Scottish Offshore Marine Protected Areas (MPAs) - fisheries management measures: final business regulatory impact assessment

Section 3: Costs, impacts and benefits

Approach to assessing costs and benefits

This section summarises the methodological approach taken to estimate the benefits and costs of the policy options presented in this BRIA. A more detailed methodology is available in Annex A.

Impacts to commercial fisheries and fisheries processors

Impacts to commercial fisheries have been estimated in terms of value of landings, gross value added (GVA) and full-time equivalent (FTE) employment. Impacts for both options are presented as a range to reflect the potential for the displacement of fishing activity to compensate for loss of landings from MPA sites. Displacement has been assessed using a displacement test (see Annex A. for more detail).

Knock-on impacts to commercial fisheries supply chain (e.g. fish processors) have been assessed by estimating indirect GVA impacts, using multipliers from the Scottish Government's Supply, Use and Input-Output Tables.

Public sector costs

Public sector costs were estimated for the following broad areas based on discussions with information provided by Scottish Government Marine Compliance:

• Mechanisms to implement restrictions on fishing activity in offshore sites;
• Monitoring and control of fishing activity.

Impacts to Ecosystem Services

The term ‘ecosystem services’ relates to the direct and indirect contributions that ecosystems provide to society.

Due to data constraints and scientific uncertainty, it is challenging to monetise the expected change in ecosystem services. Instead, a qualitative assessment has been undertaken.

The analysis of changes to ecosystem services has considered both on-site and off-site impacts of management options. Off-site impacts could be positive (e.g. by supporting healthier fish stocks in the area) or negative (e.g. due to the impacts of displaced fishing vessels). On-site costs could arise as a result of alternative fishing gears (e.g. creels, nets and lines) being deployed in MPAs where management measures have excluded mobile demersal gears. An overall level of impact for each site has been defined alongside a confidence level.

Limitations and Uncertainties

All of the estimates of costs and benefits assessed within the SEIA are subject to significant uncertainties. Uncertainties around economic estimates arise from the assumptions on the level of displacement of fishing activity as it is not possible to establish the true levels. For example, for the higher end of the range for figures presented for each option, it is assumed that the entire value of landings affected would be lost, however in practice a level of displacement of activity is likely to occur which would mitigate that.

As the value of future landings cannot be forecast, it is assumed that the value of landings are constant over time for the analysis. The average value of landings per year estimated for each site is therefore assumed to be the same in each of the 20 years covered by the quantification of impacts. In reality, it is likely that the value of landings in each site would fluctuate over time, and hence the estimated loss in landings may underestimate or overestimate the true future value of landings. As the GVA and employment estimates are based on the value of affected landings, the same limitation applies.

Other non-quantifiable impacts

In addition to impacts to landings, GVA and employment, there are additional potential impacts that have not been quantified in the assessment but have been considered.

The implementation of management measures restricting certain gear types from operating in the sites (or parts of the sites) may result in the displacement of fishing effort from the sites. Immediate impacts may include affected vessels being required to steam further to reach fishing grounds, fish on less productive grounds or required to fish more to maintain catches. This may result in potential changes to vessel cost and revenue profiles.

It is also possible that the management measures help populations of particular species (including commercial fish or shellfish species, and other protected biodiversity) inside the site which in turn support a larger overall population and therefore increased abundance outside the site. There is evidence that fishers catch near a MPA can be larger than in other areas ^{[6] [7]} which will benefit commercial fishers utilising areas around the protected areas. However, to increase the robustness of the estimates calculated, this has not been accounted for in the benefits or costs of the MPAs.

Benefits to business

This section assesses the estimated benefits of each policy option. The benefits that are expected to arise under option 1 and 2 are primarily in the form of ecosystem service benefits. The term ‘ecosystem services’ relates to the direct and indirect contributions that ecosystems provide to society. The concept of ‘ecosystem services’ is used to capture the benefits provided. Ecosystem services are the outcomes from ecosystems that directly lead to goods and services that are valued by people^[8] and the benefits and the beneficiaries are not uniform and cover a wide range of ecosystem functions and interdependencies. The offshore marine environment is known to support vitally important ecosystem services^[9].

The majority of benefits to arise from implementing fisheries management measures can be classed under ecosystem services. Although it has not been possible to monetise the expected ecosystem service benefits arising from this option, there are a number of relevant studies that have assessed the extent to which people value the protection of species in offshore waters. Previous work^[10] linked the features in the proposed Scottish MPAs to different ecosystem services to provide a guide to the levels of ecosystem services that may be provided by the sites.

An international study by Brander et al^[11] concluded that the benefits to people of expanding environmental protection from MPAs generally outweighed the costs. Another study by McVittie and Moran^[12] derived a primary estimate of benefits from the implementation of the nature conservation measures in the draft Marine Bill (specifically Marine Conservation Zones). They identified UK households’ aggregate willingness to pay in the range of £487-£698 million per year (high proportion of this value could be non-use value). Börger et al. 2014^[13] found that people held significant values for the protection of species in an offshore MPA in English waters.

Non-use cultural value relates to values people have for knowing that the marine environment is being protected, even though they never directly plan to make use of it. They may be motivated by altruism, bequest and existence value motivations, but the exact drivers of individual’s values can be hard to distinguish from the values they may hold for other marine ecosystem services. Though there is uncertainty associated with the quantification of ecosystem services, evidence does suggest that members of the public are likely to hold non-use values for deep sea protection, associated with protection of vulnerable species and habitats^[14].

Longer term benefits may be recognised by the fishing industry where maintaining healthy populations of particular species (including commercial fish or shellfish species, and other protected biodiversity) inside the site supports a larger overall population and therefore increased abundance outside the site. There is evidence that fishers catch near a MPA can be larger than in other areas ^{[15] [16]} which will benefit commercial fishers utilising areas around the protected areas. The extent and time scale of this effect depends, amongst other things, on the size of site, impact of management options and mobility and lifecycles of the species concerned.

For research and education, the ecosystem service benefit from management options is higher when a larger area and number of features are protected, and when the state of features at a site is known. It is important to note that for many features the extent and / or condition are uncertain, which makes it harder to assess potential benefit, and results in some sites having lower research and education value, as less can be learnt on features response to management if their pre-management state is unknown.

Marine tourism and recreation impacts can be very significant, but are predominantly concentrated around inshore areas. These services are not assessed for individual offshore sites. However, by improving the health of Scotland’s seas, the management options could increase the abundance of distinctive mobile fauna (e.g. seabirds, cetaceans) which use offshore and inshore areas. These species can attract significant recreation and tourism activity. Therefore, the management options could collectively contribute to enhancing this service. This is supported by a study by the European Commission looking at the economic benefits of MPAs, which found that MPAs deliver concrete benefits for the tourism industry in a number of case studies due to the additional environmental protection^[17].

For genetic resources, these are poorly measured for marine ecosystems, but are relevant - for example, Potts et al.^[18] identified medicines and blue biotechnology as an important marine service. Their future value cannot be quantified, but preserving them in Scottish waters is positively valued (Jobstvogt et al. ^[19]). There is potentially a significant option value to preserving the genetic resources in offshore habitats, including where the extent and condition of habitats and species are poorly understood.

In general, there is moderate uncertainty on the extent of ecosystem service impacts, although this varies across services. The management options would provide protection to a wide range of seabed features from fishing gear identified as damaging, and therefore protect and enhance their role in food webs. This could result in improved ecosystem health, and provide benefits by supporting commercial fish stocks, carbon storage in seabed sediments (although this is highly uncertain) and through the cultural value to people in Scotland of managing a healthy marine environment. There is high uncertainty in the monetary valuation of these benefits, and robust values are not available to support cost-benefit analysis.

Option 1 Benefits: Implement zonal based fisheries management measures under the Marine and Coastal Access Act 2009

Option 1 represents fisheries management measures that have been developed with the fishing industry and Environmental Non-Governmental Organisations (eNGOs).

These measures have been developed with a focus on protecting features to enable conservation objectives to be met whilst allowing sustainable fishing activity and practices to continue alongside. Under this option, measures may or may not be implemented across the full site.

Table 4 presents a summary of the assessment of ecosystem service benefits under Option 1 detailing the level of anticipated benefit, and the level of confidence in the estimation for each site based on the current available evidence. The classifications for level of benefit were nil, minimal, low, moderate, high (detailed in Table A1). Further information on how the level of benefit has been estimated is available in Annex A.

Under this option, all sites were identified as having beneficial impact on non-use cultural value, with one site classified as having nil-low impact, eight sites having a low impact, and eleven having a low – moderate impact. Fifteen sites were identified as having a beneficial impact on fish stock recovery, one classified as having minimal impact, one having as nil – low impact, five having a low impact, and eight having a low – moderate impact.

For fifteen of the twenty-one sites there is ‘low’ confidence in the evidence used to draw the relevant conclusions. For the remaining six sites the confidence was ‘moderate’.

Table 4. Summary of Expected Ecosystem Services Benefits arising from Option 1 (over 20 years).

Site

Anton Dohrn Seamount

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

Braemar Pockmarks

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

Central Fladen

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Darwin Mounds

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

East of Gannet and Montrose Fields

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

East Rockall Bank

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

Faroe-Shetland Sponge Belt

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, research, and non-use cultural value.
• Confidence: Low

Firth of Forth Banks Complex

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use value.
• Confidence: Low

Geikie Slide and Hebridean Slope

• Level of benefit: Low
• Anticipated ecosystem service: Research and non-use cultural value
• Confidence: Low

North-East Faroe-Shetland Channel

• Level of benefit: Low
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

North West Rockall Bank

• Level of benefit: Low - Moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Norwegian Boundary Sediment Plain

• Level of benefit: Low
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

Pobie Bank Reef

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Scanner Pockmark

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Moderate

Solan Bank Reef

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Stanton Banks

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

The Barra Fan and Hebrides Terrace Seamount

• Level of benefit: Low - Moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Turbot Bank

• Level of benefit: Nil - low
• Anticipated ecosystem service: Fish stock recovery, research, and non-use cultural value
• Confidence: Moderate

West of Scotland

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

West Shetland Shelf

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Wyville-Thomson Ridge

• Level of benefit: Minimal
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

Option 2 Benefits: Prohibit damaging gears from the full site under the Marine and Coastal Access Act 2009

Implementation of fisheries management measures under a full site restriction would also support the achievement of site conservation objectives. Gears identified as damaging to the relevant protected features would not be permitted within the site. It is expected that the benefits realised under Option 1 would be realised under this option but to a higher degree. The level of this cannot be quantified using current evidence.

Table 5 presents a summary of the assessment of ecosystem service benefits under Option 2 detailing the level of anticipated benefit and the level of confidence in the estimation for each site based on the current available evidence. The evidence used to assess the level of anticipated benefit for fifteen of the twenty-one sites was categorized as having a low confidence rating. For the remaining six sites, there is moderate confidence in the evidence used to draw the relevant conclusions. This remains the same as the level of confidence assessed in option 1.

In regards to level of benefit, eighteen of the twenty-one sites presented the same results as Option 1. Geikie Slide and Hebridean Slope is estimated to have a low- moderate level of impact for research and non-use culture values, in comparison to low impact for the same criteria under option 1. Turbot Bank is estimated to have a low level of impact for fisheries, cultural and research values, in comparison to a nil – low impact for the same criteria under option 1. Wyville-Thompson Ridge was assessed to have a low-moderate impact for fish stock recovery and non-use cultural values, in comparison to minimal impact under option 1. Further information on how level of benefit has been estimated is available in Table A1.

Table 5. Summary of Expected Ecosystem Services Benefits arising from Option 2 (over 20 years).

Site

Anton Dohrn Seamount

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

Braemar Pockmarks

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

Central Fladen

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Darwin Mounds

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

East of Gannet and Montrose Fields

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

East Rockall Bank

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

Faroe-Shetland Sponge Belt

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, research, and non-use cultural value.
• Confidence: Low

Firth of Forth Banks Complex

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use value.
• Confidence: Low

Geikie Slide and Hebridean Slope

• Level of benefit: Low – moderate
• Anticipated ecosystem service: Research and non-use cultural value
• Confidence: Low

North-East Faroe-Shetland Channel

• Level of benefit: Low
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

North West Rockall Bank

• Level of benefit: Low - Moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Norwegian Boundary Sediment Plain

• Level of benefit: Low
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Low

Pobie Bank Reef

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Scanner Pockmark

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Non-use cultural value
• Confidence: Moderate

Solan Bank Reef

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Stanton Banks

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

The Barra Fan and Hebrides Terrace Seamount

• Level of benefit: Low - Moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

Turbot Bank

• Level of benefit: Low
• Anticipated ecosystem service: Fish stock recovery, research, and non-use cultural value
• Confidence: Moderate

West of Scotland

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Low

West Shetland Shelf

• Level of benefit: Low - moderate
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Wyville-Thomson Ridge

• Level of benefit: Low - Moderate
• Anticipated ecosystem service: Fish stock recovery and non-use cultural value
• Confidence: Moderate

Option 3 Benefits: Do nothing

No additional benefits are expected to arise from this policy option.

Quantified costs to businesses

This section estimates the costs for each policy option. Costs have been estimated in terms of ecosystem service costs, impacts to commercial fisheries, public sector costs and other non-quantifiable costs . Due to the variability in this, values presented are an estimate based on best available data, and it is acknowledged that impacts will likely fall between the figures given for the two impact levels.

The commercial fishing industry will be directly impacted, and associated costs may arise through employment levels, loss of landings or costs associated with displaced activity. There are further non-quantified impacts which may occur where affected vessels may have to steam further to reach fishing grounds, and may be fishing on less productive grounds, having to fish more to maintain catches. These may result in potential changes to vessels cost and revenue profiles.

Option 1 Costs: Implement zonal fisheries management measures under the Marine and Coastal Access Act 2009

Ecosystem service costs may arise from displacement of fishing effort (off-site), the intensification of activities in areas where they already occur and use of alternative fishing gears (on-site). In general, the potential ecosystem services costs from this option is judged to be nil - low. A summary of the estimated ecosystem services costs in provided in Table 6. The classifications for level of cost were nil, minimal, low, moderate, high. Further information on how level of benefit has been estimated is available in Table A1.

Table 6. Summary of expected ecosystem services costs arising from Option 1 (over 20 years)

Site

Anton Dohrn Seamount

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Braemar Pockmarks

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Central Fladen

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Darwin Mounds

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

East of Gannet and Montrose Fields

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

East Rockall Bank

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Faroe-Shetland Sponge Belt

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Firth of Forth Banks Complex

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Geikie Slide and Hebridean Slope

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

North-East Faroe-Shetland Channel

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

North West Rockall Bank

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Norwegian Boundary Sediment Plain

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Pobie Bank Reef

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Scanner Pockmark

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Solan Bank Reef

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Stanton Banks

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

The Barra Fan and Hebrides Terrace Seamount

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Turbot Bank

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

West of Scotland

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

West Shetland Shelf

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Wyville-Thomson Ridge

• Estimated level of cost: Minimal -Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Eight of the twenty-one sites are estimated to have no costs to ecosystem services, five sites are categorised with minimal-low costs, and eight sites at low cost.

In addition to ecosystem service costs, direct financial costs may be incurred through GVA impact, FTE employment or a loss in value of landings. These estimates are summarised in Table 7. The ranges presented within the table represent the capacity for fishing activity to be displaced with the lower value in the range representing the impact when fishing activity can take place in other areas, and the upper end representing all fishing activity being lost. Further information is provided in Annex A.

Table 7. Estimated economic impacts for each site over 20 year assessment period (2023-2042). The reduction in GVA is in present value (PV) terms, with costs discounted over the full assessment period in 2022 prices).

Site	Direct + indirect GVA impact (PV) (£000s)	Direct + indirect reduction in FTE employment	Annual average loss in value on landings (£000s)
Anton Dohrn Seamount	0 – N/D	0 – N/D.	N/D.
Braemar Pockmarks SAC	0.0 - 34.2	0.0 - 0.1	0.0 - 4.3
Central Fladen MPA	1,007.8 - 4,118.1	1.3 - 6.2	103.7 - 493.2
Darwin Mounds	0	0	0
East of Gannet and Montrose Field MPA	0.0 - 90.1	0.0 - 0.1	0.0 - 11.3
East Rockall Bank	0 - 415.0	0 - 0.6	0 - 49
Faroe-Shetland Sponge Belt MPA	0.0 - 969.6	0.0 - 1.5	0.0 - 119.6
Firth of Forth Banks Complex MPA	0.0 - 1,644.4	0.0 - 2.4	0.0 - 194.3
Geikie Slide and Hebridean Slope	0 - 640.5	0 - 1.0	0 - 77
North-East Faroe-Shetland Channel MPA	0.0 - 104.9	0.0 - 0.2	0.0 - 13.1
North West Rockall Bank	0 - 2,606.0	0 - 3.9	0 - 308
Norwegian Boundary Sediment Plain MPA	0.0 - 307.9	0.0 - 0.5	0.0 - 38.2
Pobie Bank Reef SAC	0.0 - 3,441.7	0.0 - 5.4	0.0 - 425.7
Scanner Pockmark SAC	0.0 - 31.7	0.0	0.0 - 4.0
Solan Bank Reef	4,636.7 - 4,830.5	7 - 7.3	555 - 577
Stanton Banks	0 - 12.3	0	0 - 1
The Barra Fan and Hebrides Terrace Seamount	0 - 143.0	0 – 0.2	0 – 17
Turbot Bank MPA	0.0	0.0	0.0
West of Scotland	789.3 - 2,021.7	1.1 - 2.9	85 - 233
West Shetland Shelf	0 - 1,012.6	0 - 1.5	0 - 121
Wyville Thompson Ridge	0 - 25.3	0 - 0	0 – 3
All sites	6433.8– 22449.6	9.4– 33.9	744–2,689
Direct and indirect reduction in employment = The average (mean) reduction in FTE employment in the sector and the sector’s suppliers as a result of reduced expenditure by employees and suppliers. N/D. = Value cannot be disclosed. Where no range is reported, this is because the affected fishing activity cannot be displaced to surrounding areas. Figures may not sum due to rounding.

Under Option 1, the quantified estimates for economic impacts would:

• Reduce the average annual average loss in value of landings by the UK commercial fisheries sector by between £0.7–2.7 million;
• Reduce GVA (direct + indirect) of the UK commercial fisheries sector over the assessment period by £6.5–22.4 million (present value); and
• Reduce the average (mean) number of jobs (direct and indirect) by between 9 and 34 FTEs.

Option 1 is expected to have minimal impacts on fisheries at the lower end of the estimate. This is as the fishing activity affected by the measures is expected to be able to be displaced and take place within the surrounding area (in most cases, the ICES rectangles within which the sites are located), without significant socio-economic consequences. The loss in value of landings is expected to be nil for 17 out of the 21 sites under this option. The three sites with an estimated impact under this option are Central Fladen MPA with an estimated loss of £104,000, Solan Bank Reef with an estimated loss of £555,000, and West of Scotland with an estimate loss of £85,000, all in present value terms over 20 years. The loss in value of landings under this estimate, across all sites, would represent 0.12% of the gross value on landings by Scottish vessels in 2019^[20].

The impacts are expected to be more significant under the higher end of this estimate (where all affected landings are assumed to be lost), which is equal to 0.46% of the gross value of landings by Scottish vessels (£582 million) in 2019^[21].

Total employment on Scottish fishing vessels was 4,886 in 2019. The SEIA estimates that Option 1 has the potential to put between 9 and 34 FTE employment roles at risk in the commercial fishing sector and its supply chain.

Option 2 Costs: Prohibit damaging gears from the full site under the Marine and Coastal Access Act 2009

Ecosystem service costs may arise from displacement of fishing effort (off-site) or the intensification of activities in areas where they already occur and use of alternative fishing gears (on-site). The potential ecosystem services costs under Option 2 are judged to be nil or minimal - low. Under Option 2 the level of displacement has potential to be higher in comparison to Option 1 due to the greater spatial restrictions on fishing activity within protected areas. This is summarised in Table 8. Further information on how level of benefit has been estimated is available in Table A1.

Site

Anton Dohrn Seamount

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Braemar Pockmarks

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Central Fladen

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Darwin Mounds

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

East of Gannet and Montrose Fields

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

East Rockall Bank

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Faroe-Shetland Sponge Belt

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Firth of Forth Banks Complex

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Geikie Slide and Hebridean Slope

• Estimated level of cost: Minimal - low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

North-East Faroe-Shetland Channel

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

North West Rockall Bank

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Norwegian Boundary Sediment Plain

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Pobie Bank Reef

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Scanner Pockmark

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

Solan Bank Reef

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Stanton Banks

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

The Barra Fan and Hebrides Terrace Seamount

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Turbot Bank

• Estimated level of cost: Nil
• Anticipated ecosystem service: No ecosystem service costs will arise.
• Confidence: Moderate

West of Scotland

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

West Shetland Shelf

• Estimated level of cost: Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Wyville-Thomson Ridge

• Estimated level of cost: Minimal -Low
• Anticipated ecosystem service: Fish stock recovery, climate regulation and non-use cultural value
• Confidence: Low

Eight of the twenty-one sites are estimated to have no costs to ecosystem services, five sites are categorised with minimal-low costs, and eight sites at low cost. Confidence levels in the assessment also remains the same as under Option 1.

In addition to ecosystem service costs direct financial costs may be incurred through GVA impact, employment or a loss in value of landings. These estimates are summarised in Table 9. The ranges presented represent the capacity for fishing activity to be displaced.

Table 9. Estimated economic impacts for each site over 20 year assessment (2023-2042) period under Option 2. The reduction in GVA is in present value (PV) terms with costs discounted over the full assessment period in 2022 prices.

Site	Direct + indirect GVA (PV) (£000s)	Direct + indirect reduction in employment (FTE)	Annual average loss in value on landings (£000s)
Anton Dohrn Seamount SAC	0 – N/D	N/D	N/D
Braemar Pockmarks SAC	0.0 - 34.2	0 - 0.1	0 - 4.3
Central Fladen MPA	21,153.4 – 21,153.4	33.0	2,620.3
Darwin Mounds SAC	0	0-0	0
East of Gannet and Montrose Field MPA	0 – 2,460.4	0 - 3.9	0 - 308.1
East Rockall Bank SAC	1,943.4 - 3,301.9	2.6 - 4.7	209.0 – 372.0
Faroe-Shetland Sponge Belt MPA	0 - 4,536.9	0 - 7.1	0 - 566.3
Firth of Forth Banks Complex MPA	7,902.0 – 9,093.8	11.7 - 13.6	932.0 - 1,080.3
Geikie Slide and Hebridean Slope MPA	2,842.8	4.3	341.0
North-East Faroe-Shetland Channel MPA	0 - 282.1	0 - 0.4	0 - 35.3
Northwest Rockall Bank SAC	0 - 2,606.0	0 - 3.9	0 - 308.0
Norwegian Boundary Sediment Plain MPA	0 - 379.5	0 - 0.6	0 – 45.5
Pobie Bank Reef SAC	0 - 4,891.3	0 - 7.6	0 - 606.1
Scanner Pockmark SAC	0 - 31.7	0.0	0 - 4.0
Solan Bank Reef SAC	5,331.1 - 5,525.7	8.0 - 8.3	639.0 – 660.0
Stanton Banks SAC	0 - 45.3	0 - 0.1	0-5
The Barra Fan and Hebrides Terrace Seamount MPA	0 - 330.4	0-0.5	0-40
Turbot Bank MPA	0.0	0.0	0.0
West of Scotland MPA	789.3 - 2,021.7	1.1 - 2.9	85.0 - 233.0
West Shetland Shelf MPA	0 - 5,155.5	0 - 7.8	0 – 617.0
Wyville-Thomson Ridge SAC	0 - 1,278.0	0 - 2.2	0 - 178.0
All sites	39962– 65970.6	60.8–101.1	4,826–8,022
Direct and indirect reduction in employment = The average (mean) reduction in employment in the sector and the sector’s suppliers as a result of reduced expenditure by employees and suppliers. Where no range is reported, this is because the affected fishing activity cannot be displaced to surrounding areas. Figures may not sum due to rounding.

Under Option 2 management measures the quantified impact estimates are that the measures would:

• Reduce the average annual value of output landed by the UK commercial fisheries sector by between £4.8–8.0 million;
• Reduce the present value GVA (direct and indirect) over the assessment period by £40–66 million (present value); and
• Reduce the average employment (mean number of jobs, direct and indirect) of the UK commercial fisheries sector by between 61 and 101 full time equivalents (FTEs).

In 2019 the fishing industry generated £329 million GVA, accounting for 0.22% of the overall Scottish economy and 6.5% of the marine economy GVA^[22]. The upper estimate for Option 2 would present the highest estimated cost to fisheries with an estimated £8 million of lost landings, and £66 million of lost gross value added (GVA) over 20 years.

Under Option 2 at the lower end of the estimate the annual average loss in value of landings is expected to be nil for 15 of the 21 sites. This is as the fishing activity affected by the measures is expected to be able to be displaced and take place within the surrounding area (in most cases, the ICES rectangles within which the sites are located), without significant socio-economic consequences. The total estimated loss in landings from the lower range of this option would represent 0.83% of the gross value of landings by Scottish Vessels in 2019.

The total impacts on loss of landings across all sites are expected to be more significant where all affected landings are assumed to be lost and the highest estimate represents 1.38% of the gross value of landings by Scottish vessels (£582 million in 2019^[23]).

Total employment (headcount) in the sea-fishing industry was 4,886 in 2019, which is 0.2% of the labour force in Scotland^[24]. The SEIA estimates that Option 2 has the potential to put between 61 and 101 full time employment roles at risk in the commercial fishing sector and its supply chain year on year, representing 1.2 – 2.1% of the sea-fishing industry.

Option 3: Do nothing

In the absence of the proposed measures a significant amount of Scotland’s offshore marine species and habitats are at risk to potentially damaging fishing activity, existing fisheries measures excepted. Under this option, environmental damage may occur, and therefore site conservation objectives would not be achieved. Scottish Ministers have a legal requirement to put in place fisheries management measures as soon as possible for existing MPAs where these are not already in place to achieve the conservation objectives for the protected features. Therefore this option is not viable.

Cost summary tables

Table 10 outlines the overall estimated costs for each option detailing the GVA impact, loss in value of landings, public sector costs and impacts on employment, as discussed under each option above.

A full breakdown of costs per site is available in Table B1.

Table 10. Cost summary tables for Option 1 and Option 2.

Scenario	Option 1 – Zonal management of damaging gears	Option 2- Site closure to damaging gears
Direct + indirect GVA impact (£000s) (PV)	6433.8 – 22449.6	39962 – 65970.6
Annual average loss in value on landings (£000s)	744 – 2,689	4,826 – 8,022
Public Sector costs (£000s)	9,727.9	3,231.8
Direct + indirect reduction in employment (FTE)	9.4 – 33.9	60.8 – 101.1

Public sector costs

Option 1 would result in additional costs incurred by the public sector for compliance and enforcement. An estimate for the annual costs associated with compliance and enforcement for the proposed measures has been informed by Scottish Government Marine Compliance.

Table 11. Present value of public sector costs for Option 1 (2022 prices, over 20 years) (£000).

Activity	Lower estimate
Increased VMS polling rate	76.8
Increased resources at UKFMC	9,651.1
Total	9,727.9

Option 2 would result in additional costs incurred by the public sector for compliance and enforcement. An estimate for the annual costs associated with compliance and enforcement has been informed by Marine Directorate.

Table 12. Present value of public sector costs for Option 2 (2022 prices, over 20 years) (£000).

Activity	Estimated costs
Increased VMS polling rate	29.7
Increased resources at UKFMC	3,202.1
Total	3,231.8

Scottish firms’ international competitiveness

The sector most likely to be directly impacted by proposed measures is the commercial fishing industry. Measures were developed with stakeholders in 2013-2017 which included fishing industry representatives to take into consideration potential impacts on fishers. Further meetings were held with industry individuals and representatives in 2021 and 2022 where each site and the proposed measures were shared and discussed. In some cases, boundary adjustments were taken into account to facilitate site use if it would not impact the achievement of conservation objectives.

It is anticipated that fisheries displacement will mitigate some of the expected impacts of reduction in landings. The anticipated environmental protection will also provide benefits to fish stock recovery (discussed in benefits), which will support fisheries in the longer term. The management measures are not expected to affect Scottish businesses ability to compete internationally.

Small business impacts

The introduction of fisheries management measures may lead to competitive disadvantage for commercial fisheries actively operating within a given spatial area, potentially restricting the output capacity of the sector. However, given that as an activity is likely to be displaced instead of lost, these impacts are negligible. It is not expected that the distribution of additional costs will be skewed towards smaller entrants relative to larger existing suppliers.

Investment

The proposed policy is not expected to have any impact on making Scotland a more, or less, attractive place for global investment.

Competition Assessment

In addition to looking at the impact on individual firms, it is important to consider the impact that a regulation or policy might have on competition between firms. The overall aim of the competition assessment is to find a policy approach which encourages competition within the market, subject to achieving the wider policy objectives.

The sector most likely to be directly impacted by proposed measures is the commercial fishing industry. Both management options would place spatial and gear specific restrictions across the specified protected areas. The introduction of fisheries management measures may lead to competitive disadvantage for commercial fisheries actively operating within a given spatial area, potentially restricting the output capacity of the sector. However, given that as an activity is likely to be displaced instead of lost, these impacts are negligible. It is not expected that the distribution of additional costs will be skewed towards smaller entrants relative to larger existing suppliers.

A. Will the measure directly or indirectly limit the number or range of suppliers?

No. It is unlikely that the introduction of the fisheries management measures outlined will directly limit the number or range of suppliers.

B. Will the measure limit the ability of suppliers to compete?

Limited / No Impact. The introduction of fisheries management measures could affect the spatial location of commercial fisheries activity and may restrict the output capacity of this sector. However, restrictions on fishing locations may well be negated by displacement i.e. vessels fishing elsewhere. It is not expected that the distribution of additional costs will be skewed towards smaller entrants relative to larger existing suppliers.

C. Will the measure limit suppliers' incentives to compete vigorously?

No. The introduction of fisheries management measures is not expected to reduce suppliers’ incentives to compete vigorously.

D. Will the measure limit the choices and information available to consumers?

No. There will be no discernible impact on the average consumer.

Consumer Duty

The Scottish Government definition of a consumer is “anyone who buys goods or digital content, or uses goods or services either in the private of public sector, now or in the future.”

Due to restrictions on fisheries proposed under this policy, there is potential for a short-term reduction in landings, but it is not anticipated this will impact the availability of goods for an average consumer. The measures are estimated to reduce the average annual value of output landed by the commercial fisheries sector by between £0.7m - £2.7m (Option 1) and £4.8m - £8.0m (Option 2), out of a total annual turnover of around £600 million for Scottish vessels^[25].

Under Option 2 there are higher impacts on landings, leading to potential for an increase in price for the consumer. It is not possible to quantify this potential increase. The annual loss in volume of landings is estimated to be 2,048–10,198 (tonnes) under Option 1, and 11,353–21,910 (tonnes) under Option 2. In 2019, Scottish vessels landed 393,000 tonnes^[26]. This equates to 0.52%-5.58% of landings impacted.

It is anticipated that fisheries displacement will mitigate some of these impacts. The anticipated environmental protection will also provide benefits to fish stock recovery (discussed in benefits), which will support fisheries in the longer term.