The Ulster Farmers’ Union (UFU) has warned that proposed changes to financial support for slaughterhouses would “place further pressure on Northern Ireland’s family farms”.
UK’s Food Safety Authority (FSA) recently held a consultation on proposals for a revised system for financial support for abattoirs and game handling establishments in England, Wales and Northern Ireland, including the removal of the meat charging discount scheme.
The FSA is responsible for meat hygiene official controls in approved slaughterhouses, cutting plants and game handling establishments in England, Wales, and Northern Ireland
The FSA told Agriland: "Responses received will inform the final policy and ensure any changes to the discount framework that are recommended to the FSA Board and ultimately ministers are evidence-based, proportionate and transparent."
There are two distinct elements to the FSA’s current ‘meat charging’ regime: The charges for official 'controls' (inspections), and the financial support provided via a discount scheme.
The FSA said its initial assessment of the discount scheme identified two major issues.
Firstly, it said there was “no clear rationale for the funding that could be used to support an evidenced case to ministers for continued support to the sector in line with current ‘Managing Public Money’ guidance”.
According to the FSA, while the greatest proportional support currently goes to the smallest businesses, the largest businesses receive the majority of the discount budget and there was “no clear justification” for either, requiring the authority to “explore this in more depth”.
Secondly, the current scheme is based on the distribution of total official veterinarian (OV) and meat hygiene inspector (MHI) hours, determining the size of businesses relative to each other based on hours they use. These bands are then used to distribute the available money.
However, the FSA said the "business size profile, discount pot and cost profiles have all changed substantially since the scheme was conceived".
"This has resulted in a complex system where it is difficult for businesses to predict and FSA to calculate the level of support they might receive each year," FSA said.
Proposals
The FSA proposed a revised system of financial support for abattoirs and game handling establishments to be provided via discounts to the authority's charges.
It said that this would end "the current system of universal support under which operators receive some discount regardless of size, albeit with support specifically targeted towards smaller businesses".
It would also depart from an approach of determining discounts based on relative bands of hours to one based on historical throughput.
Regarding Northern Ireland, FSA said: “It is potentially beneficial to have the same overall model of support in Northern Ireland as in England and Wales but including recognition of the differences, as is the case with the current discount scheme.
“Under the current approach, this means different band percentages and maximum discount in Northern Ireland. The proposed model no longer has bands that can be manipulated in this way.
"However, should sufficient evidence be established, ministers advised by the FSA could request the FSA to provide discretionary support to those larger Northern Ireland abattoirs."
UFU response
In response to the FSA's consultation, UFU deputy president Clement Lynch said the union made clear that Northern Ireland’s agri-food sector is structured differently from other parts of the UK, with a high number of small family farms supplying a relatively small number of larger processors.
He said: “NI farmers are already operating under severe financial pressure, with rising input costs, volatile markets and reduced direct support.
"Any additional processing costs are likely to be passed back down the supply chain to primary producers, many of whom simply cannot absorb them."
According to Lynch, the UFU stressed to the FSA that Northern Ireland’s "unique circumstances" must be fully recognised
“Our livestock and poultry sectors are central to the rural economy, supporting jobs, local communities and food production across the province.
“We hope the FSA will listen carefully to the concerns raised by the UFU and the wider industry, and maintain the vital support needed to protect Northern Ireland’s farmers, processors and the wider agri-food supply chain.”
The UFU said it believes continued support is "essential" to ensure NI farmers are not placed at a competitive disadvantage and that "the strength and resilience of the local meat sector is protected".