Meat Hygiene Service

HC Deb 31 January 1996 vol 270 cc935-56 10.59 am

Mr. Edward O'Hara (Knowsley, South)

When the Fresh Meat (Hygiene and Inspection) Regulations (1995) were laid before the House in March 1995, I tabled early-day motion 845, in which I posed certain serious questions about the rationale, proposed operation and likely effectiveness of the Meat Hygiene Service. The early-day motion attracted considerable support from a remarkable spectrum of interests across the House, an indication not only of the strength of the case but of the far-reaching implications of the new arrangements for abattoirs and jobs across the country.

Following a prayer against the proposed regulations, they were presented for the scrutiny of the Fifth Standing Committee on Statutory Instruments on 4 April 1995. A devastating case against the regulations and the introduction of the MHS was developed in that Committee with the support of the hon. Members for Clwyd, South-West (Mr. Jones), for Manchester, Central (Mr. Litherland), for Carmarthen (Mr. Williams), for North Cornwall (Mr. Tyler), for Aberdeen, North (Mr. Hughes) and for Ceredigion and Pembroke, North (Mr. Dafis)—an interesting cross-section of Members.

The rationale offered for the establishment of the MHS had three legs—greater cost-effectiveness, greater efficiency and greater consistency in relation to the existing system managed by local authorities. In Committee, it was clearly demonstrated that the MHS would not satisfy any of these criteria.

In terms of cost-effectiveness, the MHS has an establishment that costs about £54 million to run. All these costs must be taken out of the industry in charges. I have heard varying figures for the cost to the industry in charges to local authorities under the old system, ranging from £26 million to £45 million. Whichever figure we take, there is a sudden and serious increase in overheads to be financed by the industry.

I shall not burden the House with excessive repetition of the case made in Committee, as the non-validity of the claims of greater efficiency and greater consistency will be exposed in my remarks today. Suffice it to say that, I made no apology then for stating that there was a crisis in the fresh meat industry in two respects.

First, small and medium-sized operators, such as Sammy Morphet of C.S. Morphet and Co. in my constituency, were predicting that they would be driven out of business by the increased charges. Indeed, in my early-day motion, I asked whether the new system was actually intended as an instrument for enforced rationalisation in the industry. This was a serious question, as to whether we were witnessing rationalisation by statute, rather than by inducement and compensation.

An important aspect of the crisis in the industry was the breach between the hierarchy of the Federation of Fresh Meat Wholesalers—the consultative body for the industry favoured by the Ministry of Agriculture, Fisheries and Food—and people such as Sammy Morphet of Cronton in Knowsley, Thomas Slinger of Greater Harwood near Blackburn, E.D. Jones and Son of St. Asaph, Cig Mon Cymru—I hope that the hon. Member for Ynys Mon (Mr. Jones) will forgive my pronunciation—from Llangefni in Anglesey and Keighley Abattoir Ltd. Mr. Whitely, from the last company mentioned, said in a letter that was passed to me in April, For God's sake make them understand what is going on". Many others have been involved, including Toby Baker of Nailsea. I mention him in particular because he is the secretary of the Quality Meat and Livestock Alliance, to which many disillusioned small and medium-sized operators have turned to represent their interests.

Secondly, many endangered operators are determined not to pay the increased charges with which they are faced under the new system. It is a classic case of "can't pay, won't pay". I have kept in touch with the situation since the introduction of the Fresh Meat (Hygiene and Inspection) Regulations 1995 and the inception of the MHS, and I take no pleasure today in saying, "I told you so". All the predictions have come to pass, and a report in the Daily Mail this week stated that 120 companies are refusing to pay their fees to the MHS, which is facing a shortfall of £14 million in its annual budget.

MHS has served writs on three companies, including that of Sammy Morphet in my constituency. Sammy Morphet is happy to lead with his chin and test the principles at issue in court, the High Court and the European Court of Justice, if necessary. He describes the new system as a shambles, and cites the example of the residue inspection charges. In the past, MAFF checked any meat suspected of containing harmful chemical residues and, as I understand it, made no charge. Under EU directive 86/469, a new system was set up, co-ordinated by the Government's veterinary medicines directorate and run since April 1995 by the MHS.

The charge imposed by the MHS for this service on C.S. Morphet is £12,000 per annum for the analysis of eight pigs' kidneys a month.

The Minister for Food (Mrs. Angela Browning)

I am sorry to interrupt the hon. Gentleman, but he should be aware that, prior to the MHS carrying out the testing duty, Mr. Morphet was invoiced by Knowsley borough council. It was not a free service—he received bills for the inspections.

Mr. O'Hara

There was a dispute at that time between Mr. Morphet and Knowsley council, and the council understood that Mr. Morphet was making a test case at that time. When I was referring to a free service, I meant the service that was in operation before EU directive 86/469. I am grateful to the Minister for pointing that matter out, but I was aware of it.

I was referring to the charge of £12,000 per annum for the analysis of eight pigs' kidneys per month. While £12,000 in itself is a burden on Mr. Morphet's business, he could not believe what happened next. During the summer of 1995, MHS officials arrived at his abattoir with a fridge-freezer, which they plugged into his electricity supply—without asking permission, by the way. Eight kidneys per month were placed in the fridge-freezer by MHS inspectors but, from June to December, no one came from the MHS to collect them. However, on 14 December 1995, Mr. Morphet received a bill for £5,000—for the inspection of the kidneys that were still in the refrigerator.

In case one thinks that that was an isolated case of cavalier charging in the meat industry, I shall give the example of Cig Mon Cymru, from the constituency of the hon. Member for Ynys Mon. In March 1995, the firm received its last bill from the local authority for inspection services at its abattoir in Llangefni. The charge was £9,945.18 for 60,061 sheep slaughtered in a four-week period, which works out at 16.56p per sheep. On 27 June, the firm received its first invoice from MHS for a two-week period from 3 to 14 April 1995, when 25,699 sheep were slaughtered. The bill was for £6,405, or 24.92p per sheep—an increase of 50 per cent.

There are by-products of these increases. For example, the increases are not uniform across the industry, so livestock traders will pick and choose their abattoirs. That can mean that a longer distance is travelled by live animals for slaughter. Jobs are being lost in abattoirs, which may have to close for that reason or because of heavy charges alone. The current position also encourages live exports to Europe, where abattoir rates are cheaper. No wonder Sammy Morphet faces an extra £30,000 a year in charges for his average throughput of between 2,000 and 3,000 pigs per week.

Another example of cavalier charging relates to the recognition of experienced slaughterers. The industry might understand a charge of £65 for the validation of newcomers to the trade, large though the increase is in comparison with the original nominal fee of £1-the charge may have been reduced recently; I do not know the exact figure—but experienced hands in slaughterhouses not only consider the charge exorbitant, but find it demeaning to be validated by official veterinary surgeons who, although they may have professional veterinary skills, do not possess the manual skills with the knife that are the essence of the slaughterer's trade.

That brings me to the nub of the dispute between the dissident element in the trade and the MHS. The justification for the new system is the implementation of European directives governing meat hygiene. No one argues with the principle, but it must be asked how the new charges here can be higher than charges elsewhere in Europe. In fact, the question, "How are the charges so high?" is easy to answer; more interesting is the question, "Why are they so high?"

Let us deal with the "how" question first. Ante and post-mortem inspections are carried out in abattoirs in accordance with European Union directive 91/497. Under the MHS, they are conducted by official veterinary surgeons, who cost more than mere meat inspectors. Yet it is maintained that the identification of unsound meat is a special skill that can be acquired by technicians who do not need the full range of skills possessed by the veterinary surgeon—stockmen or slaughterers, for instance. Indeed, it could be argued that a typical OVS does not possess the knife skills that are necessary for the post-mortem examination of a carcase under directive 91/497. Official veterinary surgeons are expensive—and that is why MHS costs are so high.

Members of the trade would maintain that OVSs are not needed in static postings in all abattoirs. Indeed, it could be said that it is their visible input in static postings that has lowered their credibility among experienced practitioners in the trade. OVSs would make better use of their specialist skills, and recover their credibility, in the role of monitors of meat inspectors in more than one abattoir. The resultant service would be cheaper, too, and directive 91/497 would be met. I understand that the system works satisfactorily elsewhere.

Let me make two further points. First, it may be asked what the ante-mortem inspection achieves that cannot be achieved by the post mortem. Secondly, I am advised that the whole system of inspections is—here I use a word that I have used before—a shambles. Abattoirs are reporting variations of as much as 400 per cent. in the inspection hours allocated to similar slaughtering operations. In some abattoirs, inspectors will examine "green offal"—stomachs and intestines—and in others they will not. Some inspectors insist on being present throughout the time when killing takes place; others do not. The Government have cited inconsistencies between local authorities as a justification for the new system. So what is different?

Previously, if a proprietor had a complaint or query, he or she had only to call in at the local council office; now he or she must try to communicate with a remote organisation in York. No wonder it is known as the Kremlin: it cannot communicate answers to simple questions such as how many hours are being charged for when invoices are presented.

MHS field staff are no less bewildered. They find themselves being arbitrarily allocated to slaughterhouses miles from their former work places, and doubtless their travel costs are passed on to the slaughterhouses. They find that overtime is subject to random variations, and that—especially in the case of part-time inspectors—work is erratic and uncertain. They find that the overwhelming burden of paperwork takes colossally more time than under the old local authority system, and they must endure a constant flow of confusing edicts and counter-orders from York. That is what I mean by a shambles.

Mr. David Nicholson (Taunton)

On 4 April last year, a Standing Committee implemented the regulations. The hon. Gentleman was a member of the Committee; I attended, although I was not a member. When I asked my hon. Friend the Minister to assure us that the system that was about to be introduced was the simplest and most cost-effective system that could be introduced consistent with the European directive, she told me that there would be close contact with the MHS to ensure that the organisation's costs are held down year on year."—[Official Report, Fifth Standing Committee on Statutory Instruments, &c., 4 April 1995; c. 8.] The hon. Gentleman has done Parliament and the country a great service in bringing to our attention horrific evidence of the costs of the new system, and I wish him well in his efforts.

Mr. O'Hara

I thank the hon. Gentleman for his support. Sadly, all the horrifying predictions are coming true.

I said that the organisation was a shambles. That brings me to the other question that I posed: why does such a system exist? That, as I said, is the interesting question. The answer lies in the nature of the MHS, which is not a simple quango but a self-financing regulatory authority, or SEFRA. It has an establishment of about 1,000 staff, and its total running costs are some £53 million or £54 million—all to be financed from charges levied from the trade. It is not subject to Treasury strictures and controls like other quangos—like, for example, my local NHS hospital trust, with which I had some dealings earlier this week. It is currently having to cope with a directive to cut management costs by 5 per cent. and allocate the savings to front-line services.

A SEFRA, however, has every incentive to perpetuate its bureaucracy by imposing ever more, and ever more unreasonable, regulations on what it calls—in a distortion of the term—its customers. It means the trade. The customers of the MHS are, in fact, the public, whose health it purportedly exists to protect. It is as if the police financed their traffic services with the fines levied on speeding and over-the-limit motorists, and called them their customers.

There is, however, a more sinister aspect, which also derives from the nature of a SEFRA. I mentioned earlier that a large block of the trade—some 120 firms—had lost faith in the Federation of Fresh Meat Wholesalers. That is because they feel that the big operators who are the hierarchy of the FFMW are supporting the MHS, with all its faults, precisely because its operation, as I have described it, will drive the small operators like Sammy Morphet out of existence. I shall not use the term "unholy alliance", but there is a convenient coincidence between the interests of the big operators and those of the people who run the MHS.

What is in it for the big operators is that they will eventually dominate the trade when the small operators are driven out of business; what is in it for those who run the MHS is a lucrative, risk-free business with rich remuneration. That is why last year, in early-day motion 845, I questioned the interests involved in that risk-free business.

What is the prognosis for the long term? When the big operators have the field to themselves, they will call the shots. They will be in a position to dictate to the MHS. For example, by threatening to relocate elsewhere in Europe—many are multinationals—they will be able to expose the MHS shortfalls in fee income and so ensure that their wishes dominate the continuing activities of what is called the "Service". The technical term for that is regulatory capture.

I am talking about cartels. They will be able to force the imposition of new regulations, which will drive smaller rivals out of the trade and prevent newcomers from coming into it and it will all be done in the name of such virtuous cloaks as meat hygiene.

I have the evidence for that in a letter from the general secretary of the FFMW to the principal finance officer of the Ministry of Agriculture, Fisheries and Food, dated 8 November 1995, which refers to unpaid bills that existed at the time and includes the words: it would be helpful to this end for the Minister to stick firmly to his stated intention not to issue licences to plants which have not achieved the structural standards required by the end of the derogation period on 31st December 1995, (except in exceptional circumstances beyond their control). This is the interesting point: This would have the effect of at least preventing a number of plants who have no intention of fully complying with the legislation or paying MHS bills from continuing to exacerbate an already serious situation". That is a sinister comment in a letter from an officer of the FFMW to an officer of MAFF.

What will be the consequences for the true customers of the MHS—the meat-buying public? There will be a reduction in consumer choice, as the fewer large outlets will concentrate on standardised fare to the exclusion of the variety of livestock breeds available through smaller, specialist outlets. I imagine that such outlets exist in constituencies like that of the hon. Member for Ynys Môn—in rural areas.

The cartel will be able to control prices to a much greater extent because small, independent livestock buyers will be removed from the market. There is a close analogy with the domination of the retail trade by the giant supermarket chains. But, in the case of the meat industry, there is an added and serious dimension. Food safety—the ultimate rationale of the MHS—will deteriorate. With fewer, larger units processing greater numbers, there will be increased danger of cross-contamination in slaughterhouses, increasing the spread of such bacteria as the salmonellas, campylobacter and E. coli 0157. Incidentally, it is worth noting that the only E. coli outbreak ever associated with meat came from a fully approved EU slaughterhouse of the type that I predict will dominate the trade. Tracing sources of infection will become inestimably more difficult and the break-up of the present food hygiene system, with the introduction of the MHS, will make it more difficult to trace food poisoning. In short, we are not merely looking at a monster in the creation of the MHS, but at a nightmare for public health.

The local authority system, for all its faults, was not broken, although it may have needed some fine tuning in keeping with progressive demands. Sadly, however, one cannot expect local authorities, pressed as they are to meet their statutory responsibilities in many fields, suddenly to step in and bail out the Government by resuming a responsibility so summarily removed from them.

Yet a system is needed to enforce the regulations, which necessarily and rightly flow from EU directives on meat hygiene. The interesting thing about the abomination of a system that the Government have introduced under the Fresh Meat (Hygiene and Inspection) Regulations 1995, is that it makes the option of opting out of the EU regulations more attractive than it otherwise would have been to many people. There are those who say that we should opt out for ideological reasons. Others are saying that we should do so because the system is such a mess.

Given that the EU is reviewing the meat inspection system to bring it into line with more modern systems of risk assessment, there is scope for returning the responsibility for inspecting their own produce to the meat traders, leaving the regulatory officials the simple task of monitoring systems in the same way as they are monitored for the rest of the food industry.

I conclude with this appeal to the Minister: pursue that self-regulatory line in Europe, pressing for the development of systems that will make the MHS redundant as soon as possible. She would thereby be doing a great service to the economic health of the fresh meat industry, the jobs of people employed in it and, more importantly, to the health needs and wealth of choice of the meat-buying public.

11.25 am

Mr. Nicholas Winterton (Macclesfield)

I congratulate the hon. Member for Knowsley, South (Mr. O'Hara) on obtaining this debate. Having listened carefully to everything that he has said in the past 25 minutes, I must tell my hon. Friend the Minister that I find it difficult, if not impossible, to disagree with anything. The hon. Gentleman has spoken the truth and put forward the case on behalf of the meat industry and I endorse not only what he said, but his request that that monstrous edifice and organisation in York be abolished at the earliest possible date, given all the unnecessary on-costs that it carries.

Macclesfield has long-standing historical connections with the farming and livestock industries. There is a splendid market at Chelford, which is owned and run by Frank R. Marshall—a company that has been in business for more than 100 years. Another market is on the borders of my constituency, lying in that of my hon. Friend the Member for Congleton (Mrs. Winterton), who is away on an Agriculture Select Committee visit—otherwise she would be here supporting the views expressed by the hon. Member for Knowsley, South. That cattle market is owned and run by Whittaker and Biggs.

I have regular contact with small, private butchers, who are members of the Macclesfield and District Butchers Association—an organisation that still exists despite the tremendous competition from the superstores, such as the Tescos, Safeways and Sainsburys of this world. Funnily enough, I am going to its annual dinner and dance in only a few weeks' time. I applaud the role that the small, family butcher and the small and medium abattoir play in the life of the farming community and in that of many rural towns and villages.

Macclesfield is also home to a most excellent slaughterhouse, operated by TTS Meats on the Hurdsfield industrial estate. It is on behalf of that slaughterhouse, those who own it and supply it, those who are employed there and those who ultimately benefit from the high-quality products that it provides for customers that I have been conducting an on-going and determined correspondence with my hon. Friend the Minister and the Department for a considerable period of time. I am deeply concerned about the significant and adverse impact that dramatic over-regulation and excessive—I really mean that—administrative charges have imposed on that slaughterhouse and other small and medium slaughterhouses.

My passion for deregulation is well known to the House. It is a passion that I had been led to believe was shared by my colleagues in the Government. I despair of the way in which the Meat Hygiene Service was set up by MAFF and of how it has operated.

Abattoirs are singled out for extra regulatory controls, unique in the food industry: the presence of full-time public sector/agency officials to inspect the supervised hygiene procedures for meat and to apply what I would call a "health mark". They are also required to pay an inspection levy that enables the MHS to recover the costs of the health controls. The hon. Member for Knowsley, South mentioned that £54 million has to come out of the industry each year.

All other food businesses are essentially self-regulating. Operators take responsibility for compliance with regulations under the food safety legislation without having to pay direct enforcement costs. There is no evidence that that way of operating is anything other than successful. For slaughterhouse operators, the cost of funding public sector/agency meat inspectors has increased considerably and resulted in controversy, anger and resentment throughout the industry. I do not think that I can be contradicted when I say that the industry is totally opposed to what has happened.

Millions of pounds are involved annually in meeting this hidden but unavoidable tax, which leaves the British slaughterhouse industry at a competitive disadvantage in Europe—a point eloquently made by the hon. Member for Knowsley, South. That threatens to drive it out of business altogether. Many hon. Members could name slaughterhouses that have gone out of business, to the disadvantage of the agricultural industry and of the communities in which they were located.

I refute absolutely the argument that the current punitive regime of inspection and fees is necessary on public health grounds as my hon. Friend the Minister will, no doubt, argue in her response. Ministers from her Department frequently come before the House and assure us, I believe rightly, that British meat is safe. She has said that time and again in recent weeks and I agree whole-heartedly with her. It is safe. However, that is not because of the bureaucratic empire that has been built and financed by sucking the blood of smaller businesses, but because most operators are responsible in their approach to hygiene and public health. They know that that is their duty and that they will suffer sanctions if they are not responsible. They know that the customer, Mr. and Mrs. Citizen, has never been more aware of, or demanding about, food safety issues and they respect that.

Meat hygiene legislation is founded on two fundamental myths. The first is that the slaughtering stage of the meat production chain presents special health risks that can be eliminated only by the full-time presence of public officials. The second is that abattoir operators, uniquely in the food industries, are either incapable or irresponsible in their approach to the introduction and implementation of adequate control measures. Neither of those misrepresentations can stand close scrutiny, but, until this debate, they have never been challenged on the Floor of this House.

In a food scare climate, which frequent outbreaks of mad media disease have exaggerated and misinformed ever since the first salmonella salvo from my misguided hon. Friend the Member for South Derbyshire (Mrs. Currie), public officials with jobs and empires to protect have shown even less inclination to question their purpose in life. Fresh meat is a low-risk food and current hygiene legislation has been demonstrated to have nothing to do with health control.

The greatest risk in the food chain, to those who know anything about it, is not slaughterhouses but the way in which cooking, preparation, storage, display and serving of food are undertaken. The wealth of scientific evidence to support that view was ignored by the House in 1992 when the meat hygiene regulations were introduced. It was against the background of sensational and irresponsible reporting by the media, faulty technology and a questionable law that the creation of a centralised meat hygiene service was pursued—wrongly, in my view. It is not surprising that dissent, confusion, anger and frustration have followed.

The regulations are not only unnecessary but, I say in support of the case of the hon. Member for Knowsley, South, anachronistic. They belong to another age and have no part in a modern society. Fresh meat is not a hazardous food. The sensible measures that are required to produce safe, good-quality meat are well within the capability of competent butchers. Abattoir operators can achieve the necessary standards in the context of the Food Safety Act 1990 without being singled out for trampling under the iron heel of Meat Hygiene Service charges.

Today, that iron heel demands that if an abattoir has enough turnover to keep an inspector occupied for only one hour a week, the operators nevertheless have to continue to pay for 40 hours' inspection charges. Such blatantly unfair practices, ridiculous overcharging, unacceptable levels of inspection and total lack of consultation have led to turmoil in the industry. Responsible business men and women are refusing to meet the unreasonable bills that they are being sent. I hope that my hon. Friend the Minister will not ask whether I support such action. I perhaps would not give a direct answer but I fully sympathise with them and believe that they have a very good case for taking that action.

Abattoirs faced, as the Minister knows, an immediate 25 per cent. increase in inspection charges when that monstrous body, the MHS, wrested responsibility from local authorities, to which I pay a tribute for the role that they previously played in the industry. On a turnover of £3 million a year, a typical slaughterhouse faces inspection charges of a staggering £50,000 annually. Businesses cannot survive in such a climate.

Furthermore there is patchy commitment on the part of the service to the implementation of the rules. That was referred to in a number of cases mentioned by the hon. Member for Knowsley, South. Responsible traders, who feel morally obliged to comply with regulations that require massive investment, are understandably bitter when they see the Meat Hygiene Service in other areas fail to take action against those who flout the regulations. While we have these regulations and this monstrous body, let the regulations be evenly implemented throughout the country. I do not like to look to Europe too much or too often but let us consider the charges that apply on mainland Europe.

It is high time that there was a root and branch reform of the Meat Hygiene Service and, what is more, of the principles upon which it is based. I hope that my hon. Friend the Minister, in replying to the debate, will agree to such a review in addition to the request made by the hon. Member for Knowsley, South. I hope, too, that other hon. Members, perhaps those who serve on the Agriculture Select Committee, will consider this important matter and take steps to save our abattoirs before they are dismembered on the butcher's block of excessive bureaucracy.

11.38 am

Mr. Paul Tyler (North Cornwall)

I congratulate, as will the whole House, the hon. Member for Knowsley, South (Mr. O'Hara) not only on bringing the matter before us but on the unstinting way in which he has examined the problems inherent in the Meat Hygiene Service. I hope that the Minister will note that any issue that brings together the hon. Member for Macclesfield (Mr. Winterton), the hon. Member for Knowsley, South (Mr. O'Hara) and myself must be of wide significance in rural areas. I want to deal briefly with three specific issues and underline the points already made by other hon. Members.

My first point concerns the rationale for setting up the Meat Hygiene Service. At the time, there was some misunderstanding and misapprehension—it was thought that the MHS in its present form was set up at the direct instigation of the European Union and the European Commission. Nothing could be further from the truth. On 5 April 1995, in the Fifth Standing Committee on Statutory Instruments, the Minister was good enough to say that that was the case. The MHS is a British organization—it is the product of the thinking of the Ministry of Agriculture, Fisheries and Food. It is not some wicked Brussels bureaucratic plot.

As the hon. Member for Macclesfield has said, it is significant that other parts of the European Union have adopted different techniques, mechanisms and institutions to fulfil their obligations under the treaty of Rome and the directives. We need to know today—we pressed the Minister on this in Committee and did not get a wholly satisfactory answer, although I admit that that was because the institutions were comparatively new—what the comparable arrangements are in the other 14 states, as they now are, and if they are as expensive, as bureaucratic and as burdensome as the hon. Members have said. What is the competitive position in the so-called single market?

The hon. Member for Knowsley, South referred to the way in which the MHS has been set up and its responsibilities to its customers, to Parliament and to the nation. I repeat the statement made by the Minister in answer to a number of our questions in the Committee. She said: I reiterate that the MHS is answerable to the Minister, who is ultimately answerable to Parliament. That is the line of communication. There is therefore no question of its being a stand-aside quango which is unaccountable and can go its own way". Through the Minister, the MHS is answerable to the House—that is why the debate is vital and timely. It is an opportunity for the Minister to answer for the MHS. Note again: there is no question of the MHS being answerable in any sense to the bureaucrats of Brussels.

It is extremely important that we acknowledge the debt that we all owe to Christopher Booker, who has also considered this issue carefully and has identified the extent to which the responsibility lies fair and square with Whitehall. This problem was home grown, within a few hundred yards of this building. It is nothing to do with Brussels.

Secondly, I know that the Minister and the hon. Member for Taunton (Mr. Nicholson) will share my concern at the way in which, over recent years, the regulations—not just since the MHS has accelerated the process—have impinged on the smaller abattoirs in south-west Britain. The same may be true in Wales and in other parts of the United Kingdom, with which I am not so familiar.

In Committee last year, we were able to demonstrate, using the Meat and Livestock Commission's figures, that the reduction in the number of abattoirs had been accelerating as the regulations came into place in 1992. That acceleration had increased. I hope that the Minister will be able to give us the latest figures for the number of abattoirs. It is not the throughput but the number that is important. That is what is geographically significant.

Mrs. Browning

In the past three years, 51 abattoirs have closed. From 1971 to 1992, when the regulations on fresh meat came into force, 62 abattoirs per year closed. That is a significant difference.

Mr. Tyler

I am grateful to the Minister. Clearly, the fact that closures have occurred and are continuing since we raised this issue with her in Committee last year must be a matter of real concern.

Mrs. Browning

In three years, 51 abattoirs have closed, compared with 62 closures per year from 1971 to 1992. That is a significant reduction.

Mr. Tyler

That is precisely the point that I was trying to make. In Committee last year, the Minister gave us assurances that that trend would not continue. It is disturbing to find that it is, and at the time when—I think that the Minister, with her south-west experience, would be with me on this—greater and greater concentration of abattoir facilities inevitably leads to longer journeys. We all know, and she knows better than anyone, from the problems with the new regulations on the welfare of animals in transit—apart from the export problems with which we are all familiar—that we must staunch the wound, and stop any more smaller abattoirs closing. The centralisation of facilities is damaging in that wider sense.

Thirdly, on the charges, the Minister said: The new fresh meat regulations include a number of minor changes designed to reduce compliance costs."—[Official Report, Fifth Standing Committee on Statutory Instruments, &c., 4 April 1995; c. 7–23.] If that is true, either they have not worked or other increases in the cost regime have outbalanced that. As the hon. Members for Macclesfield and for Knowsley, South said, in some cases, the overall cost increases are dramatic. I suspect that, at the core of this, is again the fact that Britain has insisted on using expensive, skilled but utterly inappropriate methods for the purpose of inspection. The official veterinary service is not the right organisation to be employed on such an exercise. I hope that the Minister will tell us what is happening in the other 14 states. Are comparable professionals, at comparable cost, being used?

I was not there but I understand that the Minister of Agriculture, Fisheries and Food spoke at the Conservative party's Blackpool conference and that the emphasis of his speech was that he was declaring war on expensive red tape in his Department. Some might say, "16 years too late", but never mindx2014;that is good. I want to know whether this particular example of expensive Ministry of Agriculture, Fisheries and Food gold plating of what was given to us by agreement with the European Union has resulted in excessively burdensome costs on all parts of the industry, as the hon. Member for Macclesfield has said. Surely, if there is a war on red tape, this is a good place to open the first front.

11.46 am

Mr. Nicholas Baker (North Dorset)

I welcome the debate. The hon. Member for Knowsley, South (Mr. O'Hara) was wrong on costs. He ignored the need for standards and much of the debate has ignored the fact that British people require standards, to which my hon. Friend for Macclesfield (Mr. Winterton) referred, because of the way in which they have been frightened about meat eating. Clearly, the way in which the Meat Hygiene Service is working in practice in his constituency is different from the way that it is working in mine, and I am sorry to hear that. Some of his predictions were imaginative, speculative and—I hope and believe—wrong.

The figures that I have are that the total cost of providing the inspection service in 1995–96 is expected to be just over £35 million, compared with the previous local authority arrangements, which cost £45 million. That is a greater saving than was promised to us in the first place. Of course, I should like that cost to come down, but it is an improvement on what we had before.

Given that my experience of the MHS is different from that of my hon. Friend, I asked the National Farmers Union in my constituency what its experience is. It tells me that the work relationship between the MHS and NFU members and abattoir owners is generally good. It is impressed by the openness with which the MHS operates. There have been relatively few complaints from owners of abattoirs. I will discuss an abattoir in my constituency later, so I am familiar with that side of things.

In most of the debate so far, hon. Members have ignored the fact that the previous arrangements involving local authority inspections were severely unsatisfactory. They not only cost the business community overall a lot, but provided uneven and different standards in different parts of the country. Different arrangements prevailed.

Like other hon. Members, I regret today's climate. Like the Irishman, I should like to start my way to Dublin from somewhere else. Nevertheless, we must recognise that the old system of regulating and inspecting meat provision was unsatisfactory, unfair and did not produce results with which the consumer would ultimately be satisfied.

Mr. Christopher Gill (Ludlow)

Will my hon. Friend expand on his last statement, that the old system was unsatisfactory? It is easy to make such comments, but in that instance, he needs to provide some proof or evidence that the old system resulted in an unsatisfactory product.

Mr. Baker

I recognise my hon. Friend's expertise and I have no doubt that his direct experience is different from ours in the south-west, but it is the considered view of the National Farmers Union in my part of the country that the standards that were applied were different and that different abattoirs had to conform to widely differing standards—a practice to which, understandably, they objected strongly.

The Sturminster Newton abattoir in my constituency, with which my hon. Friend the Minister has been closely involved, provides an excellent service to the farming community and to the meat and butchering trade, and it has been affected by the regulations. They are a considerable hurdle for business to overcome. I must record my gratitude, and the Burden family's gratitude, to the Minister for the way in which she has handled the case. In the special circumstances, she felt it right to give a further derogation from those regulations to enable that business to renew itself.

Like me, the Burden family do not like regulations, but they recognise that today they must provide a first-class service. They want to achieve the best standards possible and, in so doing, do not want to pay more than necessary. They are undertaking a major fund-raising exercise to build a new abattoir. They want to take their business into the next century, and they want to export meat. They want to achieve the oval stamp.

There is a great market for the Burden family's beef, and for other meat, in the third world. That market will not be available unless the meat achieves the highest standard and the family need time to ensure that their factory meets those standards. They are grateful to have been given that time. The family recognise, albeit reluctantly, that if they want to compete, to provide a good service to the farming community and to export their product, they must achieve the highest standards.

Why are standards necessary? It is all very well for the hon. Member for North Cornwall (Mr. Tyler) to say, "Let us go to Europe and discover what other standards apply." Although that is a useful exercise, we start with the British consumer, who demands very high standards.

I agree with my hon. Friend the Member for Macclesfield that, regrettably, the British consumer has been panicked by a combination of mad professors and other people with other interests into being frightened of eating meat. Therefore, at least for the foreseeable future, we must ensure that standards, and no doubt even bureaucracy, exceed what we would like them to be ultimately. I concur with the hon. Member for Knowsley, South, who wanted self-regulation, but that is light years away. I wish that it were nearer, but it is not.

I conclude by quoting to the House an example from Dorset, which may be of interest to the hon. Member for North Cornwall, of the way in which panic and irresponsible behaviour operates on the British consumer in a way that it probably does not operate in any other country in Europe. Ten days before the end of the winter term, Dorset county council, under Liberal Democrat control, imposed a temporary ban on beef products in schools, not because new evidence had emerged—it had not—but because of scare tactics. The media were at work. One or two mad professors had made pronouncements. It was alleged that there had been lots of requests from parents for the ban. Further inquiries revealed that a total of six letters had been received.

The ban had a devastating effect on the farming community. There was, I should add, no ban in old people's homes or anywhere else, only in schools. As the Dorset Evening Echo said, that was a "knee-jerk reaction" by the Liberal Democrats, and it was very much to be regretted. The Spongiform Encephalopathy Advisory Committee continued to state throughout that time that there was no evidence of linkage.

About two weeks ago, the ban was halted and the decision was changed. I welcome that. That step was taken as a result, not of new medical or health evidence, but of pressure and of a recognition that damage had been done to the farming community. Irresponsibly, a highly damaging panic was stirred up, and that is not an isolated example of the fears that can be aroused by people who appear to believe that it is in their interests to do so. There are more mad cows in county hall in Dorset than in all the cattle herds of North Dorset. I deplore that.

I hope that my hon. Friend the Minister will tell us how she can reduce costs and bureaucracy—an aim with which I am entirely in sympathy—while maintaining across-industry standards. I was disturbed to hear suggestions earlier that standards were uneven, even under the new provisions. British meat is a first-class product. Our producers want to sell on the world markets. High standards of safety are required for public protection. I know that my hon. Friend the Minister understands that, even if others do not.

11.56 am

Mr. Ieuan Wyn Jones (Ynys Môn)

I hope that the hon. Member for North Dorset (Mr. Baker) will forgive me for not following him into his little difficulty with the Liberal Democrats. I shall turn my attention to the core subject of the debate, which was expressed well by the hon. Member for Knowsley, South (Mr. O'Hara), who has done us all a great justice by initiating the debate. It is important that the House recognises that there is considerable and widespread concern at the way in which the Meat Hygiene Service operates, the costs of that service, which are now evident, and the impact that they have not only on the abattoir industry but on the farming community generally.

I know that the Minister is aware that it is necessary that several outlets should be available to farmers. As other hon. Members have said, a vast number of small abattoirs have closed. The Minister may be able to tell us that the rate of closure is slowing, but some are still closing, to the detriment of the agriculture industry.

The Minister knows that, in sparsely populated rural areas far from a marketplace, some abattoirs have great difficulty attracting the right level of throughput from their local community throughout the year. At some times of the year—in my area, from January to April, before the lambs come on the market—they have to bring in animals from other parts of the United Kingdom, which is an increased cost. It is necessary for employment to be maintained in the abattoirs throughout the year. Abattoirs are an important source of local employment. Their difficulties have been compounded by the substantial increase in costs that has confronted them as a result of the introduction of the Meat Hygiene Service.

When I spoke to managers at the abattoir mentioned by the hon. Member for Knowsley, South—Cig Môn Cymru Ltd.—they predicted that their costs would increase by between 50 and 55 per cent. when the service commenced. In January 1995, they gave me an estimate of what they thought the cost of meat inspection and veterinary visits would be. Some people thought that they were being pessimistic and that the level of charges would be substantially lower. When the Government introduced the concept of the Meat Hygiene Service, it was on the basis that it would be cost-effective and reduce the overall burden on the industry.

In March 1995, the abattoir company came to me and said, "Our predictions were right. Our costs will go up 50 per cent. because we have been told by the Meat Hygiene Service what our costs are likely to be". I have been in regular contact with the Welsh Office, which is responsible for agriculture in Wales, about the level of charges. I have been told that there will be consultation between MHS officers and each abattoir to determine the level of cost for each abattoir and whether it can be justified.

Despite the predictions that were made in January 1995, despite the representations that I made in March 1995 and despite the Department's statement that there would be consultation, the January 1995 predictions were absolutely correct. There has been no variation in those charges, and the costs are exactly as predicted.

I subsequently made representations to the Welsh Office, and I was told that it was difficult to make a true comparison between proposed MHS charges and previous local authority charges. The Minister added in a letter to me: Owners may have changed their plants' size or operating hours; the throughput or the types of animals slaughtered may have altered. I have heard some excuses for price increases in my time, but that takes the biscuit. There had been no change in the type of animals going through the abattoir, no change in the level of throughput and no change in its plant size, but the cost still increased by 50 per cent.

By the end of 1995, even though the industry had been told that there would be consultation and an appeal procedure, and that the service would be cost-effective, charges were substantially higher than they were under the old local authority regime. I agree with the hon. Member for North Dorset (Mr. Baker) that we must have a hygiene service for meat that is of the highest possible standards. People need to be confident that the meat that they eat is safe—but the current system is destroying the industry.

The Government must find a formula that enables abattoirs to be absolutely confident that the meat is safe, yet reduces the burden and cost of bureaucracy that the type of service which the Government have introduced has placed on them. That is absolutely clear. I should like the Minister to acknowledge that the abattoirs which predicted that costs would increase have been proved right and that Ministers did not listen to them. The Government must respond to that. People at the abattoirs have asked me, "Why should we have to pay this kind of charge to the Meat Hygiene Service when there is no competition? We have a service that can charge virtually what it likes. How can we challenge that? The Minister will not listen to us, and the Government will not listen to us. Why don't they introduce a service that has an element of competition in it?"

If someone else can produce a service that is more cost-effective and competitive, it should be considered. I know that the Minister is aware of those issues, and I hope that she will take them on board.

12.3 pm

Mrs. Llin Golding (Newcastle-under-Lyme)

I congratulate my hon. Friend the Member for Knowsley, South (Mr. O'Hara) on so diligently and eloquently pursuing this further disgraceful episode in the misgovernment of our country. The Government's excuse for taking away the responsibility for meat inspection from local authorities was the desire to avoid the varying standards and costs that applied in different local authorities. The truth is that it was part of their vendetta against local government in general, no doubt brought about by the humiliation heaped upon the Tory party at every local election. As Lord Howe has apologised for getting rid of the Greater London council, so I hope the present Secretary of State for the Environment, the right hon. Member for Suffolk, Coastal (Mr. Gummer), will soon repent for the damage that he has caused the meat inspection service.

My hon. Friend the Member for Carmarthen (Mr. Williams), who has great experience in these matters, put the issue clearly when he said that any problem in obtaining uniformity in pricing and standards could have been solved simply by issuing guidelines. The solution is simple. I must tell the hon. Member for North Dorset (Mr. Baker) that there was no reason to create, without accurate and adequate consultation, a new organisation with so many drawbacks and which has aroused fears that, after short-term cushioning, charges will increase substantially, which would speed up the decline in the number of British slaughterhouses, harm jobs and lengthen travel distances for animals.

One of the main concerns expressed about the Meat Hygiene Service was its lack of accountability, and that is still the case. A great advantage of today's debate is that it gives the Minister the opportunity to cast aside some of the secrecy with which the MHS has been shrouded. Perhaps she will tell us when the agency intends to report publicly on its activities. We should appreciate information on cost-effectiveness, throughput, animal health, and enforcement against abattoir operators and meat traders. Will she tell us when we can expect more information so that we can better judge whether the MHS is providing a more efficient service?

Meat products are notoriously open to contamination and the dumping of bad meat. It is essential that effective monitoring arrangements are provided.

Mr. David Atkinson (Bournemouth, East)

The hon. Lady will be aware that the total cost of providing the service through local government was about £45 million a year, which is slightly more than the MHS proposes to spend this year. Is she aware that many local authorities subsidise their inspection service? Does she believe that it is right for council tax payers and consumers to continue to subsidise the British meat industry?

Mrs. Golding

The system we now have in place is a costly shambles over which we have no control. Prices can be increased without any consultation or recourse to anyone.

Mrs. Browning

Will the hon. Lady give way?

Mrs. Golding

No; the Minister will have time to reply, and I should like to make some progress.

Mr. Christopher Gill (Ludlow)

Will the hon. Lady give way?

Mrs. Golding

No, I will not. There is not much time, and other hon. Members have been waiting to speak.

I should like to examine some of the specific matters which have given local authority associations concern. One of the main bones of contention between local authorities and the Government when local authorities controlled meat hygiene was veterinary supervision of meat plants. The local authorities' view was that environmental health officers were cheaper and more effective than vets.

Local authorities wanted to reduce veterinary supervision, but the Government refused to allow it. However, the Government are now allowing the MHS to reduce supervision—the very thing that was refused to local authorities. Why, oh why, is that? Because the MHS has found it difficult to recruit staff, not least in hiring the appropriate veterinary surgeons to manage staff at slaughterhouses and abattoirs? Is it because the Government now understand the problem that high veterinary fees—the basic legality of which are now being studied by the European Court—caused local authorities?

Costs would be even higher if the Government had not made the savings that local authorities wanted, but were not allowed, to make. Will the Minister tell us what the annual cost of the MHS would have been if the savings had not been made, and what the cost is now?

While local authorities and MHS local officials are working together—the MHS is using local authority offices in such places as Smithfield market—local authorities are concerned that the MHS has added to the confusion over food safety enforcement and created gaps. Will the Minister tell us what arrangements the MHS has made to inform local authorities about food health issues in their areas?

Those important issues must be addressed if the public are to receive proper protection. For example, the Association of District Councils has drawn my attention to the issue of illegal slaughter by unlicensed slaughtermen on premises that are also unlicensed. As a consequence, meat is sold that may have been prepared in insanitary conditions. It has advised that: Currently the MHS and the State Veterinary Service have the exclusive power to deal with this situation; however, the MHS seems unwilling to take action on incidents which occur outside licensed premises, and the SVS does not have the staff available to respond quickly enough to tackle the problem. The earnest desire of the Association is therefore that L.A's are given comparative powers to the MHS and SVS in order that they are able to adequately protect the public health and safety. Will the Minister comment directly on that point, which has a bearing on the important subject of bovine spongiform encephalopathy? On 4 April last year, my hon. Friend the Member for Knowsley, South drew attention to the fact that it was local authorities which had pressed a reluctant Government to: enforce better procedures for beef carcass splitting in the industry. Will the Minister confirm what guidance is now issued to MHS staff about BSE matters in general and, in particular, about the enforcement of the new regulations relating to bovine spinal offal?

The Association of Metropolitan Authorities is concerned about the low profile of the MHS and the responsibility of its vets during the BSE scare last year. The AMA tells me that, from a local authority point of view, it is "very suspicious". The AMA has long held and expressed the view that vets are not the right people to be put in charge of meat hygiene. It has said: vets are best left looking at the health of animals, and they have insufficient knowledge in detecting unhealthy food. With BSE for example, they won't know once the bovine in killed whether or not the animal carcass is healthy. Similarly their expertise will not be in forming a judgement on whether or not the spinal cord has been properly removed and left healthy meat". The AMA's view is clear: When meat hygiene was left with local government, wider enforcement activity was possible. If inspection staff thought `mucky' meat was being produced from unhealthy animals, they would then call on the wider resources of the local authority to help complete their investigations. This is no longer the case. They are very serious concerns and the Minister must address them.

There is great concern in the country about BSE, animal health and animal welfare. From the local authorities' point of view, there is little evidence that the MHS is tackling those problems with the vigour that the Government would have expected from local authorities. We seek an assurance from the Government today that they will repair the damage that they have done to our country's food protection service.

12.12 pm

The Minister for Food (Mrs. Angela Browning)

I shall begin by picking up some of the points that hon. Members raised during the debate. Throughout his contribution, the hon. Member for Knowsley, South (Mr. O'Hara) worked on the assumption that the Meat Hygiene Service has cost £54 million—which was the figure that he mentioned in the Statutory Instruments Standing Committee. I am astonished that hon. Members on both sides of the House have assumed that that figure is absolutely correct. Any one of them could have tabled a written question in the past few weeks and received an answer from my office as to the exact cost of the service 10 months down the road. The hon. Gentleman's figure is quite inaccurate, as I told him in the Standing Committee. Today, I shall provide the correct figures, which prove that the basis of the hon. Gentleman's argument is flawed and that the allegations made by hon. Members on both sides of the House are totally without foundation.

I shall deal now with the points raised by hon. Members. We consult not just the Federation of Fresh Meat Wholesalers, but the Quality Meat and Livestock Alliance, British meat manufacturers and a whole range of people who represent both large and small companies. The hon. Member for Knowsley, South pointed to regulation inconsistencies between different abattoirs. The system that we operate in this country is based on the hazard analysis critical control point system. So as not to over-regulate them, plants are assessed individually and the amount of inspection required is based on things such as throughput and the need for further inspection.

That system has been welcomed not just by the meat inspection industry, but by whole areas of British industry as a minimalist approach to regulation. In other words, inspection is concentrated on those points in the process and on those premises where it is deemed necessary. We seek to reduce regulation by working in partnership with the abattoir owner. That is why some plants have more inspections than similar plants.

The hon. Gentleman then suggested that we should adopt the European proposal, but the Europeans are considering the system that the United Kingdom has pioneered in that area. Under our system, inspections are different from plant to plant, but regulation is minimal. We do not over-regulate where regulation is not needed. The system also helps plants to recognise the role that they must play to reduce the number of inspections of their premises.

The hon. Member for Knowsley, South also said that the MHS is not subject to Treasury controls. That is not the case: it is subject to both Treasury and National Audit Office controls. I point out to him and to the hon. Member for Newcastle-under-Lyme (Mrs. Golding) that the fact that we are having this debate, in which I can answer for the Meat Hygiene Service, proves that that service is directly accountable to my right hon. and learned Friend the Minister of Agriculture, Fisheries and Food and myself. Consequently, I am here today to account to the House of Commons. There could not be a more transparent line of communication between the service's operations and its accountability to this place. I think that the hon. Gentleman described it as a self-financing regulatory authority, but that is not the case. There is a clear line of direct contact, which I welcome.

Many hon. Members mentioned competition in Europe. My hon. Friend the Member for North Dorset (Mr. Baker) made a very telling point, using the example of the small abattoir at Sturminster Newton in his constituency. I have met my hon. Friend and the owner of that abattoir, and I issue an open invitation to hon. Members to meet me, with abattoir owners from their constituencies, and talk about problems in abattoirs and about the details of individual cases.

That abattoir owner came to my office and said, "We want the European health mark. We want to be able to export, because it is a £1 billion industry and we are very good at it." The demands of the marketplace, both at home and abroad, create huge opportunities for those abattoirs that aspire to those standards, that control and the health mark. The industry is asking for that. That is where the industry is heading in the next century, and I am astonished that hon. Members want to see a reduction in the controls that allow British companies to compete.

The hon. Member for North Cornwall (Mr. Tyler) referred to other member countries. Many, such as Ireland, Denmark and Holland, have centralised inspection systems. There is no evidence to suggest that the United Kingdom is disadvantaged commercially as a result.

I shall deal now with the main substance of the debate, as I should like to put the facts to the House. I am very grateful to the hon. Member for Knowsley, South. When the Statutory Instruments Standing Committee debated the regulations which transferred responsibility to the Meat Hygiene Service last April, the hon. Gentleman painted an alarming—indeed, an apocalyptic—picture of the effect that the MHS would have on the meat industry. I am sorry that he chose to pursue that theme in his remarks today because, 10 months down the road, I can provide more information.

I can confirm that accountability was made very clear from the time that the MHS was established. It will produce an annual report after the first year—it is now 10 months old—which will be placed in the Library. There is no question of any secrecy, and it is rather disappointing that the hon. Member for Newcastle-under-Lyme did not know that.

The hon. Member for Knowsley, South predicted that the industry would have to bear overhead costs averaging £20,000 per abattoir and that his constituent, Mr. Morphet, would be charged an extra £30,000. He said that the MHS would have a built-in incentive to maximise its own requirements, that it would drive small and medium operators out of the industry, that consumer choice would be restricted and that prices for livestock farmers would be reduced. The hon. Gentleman even predicted that fewer than 95 slaughterhouses would remain in business by the end of 1995. He will have heard the figure I gave twice, and I hope that the hon. Member for North Cornwall also understood the figure. I told the Committee in April that those accusations were unfounded. This morning, I shall give the House the facts.

The story of the Meat Hygiene Service is worth telling. When we set it up, Ministers gave it a target of achieving an efficiency gain of 10 per cent. in relation to estimated costs—our figure of £45 million, not that of £54 million given by the hon. Member for Knowsley, South—in 1994–95. We expected the MHS's operational costs, with the 10 per cent. efficiency gain, to amount to £40 million in 1995–96.

We also took the view that it should be possible for the MHS to achieve further efficiency gains in future years, and we concluded that it would be right to make available some financial assistance in the first year to ease the transition to the new arrangements. We therefore made available up to £3 million, for 1995–96 only, and we made it plain, in the House and in another place, that the Meat Hygiene Service would be expected to find the efficiency gains necessary to compensate for withdrawal of that transitional relief after 31 March 1996. In other words, the MHS was required to ensure that chargeable costs in 1996–97 would be less than £37 million—the amount that we expected to be charged for the industry in 1995–96, taking into account the efficiency savings and the transitional relief.

The MHS is now forecasting, just two months before the end of its first year, that its operation costs for 1995–96 will turn out to be £35.2 million pounds. I wish that hon. Members had thought to ring my office or put down a parliamentary question, because the contributions to the debate, including that by my hon. Friend the Member for Macclesfield (Mr. Winterton), have been based on the wrong assumption that the figure was almost double the actual figure. The erroneous figure was produced by the hon. Member for Knowsley, South last year and was perpetuated by him this morning.

Mr. Nicholas Winterton

The Minister is making much play of the actual costs of the MHS. My figures show that, in 1990, local authority costs for a similar service when there were 700 abattoirs and more than 100 poultry plants were £32 million, yet in 1995 the figure for the MHS, when there are only 400 abattoirs—not 700—and a static number of poultry plants, is about £37 million. Will the Minister comment on the statistic quoted by my constituent about his abattoir—

Mr. Deputy Speaker (Mr. Michael Morris)

Order. The hon. Gentleman knows that these are short debates, and one question is sufficient.

Mrs. Browning

I hope that my later points will help my hon. Friend.

The MHS is now forecasting that its operational costs for 1995–96 will be £32.5 million. That is an efficiency gain of more than 20 per cent. in the first year, despite the fact that we had charged it to make an efficiency gain of 10 per cent.

Because the European legislation prohibits subsidisation below the level of the so-called Community standard charge, and the MHS charges to many plants are coming out below that standard charge, only £2.5 million of the £3 million allocated to transitional relief will be used. So the total amount paid by the industry in 1995–96 will be some £32.7 million pounds. I appreciate the point that my hon. Friend the Member for Macclesfield made about fewer plants, but we are several years down the road and the MHS is charged with additional responsibilities. For example, it now has a very important role in animal welfare in the abattoirs.

Mr. Tyler

In the debate in Committee, the Minister said: As far as charges are concerned, we expect them to be no higher next year than they have been in the current financial year."—[Official Report, Fifth Standing Committee on Statutory Instruments, &c., 4 April 1995; c. 24.] Is she now saying the figures are 20 per cent. lower than expected?

Mrs. Browning

No, I am saying that, because of the 20 per cent. efficiency gains made by the Meat Hygiene Service, there have been considerable reductions, but they may not apply to every single plant because of the point I have just made about minimum charges. When we set up the Meat Hygiene Service, we knew that there were variations in charges. The hon. Member for Ynys Môn (Mr. Jones) gave a constituency example that is a case in point. In some areas, but not all, local authorities subsidised the charges that they levied from taxpayers' money.

That excellent result from the MHS means that some plants have had reduced costs this year compared to what they paid under local authorities. A large red meat plant that paid some £610,000 in 1994–95 will pay around £556,000 in 1995–96—a saving of £54,000. A medium pig slaughterhouse that paid £56,000 in 1994–95 will pay £39,000 in 1995–96—a saving of £16,000. A small abattoir that paid nearly £3,400 in 1994–95 will have a bill of less than £2,900 this year—a saving of just under £500.

As for Mr. Morphet, the constituent of the hon. Member for Knowsley, South, I understand that he has refused to provide the MHS with copies of his local authority invoices. It is therefore difficult to make an accurate assessment of how he has been affected by the MHS, but we believe that in his case the Meat Hygiene Service's charges are likely to be some 20 per cent. lower than he was charged by his local authority in 1994–95. If the hon. Gentleman or his constituent would like to supply me with those invoices so we can make the comparison, we would be very pleased to see them. To date, they have not been forthcoming.

There are also equally impressive savings in the poultry sector. One large plant will save around £75,000 on its 1994–95 bill of nearly £400,000 and another will save nearly £59,000 on a 1994–95 bill of more than £236,000.

We have always acknowledged the fact that, in individual cases, charges could go up under the MHS, because there was a wide disparity in charges under the local authority system. By and large, those who find themselves paying more under the MHS are those who paid well below average before. The industry in total is paying substantially less, and that is a very important point. Also, the charging policy is consistent across the country and the staffing levels on which the charges are based are being adjusted as necessary, following a thorough audit in each plant. That is the point that I made to the hon. Member for North Cornwall just now.

I hope that the House will recognise the commendable achievement of the MHS. I pay tribute to the chief executive and all his staff—especially the meat inspectors in the plants—for the energy and the commitment that they have shown in tackling their challenges. However, hon. Members will not be surprised to learn that my right hon. and learned Friend the Minister of Agriculture, Fisheries and Food and I have no intention of allowing the MHS to rest on its laurels. It has done extremely well in its first year of operation, and we shall make sure that next year's targets require the chief executive and his team to keep up that good work.

In practice, the MHS is already delivering in its first year an efficiency gain that we had expected would take more than two years to achieve. It would not be reasonable to expect another 20 per cent. from it next year, but we shall certainly keep pressure up.

Hon. Members have made comparisons between what is done now and what was done by local authorities. As the Minister responsible for dealing with BSE, I have had several meetings in the past year with my right hon. and learned Friend the Minister and members of the meat trade. We have discussed some of the problems that we have encountered in slaughterhouses, including staining and disposal of specified bovine offals and the retention of small pieces of spinal cord in the vertebral column. Those problems did not come to light under local authority inspection.

The general public and the meat industry must be reassured that we now have efficient, uniform inspection carried out throughout the country. When we find a problem, we are able to deal with it by bringing forward measures such as those which we have placed before the House in the past few months. I hope that all hon. Members recognise how important it is, especially in BSE controls, that we have that professional, uniform service so that when a problem arises we identify and deal with it quickly.

The hon. Member for Knowsley, South has had much to say in his local press in the past few days, as well as in his contribution to this debate, about non-payment. If the message from new Labour is "Do not pay your bills", we take note of that. That is a rather familiar theme and I thought that it was an old Labour message. Perhaps it has been forgotten. About 90 per cent. of the MHS customer base of 1,800 businesses—that is slaughterhouses, cutting plants and cold stores—are paying their bills. Those who are not paying are giving themselves a nice little advantage over their competitors while the legal arguments are being pursued.

In the Woodspring case, the judge made it clear in his November statement that there was no reason why payment should not be made while the matter was before the European Court of Justice. In other words, some people are working the system to their commercial advantage while others in the meat industry are working to improve our export trade and build up their businesses. Those people will not carry those who have debts and nor will the British taxpayer. I will pursue those debts through the courts rigorously. I hope that the hon. Member for Knowsley, South will consider exactly what he is supporting when he suggests that people who—

Mr. Deputy Speaker

Order. We must move on.