3. RECURRENT AND OPERATING COSTS OF COMPONENTS

3.1 Personnel
3.2 Administration and coordination
3.3 Vessel monitoring systems
3.4 Patrol platforms
3.5 Costs to fishermen
3.6 Distribution of costs by activity

3.1 Personnel

In general, the higher the incomes in a country, the greater will be the proportion of the recurrent MCS costs attributable to staff. Thus personnel costs of the US Coast Guard are approximately 14 percent of the total recurrent budget, while the cost of personnel in Mauritania represents seven percent of patrol vessel operating costs. In Scotland, where fisheries enforcement is operated by a parastatal, personnel costs account for over 50 percent of the recurrent budget, indicative of substantial cost savings on non-personnel operating costs. In Namibia, which is considered to have a strong MCS capability just over 50 percent of the total fisheries administration staff are engaged in fisheries ‘operations and surveillance’ and a fisheries inspector is paid approximately US$10 000 per year[15].

Salary ranges vary widely with chiefs and directors earning up to eight times the salary of a fisheries field officer, or inspector. Within the Mauritanian navy, the commander of a patrol vessel earns 2.3 times the salary of a seaman, while in Namibia a field officer may earn more than a ‘chief’ as a result of overtime payments. Patrol vessels may also need more than one crew in order that the vessel remains at sea during several consecutive missions.

To counteract the potential negative effects of low salaries (e.g., corruption) some fisheries administrations offer incentives for the successful arrest and penalization of fisheries offenders. In Mozambique, a proportion of revenues from both licence fees and fines are paid to fisheries inspection staff. Similar schemes exist in several West African countries. Other bonus, or allowance payments may be required for time spent at sea, or on field patrols.

There is a need to continually upgrade the skill of MCS staff. The cost of this training may be five-seven percent of the personnel budget (salaries and benefits). A number of countries appoint honorary fisheries inspectors/officers using retired officers, village chiefs, or respected fishermen as a low-cost solution for gathering local intelligence on fishing activities.

Observers. A distinction must be made between scientific observers and observers with an enforcement role. The scientific observers often have a higher educational level (e.g., qualified biologists) and a higher cost. Three types of fisheries observer programmes exist in the FFA region. A regional observer programme operates under the United States Multilateral Fisheries Treaty for the 33 purse seine fishing vessels fishing in 2001. A sub-regional programme is operated under the Federated States of Micronesia (FSM) Arrangement for 15 locally-based purse seine vessels. Several FFA member countries operate national observer for foreign vessels fishing in their respective EEZs.

The fishing vessel operators fully fund these latter observer programmes as follows: (i) salary for the observers approximately US$25-45 per day, depending on level of experience; (ii) air fares to and from the point of placement (port of boarding/disembarking) and (iii) insurance while the observer is on board the vessel.

The United States Treaty observer programme covers 20 per cent of all vessel trips, each trip lasting approximately 6-8 weeks. An annual allocation of US$150 000 is budgeted for observer placements each year under this programme, while US$25 000 per year is budgeted for placements under the FSM Arrangement Observer Programme. Under the United States Multilateral Treaty, the United States also finances observer training to the value of approximately US$30 000 per year.

Namibia places two observers from its 200-strong observer corps on board each of the larger fishing vessels. The observers do not have an enforcement role, are not public servants, and are paid approximately US$4 300 per year through an accounting firm contracted to collect the ‘observer levy’ from the fishing vessel operators. This scheme is now being replaced with a Fisheries Observer Agency and annual salaries will range from US$3 530 to US$7 510 (including benefits). The total annual cost of the revised scheme is estimated at US$1.9 million, financed almost entirely by the industry.

Trained aerial observers in West Africa (regional project) are paid US$30 per mission day and per diem allowance when outside their home country in addition to their regular salaries as national fisheries officers.

3.2 Administration and coordination

As the administrative tasks associated with MCS are closely inter-twined with numerous other administrative tasks, the associated costs are difficult to isolate. No attempt is made to identify such costs in this paper because of the wide variety of organizational arrangements within fisheries administrations, and the fact that MCS administrative costs are generally no different from other administrative costs. However the cost implications of certain emerging trends are worth noting:

• the effective use of quotas as a fishery management tool involves substantial costs not only in monitoring landings (catches), but in recording landings (catches) and possibly instituting mechanisms to enable transfers of quotas;
• the recognition that coercive controls may be complemented, or even replaced by co-management or other mechanisms to involve fishermen implies increased costs in decentralization of fisheries management and maintenance of a constructive dialogue with fishermen and concerned stakeholders;
• globalization of trade and the need for product traceability and sanitary control requires increasing coordination between product inspection and control of fishing activities; and
• legal processes may incur substantial costs through use of time by senior staff in formulating legislation, preparing legal documents for courts, or tribunals, and explaining fisheries regulations to fishermen.

3.3 Vessel monitoring systems

Operating costs depend both on the type of VMS system and the frequency of usage, or polling of the fishing vessels. The operating cost[16] of the FFA’s VMS is approximately US$845 per vessel per year (polling every four hours), equivalent to 0.05 percent of the annual value of production of the targeted tuna fishery, or approximately 0.3 percent of the operating cost of a tuna purse seine vessel operating in the region. Recurrent costs of VMS in the USA are estimated to be about $410 per vessel. The following table illustrates the cost savings in the Hawaiian longline fishery through use of VMS.

Table 3.1: Comparative pre- and post-VMS annual control costs of a closed area[17]

Pre VMS (million US$) costs		Post VMS (1 000 US$) costs
3000 patrol vessel hours/US$1 000/hr	3.0	110 patrol vessel hours	110
350 air hours (C-130)/US$7 500/hr	2.6	8 air hours	60
		VMS costs	200
TOTAL	US$5.6 m	TOTAL	370

A total sea area of 160 000 nm² in two separate zones were closed to the Hawaiian Islands pelagic longline fishery for tuna and swordfish to protect endangered species (monk seal, turtle and albatross) and to reduce, or prevent gear conflicts with the valuable recreational fishery. Between 100-172 longline vessels were involved in the mid-1990s.

3.4 Patrol platforms

Maritime patrol platforms are often multi-tasked. Estimates of the costs of fisheries protection can be pro-rated based on the allocation of patrol time by the coast guard, or agency responsible for the patrols. The patrol time of a typical coast guard surveillance platform may be divided among the following peace-time duties:

• enforcement of sovereignty, and search and rescue, both of which always take priority over fisheries tasks;
• fishery and resource surveillance and protection;
• customs controls, immigration checks, and general control of the border and of visiting ships and protection of offshore installations;
• protection of the environment, including oil pollution;
• assistance to the police and other government agencies and supply to isolated islands;
• control of scientific, or exploratory activity;
• general safety at sea, vessel seaworthiness, reporting and elimination of drifting objects, and the protection of undersea cables.

3.4.1 Patrol vessels

Offshore patrol vessels. The operation of offshore patrol vessels is probably the single greatest cost item for fisheries MCS. A useful means of establishing the range of operating costs is through examination of the costs of patrol vessel charters.

The Falkland Islands Government charters two fishery protection vessels from the private sector, the largest of which is a modern 76m (LOA) vessel suitable for the rough temperate waters of the Southern Atlantic ranging from the Falklands to South Georgia. The annual cost for both patrol vessels is US$5.46 million (2001), or US$7 500 per vessel per day, of which fuel can account for approximately US$1 150 per day. In the recent past a long-term (two-three year) charter for a 65 m (LOA) patrol vessel cost approximately US$4 600 per day. Despite being operated by the private sector one vessel is armed. General charter conditions allow for 20 days maintenance per annum. Additional ‘downtime’ is not compensated. Vessels operate on fortnightly patrols; 13 days at sea, followed by one-two days in port. One vessel also undertakes fisheries research.

South Africa has chartered fully manned ‘trawler type’ vessels (Kuswags, 29 m) for fisheries and environmental protection at a daily rate of US$815 (1996), while Namibia has chartered[18] a fisheries patrol vessel at US$650 000 per year with fuel paid by charterer. Norway charters commercial fishing vessels for approximately US$1 400/day to identify and police closed areas in the Barents Sea. The Scottish Fishery Protection Agency avails of the services of Royal (UK) Navy minesweepers or similar military patrol vessels at a cost of US$7 500 per day (1997), while the estimated daily operating costs of South African military patrol vessels ranges from US$1 250 (400 GRT mines- weeper) to US$2 970 per day (Strike craft) in 1996.

The Pacific Patrol Boat Programme (currently 23 patrol boats operating in 12 FFA member countries) has been reviewed[19] by the Australian Defence Force. Some caution must be exercised in relation to estimates of the cost of patrols by naval vessels. In an OECD country, where 90 percent of the naval activities and maritime patrols are fishery related, the navy estimates the average direct operating cost per vessel patrol day at US$7 500 (65 m minesweeper). However, this estimate excludes depreciation of vessels, paying multiple patrol vessel crews, costs of maintenance staff, training, and administrative overheads. If 90 percent of all recurrent costs are allocated to the fisheries task, the total cost per patrol day is US$27 600. In this case personnel account for 59 percent of costs, maintenance 39 percent, and fuel seven percent. Standardized operating costs of different US Coast Guard cutters are given in Annex 1.

Several mechanisms can be introduced to reduce the high costs of sea patrols. Rather than being obliged to escort an offending vessel to port, which incurs costs to both the fisherman and the patrol vessel, skippers (of national vessels) may be given the opportunity to sign an admission of a violation. If regulations indicate that certain fishing gears cannot be left unattended (e.g., longlines, or gill nets) the officer on the patrol vessel may be authorized to haul and confiscate the unattended gear. A checkpoint system (entry/exit corridors) for vessels entering, or leaving designated fishing zones is becoming well-accepted by fishermen and may offer a substantial cost saving for sea controls.

Table 3.2: A percentage breakdown of estimated operating costs (excluding personnel) on a range of Mauritanian fishery patrol vessels (2001)

Cost item	Inshore (10m)	Coastal (18m)	Offshore (>25m)
Fuel and oil	22	18	39
Local operating expenses	67	44	19
Insurance		14	9
Repair and maintenance	11	18	33
Classification		6	0.2
Total relative costs - inshore = 1	1	6	27

Coastal and inshore patrol vessels. The smaller vessels offer a number of cost advantages to the fishery administration. Spare parts and repairs may be available locally avoiding costly trips to foreign dry docks, or delays due to shortage of foreign exchange. A somewhat less skilled and less costly crew may be adequate. Actual operating costs will vary widely in accordance with local wage rates and fuel costs and are not detailed in this report.

Fleet support vessels. To remain on the fishing grounds for extended periods many fleets operating in developing countries are supplied with fuel and deliver fish to transport vessels. These reefer, bunker, or fresh fish collection vessels can serve as a cost effective control point by placing fisheries inspectors permanently on board, or by requiring such vessels to moor and operate at designated locations. Control of these vessels, which may require international collaboration, can also mean additional public revenues from fuel taxes and import of supplies.

3.4.2 Aircraft

The following table details charter, or operating costs for maritime patrol aircraft in recent years. Accommodation for crews of leased/chartered aircraft can add substantially to the daily cost if the aircraft is operating from several different base airports.

Table 3.3: Examples of hourly costs for aircraft used for fisheries patrols (in US$/hour)

Aircraft	Details	Charter	Total
Twin Otter DHC-6	Senegal Armée de l’Air	720	870
Dornier 228	Cape Verde Guarda Costeira	700	750
Y12	Mauritanian air force	500
Cessna 406	Southern Africa		705
BN Defender Islander (2)	Falkland Islands government (760 hours/yr)	770	770
BN Islander (Feb. 2000)	West Africa/Luxembourg company	1 000
Dornier (civilian)	Norway chartered 450 hours in 1999	1 385
P3-Orion	Norwegian air force aircraft (multipurpose patrol)		7 600

In Namibia (1996) a Cessna 406 was operated for US$275 per hour excluding crew salaries while a helicopter, operated at US$2 280 per hour, was not considered a cost effective solution for fisheries protection. Annual operating cost of the Norwegian Coastguard’s six helicopters is in the order of US$5.2 million. Because of the high maintenance requirements, only 50 percent of the helicopters are normally operational.

The estimated operating cost of the CASA aircraft (OECD country) is US$945 per hour, excluding the cost of personnel, which, if included, almost double this cost to US$1 708 per hour. Two such aircraft operated by the air force require up to 30 staff, including three air crews (five-six per crew including photographer), a maintenance team, air traffic/runway control, and manning of the operations room.

3.5 Costs to fishermen

MCS imposes both direct and indirect costs on the fishermen, or vessel operators. Every restriction on the fisherman’s activity incurs a cost, i.e., compliance with a regulation is likely to incur a cost to the fisherman. While no empirical information is available on the costs incurred by fishermen in developing countries as a result of control measures, some consideration of the costs of MCS to the fishermen is of value. If the costs of compliance are high then violations may also be high. Assessment of these costs can be carried out by consultation with the fishermen, or by specific studies[20].

Several different types of costs can readily be identified. Direct costs occur if new regulations require gear alterations (e.g., if a larger mesh size is necessary). Similarly, installation of VMS may incur capital costs of over US$5 000 per vessel and recurrent costs of US$400-1 000 per vessel per year. Loss of fishing time and fish quality through delays and inspections, fines, forfeitures[21], and legal costs impose a financial burden on the vessel operator. There are costs associated with maintenance of records required for control and reporting purposes, and increasingly complex regulations require vessel operators to invest time in their interpretation and discussion with authorities. At the artisanal level negotiation of co-management arrangements may require lengthy discussions and local meetings.

Indirect costs accrue as fishermen expend substantial time and effort searching for fish concentrations outside closed areas, or to avoid prohibited by-catch. Anthropological studies[22] indicate several less-evident social costs as fishermen monitor each other’s behaviour, thus leading to social tensions particularly in small communities. Other hidden costs result from uncertainty regarding constantly changing regulations and the consequent inability to plan the fishing business, both in operational and financial terms.

Fisheries administrations rarely attempt to recover, or internalize direct control costs, which means the fishermen have little concern over the efficiency of control activities. Indicators[23] of impact for fisheries control need to be developed as neither the direct costs of control, nor the costs to the fishermen of the fisheries management measures and controls have been a major focus of attention outside of politically-charged fishermen/fishery administration discussion.

3.6 Distribution of costs by activity

3.6.1 Total MCS costs

The following table provides estimates of total costs of MCS in relation to selected indicators in the SADC region. Mauritania spends approximately two percent of gross revenue[24] from fisheries on fisheries protection. A budget of US$16.5 was submitted for the 1998-2001 period.

Table 3.4: Estimated recurrent costs of MCS in the SADC region in 1994

	Angola	Mozambique	Namibia	(U.R.)Tanzaniaa	South Africa
Value of landings (million US$)	50	93	333	38	513
Estimated costb of MCS (1 000 US$)	30	282	8 244	103	9 725
MCS as % value of landings	0.1%	0.3%	2.5%	0.3%	1.9%
MCS as % of value of exports	0.1%	0.4%	2.5%	0.7%	3.6%
MCS costs US$ per 1000 km2 of EEZ	50	501	16 357	463	9 262
MCS costs US$ per km of coastline	18	101	5 496	72	3 377

Source: EBCD/GOPA, 1996. a) Refers to marine production/MCS only for both United Republic of Tanzania mainland and Zanzibar. b) Costs exclude donor contributions.

Table 3.5: Breakdown of MCS operating expenditures in different administrations (percent total expenditure)

Expenditure item	Mauritania % (excluding personnel costs)	Madagascar % (incl. Personnel costs)	Scotland % (including personnel costs)	Average of five OECD countries (incl. personnel)
HQ/administration	17	22	13	10
Field offices	8 (3 offices)	8	23 (coastal/ports)	25(coastal)
Communication centres	1
Factory controls	0.04
Patrol vessels	62	32	49	51
Patrol aircraft	12	16	11	13
Radar stations	1 (3 stations)	17
Legal actions			2
Other		6	1

Sources: Mauritania. Budget information, 2000; Madagascar. project document, 1997; Scotland. Accounts, Scottish Fishery Protection Agency (1998-99).

Table 3.6: Breakdown of Norwegian MCS costs by institution, 1999 (percent)

Directorate of Fisheries	10.7
Coast Guard	86.6
Prosecutor/judicial offices	0.4
Fish sales organizations	2.1
Fishermen’s organizations	0.3

Table 3.7: A breakdown of MCS costs by activity in an OECD country, 1999 (percent)

	Offshore	Inshore/coastal	Coordination/administration	Total
Aerial surveillance	22			12
Other operations	13	14	21	15
Depreciation	11	11	10	11
Staff costs	53	75	69	62
Total	55	32	13

3.6.2 Artisanal co-management

Developing co-management regimes, which harmonize the traditional approaches to fisheries management with modern fisheries legislation, is a lengthy process involving training of extension agents and fisheries officers in new approaches such as participatory processes. Devolution of selected fisheries management functions to provincial, district, or community level takes time and effort and may include awareness campaigns, efforts to curtail, or eliminate destructive fishing practices and create alternative employment, and to develop marine parks, or marine protected areas.

3.6.3 International agreements

Establishing and maintaining international fisheries agreements and organizations incurs costs related to attendance at meetings, annual contributions, possible changes in legislation, and enforcement obligations. However, the history[27] of the Fisheries Enforcement Agreement between the United States and Canada shows how the absence of an agreement on fisheries enforcement can result in substantial costs to fishermen, to the fisheries administrations, and in terms of a loss of political harmony.

Examples of agreements directly related to MCS include: the Nauru, Niue, and Tonga/Tuvalu agreements in the South Pacific; hot pursuit agreements in the area of the Sub-Regional Fisheries Commission in West Africa (from north to south: Mauritania, Senegal, Cape Verde, the Gambia, Guinea-Bissau and Guinea), the recent SADC Protocol on Fisheries (Southern Africa and some Indian Ocean countries).