13 December 2019
Executive Council discussed next steps for fish processing and sales on St Helena at their meeting on Tuesday, 10 December 2019.
Over the last five years a total of £1,387,000 has been provided as operational subsidy by Government to the St Helena Fisheries Corporation (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.
A Fisheries Task Group was set up to undertake a review of the current fish processing and sales on St Helena. Following a period of consultation with key stakeholders including the SHFC, St Helena Commercial Fishermen’s Association (SHCFA) and local fishermen, the draft alternative business model put together by the Group in October was deemed to be an unprofitable and unworkable solution at this time.
SHG has this week received a request from the SHFC for a further sum of £182,000 to see the operation through to the end of the current financial year. This means that the total subsidy required for the current financial year to keep the operation afloat will be £532,000. This request is not affordable. With this in mind and noting that there is no significant level of subsidy available to keep the current fish factory afloat it was agreed that the SHFC in its current form will come to an end on 31 January 2020.
While we do not have the desired alternative business model in place it is encouraging that there are a few proposals in preparation that might be a solution to the ongoing issue.
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. SHG is therefore now asking the SHCFA and other investors to submit their proposals by Friday, 10 January 2020. These will then be considered by the Investment Enabling Group by 20 January. If a workable solution results from the proposals submitted an alternative operation will need to be in place from 1 February or as near to that time as possible. If none of the solutions proposed are workable SHG will allow the sale of fish directly from licenced boats to consumers. All boat owners have been approached by Public Health to be licenced if the need arises to move to this option. SHG has on this occasion already waivered the licence fee for Public Health approval.
All boat owners should therefore seek to have the appropriate certification in place before this date. Any boat owner without this certification by 1 February will not be permitted to sell fish to the public.
Notes to Editors:
Following an urgent application from the St Helena Fisheries Corporation (SHFC) to Executive Council (ExCo) in September this year, 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.
Further background can be found at: https://www.sainthelena.gov.sh/2019/11/draft-alternative-business-model-for-fish-processing-and-sales-on-st-helena-the-present-status-and-next-steps/.
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13 December 2019