Fishermen are being accused of cutting deals with the Ministry for Primary Industries (MPI) to avoid prosecution over dumping catch.
A study released yesterday claims over the past 60 years, close to 25 million tonnes of fish have been caught and not recorded.
Lead researcher Dr Glenn Simmons of the University of Auckland told Paul Henry on Tuesday fishermen are getting away with it because MPI looks the other way.
"Observers have told me every time they've reported stuff in the past, it's put in the too-hard basket," says Dr Simmons.
"Compliance officers have told me their reports have been ignored. Fishermen have told me deals have been cut -- they won't be prosecuted if they're seen discarding fish."
It's called high-grading -- throwing away perfectly good fish that are too small or the wrong species. Dr Simmons says it's a direct result of the current quota management system (QMS).
Environmental group Sea Shepherd, best-known for its high-seas battles with Japanese whalers, wants the QMS reviewed immediately.
National coordinator Michael Lawry says the damage done to fish stocks over the past six decades has been enormous.
"We've lost a lot of our important marine mammals...so we've really made a bit of a mess really. The QMS itself doesn't appear to work at a very, very basic level."
Fishing boats, particularly those using nets, always end up catching some fish that don't fall into the right category.
"It's very difficult for fishermen to target one particular species, and that's the way the QMS works," says Mr Lawry. "In actual fact... they're going to pick up a variety of species."
MPI has rubbished Dr Simmons' work, saying it "relies heavily on anecdotal evidence to apply multipliers to reported catches and discards". The department says New Zealand fish stocks are "healthy".
But Mr Lawry says MPI itself has research which backs up the study's conclusions. Dr Simmons says MPI has done "numerous" internal reports which show the same thing.
He wouldn't accuse MPI's Dave Turner of lying, however, suggesting he might not have all the facts.
"I don't know if he knows it, but certainly it's the party line."
MPI has conducted 1000 vessel inspections since 2009, and laid 10 successful prosecutions. It doesn't have observers and cameras on all boats however. Dr Simmons says other fishing countries do, including Iceland and Canada, and New Zealand could too if instead of just exporting fish, we turned the catch into something more valuable first.
"They land every single part of the catch and they have full electronic monitoring... 100 percent observer coverage. It would certainly create jobs," he says.
"Our problem is we're producing low-value commodities... it's simply moving up the value chain."