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Archive for March, 2012

It is now certain that due to our bungling and incompetent Minister and her fisheries department, South Africa will lose all fisheries patrol and research vessel capabilities this weekend. Another tragic and historic milestone achieved by our government.
Come Sunday morning, April 1 2012, South Africa will awake to the first time in history since the regulation of fisheries began in the last century, where we will not have any fisheries patrol and research vessel deployment capabilities. And this despite us having some of the most advanced research and patrol vessels in the world.
It is almost incomprehensible that a Minister can effectively collapse a country’s entire fisheries management regime and not be held to account for such incompetence and blundering. Will she not be fired?
It is now certain that with the termination of the hull and indemnity insurances over the vessels and the handing back of the SAMSA safety certificates, South Africa’s oceans are now officially open to poaching just as is the case with Somali waters. We therefore could be considered a failed state as we are now the only state on the planet to share Somalia’s “open water” regime.
Further, the critically important demersal research cruise which is scheduled for next week may not be able to occur. This research cruise assesses the state of our hake, horse mackerel and other demersal stocks, allowing scientists to advise the minister to set viable catch limits for the 2013 season in sectors that land fish worth some R3.5 billion and employ some 12,000 people.
It is unlikely that our 8 fishery patrol and research vessels will be capable of setting to sea within the next 1 month. The world’s fishing pirates will surely be rubbing their hands in glee at the prospects of raping our oceans thanks to our Minister and her dysfunctional department.
And even if we manage to remove the vessels from the merchant shipping registry and onto the naval registry, there has not been any formal handover of skills and knowledge from the SMIT Marine crew to anyone else. And as we now know, a ship is not a tractor where one driver can simply hand over the keys to another.

SCA Upholds Transfer of Rights Fishing Policy

In two separate judgements issued on 28 March and 29 March 2012, the Supreme Court of Appeal ruled that the Transfer of Commercial Fishing Rights Policy of 2009 was valid and rational policy and accordingly rejected the appeals by fishing companies, Foodcorp and Oceana.
The judgements effectively confirm the validity of the Transfer Policy and provide important light on the prevailing relevance of transformation and black economic empowerment in the fisheries sector. The judgements also rely extensively on the General Fisheries Policy of 2005 and the Constitutional Court’s 2004 pronouncements on transformation in the Bato Star matter.
The judgements are extremely important for fishing companies as they continue to invest and purchase fishing quotas through commercial transactions involving the purchase and sale of members’ interest and shares in corporations. These transactions will impact on future applications for quotas in 2013, 2015 and eventually in 2020.
Fishing companies engaged in such transactions will be well advised to properly structure their transactions and seek the applicable authorisations from the fisheries department as stipulated by the General Fisheries Policy and the Transfer Policy.
However, what the judgements do not address is the fact that although the policies are valid and binding, we continue to be faced by a department and minister incapable of taking timeous decisions. The continued failure to dispose of transfer applications (with some applications remaining undecided for more than 2 and 3 years) continues to force fishing companies to ignore the regulated procedures as they seek to survive and avoid liquidation or collapse.
In this regard, Feike’s advice is to force the department and its minister to do the job they are paid to do and flood them with positive interdict (or mandamus) applications, which are relatively inexpensive and can achieve a rapid result. It is our view that the failure to decide a transfer of fishing right application that has been with the department for more than 6 months amounts to an unreasonable delay in terms of our law and is therefore reviewable.

Press Statement by SMIT AMANDLA

This is a press statement issued today by SMIT Amandla regarding the hand-over of the fisheries patrol and research vessels. It is important to note that the department gave SMIT less than 2 weeks notice to handover the vessels, whereas an orderly and effective handover would have taken some 90 days. Suffice-it-to-say, our vessels face mothballing as we have no trained crew or personnel to take over from SMIT and the vessels will not have any insurance cover from Sunday morning. And we have a Minister who refuses to speak to the public about this catastrophe that she and her incompetent department has created. She clearly does not have any solution other than to bury her head deep in the sand and pretend there is no crisis.
SMIT Amandla Marine (Pty) Ltd’s ship management contract with the Department of Agriculture, Forestry & Fisheries (DAFF) expires on 31 March 2012. The contract entails the manning, maintenance and management of the State’s fleet of fisheries research vessels (‘Africana’, ‘Algoa’, ‘Ellen Khuzwayo’) and patrol vessels (‘Sarah Baartman’, ‘Lilian Ngoyi’, ‘Victoria Mxenge’, ‘Ruth First’).
Since receiving the written instruction from the Director General of DAFF on Friday 16 March 2012 confirming that the vessels are to be handed over to the Department on 31 March 2012, we have executed a complex schedule of activities and have offered our full support and co-operation to DAFF personnel assigned to the handover.
We have contracted independent third party marine surveyors to verify onboard inventories and conduct condition and bunker surveys. Last week, we also provided the Department with a full risk assessment on the handover process – which was originally allocated 3 months in the ship management tender. Key concerns, amongst others raised by our company, have included:
· Time allocated by DAFF for the vessel handover.
· Familiarisation of vessels and operations for the new crew and technical support staff.
· The expiry of Hull & Machinery and Protection & Indemnity insurance for the vessels at midnight on 31 March 2012.
· The imminent return of all vessel certificates to the South African Maritime Safety Authority at their instruction and the implication of this on continued vessel operations post 31-March.
Since 16 March, we have increased security on all vessels as a precautionary measure. The protection of the fleet and a professional handover is our primary concern.
The vessels are due to arrive in Simonstown during the course of the day today, where they will be handed over to the Department’s delegated representatives by 31 March 2012. All SMIT Amandla Marine crew remaining onboard are scheduled to sign-off their respective vessels on Saturday.
For our team at sea and ashore involved in this contract, this has been a challenging period, not least because of the employment uncertainty post-31 March as well as the multiple tasks to be completed within 15 days so as to ensure a professional vessel handover to the DAFF by midnight on 31 March 2012. Mariners will know that every ship they work on becomes a home-away-from-home and many of our seafarers have served on these vessels for more than a decade; leaving them will not be easy. We pay tribute to our employees and thank them for their professionalism, dignity and commitment.
As a black empowered company in a highly specialised sector, supporting the State’s maritime interests is a priority. We would like to thank the team at DAFF for the opportunity we have had to manage these vessels which have sustained 170 jobs for South Africans and have been a platform for the development of scarce seafaring skills for the South African Maritime Industry, also supporting a successful Cadet Training Programme.
We look forward to an opportunity to provide continued support to DAFF and to tender for this service in the future, and we thank all of our Clients in South Africa and Mozambique for their support.

Sekunjalo Rejects Insider Trading Allegation

Black economic empowerment company, Sekunjalo Consortium, has strongly rejected accusations by the DA that it may have manipulated the share price during the time it was awarded a lucrative government tender. See www.moneyweb.co.za for the full story.

The Views of an Insider

A reader of the Feike blog submitted this interesting little gem.

“Come 00h01 on April 1st, what poor sole will be left trying to save face for Tannie Tina?
With less than a week to go (Ed: Actually 3 days now) until the return of research and patrol boats to the Department of Agriculture, Forestry & Fisheries, there is still no word on just how the SA Navy will ensure a “seamless” fisheries research and patrol service, as promised by our Minister (ed: The Department refuses to comment as their heads are too deep in the sand).
Fisheries operational staff tip-toeing the Foreshore corridors themselves have no clarity on what “the plan” is. All we know for sure is that come midnight on Saturday, we will have our hands full trying to come to terms with the effective management of assets worth more than R1 billion, with mounting public pressure to deliver on Tannie Tina’s promises to the taxpayer.
Oh, if only a boat were like a tractor, this would all be very straightforward. We would pick up 8 sets of keys and hang them up in the Acting DDG’s office. But we learn that a ship is a far more complex beast, which is why they are fondly called ‘she’. According to the maritime agency SAMSA, an ocean of international legislation and flag state requirements have to be met before the boats can even go to sea under DAFF and the Navy’s control. We are now aware that even the insurance expires at midnight on Saturday but no matter how wildly the red flags are waving, Tannie Tina just sees red herrings.
Perhaps the Minister – in her infinite wisdom – will spare her poor school of snoek at Fisheries a thought as she relaxes at the Cape Town Jazz Festival this weekend. Many of us wonder if, like last year (Ed: And in 2010), she will be a guest of Sekunjalo Investments? Clearly nothing fishy there as she declared the “gift”
(Ed: See http://www.parliament.gov.za/content/2011_2012%20MI%20Full%20List.pdf, pg 81 & http://www.parliament.gov.za/content/2010Disclosure.pdf, pg 73).
(Ed: In 2010 the Minister received 10 tickets and 6 tickets in 2011 with “unknown” values – hard to believe the Minister could not calculate the value of these 16 tickets).

JSE to probe Sekunjalo Share Price

It has been reported today by Die Burger (www.dieburger.com) that the storm over the Department of Agriculture, Forestry and Fisheries’ suspect R800m tender – subsequently withdrawn due to irregularities – has reached the JSE, which has been asked to investigate possible insider trading.
The share price of Sekunjalo Investments shot up from 40c to 79c per share shortly before the tender announcement. The price dropped significantly after Smit Amandla Marine started litigation in December 2011 to stop the awarding of the contract to Sekunjalo. The DA’s Pieter van Dalen said the fact that Minister Tina Joemat-Pettersson officially declared that Sekunjalo was ‘an innocent party’ during a media briefing on 21 March 2012 was suspect in itself. The party referred the matter to the JSE, which in turn indicated that the investigation would be referred to the relevant directorate if any abuse was found. Sekunjalo chief executive, Khalid Abdulla, denied any irregularities and asked for proof. The spike in his company’s share price was due to market forces, he said.
You may recall that on 17 January 2012, the Minister of Fisheries was frothing at the mouth trying to convince the fishing industry that her department was able to get itself ready and allocate commercial fishing rights come next year. If we recall further, Feike had directly questioned the department’s ability to timeously allocate commercial fishing rights across some 8 commercial fishery sectors by 2013.
At the time, Feike issued a stern response noting 5 reasons why the Minister and her department could not be trusted to ensure a timeous and sustainable quota allocations process (See http://feikemanagement.blogspot.com/2012/01/daff-says-there-is-enough-time-for.html).
Well, now we add reasons 6 and 7.
6. The Minister now admits that her totally dysfunctional and possibly corrupt department cannot even get its act together to issue a single tender to protect and manage our extremely valuable commercial fisheries. And instead of committing skills, money and other resources toward preparing for the next round of fishing quota allocations, her department will now be paralysed by historic tender allocation witch-hunts and “committees of inquiry”.
7. The Minister has placed a moratorium on all tenders which means that with less than 20 months to go before fishing rights in most of the fisheries concerned expire, the Minister’s dysfunctional and possibly corrupt department (in whom she says she has complete faith!) can’t seek outside expertise to help it get ready for the next round of long-term commercial fishing rights. (Actually, we are not sure if this is a bad thing or good thing ’cause who knows to whom they may hand out a tender? Perhaps another fishing company to oversee the allocation of fishing rights!)
So, here we have a thoroughly dysfunctional department led by a Minister who has committed substantial time and energy over the past month screeching about moving fisheries to Pretoria so as to equitably spread fish across the country(!) but demands that we trust her department to allocate long term fishing quotas worth billions of rands come next year. I am more inclined to believe in the existence of the Easter Bunny.
The Minister though has attempted to silence the growing chorus of criticism against her by foolishly decreeing that she and her departmental officials will firmly stick their heads in the sand from now on and not answer the rapidly growing list of questions on her leadership ability. Apparently everything related to fish is now “sub judice“!
Feike’s advice to the 1200 right holders in the traditional line fish, abalone, shark demersal, large pelagic, KZN prawn trawl, trek net, squid, hake handline and tuna pole sectors is that they ought to be gravely concerned as there is a real prospect now that their rights will simply be allowed to expire thus prejudicing their millions of rands in investments and the more than 11,000 jobs sustained by these fishery sectors.

6 Days to Go

With six days left before the end of March 2012, our Fisheries Minister continues to bury her head in the sand and not tell South Africa what will happen on 1 April 2012.

Cartoon of Fisheries Minister

This Cartoon appeared in the Cape Times on 22 March 2012. We think it most apt!

DA Statement on Committee of Inquiry

This press statement was issued by the Democratic Alliance:

Minister Tina Joemat-Pettersson yesterday announced that she will be instituting an independent inquiry into the procurement processes and procedures at the Fisheries branch of her department. Given that the move is an acknowledgement of alleged irregular processes, the DA welcomes the initiative. As the minister is politically accountable for the department, the announcement essentially constitutes an admission of guilt. The DA is encouraged by the Minister’s humility.
In order for the inquiry to be credible, however, its legitimacy should be secured in the following manner:
· The minister should appoint an opposition member of parliament, preferably myself, to serve on the committee. This act of good faith is a strong signalling device that the minister takes the investigation seriously. It has also served the DA well in similar contexts in Cape Town, giving teeth to inquiries which may otherwise be mere political point-scoring exercises.
· The terms of reference and/or scope for the inquiry must be made public, including a reassurance from the minister that she intends to take appropriate action in light of the investigation’s outcomes and recommendations.
· The minister must ensure that the results are made public. Ultimately, taxpayer’s money is at stake in any tender process, and tenders to the value of R800 million, for instance, must be impeccably administered.
Independence is indeed a necessary condition for credibility, and the minister’s emphasis to that end is to be commended. However, it is not a sufficient condition. Following the above recommendations will indeed make the inquiry credible. As the minister has previously taught us, persuasiveness is impossible without credibility.
In the same vein, then, the minister should retract her assertion that ‘from now until the Committee concludes its investigation, [the department] will cease to respond to or entertain any further allegations or queries as those would now be in the jurisdiction of the Committee’. Both the public protector and the competition commission will be investigating the department’s tender processes. The minister should clarify that her department will be cooperating fully with both these endeavours.
Finally, the minister argued that Sekunjalo is an ‘innocent company’. Sekunjalo is a politically connected consortium that won the R800 million tender which sparked this whole debacle in the first place. Thanks to DA pressure, the contract has now been withdrawn. The minister has no legitimate grounds on which to declare Sekunjalo’s innocence, though. Its decision to not take legal action against the department is hardly evidence of innocence. If anything, the company’s failure to sue suggests otherwise.
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