Proposed changes to the charging arrangements and charging levels for official meat controls carried out in Scotland

Introduction

Comments and views are requested on proposals to revise the charging arrangements for official meat controls in approved meat premises (slaughterhouses, game handling establishments and meat cutting plants) and the charge rates that apply to them, and to introduce new charging arrangements that would apply in certain cases where such controls are carried out on-farm.

Responses to this consultation will provide evidence for the Agency’s final advice to Ministers. It should be noted that Scottish Ministers are responsible for making final decisions on charging policy, and have emphasised the need to have a comprehensive assessment of the costs, benefits and impacts of these proposals before any decisions are taken.

The proposals form part of a dual approach to cutting official control costs to taxpayers. This approach consists of reducing the overall costs of carrying out official controls without reducing the effectiveness of the controls, and recovering a greater share of the costs from industry to reflect the benefits that they derive from them, such as maintaining consumer confidence in meat. They are in line with decisions made by the FSA Board at an open meeting on 17 July 2008. Among other things, the Board decided that industry should be charged an increasing proportion of the costs of official meat controls while, at the same time, the MHS should continue to reduce substantially the overall costs of carrying out those controls by delivering them more efficiently. The Agency is continuing to work on these objectives in liaison with industry representative organisations. The proposals in this consultation document relate to the charging arrangements and the share of the costs that we propose should be recovered from the industry from 29 June 2009, and Ministers in all four UK countries are content that we consult on them.

The proposals are summarised below and explained in detail in the attached consultation document. As indicated above, the proposals were developed in discussion with industry representative organisations and take account of views expressed at meetings with other industry stakeholders. In particular, the proposals would ensure that significant support would continue to be given to low throughput meat businesses. We intend to continue our dialogue with stakeholders throughout the consultation period to obtain as many views as possible and to ensure that the Agency has a good understanding of the impact of the proposals before final recommendations are presented to Ministers for agreement in all four countries of the UK. It will only be at this stage that final decisions will be taken.

Background

Official meat controls are carried out in Great Britain (Scotland, England and Wales) by the Meat Hygiene Service (MHS), which is part of the Food Standards Agency¹. These controls provide assurance that slaughterhouses, meat cutting plants and game handling establishments produce meat for human consumption that is safe and that animal health and welfare requirements at slaughter are met. Public heath is the key priority for the Agency and there is nothing in the proposals that would adversely affect the protection of public health. Rather, the introduction of time cost charging, as we propose, would provide an incentive for businesses to improve their standards of compliance with relevant food law.

EC regulations set out minimum meat hygiene and animal welfare at slaughter official controls (referred to from here onwards as ‘meat hygiene controls’) charge rates per type of animal or per tonne of meat that apply to all Member States. These rates are specified in EC law in Euros and need to be converted into pounds sterling. Current national regulations provide for the Pound/Euro exchange rate to be set each September to apply throughout the following calendar year. From January 2009, it will be necessary for a number of charge rates to rise to ensure that the UK remains compliant with the minima. These increases will apply automatically under the current Regulations and hence are outside the scope of this consultation. However, as explained below, we have taken account of these increases in the proposals for further increases to charges to apply from 29 June 2009.

The proposals

In summary, the main proposals are to:

• Introduce a new system of calculating charges for meat hygiene controls carried out in approved slaughterhouses, game handling establishments and meat cutting plants in Scotland, based on the time based cost of carrying out these controls.
• Increase charges for these controls by either 4% (broadly to cover inflation only), 6% (inclusive of inflation) or an increase that would recover an additional £3 million over a full year, currently estimated to be just under 9% (inclusive of inflation), with the last of these options being preferred. In proposing these options we have, as explained in paragraph 6 above, taken account of the increases to certain meat hygiene charge rates that will apply automatically from January 2009 to comply with EC minimum charge rates (see paragraph 3.2.1.1 and 3.2.1.2 of the attached consultation document). These include an increase of 18% to the charge rate for adult cattle and 20% to turkeys except those that are adult and weigh over 5kg.
• In relation to poultry slaughterhouses, we are also proposing to reduce by 5% (from 100% to 95%) the deduction made from meat hygiene charges in respect of the costs borne by some businesses in employing Plant Inspection Assistants (PIA) and to base this deduction on a standard hourly rate of £11 for PIA employment costs. The additional revenue that would be recovered from the proposed changes to the treatment of PIA costs are included within the industry-wide 9% increase to charges that is proposed.
• Introduce a new charge, again on a time-cost basis, to recover approximately 5% of the total cost of Specified Risk Material² (SRM) official controls³ across Great Britain, including the cost of additional BSE controls⁴ that apply to cattle slaughtered for human consumption that are required to be tested for BSE. Views are sought on whether the introduction of this charge should be deferred until 2010/11.

We are also proposing to:

• Enable charges to be made, again on a time cost basis, for official controls work that is done on farm or other place of origin. This is to enable the MHS to carry out this work, if they are asked to do so, such that the MHS competes fairly with local businesses.
• Require businesses to declare their intended working hours and working practices for which official controls would need to be provided and charged. This is to help ensure that official controls time and thus charges are kept as low as is practical.
• Charge a £400 fee for businesses to initiate a review of the MHS’s initial assessment of the staff and time it needs to carry out chargeable official controls at the premises. This fee would contribute towards the cost of having an industry representative assisting with the review and would be repaid if the business’s case was upheld.
• Following the above mentioned review, to give businesses the right of appeal against the MHS’s final assessment of the staff and/or hours needed to carry out chargeable official controls at the premises.

In addition, we would appreciate comments on the introduction of Business Agreements between the MHS and businesses, which seek to match the businesses' working hours and practices with the official control resource that the MHS considers is needed by the business. This is explained more fully in the attached consultation document (see proposals 5, 6 and 7 and appendix 4). The MHS intends to reach an agreement with every approved business to put MHS/business relations on a more collaborative and business oriented footing, aimed at ensuring that the official controls can be carried out efficiently and that their cost is kept as low as possible. The introduction of the agreements has already started using the provisional arrangements set out in appendix 4 of the consultation document.

Effect of the proposals

Examples of the effect of the proposed meat hygiene charge increases are set out at appendices 1, 2 and 3 of the consultation document and in paragraph 5.42 of the Regulatory Impact Assessment. In addition, businesses may request an estimate of their charges from 29 June 2009 at: timecostcharges2009@MHS.gov.uk.

Overall, the proposals would increase total charges to businesses in Scotland for official meat controls by up to an estimated £587,000 (£3.8 million in the UK) over a full year and are being made against a background of the MHS making significant progress in reducing its costs. The MHS is running ahead of its plan to reduce its costs in real terms from £91 million in 2006/07 to £74 million in 2012/13. These cost reductions will reduce the burden on taxpayers and will also benefit businesses because they limit the increases to charges that would otherwise be necessary.

Comments requested

Comments are requested on the attached consultation document, draft Regulatory Impact Assessment and draft regulations to enable the proposals to be implemented in Scotland⁵. Wherever possible, please provide evidence in support of your views. This is particularly important in relation to any comments you make on the financial or other impacts of the proposals.

Responses need to reach me by no later than 25 March 2009 making it clear whether you are responding as a private individual or on behalf of an organisation/company (with a brief summary of the people the organisation/company represents). Earlier responses would be much appreciated. The operators of approved meat businesses are being alerted to this consultation and invited to respond to it either directly or via their representative organisation.

If possible, please respond using the form (see below), as this would make it easier for us to summarise your comments and to ensure that none are overlooked. The form lists the proposals and matters on which your views would be particularly appreciated with spaces for responses. The form is best completed electronically in Word, as the spaces for comment will lengthen as required.

¹ The Department of Agriculture and Rural Development (DARD) carries out meat official controls in Northern Ireland.
² Parts of cattle, sheep and goats that are not allowed to enter the human or animal food chain as part of the measures to combat BSE and its human equivalent vCJD.
³ Controls set out principally in The Transmissible Spongiform Encephalopathies (Scotland) Regulations 2006 (as amended), SSI 2006 No. 530, Schedule 6 and Schedule 7 paras 1 and 4.
⁴ Controls set out in The Transmissible Spongiform Encephalopathies (Scotland) Regulations 2006 (as amended), SSI 2006 No. 530, Schedule 2. Note: consultation has been carried out on a proposal to increase the age of cattle subject to these controls from 30 to 48 months from January 2009.
⁵ Separate consultations are taking place on regulations to implement the proposals in England, Wales, and in Northern Ireland.

This consultation has been prepared in accordance with the HM Government Code of Practice on Consultation, which states that a consultation must follow better regulation best practice, including carrying out an Impact Assessment (Regulatory Impact Assessment in Scotland). The assessment is included in the consultation documents.

We are interested in what you thought of this consultation and would therefore welcome your general feedback on both the consultation package and overall consultation process. If you would like to assist us to improve the quality of future consultations, please feel free to share your thoughts with us by using the consultation feedback questionnaire.

Consultation feedback questionnaire (Word)

Consultation feedback questionnaire (pdf)

In accordance with the FSA principle of openness our Information Centre at Aviation House will hold a copy of the completed consultation. The FSA will publish a summary of responses, which may include personal data, such as your full name. Disclosure of any other personal data would be made only upon request for the full consultation responses. If you do not want this information to be released, please complete and return the Publication of Personal Data Form. Return of this form does not mean that we will treat your response to the consultation as confidential, just your personal data.

Data protection form (Word)

Data protection form (pdf)

Within three months of a consultation ending we aim to publish a summary of responses received and provide a link to it from this page.

If, after three months, the summary is still not showing, please contact the person who was responsible for the original consultation. Alternatively, you can contact the FSA Consultation Co-ordinator by email: consultationcoordinator@foodstandards.gsi.gov.uk