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Foot and Mouth Disease

Volume 696: debated on Wednesday 14 November 2007

asked Her Majesty’s Government:

What legal options are available to compensate United Kingdom sheep and cattle farmers for their losses as a result of the foot and mouth disease outbreak originating at the Pirbright animal research centre site.

My Lords, the Animal Health Act 1981, as amended, requires that compensation is paid both for animals compulsorily slaughtered as a result of foot and mouth disease and for property, including carcasses, which is seized or destroyed to prevent the disease from spreading. There is no statutory provision for payment of compensation to farming or other businesses for other losses caused by disease control measures.

My Lords, I have no doubt that that Answer has the full force of the government lawyers and the Treasury behind it. None the less, the Minister’s right honourable friend the Prime Minister stated two weeks ago that he would help sheep producers in any way that he could. Will the Minister acknowledge that the foot and mouth outbreak originated from pollution at the Pirbright research centre, which is licensed, regulated and funded by Defra, and that the collateral damage to the sheep industry as a whole across the UK has halved 2006 prices, all because of necessary movement restrictions, market closures and export bans? Surely he will agree that in this unique situation the Government must pay proper one-off compensation to producers for the £520 million in losses that they have sustained this autumn.

My Lords, the Answer involves the full force of the law; nothing else. That is what the Animal Health Act 1981 clearly states. That has been the situation with each outbreak of an exotic disease since then, of which there have been more than a handful. There has been no compensation for consequential losses. Compensation is paid for animals that are directly taken to slaughter or those taken to slaughter on suspicion. This is a disaster for the industry. I do not gainsay that; I am just stating the legal position. I cannot comment on any legal action that may occur relating to Pirbright. Our best estimate currently—the situation obviously still continues; for example, there are no exports of live animals—is that, since 3 August, £100 million has gone to the livestock sector. With regard to its relative size, the sheep sector has been worst hit, with the costs so far amounting to about 7 per cent of its 2006 output. The sheep sector has been very badly affected.

My Lords, the Minister made it clear that he understands that to suffer loss you do not necessarily have to have the disease or even face a cull. The real damage is from the restrictions on movement and the interruptions to markets. What discretion do his officials have to reduce the hugely damaging impact of these restrictions to individual farmers and are they are being exhorted to use it?

My Lords, each of the movement restrictions and the zones has to be agreed by SCoFCAH, the committee of the EU vets. We have not gold-plated anything in that respect. It is true that we had a hiatus when we thought that foot and mouth was over, but we discovered more cases relating to the first outbreak. That was more than unfortunate. We now have the country split into three zones: the foot-and-mouth-free export area, the foot-and-mouth-restricted export area and the foot and mouth area where no exports of any kind of meat are allowed. We are expecting that, by the end of the year or certainly by the beginning of next year, subject to there being no further outbreak—so far, we have every reason to believe that there will not be one—we will be able to allow the export of live animals, if that is desired by the trade; I am sure that it will be.

My Lords, does the Minister agree that the real issue is not the Government’s responsibility for regulatory action but their moral responsibility in respect of the Pirbright institute? In 1966, it was shown that the law in this matter was very narrow—that persons could claim compensation only if their land had been invaded by the virus. If the Government were to shelter behind such a narrow interpretation of the law, they would be avoiding a heavy moral responsibility in respect of massive losses that have been caused by the negligence of a government agency.

My Lords, the situation is not as it was in 1966. I have already said that where animals are taken to slaughter on suspicion—when we have no proof that the virus is present—compensation is paid. The 1981 Act went much further than the 1966 legislation; people are being compensated when animals are taken compulsorily even on suspicion when the disease was not found. On Pirbright, I have said before—I am not playing with words—that it is not a Government-run laboratory. It is run by the Institute for Animal Health. The Government are a customer and a partial regulator along with the private sector company on the site. All the information that we have and all the independent reports into what happened in August have been published. I refer to the Health and Safety Executive report and the report of Professor Spratt. They are clear about where the outbreak originated but I do not think that they are clear about the precise location. This matter will undoubtedly come before the courts; I cannot possibly speculate on that because that would be quite wrong.

My Lords, is the Minister aware that yesterday the “World at One” on Radio 4 carried a report in which it was suggested that British farmers should be assisted in growing more food for the UK market and that a spokesperson for Defra responded by saying:

“It is up to the market to decide food prices. The UK can source efficiently food from a wide variety of stable countries, and that enables Britain to obtain the best value for money”?

Whatever the legal issues surrounding FMD compensation, and notwithstanding all that the Minister said in our debate yesterday, to which I listened with great interest, does not this Defra statement mean that Her Majesty’s Government continue to take food security insufficiently seriously and are prepared to see the terminal decline of the UK farming industry through the pursuit of cheap food and the concomitant exploitation of UK farmers by the retail food industry?

My Lords, the precise answer is yes, I am aware, but I think that that statement was quoted out of context.

My Lords, in his Statement to the other place yesterday, the Secretary of State said that Pirbright was about to recommence vaccine production, yet the improvement plan for Pirbright has not yet been finished. Is that safe, and who, independent of government, has certified that Pirbright is now safe?

My Lords, I am not familiar with the details of yesterday’s Statement because I was attending the debate here, but it can only be the independent regulators. Presumably, this question would be decided not by Ministers but by the Health and Safety Executive, which would give the necessary approval. However, it has been stated that Pirbright can commence working with live viruses both at the Institute for Animal Health and the Merial laboratories. One knows that Pirbright is undergoing a £120 million investment programme—it is a building site and that will continue for some time. The fact is that the laboratories and equipment have been checked over and, so far as I understand, the regulators have agreed that work can recommence with live viruses. That is important because of the possibility of providing a vaccine for bluetongue disease, and it is one of the three laboratories that could provide that.