20 November 2019
Following an urgent application from the St Helena Fisheries Corporation (SHFC) to Executive Council (ExCo), requesting additional subsidy to fund repairs to equipment in the Fish Processing Factory, Elected Members instructed the formation of a Fisheries Task Group. The Task Group was set up to undertake a review of the current fish processing and sales on St Helena, and present an alternative business model to ExCo on 29 October 2019. The key focus for the Group was to produce a model that curtails the crippling losses incurred by the SHFC with a view to reducing the subsidy provided to it by taxpayers.
Background
Over the last five years a total of £1,387,000 has been provided as operational subsidy by Government to the SHFC and the operation continues to report financial losses year on year. The SHFC’s business model has been broken for some time but masked by SHG paying out ever growing levels of subsidy to the fishing sector on an annual basis. This is money SHG can no longer afford. The fish factory has not made any profit for several years, it continues to build up ever-increasing losses, in the forlorn hope that it just might earn some cash from overseas sales to pay back the hundreds of thousands of pounds that have been sunk into the venture. In 2019 alone in nine months of the financial year the SHFC has used up a subsidy of around £450, 000 with nothing but even more losses to show for it.
The time has come for everyone, SHG, the SHFC, the St Helena Commercial Fishermen’s Association (SHCFA), all Fishermen and every resident of St Helena to realise that this cannot go on. A fundamental change in the system of fishing on the Island is needed with the adoption of a business model that, at the very least, has a fighting chance to break even. The SHFC and SHCFA have been asked repeatedly to propose, individually or collectively, a better way forward and to date neither entity has been able to produce a plan to address the serious losses.
In the absence of an alternative model from either entity, SHG’s Task Group in October, put forward a draft interim business model for a slimmed down fishing sector that has, as its first priority, sustaining a supply of fish to the domestic market. The draft model proposes an alternative interim business solution lasting between 6-18 months focusing on providing the local market with fresh and affordable protein and the possibility of fresh exports by air of premium grade tuna. The plan depicts options for alternative revenue streams and options for cost reduction.
ExCo recognised the draft business model was not perfect and improvements needed to be made if it was to be acceptable. ExCo requested the Task Group to engage with the SHFC and SHCFA, as well as individuals with an interest in fishing, to work together to see if the plan could be improved. Targeted consultation is being carried out with the SHFC (staff and members of Board), SHCFA and Fishermen. To date the Task Group have met twice with the SHFC Board of Management and are awaiting feedback as promised, they have also offered support to the SHFC Board of Management for staff engagement.
The Task Group is keen to meet with Fishermen to get their input, the Group would particularly like to understand from the Fishermen whether there are any alternatives to some of the assumptions proposed within the model. The Group recognises that the SHCFA is well-placed to work with SHG to help to build a more promising business plan for the future, however to date the Task Group has not been successful in securing a meeting with the Association.
The Task Group is now extending an invitation to all commercial fishermen to attend a meeting next Monday evening, 25 November 2019, in the Council Chamber at 5.30pm, to meet with members of the Fisheries Task Group, Councillor Lawson Henry and the Chief Secretary.
Copies of the draft Business Model are available from the Press Office and any Fishermen requiring a copy should contact: kerisha.yon@sainthelena.gov.sh or tel: 22368.
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SHG
20 November 2019