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In the Cape Times of 4 December 2009 (p3 – “Fishermen short-changed on promised compensation”), journalist Melanie Gosling writes that MCM continues to refuse to account to the public how R80 million allocated by the National Treasury allegedly aimed as “social relief” for the commercial abalone industry is being spent. Gosling also approached Anix Consulting – the consulting firm Feike identified as having mysteriously surfaced at about the same time the divers had their promised payouts reduced from approximately R100 000 to R20 000. Anix Consulting confirms that they were “given a contract with Water and Environmental Affairs”. If they were given a contract then they were appointed illegally and heads need to roll at MCM. In addition, Feike intends approaching the Special Investigations Unit regarding the increasingly apparent misappropriation of public funds.
The fact that MCM refuses to answer simple yet important questions about the role played by Anix Consulting, their terms of appointment and what they are being paid and also refuses to account for R80 million in public funds must raise clear concerns about the possibility of corruption, maladministration and mismanagement.
On 25 November 2009, the Minister of Environmental Affairs and her department launched the 2008/2009 compliance and enforcement report. As Feike had authored a research paper which concluded (but roundly denied by government officials) that illegal fishing cost the SA economy an estimated R6 billion in 2008 and that Marine and Coastal Management – a branch of the environmental affairs department – was incapable and unwilling to curb illegal fishing, I was particularly interested to understand the department’s initiatives and statistics pertaining to illegal fishing.
The entire report of 35 pages fails to mention the words “abalone” or “fish” or “hake” or “shark-fin”… or any matter related to fishing once! In fact the entire “compliance and enforcement report” is really only able to say this about marine and coastal management –

“Marine and Coastal Management (a branch of the Department of Environmental Affairs) recorded the highest number of convictions at 206.”

In fact Marine and Coastal Management is mentioned thrice in the entire report. There is no attempt at any analysis or recognition of the challenges and threats posed by illegal fishing and the more general lack of enforcement and compliance in the abalone fishery or the commercial fisheries, generally.
The full report is available on www.deat.gov.za.
Over Monday 30 November to Friday 4 December 2009, an international panel will be reviewing assessments of the local hake and abalone resources at a workshop being held at the University of Cape Town. The panel comprises Drs A Punt (USA), A Smith (Australia) and G Stefansson (Iceland).
While most sessions will be highly technical, with attendance by invitation only, the following sessions, to be chaired by Dr K Prochazka (MCM), will be open to a general audience:
Monday 30: 9-00 to 10-30 am – Hake
An overview of the approach used to set TACs for the hake fishery since 2007, and of an updated assessment proposed as the basis to revise this approach from 2011 (D Butterworth and R Rademeyer – UCT)
Tuesday 1: 9-00 to 10-30 am – Abalone
An overview of the status of the abalone resource, and a description of the model used to assess this status for Zones A-D (G Maharaj – MCM and E Plaganyi – CSIRO, Australia)
Friday 4: 11-00 am to 12-30 pm – International norms for fishery regulation
International norms for target abundance levels for fish stocks, and controls applied to stocks falling below such levels (Discussion session initiated by presentations by panel members)
Friday 4: Afternoon – Panel Report
Presentation of results of review and consequent recommendations by panel members
2-30 to 3-30 pm: Technical issues
3-45 to 5-00 pm: Broad overview
The broad overview will be presented at a level appropriate for fishery stakeholders and decision makers – there will be opportunity for some questions.
VENUE: Room M304, Mathematics Building, University of Cape Town
Enquiries: 021-650-2340

Mayekiso is removed as head of MCM

On 23 November 2009, Monde Mayekiso who was appointed as head of Marine and Coastal Management in 2005 for a second time in as many decades, was finally “moved to focus on the area of marine science, ecosystem management and climate change within the department”. Feike also understands that after months of indecision and embarrassment, South Africa actually will have a minister of fisheries that is actually responsible for fisheries regulation and management. Feike understands that the Minister of Agriculture, Fisheries and Forestry will assume control over fisheries, replacing the Minister of Water and Environmental Affairs who had appeared to exert executive control in this sphere since May 2009.
The fishing industry will undoubtedly breathe a huge collective sigh of relief that Mayekiso has finally been removed as he oversaw the collapse of MCM and its funding arm the Marine Living Resources Fund for a second time. Mayekiso was removed as head of MCM in 1999 by the then Minister of Environmental Affairs, Valli Moosa.
However, although there is relief at his removal, the question at this important time is who will assume the reigns of a vaguely functional MCM? MCM’s operational budget is equivalent in rand terms to the 2003/2004 budget. It has a massively oversized administration and personnel costs are excessive. It was recently forced to admit that its compliance strategies with respect to abalone have been a failure and it has no idea how to curb abalone poaching which currently costs the economy in the region of R3 billion annually. Fisheries management is in turmoil burdened with bureaucracy and a leadership that is incapable of supporting the fishing industry during these difficult economic times. Fisheries research is under significant pressure as it has had to reduce scientific surveys and keep research vessels in port.
MCM requires smart and efficient leadership at this juncture. The new DDG will require strong political support to effect the types of changes required to recover MCM and its funds to levels where it can actually provide the services the fishing industry pays for. A 5 step recovery plan should be based on the following:
Step 1: A visionary and knowledgeable leadership is required in significant dollops. MCM has been lacking visionary leadership for far too long hence its perennial crises.
Step 2: Reduce staff numbers in the administration and support sectors. You would probably save about R20 million in staff and office costs. Outsource the administration of permitting, licensing and vessel management to the fishing industry and right holders themselves. MCM need only audit compliance once annually at the end of the season. You would probably save another R10 million in wasted administration costs – not to mention all those trees that would be saved.
Step 3: Regain control over illegal fishing and maladministration in MCM. With respect to illegal fishing, there are two reasons why MCM has failed so entirely here. Firstly, with the commercial and artisinal sectors, MCM has no relationship at all with the right holders. MCM is on record, for example, as stating that all abalone right holders are poachers! Rebuild relations. Secondly, to get control over the illegal trade in abalone, the institutions and systems that existed in 2004 need to be re-established. Overall, MCM must move away from compliance enforcement to monitoring and surveillance with an emphasis on intelligence (!) gathering and partnerships.
An effective compliance strategy will actually cost MCM about R80 million annually as it will lose income from the sale of confiscated abalone. This would explain why MCM had intentionally collapsed compliance in the first place.
Step 4: Funding for fisheries management. If one discounts the R80 million plus that MCM currently relies on from the sale of confiscated abalone to a more sustainable R10 million, then MCM’s most significant income earner is from the fishing industry in the form of administration fees and levies. We would recommend a review of the basic funding model and allow the fishing industry a greater oversight and advisory role akin to other international jurisdictions, such as Australia.
Step 5: Rebuild working and effective relations relations with the South African fishing industry.
Here’s hoping.

Abalone Divers get R20 000

On 17 October 2009, President Zuma addressed the commercial abalone divers in Hawston, Western Cape, about the future of their commercial fishing rights. After hearing their stories and the failures of Marine and Coastal Management to address abalone poaching and the implementation of the long-promised “social plan”, Zuma underook to revert to the right holders with an update about their futures as commercial abalone divers ” within a month”. The time has now come for that promised update.

What has happened in the interim since Zuma’s visit is that abalone divers have received payments of R20 000 each in lieu of the suspension of their fishing rights since February 2008. There remains much unclarity regarding these payments and the manner in which they are being made. There are too may right holders who simply don’t have answers to important questions. Firstly, the payment of all funds is being facilitated through a trust that purports to represent all commercial abalone divers. Interviews conducted with a number of Zone E and G right holders appear to contradict this as they did not consent to the establishment of the trust. Secondly, Marine and Coastal Management has delegated all “co-ordination” and direct supervision over the payments and the trust to a Charles Swarts, who is a commercial abalone diver from the Overberg region. It is unclear why only one person has been given such authority by MCM (as opposed to by the divers themselves) especially considering that there are 12 active zonal representatives for each of the 6 abalone fishing zones, A, B, C, D, E and G. Thirdly, divers were initially promised a payment of R90 for every kilogram they were allocated in the 2007/2008 season, which amounted to approximately R52 000 per right holder. It is unclear why this payment has been reduced to R20 000 per right holder and who took this decision. A further related concern is the sudden appearance of the consulting firm Anix Consulting who has been appointed to manage the payment of the funds to the right holders. It is unclear how they were appointed as there is no known tender seeking the appointment of such a service provider. Anix Consulting’s status on the Companies & Intellectual Property Registration Office website also states that Anix Consulting is in the process of “deregistration” effective 14 November 2009. Subsequent to Feike’s queries on 16 November 2009, this status has now been changed on Cipro to “in Business” effective 17 November 2009.
Feike put the following questions to MCM’s Desmond Stevens in a bid to obtain clarity on the various issues raised above:

1. The trust that was established to channel the payments:
  • Who are the trustees of the trust?
  • How were they appointed and by whom?
  • In terms which provisions of which laws are funds being channelled to/via this trust?
  • Could you please provide me with a copy of the signed trust deed?

2. The R20 000 payments to abalone divers: It was initially understood that divers would be paid R90/kg or R52 000 (on average). Why are they being paid R20 000 only. Is this the sum total of the “social plan” payment? Please provide details regarding any further payments that may be intended.

3. Why does MCM require right holders only work through a certain Charles Swarts? Who appointed him and from whom does he have a mandate to represent. Could you provide a written copy of the mandate Swarts has?

4. Should MCM in fact not be the focal point of all communication, liaising and responsibility for the management and disbursement of public funds? Please also advise in terms which laws is Swarts and the trust authorised to disburse public funds?

5. The role of Anix Consulting. Could you please detail their role in this matter? Please also advise –
  • in terms of which tender/procurement procedure they were appointed?
  • what is the value of their contract and who is responsible for paying them?
  • who are their members/shareholders and/or directors
  • is MCM aware that their current CIPRO status indicates that Anix Consulting is in the process of deregistration?
Desmond Stevens elected to avoid answering any of the questions. He instead advised Feike to contact Charles Swarts. The response is significant as it demonstrates a flagrant disregard for accountability and good and responsive governance concerning the management of public funds and a public resource. Feike has advised Stevens that the information will be formally requested via the Promotion of Access to Information Act and we will also seek the assistance of a Member of Parliament who could force the Minister(s) responsible for fisheries to provide honest and complete answers to Parliament.
Zuma is still expected during the course of this week to update the commercial abalone industry as to whether they will be allowed to commence commercial fishing either in December or January 2010. Feike believes that a viable TAC of 212 tons could be granted to the industry. Any allocation must be coupled to a comprehensive compliance strategy that focusses on reducing the R3 billion in abalone estimated lost annually to poaching.

SA Government values abalone at R1000/kg

In a recent statement issued by Marine and Coastal Management and the South African police Service concerning the arrest of abalone poachers and the confiscation of some 3000 kg of abalone, it was stated that the confiscated product was worth R3 million. This admission is of course most interesting. In April this year, Feike’s Shaheen Moolla published a paper on illegal fishing in South Africa. That paper valued illegal abalone fishing to be worth an estimated R1,8 billion involving some 2500 tons of abalone worth an approximate value of R700/kg.

The paper was critiqued at a public peer review session as being a bit conservative on the estimated value and quantum of poached abalone. The paper is currently being revised and will show that during 2008 poaching continued to escalate. However, given MCM’s valuation of R1000/kg for illegal abalone, it does mean that in 2007 South Africa lost more than R2,5 billion in abalone alone. For 2008, this figure looks like it breached the R3 billion mark.

Fishing Permit Applications

If you are a quota holder in the South African fishing industry, then you are all too familiar with having to regularly use an array of consultants to attend to the completion of mundane yet crucial permit and licence applications. Feike has decided to offer South African quota holders a significant value proposition. Feike will attend to a quota holder’s –
  • permit applications;
  • licence applications;
  • vessel / effort change applications; and
  • section 21 right transfer applications,
for a monthly retainer fee of R500 plus VAT but inclusive of our renowned legal advice. For more information, please contact Feike’s Shaheen Moolla on smoolla@feike.co.za

Between 28 September and 2 October, Feike and the Indian Ocean Tuna Commission ran an African Union-World Bank funded training programme on the FINSS management software that Feike is distributing to fishing coastal states at no cost. FINSS is the acronym for the Fisheries Information and Statistical Systems software that allows users to effectively manage their entire fisheries licensing, administration, management and statistical components. Countries and organisations represented included Angola, Namibia, Mozambique, Tanzania and Kenya, as well as Seychelles and Madagascar. The South West Indian Ocean Fisheries Programme was also in attendance. The Benguela Current Commission was indirectly represented via the Namibian and Angolan representatives.

The attendees unanimously agreed to begin utilising the software and a user-report back session has been scheduled for April 2010. A second training session for west Africa has been provisionally scheduled for January 2010. FINSS is adaptable for use by commercial fishing companies interested in managing vessel deployments, harvesting, licensing and processing. the software is available at no charge and can be customised to suit individual user needs. The software is available in English, French and Portuguese and comes complete with comprehensive user and technical manuals.

In yet another damning admission, the South African government has admitted that it does not have the ability and resources to fight abalone poaching. It appears to be a deer looking at the headlights of a very large truck. The truth of the matter is that we had the resources, skills and institutions in place by 2004 to effectively reduce abalone poaching and they were working! But then came along Marthinus van Schalkwyk and his “new management team” who immediately went about dismantling everything that could be associated with the “previous management team”, including getting rid of as many staff as possible to ensure that the “transformation numbers” stacked up. In compliance alone, they removed two directors with more than 50 years of compliance experience. The one director, Marcel Kroese, is now a senior advisor to the US government’s fisheries surveillance programme! Kroese was the brainchild of the MARINES programme, the Green Courts and the sourcing of intelligence that brought down the Hout Bay Fishing Industries Patagonian Toothfish and lobster poaching syndicate, Elizabeth Marx and Jason Ross -the latter two being funders of abalone poaching syndicates who were jailed for more than 3 years each and were financially denuded by the Assets Forfeiture Unit.

So between 2005 and 2009, we have had a comprehensive enforcement vacuum coupled with the financial collapse at MCM which again was so effectively led by Monde Mayekiso for a second time in as many decades. So are we surprised by these latest admissions. Not surprised; maybe angry that we have allowed MCM to rob the Overberg of more than 1000 jobs and funded the spread of TIK use to thousands of poor Cape Town residents – not to mention the loss of more than 10 000 tons of abalone since 2005 worth some R5 billion.
But there is also hope now. The “New ANC” government appears to recognise the folly and failure of Van Schalkwyk’s Marine and Coastal Management. There now appears to be a sense of energy and urgency to get a handle on abalone poaching – the fact that the Police Commissioner himself is addressing the abalone poaching problem is a massive step in the right direction. I don’t believe that we lack the ability and resources to get on top of abalone poaching. What we need is a Minister that is prepared to lead and take some seriously tough decisions – we need Buyelwa Sonjica to pick up where Valli Moosa left off.
MCM cant deal with abalone poaching because of 3 basic reasons.
One, it does not have the money it had in 2004 because of incompetent and ineffective leadership. The MCM story today is similar to what Valli Moosa found in 1999. In 2004, Fisheries Compliance had a budget of more than R85 million – today this budget is understood to be less than R50 million. In addition, compliance had a team of extremely motivated and dedicated professionals who had access to resources (cell phones, overtime pay, vehicles, boats and a network of partners in nationally and internationally). MCM does not need more fishery control officers. It needs smarter leaders who can lead with an effective SMART compliance strategy. MCM’s funding crisis needs urgent attention and the only way to do this is to remove the senior management team at MCM and to seriously reduce the bloated administrative structure of more than 700 employees. With the right professional skills, MCM could operate effectively with less than 400 staff.
Two, MCM’s leaders have completely lost the trust and confidence of the abalone diving communities along the coast. In court papers in 2008, MCM’s senior management described all abalone divers as poachers! It is not only the divers that don’t trust MCM; a host of important partners no longer have faith in MCM. These relationships on the ground must be rebuilt.
Three, the compliance vacuum must be filled immediately. This particular wheel was invented back in 2003 and 2004. It needs rebuilding. The core components of the compliance should be to –
  • Get abalone divers back in the water fishing legally and for sustainable quotas, thus displacing a lot of illegal and unsustainable abalone and lobster poaching. A TAC of about 210 tons could be set for abalone fishing zones A, B, E, F and G. Zones C and D must remain closed.
  • Get the Green Courts up and running in Hermanus and Port Elizabeth. They will require properly trained “green” prosecutors supported by a team of properly trained fishery control officers. Magistrates will also require training in fisheries laws and sanctions.
  • Re-establish and staff the MARINES programme. This programme cost approximately R18 million in 2004 to implement.
  • Resolve MCM’s funding crisis so as to allow effective deployment of the patrol vessels. Part of MCM’s funding crisis is that it lacks the professional skills for effective use and deployment of the vessels. To use the Sarah Baartman and the inshore patrol vessels for anti-abalone poaching exercises is literally to throw money into the ocean.
  • Urgently attend to MCM’s gaffes internationally. The most important is the failure to implement CITES permit endorsement requirement which has made the trade in poached abalone extremely easy.
  • Get the right people with the right skills regardless of skin colour back to clean up the mess before it is too late.

If we implement this strategy, I believe we could seriously impact poaching numbers. We currently lose a conservatively estimated 10 million units of abalone each year worth some R1,5 to R2 billion annually. We need to reduce poaching to more ecologically sustainable levels which means getting annual figures down to about 500 000 units and less.

Director-General Forced to Admit Abalone Failure

Facing the Select Committee on Public Accounts, the Director-General of the department of water and environmental affairs, finally admitted that Marine and Coastal Management has failed to protect abalone from rampant poaching and does not have the resources to do so. It is incredible that it takes rampant failure and a huge loss to our ecology and socio-economy before such obvious admissions are made. Feike has been stating that MCM’s “compliance” strategies were not impacting on abalone poaching since at least 2006 and that South Africa was losing between 2000 and 3000 tons of abalone worth a conservative R2 billion annually to poaching.
Most recently, MCM’s Deputy Director-General, Monde Mayekiso, stated on the environmental conservation programme, 50/50, that he did not believe that poaching was a crisis and that MCM had matters under control. Earlier this year, Feike, together with the ISS, published a report that looked into poaching levels in South Africa. MCM attempted to reject the findings of the report by promising “facts” to be published by a “peer review panel”. More than 5 months have passed since MCM promised the publication of the peer review panel’s findings. To date, MCM refuses to even answer emails regarding this panel’s existence. MCM’s continued deception and denials of a crisis have finally been exposed. However, no one appears to be accountable yet again for the loss of billions of rands of abalone; the loss of more than a 1000 jobs due to the closure of fishery; the loss of millions of taxpayer rands caused by mismanagement and incompetence identified by the Auditor General.
What makes matters even worse at MCM is that not only does it rely on the sale of confiscated abalone for up to 30% of its operating budget, it’s a failing institution. It is currently unable to continue with research cruises (although it denies this – for now) because of a lack of funds, forcing its senior management to run around cap in hand begging for financial handouts. Its compliance budget is more than R40 million less than the budget in 2004. It is now trying to re-invent the wheel by reintroducing the green courts MCM disbanded in 2005 despite its undisputed successes against abalone poachers. MCM’s insistence on listing abalone on CITES backfired amid much international embarrassment after Feike revealed that it failed to endorse a single export permit which were then being traded by poachers to launder poached abalone back in South Africa.
In 1999, the current DDG, Monde Mayekiso, was removed from his post as head of MCM for, inter alia, “a lack of general management competence at the level of the Chief Director” and specifically that Monde Mayekiso “… was not in control of activities in MCM, and that he was out of his depth as a manager. He exhibited a basic lack of insight of the enormity of the problem. The Committee (led by the previous DG of Environmental Affairs and Tourism, Dr Crispian Olver) believes that Dr Mayekiso is not suitable for the position he holds.” Will political expediency continue to overrule this country’s desperate and urgent need to rid itself of the current excess of incompetence and failure at MCM?
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