Memorandum to the Secretary of State for DEFRA

If the new legislation is implemented as it stands and within the time-scale envisaged, large abattoirs will become less competitive and some may cease trading. Additional costs for small and medium-sized enterprises (SMEs) will be unsustainable. Probably all will close.

The effects of this on the industry and the rural economy will be disastrous. Government recognised the importance of the small and medium-sized enterprises in the meat industry and also their crucial role in the implementation of a range of government policies relating to food and the rural economy. In April 2001, the charging regime was changed from total cost recovery for the smaller plants to the more equitable Standard Charge, bringing the UK into line with the rest of the EU. The beneficial effects were soon apparent: local and direct meat marketing expanded and the importance of the SME sector has consequently increased.

The Curry and other Inquiry Reports also recognised the significance of the SME sector. The foot and mouth epidemic highlighted the need for local abattoirs, as have animal welfare issues. Many government, government agency, regional, NGO, commercial and private initiatives have already been launched to reconnect farming and livestock production with the consumer and to help sustain and revitalise the rural economy. It is generally acknowledged that SME plants play an essential part in the implementation of a number of these policies.

At risk are DEFRA's rural regeneration and regional food strategies to encourage the marketing of regional and local food, Countryside Agency projects, the Regional Development Agencies' food strategies, the Regional Food Groups, Food Links UK, many organic farms, butchers shops in market towns and villages, numerous speciality meat businesses, farm diversification into local and direct marketing, farmers markets, farm shops, ethnic meat processors, rare breeds, environmental livestock enterprises, livestock farming in remote and upland areas, farm bed and breakfasts and rural pubs. All depend on local abattoirs and cutting plants. Many of these initiatives and businesses will become unviable and all will be put at risk if these small and medium-sized businesses are forced to close as the result of excessive inspection charges and the hasty and costly implementation of blood disposal measures. The large plants will likewise suffer.

There are other likely negative impacts of the Animal By-products Regulation. We are very concerned about the practical, economic and bio-security implications of the Fallen Stock Collection Scheme. In particular, regarding the banning of on-farm burial, we urge that the national collection scheme should be Government-funded. We also urge Government to investigate biodigestion and composting as alternative disposal routes, which we understand the Regulation does not permit at present

The nation needs the diversity of its meat and livestock industry. Large, medium-sized and small enterprises - each sector is essential for many varied reasons, some listed above. We look to DEFRA to defend their interests in the imminent EU negotiations.