Examination of witnesses (Questions 70
- 86)
TUESDAY 1 FEBRUARY 2000
MR R J BANSBACK,
MR M ATTENBOROUGH,
MR A JORET
and MR M SHARP
70. In order to reduce emissions by processing
the manure you are going to have to increase energy.
(Mr Joret) Absolutely.
(Mr Sharp) Yes and you have to look for the best environmental
option there and at the moment that would appear to be using energy
to dry manure and also improve the welfare of the birds. That
is going to have much greater benefits than the very small additional
increase in CO2 emissions from this type of system.
Mr Mitchell
71. The Government is proposing offsetting reductions
in employers' national insurance contributions to offset the impact
of the climate change levy. Is this of any real benefit to employers
in pigs and poultry?
(Mr Bansback) The indicationand this has been
mentioned by the NFUis that it is potentially a burden
on the intensive pig farming sector. We are looking at another
element of climate change levy on the meat processing sector,
which has not emerged yet and I know this is not the subject of
your discussion. There, there is more likelihood of it being neutral
in that sector, but in intensive pig it is going to be a net burden
on the industry.
72. How about poultry? Is it chicken feed as
far as you are concerned?
(Mr Joret) Within the egg sector we did an analysis
of a company I actually work for and it would still be a net cost
to us. Although the reduction in national insurance should not
be ignored, because we are quite large employers of labour, and
within agriculture and horticulture, as mentioned this morning,
the same in the poultry industry, a lot of people are actually
employed in the sector. However, that assumes that we do get the
full 80 per cent rebate and our concern is what sort of targets
we would be expected to work to.
73. The MLC tells us it "... welcomes the
opportunity to be involved in the creation of general binding
rules for the pig farming sector". How responsive is the
Environment Agency to this proposal to develop alternative approaches?
(Mr Attenborough) We are in discussion with the NPA,
the NFU and indeed the Environment Agency. At the moment we are
awaiting a response from them. We have suggested, as I indicated
before, that they actually come around a number of units and gain
an idea of what is involved in indoor pig production and get a
feel of what we have suggested in our letter which is that five
hours is more typical for a study rather than five days. We are
awaiting that response.
74. Poultry producers I saw and the people I
have talked to were well aware of the environmental problems they
may cause and voluntary systems are already in force. Do any of
those voluntary systems which exist now or could be developed
achieve the objectives of the IPPC?
(Mr Joret) We believe so. The trouble here is that
a lot of improvements are expensive, are capital intensive, so
they tend only to be made either when you are building new or
when you are in for substantial replacement. The life of equipment
we would expect to get is something in the order of 15 to 20 years,
so it is not something we can keep going back to every day. If
you look at the trend over the years, the industry has continuously
moved towards more efficient systems and that is often driven
by the planning process. To get planning permission for these
units, you very often have to go through environmental assessment
and that leads you towards these things. It is moving in that
direction but one of our big fears is when IPPC applies what happens
to all these farms which are not at this point in time at best
available technique. It is not just the cost of permits, it is
also the potential cost that we have to bear at some stage when
we bring these up to the best technique.
75. And who are presumably not making enough
money, if they are making any at all, to finance the investment
which would be necessary.
(Mr Joret) Exactly so; yes.
76. That is the essence of the problem.
(Mr Joret) Yes, indeed.
77. Are there any alternatives to the climate
change levy which could bring about a reduction in use of energy
and the emission of greenhouse gases?
(Mr Attenborough) For the indoor pig sector energy
usage in itself is not one of the major elements of the cost of
pig production. Nevertheless it is an important element therein.
The opportunities there for energy reduction do need to be studied
and that is why we have actually made a suggestion in the review
which was actually done by the Environment Agency to do with IPPC
that at the same time an opportunity is looked at in terms of
carbon fuel usage, for want of a better word, to get a feel of
that and confirm that across a range of units. That would enable
a baseline to be set and therefore the opportunities for further
reduction to be considered. My colleague has talked about the
development of IPPC just at a time when the industry is hopefully
coming out of the worst crisis it has ever had. Clearly one opportunity
for energy reduction would be looking at new buildings which are
better insulated, where better control of heat loss for example
could be made, but obviously tied in with that is capital investment.
At the moment, you have heard of the losses cumulative and weekly
which the industry is serving so it is not easy for the industry
to face up to substantial investment at this moment or indeed
perhaps for 18 months to two years.
78. How about poultry? You are presumably bigger
users of energy? Are there any alternatives which you see?
(Mr Sharp) I am not sure they are a bigger user of
energy but certainly energy is used.
79. Bigger than pigs.
(Mr Sharp) The two main energy requirements are welfare
and reducing ammonia emissions. There are not really any alternatives
there, but there are certainly efficiencies which can be made
using modern technologies. For example, warm exhaust air can be
dehumidified and then used to dry manure in areas which have been
heated up by the birds and the use of efficient equipment. It
always has to be done with the main criterion in mind of bird
welfare.
80. The Egg Industry Council said it wants an
integrated approach to pollution control. Do you think the requirements
of the IPPC and the climate change levy can in fact be integrated
with each other?
(Mr Sharp) The way they can be integrated is by a
100 per cent rebate on climate change for energy use which is
used either for welfare or for reducing emissions of acid gases
like ammonia which are perhaps a greater problem than the small
reductions in CO2 which you would get.
81. How would that apply? Would that apply as
poultry farmers implement European directives or instal new cages
or whatever? What is an enriched cage, by the way?
(Mr Joret) It is a cage with a perch, a nesting area
and a scratching area.
82. Like Parker Morris standards for council
housing.
(Mr Joret) Probably so; yes.
83. Would this rebate be phased in with new
investment? Is that part of the argument?
(Mr Sharp) One would hope the rebate would be there
for existing units as well, exiting units complying with IPPC,
actually using energy for drying manure and emission reduction.
Chairman
84. We have reached time. There is one question
I just wanted to ask the egg industry. I know the answer for pigs.
It is about import substitution. We have heard about the crisis
in pigs and we know that it is all too easy for our competitors
to get their pig meat into the UK. You have given some very dramatic
figures for the losses in the egg industry of an average of 1p
an egg at present across the industry on an ongoing basis.
(Mr Joret) That is right.
85. What are the opportunities for import substitution
for eggs if those losses continue?
(Mr Joret) They are considerable. It is probably not
likely to happen to eggs you would buy from the supermarket shelf,
which is about 62 per cent of all eggs consumed. The remaining
eggs consumed go through both the catering and particularly the
processing sector, when we are moving pasteurised liquid egg about.
It is in those sectors where price is paramount in terms of the
sale and that is the area where we potentially would see the export
of our industry. There is already some import/export trade in
that area and if we become too uncompetitive clearly that will
increase, that is both with us to the rest of the EU, because
they do not necessarily apply the rules in the same way that we
do, but also in particular to third countries. It is very easy
to ship dried egg powders for example all the way round the world
and that happens already. Only about 20 per cent of the dried
egg powder we use in the UK is actually produced here, the rest
of it will be coming from places like America, India, China, very
big producers of that commodity.
86. I should have said at the beginning, it
was very remiss of me, excellent written evidence for which we
are very grateful; it has been very helpful and very thorough.
Is there anything you want to add which you have not covered either
in your written evidence or in this oral evidence session this
morning?
(Mr Bansback) Just a concluding comment that the industry
wants to take a constructive approach to this and we want in our
discussions with the industry and the Environment Agency to find
a way out of this. I hope that the severe comments we have made
on the cost and the desperately difficult times of the industry
do not take away from the fact that we want to find a satisfactory
solution which is in the interests of the environment as well
as the industry.
(Mr Sharp) We would very much concur with that view.
Chairman: On that note of consensus, I thank
you very much indeed. We are very grateful to you.
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