Download - Review of Fisheries Regulations 2008 Final August 2017€¦ · RFL Recreational Fishing Licence RIS Regulatory Impact Statement SIV Seafood Industry Victoria TAC Total Allowable Catch

ReviewofFisheries(Fees,RoyaltiesandLevies)

Regulations2008

PreparedbyFisheriesVictoria April2017

PublishedbytheDepartmentofEconomicDevelopment,Jobs,TransportandResources1SpringStreetMelbourne,Victoria3000,August2017©CopyrightStateGovernmentofVictoria2017Thispublicationiscopyright.NopartmaybereproducedbyanyprocessexceptinaccordancewithprovisionsoftheCopyrightAct1968.AuthorisedbytheVictorianGovernment,Melbourne.DisclaimerThispublicationmaybeofassistancetoyoubuttheStateofVictoriaanditsemployeesdonotguaranteethatthepublicationiswithoutflawofanykindoriswhollyappropriateforyourparticularpurposesandthereforedisclaimsallliabilityforanyerror,lossorotherconsequencewhichmayarisefromyourelyingonanyinformationinthispublication.Whileeveryefforthasbeenmadetoensurethecurrency,accuracyorcompletenessofthecontentweendeavourtokeepthecontentrelevantanduptodateandreservetherighttomakechangesasrequire.TheVictorianGovernment,authorsandpresentersdonotacceptanyliabilitytoanypersonfortheinformation(ortheuseoftheinformation)whichisprovidedorreferredtointhereport.ThisreportwaspreparedfortheDepartmentofEconomicDevelopment,Jobs,TransportandResourcesbyRegulatoryImpactSolutionsPtyLtd.

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ReviewofFisheries(Fees,RoyaltiesandLevies)Regulations2008

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TableofContents

Glossary............................................................................................................................2

Background.......................................................................................................................3

Currentfees,royaltiesandleviesandtheirintendedpurpose...........................................4RecreationalFishingLicences(RFLs)...........................................................................................4Commercialleviesforfisheriesservices......................................................................................4Transactionfees.........................................................................................................................6Abaloneroyalty..........................................................................................................................7

Scope,methodologyandconcepts....................................................................................8Scope.........................................................................................................................................8Methods..................................................................................................................................10Concepts..................................................................................................................................10

CostRecovery..............................................................................................................................10Royalties......................................................................................................................................11Optimalpriceforrecreationalfishinglicence.............................................................................12

Findings...........................................................................................................................14Recreationalfishinglicence......................................................................................................14Commercialfisherieslevies......................................................................................................18Royalty(abalonequotaunits)..................................................................................................20Transactionalfees....................................................................................................................22

Conclusions.....................................................................................................................24

Appendices.....................................................................................................................25AppendixA:Currentcommerciallevies....................................................................................26AppendixB:RFLSurveyResults................................................................................................29AppendixC:Interstatecomparison–transactionfees..............................................................38


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Glossary

FCRSC FisheriesCostRecoveryStandingCommittee

FRDC FisheriesResearchandDevelopmentCorporation

GVP GrossValueProduction

RFL RecreationalFishingLicence

RIS RegulatoryImpactStatement

SIV SeafoodIndustryVictoria

TAC TotalAllowableCatch

VFA VictorianFisheriesAuthority

Notice

ThisreportwasoriginallypreparedbyFisheriesVictoriainApril2017.ItisbeingpublishedbytheDepartmentofEconomicDevelopment,Jobs,TransportandResourcesinAugust2017toassiststakeholdersinprovidingfeedbackontheproposedFisheries(Fees,RoyaltiesandLevies)Regulations2017.Since1July2017,FisheriesVictorianolongerexistsasapartoftheDepartment,andregulatoryfunctionsandadministrationoffisheriestransferredtoanewindependentstatutoryauthority,theVictorianFisheriesAuthority.ReferencesinthisreporttoFisheriesVictoriashouldbereadinlightoftheestablishmentoftheAuthority.


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Background

TheMinisterforAgricultureisresponsibleforthefisheriesportfolio.FisheriesVictoria,adivisionoftheDepartmentofEconomicDevelopment,Jobs,TransportandResources(“theDepartment”),isresponsiblefortheadministrationoftheFisheriesAct1995(“theAct”)anditsregulations(FisheriesRegulations2009andFisheries(Fees,RoyaltiesandLevies)Regulations2008).From1July2017,thisresponsibilitywillpasstotheVictorianFisheriesAuthority.TheActestablishesamodernlegislativeframeworkfortheregulation,managementandconservationofVictoria’sfisheries.TheActaimsto:• provideforthemanagement,developmentanduseofVictoria'sfisheries,aquaculture

industriesandassociatedaquaticbiologicalresourcesinanefficient,effectiveandecologicallysustainablemanner

• protectandconservefisheriesresources,habitatsandecosystemsincludingthemaintenanceofaquaticecologicalprocessesandgeneticdiversity

• promotesustainablecommercialfishingandviableaquacultureindustriesandqualityrecreationalfishingopportunitiesforthebenefitofpresentandfuturegenerations

• facilitateaccesstofisheriesresourcesforcommercial,recreational,traditionalandnon-consumptiveuses

• promotethecommercialfishingindustryandtofacilitatetherationalisationandrestructuringoftheindustry

• encouragetheparticipationofresourceusersandthecommunityinfisheriesmanagement.

TheFisheries(Fees,RoyaltiesandLevies)Regulations2008(“theRegulations”)aremadeundertheAct.Theyprescribethefees,royaltiesandleviespayableinrespecttocommercialandrecreationalfishinglicences,quotaunits,permitsandcommercialfishingboatregistrations.TheRegulationsapplytofishingandrelatedactivitiesinVictorianwaterways.1Victoriahasover2,000kilometresofcoastadjacenttoopencoastalwaters,baysandestuaries.InlandVictoriafeaturesthousandsofkilometresofriversandstreamsaswellasalargenumberoflakesandimpoundments.Theseaquaticenvironmentssupporthundredsofdifferentspeciesoffish,molluscs,crustaceansandotheraquaticinvertebrates.TheRegulationsarescheduledtosunseton30January2018andthereforeneedtoberemadebythatdateinordertocontinuetocollectrevenue.TheremakingprocesswillinvolvepreparationofaRegulatoryImpactStatement(RIS)forpublicconsultation.TheVictorianGuidetoRegulationrequiresthatforremakingofsunsettingregulations,anevaluationofthecurrentRegulationsisrequiredtoinformthedepartment’sviewsonwhethertheRegulationsneedtoberemade,alternativeoptionsthatcouldbeconsidered,andtheanalysisofthoseoptions.ThepresentreviewfulfilsthatrequirementandhasbeenundertakenbyFisheriesVictoria.

1WithinAustralia,eachstateisresponsibleforfisherieswithinitsinternalwaters(whichincluderiver,lakeandestuarinefisheries)aswellasfisheriesadjacenttoitscoastlinewithinthreenauticalmiles.


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Currentfees,royaltiesandleviesandtheirintendedpurpose

RecreationalFishingLicences(RFLs)ThecurrentRFLpricesareasfollows:

Fee Pricein2016-17 Previousprice3-daylicence $10 $6*28-daylicence $20 $121-yearlicence(online) $33 N/A1-yearlicence(agent) $35 $24.503-yearlicence(online) $90 N/A3-yearlicence(agent) $95 $66Grouplicence $35 $24.50

*$6fortheprevious2-daylicence.

Allpriceswereincreasedfrom1July2016,andadiscountintroducedforonlinesales(1-and3-yearlicencesonly).Withtheexceptionofthe3-daylicence,pricesarescheduledtoconverttofeeunitsfrom1July2017andtobeindexedannuallythereafter.The3-daylicencewillremainat$10from1July2017.ThepurposeofRFLsistoprovideamechanismforrecreationalfisherstomakeacontributiontothecostsofsupportingrecreationalfishingopportunitiesinVictoria.ThisisachievedthroughtheestablishmentoftheRFLTrustAccount,intowhichallRFLfeesarepaid.UndertheAct,moneyintheTrustAccountcanonlybeusedforthepurposeofimprovingrecreationalfishing,whichincludescoveringsomecostsandexpensesincurredintheadministrationofRFLsandtheTrustAccount.TheJuly2016increasestoRFLpricesaimedtogeneratearound$10.4millioninrevenuein2016-17and$11.0millionin2017-18,whileminimisinganynegativeimpactofthefeeincreasesonfishingparticipation.Thechangeswereexpectedtoresultinsomeshiftsbetweenlicencetypes,particularlywiththeintroductionofthe3-daylicence.Three-daylicencesreplacedtheformer2-daylicencetobettermatchlikelyfishingpatterns,particularlyoverlongweekends.Adiscountedpriceforonlinepurchases(for1and3-yearlicences)wasintroducedtoencouragemorepurchasesonline.CommercialleviesforfisheriesservicesAsrequiredbytheAct,thetotalchargespayablebylicenceholdersaremadeupofseparateleviesinthefollowingcategories:fisheriesmanagement,compliance,research,andadministration.ThecurrentleviesaresetoutinAppendixA.ThelevieshavebeenamendednumeroustimessincethecommencementofthecurrentRegulationsin2008.Until2013,thesechangesactedtoreducelevieswherecostswereknowntobelowerthantheleviesbeingcollected,butlevieswerenotincreasedwherecostswerefoundtobehigher.In2013,levieswereincreasedby30percentasafirststeptowardsfullerrecoveryofcosts.In2013-14,alllevieswerecomprehensivelyreviewedtore-aligntheleviestothecostsoftherespectiveservices.Thisreviewalsotookaccountofimproveddatasourcestoinformhowtotalgovernmentcostsshouldbeallocatedbetweenfisheries.Thechangesin2013-14


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involveddecreasestosomeleviesandincreasestosomelevies,withanoverallincreaseintotallevyrevenue.However,toassistadjustmenttohigherlevies,increaseswerephasedinoverthreeyears,withtheintendedleviestotakefulleffectfrom2016-17.Thechangesalsoremovedalargeamountofcross-subsidisationbetweenfisheriesthatwasoccurring(i.e.,somefisherieswerepayingleviesinexcessofthecostofservicesreceived).Theleviesaimtorecoverthecostsincurredbygovernmentinprovidingtherelevantservices(referredtointheRegulationsasfisheriesservices).Thecurrentleviesarenotintendedtorecoverthefullcostofservices.Intheregulatoryimpactstatementpreparedforthe2013-14changestolevies,itwasestimatedthatthenewlevieswouldrecoveraround$4millionby2016-17,oraround80percentoftheestimated$5.1millionofcostscategorisedas“recoverable”fromthecommercialfishingsector.The“recoverable”costsalreadyexcludedaround$24.6millionincostsrelatedtothemanagementofcommercialfisheriesbutthatwereconsiderednotappropriateforcostrecovery(e.g.,policydevelopment,Ministerialsupportandfunctions,surveillanceandinspectionofunlicensedfishing).Theseadjustmentsweremadetorecognisethattheprovisionoffisheriesservices,aspartofoverallsoundmanagementofthestate’sfisheriesresources,hassomepublicgoodelementsandbroaderbenefittothecommunity(e.g.,makingdecisionsaboutallowablecatchtomeetenvironmentalobjectives;protectingthevalueoftheassetsfromwhichtheStatecangenerateabenefit),andactivitiesthatwouldbeundertakenbythegovernmenteveniftherewerenocommerciallicences(e.g.,monitoringecosystemhealth,actionstopreventunauthorisedtakingoffish).Thegapbetweenthe“recoverable”costsandtheactualrevenueexpectedreflectedapolicydecisiontocollectlessrevenueinanumberofspecificareas.These“concessions”were:• Nilcostrecoveryforsurveillance,intelligence,investigationsandprosecutionsin

relationtoallcommerciallicenseesandquotaunitholders• Reducedcostrecoveryforcatchandeffort(setat65percentofcosts)• Nilcostrecoveryforpreparationoffisherymanagementplans• Reducedattributionofcoststofinfishfisheries• Levycapforsmalloperators.Someoftheseitemsreflectedconcernbyindustryaboutthelevelofcosts,withtheconcessionsprovidinganopportunitytoexplorescopeforreductioninthecostofservicesunderthenewprospectivesystem.Thesmalloperatorconcessionacknowledgedthatsomefisherieshadalowcapacitytopaythefulllevy.Atthetimeoftheregulatoryimpactstatement,thevalue(i.e.,forgonerevenue)oftheconcessionswasexpectedtobearound$1millionperannum.Thefollowingtableshowsthereconciliationofthesecostsasmodelledin2013-14:Costs Amountin

2013-14Projectedamountfor2016-17

Totalcostsofmanagingcommercialfisheries $26.9m $29.7mLess:excludedcoststhatrelatetowiderbenefits -$22.2m -$24.6mCosts“recoverable”fromcommercialfisheries $4.7m $5.1mLess:“concessions” -$0.9m -$1.05mExpectedlevyrevenue $3.8m $4.05m


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Thisshowsthattheproportionofcostrecovery(expectedrevenueasapercentageofthe“recoverable”costs)wasaround80percent.Asapercentageoftotalcostsrelatedtofisheriesmanagement,thelevieswereexpectedtorecoveraround13percentby2016-17,upfromaround9percentin2012-13.Therehavebeenanumberoffurtheramendmentstotheleviessincethe2013-14changes.Thesehavebeenprincipallytoadjustleviestotakeaccountofchangesinthenumberoflicences(sothatcostsremaindistributedamonglicenceholders)aswellasmaterialreductionsinthecostofsomeactivities.

TransactionfeesThecurrentfeesareasfollows:Fee Feeunits Feevalue2016-17Generalpermit 10.5 $146.37Generalpermit(developingfishery) 27.8 $387.53Variationofgeneralpermit 10.5 $146.37Protectedaquaticbiotapermit 10.5 $146.37Variationtoprotectedaquaticbiotapermit 10.5 $146.37Fishingboatregistration 3.6 $50.18Fishingboatregistrationrenewal 3.6 $50.18Fishingboatregistrationtransfer 3.6 $50.18Commercialfisheryapplicationfee(aquaculture–Crownlandandon-shore)

120.6 $1,681.16

Commercialfisheryapplicationfee(abaloneaccesslicence,fishreceivers’(abalone),aquacultureprivateland)

27.8 $387.53

Commercialfisheryapplication-FishReceivers'(Scallop)Licence

18.9 $263.47

Commercialfisheryapplicationfee(allothers) 18.5 $257.89Licencefeeforissueorrenewalofcommercialfisherylicences

3.6 $50.18

Transferofcommercialfisherylicence(aquaculture) 18.9 $263.47Transferofcommercialfisherylicence(abaloneaccess)

27.8 $387.53

Transferofcommercialfisherylicence(other) 18.5 $257.89Transferofindividualquotaunits(abalone) 27.8 $387.53Transferofindividualquotaunits(other) 3.6 $50.18Variationofcommercialfisherylicence 3.6 $50.18Abalonequotaunitholdingstatement 3.6 $50.18Notificationbyholderofabaloneaccesslicence 3.6 $50.18

Thetransactionfeeswerelastreviewedin2007.Thefeesweresettorecovertheactualefficientcoststothedepartmentassociatedwitheachtransactionprocessed.Giventhesmallamountofrevenueinvolvedinthesefees,andsomebeingusedinfrequently,therewaslimitedexaminationofcostsinthe2007RIS,withmostofthesefeescontinuingattheratepriortothecurrentRegulations.Thesefeeshavenotbeenchanged(intermsoffeeunits)since2008.


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AbaloneroyaltyTheActallowsroyaltiestobesetforanyfisherylicenceorpermitissuedundertheAct.However,onlyabalonequotaunitshavebeensubjecttoroyaltiesinVictoria.Royaltiesarebasedonindividualquotaunits.Theroyaltypayableinrespectofanabalonequotaunitis7.2percentofGVP2,lessanycostrecoveryleviesforservicesprovidedandlesstheFRDClevy.Thepurposeoftheroyaltyistocapturesomeofthevaluegeneratedbythefishery,representingthelostvaluetothecommunityofhavingtheresourcetaken.Inpractice,royaltiesareaimedatrecoveringareasonableshareofthehighprofitabilityofthesector.TheabalonefisheryisoneofVictoria'smostvaluablecommercialfisheries:almostallofthecatchisexportedtointernationalmarkets,predominatelyinAsia.AbalonearecaughtalongmostoftheVictoriancoastlineandthefisheryisprimarilybasedonblacklipabalone,thoughgreenlipabalonearealsosought.Thefisheryisquotamanaged,withatotalallowablecommercialcatchsetannuallybasedontheoutcomesofastockassessmentprocess.Inpractice,itisdifficulttodeterminethecorrectroyaltyamountintheabsenceofacompetitivemarketforquotaunitsordetailedknowledgeoffishers’profitability.Therateoftheroyaltywasdevelopedasarateacceptabletobothgovernmentandindustry.MorerecentlytheAbaloneIndustryCommittee(asubcommitteeofSeafoodIndustryVictoria)hassoughtloweringorremovaloftheroyalty.Thecurrentformulausedtocalculatetheroyaltypaymentmayresultina“negativeroyalty”.Thatis,wherethecombinedamountofthefisheriesservicesleviesandtheFRDClevyismorethan7.2percentofGVP(fortheindividualabalonefishery),thereisnoadditionalroyaltypayableandtheamounttobepaidfortheleviesisreducedsuchthatonly7.2percentofGVPispaidintotal.

2GVPbeingtheaverageweightedbeachpriceperkilogramofabalonemultipliedbytheweightofabaloneinkilogramsallocatedtotheindividualabalonequotaunitinthequotaperiodtowhichtheroyaltyrelates.


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Scope,methodologyandconcepts

Scope

Theprincipalquestionofthereviewiswhetherthecurrentfees,royaltiesandlevies(collectivelyreferredtoas‘charges’)areachievingwhatwasintended,intermsofboththelevelsofcostrecoveryandthepolicyobjectivesofthelicensingsystem.BecausethereviewisapreliminaryactivityintheremakingoftheFees,RoyaltiesandLeviesRegulations,itislimitedtoreviewingonlythecontentoftheseRegulations.MatterscoveredintheAct,otherregulations,andvarioussubsidiaryinstruments(suchasmanagementplans)arenotwithinthescopeofthereview.ThechargesincludedintheRegulationsapplytodifferentlicences,quotaunits,permitsandregistrationsasfollows:Licencetype ChargesapplicableCommercialfisheryentitlements(comprisingAccess(wild-catch)Licences,QuotaUnits,AquacultureLicencesandFishReceivers’Licences)

Theselicencesarerequiredinordertotakeorproducefishforsale.Accesslicencesarerequiredinordertotakecommercialquantitiesoffishfromthewild.AbaloneQuotaUnitsgoverntheamountofabalonethatcanbetakenunderaquotamanagementregime.Aquaculturelicencesauthorisethecommercialproductionoffish.FishReceivers’licencesauthorisethereceivingofabaloneandscallopsfromAccesslicenceholders.Thechargestructureinvolves:• anapplicationfeewhenseekingalicence,torecover

costsrelatedtoassessingthesuitabilityofanapplication

• alicencefeefortheissueorrenewalofalicence.Thelicenceissuefeeisanadministrativecostassociatedwiththeprocessesofissuingofalicence.(Thecostsrelatetoreceiptingrevenue,processingtherenewalonthedatabase,laminatingthelicenceanddespatchingthelicencetotheholder.)Licencesarerenewableundertheprovisionsofsection57oftheFisheriesAct1995

• annualleviestofundthecostoffisheriesservicesprovidedtooronbehalfofthesector

• anannualroyalty(abalonequotaunitsonly)• afeetovaryalicence• afeetotransferalicence(notalllicencesare

transferable).Recreationalfishinglicences Peopleover18andnototherwiseexemptarerequiredto

holdarecreationalfishinglicence(RFL)inordertorecreationallyfishinVictorianwaters.RFLscanbepurchasedonlineoratanauthorisedretailagent.Licencescanbepurchasedforoneoffourdurations:3days,28days,1yearand3years.


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Licencetype ChargesapplicableGeneralpermits Generalpermitsareissuedtoapplicantswhowishto

undertakefishingactivitiesthatarenotauthorisedunderrecreationalfishingregulationsorcommercialfishingauthorisations.Thismayincludeactivitiessuchasfisheryresearchwherecommercialfishingequipmentisusedtocollectfishbypersonswhodonothaveacommerciallicence.Permitsareissuedonanasneedsbasis.Approximately250permitsareissuedannually.Thefeestructureinvolvesafeeforapplyingforthepermitandafeeforavariation.

Fishingboatregistration FishingboatsneedtoberegisteredundertheprovisionsoftheFisheriesAct1995(seesection114)iftheyareusedincommercialfishingactivities.Approximately450commercialfishingboatsareregisteredinVictoriaeachyear.Thefeestructureinvolvesfeesforinitialregistration,renewalandtransfer.

Holdingstatement Aholdingstatementprovidestherecipient(operator)withastatementofquotabalanceatthetimethestatementisprovided.

ThereisoverlapinhowthecurrentRegulationsoperatewithotherregulations.Forexample,whilethecurrentRegulationscollectrevenuefromrecreationalfisherstopayintotheRFLTrustAccount,itisdifferentregulations(theFisheriesRegulations2009)thatdefinetheclassesoflicencesandexemptions,whichinturnaffectsthepeoplefromwhichapricecanbecharged.ThisreviewislimitedtotheoperationofthecurrentRegulationsonly.TheAct,the2009Regulations,managementplansandlicenceconditionsareoutsidethescopeofthisreview.ThisreviewdoesnotexamineleviesrelatingtotheFisheriesResearchandDevelopmentCorporation(FRDC)orpeakbodies.ThoseleviesareincludedintheRegulationsbutarecollectedonbehalfoftherelevantbodiesonasimple‘passthrough’basis.TheFRDCisacorporationcreatedunderCommonwealthGovernmentlegislation.TheCommonwealthGovernmentexpectscommercialfisherstocontributedtoresearchfunding.Formanyyears,commercialfishershavecontributedtotheFRDCatarateof0.25percentofGVPperannum.TheStateGovernmentcollectsthelevyonbehalfofVictoria’scommercialfishersandtransferstheamounttotheCommonwealth.FundscollectedfromcommercialfishersbytheFRDCarethenmatchedbytheCommonwealth.SeafoodIndustryVictoria(SIV)andotherrepresentativebodies(i.e.WesternAbaloneDivers’AssociationandAbaloneVictoriaCentralZone)haveagreementswiththeStateGovernmenttocollectleviesfromtherelevantfishersandtograntthosemoniesbacktothenominatedrepresentativebodiesfortheiroperation(subjecttothebodiesmeetingkeyperformancecriteria,includingappropriateuseofthefunds).ThereisnocompulsionfortheStatetoundertakethisactivity.However,thecollectionofthelevyamountsundertheRegulationsgiveslegalforcetothelevies.Thisbenefitstheorganisationsbycompellingallrelevantfisherstocontribute(theywouldbeunlikelytodosootherwise).Inthesettingof


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thelevyamount,theStatewouldtakeadvicefromtherepresentativebodies.(Thoselevieshavenotbeenchangedformanyyears.)MethodsThisreviewhasdrawnonarangeofanalyses.ForeachofthechargesincludedinthecurrentRegulations,thereviewsoughttodeterminewhethertheywereoperatingasintended,whethertherewereanyunexpectedorundesirableconsequences,andwhethertherewasanopportunitytoimprovehowthecurrentarrangementswereoperating.Toinformtheseconclusions,FisheriesVictoriadrewondataincluding:• detailedsalesdataofrecreationalfishinglicences,purchasedonlineandthroughretail

agents,overthepasttenyears.Aparticularfocuswasonchangestothenumberandtypeoflicencespurchasedinresponsetothe2016pricechanges,comparedtotheexpectedchangesbasedonmodellingundertakenin2016

• atargetedsurveyofalargesampleofrecreationalfishers–duringMarchandApril2017,asurveywasconductedofRFLholderswhohadpurchasedalicencesince1July2016,togatherinformationonchangedbehaviourinresponsetothepricechanges,attitudestotheRFLprices,andwillingnesstopay.SeefurtherdetailaboutthesurveyinAppendixBtothisreport

• thegovernment’sdataonthecostsofprovidingfisheriesservicesaspartofthemanagementofthestate’sfishresources,andthecostsofothertransactions

• inputfromfisheriesofficersoncompliancewith,andadministrationof,thecurrentarrangements

• datafromotherstateswherebenchmarkingofcostsmaybeappropriate• feedbackfromstakeholdersreceivedthroughthedepartment’sexistingconsultation

channels,andpreviousfeedbackfromearlierregulatoryimpactstatementprocesses.ConceptsCostRecovery

TheFisheriesServicesleviesandthetransactionfeespaidbycommerciallicenceholdersarebasedonthegovernmentpolicyofcostrecovery.Traditionally,mostgovernmentactivitieswerefundedfromgeneraltaxationrevenue.Withadesiretoimproveefficiency,transparencyandequity,however,governmentshaveincreasinglyrecoveredsomeorallofthecostsofvariousactivitiesbymoredirectmeans.Costrecoverymaybedefinedastherecuperationofthecostsofgovernment-providedorfundedproducts,servicesoractivitiesthat,atleastinpart,provideprivatebenefitstoindividuals,entitiesorgroups,orreflectthecoststheiractionsimpose.Costrecoveryinvolvessettingandcollectingchargestocoverthecostsincurredinundertakingactivitiessuchas:• theprovisionbygovernmentofcertaingoodsandservicespurchasedbycustomers(e.g.

FreedomofInformationrequests,titlesearches)• theadministrationofregulation(e.g.registration,licensing,issuingofpermits,

monitoringcompliance,investigations,enforcementactivity)• governmentmeasuresinnatural-resource-basedsectors(suchasforestry,mineralsand

petroleum,andland-basedindustriessuchasagriculture)andecologicalservices


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(includingwildlifehabitatandfoodsources,soilconservation,watercatchmentprotection,cleanerair,andrecreationalservices).

Thecostsoftheseactivitiesneedtoberecoveredinsomeway–eitherfromusersorotherswhobenefitfromthegood,serviceoractivity;thosewhoseactionsgiverisetothecosts;orfromtaxpayersmoregenerally.Typically,the‘beneficiarypays’approachcanbeusedtoidentifywhoshouldpayfortheprovisionofgovernmentgoodsandservices.Underthisapproach,privatepartiesshould,ingeneral,meettheirshareofthecostsofprovidinggoodsandservicesthatconferprivatebenefits.Commensurately,costrecoverychargesshouldnotbeappliedtocostsincurredbytheGovernmentinfulfillingpublicpurposesandprovidingpublicgoodsandservices.ItisVictorianGovernmentpolicythatcostrecoverythroughfeesoccursonthebasisofauser-payssystem,wherebythosewhoutiliseservicesshouldbeobligedtopayforthecostofthoseservices,ratherthanhavingthemfundedfromgeneraltaxationrevenues.Fullcostrecoverypromotestheefficientallocationofresourcesbysendingtheappropriatepricesignalsaboutthevalueofalltheresourcesbeingusedintheprovisionofgovernmentgoods,servicesand/orregulatoryactivities.Further,fromahorizontalequitypointofview,fullcostrecoveryensuresthatthosewhohavebenefitedfromgovernment-providedgoodsandservices,orthosewhogiverisetotheneedforgovernmentregulation,paytheassociatedcost.Underthisapproach,thosepartieswhodonotbenefitortakepartinaregulatedactivitydonothavetobearthecosts.Therearethreeimportantconsiderationsindeterminingthe‘fullcost’offeesandcharges:1. Theserviceoractivitybeingprovidedbygovernmentshouldbenecessary.2. Theservicesshouldbedeliveredasefficientlyaspossible.3. Thecostsincludedshouldonlybethosethatcorrespondtogivingprivatebenefits.Further,theremaybeotherreasonswhychargesdonotreflectthefullcost.Thesemayincludematterssuchasabilitytopay(equity),orundesiredimpactsonotherpolicyobjectives(e.g.,non-compliance).

Royalties

Royaltiesdifferinseveralrespectsfromcost-recovery-basedcharges.Importantly,royaltiesdonotseektorecoveractualcostsincurredbygovernment.Instead,theyarebasedonthepublicvalueoffisheriesresources.Asfisheriesareapublicallyownedresource,andfishersaccessfisheriesforprivategain,royaltiesallowgovernmentstocapturesome(orall)ofthisvalueonbehalfofthepublic.Inessence,aroyaltyseekstorecoversomeofthevalueoftheresourcetakenbythelicensees.Settingtherightroyaltyamountassistsinensuringthatresourcesareusedefficiently,i.e.,inawaythatprovidesgreatestbenefittothecommunityasawhole.The‘right’royaltyamountshouldthereforereflecttheopportunitycosttothecommunityofallowingtheresourcetobetaken.Theopportunitycostisthenextbestbenefitthatcouldbeachieved.Ifanappropriateroyaltycouldbeset,normalmarket-basedbehaviouroffisherswouldproduceanefficientindustry.Fisherswouldchoosethefishingmethod,andwhereandwhentheyfished.Specifically,theroyaltywouldreflectthemarketconditionsthatprevailedfortheuseofthenaturalresourcesforwhichcompletepropertyrightsexisted.However,inpracticetheefficacyofroyaltiesislimitedwherethereareincompletemarkets.


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Royalties,orothermeansofextractinga‘resourcerent’,arecurrentlynotusedinAustralianfisheries,withtheexceptionoftheabalonefisheryinVictoria(wherearoyaltyisused),andarenotcommonpracticeworldwide.ThegovernmentofWesternAustraliachargesleviesthatarecalculatedasapercentageofGVP;however,thepurposeofthesechargesistorecovergovernmentcostsandnotactasatrueroyalty.Itisnotproposedtoextendroyaltyarrangementstoanyotherfishery.TheProductivityCommission’sreportMarineFisheriesandAquaculturenotedthatmanycommercialfishingoperationsaremarginal,anditisunlikelythattheywouldearnconsistentsurplusvaluethatcouldbeextractedbyroyaltycharges.TheProductivityCommissionalsocitedchallengesassociatedwithcalculatinganaccuratecharge.Optimalpriceforrecreationalfishinglicence

TheFisheriesActrequiresthatallRFLsalesrevenueisdepositedintoaTrustAccount,whichcanonlybeusedforthepurposeofimprovingrecreationalfishing.TheTrustAccountisusedforfundingprojectsandinitiativesthatfacilitaterecreationalfishing,suchasimprovingaccess,andfishstocking.Thesearethingsthatrequirecentralcoordinationtofund(andoftenprovide)becauseindividualfishersarenotabletodothemalone,orwouldhaveanincentiveto‘freeride’onothers(i.e.,tousethebenefitofthingspaidforbyothers).ThetypesofthingsfundedthroughtheTrustAccountareknownas“publicgoods”.Intheabsenceofanylicensingofrecreationalfishing,projectsandinitiativesthatbenefitrecreationalfishingwouldnotbedoneunlessfundedbythegovernment.However,onceprovidedbygovernment(paidforbyalltaxpayers),itisdifficulttolimithowmuchpeopleusethegoodsandservices.Whilethebeneficiariesaregenerallylimitedtothoselikelytoparticipateinrecreationalfishing,therewouldbedemandforfundingtheseselectivepublicgoodshigherthantheoptimallevel.Thewell-establishedpolicysolutiontothisproblemistorequirepeoplewithinthegroupofbeneficiariestomakeacompulsorycontributiontothecostofthepublicgoods.Onlythosethatmakethecontributionmayusethepublicgoods;theenforcementofthecontributionnecessitatestheuseoflicencestocontrolwhomayusethepublicgoods.Thisensuresthatthecostofthepublicgoodsispaidforbythosethatusethemthroughthelicenceprice.Theoptimalamountofspendingonthesepublicgoodsisdeterminedbythewillingnessofthegroupofbeneficiatestopayforthegoods.Wherelicencepricesarebelowthewillingnessoffisherstopayforthepublicgoods,notenoughofthegoodswillbeprovided,andpricesshouldbeincreased.However,thereisadegreeofself-selectionwhensettinglicenceprices.Thereisnotauniformwillingnesstopayforallrecreationalfishers,butarangeofvalues.Therefore,evenatpricesbelowtheaveragewillingnesstopay,theremaybesomeindividualsforwhomthepriceisabovetheirwillingnesstopay.Itislikelythereforethatincreasingpricestowardstheaveragewillingnesstopaymayresultinafallinthenumberofpeoplebuyingalicence.Ontheotherhand,whiletotalrevenuefromlicencesisincreasing,theadditionalpublicgoodsabletobeprovidedislikelytoencouragemorepeopletowanttoparticipateinrecreationalfishing.Thenatureoftheprojectsfundedfromlicencerevenueisspecificallyaimedatimprovingaccessandopportunitiesforrecreationalfishing.Anincreaseinthelevelofpublicgoods(assumingtheystillmeetthisaim)ineffectinducesanincreasein


13

willingnesstopay,becausethereisgreaternetbenefitavailable.Thatsaid,ingeneral,anincreaseinthenumberofprojectsislikelytoshowdiminishingreturns–thatis,asthenumberofprojectsincreases,theaveragenetbenefitoftotalspendingwillfall.Fallingaveragebenefitsislikelytoresultinadecreaseinthewillingnesstopayforthoseadditionalprojects.Atsomepoint,anequilibriumexistsreachedbetweenwillingnesstopayandthelevelofpublicgoods.However,whilethismaybeoptimalineconomicterms,itmaynotbedesirable.Whenincreasinglicenceprices,atsomepointtherewillbeamaterialreductioninthenumberoflicencesbeingbought,andmayevenresultinlessrevenuecollectedoverall.Thismaytheoreticallybeamoreoptimaloutcome–theremainingrecreationalfishersstillenjoythepublicgoodswithintheirwillingnesstopay,andmayevenenjoythemmorebecausethereisfewerpeopletosharewith.Thisisnotdesirablefromapolicyperspectiveastheincreaseinbenefitswouldbeconcentratedinasmallergroupofpeople,andisinconsistentwiththepolicyobjectivetoincreaseparticipationinrecreationalfishing(whichhassignificanteconomicflow-onbenefits,particularlyinregionalareas).Therefore,theidealpricesforlicencesshouldincreaseuptothewillingnesstopay,butnotiftheadditionalprojectstobefundedbytheadditionalrevenuehaveamateriallylowernetbenefit,andnotiftheincreasedpricesresultinamaterialdecreaseinthenumberofpeoplefishingoradecreaseintotalrevenueavailable.


14

Findings

RecreationalfishinglicenceRFLsalesnumbersIntermsoflicencenumbers,inthesevenmonthstoJanuary2017,thetotalnumberoflicencespurchasedhasdecreasedby4.0percentcomparedtothesameperiodin2015-16.Thisreflects:• Adecreasein3-yearlicencesof16.8percent• Anincreasein1-yearlicencesof8.3percent• Adecreasein28-daylicencesof39.2percent• Adecreasein3-daylicences(comparedtotheprevious2-daylicences)of2.7percent.

However,someofthisdeclineislikelytobecausedbycyclesinlicencepurchases.Forexample,thereisa3-yearlycycleinthedistributionof3-yearlicences(duetotheirunevendistributionacrossyears).Thatcyclewouldalreadysuggestanexpecteddecreasein3-yearlicencesof26percentinthelatestyear.Aftercorrectingforthisbuyingcycle,theactualnumberoflicencesforthisperiodisonly1,402(0.7percent)lowerthanthesameperiodlastyear.Thissmalldecreasecanbeexplainedbyanumberoffactors,andinparticular:• asmallbutnoticeablebring-forwardofpurchasesof3-yearlicencesinJune2016tobuy

thelicencesbeforethepriceincreases.Thisisestimatedtobearound1,000-1,300licences.

• individualfisherswhopreviouslyboughtmultipleshort-termlicenceswithinayearshiftingtobuysinglelicences(1-yearor3-year)toachievebettervalueformoney.3

Onlyasmallnumber(between100and400)ofsuchachangewouldbeneededtoexplaintheremainderofthereductioninlicencenumbers.Asurveyofrecreationalfishersrevealed:

32-daylicenceswerepreviously24percentofthepriceofa1-yearlicence,butarenow30percent.

0

50,000

100,000

150,000

200,000

250,000

3yearRFL 1yearRFL 28dayRFL 2/3dayRFL Alllicences

RFLSales(Jul-Dec)

2012 2013 2014 2015 2016


15

• 57%ofpeoplewhopreviouslyboughta2-daylicencechangedtheirlicencetype,withmostofthese(48%)movingtoa1-yearlicence.Withsomesmallershiftstothenew3-daylicencefromotherlicencetypes,thetotalnumberof3-daylicencesfellby43%

• 60%ofpeoplewhopreviouslyboughta28-daylicencechangedtoanotherlicencetype,withmost(49%ofthe60%)shiftingtoa1-yearlicence.Withsomesmallershiftstoa28-daylicence,thenetresultwasadecreasein28-daylicencesof31%

• 22%ofpeoplewhopreviouslyboughta1-yearlicenceshiftedtootherlicencetypes(nearlyallto3-yearlicences),althoughthisismorethanoffsetbyshiftsfromotherlicencetypestothe1-yearlicence,givinganoverallincreaseof10%

• 33%ofpeoplewhopreviouslyboughta3-yearlicencechangedtootherlicencetypes,withnearlyallofthesemovingtoa1-yearlicence.Innetterms,3-yearlicencesincreasedby15%,reflectingshiftstoa3-yearlicence,mainlyfrom1-yearlicences

• 68%ofsurveyedfishersboughtthesamelicencetheyboughtpreviously.Iflessthan1percentofthepeopleshiftingfrom2-dayor28-daylicencestoa1-yearlicencepreviouslypurchasedtwolicenceswithinayear,thiswouldcoincidewithareductionintotallicencessoldof400(0.2percent).Thedepartmentexpectsthatchangesfrommultipleshort-termlicencestosingleyearlylicencesarealmostcertaintobemorefrequentthanthis.Assuch,thesalesdatatodateareconsistentwithanincreaseinthenumberofpeoplebuyingalonger-termRFLsincethepriceincreases.Againstthis,4percentoffishersshiftedfrom1or3-yearlicencesto3or28-daylicences.Thismayindicatethatwhiletheyarestillfishing,theyarefishinglessthanbefore.Themodellingforthe2016pricechangesassumedthat28-daylicencescouldfallbyupto50percentwiththeselicencesshiftingto3-daylicences.Itappearsthatthereductionwasnotassignificant,butalsothattheshiftwastowards1-yearlicencesinstead,withonlyaslightshiftfrom28-dayto3-daylicences(of12percent),indicatingthatthechangefrom2-dayto3-daylicenceswasnotamaterialfactorinsales.Itisnotedthatnotallthechangesinthesurveyedsamplewereattributedtothepricechanges.Surveyrespondentswereaskedaboutthereasonsforthechangeinlicencetype.• Forsurveyrespondentsthatchangedtoashorterdurationlicencetype,only41percent

citedthepricesasthefactorfortheirchange.Aslightlylargershare(44percent)indicatedtheyhaddecidedtofishless.

• Ofthosethatchangedtoalongerdurationlicencetype,only15percentindicatedthatpricewasafactorfortheirchange.

RFLrevenueInthesevenmonthstoJanuary2017,RFLrevenueisup34.5percentonthesameperiodayearago.4Thissuggestsanoverallincreaseinrevenuewillberealisedforthefullfinancialyear,withtheexpectedyearendrevenuebetween$9.0millionand$9.6million.TheexpectedrevenueislessthanthefiguremodelledinthepreviousRIS($10.4million).Factorscontributingtothedifference(between$0.8and$1.4million)include:• thethree-yearlycycleofrenewalsof3-yearlicences,whichwasnotseparatelymodelled

intheRIS,accountsforanexpectedreductioninrevenueofaround$900,000in2016-174Cautionmustbeexercisedgiventhelimiteddatasincethepricechanges.Forexample,takingrevenueonlyuptoDecember2016,theincreaseinrevenueovertheprioryearisonly21percent.Thissuggestsadegreeofmonth-to-monthvolatilitywhichmayaffectconclusionsbasedonpartial-yeardate.


16

• thebring-forwardofpurchasesof3-yearlicencesinJune2016tobuythelicencesbeforethepriceincreases,whichwouldexplainareductioninrevenueof$90,000to$120,000

• ahigherthanexpectedmovetotheonlinepurchasingoflicences.The2016modellingassumed62percentof3-yearlicencesand44percentof1-yearlicenceswouldoccuronline.InthesevenmonthstoJanuary2017,80percentof3-yearlicencesand60percentof1-yearlicenceswereboughtonline.Thisaccountsforareductioninrevenueofaround$70,000.

Theseknownfactorsexplainmostofthedifferenceinrevenue,andinparticularthefirsttwofactorswouldnotoccurnextyear.Inaddition,thereislikelytohavebeenanamountofshiftingbetweenlicencetypesassomepeopletrytoobtainbettervalueformoney,butwhichisnotdirectlyobservable.Overall,theRFLsalesdataarebroadlyconsistentwiththeexpectedincreaseinrevenue,suggestingthatthepriceincreaseshavebeeneffectiveinmeetingtheobjectiveofincreasingrevenuefortheTrustAccount.OnlinesalesThe2016priceincreasesincludedadiscountforonlinesales.Asnotedabove,inthesevenmonthstoJanuary2017,80percentof3-yearlicencesand60percentof1-yearlicenceswereboughtonline,higherthanexpected.Thismayoverestimatetheshifttoonlinepurchases,asonlinepurchasestypicallyoccurearlierinthefinancialyearonaveragethanin-storepurchases.Thesurveyindicatedthat27percentofonlinepurchasersboughttheirpreviouslicenceinastore.Thisindicatesastrongshifttowardsonlinesales,asprojectedinthepreviousRISmodelling.Mostoftheshiftisduetobetterconvenience(79percent)ordesireforaplasticcard(16percent),withonly5percentindicatingthelowerpriceasthereasonforthechange.Itwouldappearthatthelowerpriceforanonlinelicencedoesnotactasastrongincentivetomovetoonlinepurchasing.Inseveralcasesrespondentsalsonotedthatthelocationwheretheyboughttheirpreviousrecreationallicencehadsincestoppedsellingsuchlicences;thereductioninlocalalternativeshaddrivensomepeopletopurchaselicencesonline.EffectivenessofRFLrevenueraisedTobefullyeffective,therevenuecollectedfromRFLsalesmustbeusedonactivitiesthatprovideagenuinenetbenefittorecreationalfishers.AstheamountofrevenueraisedfortheTrustAccountisdiscretionary,therevenueraisedandallocatedtoTrustAccountprogramsshouldalignwithfishers’willingnesstopay.Asidefromasmallamountofrevenueusedtocoveradministrativecostsnecessarilyincurred,spendingfromtheTrustAccountissubjecttorigorousconsiderationtodeterminewhetheritisprovided.Proposalsforfundingcontinuetosignificantlyexceedavailablerevenue.ThedepartmenthasconductedevaluationsonanumberofprogramsfundedfromtheTrustAccountanddeterminedthattheyhaveprovidedvalueformoney.Basedonthefundingallocationprocessandtheprogramevaluations,thedepartmentisconfidentthatprogramsfundedfromtheTrustAccountcontinuetorepresentnetbenefitstothesector.Thesurveyofrecreationalfishersidentifiedthat,forsuchfishers:• 51percentofrespondentsindicatedthattheRFLpricewas“asignificantfactorin

decidingwhethertobuyalicenceorwhichlicencetypetobuy”.Thisresponsewasmoreprevalentamongthosewhopurchasedthelicenceonline,andmoreprevalentamong


17

shorterdurationlicences.However,costwasconsideredanimportantfactorforonly48percentofthosethatwereawareoftheuseofRFLrevenuefortheRFLTrustAccount.5

• 44percentofrespondentsindicatedthatRFLpricewasasignificantcostcomparedtoothercostsinvolvedinfishing,with20percentindicatingthepricewas“verysignificant”.ThefindingofRFLpricebeingasignificantcostwasmoreprevalentamountshorterdurationlicencepurchasers,andfellto40percentamongthosewhowereawareoftheuseofRFLrevenuefortheTrustAccount.

SomefishersprovidedresponsesontheirwillingnesstopayforaRFLontheunderstandingthatallrevenuewasusedforprogramsintheTrustAccount.• InrelationtotherevenuegeneratedfortheTrustAccount,56percentofrespondents

indicatedthatthecurrentrevenueraisedfromRFLsalesisaboutright,while44percentindicatedthattherewasaneedforincreasedspendingonprojectsandmorerevenueshouldberaised(thesurveyincludedathirdoption‘reduceRFLrevenueandTrustAccountspending’,whichreceivedzeroresponses).6

• Askedaboutpricestheywouldbewillingtopay,respondentsindicatedthefollowing:Licence Feein2016-17 Average

willingnesstopay

Medianwillingnessto

pay3-daylicence $10 $8.75 $1028-daylicence $20 $23.75 $201-yearlicence(online) $33 $62 $501-yearlicence(agent) $35 $62 $503-yearlicence(online) $90 $142 $1203-yearlicence(agent) $95 $142 $120

Somecareshouldbetakenininterpretingtheseresultsassomerespondentsdidnotprovideafigure(whichmayindicateareluctancetopaymore),oronlyprovidedafigureforthelicencetypetheypurchase.Thelower(average)willingnesstopayfora3-daylicencereflectsthatsomeoftheseresponsessuggestedthatalowerfeecouldbeintroducedforfirst-timefishers,sothattheyareencouragedtotryfishing.Thismayhavemerit,butraisesimplementationandenforcementquestions,whichwouldneedtobeconsideredinmoredetailwhenremakingtheRegulations.OtherimpactsOvertheperiodof2016-17,therehasbeennoincreaseinnon-complianceidentifiedbyfisheriesofficers.Inaddition,nounexpectedimpactsonfishingbehaviourhavebeenidentified.

577percentofsurveyrespondentswereawarethatallRFLrevenueispaidintotheTrustAccountandusedsolelyforprogramsandinitiativestoimproverecreationalfishingopportunities.Therewaslessawarenessamongthosethatpurchaseshorterdurationlicences.6AnumberofpeoplewhoindicatedthelevelofRFLrevenueshouldremainaroundthesamealsosuggestedtheRFLpricesshouldbereduced,onthebasisthatsomerevenueshouldberecoveredfromgroupscurrentlyexemptfrompurchasingalicence.


18

OverallfindingThecurrentRFLpricesareachievingtheirintendedpurpose.Thelevelofrevenueraisedissupportedbymostrecreationalfishersandisusedonprogramsofvaluetothesectorthatcontinuetodemonstrateapositivebenefittothesector.Theimpactsofthe2016priceincreasesarepreliminaryonly,butpointtoincreasedrevenueasexpected,withoutafallinthenumberofpeoplefishingandwithoutanyapparentconsequentialincreaseinnon-compliance.ThereisevidencethatatleastsomefishersarewillingtopaymoreforanRFLlicenceinordertoincreasetheamountofrevenueraised,butthemajorityoffishersconsiderthecurrentrevenueisaboutright.Thechangesinthetypesoflicencespurchasedindicatestheremaybelimiteddemandfor28-daylicencesgoingforward,withthesenowbeinglessthan6percentofallsales.Licencetypesshouldideallymatchfishingpatterns.Thesalesdatasuggeststhatthislicenceisnotwellsuitedtomostfishers,and/ordoesnotrepresentvaluecomparedtootherlicencetypes.Thedepartmentwillmonitorthesalesofthislicencetypeandconsiderwhethertoretainit.CommercialfisheriesleviesThefisheriesservicesleviesareexpectedtoraise$2.4millioninrevenuein2016-17,havingincreasedrevenuebyanaverageof4.4percentperannumoverthepastthreeyears.

2013-14 2014-15 2015-16 2016-17$2,067,261 $1,975,028 $2,291,814 $2,358,651

Thisislowerintotalrevenuetermsthanthelevelexpectedatthetimeofthe2013-14amendments(ofaround$4millionin2016-17).Thisdifferenceisduetoacombinationof:• someleviesbeingreducedtoreflectfisheriesservicescostsbeingre-costeddownwards

(costshavefallenbyaround27percentinrealtermssince2013)• areductioninthetotalnumberoflicencessince2014(from2,321in2014to2,230in

2017)7.Overall,iftheleviesintroducedin2013-14hadnotbeensubsequentlyamendedtoreflectlowercosts,andtherehadbeennochangeinlicenceandquotanumberssince2014,thetotalamountofrevenuecollectedin2016-17wouldhavebeen$3.8million,closertotheoriginalprojection.Iftherehadbeennoreductionincostsoverthistime,thisamountofrevenuewouldhaverecoveredaround12percentofcurrenttotalcosts.Becausemostofthedifferenceinrevenueisduetoleviesbeingadjustedtoreflectlowercosts,theoverallproportionofcostrecoveryissimilartowhatwasexpectedatthetime.Thedepartmentestimatesthat,in2016-17,fisheriesserviceslevieswillrecoveraround11percentoftotalcostsrelatedtocommercialfisheries,slightlylowerthanthe13percentprojectedinthepreviousRIS.Thisdifferencecanbeattributedtoafallinlicencenumberswheretherewasnoadjustmenttoleviesmade,aswellaschangesincostsofactivitiesthatarenotrecoveredthroughlevies,whichaffectstheoverallpercentage.The2013-14RISexaminedwhethertheunderlyingcostswereefficient.Inansweringthisquestion,thatRISconsidered:anumberofreportsandreviewswhichsuggestedthecosts7Insomesituations,changesinlicencenumbersareaddressedbyamendingtheleviesofremaininglicenseesineachfisherytorecoverthesameamountofrevenue.However,thishasnotoccurredinallcases.


19

wereefficient;theviewsoftheFisheriesCostRecoveryStandingCommittee(FCRSC);andtheresultsfrombenchmarkingagainstfeesinSouthAustralia.Onthisbasis,the2013-14RISconcludedthattheunderlyingcostswerebroadlyefficient.However,thedepartmentagreedwiththeFCRSCtoexcludesomespecificcostsduetoaconcernbyindustryaboutthelevelofcosts,withtheconcessionsprovidinganopportunitytoexplorescopeforreductioninthecostofservicesunderthenewprospectivesystem.Sincethattime,therehavebeensubstantialreductionsincostsofsomefisheriesservices,andadjustmentstotheleviestoincorporatethesechangesincosts.Notingthatanumberofcostareashavebeenreviewedsince2014,resultingintheleviesacrossmanyfisheriesbeingreduced,thedepartmentisnowconfidentthatthecostsoffisheriesservicesareefficient.Inpartduetoanimprovementinefficiency,thevalueoftheconcessionsisnowlowerthanprojectedatthetimeofthe2013-14RIS.

Concession Valueofconcession2013-14

Currentvalueofconcession

Nilcostrecoveryforsurveillance,intelligenceandinvestigationsinrelationtoallcommerciallicenseeexceptabalone

$669,000 $490,000

Reducedcostrecoveryforcatchandeffort $115,000 $100,000Nilcostrecoveryforpreparationoffisherymanagementplans

$65,000 $50,000

Reducedattributionofcoststofinfishfisheries $83,000 $50,000

Levycapforsmalloperators $33,000 $22,000

Totalvalue $965,000 $712,000

Theexclusionofsomecostsrelatedtocatchandeffortactivitiesandthepreparationoffisherymanagementplansarenotcorrectlycategorisedas“concessions”.Inreality,theseareactivitiesthatalsohavealargerbenefittothewidercommunity,becausetheyensurethatgovernmentdecisionsaboutallowingcommercialtakeofthestate’sfishresources,andcoordinatingactivitiesacrossotherfisheryobjectives,arewellinformed.Fisheriesmanagementplansensurethatthecommunity’sinterestsareprotected.Thedepartmentconsidersitappropriatethatthegovernmentcostsrelatedtothepreparationoffisheriesmanagementplansand35percentofcostsrelatedtocapturingcatchandeffortdata—togetheraround$150,000perannum—continuetobenotrecoveredfromcommercialfishers,butcontinuetobemetfromgovernmentfunding.Currently25outof765totallicencesreceivethesmalloperatorconcession.Thesmalloperatorconcessionisaimedatlimitingthelevypayablebysmalloperators.However,inpracticethisisappliedonaperfisherybasis,wherethescaleoffishingoperatorsisaveragedwithineachfishery.Therefore,theremaybesomelargeroperators(withagreaterabilitytopayforfisheriesservices)thatreceivedtheconcessioninsomefisheries,whilesomesmalloperatorsinotherfisheriesdonotreceivetheconcessioniftheirfisheryisdominatedbylargeroperators.Thedepartmentbelievesthisconcessioncouldbebettertargetedtosmalloperators.TheFCRSChasalsoraisedaconcernonthematterofhowsmalloperatorsarelevied.TheabilitytoimplementadifferentapproachwillbesubjecttothedraftingprocessofthenewRegulations,andwillbeconsideredinthatcontext.


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OtherimpactsThedepartmentdoesnotconsiderthatlevieshavehadanymaterialorunexpectedimpactsonfishprices.Therehasbeennomaterialimpactontheviabilityofoperators,althoughonesmallbaitfisherhasadvisedthatfullrenewalcostsmaketheiroperationunviable,andthatthefisherwillbeconsideringwhethertorenew.Therehasbeennoincreaseinnon-complianceidentifiedbyfisheriesofficers.OverallfindingThefisheriesservicesleviesareachievingtheirintendedpurposeofrecoveringaportionofthecostsofprovidingfisheriesservices,andbalancingtheneedsofsmalloperators.2016-17isthefirstyearinwhichthefullimpactofthechangesmadein2013-14willtakeeffect,withmostoftheleviespaidinAprilandothersinJune.Therefore,theremaybeimpactsthathavenotyetmaterialised.Whiletheleviesareachievingtheirprimarypurposeofrecoveringcosts,theRISonremakingtheRegulationswillneedtoexaminepotentialalternativeapproachestorecoverthesameamount,suchashowcostsareallocatedbetweenindividuallicensees.Thismayprovideanopportunitytoremoveorreducetherelianceonthesmalloperatorconcession.Intheshortterm,theestablishmentoftheVictorianFisheriesAuthority(VFA)isnotexpectedtoaffectthecostofanyfisheriesservices.Itislikely,however,thattheBoardandVFAexecutivewilllookintoallareasoftheVFA’soperationstoensureitcanperformasefficientlyandeffectivelyaspossible.Royalty(abalonequotaunits)In2015-168theroyaltyresultedinrevenueof$459,030(beingtheapplicationoftheroyaltyratelesstheamountpaidinotherlevies).SincethecurrentRegulationscommenced,theroyaltyhasaveraged$383,897peryear.RevenueYear Royaltycollected

($)GVP($)

Royaltyas%ofGVP

2007-08 1,205,430 26,617,624 4.532008-09 308,975 28,528,474 1.082009-10 175 20,060,328 0.002010-11 221,547 19,541,053 1.132011-12 240,077 22,521,450 1.072012-13 284,720 23,569,866 1.212013-14 791,068 24,890,684 3.182014-15 765,586 21,962,304 3.492015-16 459,030 19,393,885 2.37Average 383,897 22,558,506 1.69Itisdifficulttodetermineifthiscurrentrevenuelevelistheexpectedoutcome,astheformulausedtocalculatetheroyalty(withreferencetoGVPandotherlevies)makesvolatilityintheoverallrecoveryrateinevitableandthereforedifficulttoforecastandtobenchmark.

8Royaltiespaidinafinancialyearrelatetothelicensingperiodofthefollowingfinancialyear.


21

TotheextentthattheamountoftheroyaltyisdesignedtotakeaccountofGVP(aproxymeasureofprofitability)andpaymentofotherlevies,theroyaltyisachievingitsintendedpurpose.Itisunclearhowwelltheroyaltyformulaisactuallycapturingvalueinproportiontothesurplusvaluegeneratedbythefishery,andthereforeunclearifanappropriateshareofthevalueofthefisheryisbeingreturnedtothecommunityasawhole.ItisalsodifficulttobenchmarktheroyaltyamountagainstotherAustralianjurisdictions,astheotherstatesdonotchargeroyaltiesonabalone(oranyotherfisheries).Asnoted,thecurrentindustryviewisthattheroyaltyshouldbereducedorremoved.Thenetroyaltyamountexpectedtobepaidin2016-17(forthe2017-18licensingperiod)is$404,030.ThisismadeupofroyaltiespaidbyCentralandEasternzonelicenseesof$488,153partiallyoffsetbytheeffectofthenegativeroyaltypaidbytheWesternzoneof$84,067.Consideredintotality,thecurrentstructureoftheroyaltyandleviescancreateproblematicincentives.Forexample,wheretheroyaltyrateishigherthanthetotalfisheriesservicesandFRDClevies,thereisanincentiveforindustrytoencouragegovernmenttoincreasetheamountoffisheriesservicesprovidedtothefishery.Ifquotaholdersarerequiredtopayatotalof7.2percentofGVP,theywouldprefertoreceiveservicesinexchangeforasmuchofthisamountaspossible.Thisrisksreducedscrutinyaboutthelevelandefficiencyofservicesprovidedtothesefisheries.DuetolowerGVPcausedbyanabalonevirusandreducedinternationalpricesforabalone,theWesternzonefisheryiscurrentlypayinganegativeroyalty.Accordingly,becausethetotaloffisheriesservicesandFRDCleviesexceeds7.2percentofGVP,theroyaltyformulaactstorefundtheamountofotherleviesoverandabovethe7.2percent.Thisiseffectivelyasubsidytothefishery,asnotonlydothefisherspaynoroyalty,buttheyalsopayfisheriesservicesleviesbelowtheactualcostofthoseservices.Loweringtherateoftheroyaltycalculation(i.e.below7.2%)wouldincreasethesizeofthesubsidyprovidedtothisfishery,whileremovaloftheroyaltyaltogetherwouldmeanthisfisherypaysmoreintotallevies.OverallfindingTheroyaltyarrangementsarestillachievingtheirintendedpurpose,withinthecontextofadjustingtheroyaltypayableforchangesinGVPandotherlevies.However,therearedesignconcernsintermsoftheroyalty’sinteractionwiththeotherfisherieslevies,andwhetheritcreatesadequateincentivesforimprovingservicerequirementsandefficiencies.WhilethefactorsresultinginthenegativeroyaltyfortheWesternzonearetemporaryandareturntopositiveroyaltiesislikelyinthemediumterm,othertrendsinthefisheriessuggestthattheamountoffisheriesservicesleviesisgettingclosertotheroyaltycap,andinthelongerterm,theWesternandCentralzoneswillbeinpositionswhereyeartoyearvolatilityinGVPwillmakenegativeroyaltiesmorecommon.Changestotheoverallamountofrevenuecollectedfromtheroyaltyarenotproposed.However,futureoptionsmightincludechangingtheformulafordeterminingtheroyaltypayable—forexample,settingalowerroyaltyratebutnotreducingtheroyaltybytheamountsofotherlevies.Further,thebasisforcalculatingtheroyaltycouldbechanged—forexample,theroyaltycouldbebasedonthepricespaidintransfers.Theseoptionswouldneedfurtherconsiderationoftheirfeasibility,impactsandtrade-offswithinaRIS.


22

TransactionalfeesIn2015/16,thesefeestotalledaround$120,000inrevenuecollected.Asthefeesaredemanddriven(i.e.,theydependonalicenceholderinitiatingaspecifictransaction),therewasnorevenuetargetforthefees,otherthantomeetthecostsonatransactionalbasis.FisheriesVictoriahasestimatedthecostofprovidingeachservice,asshownbelow.Fee Feevalue

2016-17Estimatedcostofservice*

Generalpermit $146.37 $142Generalpermit(developingfishery) $387.53 $213Variationofgeneralpermit $146.37 $142Protectedaquaticbiotapermit $146.37 $142Variationtoprotectedaquaticbiotapermit $146.37 $142Fishingboatregistration $50.18 $36Fishingboatregistrationrenewal $50.18 $36Fishingboatregistrationtransfer $50.18 $36Commercialfisheryapplicationfee(aquaculture–Crownlandandon-shore)

$1,681.16 $284

Commercialfisheryapplicationfee(abaloneaccesslicence,fishreceivers’(abalone),aquacultureprivateland)

$387.53 $284

Commercialfisheryapplicationfee(allothers) $257.89 $284Licencefeeforissueorrenewalofcommercialfisherylicences

$50.18 $36

Transferofcommercialfisherylicence(aquaculture) $263.47 $213Transferofcommercialfisherylicence(abaloneaccess)

$387.53 $213

Transferofcommercialfisherylicence(other) $257.89 $213Transferofindividualquotaunits(abalone) $387.53 $213Transferofindividualquotaunits(other) $50.18 $36Variationofcommercialfisherylicence $50.18 $36Abalonequotaunitholdingstatement $50.18 $36Notificationbyholderofabalonefisheryaccesslicence

$50.18 $36

*Excludesnon-staffcosts;andexcludestransactionsthatraiseunexpectedoruniqueissuesandthatthereforerequiremoretimeandentailahighercost.

Theestimatedcostsshouldbeconsideredindicativeonlybasedonadesktopreviewratherthantrackingoftimestoprocessactualindividualtransactions.Thislevelofanalysisisappropriategiventheverysmallamountsofrevenuecollectedbythesefees.Theestimatedcostsarebasedonthemanager'sexperienceofhowlongittakestoactionatypicalroutinetransaction,andthenmultiplyingthatbythehourlyrate($71/hr)associatedwiththestaffwhoactionthetransactions.Transactionsthatmaysometimesraiseunexpectedoruniqueissuesandthatthereforerequiremoretime(andcost)werenotconsidered.Asadesktopreview,theestimatesincludeonlystaffcosts.Other‘non-staff’costs,whichmayhavebeenidentifiedinamoredetailedstudy,arenotincluded.


23

Formanyofthetransactioncategories,thereareoftenverylownumbersoftransactionseachyear,andin2015-16therewerenotransactionsprocessedforlicenceapplicationsforaccesslicences,abaloneaccesslicences,andaquaculturecrownlandlicences.Thismakesitdifficulttohaveconfidenceintheprecisionoftheestimates,andtheyshouldbeviewedasanapproximationonly.Thereviewofcostsfoundthatnearlyallthetransactioncostswerenowbelowthecurrentfees,byaround8percentonaverage(forthetransactionsprocessedin2016-17).Thedepartmentthereforeconsidersthereisabasistore-alignthefeestotheestimatedcosts.ThedepartmentwillexaminereducingthesefeesintheregulatoryimpactstatementpreparedfortheremakingoftheRegulations.Otherstateshavefeesforsomeoftheabovetransactions.RelevantfeesaresetoutinAppendixC.Careshouldbetakenwhencomparingfeeswiththoseinotherstates.Thereisnotadirectmatch,asthetransactionsrequiredineachstatearerelevanttotheprincipalActandotherarrangementsinfisheriesmanagement.Evenwheresimilarfeecategoriesexist,theactivitiesperformedbythegovernmentmaynotbedirectlycomparable,asthedifferentlegislationineachstatemaydictatethestepsinvolvedineffectingeachtransaction.Lastly,theextenttowhichotherstates’feesaresettorecovertheactualcostofeachtransactionisunclear.Intheshortterm,theestablishmentoftheVictorianFisheriesAuthority(VFA)isnotexpectedtoaffectthecostofanyfisheriesservices.Itislikely,however,thattheBoardandVFAexecutivewilllookintoallareasoftheVFA’soperationstoensureitcanperformasefficientlyandeffectivelyaspossible.OverallfindingThecurrenttransactionalfeesaregenerallyhigherthantheestimatedcostsofeachtransaction,andtheforthcomingregulatoryimpactstatementshouldconsiderloweringthesefees.


24

Conclusions

ThecurrentRegulations,asamendedwithinthepasttenyears,arebroadlyachievingtheirintendedobjectives.Thefees,royaltiesandleviesapplyingtocommercialandrecreationalfishingshouldcontinueatthesamelevelsinremadeRegulationsfrom2018.ThecurrentRFLpricesareachievingtheirintendedpurpose.ThelevelofRFLrevenueissupportedbymostrecreationalfishersandisusedonprogramsofvaluetothesector.Dataontheimpactsofthe2016priceincreasesarepreliminaryonly,butpointtoincreasedrevenue,asexpected,withoutafallinthenumberofpeoplebuyinglicences.Oncethehigherrevenuecollectedin2016-17startsflowingthroughtoTrustAccountprogramsandgrants,improvedaccessandavailabilityofrecreationalfishingshouldassistinsupportingincreasedparticipationinrecreationalfishing,consistentwiththegovernment’sTargetOneMillionpolicy.ThereisevidenceofatleastsomefishersbeingwillingtopaymoreforaRFLlicence,butthemajorityoffishersconsiderthecurrentamountofrevenueisaboutright.ThereremainsarelativelylowlevelofawarenessofhowRFLrevenueisspentonprojectstosupportrecreationalfishers.ThedepartmentandtheVFAwillconsiderthisawarenesslevelinthefuturemanagementoftheTrustAccount.TheFisheriesServicesleviesareachievingtheirintendedpurposeofrecoveringaportionofthecostsofprovidingfisheriesservices,andbalancingtheneedsofsmalloperators.Onthebasisthattheunderlyingcostsonwhichtheleviesarebasedhavenotchangedmaterially(i.e.,thecostshaveincreasedinlinewithchangesinthevalueoffeeunits),thecurrentlevyarrangementsshouldcontinueintheremadeRegulations.TheRISwillneedtoexplorewhetheralternativeapproachesarefeasibleandtoconfirmthatthecostsremainefficient.Thereisanopportunitytoconsiderwaystobettertargetthesmalloperatorconcession.Theroyaltyarrangementsforabalonequotaunitsareachievingtheirintendedpurpose,withinthecontextofallowingtheamountoftheroyaltypayabletovaryforchangesinGVPandotherlevies.However,thedesignoftheroyaltyeffectivelyprovidesasubsidy,whichisnottransparent,wherethecostoffisheriesservicesexceedstheroyaltyrate.Thisreducesindustryincentivetoscrutinisethelevelandefficiencyofthefisheriesservicesitreceives.Inthefuture,thedepartmentshouldexplorethefeasibilityofidentifyingotherdatathatcouldvalidatetheoverallamountofroyaltyrevenue.Ingeneral,thecurrenttransactionalfeesarenowhigherthantheestimatedcostsofeachtransaction.Theforthcomingregulatoryimpactstatementshouldconsideraligningthesefeestotheestimatedcosts.


25

Appendices


26

AppendixA:CurrentcommercialleviesTheFisheriesServicesleviesaresetaccordingtofourindividualleviesforeachfishery.Theseare:research;management;compliance;administration.Thefollowingtabledescribesthetypesofactivitiesperformedbythedepartmentineachcategory.Activityarea DescriptionofservicesResearch–includesscientificassessmentandmodelling

AppliedscientificresearchstudiesandassessmentsarerequiredtounderstandthebiologyofthefisherytoestablishtheTotalAllowableCatch(TAC).Thisincludesanalysisandmodellingofdataforstockassessment(includingfromcatchandeffortrecording,divesurveysandothersurveys).Thistypeofresearchisessentialtodeterminethesustainableresourcebaseforafishery.

Management–includesplanningandoperationalmanagementforfisheries

FormostfisheriesinVictoria,amanagementplanistypicallydevelopedtomanageharvestandaccess.Thisplancoversarangeofaspectssuchas:theestablishmentoftheTAC;itsassignmenttoquotaholders(e.g.forquota-managedfisheriessuchasrocklobster,abalone,giantcrabandscallopsinVictoria)andeffortorinputcontrolstolimitcatch;complianceissues;andotherregulatoryissues.Intheaquaculturesector,reservemanagementplansarepreparedfortheallocationofcrownresources.

Compliance–includessurveillance,intelligence,inspectionsandeducation

Arangeofcomplianceservicesareundertaken,suchassurveillance,intelligence,investigations,inspectionsandeducationservices.Somecomplianceservicesaresolelyassociatedwiththecommercialsector(e.g.compliancebylicence/quotaholderswithcommercialfishingrules)whileothersareassociatedwiththeoverallprotectionofthefishery,suchasmonitoringtodetectillegalfishing.

Administration–licenceadministrationandcostrecoveryadministration

Licensingisusedtomonitorandmanagecommercialandrecreationalaccess.Licencesarerequiredforcommercialandrecreationalfishingandforboatregistrationsandrenewals.Thisservicealsoincludesmanagingthecollectionof“catchandeffort”datathatmustbeprovidedtoFisheriesVictoriabylicenceholders.Tomaintainandadministerthecostrecoverysystemrequiresappropriateprocessandsystems;consultationonservicesandcosts;andfeesandlevysetting.ItalsoincludessupportfortheFisheriesCostRecoverySteeringCommittee(i.e.,paymentofsittingfeesandpersonalexpensesofmembers;onlypaymentofsittingfeesandpersonalexpensesarecostrecovered).

Theabovetableshowsallactivitiesrelatedtocommercialfisheries.Notalltheseactivitiesareincludedinthecalculationofthecurrentlevies.Thefollowingtableshowswhichactivitiesareincludedinleviesandwhicharenotincluded.


27

Included Excluded

Research Research

Datacollection,monitoringandanalysisforstockassessmentResearchonenvironmentalimpactsofcommercialfishing

EnvironmentalResearchMinisterialsupport

EducationandEnforcement EducationandEnforcement

InspectionsoflicensedorauthorisedcommercialfishersSurveillanceoflicensedorauthorisedcommercialfishers(abaloneonly)Intelligencerelatedtolicensedorauthorisedcommercialfishers(abaloneonly)Investigationand/ormajorcasemanagementrelatedtolicensedorauthorisedcommercialfishers(abaloneonly)Educationprovidedtocommercialoperators

MinisterialSupportInspectionsofunlicensedorunauthorisedcommercialactivitiesInspectionsoflicensedorauthorisedrecreationalactivitiesSurveillanceofunlicensedorunauthorisedcommercialactivitiesSurveillanceoflicensedorauthorisedrecreationalactivitiesIntelligencerelatedtounlicensedorunauthorisedcommercialactivitiesIntelligencerelatedtolicensedorauthorisedrecreationalactivitiesInvestigationand/ormajorcasemanagementrelatedtounlicensedcommercialactivitiesInvestigationand/ormajorcasemanagementrelatedtolicensedorauthorisedrecreationalactivitiesCommunityengagement

FisheriesManagement FisheriesManagement

SettingquotaandharvestlimitsOperationalmanagementofmarinefisheriesOperationalmanagementoffreshwaterfisheriesOperationalmanagementofaquaculturefisheries

MinisterialsupportRegulatory(policy)servicesEmergencymanagementFisheryManagementplans

Administration Administration

CommercialCatchandEffort(65%ofcosts)QuotacatchrecordingservicesITsupportsystemsforlicensingandquotamanagementCommercialLicence&QuotaadministrationCostrecoveryIT

CostrecoverypolicyCostrecoveryregulationamendmentCostrecoveryadministration


28

Thefisheriesservicesleviesapplicableforeachfisheryin2016-17areasfollows:Licence FSlevy

(feeunits)FSlevy

($in2016-17)Abalone(WesternZone)Fishery 29.7 $414.00Abalone(CentralZone)Fishery 13.4 $186.80Abalone(EasternZone)Fishery 12.8 $178.40Abalone(WesternZone)BlackLipQuotaUnit 50.1 $698.40Abalone(WesternZone)GreenLipQuotaUnit 0 $0.00Abalone(CentralZone)BlackLipQuotaUnit 37.8 $526.90Abalone(CentralZone)GreenLipQuotaUnit 21.9 $305.30Abalone(EasternZone)BlackLipQuotaUnit 49.1 $684.50Bait(General)Fishery 60.1 $837.80CornerInletFishery 198.6 $2,768.50EelFishery 136.9 $1,908.40GippslandLakesFishery(Bait) 89.3 $1,244.80GiantCrabFisheryLicence 69.9 $974.40Individualgiantcrab(westernzone)quotaunit 6.2 $86.40GippslandLakesFishery 413 $5,757.20GippslandLakes(MusselDive)Fishery 79.5 $1,108.20LakeTyersFishery(Bait) 211.8 $2,952.50MallacootaLowerLakeFishery(Bait) 233 $3,248.00SnowyRiverFishery(Bait) 130.3 $1,816.40OceanFishery 22.5 $313.70PurseSeine(Ocean)Fishery 95.8 $1,335.50Scallop(Ocean)Fishery 26 $362.40Wrasse(Ocean)Fishery 67.5 $941.00PortPhillipBay(MusselBait)Fishery 115.3 $1,607.30PurseSeine(PortPhillipBay)Fishery 85.4 $1,190.50ScallopDive(PortPhillipFishery 1321.2 $18,417.50SeaUrchinFishery 132.3 $1,844.30Westernport/PortPhillipBayFishery 85.4 $1,190.50RockLobsterFisheryWesternZoneLicence 168.9 $2,354.50IndividualrocklobsterWestern(quotaunit) 7.8 $108.70RockLobsterFisheryEasternZoneLicence 157.7 $2,198.30IndividualrocklobsterEastern(quotaunit) 16.5 $230.00SydenhamInletFishery(Bait) 175.3 $2,443.70Trawl(Inshore)Fishery 41.2 $574.30Aquaculture(PrivateLand-indoorintensive) 41.3 $575.70Aquaculture(PrivateLand-tourism)Licence 70 $975.80Aquaculture(CrownLand-Abalone)Licence 122.1 $1,702.10Aquaculture(CrownLand-BivalveShellfish)Licence 237.2 $3,306.60Aquaculture(CrownLand-Eels)Licence 153.3 $2,137.00Aquaculture(CrownLand-Other)Licence 82.8 $1,154.20Aquaculture(CrownLand-Offshore)Licence 104.7 $1,459.50Aquaculture(On-shoreAbalone)Licence 231.8 $3,231.30Aquaculture(PrivateLand-Eels)Licence 27.5 $383.40Aquaculture(PrivateLand-Marine)Licence 158.2 $2,205.30Aquaculture(PrivateLand-WarmWaterFinfish)Licence 82 $1,143.10Aquaculture(PrivateLand-Ornamentals)Licence 40 $557.60Aquaculture(PrivateLand-Salmonids)Licence 43.9 $612.00Aquaculture(PrivateLand-Other)Licence 377.4 $5,261.00Aquaculture(PrivateLand-Yabbies)Licence 20.2 $281.60AbaloneFishReceivers 402.9 $5,616.40ScallopFishReceivers 44 $613.40


29

AppendixB:RFLSurveyResultsMethodDuringMarchandApril2017,asurveywasconductedofRFLholderswhohadpurchasedalicencesince1July2016.Therewere460surveyresponses,comprisingthefollowing:• Anelectronicsurveylinkwassentto6,338peoplewhohadpurchasedalicenceonline.

Therecipientswererandomlyselected.Therewere391responses.Theresponseratereflectsanexpectationthatmanyrecipientsmaynothavereceivedtheemail,duetotransmissionfailures(e.g.,oldorincorrectemaildetails),spambockingorfiltering,andisthereforewithinanacceptablerangeforavalidsurveyofthiskind.

• 70hardcopysurveysweremadeavailablethroughtworetailagentsinouterMelbournesuburbs.Therewere52surveyscompletedandreturnedtothedepartment.

• Additionalsurveyswerecompletedby17attendeesatafocusgroupheldbythedepartment,6ofwhichwereforlicencespurchasedinstoreand11boughtonline.

BasedonthenumberofsurveyscompletedandtotalRFLsalesofaround290,000peryear,theaccuracyofthesurveyfindingsis±1%formostresults.9ResponseprofileReflectingthemethodofdistributingthesurveys,mostsurveyscompletedwereforonlinepurchases.Thisdoesnotreflecttheactualproportionoftotallicencesboughtonline(whichisaround60-65%).Therefore,thesurveyresultstendtoover-representonlinepurchasersandwereexaminedonlyforstatisticallysignificantdifferencesbetweenonlineandin-storepurchases.

Asidefrommethodofpurchase,theresponsesreceivedareconsideredsufficientlyrepresentativeofRFLpurchasers.

9Accuracyisatthe95%confidencelevel.Thisdoesnotapplyforresultsrelatedtosmallersubgroups,asindicatedwithrelevantresults.

Onlinepurchase,402

Agentpurchase,58


30

9% 7%

59%

25%

0

50

100

150

200

250

300

3-day 28-day 1-year 3-year

Licencepurchased

19%

30%

24%

19%

6%

1% 0

20

40

60

80

100

120

140

160

18-30 31-40 41-50 51-60 61-70 Over70

AgeProfile


31

21%oflicenceholdersages18-30indictedtheyhadbeenfishingformorethan20years,and45%indicatedtheyhadbeenfishingmorethan10years.

8% 14%

7%

16%

55%

0

50

100

150

200

250

300

lessthan1year 1-5years 5-10years 10-20years morethan20years

Fishingexperience

Victorianresidents93%

Otherstate6%

OutsideAustralia1%

Residence


32

Findings1. ChangestolicencepurchasedsincepriceincreasesOverall,68%ofsurveyedfishersboughtthesamelicencetheyboughtpreviously.32%ofsurveyrespondentshadchangedtheirlicencetypepurchasedbetweentheircurrentandpreviouslicence.(Thisfigureignoresthosewhohadpurchasedalicenceforthefirsttime).

Therewasslightlymorechangeoflicencetypesamongonlinepurchasers(35%)andnotablylessamongpurchasersinstore(22%,althoughthishasaconfidencerangeof±5%).Foreachlicencetype,thechangeswereasfollows:• 57%ofpeoplewhopreviouslyboughta2-daylicencechangedtheirlicencetype,with

mostofthese(48%)movingtoa1-yearlicence.Withsomesmallershiftstothenew3-daylicencefromotherlicencetypes,thetotalnumberof3-daylicencesfellby43%

• 60%ofpeoplewhopreviouslyboughta28-daylicencechangedtoanotherlicencetype,withmost(49%)shiftingtoa1-yearlicence.Withsomesmallershiftstoa28-daylicence,thenetresultwasadecreasein28-daylicencesof31%

• 22%ofpeoplewhopreviouslyboughta1-yearlicenceshiftedtootherlicencetypes(nearlyallto3-yearlicences),althoughthisismorethanoffsetbyshiftsfromotherlicencetypestothe1-yearlicence,givinganoverallincreaseof10%

• 33%ofpeoplewhopreviouslyboughta3-yearlicencechangedtootherlicencetypes,withnearlyallofthesemovingtoa1-yearlicence.Innetterms,3-yearlicencesincreasedby15%,reflectingshiftstoa3-yearlicence,mainlyfrom1-yearlicences.

Nochange68%

Changedtolongerlicence

10%

Changetoshorterlicence22%


33

Respondentswereaskedaboutreasonsforchangingtheirlicencetype.Forrespondentswhochangedtoashorterlicencetype,thereasonswereasfollows:

Forthoselicenceholderswhochangedtoalongerdurationlicence,thereasonsforthechangewereasfollows:

Decidedtofishless44%

Valueformoney41%

Otherreason15%

Decidedtofishmore41%

Valueformoney15%

Otherreason44%


34

2. AreyouawarethatthemoneycollectedfromVictorianrecreationalfishinglicences

goessolelytoprogramsandinitiativestoimproverecreationalfishingopportunitiesinVictoria?

TherewaslessawarenessamongRFLholdersagedunder30(71%),peoplefishinglessthan1year(65%),peoplefishinglessthan5years(69%),andforthosewhopurchaseda3-daylicence(60%).Therewasslightlymoreawarenessamongthosewhopurchasedtheirlicenceinstore(79%)althoughthiswasnotstatisticallysignificant.

Yes77%

No

23%


35

3. Isthecostofthefishinglicenceanimportantfactorindecidingwhethertobuyalicence,orwhichlicenceyouwillbuy?

Costwasconsideredanimportantfactormoreamongthosewhopurchasedtheirlicenceonline(53%)comparedtoin-store(38%).Bylicencetype,costisconsideredanimportantfactormorecommonlyforshorterdurationlicences,andlessfor3-yearlicences:Licencetype Yes No3-day 63% 37%28-day 53% 47%1-year 54% 46%3-year 34% 66%Costwasconsideredanimportantfactorby48%ofthosethatchangedtoashorterdurationlicence,andby60%amongthosethatmovedtoalongerdurationlicence.Thismayreflecttheabovefindingsthatpriceswerenotadominantfactorinmostofthechangestolicencetypes.Costwasconsideredanimportantfactorfor48%ofthosethatwereawareoftheuseofRFLrevenuefortheRFLTrustAccount.Therewerenosignificantlydifferentresultsbasedonageprofile.

Yes51%

No

49%


36

4. Isthecostofthefishinglicencesignificantcomparedtoothercostsinvolvedinfishing,suchasequipment,bait,travel?

Therewasasmallbutsignificantdifferenceintheanswerstothisquestionbetweenpeoplewhoboughttheirlicencesonlinevsinstore.40%ofpeoplewhoboughttheirlicencesinstorereportedcostwasalittleorverysignificant,comparedwith45%forthosepeoplewhoboughtonline.Bylicencetype,costisconsideredsignificantmorecommonlyamongshorterdurationlicences,andlessfor3-yearlicences:Licencetype Verysignificant Alittlesignificant Notsignificant3-day 23% 23% 49%28-day 17% 30% 47%1-year 20% 23% 54%3-year 16% 22% 59%Costwassignificantbyonly36%ofthosethatchangedtoashorterdurationlicence,andby44%amongthosethatmovedtoalongerdurationlicence.Thismayreflecttheabovefindingsthatpriceswerenotadominantfactorinmostofthechangestolicencetypes.Costwasconsideredsignificantfor40%ofthosethatwereawareoftheuseofRFLrevenuefortheRFLTrustAccount.Therewerenosignificantlydifferentresultsbasedonageprofile.

No

56% Alittlesignificant24%

Verysignificant20%


37

5. Whydidyouchoosetobuyyourfishinglicenceonline?27%(104)ofpeoplewhoboughttheirlicencesonlinehadchangedfrompreviousin-storepurchases.Mostofthosechangingpurchasemethod(88%)bought1or3-yearlicences.Thereasonsforchangingpurchasemethodwereasfollows:

Responsestothissurveyquestionincludedcommentsthatpreviouslocationsforbuyinglicencesnolongerweresalesagents,henceitbeingnolongerfeasibletopurchaseinstore.

Cheaperthaninstore5%

Togetplasticcard16%

Moreconvenient79%


38

AppendixC:Interstatecomparison–transactionfeesNewSouthWalesTransaction FeeamountApplicationfeeClass1commercialfishinglicence $609RenewalfeeClass1commercialfishinglicence $304TransferofRestrictedFisheryEndorsement $304TransferofInlandRestrictedFisheryEndorsement $304TransferofAbalonequota $228TransferofLobsterquota $228TransferofSeaUrchinquota $228Fishingboatlicence–applicationfee(<3m) $213Fishingboatlicence–applicationfee(>3m) $213+$32/mFishingboatlicence–renewalfee(<3m) $60Fishingboatlicence–renewalfee(>3m) $60+$32/mTransferoffishingboatlicence $381SouthAustraliaTransaction FeeamountApplicationfeesforapermitinrespectoftheMiscellaneousBroodstockandSeedstockFishery

$374.00

ApplicationfeesforapermitinrespectoftheMiscellaneousDevelopmentalFishery $4622.00ApplicationfeesforapermitinrespectoftheMiscellaneousResearchFishery $374.00AnnualfeesforapermitinrespectoftheMiscellaneousDevelopmentalFishery $2139.00ApplicationforregistrationofaboatunderalicenceinrespectoftheCharterBoat $667.25to

$2669.00Applicationtovarytheregistrationofaboatusedunderafisherylicence $114.00Applicationtovarytheregistrationofamaster $114.00Applicationtovaryaquotaentitlementunderafisherylicence $142.00ApplicationtovaryarocklobsterpotentitlementunderalicenceinrespectoftheNorthernZoneRockLobsterFisheryorSouthernZoneRockLobsterFishery

$142.00

QueenslandTransaction FeeamountCarrierboatlicence $305.85Charterfishinglicence $305.85Commercialfisherlicence $305.85Commercialfishingboatlicence $305.85Commercialharvestfishinglicence $305.85Generalfisheriespermitapplication $305.85Developmentalfishingpermitapplication $5749.55Requesttoamendalicenceiftherequestistoreplaceaboatidentifiedinthelicence $152.95