6 Requirements for feed hygiene
| (24454)
8554/03
COM(03) 180
| Draft Regulation laying down requirements for feed hygiene.
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| Legal base | Articles 37 and 152EC; co-decision; QMV
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| Department | Food Standards Agency
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| Basis of consideration | SEM of 30 October 2003
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| Previous Committee Report | HC 63-xxvii (2002-03), paragraph 5 (25 June 2003)
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| To be discussed in Council | No date set
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| Committee's assessment | Politically important
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| Committee's decision | Not cleared (see paragraph 6.7 below)
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Background
6.1 The wide range of Community measures for dealing with the
composition and marketing of animal feeds,[21]
include Council Directive 95/69/EC[22],
which lays down the arrangements for approving establishments
manufacturing, producing or putting into circulation various such
products. According to the Commission, recent events (including
the BSE crisis, and problems over dioxin contamination) suggest
that further steps are needed to ensure the safety of all kinds
of feed, that feed businesses operate in accordance with harmonised
hygiene requirements, and to improve traceability. It therefore
put forward in April 2003 this proposal to extend the scope of,
and update, the measures currently contained in Council Directive
95/69/EC, and to present these in a new measure which would replace
that Directive.
6.2 The main changes proposed by the Commission are
set out in paragraph 5.2 of our Report of 25 June 2003, and would
include the approval and registration of establishments (extending
the need for registration to all food businesses); making operators
of feed businesses responsible for ensuring feed safety; require
all feed business operators (excluding those involved only in
primary production) to put in place and operate a Hazard Analysis
and Critical Control Points (HACCP) System; require operators
to have financial guarantees to cover the risks to their businesses;
and allow feed business operators to import feed and feed products
only from third countries which appear on a list, drawn up in
accordance with proposals which the Commission has put forward
for a separate Regulation.[23]
6.3 In her Explanatory Memorandum of 30 May 2003,
the then Parliamentary Under-Secretary of State for Health at
the Department of Health (Ms Hazel Blears) welcomed the proposal
as introducing accountability throughout the feed chain, further
ensuring that feeds are safe, and protecting consumers of livestock
products and animal health. However, she said that the practicality
and proportionality of a number of the provisions needed to be
examined and clarified. In particular, she pointed out that the
proposed registration requirements would have a marked impact
on many thousands of farms; that the introduction of HACCP requirements
would involve setting-up costs for those businesses which do not
currently apply this system, and that this needed further examination,
bearing in mind that proposed Community measures on food
hygiene specifically exempt farms from the need to apply HACCP;
that the detailed annexes will in any case need to be checked
carefully to ensure that they are applicable to the intended range
of businesses; and that it is unlikely that all feed businesses,
including farms, could fulfil a new requirement to have financial
guarantees in place, particularly as the cost of premiums could
be unsustainable.
6.4 The Minister also enclosed with her Explanatory
Memorandum an initial Regulatory Impact Assessment. This indicated
that it was not possible at that stage to put an estimate on the
financial benefits of the proposal, and that further information
on this would be sought, subject to the inevitable uncertainties
involved in quantifying measures to protect human and animal health.
Likewise, no estimates had yet been made of the costs likely
to be incurred by the 40 additive manufacturers, the 400 compound
animal feed manufacturers, and the 150,000 farms which could be
affected to varying degrees by the different aspects of the proposal,
depending upon how far they already comply with these. In view
of this, we said in our last Report that we could at that stage
do little more than draw the present position to the attention
of the House, and await further information.
Supplementary Explanatory Memorandum of 30 October
2003
6.5 We have now received a supplementary Explanatory
Memorandum of 30 October 2003 from the present Parliamentary Under-Secretary
of State for Health (Miss Melanie Johnson), together with an updated
Regulatory Impact Assessment, which she says largely confirms
the issues identified in the earlier Assessment. She reiterates
that the main concerns are:
- the likelihood that the insurance
industry would be unwilling to provide the cover needed for producers
to have financial guarantees in place, and the need therefore
to consider (at least in the short term) some kind of collective
pool into which operators would provide funds for any incidents
which might occur;
- the need to clarify further the implications
of the application of HACCP principles to those farms which may
have to introduce them for the first time (though these are thought
unlikely to be burdensome for most feed businesses, because many
work to these standards already);
- that a requirement for farms to register may
not be proportionate, since most can be identified through their
participation in other feed assurance schemes;
- the need for the standards to be applicable to
different types of premises, such as farms, pet food manufacturers,
importers of feed materials, and manufacturers of veterinary medicines,
which might not be appropriate in all cases, suggesting that a
more focussed approach would be preferable;
- the need for a longer period than the one year
proposed by the Commission before any agreed proposal comes into
force.
6.6 The Assessment also provides discounted costs
and benefits for various options, including implementation of
the proposal as it stands; the removal of the need for financial
guarantees; the introduction of some kind of pool arrangement
in the short term, pending the development of conventional insurance;
and delayed implementation. It is clear from this that the benefits
of the different approaches are similar (ranging from £4.5
million to £6.5 million), and would be broadly comparable
to the costs (of between £9.9 and 11 million), but for the
requirement for financial guarantees. Equally, whichever approach
is adopted on the latter, the costs would rise significantly to
at least £54 million (and, in certain circumstances could
be as high as £83 million). In other words, how the issue
of financial compensation is dealt with has a crucial bearing
on the impact of the proposal.
Conclusion
6.7 We have noted the latest position, and the
fact that the Government still supports the proposal in general,
subject to the concerns outlined in paragraphs 6.5 and 6.6 above.
It is also clear that by far the most important of these is the
requirement on producers to provide financial guarantees, and
the way in which that obligation is to be met. In view of this,
we are minded to hold the document under scrutiny, and to ask
the Minister to keep us informed in good time of any significant
developments, particularly in relation to this point.
21 These include such measures as listing authorised
feed additives, and controls on contaminants. Back
22
OJ No. L.332, 30.12.95, p.15. Back
2 23 3
(23671) 10987/02; see HC 63-i (2002-03), paragraph 5 (20 November
2002) and HC 63-xxi (2002-03), paragraph 13 (14 May 2003). Back
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