Does new fund for the seafood industry go far enough?

It says the fund will provide “much needed relief for the local processing sector throughout our islands”, but workers within the industry are concerned it doesn’t go far enough.

The £10 million Scottish Seafood Business Resilience Fund is aimed at providing assistance for processing businesses during Covid-19 pressures and said that there were ‘many seafood businesses fighting for survival’, and in turn threatening livelihoods in coastal communities.

The Government confirmed the fund would provide a combination of grants and loans to businesses suffering severe hardship following the shutdown of international markets and the food service industry across the UK, up to a level of €120,000 – the maximum amount allowed under state-aid rules – with further details of the fund yet to be announced.

A spokesperson for Comhairle nan Eilean Siar said: “The Comhairle welcomes the announcement from Scottish Government regarding the Scottish Seafood Business Resilience Fund which will provide much needed relief for the local processing sector throughout our islands. We await further details on support for fishing vessels, many of which supply processors directly.

“The Comhairle has paid out nearly £1.5m in grants to businesses under the Coronavirus Business Support Fund (Grants) and we are also reminding businesses to Contact Business Gateway.”

However, for at least one local seafood processing business, concerns remain that the funding might take too long to come through, and that a lack of funding support for fishing boats over 12ms in length remains a significant issue.

Hector Stewart, a director of Kallin Shellfish based in Grimsay, North Uist, confirmed that 25 staff had been furloughed by the company and that its boats were now tied up and not going to sea.

He said business was at “a dead stop” and that only one member of staff had been kept working to run the company’s office and work related to the small shop on site.

When asked if he thought the new funding would support the industry, Mr Stewart said: “Well, there has been a lot of talk and quick announcements, and it has been quick and that’s not an easy thing to do, but it has been a little bit slow in terms of getting the funding in place.

“There was quick funding for small, under 12m boats announced by the Government, and I think that is going to come out to them in a few days, because we’ve helped one or two of them with it, so I think they are going to get that, but there has been nothing for the over 12m vessels which all our boats are.”

Kallin Seafords currently buys its stock from four scallop boats, three the company has a share in or owns and from another they buy 100 per-cent of its catch.

The company also buys from 10-20 local creel boats, with scallops being “the bread and butter” of the industry, Mr Stewart stated, “that keeps the factory going”.

“The banks have told us”, Mr Stewart confirmed, “that they will give us a holiday on the payments on the boats, but insurance on the boats is about £1500 per month and nothing has happened on that, so any reserves will drain fairly quickly.

“We have boats and we have a factory and the people who have a shareholding in the boats also have a share in the factory.

“Now, the boats have stopped going to sea, and the last time they were at sea their catch was sold at less than they were paid for it because the situation was changing every hour and in the end we just had to off-load it.

“The furlough was the big one for us in terms of the staffing here, at 80 per-cent [of wages] that’s quite good but we are not interested in loans from banks – who is going to take out a loan with any certainty just now?”

“Can we ever get back to where we were?” Mr Stewart concluded, “and I just worry that we can’t. I just don’t know if the markets will open again into the continent or even into the UK, our main market, our main sale was scallops to the UK.

“Then all the restaurants closed and everything stopped going out, and with the distancing and everything, they had started closing before we finished. In the end we couldn’t sell what we had. The boats had to stop going out.”

A Scottish Government spokesperson said: “The Scottish Government is going to great lengths to support businesses and has offered a package of support worth £2.2 billion for businesses.

“We would encourage businesses to make the most of all the supports on offer to them, including the coronavirus job retention scheme which provides the certainty that many businesses need to continue to pay people’s wages.

“Work on the grant to processors is ongoing and we hope to open applications soon. The available support for operators of fishing vessels greater than 12 metres in length is under constant review, and we are in regular contact with industry on this.

“We continue to explore how best to support businesses during this unprecedented economic challenge and recently launched a helpline to provide businesses across Scotland with advice and guidance on Covid-19.”

Peter Urpeth - Local Democracy Reporting Service

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