Business Opinion/John McManus: There are two fishing boats tied up in Killybegs at the moment. The Neptune and the Áine are state-of-the-art deep sea trawlers worth €12 million each.
According to their owners, because they cannot go fishing the jobs of 25 people who work on them are at risk, which means the €600,000 a year that their wages are worth to the local economy is also under threat. So is the €1.25 million a year in wages paid to the 70 people who work in the factory in nearby Burtonport who process the fish that the boats catch.
The indirect cost to the local economy in terms of the shops, net companies, diesel suppliers and others who do business with the boats is not so easily quantifiable, but is undoubtedly significant.
It seems a pretty crazy state of affairs, and the more you look into the legal and technical quagmire of tonnage, fishing licences, risk-taking and EU legislation that forms the background to this situation, the more crazy it becomes.
The story goes back to the mid-1990s when the Killybegs- based mackerel or pelagic fishing industry was thriving. In order to capitalise on the lucrative market, owners began to upgrade or replace their boats. Because the total tonnage of the Irish fishing fleet is strictly controlled, the owners had to either buy existing tonnage from other owners or be given new tonnage by the Government.
The owners of six boats, including Mr Joseph Doherty and Ms Eileen Oglesby - owners of the Áine and the Neptune respectively - planned to avail of a scheme whereby they could increase the size of their boats as long as the extra tonnage was for safety purposes. They also planned to buy additional tonnage on the market.
But last year the European Commission ruled that the Irish boats did not qualify under the safety tonnage scheme. This left the owners with little option but to buy all their tonnage on the market because without the tonnage they cannot be licensed and thus cannot fish in European waters.
Under the terms of a solution brokered by the Department of Communications, Marine and Natural Resources last year, they were told they could buy their "safety tonnage" from the non-pelagic segment of the fleet, but the balance had to be "pelagic" tonnage - from other mackerel boats.
Last week saw the six owners - under the umbrella of the Killybegs Fishermen's Organisation - in the Commercial Court seeking an injunction pending a judicial review of this policy. They argue that they should not be made buy the "safety tonnage" until the outcome of appeals against the Commission's original decisions not to grant it are heard.
In addition they claim the Department of Communications, Marine and Natural Resources is taking advantage of their predicament to sort out another problem - surplus tonnage in the non-pelagic sector.
The case was adjourned to March at the Department's request, by which time the best of the mackerel season will be over. As a consequence the owners seem to be faced with little choice if they want to go fishing other than to go back to their banks and try and raise the finance for the safety tonnage.
Some of them will find it easier than others. The widely held perception is that the owners of the big mackerel boats are all millionaires at this stage and really don't deserve any sympathy. This smacks of the sort of begrudgery that pretty much anyone who has made significant amounts of money in Ireland must deal with at some stage.
A more balanced perspective is that the owners took an informed risk - with the backing of Government - when they built the boats without first having their safety tonnage and additional tonnage sorted out. Things did not work out as planned and they must now deal with the consequences. They have no more and no less right to help from the State than any other businessman or woman.
It is interesting in this context to look at the incredible lengths gone to by the State to help out one Killybegs fisherman, Mr Kevin McHugh. He also built a new boat in the 1990s.
At 14,000 tonnes the €50 million Atlantic Dawn is one of the biggest fishing boats in the world. Mr McHugh also took a risk that the European Commission would play ball with him, and allow the new boat into the Irish fleet without making him buy 14,000 tonnes of tonnage first.
When the Commission refused to allow the new ship onto the Irish register, all the stops were pulled out by the State, right up to the involvement of the Taoiseach, Mr Ahern, to find a solution. Ultimately one was arrived at last year that allowed the Atlantic Dawn into the Irish fleet. In exchange Mr McHugh had to take his other boat, the Veronica, off the Irish register. But as part of the deal Mr McHugh was allowed to keep her "pelagic tonnage" to sell if he wished.
This was a real bonus, as there was a ready market for the Veronica's tonnage in the shape of the other owners who still needed to make up the difference between the tonnage of their new boats and the tonnage of their old boats plus the safety tonnage they hoped to get.
Mr McHugh was happy to sell the competitors the Veronica's tonnage but at something like twice the price they had expected, making €40 million in the process. His competitors had little choice other than to deal with Mr McHugh, as there was no other tonnage for sale. Without a doubt it hurt them financially, putting pressure on already stressed finances in some cases.
By allowing Mr McHugh to keep the Veronica's tonnage, the State afforded him what was a remarkable business opportunity when you bear in mind he was also allowed bring a 14,000-tonne boat into the Irish fleet.
Quite why Mr McHugh was put in, or allowed get himself into such an advantageous position is unclear. Several people know the answer. One of them is the Taoiseach.
jmcmanus@irish-times.ie
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