Fisheries Management Measures within Scottish Offshore Marine Protected Areas (MPAs) - Socio-Economic Impact Assessment

Non-Technical Summary

Introduction

The Scottish Government has made a long-term commitment to ensuring the sustainable management of the marine environment by balancing the competing interests of use and protection of the sea. This includes developing and implementing a coherent network of Marine Protected Areas (MPAs) to benefit the conservation of vulnerable and characteristic marine species and habitats in Scottish waters. This includes Nature Conservation Marine Protected Areas (NCMPAs) and Special Areas of Conservation (SACs) (hereafter NCMPAs and SACs will be referred to as MPAs when they are being considered collectively).

Proposed fisheries management measures have been developed for offshore MPAs. Scottish Government is now consulting on these proposed measures. Measures for inshore MPAs, Priority Marine Features (PMFs) and Special Protection Areas (SPAs) that overlap the inshore and offshore areas will be considered separately.

What is Socio-Economic Impact Assessment?

Socio-economic impact assessment (SEIA) aims to identify and assess the potential economic and social effects of a proposed development or policy on the lives and circumstances of people, their families and their communities. The assessment investigates the potential cumulative economic benefits and costs, and associated potential social impacts, of implementing the proposed management measures at each individual MPA/SAC. It also considers the potential economic benefits and costs, and associated potential social impacts of implementing the suite of measures overall.

The assessment provides Scottish Government with evidence on economic and social effects to inform the Business and Regulatory Impact Assessments (BRIA), Islands Communities Impact Assessment (ICIA), and Sustainability Appraisal for the suite of proposed management measures.

What are the proposed management measures?

Measures have been developed for 20 individual sites. The measures proposed are based on best available scientific evidence regarding the risk to designated features from different fishing gear. Two management options are proposed for 15 sites and one management options for five sites. These two options present different levels of management, both of which meet the policy and legislative requirements.

Under Option 1 the proposed measures are those that were developed in workshops with stakeholders from 2013-2017 under the EU Common Fisheries Policy (CFP). Under this option 15 sites have zoned management measures proposed, whereby only certain areas are subject to fisheries restrictions and not the entirety of the site. The remaining five sites have measures proposed which place restrictions on the full site. This is the case where a full site level of protection from the specified gear has been identified as the only suitable option to support the achievement the conservation objectives of the site.

Under Option 2, all 20 sites have proposed measures which restricts gears identified as requiring management from the full site.

The fisheries management measures proposed for the MPAs are summarised in Table NTS1 and Table NTS2. Maps showing these measures are included in Appendix C of this report.

Option 1

Measures which restrict fishing gear identified as requiring management, may be zonal or for the full designated site.

Option 2

Measures which restrict the use of fishing gear identified as requiring management from the full designated site.

Zoned management

Gears identified as requiring management are restricted from specified areas within the site

Full site exclusion

Gears identified as requiring management are restricted from the full site

Damaging gears are identified from advice and evidence provided by JNCC. This is available for each site on the JNCC website: Resource Hub.

How was the Socio-Economic Impact Assessment undertaken?

The SEIA has sought to estimate the effects of the proposed management measures in the MPAs both at site level and for the combination of sites as a whole in terms of:

• The potential costs to commercial fishing in terms of the value of landings affected, impact on gross value added, and employment;
• The knock-on impacts on supply chains, both upstream (through application of economic multipliers) and downstream (through consideration of where landings affected are made, and potential impact on the processing sector);
• An analysis of the distribution of economic costs (by location, fishing groups and social groups) and consequent social impacts;
• The potential costs to the public sector; and
• The potential costs and benefits to ecosystem services.

A range was calculated for the potential impacts for each management option (see box below). This reflects the potential for displacement of fishing effort to result in landings that compensate for the landings lost from the site.

Overview of Assessment Estimates

• Option 1: The range presented reflects the potential for displacement of fishing activity to compensate for loss of landings from the site (see ‘displacement test’ below), and the potential for the loss of all affected landings; and
• Option 2: The range presented for Option 2 in the main report reflects impacts on landings, GVA and employment, the potential for displacement of fishing activity to compensate for loss of landings from the site, and the potential for the loss of all affected landings. Other estimates for Option 2 (for home port and port of landing) assume all affected landings are lost.

Potential costs to commercial fishing and upstream supply chains

The value of landings affected for over-12 m UK vessels was based on Vessel Monitoring System (VMS) data linked to landings records. For under-12 m UK vessels, the value of landings affected was calculated from International Council for the Exploration of the Sea (ICES) rectangle landings data, pro-rated based on a consideration of the proportion of the under-12 m landings in the ICES rectangle that might derive from the MPA area. Data from 2015-2019 were used to calculate an annual average value, uprated to 2022 values to account for inflation. Although 2020 data were available, they were excluded from the analysis. The Covid-19 pandemic had the effect of supressing fishing activity whilst markets were closed, so this approach avoided the 2020 data influencing the annual average values.

The potential for the affected fishing effort to be displaced to other areas was assessed. Displacement can provide additional landings that may compensate for the landings lost from the proposed management area, but also result in additional fishing effort in areas outside the proposed management area, and may have consequences in terms of environmental impacts, additional fishing costs, gear conflict and safety. A displacement test was applied which considers the fishing activity affected, by vessel size and gear type, and compares it with the activity of that fleet segment in the surrounding area (within the MPA, in the ICES rectangles that the MPA overlaps, and within the UK Marine Strategy Clean and Safe Seas Evidence Group (CSSEG) region). Where the effort affected exceeds certain thresholds, it is considered that displacement of effort will have greater implications for the fishing industry (changes to costs and earnings profiles, conflict with other fleet segments) and potentially greater environmental impacts. Details of the displacement test are provided in section 3.4.

The value of landings affected was converted into direct gross value added (GVA) using fleet segment-specific GVA multipliers, and the direct, indirect and induced impacts on GVA and employment were calculated from Scottish (national) multipliers. The impacts were reported in annual average terms, the total impact over the assessment period (20 years), and the present value (PV) over the assessment period.

Potential impacts on non-UK vessels were assessed in terms of the number of potentially affected vessels by nationality, and average number of hours fishing. Due to data limitations, it was not possible to quantify a potential economic impact for non-UK vessels.

Distribution of economic costs and consequent social impacts, including downstream supply chains

The negative social impacts generated by the proposed management measures will be strongly connected to the nature, scale and distribution of the economic impacts (on both income and employment). Any significant change in employment, for example generated as a result of restrictions on fishing activity, can have significant social impacts (e.g. on health, crime).

The distribution of impacts on employment in the fishing sector has focussed on the registered Home Port Districts of the vessels affected. The distribution of impacts on the fish processing industry has focussed on the ports of landing of the affected vessels’ catches. The assessment of social impacts takes account not only of the size of income and employment impacts, but also of their size relative to the size of affected ports and port districts, and the geographical and socio-economic context (e.g. in remote areas or on islands).

Costs to the public sector

Public sector costs were estimated for the following broad areas based on discussions with Scottish Government and JNCC:

• Mechanisms to implement restrictions on fishing activity in offshore sites;
• Monitoring and control of fishing activity.

Costs and benefits to ecosystem services

The biodiversity features of an MPA contribute to the delivery of a range of ecosystem services. Management of the MPA may improve the quantity and quality of the beneficial services provided, which may increase the value (contribution to economic welfare) of them. Impacts on the value of ecosystem services may occur as a result of the management and/or achievement of the conservation objectives of the MPA.

The ecosystem services analysis provides a qualitative description of the potential changes in ecosystem service provision associated with the implementation of management measures to support the achievement of conservation objectives for individual features.

What are the likely significant economic and social impacts of the proposals?

Potential costs to commercial fishing and upstream supply chains

Across the full suite of sites, the proposed management measures are estimated to:

• Reduce the average annual value of output landed by the commercial fisheries sector by between £0.7 m and £8.0 m, out of a total annual turnover of around £600 million for Scottish vessels;
• Reduce average annual GVA (direct and indirect) by £0.3 m to £3.4 m;
• Reduce GVA (direct and indirect) by £6.4 m to £66.0 m over the assessment period (present value, 20 years); and
• Reduce the average (mean) number of jobs (direct and indirect) by between 9 and 101 FTEs.

Site specific values are outlined in Table NTS3. Comparison of these impacts to the wider Scottish economy and sea-fishing industry are in Section 6.6.

Table NTS3. Impact on output and GVA for the commercial fishing sector across all sites for each management option (direct, indirect and induced impacts), £000, 2022 prices^[1]

The ranges reflect the scale of potential impacts by taking the potential for displacement into account. The higher end of each range represents a worst-case assumption that all economic activity is lost rather than being displaced to alternative fishing grounds. The lower end of each range reflects the potential for fishing effort to displace to other locations within the surrounding area (in most cases, the ICES rectangles within which the sites are located), without significant environmental or socio-economic consequences. However, there are likely to be other impacts of displacement (changes to cost profiles of vessels, impacts on catch per unit effort, conflict with other vessels, safety, and increased environmental impacts as vessels explore new fishing grounds), which are not quantified.

The loss in value of landings is minimal or nil for many sites under Option 1 when the potential for displacement is taken into consideration. Only three sites (Central Fladen MPA, Solan Bank Reef SAC, and West of Scotland MPA) fail the displacement test for Option 1.

The estimated impact on direct GVA under Option 1 is £4.9–17.3 million, rising to £30.7–50.7 million under Option 2 (present value, costs discounted over the 20-year assessment period, 2022 prices). These impacts arise as a result of reduced landings due to the proposed management measures where fishing effort for particular gear types would be restricted. When taking into account the knock-on effects on the supply chain to the commercial fisheries sector, the impacts are £6.4–22.5 million under Option 1 and £40.0–66.0 million under Option 2 (present value, costs discounted over the 20-year assessment period, 2022 prices).

Table NTS4 summarises the potential employment impacts on the commercial fisheries sector associated with estimated reductions in output. The potential loss of jobs related to the change in activity of UK vessels under Option 1 is between 9 and 34 full-time equivalents (direct and indirect), and between 61 and 101 under Option 2.

The average annual loss in the value of landings per site is shown in Table NTS4 and the distribution per region (based on CSSEG regions) is shown in Table NTS5^[3]. Values for Anton Dohrn Seamount SAC cannot be disclosed as they represent the activity of fewer than five vessels. The values are excluded from overall totals, however these make up less than 0.1% of the totals).

In Option 1, the fishing regions most affected in terms of value of landings are North Scotland Coast (£555 thousand–726 thousand per year); Fladen (£104–545 thousand per year); East Shetland (£0–430 thousand per year); and Rockall (£3–390 thousand per year). Under Option 2, the same regions are those most impacted, but Fladen has the highest value of landings affected (£2.7 million per year). In relation to the total value of landings from each region, those proportionally most affected are Hatton (100% Option 1 and Option 2)^[4], and Bailey (37–56% Option 1, 44–58% Option 2), in relation to the value of landings affected compared to the total value of landings from the region. Other regions with impacts to note under Option 2 are East Scotland Coast (10–11%) , Rockall (2–7%) and Forties (0–5%).

The sites that account for the greatest loss in the value of landings (assuming no displacement takes place) under Option 1 are Central Fladen MPA, Solan Bank Reef SAC and Pobie Bank Reef SAC. Under Option 2 (assuming no displacement takes place) the sites are Central Fladen MPA, Solan Bank SAC and Firth of Forth Banks Complex MPA. These estimates represent the ‘worst case scenario’ and is shown for all sites at the higher end of the estimate range presented).

However under each option some sites passed the displacement test for some or all gear types/segments. This means the fishing activity has been shown that it can take place within surrounding fishing grounds without significant impacts and the loss in value of landings will be reduced (shown for all sites at the lower end of the estimate range presented).

If fishing effort is displaced to the surrounding area potential effects include affected vessels being required to steam further to reach fishing grounds, fish on less productive grounds, fish harder to maintain catches which may result in potential changes to vessels cost and revenue profiles. Potential impacts are proportional to the amount of effort displaced, with greater impacts estimated where the displacement test is failed.

In sites where all mobile demersal gears have been excluded from the site or from areas within the site, this may provide an opportunity for static gears to operate in those areas. This may result in additional landings for those operators.

The costs of the proposed management measures under Option 1 would fall predominantly on the North Scotland Coast region, followed by the Fladen, East Shetland and Rockall regions. Under Option 2, the costs would fall predominantly on the Fladen region, followed by the North Scotland Coast, East Scotland Coast and Rockall regions. Under Option 1, the majority of impacts are on demersal trawls (81% of total Option 1), primarily in North Western Waters. In Option 2 the same gear types and regions are affected, arising predominantly for over-12 m vessels (99.8% of total under Option 2). This is mostly from demersal trawls in Northern North Sea Waters (79% of total under Option 2).

*N.D. = Value cannot be disclosed. Where no range is reported, this is because the affected fishing activity cannot be displaced to surrounding areas.

Value of landings per region calculated from the VMS dataset for over-12 m vessels only.

If percentage is less than 0.1%, this is indicated as ‘0%’. If percentage is 0.1% or more but less than 1%, this is indicated as ‘<1%’.

Distribution of economic costs and consequent social impacts, including downstream supply chains

The significance of the impacts depends on their scale relative to the size of the affected ports. The value of landings lost as a result of the proposed management measures represents a very small proportion of total landings for all home port districts affected under the lower end of Option 1. For the higher end of the Option 2, impacts are still relatively low, with most port districts estimated to have a reduction in total employment of less than 1%, highest percentage impacts are estimated for Orkney, Shetland and Fraserburgh. Impacts are more widespread under Option 2, with employment impacts as a percentage of total employment at the Port District are highest for Orkney, Fraserburgh, Shetland and Peterhead.

Management measures have the potential to affect the quantity of seafish and shellfish landed locally at Scottish landing ports. This could reduce the supply of locally-landed catch to fish processing facilities and the hotel/restaurant, retail and wholesale trades, and/or reduce confidence and hence investment in these sectors, in particular the fish processing industry, although reductions from some fleet segments may be offset by increases in landings from other fleet segments. The port with the largest proportion of the affected landings is Peterhead under both options, but in terms of landings affected as a proportion of current landings to the port, the most significant impacts on Scottish ports under Option 1 are at Aberdeen (up to 3.6%), Cullivoe (2.8%) and Kinlochbervie (2.4%). Under Option 2 the most significant impacts are at Aberdeen (13.8%), Kinlochbervie (6.6%) and Montrose (4.85%). Further details on the landing affects relative to total impacts and total landings at each part of landing are in Section 6.5.

There are also three ports or port districts (Fraserburgh, Shetland and Ullapool) that would be affected in terms of both the loss of landings to the port, and the loss of employment opportunities on vessels for which they are the home port. Therefore, they are at increased risk of adverse negative socio-economic consequences from the combined effects of the site management measures.

As described above, the social impacts identified are a consequence of the impacts on fisheries – both in relation to the home port of vessels (which is an indication of where revenues are realised and crews employed from), and the port of landing for catches (which is also linked to fish processing). The proposed management options have minimal impacts on fisheries in the lower end of Option 1, where restricted fishing activity is largely displaced to other fishing grounds. The impacts are more significant under the higher end of Option 1 (where all affected landings are assumed to be lost), but are not significant to the Scottish Economy. They create a risk of negative impacts in particular local communities. Option 2 has more significant impacts, as most of the activity affected (a total of £8 m of landings per year, and up to £4.8 m of annual direct, indirect and induced GVA) arises in a small number of ports that are rural or remote rural/island coastal communities.

The combined worst-case impacts from management options for a small number of sites could have locally significant adverse social impacts in specific coastal communities. There are some ports that are potentially affected as a port of landing and a home port, three port districts (Fraserburgh, Shetland and Ullapool) have notable combined effects in both these categories, and therefore are at increased risk of adverse negative socio-economic consequences from the combined effects of the site management measures.

Public Sector Costs

Table NTS7 presents a summary of estimated quantified cost impacts to the public sector.

The main potential costs identified relate to future monitoring and control (of fisheries activity) costs. There are a number of uncertainties surrounding the estimates of costs to the public sector, in particular, costs for additional monitoring from the UK Fisheries Monitoring Centre (UKFMC), the number of pings that would result from an increased polling rate in the sites (as vessels currently fishing there with restricted gear types would likely avoid the sites when measures are in place), and additional surveillance activity.

Ecosystem services

Ecosystem service benefits and costs could arise on-site or off-site. On-site benefits are the result of protection of features through the proposed management measures. Off-site benefits include spill-over effects, where particular species (including commercial fish or shellfish species, and other protected biodiversity) have healthier populations inside the site, and this supports movement of individuals to areas outside the site. The extent of this effect depends, amongst other things, on the size of site, impact of management measures and mobility and lifecycles of the species concerned. Ecosystem service costs that could arise on-site, for example if alternative fishing activities (using different gears), enter areas where restrictions are introduced on existing fishing activities. Costs could also arise off-site – where a significant amount of fishing activity is expected to be displaced from the site to other areas there could be a negative effect.

The sites support a considerable range and value of ecosystem services, but evidence on the baseline condition of the site features, and on the expected nature of these changes in scientific or economic terms, is incomplete and uncertain. As a result, the assessment of changes in ecosystem services at individual sites is uncertain. The potential management options would likely increase the level of several provisioning services, including fish (and shellfish) for human consumption, in particular from protection of seabed habitats and food webs that are important to key stages (e.g. spawning, nursery grounds) in species life cycles.

Two regulating services have been assessed - carbon sequestration and waste assimilation. The latter is not considered significant for most sites. Protection and potential recovery of seabed habitats could increase carbon storage in seabed sediments, but this is highly uncertain.

Cultural services including recreation and benefits stemming from spirituality, health and wellbeing, and creativity and art, and protection of genetic marine resources may be enhanced by the management options through their overall contribution to marine ecosystem health. They are not assessed at a site level. The most significant cultural value is the benefit to people in Scotland of managing a healthy marine environment. Available economic valuation evidence suggests that the value of this benefit is significant, but does not support calculation of a monetary value for the expected impacts.

The displacement of fishing activity from the sites could result in detrimental effects on the ecosystem services provided by the areas it is displaced to, but these effects would, in general, be expected to be less than the benefits in the sites because:

• The effort will usually be displaced to larger areas, so would be spread more thinly, than the proposed fisheries management measure areas (notwithstanding other constraints on where fishing activity can move to, considered in the cumulative effects);
• The areas that fishing effort is displaced to would, overall, be expected to have less sensitive and/or less significant marine conservation features, as this should be the basis for site identification.

Uncertainties

All of the estimates of costs and benefits are subject to significant uncertainties. The range of impacts vary greatly depending on the management option and assumptions applied. The extent to which fisheries landings affected will be lost, or the activity will be displaced to other areas, and the consequential impacts of this displacement, are uncertain. In addition, the consequential socio-economic impacts in remote or fragile communities may have the potential to be greater than the estimates presented in this assessment.

The benefits assessment is subject to uncertainty and it has only been possible to develop qualitative estimates of potential benefits for ecosystem services. Nevertheless, this assessment suggests the benefits are significant, and that they would provide value to people in Scotland, through support for future commercial fish stocks, and through the benefit to people of managing a healthy marine environment.