December 30, 2008

UK may reduce meat inspection subsidies

The UK's Food Standards Agency (FSA) has proposed a reduction of the annual GBP54 million (US$78.1 million) subsidies on meat inspection costs and transfers the final bill to the industry.

Under the proposal, the FSA will introduce a new system of calculating charges based on the time-cost of the inspection process, replacing the current system based of number of animals slaughtered or weight of meat that is cut up.

The proposal also aims to recover a greater share of the costs of official controls by increasing charges by up to 9 percent.

FSA chief executive Tim Smith said the proposal aims to reduce the inappropriate and unfair government subsidy, and to encourage more efficient use of resources to significantly reduce the overall burden on the meat industry.

The meat industry wants the overall cost of running the MHS to have reduced to a point where there is no need for any significant increase in charges, according to Norman Bagley, policy director at the Association of Independent Meat Suppliers.

Over the next three years, MHS annual running costs can be reduced by at least GBP20 million more than the current GBP75 million forecast, which by then there would be no need for any significant increase in inspection costs, said Bagley.

If the proposal is approved, the industry's contribution would increase by less than GBP4 million and most businesses would continue to benefit from heavily discounted charges, said Smith.