http://www.newswales.co.uk/?section=Agriculture&F=1&id=6191

Experts deliver foot and mouth warning

12/12/2002

A new epidemic of Foot and Mouth disease is inevitable, and it will be caused by the government's policies, Welsh Assembly members and researchers have been told.

Two experts from Cardiff University, Professor Bob Lee and Professor David Campbell said the process that will cause the next outbreak had already begun.

Their paper "Foot and Mouth - the lessons not yet learned" dismissed the government's figures for money required to prevent a recurrence as 'quite fanciful' and 'blackboard economics': "a policy adopted because it works on the blackboard but would be an object of ridicule if the costs of actually implementing it were properly evaluated."

It speaks of widespread illegal acts by MAFF, including 'horribly cruel' slaughtering which was a 'lasting national shame'. The report is also strongly critical of the behaviour of some farmers before the disaster, and in their failure to change since.

The full text of the report follows:


Are we heading for another Foot and Mouth outbreak?

David Campbell and Bob Lee, Cardiff Law School and ESRC Centre for Business
Relationships, Accountability, Sustainability and Society

The Lessons Learned inquiry, the last of three inquires the government
commissioned into the 2001 epidemic of foot and mouth disease (FMD), has now
reported. Unfortunately, the most important lesson to be learned is sadly
missing.

The epidemic was not merely badly managed by the government but was caused
by the government’s agricultural policies. FMD control is an object lesson
in regulatory failure which the government still shows little sign of being
able to address. FMD is probably the most infectious disease of livestock,
partly because it is rarely fatal.

For most animals, it is comparable to flu in humans, though often
accompanied by painful sores. Animals with the disease live to transmit it,
either by direct contact, via their wastes (in which FMD virus can survive
for weeks or months), or by exhaling the virus, which can then be wind-blown
over considerable distances.

As it is so contagious, FMD is epidemic in a sporadic fashion in most areas
of the world where livestock is reared. It took enormous post-war efforts to
bring FMD under control in Europe. Until the 2001 epidemic, the EU had been
largely free of FMD since 1990 because it operated a policy of “stamping
 out” outbreaks by the slaughter of infected and seriously at risk animals.

In most parts of the EU, but not the UK, this has been supported by
vaccination. Under the Animal Health Act 1981, MAFF (now DEFRA) has complete
responsibility for dealing with disease control. Stamping out is, of course,
only practicable as a government policy, since it requires rapid detection
and assessment followed by the rapid slaughter and disposal of all infected
and at risk animals in a way no private body could possibly undertake.

In 2001, absolutely none of the required steps were taken in time. The
Lessons Learned Report confirms that the government’s initial response to
the outbreak of the disease was hopelessly inadequate. MAFF had no reliable
monitoring in place and was slow to identify the danger. By the time it did
so, infected animals had been scattered around the country, spreading the
disease to an unknown and uncontrollable extent.

MAFF was then slow to assess the epidemiology of the outbreak and impose
measures to limit it. Political interference may well have made things worse
during this stage of the epidemic, but the basic problem was that the
disease had gone beyond MAFF’s power to compute and control it. In the end,
stamping out was abandoned in all but name. Given the unknown extent of the
disease, the slaughter became general, as animals in a radius of 3 km from
each suspected outbreak were “contiguously culled”.

In the end, up to 10 million animals were killed. Perhaps 90% of them were
not infected. The disease was eventually controlled, but only because
contiguous culling had become almost indiscriminate killing in disregard of
the economic, human and animal welfare costs. The direct economic cost is
put at up to £10 billion, but this is a remote indication of the extent of
the disaster.

There was widespread illegality as MAFF in its panic could not respect the
relevant criminal, public and private laws. In particular, it was impossible
to ensure that all the animals were killed humanely.

Very large numbers were criminally killed in ways so horribly cruel that
they should occasion lasting national shame. In the light of this
catastrophe, the Lessons Learned Report is the latest influential call for
the government to prepare better contingency plans.

With hindsight, many extra provisions for dealing with another outbreak have
been proposed: greater numbers of vets to identify the disease; more
officials to enforce precautionary measures, particularly the inspection of
overseas meat imports; bigger rendering plants; greater vaccine stocks; and
so on. The costs of controlling a future outbreak in this way will be
enormous, indeed they appear quite fanciful.

Even more worryingly, this expenditure will be wasted. As has been realised
outside of agriculture, throwing money at problems in this way is a mistake.
The correct answer to the question: “How much public money should be
directly spent on disease control?” is not “a lot more”.

The correct answer is: “a lot less”. Controlling the risk of an epidemic is
not merely a question of expenditure on disease control, but also of the
livestock rearing practices which produce the risk. Take an illustration of
a paint manufacturing business using combustible materials. That business
inevitably runs the risk of a fire harming its factory, its employees and
the surrounding area.

This risk can never be completely eliminated, though it will be increased or
diminished depending on how the business is run. To deal with unavoidable
risks, the business will need insurance cover. The insurance premiums will
reflect the probability and potential costs of fire damage. Those costs will
reflect the risk to the surrounding are if the business is legally liable to
other parties at risk, as it normally is.

Obtaining cover at the lowest premium acts as an obvious incentive to
minimise risk by running the business well. Some risks will be taken
nonetheless, perhaps because a particularly combustible material improves
manufacturing efficiency, or being near to population concentrations saves
transport costs. The business will look to balance the profits of such
risk-taking against the costs of insurance.

The optimum level of risk will be run because of the discipline imposed by
the costs of insurance. Substituting “livestock rearer” for “paint business”
in this example, one can see how MAFF caused the 2001 epidemic. Having
complete responsibility for disease control, MAFF provided farmers with very
generous compensation and insulated them from liability for losses caused to
others, such as the tourist industry. MAFF thereby made the costs of
precaution irrelevant to the farmer.

In the language of economics, the risk which is an “internal” cost in the
factory example was made an “externality” to farmers. Farmers have little
economic incentive to themselves tackle that externalised risk. Accordingly,
they haven’t, instead putting considerable effort into criticising the
government’s efforts to control the disease. MAFF created a situation of
“moral hazard” in which livestock rearing practices are devised in disregard
the costs of disease control, because those costs are borne by others.

The result is that animals are reared extremely intensively, sanitary
measures have a low priority, and, absolutely crucially to livestock rearing
as it is now practised, there are millions of live animal movements each
year.

The stamping out policy is classic “blackboard economics”; a policy adopted
because it works on the blackboard but which would be an object of ridicule
if the costs of actually implementing it were properly evaluated. Stamping
out works if FMD can be quickly detected; if it can be quickly localised; if
infected and at risk animals can be identified, slaughtered and disposed of
quickly; and if other appropriate precautionary measures can be quickly put
in place.

This may happen in a small-scale outbreak. But as livestock rearing
proceeded on the basis that disease control was the government’s, not the
farmer’s concern, everything was put in place to turn a small-scale outbreak
into a major one.

Stamping out could be thought a sensible response to a large-scale outbreak
only because it was never properly costed for that purpose. MAFF’s
epidemiological model massively underestimated the size of the threat.
Little thought was given to the costs of actually implementing stamping out.
It was especially foolish that no thought was given to the costs it would
impose on farmers unable to move stock but ineligible for compensation, or
on the tourism industry, or on those living near pyres. Now that the call
for better contingency planning is leading to stamping out being properly
costed, the use of stamping out alone will almost certainly be abandoned.

The likeliest response is that it will instead be supplemented by
vaccination, as it is in most of the EU. Widespread use of vaccination may
improve the handling of the disease and reduce the amount of appalling
cruelty because it will probably give the government more time to think
before slaughtering. But vaccination is also very costly and cannot solve
the problems if current intensive rearing practices and the mass movement of
live animals continue.

These will always threaten to turn an outbreak into an epidemic. If those
practices are not changed, we are headed for another catastrophe even if
vaccination is adopted. And if vaccination is not adopted, stamping out is
again bound to decay into mass, cruel slaughter when the next major outbreak
occurs.

If the government told our fictional paint business that, after a fire, it
would not be liable for its own or others losses but would be compensated on
a more generous basis than it could earn through normal business, we would
hardly be surprised to see the factory burn down. It might even happen that
the owner might set fire to the factory, just as it is suspected that some
farmers infected their own animals.

This is far less important that the fact that the government’s policies all
but eliminated the incentive on farmers to take the appropriate level of
precaution. The result was that the enormous post-war public investment in
disease control produced the largest epidemic of FMD the world has seen. Had
FMD been treated as a normal business risk, to be borne by those engaged in
the business, it could have been treated as a normal business expense. There
would then have been every incentive to avoid the livestock rearing
practices that caused this catastrophe.

Though making the costs of disease control internal to the decision-making
of farmers is essential, this should not be thought of as a proposal to
replace ‘regulation’ with a ‘market’. The government will have to take the
major role in the necessary ‘reregulation’.

To do so, it will have to change its entire regulatory stance towards
agriculture, away from public subvention to encouragement of self-reliance.
The first of the commissioned inquiries to report, The Future of Farming and
Food, looked at general changes to farming. It was a serious mistake to
separate this inquiry from Lessons Learned.

Change more radical than either inquiry alone would consider is needed.
Unless farmers are made to internalise the costs of disease, including FMD
control, and devise their livestock rearing practices accordingly, there is
every likelihood that there will be another epidemic. We believe it is
inevitable. The process by which another epidemic will be caused has already
begun. Movements of live animals have started again, including the
cross-channel shipment of live lambs.

This not only raises very serious animal welfare problems but obviously
constitutes a grave risk which at present the farmer ignores. Autumn
livestock auctions are pending. These will involve millions of animal
movements, but farmers have flatly told DEFRA they will not comply with the
(anyway insufficient) proposed precaution of delays on movement. DEFRA,
entirely predictably, is backing down over these.

There has recently been a serious FMD scare created by animal movements like
the ones which started the 2001 epidemic. The animals involved were not
tagged, though DEFRA’s strategy entirely depends upon this happening.

The farmer responsible simply disregarded the precautionary measures, but
then this selfishness is just what the regulations encourage. It has not
been possible to trace this farmer, but this is hardly surprising.
Experience overwhelmingly tells us that economic regulation based on
criminal sanctions is unlikely to work, and that financial incentives are a
superior regulatory mechanism.

It is a sickening joke that whilst the animals involved in the last scare
were not tagged, the farmer DEFRA claims was responsible for the 2001
epidemic was tagged as part of his home arrest. This farmer’s rearing
practices were certainly bad, but as they were common, this is fruitless
scapegoating.

Effective criminal sanctions require an impossibly costly inspection regime
and are unnecessarily draconian compared to the simple solution of making
farmers insure against the risk of the disease.

Those who, like ourselves, eat meat in the belief that livestock will be
humanely killed must realise that, unless there is radical change, this will
not be the case. Animals which provide meat will be killed humanely.

But behind them there will inevitably be huge numbers of animals cruelly
killed in the panic, mass slaughter which has been the government’s response
to the epidemics which its agricultural policies cause.

So far, all it has done to deal with the next outbreak is pass secondary
legislation to give it powers to contiguously cull which it did not have
during the 2001 epidemic, and change the name of MAFF to DEFRA.