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Costs and responsibilities

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TWO reports relating to animal health emerged from defra last week. The first summarised the comments defra had received in response to its public consultation on badger culling (see p 94 of this issue). The second was a report from a joint industry/government working group on sharing the responsibilities and costs of exotic animal disease*. In terms of media interest, the report on badgers has stolen the limelight so far. However, the report on cost-sharing should not be upstaged and could be much more significant in the longer term.

The working group was set up in December last year. It is made up of representatives of the livestock industry and defra, with a veterinary representative in the form of the President of the bva. It was asked by the Government to consider the balance of risks and responsibilities associated with keeping farm animals in the context of both on-farm and external biosecurity controls, and to advise on how the responsibilities and costs of animal disease outbreaks should be shared. In a concise and remarkably lucid report, it makes more than 40 recommendations, as well as identifying areas where further work is needed.

The working group's starting point is that ‘the overriding objective for sharing responsibilities and costs between industry and government must be to achieve better management of animal disease risks so that the overall risks and costs are reduced’. Its main conclusion is that a joint industry and government approach is the right one — but that this must be based on a genuine partnership agreement. It recommends that a new statutory body be established to share the responsibilities and costs of animal disease, with both industry and government representation. The shared responsibility, the report makes clear, should extend to all aspects of the development and delivery of exotic animal disease control policies, including policies on how disease outbreaks are handled, so long as both government and industry can provide the necessary accountability to discharge their responsibilities effectively.

In advocating a partnership approach, the working party presumes that the primary responsibility for the health and welfare of farm animals lies individually and collectively with livestock farmers, who are better placed than others to deal with many of the risks of exotic disease spread at farm level. It therefore believes that livestock industries must play a full role in determining animal health policy for exotic diseases. At the same time, it recognises that government has an important role to play in securing the country's borders against disease incursions and bringing public resources to bear in eradicating animal disease where there is a real possibility of a serious impact on public health, the industry and the environment. It also points out that the Government has an important role in ensuring that impacts on other parties are kept to a minimum. ‘In this, protection of public health is a key consideration.’

The report highlights the responsibilities of both government and the eu in minimising disease risks through border controls, and of farmers in minimising and managing risks on-farm. Improvements in farm biosecurity should, it says, be a key feature of any new arrangements. It emphasises the importance of farm health planning as a means of improving animal health and on-farm biosecurity, arguing that health planning should be active, ‘not just a tick box exercise’. Biosecurity, it argues, ‘should be viewed not as a cost, but rather as an important tool to manage financial risk’.On the matter of how costs should be shared, the working group argues that any agreement should be based on a ‘user pays, user says’ principle, incentivise behaviour that reduces the risk of disease, and be affordable and equitable to all parties. It should be limited to the direct costs of a disease outbreak, and not aim to cover consequential losses, which, it is suggested, could perhaps be covered by encouraging the development of a private insurance market.

The working group believes that the only way of raising funds to meet the required objectives is through a compulsory levy on the industry, but says that further consideration needs to be given as to whether this should be a prospective or a retrospective levy, or possibly a combination of both. It further suggests that industry's contribution to cost-sharing should be capped. In making these recommendations, the working group points out that more work is needed on disease categorisation, to help determine responsibilities and an appropriate share of the costs for different diseases. It also points out that more work will be necessary if the system is to take proper account of all the beneficiaries of the food supply chain.

The idea of having to pay more towards the costs of exotic disease control is unlikely to prove popular among those affected. However, the move seems inevitable given what the Government has said previously and similar developments at eu level. defra has invited comments on the working party's report by the end of October. It then plans to publish a consultation document setting out its proposals on cost-sharing by the end of the year, with a view to drafting new legislation in 2007. If things go according to plan, it intends to introduce a Bill into Parliament in 2007/08.

The working party argues: ‘If the right risk management framework can be devised, there will be benefits of partnership working for both government and the livestock industries.’ That's a fairly big ‘if’ — but it nevertheless believes that the benefits are real and well worth the collective effort required to achieve them.

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