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Lord Jopling: Some of the Minister's words fill me with disquiet. I hope that he will expand on his comment that the Government are exploring the possibility of insurance. Does that mean that they are minded to move from providing compensation in such cases, leaving it to people in the industry to insure themselves? I hope to heaven that the Minister did not mean that, but it sounded suspiciously as though he was saying that the Government intend to move from the compensation approach that has been taken in foot and mouth cases and during other outbreaks for as long as most people here can remember. If they are minded to toll the industry, this is a total bombshell for the Animal Health Bill.
I listened carefully to the Minister's comments, and, if he means what I thought he did, he must come clean now and tell us what exactly is in the Government's mind.
Lord Whitty: My comments had nothing to do with the Animal Health Bill. However, the noble Lord, Lord Jopling, did not mishear me. For at least one year, I have been saying that in the long term we must examine how the risk should be shared between the industry, the Government and the taxpayer. That would not mean a precipitate move away from the compensation system, but we must consider long-term options to avoid such bills as fell on taxpayers in the past. Our measures must be compatible with the industry's interests and may take a long time to establish. We are in discussion with representatives of the industry, the insurance sector and others to establish our options. We have not decided how to act, or in what timescale to do so. That issue is not reflected in the Bill.
Lord Livsey of Talgarth: The insurance industry appears to indicate that the risk is uninsurable and that it is not prepared to go down that path. I wonder what measures the Government are taking to persuade the insurance industry that they can shell out sufficient funds. Alternatively, will the premiums for producers be so great as to be unaffordable? A can of worms is being opened on this huge issue. This is a question for another day, as we need to discuss this complete change of principle in great detail.
The Earl of Onslow: There is a jolly good case for abolishing the compensation culture. However, that cannot be done without a largely free market and an unsubsidised agriculture industry. Our agriculture industry is bound by rules, subsidised and restricted by the CAP and the Department of EFRA, or whatever it is called. It is perfectly possible to insure against the risk of foot and mouth disease, if it is considered over
five years. The incidence in one year was catastrophic; however, it can be insured against over a reasonable period.However, as long as we have a highly regulated industry, with the Government saying this and the Government saying that, we have to have compensation. With a freer market, less regulation and less of the CAP, I suspect that we could expect farmers to bear their own risks and take their own responsibility. I would welcome that, although that is not what we are talking about in the clause.
Baroness Byford: The Minister may want to come back on this issue. My noble friend Lord Jopling heard him correctly. We had spoken about the issue earlier. It is slightly ironic that the department that totally failed to cope with doing its own job in managing disease control and stopping disease coming in now wants to get rid of its responsibilities for paying out for some of its errors.
Lord Carter: The Companion says that the debate should be relevant to the Question before the House. The Question before the House concerns Amendment No. 130, which has nothing to do with insurance.
Baroness Byford: I suspect that the noble Lord is not quite right. The amendment talks about compensation.
Earl Peel: I may be able to help my noble friend. I simply asked the Minister about the Government's intention. The Minister then revealed his plan to substitute present levels of compensation with some insurance policy.
Baroness Byford: I think that the noble Lord, Lord Carter, has given me a double whammy. I was right in the first place and my noble friend was right. We are talking about compensation. If what the noble Lord, Lord Whitty, has said is correct, we are talking about the Government ending up paying less compensation in future if they can manage it. My noble friend Lord Plumb said that he used to be insured. Many farmers were, but one problem was that insurance premiums became so high that people could not afford them, so they stopped insuring. We are back to square one.
The EU working report, to which we have referred earlier today, suggests that only 80 per cent of compensation for some diseases may come from what the report calls "the public purse", in whatever form that takes. It is not acceptable to expect the buck to keep passing back to the farmers, who are currently struggling to make a minimum wage if they are lucky. My noble friend Lord Onslow said that the risk is insurable. It would be, but we have to remember that more animals are kept now than were kept in years past, there is more movement of animals and there is much more global movement. People come in and out of this country. The chances of disease being brought in and out of this country grow as more of us come to and fro. We talked about vets earlier in the day. The number of vets out in the field has not gone down. The
noble Lord, Lord Whitty, quoted that the other day. However, it has not gone up pro rata with the increase in the number of animals, so there are fewer visits to the farm. The cycle keeps going on and on.I thought that this was not a difficult amendment, but it has taken on another look. I am glad that the NFU supports it. At this stage the best thing I can do is withdraw it, but we shall return to it. I thank noble Lords for their support and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 131 not moved.]
Clause 3 [Adjusted compensation]:
On Question, Whether Clause 3 shall stand part of the Bill?
10.45 p.m.
Baroness Byford: I oppose the inclusion of Clause 3 in the Bill. Not one of the diseases listed on page 9 of the Bill is endemic in Great Britain. Great Britain is composed of islands and protected from contamination from its neighbours by a minimum of 20 miles of sea and an underground tunnel. Then again, with the number of people transiting illegally through the tunnel, I am not sure that it truly does provide such protection.
Nevertheless, infection will not seep in, and it is highly unlikely to be blown in. It will have to be brought in. Once imported, unless it is stopped in its tracks, its movement to the first and possibly subsequent points of infection or contagion will, unless the whole procedure is deliberate, be totally uncontrollable and unpreventable by the first, second and even third recipient.
In my opinion, it is highly likely that the owner or keeper of livestock will be dismayed, angry and upset about the diagnosis of an exotic disease among his charges. Indeed, I am sure that he definitely will be upset. If it is immediately clear that the infection has not been prevented by the officials charged with doing so, he might also be rude. However, that is not an adequate reason for lopping off one quarter of his compensation cheque. Depending on the numbers involved, such a deduction could cost him more than a fine at level one, two or three.
I question whether, in the circumstances of the first, second or third infection victim, the courts might not consider it cruel and unusual punishment to penalise the farmer by so adjusting his compensation.
Lord Carter: As I understand it, the Minister intends to agree with the noble Baroness to remove Clause 3 from the Bill, which would also remove Schedule 1. There is no need to spend much time persuading him to do it because he has already said that he will do it.
Baroness Byford: I am delighted to hear it. I shall offer the Floor to the Minister so that he can say it publicly. If he does not do so, I can return to the issue.
Lord Whitty: As I indicated in my opening speech, the Government have recognised the strength of feeling among some people that the clause could be counterproductive. I regret that the farming sector and the opposition parties have not recognised that it could provide an incentive to biosecurity. However, as it is rather crude, it merits further consideration in our wider assessment of compensation, valuation and so on. I shall not reopen that whole discussion now. I therefore accede to the noble Baroness's opposition to the inclusion of Clause 3 in the Bill. As Schedule 1 will consequently fall, as will the next few groups of amendments, we shall be able to move on to Clause 4 either tonight or later, as the usual channels have now decided.
Baroness Byford: I am grateful to the Minister and to the noble Lord, Lord Carter. The possibility had been suggested earlier, and I was not for one moment suggesting that the Minister might change his mind in the intervening period. I wanted at least to make a start on the clause. As I spent several hours putting together my speech on this clause, I am glad that noble Lords were able to hear a little taste of it. I thank the Minister for accepting our suggestion.
Schedule 1 [Adjusted compensation]:
[Amendments Nos. 132 to 190 not moved.]
Clause 4 [Slaughter of vaccinated animals]:
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