My Lords, after two previous unsuccessful projects to achieve full cost recovery in 2009 and 2012, the FSA is seeking solutions by working more closely with the industry to achieve better outcomes. At present the Food Standards Agency has no set timetable to move to full cost recovery, but the Food Standards Agency will be reviewing this during the Parliament.
Does the Minister accept that the FSA has reduced its costs to the meat industry by 40% in the last five years? The National Audit Office has given a certificate to that effect—that the charges are fair. That being so, why do we continue to allow what is, in effect, the inefficient part of this £6 billion industry to claim up to 95% discounts, costing the public £25 million? Over the years, Ministers—Labour, SNP and coalition—were, to my knowledge, intensively lobbied not to allow the FSA to go for full cost recovery. Will this Government now stand up for the public?
My Lords, the noble Lord is of course an absolute expert on this subject. He was FSA chairman for four years, I think, if not even more, so he is certainly a terrific expert. The steering group on meat charging, an industry group, was established in 2013 as a mechanism to take forward reform on areas such as the discounts on meat inspection charges. It has an independent chair and is supported and facilitated by FSA staff. It has developed proposals which are currently subject to consultation, which started on 9 March this year and will close in two days’ time. The FSA intends to use the steering group to lead on a review of all areas, including full cost recovery.
My Lords, have the Government done an impact assessment on the possible burden on farmers if these FSA charges are introduced, either in the short term in relation to the extra costs being passed on to what are very marginal businesses or in the long term, when some medium-sized abattoirs which are hugely important locally, are closed as a result of these possible charges?
I thank the noble Lord for his question. This is a very important subject. The FSA does not charge farmers unless they are also the operators of approved premises that slaughter or cut meat; for example, if a farmer also owned and operated a slaughterhouse. As far as smaller abattoirs are concerned, discount proposals which have been looked at by the steering group would allow smaller abattoirs to benefit consistently from the highest levels of discount.
My Lords, last week the FSA announced its five-year strategy and at the same time the Chancellor announced millions of pounds-worth of departmental cuts. Can the Minister confirm that the Government are not looking for further cuts from this important arm of government, which would affect the protection of the nation’s health? Would that not be very short-sighted, and in the long term move the costs from Defra straight to the Department of Health?
I will have to get back to the noble Baroness with a full answer on that subject, but this is all part of the steering group consultation which, as we know, closes in two days’ time. The group has been reviewing all these items during its consultation, and we need to wait to hear what it says before we go further.
My Lords, since local government operates full cost recovery in respect of planning, for example, what is so special about abattoirs and meat-cutting plants? If the Government’s intention is to subsidise the less efficient aspects of the meat industry, why do they not do that openly and transparently and admit that it is a subsidy, rather than disguising it in the costs of the Food Standards Agency?
My Lords, the official controls carried out by the Food Standards Agency are a requirement under European legislation. The regulation that covers charging is currently subject to review. Final decisions in Europe are not expected until late 2015 at the earliest.
My Lords, does the noble Baroness agree that while it might be reasonable to charge full costs to the multi-million pound large and medium-sized abattoirs, we need to protect the smaller abattoirs, particularly in rural areas, and those that serve artisan producers, who have specialists? I was once a goat keeper and we took our goats to a small abattoir. When that went, we could no longer take them to be slaughtered. Small abattoirs provide a valuable service and need to be helped.
The noble Countess is indeed right. In fact, I had a few sheep and used to take them to a private abattoir. This is exactly what the discount proposals will allow for. They will allow the smaller abattoirs consistently to benefit from the highest levels of discount.
My Lords, the noble Baroness is speaking for the Department of Health because ultimately it oversees the Food Standards Agency. Can we come back to the question asked by the noble Baroness, Lady Walmsley? Ultimately, this is a question of public confidence in the food chain. Why have the Government cut, in-year, £200 million of the public health budget given to local authorities? Will that not impact on public education programmes on food and obesity? What is the Minister going to do about that?
I cannot confirm that. On the other hand, we must wait for the steering group to come up with the results of its consultation. It is important to remember that the steering group is part of a larger group, which includes the meat industry. They are all working together, with an independent chair, supported and facilitated by FSA staff, to look into all the problems within this industry.