Consultation on meat hygiene charging gets underway

If adopted, the new charging regime will restructure the present system. At the same time the proposals will reduce the Government subsidy that currently gives significant support to meat businesses across the UK .

There are two main strands to the consultation. The first is to introduce a new system of calculating charges based on the time-cost of the inspection process. This would replace the current system based on number of animals slaughtered or weight of meat that is cut up. The second aspect of the proposals will aim to recover a greater share of the costs of the official controls by increasing the charges by up to 9%. These proposals are outlined in more detail below:

• to introduce a new system of calculating charges based on the time cost of the inspection process at approved meat businesses in Northern Ireland
• to increase charges by one of the following amounts: i) 4%; ii) 6%; or iii) just under 9%, all inclusive of inflation. This takes into account the increase that will take place in January 2009 to comply with European Commission (EC) minimum charge rates. These include an increase of 18% to the charge rate for adult cattle and 20% for turkeys
• to introduce a charge for the official controls of the removal of specified risk materials and additional BSE controls which are carried out to combat vCJD. If adopted, the new charge would recover 5% of the total cost of carrying out these controls from the industry across the UK

There are further proposals on which the FSA is consulting. One of these relates to Business Agreements to ensure that the relationships between DARD Veterinary Service, Veterinary Public Health Unit (VPHU) and the operators of approved meat businesses are put on a more collaborative footing. This would enable the inspection process to be carried out more efficiently which, under the proposed time-based charging system, should therefore reduce both the costs to taxpayers and charges that would otherwise be payable.

Any changes to the current system would be expected to come into force on 29 June 2009.

Jim Ross, Head of Meat Hygiene and Imported Food at FSA Northern Ireland, said: 'The FSA is committed to ensuring that consumers are protected, businesses are able to operate effectively and the interests of taxpayers are taken into account. VPHU is already making significant progress in reducing its own operating costs and now these proposals, if implemented, would encourage much more efficient use of resources by both VPHU and businesses.

'VPHU and approved meat business operators are already working together to ensure that official controls are effective and efficient. The proposed introduction of time-cost charges would further encourage this collaborative working.

'Moreover, this will reduce the subsidy that the industry receives from the taxpayer, which is currently inappropriate and unfair. But at the same time, we are committed to continuing to support those businesses in need of a helping hand and these proposals will not undermine the industry, no matter the size of the operator or where the business is located'.

As required by EC law, meat businesses are currently charged for meat hygiene controls. Since the introduction of the Maclean formula for charging, businesses have been charged the lower of either the time-costs or a standard charge per animal slaughtered or per tonne of meat cut up. This was introduced to protect small and medium-sized red meat slaughterhouses that were in financial difficulty following the introduction of increased veterinary supervision required by EC legislation. However, the Maclean formula is unable to be targeted effectively and as a result the vast majority of approved meat businesses have benefited from the Government subsidy it supplied – this equated to approximately £19m over the last five years in Northern Ireland. In future, the proposed time-cost charging would enable any continuing support to be targeted to businesses most in need, such as those with low throughput, or that are situated in remote regions.

In July 2008, the FSA Board decided that the MHS should make significant reductions to its operating expenditure and that industry should make a greater contribution to the overall cost of the inspection process. VPHU is committed to reducing costs in line with MHS targets.

The current annual cost of the inspection process in Northern Ireland is £7.1m and industry’s present contribution to this cost is approximately £3.2m. If the FSA’s preferred charge increases come into force, industry’s contribution would increase by less than £106k and most businesses would continue to benefit from discounted charges.

The consultation will close on 26 March 2009. Responses will then be considered by the FSA Board before a final recommendation is made to Ministers in all four nations.

1. This applies to adult bovines and all turkeys except those which are adult and weigh over 5kg.

2. In Northern Ireland official meat controls are carried out by DARD Veterinary Service, Veterinary Public Health Unit (VPHU) on behalf of the Food Standards Agency.