Ms H Winkler (DA) first thanked the presenters. She said that she wanted to ask a more global question. Considering that by 2050, scientists have predicted that world fishing stocks will collapse, what is the anticipated plan or model that companies envisaging in lieu of this catastrophe? How are the companies seeking to offset their carbon footprint? Marine vessels do contribute quite significantly to CO2 (carbon dioxide) emissions. One company had said that it was investing in solar photovoltaic (PV) installations; she wanted to hear what the other companies were doing.
Regarding bycatch, she wanted to know if companies keep a record of how much bycatch the industry has. Are they looking at technology to improve bycatch levels, so that threatened marine species are not being inadvertently killed? What investments are companies making to protect South Africa’s marine species and to ensure that large portions of its ocean remain intact, so that companies can be sustainable in the long run? There are a number of marine protected areas (MPAs) that are severely under-resourced; perhaps corporates could try and assist government in maintaining these areas and the vital fish stocks and nurseries that they hold. There is plenty of plastic pollution in the oceans; since the model relies on companies taking from the oceans, then what are companies doing to give back? One company mentioned that there were issues in the Cape Town port (labour issues); could it please elaborate on that?
Mr N Paulsen (EFF) wanted to know how much of the bycatches came from new entrants with fishing quotas, and do not have the resources to go and harvest their allocation, and then sell it to bigger fishing companies. How much of the total quota which companies caught comes from those quota holders? Other than getting the quota from those quota holders, do those quota holders also work for those companies?
Mr N Singh (IFP) thanked the Chairperson for his leadership and initiative in inviting the companies to make presentations. For him, it was much larger than a fishy business. The PC has had all the big fishing people here. But he wanted to emphasise that once the PC takes care of the big companies, and it recognises the contribution they are making to the economy to job creation, the PC has to worry about the small fishers. This needs to be looked at holistically. He asked if the companies could tell the PC about the 98% import of pilchards. It is a matter of concern – is it that South Africa does not have this type of fish in its oceans? If not, what is the reason? How are all these companies going to contribute to ensuring that South Africa stops foreign trawlers from coming into its oceans and poaching its fish sources? He did not think it should be just the responsibility of DEFF and the Blue Scorpions. Is there any kind of joint initiative that all these companies can come together to do to stop poaching of abalone and other fish sources? He felt that it was good to hear that the beneficiation aspect is as good as it is, and he hoped that the mining industry can take a leaf out of the fishing industry’s book, because most of South Africa’s mineral resources go abroad and then get beneficiated, and come back to South Africa to be sold. How many ex-DEFF employees are in these companies, whether they came from Agriculture, Forestry, but are now leaders in these companies. Were there any allocations or policies that were geared towards favouring some of these companies?
He wanted to talk about the fishing rights allocation process (FRAP). That is something that needs to be looked at very carefully, because these are very capital-intensive businesses and they cannot be given short-term rights; Mr Singh mentioned that Mr Dondolo made an excellent presentation and that the PC wants to see his company grow, and he thought it was the Members’ responsibility as political office-bearers to work with the Department and see how this industry can contribute more to the local economy, to export and to job creation in South Africa.
Mr P Modise (ANC) wanted to take the opportunity to welcome the presentations from “the big fish themselves”. As time goes on, the PC would like to interact with the “small fish”. He wanted to know what the contribution of these big companies is to job creation.
Ms Mbatha said that big companies, when they come to a meeting, must know that they must submit presentations beforehand. She asked that abbreviations not be used; she did not know the meaning of FRAP. She comes from Gauteng, where there is no sea. She was confused, and could not follow properly; most of the presenters were talking about FRAP.
There is the issue of the foreign vessels – how best can companies assist in this issue? The companies need to meet the Government halfway, so that both parties can assist each other. There was a study that was done for the PC. She believed that the study was not done by any of the companies, otherwise it would be biased. Such a study must be done by an independent person. The PC usually uses universities to assist it. If it was done by the companies, then it would not be a fair study; the companies would look at protecting themselves, so that they reach whatever goal they want to reach. She was not saying it was like that, but such a situation could lead to a biased study.
On small fishing business: How do the companies assist small businesses, so that those who want to start a business can get fishing rights? Are the big companies doing this, and how many do they take per year? When one looks at female employees – 38% of employees are female at Sea Harvest, which is still very small. Another thing that is important is the total number of young people, because once a company transfers skills to the younger generation, there will be more people dealing with a particular project. The women of that 38% are not in management. The PC wants to see the percentage of female and young employees, including disabled people, in all levels.
Ms N Gantsho (ANC) asked how much the companies had contributed, and when they talk about transformation, what are they talking about? Could the companies give details? Other companies have given percentages and figures.
Ms Daniels asked if companied would be responding to questions directly posed to their company.
The Chairperson said that he did not take exception if people raised their voices.
Mr Jankovich responded to Mr Lorimer’s question on the quota cuts and the impacts of cuts on companies. The industry had a study completed by Genesis Analytics, a well-known economics advisory group. The person who put that study together is now working for the Government, so the study is “reasonably credible”. The economic modelling that was done was a comprehensive socio-economic impact assessment across the hake deep-sea trawl sector. The study modelled the impact of quota gains and quota losses across the various businesses and/or sector. A 10% cut in the total allowable catch (TAC) was modelled by Genesis to have a “fundamental impact” on any one of the major companies. Removing a quota would have a cascading effect on effect on jobs, and a deleveraging effect on the businesses the companies operate, in terms of vessels required, the factories that then will not be required, etc. It is difficult to “chop up” half a factory or a quarter of a factory, or half a vessel. If there was going to be a quota taken away from larger businesses, those businesses have the ability to upscale. I&J wanted to share the report with the Members.
In relation to transformation in employment: There is a slide which says that I&J is a level 1 B-BBEE contributor. I&J have met the tests and the hurdles, and the measures that are required, on the most recent set of B-BBEE rules.
[Mr Singh wrote in the chat box: The fishing industry is located and vibrant in the Western Cape and to a lesser extent in the Eastern Cape as expressed by Mr Dondolo of the African Pioneer Group. Apart from Sea Harvest having a factory in Durban, nothing else seems to be happening in KwaZulu-Natal. Why (is this)?]
[Ms Winkler wrote in the chat box: Could the other big companies speak to the questions I asked I&J? Are big companies spending any funds on environmental rehabilitation and protection?]
Mr Ratheb addressed the question on whether the companies are concerned about 2050. For him, it was “the most important question”, because it does not matter who owns quotas, if there are no fish in sea there is nothing one can do with it. That is what the companies spend most of their time on. Members will appreciate that Sea Harvest would never invest a billion Rand on vessels if it did not think that the resource would be there in the next 25 years. It would be “quite silly investments”. Sea Harvest is working with global organisations and the University of Washington is supporting such organisations in terms of trying to understand how to protect world fishing stocks. Mr Ratheb was happy to say that from the white fish sector (e.g. hake), it is currently 7.1 million tons, which is the highest that it has been since 1982. It does seem that with all the “headaches” of global warming the way resources are managed by countries is showing that stocks are recovering globally when it comes to white fish (which are bottom feeders), and things are looking “quite positive” for the sector.
On the carbon footprint, Mr Ratheb said that fishing activities (wild-caught fishing) has the lowest carbon footprint of the proteins that people know, whether it be beef or chicken. Even though the industry is operating trawlers, it still has the lowest carbon footprint of all of the proteins. The industry does measure such things; one can go to Oceana’s integrated report, one can go to Sea Harvest’s report; these are publically listed companies. That is not to say that Sea Harvest is not doing more; it has done desalination plants, and it has done wind turbines in some of its areas. It does understand that global warming is an issue, but Sea Harvest is happy to say that from a food protein perspective, fishing has the lowest carbon footprint.
On bycatch, he said that Sea Harvest is on the Responsible Fisheries Alliance (RFA), formed with WWF (Worldwide Fund for Nature); Members would know WWF for its work in managing resources. A Sea Harvest project involved measuring bird kills during fishing up-trawls. In the past, 30 000 birds were dying when Sea Harvest would go fishing for hake. It reduced that to less than 300 in a year with the initiative that it did with WWF. Bycatch is very low in its fishing because of the type of net meshes it uses; less than 10% of activity in hake is bycatch. The reason is that even if it was there, one would not want to bring it up, since one would be spending fuel to catch something that is of low value. It is in the interest of companies to limit the bycatch.
On investment to protect marine species: “What we have done as an industry is to say that we have ring-fenced our fishing grounds. The industry will not go out of the grounds that it has previously fished; it will not go into new grounds and develop new fishing grounds. The industry works with DEFF, which put that as a permit condition; e.g., in the hake fishery, the industry would only fish in those specific areas that had been fished, and not in areas that were not fished. The industry trawls only four percent of the South African exclusive economic zone(EEZ). It is the least, biggest problem. Unfortunately, it does not make as much money as those who are looking for fuels and gas, and the bigger issue out there is with people who are out there looking for much more expensive resources, and unsettling the benthic habitat.
Ms Daniels said that she sits in a unique position in this group of companies, in that she is the only SMME. Her take on the question of cuts is completely different. In the deep-sea trawl sector, there is one company here that has 43% of the TAC, and another with 30% of the TAC. Ms Daniels said that she has 0.01% of the TAC. For her, “the value sits in the value chain”. With 0.01% of the TAC, she cannot buy into the value chain.
With foreign vessels, should she get 6 000t, she could employ 60 people and potentially build a factory employing 300 people. “We need to look beyond what is there already, and look at what is possible in the SMME sector”. If SMMEs are empowered with viable quotas, then they could approach the existing companies and say, “Let us buy into your interests”, so there is no need to close down factories. Some companies are doing that but most of them are not, and that should be addressed. It is not just a question of cuts; it is actually about viability and whether it is worthwhile. An SMME in fishing is different from an SMME anywhere else, because government determines the size of one’s business. She could not sit on 165t of fish, and another company sits on 53 000t of fish; one cannot compare her to others. She asked for there to be a fair assessment of the fishing industry, and there needs to be redistribution; it is broad-based black economic empowerment, and there needs to be some level of sharing.
On the economic study, Ms Daniels said that as an SMME in the sector, she had publicly distanced herself from the study because it does not take into account the plight of SMMEs in the hake deep-sea trawl sector.
In response to Ms Winkler, she said that she was proud to say that Soundprops and the grouping the company is attached to in Saldanha Bay were busy building two new vessels in the small pelagic sector. Anything that has been built now is up to ecological standards. Soundprops belongs to the industry associations in the sector. One needs to acknowledge that South Africa’s fishing industry is one of the best-managed industries in the world, and recognition needs to be given to the Department for that. Through the South African Pelagic Fishing Industry Association, and through the Hake Longline Association, the company is in ongoing engagement with the Department around environmental issues.
In answer to Mr Paulsen, Ms Daniels did not think she could answer his question honestly, but she could say that from Soundprops even being an SMME, its vessels and other entities that it is busy pulling in to assist them with their rights application.
In answer to Mr Singh, she explained that the issue of the 98% pilchard imports is biological at this point. There is not much that can be said; one cannot blame the foreign trawlers for this issue. Ms Daniels used to work for the Department, and she resigned in 2005. She has been operating independently in the fishing industry since 2006, and the shareholding that she holds now, she bought in 2018. It was not allocated to her; she actually bought it. If Mr Singh wants details of the transactions, she is happy to make those available.
In answer to Mr Modise, she noted that he did not get to finish his question on SMMEs. As he could hear, she is “quite passionate about SMMEs”.
In answer to Ms Mbatha, FRAP is the fishing rights allocation process. As an SMME, Government constantly asks big businesses, “What are you doing to assist SMMEs?” As an SMME, she is asking Government now to assist her and fellow SMMEs with the fishing rights allocation, and give her viable quotas so that she can build a viable business. Soundprops is majority black female-owned and majority black female-managed.
A Member posted a question in the chat box: Ms Daniels replied that Soundprops is based in Saldanha, and she extended an invitation to the Members to come and see its operations and its vessels, and to see what it has done with the little quotas that it has.
Mr Dondolo said that he wanted to make a contribution on the SMMEs, and also take into account Eyethu as a factory that employs 200 people; it survives via the small quota holders that are linked to African Pioneer’s vessel. He did not think that African Pioneer’s (AP) survival was sustainable at present because the company was buying quotas from those people, and also no-one from the people who are bringing quotas to AP is working in its factory, since AP is already employing people, and also employs people who are on the vessel. For AP to be sustainable, it would be more helpful if the Department could see that the Eastern Cape is a needy area when it comes to hake allocations, so that it can build its own industry. The industry concentration must also spread. AP does have small quota holders in the Eastern Cape who are being asked to come along.
On pilchards, it is an environmental issue; the fish has disappeared. South Africa is importing pilchards for it to sustain itself until the fish comes back. AP acts as an agricultural business, where it is being affected by the environment on a regular basis.
Mr Soomran wanted to build on the comments on resources and declining ocean resources. Where resources have been managed sustainably and responsibly by governments in the last 15 years, those fishing resources are not in decline; they have actually been fairly consistent. The resources that are in decline – and there are many – those are irresponsibly managed, have no regulation around harvesting, and in particular, harvesting from illegal fisheries is significant in those resources that are declining. In the updated submission to Operation Phakisa that came from the fisheries sector, the South African scientific community alluded to the fact that most species are well-managed resources; credit to the DEFF for their role in securing those resources. For many of these resources, if South Africa continues to responsibly manage them, and has good oversight, good policy, and good regulation, then it can expect up to a 10% rate of increase over the next two decades. This is very promising for the industry, and also talks to the fact that with the right policy, one can increase jobs in what is traditionally “a very static space”.
On pilchard supply, Mr Soomran said that this question was misunderstood; it is not because the resource is mismanaged; it is that South African consumption of pilchards has grown significantly over the last 20 years. There has never been that level of pilchard supply in local waters to satisfy consumer needs; therefore, companies such as Oceana and African Pioneer have had to go elsewhere to feed the consumer need in South Africa. This is part and parcel of what companies go through. South Africa is going through a cyclical low, and information from the scientific community is that this population will be restored over time, given that there is strong management from DEFF.
On quota cuts, he explained that it depends on which side of the equation one sits, and therefore there is a high level of subjectivity on this matter. Oceana is supportive of the fact that Government has engaged on an economic impact assessment, as briefed by the Minister of DEFF, National Treasury, and the Office of the Presidency a few weeks ago. This will be an independent study, which will independently verify whether quota cuts are sustainable or not, and hopefully by deep analysis of each sector, it would be shown that the capital intensity of each of the sector has a major impact on whether or not quota cuts are sustainable. He was supportive of earlier comments that if one is going to be “taking from Peter to pay Paul”, then at the bare minimum, Paul needs to be an existing player in the sector. It needs to be ensured that Peter and Paul engage each other to ensure survivability. In his opinion, it makes no sense to take a quota from a current rights holder and give the quota to a new rights holder, if one does not enable the new rights holder to survive – whether it is providing skill, whether it is providing access to assets, whether it is providing access to markets, or participation in one’s business, or even funding: What is clear is that the banks will not fund one if one has a quota. Whether one has a 100t, 10 000t, or 100 000t, on its own, that will not be sufficient to traditional lending institutions.
With cuts, there is a path that can be walked together to ensure that existing rights holders, current SMMEs, and small-scale fishers can coexist. Mr Soomran believed that South Africa is headed towards a policy that will help define this on a sustainable basis into the future.
The Chairperson asked Mr Modise if he wanted to complete his question, and Mr Modise replied that the PC could proceed, because his network was highly unstable; he was trying to get a proper location, after which he would get back to the Chairperson.
Ms Winkler had further questions for Oceana and I&J. She wanted to know what the model would be if fish stocks collapsed in 2050. South Africa does not operate in isolation of the rest of the world; sustainable management of fish stocks by other governments speaks to whether or South Africa has sustainable fish reserves, and whether or not it can carry through these existing models and jobs. What happens, in the worst-case scenario, if South Africa is unable to sustain its existing fishing quotas into 2050? What happens to those jobs, to those communities, to those people? What are Oceana and I&J anticipating? How much are these companies contributing to marine preservation and protection? Since these companies are using resources that come from the ocean, it is only right that they are giving back and assisting Government to protect South Africa’s marine resources, and to ensure that the resources are there for future generations. There is a large contingent of subsistence fishers in KwaZulu-Natal (and possibly in other provinces) who really lack assistance – whether it is access to capital assets or markets. In what ways can the industry collaborate with government to assist these generational fishing communities, who are solely dependent on coastal fish stocks to survive?
Ms Gantsho had a question for Sea Harvest: Given the capital-intensive requirements in the sector, does it think that opening up of the sector to new entrants will lead to too much competition, and reduction of capital requirements for market entry?
Ms Mbatha wanted to comment on the study, to say that she did not think the companies should identify the person who is going to do the research for them. She advised companies to fund DEFF so it can get a person or a university to conduct the study. Even if the companies are saying that the study is not going to be biased, if it is coming from them, it is a problem. She is a researcher, and to her it is a problem. Somewhere, somehow, companies will manipulate the results. Leave it to the Department if companies want to do justice to the research. Fund the Department to do research; there is a research unit in the Department. Allow the Department to run it, and lead the companies. Companies can assist the Department – that is how work can be done fairly. With the small fishing businesses, how do companies mentor them, so that these businesses can get fishing rights? How many are assisted per year?
She did not know that there was an SMME present; an SMME cannot answer the questions that are directed to the big companies. She was worried about environmental management and protection. What happened to that? The NEMA (National Environmental Management Act) says that at the end, one must rehabilitate the area, and protect the community that lives next to that area. Even the Constitution says so. The PC needs to know about that, because it is dealing with environmental management, fisheries, etc. Let the PC know what is happening, and do not hide things. What Ms Mbatha had noticed is that once a person does not give information on time, then it seems that he is hiding that information. She did not get to go through the information to her satisfaction; she asked that the companies please answer the questions so that that PC understands. Both parties are here to assist each other. The PC’s main issue is that big companies are supposed to assist Government in helping build up the small ones. She had asked about women and the younger generation, but did not get an answer. “Let’s assist each other”. She also wanted to know how companies work with and assist the township economy. Townships are present where the companies are. In most cases, one finds that most of the work is in one area, but when goes to other areas such as KwaZulu-Natal, there is less work. Such a thing is happening in agriculture as well.
Mr Singh wanted to know what South Africa’s rules on marine protected areas are. In some MPAs, one cannot go and catch even one fish from the seashore; it would be one or two fish and then one “gets into trouble”. Generally, what are the regulations? He suggested that the PC should reserve its right to ask further questions of these companies once it goes through all the presentations in detail, because it needs that information before it comprehensively discusses the whole fishing industry.
Mr Soomran responded to a question on environmental management, and how South Africa does not act in isolation. Most of the companies in commercial fishing operate in conjunction with the Department. Oceana, I&J and Sea Harvest are founding members of the RFA, which works together with WWF and BirdLife South Africa to adopt and deploy good fishing practices, particularly from company vessels. Those initiatives are funded by the companies, and they all participate in global responsible fishing practices, and engage with scientific communities all over the world. As much as responses are seen as separate, the companies are all harvesting the same resource, and the responsible management of that resource is the responsibility of all companies. All work closely with government in this matter.
From time to time, government, through the various fishing industry associations, has approached the Pelagic Fishing Association, South African Deep-Sea Trawl Industry Association (SADSTIA) to fund its research, in particular, when funding has been short. One will find that government will confirm that the industry was able to assist in those areas.
On what companies are spending on responsible scientific management, Ms Daniels is chairperson of the Lobster Association; the industry has presented to the Department a lobster traceability project and has key players in that project.
On what the industry is doing to assist small finishing businesses: he indicated that Oceana has dedicated an amount of R3.5 to R4 million every year for the training of around 500 to 550 small-scale fishers; it is not just training them in fishing skills, it is also teaching life skills and practical skills such as opening a bank account, managing finances and how to survive at sea. This is done in conjunction with DEFF, helping in particular the fishing co-ops to gain the relevant experience that they need, thereby enabling them to become more commercially productive.
On what happens in 2050, that is “the ultimate question” for a fishing company operating in a space such as that of Oceana. It has to depend on good regulation, and it is about partnerships with the appropriate partnerships. Oceana operates under the proviso that fishing stocks could decline because of weather events, and unforeseen events that it does not have control over. One will find that most companies in this space would look to diversify, and some are ahead of others in diversifying. Over time, fishing companies will look to diversify their supply from resources harvested from the ocean to resources that are farmed (aquaculture as opposed to wild capture). Most fishing companies globally are making steady progress towards farming and away from wild capture, to ensure sustainability not just of job security, but also food security because fish protein is a critical component of human consumption.
Regarding specific questions on Oceana’s scorecard and leadership in its business, it will be happy to submit written responses to Members’ questions.
Mr Jankovich responded to the 2050 question. He was confident that the industry would never get to the 2050 scenario. Generally, with the science that is being used and adopted by the Department, the scientists within and outside the Department, the level of mathematics and modelling that has been applied, the rules and governance the Department applies to fishing companies, the fishing stocks in South Africa are “very well-managed”.
On MPAs, if he remembered correctly, there were an additional 20 MPAs that were promulgated. Those MPAs are set in stone. Fishing companies are monitored, and are restricted from entering or fishing in those areas; they can sail across them, but they are not allowed to fish in them. That is carefully managed and companies are comfortable with the management of those areas.
On local fisher support, a specific example of a small fishing business is abalone, where I&J has local businesses who harvest kelp for the abalone. I&J supports 460 small businesses; 21 of those are specific fishing businesses. I&J has had relationships with some of those businesses for 20 years; it supports these businesses in various ways. He suggested that I&J should send the Committee the specifics of how it does that. It ranges from supporting those businesses in operational requirements, maintenance requirements, marketing requirements; it depends on the business. I&J is proud of that and feels that it is to support small businesses.
I&J agree that the study should be independent, and it should not be industry-led. All I&J asks is that it is deep and fact-based, and that it has rigour, which Mr Jankovich trusts the Department will apply its resources and minds to that. On funding the Department, or supporting the Department, I&J has good examples of doing that already. It is for the Department to answer on those examples, and “not for [I&J] to brag about that”. I&J does accept the funding.
[Ms Winkler wrote in the chat box: Warming waters can affect fish stocks. If we don’t keep warming below 1.5 degrees, this will have a massive impact on fish species and marine life. This does not depend on sustainable management.]
Mr Jankovich responded to the question on environmental protection: I&J and other fishing companies are members of the RFA, led by WWF. It is “an incredibly strict alliance”, and members signed a code of conduct, and there are rules, regulations and governance that apply to that alliance. As Mr Ratheb mentioned, bird mortality reduction is one example, but members have a number of obligations, including monitoring bycatch species; the latter is linked to the South African Sustainable Seafood Initiative (SASSI) accreditation. SASSI has a system of listing species as green, amber or red). I&J signed an agreement with WWF’s SASSI that it will not trade any red-listed species. I&J has had the contract with WWF for close to ten years. “We all take environmental issues incredibly seriously”. It is important for the industry to do that because the ocean supports its businesses, and the lives of its employees and stakeholders.
On MPAs, those are specific, those are ring-fenced; all of the vessels have those ring-fenced areas on their radar systems. The vessels know where they are at sea, and I&J tracks and monitors vessels; every 30 seconds, it gets a ping from a vessel to know exactly where it is, how fast it is going, and whether it is fishing. I&J polices where vessels go both on shore and at sea.
Regarding further information, I&J would be happy to answer queries; Mr Jankovich thought that this was a “wonderful opportunity” for the industry to engage with the PC, and he apologised that it had not been able to do that before. He hoped that engagement could happen again, hopefully face-to-face.
The Chairperson said that the PC had run out of time; he had wanted Premier Fishing and African Pioneer to say something; if they could take one minute each, he would be happy with that.
[Mr Desmond D'Sa, KwaZulu-Natal Subsistence Fisherfolk Forum (KZNSFF), wrote in the chat box: In regard to the scientific studies, the scientist and the NGO WWF have never consulted any other groups of fisherfolks in regard to fish stocks. They have a bias towards the commercial fishing boats and companies.]
Ms Isaacs responded to questions. Premier Fishing is slightly different to its colleagues in terms of TAC. It has a basket of diverse products, from lobster, squid, hake, to horse mackerel and pelagic fish. Its allocations in these sectors are from small to medium in comparison to the TAC. The only large-scale sector that Premier Fishing is prevalent in is the South Coast Rock Lobster sector. With regards to quota cuts, it will impact Premier Fishing quite severely if it gets further reductions in these sectors.
On sustainable fishing, that is vital to Premier Fishing’s business. It has trained all of its skippers in sustainable fishing and environmental impact. It also has solar panels at its aquaculture farm. It is looking at implementing wind turbines as well. It is well aware of global warming and the impact its business could potentially have. It is putting measures in place to mitigate its impact.
On rights holders, Premier Fishing has a team that supports small rights holders, not just contributing financially to assisting them but also educating them on how to manage their right as a business and to be sustainable. Premier Fishing is very involved in supporting the rights holders that it is involved with, especially in the lobster and abalone sectors.
Premier Fishing does not have any rights holders working for it and does not have anyone from within the Department working at the company. It agrees regarding supporting the Department in doing research. It also supports the Department through the development associations that it is involved in. It would welcome any further questions in writing posed to Premier Fishing outside of this forum, seeing that time is quite limited.
Mr Dondolo responded to questions. The fishing industry is a very responsible industry, and it fishes in the guidelines of the law. Everything that it is doing is compliant. He emphasised that Eyethu is in the Eastern Cape, and is in an area where it really needs support, job creation, etc., because most of the industry is concentrated in Cape Town. This is of paramount importance for the industry, he must say.
Ms Winkler asked if it was possible for each of the companies (the big ones especially) to submit how much they spend annually on corporate social responsibility, and on environmental protection and rehabilitation and initiatives?
The Chairperson said that if there are specific issues that the PC would want to follow up on, then it could do that by submitting questions to the companies. Otherwise, it had come to the end of the first item.
Mr Mohammed Riedau DeMaine, from the Eastern Cape, was representing most of the associations, such as the Eastern Cape Pelagic Association, Hake Longline Association, various national associations, and several scientific marine management working groups. He answered a question on why allocations are so biased towards the Western Cape, and why the Eastern Cape “does not really fish”. In his opinion, there is a problem with geographical allocations
Ms Winkler wanted to direct companies and the presenters to the chat box; there were questions there by Desmond D’Sa and other stakeholders that she thought were very important, and needed to be addressed. Perhaps those questions could be addressed via a written submission by the companies.
The Chairperson thanked the presenters. With any issues that the PC wanted to follow up on, it would do so. The PC was aware that there are big companies and small companies, and that it wants to see how all of this comes together. Critically, South Africa is a country that is confronted by challenges that requires it to re-energise the economy after the destruction of COVID-19. Coming together and talking about issues is always good, because if the PC does not know what is going on, it does not help anybody. He said that the PC had come to the end of the first session of the meeting, and would start the second session.
The small-scale fisher representatives introduced themselves. Those present included:
- Mr Desmond D’Sa from the KwaZulu-Natal Subsistence Fisher’s Forum (KZNSFF)
- Ms Solene Smit, Chairperson: Coastal Links Langebaan, and small-scale fisher
- Mr JP, KZNSFF
- Mr Lwando Mini, African Pioneer Group
- Mr Ntsindiso Nongcavu, Chairperson: Coastal Links Eastern Cape
- Mr Naseegh Jaffer, Masifundise.
The Chairperson welcomed the small-scale fishers and the Department. After the PC’s engagement with the small-scale fishers, it met with the Department. This is where the PC was supposed to come back to the fishers and give them feedback, but it agreed with the Department that the Department would come and make a presentation, in response to the issues that were raised in the meeting before the lockdown. It might be that the issues that were raised might not be remembered because of the passage of time. The PC agreed with the Department that it would update the report and give it to the PC. The meeting is focusing on feedback on the issues that were raised. The Department will take into account that it is now October; the original meeting was some time ago.
DEFF Fisheries Management Branch Responses to inputs made by smallscale and commercial stakeholders
Mr Ishaam Abader, Acting Director-General, DEFF, introduced the presentation and indicated that it would be the departmental response to inputs made by the small-scale fishers.
Ms Sue Middleton, Chief Director: Fisheries Operations Support, DEFF, presented. She was accompanied by three colleagues: Mr Belemane Semoli, Chief Director: Aquaculture and Economic Development, DEFF; Mr Saasa Pheeha, Acting Chief Director: Marine Resource Management, DEFF; and Mr Abongile Ngqongwa, Acting Director, Small-Scale Fisheries Management, DEFF.
Members of the small-scale fishing community made representation to the PC on 04 June 2020. Then, members of the commercial and aquaculture sector made representation to the PC on 17 June 2020. On 02 September 2020, the Fisheries Branch responded to all the issues raised by small-scale fishers, inland fishers and the aquaculture sector. The Department has been asked to re-present what it presented on 02 September. Although there were presentations done by Masifundise – Coastal Links – the artisanal fisher from KwaZulu-Natal amongst others, the Department has clustered the issues. Rather than responding to each individual presentation, the Department has clustered the issues and has made a response to those issues.
The issues were presented in a table alongside DEFF’s responses to the issues; the responses can be found in DEFF’s presentation.
- When is the Minister publishing the COVID-19 level 3 regulations?
- Request for the provisioning of PPE to small-scale fishers.
- Proper explaining of social distancing and lockdown regulations needs to take place to fishers as many are unfortunately illiterate.
- Pamphlets about COVID-19 regulations are in English and cannot be properly understood by Afrikaans speaking communities in the Northern Cape and the West Coast.
- Government has issued permits to some KwaZulu-Natal fishers, but only one permit for the whole cooperative, which goes to the Chairperson.
- The instruction is then the Chair must make photocopies for Members. Under lockdown these fishers cannot afford photocopies or access to such facilities.
- Support to small-scale fishers during lockdown.
- A request was made that the West Coast Rock Lobster season be extended to September due to the extension of the lockdown.
Legislation, Permitting and Rights
- Of the 22 600 people who applied to be small-scale fishers, only 43% received rights.
[Jackie Sunde, who works in support of small-scale fishing communities, wrote in the chat box: Regrettably because of historical exclusions and the uneven public participation process for the SSF (small-scale fishing) policy implementation, thousands of bona fide subsistence and small-scale fishers have been left out of the policy so when (the) COVID-19 lockdown started they were excluded from 'essential service' exemptions. This is particularly so for thousands of fishers in KZN but also the Eastern Cape.
The policy definition includes fishers who fish part time and seasonally - yet these fishers were not included in the final lists.
The 11 020 who have been recognised reflect possible less than 50% of the real number of small-scale, subsistence and artisanal traditional fishers.
On inland lack of formalisation: This is one of the factors that has contributed to the fatal shooting of a fisherman in iSimangaliso Wetland Park on 16 September by rangers. To date, no explanation for this killing of Celempilo Mdluli and the shooting of another fisher has been provided by the Department.]
- In KwaZulu-Natal licenses and fishing permits are not translated into isiZulu, which means that many fishers do not properly understand their permit conditions.
[Mr D’Sa wrote in the chat box: In KZN thousands of subsistence fisherfolks were locked out and were not allowed to ply their trade on livelihoods without any consultation with them. KZN subsistence fisherfolks were arrested, harassed and fined by the recreation beach inspectors, metro police and SAPS who were never informed but were directed by national government officials.]
[Dr Kira Erwin from the South Durban Community Environmental Alliance and working with the KZNSFF wrote: Dear Honourable Members and colleagues: thank you for the presentation. The attached research report on how the Small-scale Fishing policy in KwaZulu-Natal has not managed to address the continued exclusion of some fishers has relevance for these discussions. Please do read through the report, and we are happy to take any questions around this in this meeting, or at a later stage.]
- Rights of inland fishers.
- Inland Fishing Policy
[Ms Sunde wrote in the chat box: The fishers from the fishing community of Nibela had written to the Department on 08 May 2020 informing them that the rangers were harassing them and not letting them fish and had asked the Department to hold a high-level meeting with the iSimangaliso Wetland Park to discuss the rights that the Minister of Fisheries had given them. Sadly, on 16 September Celempilo Mdludi, who was fishing with two other fishers, was shot dead by rangers despite the fact that he was fishing in the water adjacent to the communal lands of his community of KwaNIbela.]
[JP, KZNSFF, wrote in the chat box: The Department does not recognise subsistence fisherfolks in KZN. No face masks or any interaction with regard to education on social distancing.]
[Ms Sunde wrote in the chat box: The KZN subsistence fishers have a long history of being excluded and not accommodated by the policy regime and the way that the KZN subsistence fisheries management unit treated them further excluded them.
- May officials from the sea and rescue services issue fishing permits and implement decisions for the Department?
- Institutional capacity needs to be built and small-scale fishers need to be optimally placed, and not remain at the bottom of the value chain.
- What has happened to the consultative advisory forum that was to be set up and who informs the Minister about the small-scale fisheries programme?
- Small-scale fishers have not received recognition under the MLRA.
- Small-scale fishers are recognized and subsistence fishers are not.
- Subsistence fishers need to be accommodated under the MLRA.
[Ms Sunde wrote: The SSF policy public participation process did not adequately reach out to the subsistence fishers in KZN and help them understand that they would be accommodated under the umbrella terms of small-scale.]
[Dr Erwin wrote in the chat box: Dear Honourable Members please do see the report attached earlier that outlines why some KZN fishers were pushed by a long history of exclusion and current processes that do not recognise cultural heritage or the nature of informal work, to purchase recreational license. This was not a volunteered move by fishers but a response to structural racism and exclusion in policy processes.]
[JP, KZNSSF, wrote in the chat box: With fishing being recognised as essential services as of level three, is it permissible to fish overnight considering the curfew?]
- We have a recent problem of battling to get snoek in the basket, as fishers say government is not coming to the table. This is a food source that can address hunger etc, but government does not recognise this (Masifundise).
- We have been around for 160 years and we have been subsistence fishers from generation to generation. Because the former US President George Bush thought poor people should not enter the harbour to fish (Durban harbour) [after 9/11], we took it to the courts – and although it took ten years, we won. We are now recognised as subsistence fishers by Transnet and allowed to fish on the Durban beach front, and have 12 000 members (Mr D’Sa – KwaZulu-Natal Subsistence Fisher’s Forum).
Access and Safety
- Fishers in eThekwini rely on public transport such as trains to access the coast - can government look at subsidizing their transport?
- According to Masifundise, fishers have been shot at and killed by park rangers when they try to access marine protected areas – Mr Jaffer did say that information would be provided to the PC..
- People living next to MPA’s cannot access them; even if their catch wanders into an MPA they cannot follow it because they will be fined.
[On shootings in MPAs, Ms Sunde said: Mr Celempilo Mdluli was shot and killed by rangers on 16 September 2020. The Minister has yet to even visit the family.]
Services of the Department
- Customer service personnel and fisheries officials are rude and do not accommodate small-scale fishers.
[JP, KZNSFF wrote on the chat box: A government notice dated 17 August 2020 re: Draft Amendments on the Aliwal Shoal Marine Protected Area. This was only sent to KZNSFF on 17 October 2020, leaving us with about a week to respond before deadline. Very poor communication process resulting in the department making biased decisions.]
[Ms Winkler wrote in the chat box: Can we get a list of fishing and no-fish MPAs, please?]
The Chairperson said that the approach that must be adopted is that this is information responding to questions raised. Now, the PC expects those who are representatives of the small-scale fishers to take this information to their organisations. Representatives might want to ask questions for clarity. That also applies to Members after the PC has heard comments from the small-scale fishers in terms of clarity. This is a response to the issues that were raised. Some might be outdated now.
[Ms Winkler wrote: I think the situation in KZN needs to be re-looked at.]
Mr Desmond D’Sa, KZNSFF, said that the organisation sent out a research report (Cast Out), which put the facts on the table. He hoped that all Members had received the report because it shows the discrimination, racism, and shortcomings in how people have been treated as fishers. KZNSFF has written many letters to the Department. It has captured those letters and it has exhibits of those letters. It has all the reports of all the engagements with the Department, including the Ministers (Mr Bheki Cele was the former Deputy Minister), and all the Ministers who visited KZNSFF in Durban regarding subsistence fishermen. The Chairperson will recall that this is from time immemorial; 160 years ago, when people were fishing as subsistence fishers, and up until 2014, people were still fishing as subsistence fishermen. In 2014, the port regulator in Durban launched a complaint about fishermen who were not allowed to fish because of 9/11. After 9/11, the port authorities took a decision to ban subsistence fishing in the port. Rod and reel fishers were banned but the authorities allowed the boats to fish in the harbour, and to fish outside the harbour. KZNSFF took the case to court, and won the case in 2014 that recognised subsistence fishermen in the Durban port as fishermen. Despite the fact that that happened, the same thing of discrimination happened, where the rich and the elites were given the opportunity to fish. The same thing happened during COVID-19; nobody knew about the policy that was removed from subsistence fishermen, until they were being harassed by the police, arrested and fined. Fishermen found that they were longer part of the policy.
Ezemvelo Wildlife, the recreation SAPS and Metro Police were part of the harassment that has affected fishermen in KZN. Today, there were presentations by commercial fishing companies that only employ 2 000 people. There are 25 000 people (of all races) that fish all along the coast, from Kosi Bay all the way to Umbumbulu, Port Shepstone, Umkomaas, Park Rynie, Durban, etc. That was seen during COVID-19, when there was so much unemployment, and also before that. “People turned to fishing in their thousands; we saw how people were taking resources from the sea and taking it home”. Operation Phakisa, the ocean economy, talks about a better life for ordinary people. “The sea belongs to us, the ordinary people of this country”. Why is it that the scientists are not talking to the ordinary fishermen, who are deprived of a livelihood, who are doing a job, who are taking food and placing it on the table for their families? Yet, the Department does not see those fishermen. It just takes away their licenses, does not consult with them, ignores them, and does not respond. The research report talks to all that and it gives evidence of why the Department failed to come back and give responses to the KwaZulu-Natal fishermen.
[JP KZNSSF wrote in the chat box: MPAs in KZN are more racially-based to protect the elite who own properties on the beach. Research was done with scientists sitting behind their computers in their offices. No interaction with fisherfolks on the ground. Yet we see boats coming close in shore and some divers having privileges to take anything in the same MPA.]
The Chairperson interjected to say that he asked for questions for clarity. What Mr D’Sa presented requires another response. With the feedback from the Department, there might be issues that representatives will not be able to engage with when they go back to their constituencies. That is why he said, “questions for clarity”, but otherwise the PC is noting the issues that are being raised; he just did not want the others who would follow Mr D’Sa to do the same. The PC did not have time as Members were going to the House at 14:00.
[Ms Winkler wrote in the chat box: Question: Why are sharks and sting rays allowed to be caught? What happens with them?]
[Ms Sunde wrote in the chat box: Regrettably this exclusion is continuing now. Both rural and urban bona fide fishers are being excluded. This is having huge impacts on people’s food security.]
[JP, KZNSSF wrote in the chat box: In KZN, protected species are only spawning and breeding near areas which have properties on the beach owned by the few elites.]
Mr Jaffer said that the small-scale fisher representatives would like to have a chance to go through the responses from the Department. Some of it is detailed; some of it needs some more reaction from the fishers’ side. It need not be a long time; it could be a week but not more than two weeks.
He also wanted to acknowledge the Chairperson’s earlier point that this (the issues raised) was long ago. A lot of issues that were raised then have been addressed; maybe not 100% to fishers’ satisfaction, but nobody can be 100% satisfied all the time. There was recently a meeting that the Department invited fishers to, and at that meeting a number of issues were raised. He clarified that he was not asking for snoek to be put in the basket, because he knew that it was in the basket. There was a big snoek run at the beginning of COVID-19; the proposal that people were making (including Masifundise) was that snoek should be put into the food parcels that Government is arranging with other partners. A point that needs to be reflected on substantially is that the co-ops are being organised as rights holders in the small-scale fishing sector. Masifundise raised the problem long ago that the co-operative as an entity alone is not best entity across the entire coastline, because it cannot work given that traditions and cultures, and local conditions are different. This is a big issue that does not come through in the Department’s response, and Masifundise is asking for that to be considered. Alongside that is also the point that despite the Department saying that it has had thorough consultations and roadshows to identify people and to get people to sign up as small-scale fishers, there are thousands of people that have been left out. There is something structural that is at fault; Masifundise has said that many times before, and that has not been addressed.
The Chairperson said that he agreed with Mr Jaffer; time to discuss the Department’s responses is needed. The report was to be given to the fishers. Fishers had asked questions for clarity, and he also asked Members for additional comments.
[Mr D’Sa wrote his comments in the chat box: We have never been invited by the Department in regard to the issues we raised about policy and legislation about subsistence fisherfolks.
Why, if thousands of people are fishing, will the Department not commit to working with organisations representing the poor such as subsistence (fishers)?]
[JP, KZNSFF wrote in the chat box: The Department must understand the history of subsistence fisherfolks from KZN dating back to the 1800s. It is a total racial attack to claim that subsistence fishing is no more recognised. We are not recreational fishers and don't fish for sport but to put food on our tables and sustain our living.]
Mr Abader said that he did not have any comments; he asked if Ms Middleton and other colleagues had comments in relation to what was said.
Ms Middleton said that the Department would not respond to Mr D’Sa’s input in this meeting. To Mr Jaffer, she said that she was sorry if she misunderstood the issue of snoek. She could report that the Linefish Association did make donations of snoek to West Coast communities, particularly to Lambert’s Bay and St Helena Bay, during the lockdown. The association also made donations to old-age institutions as well. Mr Jaffer raised the issue of co-ops in the meeting with the Department. Ms Middleton was on record to say that in terms of the Fisheries Branch’s programme, the Department is due to review the MLRA (Marine Living Resources Act) in its entirety, in 2021/2022 financial year. That is where the issue of definitions, including Mr D’Sa’s comments about subsistence fishers not being in the policy or the definition will be revisited. That is the opportunity for the Department to revisit both the legal entity and definitions. The Branch has committed itself to that process. For the rest of the issues, the Department will continue engaging regularly with the key stakeholders around the rollout and implementation of the small-scale fisheries policies.
[Ms Sunde wrote in the chat box: Please can the Department state how they continue to engage with the conservation authorities who manage the MPAs to ensure that the Department and the conservation authorities are on the same page with regard to respecting the rights of the SSF co-ops so that there is no more loss of life by fishers shot in cold blood by rangers. This killing is shocking but it is being ignored by the Department.]
[Mr D'Sa wrote in the chat-box: During COVID-19, the Department stated they cannot support the KZN subsistence fisherfolks because they cannot qualify. So, people were not allowed to fish and at the same time they were hungry.]
The Chairperson said that for the Members and the small-scale fishers, there was at least a document that they could take home and go through in their own time. If there is any feedback, then the parties can continue the discussions and on trying to improve what is being done. He thanked the participants, and apologised if he might have been “very tight” in terms of time. He knew that when everyone was together, everyone would want to speak. He thanked the MPs and representatives of the various organisations.
The meeting was adjourned.
- Cast out: The systematic exclusion of KwaZulu Natal Subsistence Fishers from fishing rights regime in South Africa Policy Research Report
- DEFF: Fisheries Manangement Branch Responses to Inputs Made By Small-Scale and Commercial Stakeholders
- Sea Harvest Corporation presentation
- Portfolio Committee: SMME & Commercial Fishing Companies - Soundprops Investments 1167 (Pty) Ltd
- Premier Fishing (PF) presentation
- Irvin & Johnson presentation
- African Pioneer Group presentation
- Oceana Group presentation
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