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Laura Sandys (South Thanet) (Con)
It is a great pleasure to serve under your chairmanship, Dr McCrea, and it is also a great pleasure to see the Under-Secretary of State for Environment, Food and Rural Affairs, the hon. Member for Camborne and Redruth (George Eustice), whom I have not been in a debate with since his elevation to Minister with responsibility for food.
It was a great shock to the British people in 2013 to find that our food system could be so badly infiltrated by crime. It started to corrupt our food system, and horsemeat was introduced into our meat products. That was shocking, because food is not just any consumer product; the public need to trust food. We need to ensure the highest standards to secure long-term stability in the food sector as a whole. The scandal changed food habits. Immediately afterwards, £300 million was knocked off Tesco’s share price. Long supply chains are now seen as serious liabilities. I hope that the Department for Environment, Food and Rural Affairs sees the need for a much more systematic assessment and analysis of the food sector—not just the production side, but all its segments. We could have anticipated some of the problems that we faced in the horsemeat scandal, because certain conditions were present.
Guy Opperman (Hexham) (Con)
I congratulate my hon. Friend on securing this important debate. I also congratulate the team behind the Elliott review, which made helpful and important recommendations. On Tesco’s share price going down, she will be aware that local markets and butchers enjoyed a renaissance, as people—certainly in my area of Northumberland—realised that the safest, most secure and best place to buy meat was the local butcher, not the supermarket.
Laura Sandys
Absolutely. In many ways, the scandal rejuvenated the way we used to buy food in the high street from local suppliers. To be frank, while one trusts one’s local butcher, this systemic problem will face everyone in the food retailing sector if we do not start to recognise that certain characteristics are creating certain underlying problems. Food crime has risen across Europe, and we have to ensure that we protect smaller retailers from infiltration by food crime, which can come through any weak link in the system.
I come back to anticipating and predicting problems in the food system. Since 2008, there has been a 30% increase in the cost of base commodities. Over that period, one would expect some early warning signs. We may not have expected crime, but we had to expect that something would give, because food prices in shops did not rise to the same extent as commodity prices. Given that 30% increase in commodity prices, anyone looking at the marketing of food would say that profits would have to fall, prices would have to increase, or the products would have to adapt. How is a supermarket frozen cottage pie that was £1 five years ago still £1 today, after a 30% increase in base commodity prices? What is in it is probably not illegal, but it is certainly not very desirable, and there is no flash across the packaging saying that there is 30% less meat in it. That disconnect between price rises and supermarket retail prices should have created some sort of early warning signal within Government.
Guy Opperman
To take the cottage pie example, should not the message from this debate, aside from all the points about the Elliott review and security, be that we should encourage cooking in our schools, and encourage people to buy the meat from the butcher and the potato from a grocer, so that they can create a wonderful cottage pie themselves, rather than buying it in Tesco or other supermarkets? That must be the message.
Laura Sandys
Yes. It is an incredibly important message, and I am happy to accept any invitation to have a cottage pie cooked by my hon. Friend.
Mr Frank Field (Birkenhead) (Lab)
Before the hon. Lady accepts the cottage pie from the hon. Member for Hexham (Guy Opperman), she might draw attention to a point that she has made before. It is all very well if someone has a kitchen and knowledge of how to make a cottage pie, but if housing benefit rules are such that a household can have the rent paid in full but no kitchen, it can be difficult to cook a cottage pie, or anything else.
Laura Sandys
The right hon. Gentleman is absolutely right, and he is doing extremely important work on the whole issue of food poverty. In my constituency, we have certain areas where accommodation does not have cookers. Families are supplied with microwaves, which confines them to buying expensive food that is frequently not of the greatest quality. That does not allow families to be resilient, as my hon. Friend the Member for Hexham (Guy Opperman) would like everyone to be. We have to look at the overall system; that is the crucial point. We need a system-based approach and policy that understands the food system in its totality.
On the early warning signs of food crime, we have to look at where the disconnects happen. We had rising commodity prices, but food prices were rising only a little in the shops, so something had to give. Different products were substituted and food crime entered the system. I know that the Minister is concerned about food security, but I hope it is now of much greater importance to DEFRA as a whole, because trust, food integrity and access to resources are all part of the wider security nexus. I hope that food security has moved up the agenda. The National Security Council regard it as important: food security is one of its nine key priorities.
Food crime is not going away. In 2007, the Food Standards Agency recorded 49 cases of food fraud, and by 2013 there were 1,500 cases. While horsemeat has been a real problem, other forms of food crime have come to the FSA’s attention: dyes in children’s sweets, illegal and toxic vodka and dangerous health substitutes that amplify diabetes. Our system in this country is particularly vulnerable because we import a lot and have long supply chains.
Roger Williams (Brecon and Radnorshire) (LD)
I congratulate the hon. Lady on securing this debate and wish I could stay a little longer. She outlined different forms of food crime. One form that I am particularly interested in is the importing of bush meat into this country, particularly from west Africa. Given the outbreak of the Ebola virus, should the Government not make even more effort to ensure that that food does not come into the country?
Laura Sandys
I absolutely agree with my hon. Friend; that is absolutely crucial. I do not believe that we have looked at our supply chains with vulnerability in mind. We have assumed, possibly rightly, that we have a very safe food system in this country, but in certain instances we might have devolved too much policy to the manufacturers, producers and retailers. The Government need to claim some of that policy back and to consider the strategic risks that the system faces.
Returning to the analysis of the crime, Europol states that drug gangs have now moved into food fraud. There is a lot of money in the business of fake, cheap food and drink; Europol says that fake food is a major new part of the underground economy. We will therefore start to see more of this. I am sure that the Minister will assure us that DEFRA and the FSA will take the matter extremely seriously. The drugs trade appears to be less profitable than food crime, and the risks are much lower. The penalties are fines that are merely petty cash or operating costs for criminals. With authorities having downgraded their investigative capacity, criminals are even less likely to be caught. We have a fantastic food system and fantastic food quality in this country, but we are a particularly attractive and vulnerable market because of our efficient but very long supply chains. Looking at investigative powers, Holland has 111 staff dedicated to food crime, but I do not believe that this country has any, so we need to upgrade our investigative capacity.
There are important questions about our food system and our expectations of the food sector. Does DEFRA believe that our cheap food system—a business model that is designed around cheap food—is not vulnerable to food crime as food prices rise globally? Has the Minister met food companies to discuss their assessment of vulnerabilities? Have they communicated to the Minister their internal reports on the horsemeat scandal? Some say that the reports were not published because some of the findings about their ability to trace the inputs into food manufacturing were so shocking. Are supermarkets and manufacturers happy to be transparent about their supply chains and prepared to be open about the increased risks of crime? If they co-operate and we work collectively, traceability and enforcement can work together, rather than as two separate silos.
Huw Irranca-Davies (Ogmore) (Lab)
I congratulate the hon. Lady on securing this timely debate. Does she agree that an innovative suggestion from the Elliott review is that data and intelligence gathering should be done centrally within some independent body? While respecting commercial confidentiality, commercial operators should be asked to pool what they can, so that we can scan for problems. That would be a great and helpful innovation.
Laura Sandys
The hon. Gentleman is absolutely right. That is both incumbent on the food sector and in its interests, because the horsemeat scandal has led to a major erosion of trust.
I am concerned that supermarkets sometimes make the excuse that they are too large to monitor their supply chains. We must be clear that they have a responsibility; if they feel that they are too large to be responsible for their supply chain, we must ask whether they are too large to be responsible for public food and well-being. I am sure that the Minister has discussed food crime with the Minister for Policing, Criminal Justice and Victims, because the problem requires Home Office, Europol and Interpol co-operation. We must consider the matter as we would other large organised crime problems. What has been the UK’s involvement in Operation Opson, the pan-European food crime and food vulnerability operation?
The future is what matters, and the Elliott review will form a crucial part of our new armoury. What is the Minister’s response to Elliott’s first report and how will DEFRA respond to its key recommendations? In particular, what is the Minister’s response to Elliott’s recommendation to set up a food crime unit within the FSA? The Dutch have 111 staff dedicated to food crime. I hope that such a unit would be properly resourced and would have the capacity to enforce and investigate. President Eisenhower said that the uninspected quickly deteriorates, so we need a new sense of ambition in this area.
In conclusion, I hope that we are not living in the past. Before 2008, food was cheap, but the world has changed, and will change even further as food prices are expected to rise year on year. The business model wrapped around cheap food is creaking. Now that drug dealers are starting to move into our food system, I hope that the Minister will recognise that business as usual is not good enough for our food producers and consumers.
Kerry McCarthy (Bristol East) (Lab)
It is a pleasure to serve under your chairmanship, Dr McCrea. I congratulate the hon. Member for South Thanet (Laura Sandys) on securing this important debate. She has been interested in the topic for some time and we have both taken part in several debates on it.
I want to add my voice to those who have welcomed Professor Elliott’s interim report on the integrity of food supply networks and his recommendations for stemming the growing tide of food crime. As we have heard, criminal networks increasingly see the potential for what Professor Elliott describes as
“huge profits and low risks”
in the food industry. The hon. Lady said that it was now more profitable and considerably less risky to be involved in food fraud than in the drugs trade. The National Audit Office reports that cases of food fraud reported by local authorities have increased by two thirds since 2010. Results published by a number of local authorities, including West Yorkshire, Leicester and West Sussex, from a survey of meat products on sale in their areas, show that gross contamination of meat is widespread. Leicester trading standards, for example, found that half of the meat products it sampled contained species of animals not identified on the label, which is in breach of legal requirements for composition and labelling. Some of it was probably deliberate fraud and some was probably cross-contamination due to poor hygiene, but it is an obvious matter of concern.
Huw Watkins, who heads the intelligence hub at the Intellectual Property Office, has documented shocking cases of adulterated goods seized in the UK in recent months, ranging from a 40-foot lorry containing over 17,000 litres of fake vodka to cases of goat’s milk adulterated with cow’s milk, which could be fatal to allergy sufferers. I was struck by Professor Elliott’s account of a meat product supplier, who had been asked by a retailer to produce a gourmet burger for a unit price of under 30p. Even using the cheapest available beef from older cows, the lowest possible unit price for the burger that the supplier could produce was 59p. Professor Elliott concluded that the only way to meet the demands of the retailer would be to switch to beef supplied from premises that were not EU approved. That black-market meat would then be ground with cheap offal, such as heart and brain, and the incorporation of meat emulsion, also known as pink slime or soylent pink, and mechanically separated or recovered meat. The product would then have been marketed as a gourmet burger, targeting the top end of the market at a higher price and at a huge profit margin for the retailer, which would be committing fraud by misrepresentation.
The example highlights a culture that Professor Elliott describes as one of casual dishonesty, which he says needs to change to one where food composition is proved, not assumed. He recommends that if retailers consistently buy below the market price, they should check there are no grounds to suspect the goods are criminal property or they risk being guilty of complicity in a crime. In other words, they should know that if they are getting something that seems too good to be true, it is too good to be true and something dodgy is going on.
In the rest of the time available, I want to concentrate on a few concerns. Answers to written parliamentary questions that I have recently tabled reveal an alarming drop in food testing over the past five years. Food composition testing is down 48%; food labelling and presentation testing is down 53.4%; microbiological analyses are down by 25.3%; and food contamination analyses are down by 24.5%. Professor Elliott has warned that cuts to food testing and inspection could put lives at risk. He has said that they could compromise the safety of the food that people eat to such an extent that “people start to die” and has called for “strong” and “well resourced” regulators.
Andy Foster, from the Trading Standards Institute, told a recent “Dispatches” programme on Channel 4:
“You take money out of sampling, you take money out of inspection, you take the money out of the consumer protection system. You will get increased levels of fraudulent activity…When you have some local authorities—like some in London—operating on one trading standards officer, how on earth can they possibly deal with all their demands from fraudulent activity?”
Cuts to trading standards are expected to result in a fall in the number of officers to below 2,000, compared with 3,000 in 2009, while the number of public analyst labs, where food is tested, has dropped from 15 to 11 in the past three years.
In February, when I asked the Minister at Environment, Food and Rural Affairs questions about the shocking West Yorkshire test results, which showed that more than a third of food samples were not what they claimed to be or had been mislabelled in some way, he replied that the 30% figure was
“misleading, because the samples looked at were based on intelligence and from areas where there was greater concern in the first place.”—[Official Report, 13 February 2014; Vol. 575, c. 1004.]
I appreciate that that is a factor; it was a risk-based assessment, so areas of concern were being targeted. However, West Yorkshire’s public analyst, Dr Duncan Campbell, believes the authority’s results represent what is going on nationally. Felicity Lawrence of The Guardian, which covered the results of the survey, concluded:
“Because it was looking, West Yorkshire found problems”.
It is clear that routine sampling, as well as that based on intelligence, is vital if cheats are to be caught and food safety standards maintained. Dr Duncan Campbell explains that well:
“Go into a pub and the bottle optics behind the bar will be filled with leading brands of vodka or whisky. If trading standards never check they are what they claim to be, and the publican is having his margins squeezed, there is a huge incentive for him to refill his bottles with cheaper generic spirits from the cash and carry.
That principle holds true across the whole retail and manufacturing sector. If you don’t have routine sampling in each area, you don’t find the cheats, and there is no deterrent to protect the public.”
Mr Gregory Campbell (East Londonderry) (DUP)
Does the hon. Lady agree that with the fall in the amount of testing and sampling, and price increases affecting both production and the retail margin, 12 months from now things are likely to be worse, not better, unless the trend is reversed?
Kerry McCarthy
Yes. There is a double incentive. One is that people are perhaps more likely to do things that they think they can get away with. The other is that profits are being squeezed and there are limits on the price that people can charge for products and still manage to sell them. That is entirely true.
In his interim report, Professor Elliott called for both risk-based and random testing to protect the consumer. Will the Minister make that FSA policy? The enforcement of standards has become increasingly random as council budgets are slashed. In answers that I have received from the Under-Secretary of State for Health, the hon. Member for Battersea (Jane Ellison),about funding for food testing, the Government have insisted they have increased funding through the provision of additional funding from the FSA to local authorities. That has increased to £2.2 million for 2013-14 from £900,000 in 2010-11. That is welcome, but it does not compensate for severe cuts to local authority budgets, which have resulted, for example, in 743 job losses in trading standards at council level between 2009 and 2012. Leicester city council’s head of regulation, Roman Leszczyszyn, said that trading standards officers had been encouraged by central Government to pursue intelligence-led enforcement, rather than random sampling, to
“reduce the burden on business and remove unnecessary inspection”.
I am deeply concerned that the Government’s ideological commitment to deregulation is trumping their responsibility for food safety. As the Elliott review says, consumers should be put first—something that does not seem to be happening under the present Government.
Last week, I raised with the Minister Professor Elliott’s concerns about the potential for budget cuts to affect the integrity of our supply chains, but he replied as if my question was solely about the horsemeat scandal of last year. However, as today’s debate has highlighted, we have moved on from the fraudulent use of horsemeat in beef products to the much wider investigation of food crime and our complex food supply networks. Would the Minister like to have another go at answering my question of 27 March: does he agree with Professor Elliott that budget cutting could reach the point where the safety of the food we eat is compromised to the extent that “people start to die”, or is the Professor just overreacting?
I know that the hon. Member for South Thanet is passionate about the cause of ensuring that people eat better food and do not resort to cheap food. It is a difficult issue. People’s budgets are under pressure. It is one thing to educate them about what is in their food, and to make sure that marketing of food reflects what is in it, and that it is of good quality. However, the cost of living is still an issue. My right hon. Friend the Member for Birkenhead (Mr Field), who is no longer in his place, is mounting an inquiry into the question of how to square people’s inability to afford to pay a great deal for food with the fact that we should not be encouraging them to buy cheap food. That is quite a job. The important point is that no matter how much people pay for their food, they have a right to know what is in it. They should not be given food that is not what they think it is.
Miss Anne McIntosh (Thirsk and Malton) (Con)
It is a pleasure to serve under your chairmanship today, Dr McCrea, and to follow the hon. Member for Bristol East (Kerry McCarthy). I congratulate my hon. Friend the Member for South Thanet (Laura Sandys) on securing the debate, which is timely, as we await Professor Elliott’s final report. I welcome the Minister and the shadow spokesman, the hon. Member for Ogmore (Huw Irranca-Davies), and I thank the Minister for his well-spent time on the Select Committee for Environment, Food and Rural Affairs, and the contribution he made to its reports.
My hon. Friend the Member for South Thanet was right to focus on what is a new aspect of the area of crime we are discussing, and we should consider why there have not been any prosecutions to date. The Select Committee first reported in March 2012 on what we were told was a temporary ban on desinewed meat, which regrettably led to a loss of jobs at Newby Foods in my constituency and, I understand, at Moy Park in Northern Ireland. We concluded at the time that there was potential for adulteration and mislabelling, and the substitution of cheaper cuts of desinewed meat. It is a pity that our conclusions and the alarm bell that was rung were not responded to then.
Laura Sandys
Those early warning signs are the important issue for the Government. We need to ensure that when such things are seen to happen, they will trigger action from the FSA or DEFRA, which should work out the possible scenarios. Prices will be increasingly squeezed, and that will become more of an issue.
Miss McIntosh
As my hon. Friend has pointed out, scrutiny of the issues is split between more than one Department—the Department of Health and DEFRA in the present case. What is particularly galling is that desinewed meat is still produced from non-ruminants as Baader meat in other European member states. There should be the same rule throughout the European Union.
There have been several reports, including the Select Committee report to which the Minister contributed, as well as the Troop review, the National Audit Office review, an internal FSA review and now the Elliott review. We need definitive action now. As my hon. Friend the Member for Hexham (Guy Opperman) said, there was a remarkable short-term boost for local butchers and farm shops, and I hope that that will last.
To address the point made by the right hon. Member for Birkenhead (Mr Field), as well as by my hon. Friend the Member for South Thanet, people may eat cheaply by buying a roast and eating it in various forms during the course of the week. Frozen and processed foods, the real villains of the piece in food adulteration, are more expensive than buying fresh meat from the local butcher.
The interim Elliott review was so important because it looked at and pulled out the various conclusions of Select Committee and other earlier reports, bringing them all together and, in particular, highlighting issues such as slabs of meat in cold storage or the transporting of food over long distances, which we now know were often the cause of the problem, but had not previously been focused on. In responding, I hope that my hon. Friend the Minister will update us on where we are with labelling. In response to the Select Committee’s fifth report, on food contamination, the Government state:
“New labelling rules have just been agreed by the European Union and the Government must meet its legal obligations on implementation of these EU labelling regulations.”
That poses a particular problem for the Malton bacon factory, because what we are trying to do with one meat product, beef, perversely has implications for other products, such as pork. It would be helpful if the Minister updated us.
On the call for shorter supply chains, the complacency in the evidence that we heard in Committee was breathtaking. The supply chains were taken as read; they were not visited—not once every three months, not once every year and not even once in three years. We need reassurance from the supermarkets and the bigger food retail chains that that is now happening. Traceability and labelling go to the core of the issue: we must learn the lessons from BSE and keep our markets open. The European Union is, after all, our largest market for fresh meat, frozen food and processed food products.
The Elliott review is also important for highlighting the role of food testing, as commented on by the hon. Member for Bristol East and my hon. Friend the Member for South Thanet. The reduction in the number of food analysts and the closure of food laboratories is causing great concern throughout the farming community and in the profession.
Huw Irranca-Davies
The hon. Lady is making a good contribution. May I take her one step back? She made a point about the importance of the industry’s reputation domestically, but we also need to get things right because, with credit to the Government, work on the export market is very much predicated on the strong reputation of UK meat produce. We need to get that right, because it will drive our export market. If we get it wrong, the corollary is that we could be sacrificing some great balance-of-payments input for this country.
Miss McIntosh
The hon. Gentleman—I might dare to call him my hon. Friend—makes a powerful point. The key to everything is that there was nothing unsafe: it was fraud, adulteration and mislabelling. We may pride ourselves on the safety of food production from farm to plate. The long supply chain was the villain of the piece.
There is now more testing than ever, as the Committee has said. There had probably been a reduction in testing before, and the evidence we heard was that certain local authorities, which shall remain nameless, had not done any testing for a number of years. That is simply not on. Where retailers are testing, it is extremely important that they share the results with the Food Standards Agency and post them on their website, so that the consumer knows what is safe. We await the final report from Professor Elliott with great interest.
Laura Sandys
That is an important point about communicating with the consumer. If product has not met the required standard or there has been an infraction of trading standards, I would like to see retailers and suppliers across the board having that on their websites, telling consumers that there has been fraud or a problem.
Miss McIntosh
My hon. Friend’s point is extremely well made and I am grateful for it.
Turning to food crime and why there have been no prosecutions, the matter is about frozen and processed food more than fresh food. Questions have to be asked. Action on fraud is well led by City of London police, but in that instance—perhaps the Minister will respond—was it the correct body? We have to ask why there were no prosecutions. The Secretary of State at the time, and a previous Agriculture Minister, said that those who had perpetrated the crimes would be brought to justice and feel the full force of the law. Why therefore have there been no prosecutions? We need to bring those people to book.
My hon. Friend the Member for South Thanet mentioned the Dutch scenario, but I am taken with the Danish model—I declare an interest, because I am half Danish—of flying food squads descending on food producers, which has something to commend it. Professor Elliott may report more on that.
Leadership from the FSA is crucial, and the Select Committee asked questions about the scrutiny of food production, with the Government’s 2010 changes in particular potentially clouding the issue. I commend the acting FSA chairman, Tim Bennett, for his work in bringing stability to the area, but the fact that the vacancy has been left open for possibly more than a year raises issues. I urge the Government to speed up the process, because we need a permanent head of the FSA in place—someone who will be the front person should there be further issues, and who will implement the final conclusions of the Elliott report and the action for which the Government will undoubtedly call.
A worrying aspect is the split responsibility between the Department for Environment, Food and Rural Affairs and the Department of Health. In the Environment, Food and Rural Affairs Committee, we certainly expected to be doing the pre-appointment scrutiny, but we were bitterly disappointed to find that it fell to the Health Committee. There are questions about overall scrutiny and where responsibility for the FSA would be best placed. Greater scrutiny and transparency can only enhance its role.
I urge the Minister to report on the Department’s discussions in Brussels and to tell us about the initial reactions to the Elliott recommendations, in particular on putting consumers first; zero tolerance; where the Government think they will go on intelligence gathering; the idea of a two-tier lab service, with a national one reporting to a European one; and the other conclusions. Will the Minister also inform us where we are with the shorter supply chain? Will he reassure us that retailers are not taking the supply chain on trust and that there will be better traceability and labelling overall?
Jim Shannon (Strangford) (DUP)
It is a pleasure to contribute to the debate, and to do so under your chairmanship, Dr McCrea. I assure you that my phone is on silent and will not interfere with my contribution to the debate.
It is a pleasure to speak in the debate secured by the hon. Member for South Thanet (Laura Sandys), because this issue has caused much concern in the past, and still does. We have seen some improvement, and I am sure that the Minister will set that out in his response. The other contributors, the hon. Members for Bristol East (Kerry McCarthy) and for Thirsk and Malton (Miss McIntosh), also outlined some of the changes that have taken place. The hon. Member for South Thanet set the scene clearly for us all.
At the time of the horsemeat contamination incident, back in January 2013, I was among the first to state that we needed changes to ensure that the same thing did not happen again. Along with many other hon. Members, I was concerned that the issue had arisen at all. Apart from putting many people off buying burgers, the scandal revealed that there was no adequate policing of the food chain in the globalised market. Although we can take action on our home soil in Westminster, Northern Ireland, Scotland and Wales, there is a globalised market out there over which we have no control.
We must do better at home and ensure that the produce that comes to the United Kingdom of Great Britain and Northern Ireland is controlled. Gone are the days when a person knew the farmer who slaughtered for the butcher who sold them their meat, but I am glad that there is a re-emergence of interest in and commitment to our local butchers—not before time. We are living in times when meat from Spain, Portugal, Brazil or Argentina is as popular as good, British beef, due to the rise of the supermarkets and their long-reaching arms.
My hon. Friend the Member for East Londonderry (Mr Campbell) and I were talking before the debate, and we were saying that a housewife who has three or four children to feed and must put meat on the table faces a quandary when she goes to the supermarket. The hon. Member for Thirsk and Malton said that it is cheaper to buy a roasting joint, from which a reasonable meal can be made, and which lasts for one or two days, but if the housewife sees a £3.99 and a 99p version of a product in the supermarket, often the cheaper will win because it puts meat on the table for her family at a cheaper price. It may not be as good quality as the £3.99 product, but at the end of the day it provides a meal. No matter what we do in legislation, it is hard to affect the housewife’s choice in the supermarket, and we must be aware of that.
Unfortunately, the checks process has been diluted; that was highlighted by the scandal. It was made clear at that time that we desperately need a more effective approach to ensure that best use is made of limited resources, and to prioritise consumer interests. It is vital that the Government and every Member of the House ensure that we use the opportunity to make lasting changes. In the Minister’s response, will he tell the House how he is working with the Northern Ireland Assembly—three of us here represent Northern Ireland—and the Scottish and Welsh Administrations to ensure that what happens in England happens in the other regions and applies to everybody?
Huw Irranca-Davies
The hon. Gentleman makes a good point. He has a particular perspective on this issue because, like me, he comes from an area of devolved Administration. One of the lessons that was flagged up by the scandal and that Elliott touches on is the necessity for trans-border, transnational co-operation, not only on food standards and food safety, but at the level of political leadership. If we do only one thing, we must ensure that this works across borders, at a European level.
Jim Shannon
I thank the shadow Minister for that sensible contribution, which we can all endorse. When the Minister responds, I hope he will provide more detail about how that will work.
When I spoke in a debate on the subject last year, I used the analogy of spilt milk: we should not cry over it, but fix the jug handle to make sure it does not spill again. We have the chance to fix the handle, and we must do it. I am pleased to say that Professor Elliott is based at Queen’s university in Belfast—all good things come from Northern Ireland, as you and I know, Dr McCrea. Queen’s university has had many good things happening in the field of health—it has had world firsts and innovations in cancer research and treatment. In December, Professor Elliott published the interim findings of his wider review of the integrity and assurance of food supply networks, which was commissioned by the UK Government. It took a “consumers first”, zero-tolerance approach, to ensure that industry, the Government and enforcement agencies always put the needs of consumers above all other considerations. The review recommended that a new food crime unit be led by the Food Standards Agency, and that the agency and local authority staff develop a coherent approach across all areas of hygiene and standards. That includes improving the guidance and training of enforcement officers that is co-ordinated by the FSA and other professional bodies.
The initial findings of the Elliott review emphasise a need for local authorities and the FSA to work together more effectively, which has not happened in the past. We look forward to seeing how they can knit together better in the regions of the United Kingdom of Great Britain and Northern Ireland and, as the shadow Minister said, across Europe and globally.
The most recent research by Which? shows that about half of consumers changed their meat eating habits as a result of the horsemeat scare in 2013. Local butchers to whom I have spoken say they are getting a younger clientele, who would have shopped in the supermarket in the past but now go to town to get their meat. That is a positive sign that augurs well for the future. Many local butchers have been making the most of the new trade by diversifying into creating meals. For many busy families—those in which both partners work full time—it is handy to have a meal that can be cooked quickly and is easy to prepare and put on the table. I am not saying that it should always be cooked in the microwave. The meals that the butchers have been creating are easy for younger people to make, and they have simplified the packaging so is easier to understand. Local butchers have been making the most of the new situation, but have we done so, at a parliamentary and regional level? It is vital that we take action to ensure that consumers are confident about the food they buy. We must feed into that process with robust checks. I welcome the re-emergence of the local butcher.
In my constituency of Strangford, we have some of the foremost food producers in not only the whole of Northern Ireland, but in the UK. A couple come to mind. There is Mash Direct, whose motto is:
“From our fields to your fork”.
There is Willowbrook Foods in Killinchy, which has another factory in Newtownards. These are growth industries. The quality is five-star, and they offer a good choice of vegetables. We also have top-quality lamb, beef, pork and poultry—all produced locally and sold in supermarket chains and across the water. Most of what we produce is exported to the Republic, England, Scotland or further afield. Every day, our fishing fleet in Portavogie lands the finest fresh prawns. There is Pritchitts foods in Newtownards, which is an example of the powdered milk industry. It sources all its milk from farmers in Northern Ireland, from a catchment area of 40 to 50 miles. That top-quality powdered milk is exported all over the world—as far away as China, Asia, South America and all over Africa. Food manufacturing and produce are intertwined, and Northern Ireland leads in the field.
The Which? report stated that consumers need to be reassured that businesses’ controls are checked and that legislation is reinforced. Only 56% of those surveyed were confident that the food they buy contains exactly what is stated on the ingredients list.
Huw Irranca-Davies
The hon. Gentleman is making some extremely good points. Does he accept that one of the interesting facets of the debate is that it cannot be divorced from fair reward in all parts of the supply chain, and from measures that we took on a cross-party basis in this House, such as the Groceries Code Adjudicator? There is a race to the bottom and a relentless squeeze on prices. As Billy Bragg said, if anyone wants an example of where out-and-out, unlimited, unrestricted capitalism takes us, it is horsemeat.
Jim Shannon
Again, the hon. Gentleman makes a valuable contribution that I endorse and support. It is not right that manufacturers and producers should be squeezed over and over; it should not happen. We cannot expect farmers or producers to produce products at a negligible profit and remain in business. We then wonder why other countries are able to produce similar products and sell them here. Price matters, but so does quality.
Laura Sandys
The other issue is the disproportionate impact on poorer households and their health. We must not forget that horsemeat, although it may be included in products fraudulently, is not necessarily bad for health. We now see things infiltrating our food system that corrupt food and are bad for health.
Jim Shannon
I accept that, and thank the hon. Lady for her wise words.
Of those surveyed, 56% were confident that the food they buy contains exactly what is stated on the ingredients list, but that means that 44% were not confident. Nine in 10 people believe that businesses that manufacture food for sale in food outlets and that sell food directly to the public have to be inspected to ensure that they meet hygiene standards before they can sell food to the public. We adhere to strict controls, criteria and legislation, and the public expect that, but 91% of people would be worried if cuts to their local council meant that some food businesses would no longer be inspected. Will the Minister reassure the 91% who are worried that cuts may affect their council’s duty to inspect businesses?
It is clear to me that the onus for checking must be on officials, and it is our responsibility to put in place changes, now that the report has been launched. One suggestion made in a briefing, with which I agree completely, is that a UK-wide database, incorporating produce from Northern Ireland and all regions, is needed. That goes back to a point I made and on which the shadow Minister intervened: we need something across the whole United Kingdom of Great Britain and Northern Ireland, so that all regions are working together to produce better produce in which people can have confidence.
Which? states that there is a need for more local authority food testing, a mandatory system for collecting sampling information from local authorities in a UK database, a more strategic approach to ensure adequate sampling, and analytical capacity to deal with potential threats. If local authorities do more testing, they will need access to laboratories that have the analytical capability to deal with the increasingly sophisticated methods of food fraud. The hon. Member for South Thanet mentioned food fraud when setting the scene. Many local authorities are working with limited resources, but some are sharing their services. There may be better ways of doing that, and expertise should be extended around the country.
Local knowledge should be supplemented with more strategic sharing of services across local authorities, overseen by the FSA, including teams of enforcement officers at regional level. The Elliott report referred to regional control, direction and focus across local authority boundaries to deal with specific sector issues and more complex or high-risk food businesses, and that should be looked at. It is clear that confidence has been affected. We must use the report, when it is finalised, to re-establish that confidence and to ensure that checks are in place, so that people have confidence in the industry and that it can deliver. That is what is expected of us in the House, and that is what we must undertake to do.
Huw Irranca-Davies (Ogmore) (Lab)
It is a great pleasure, Dr McCrea, to serve under your stewardship this morning in what has been a good and wide-ranging debate. I will try not to diminish the quality of the contributions. I congratulate the hon. Member for South Thanet (Laura Sandys) not only on securing the debate, but on her introduction to it. She has been a consistent campaigner on this and related issues. Her expertise showed in how she comprehensively went through a range of issues. I will start with some of the comments that she and other colleagues made.
The hon. Lady wisely said that we should have been able to see the problem coming, not least through the disconnect between commodity prices and the retail offer. There were other things that could have been seen, not least the disappearance of horses from Ireland, Northern Ireland and Wales. They ended up in north Wales or elsewhere, but they did not emerge somewhere else. Some connectivity of intelligence would have suggested that something was happening. There were also wider European issues. The hon. Lady made the point exceptionally well that we should have been able to see the problem coming, and that is one of the big lessons in the recommendations in the Elliott report.
My hon. Friend the Member for Bristol East (Kerry McCarthy) is also a long-term campaigner on food and related issues. She raised a vital issue that was picked up in the Elliott report. There are worrying reductions in the capacity for testing, which are linked to the capacity for detection, investigation and early intervention. That is not simply about Europol, it is about what is happening down on the ground at the grass roots, in local authorities and at a co-ordinated UK level. It is worrying if that capacity is diminished, and it is not just my hon. Friend who says that—as she said, the Elliott review also says that clearly.
The hon. Member for Thirsk and Malton (Miss McIntosh), who has great expertise from her constituency background and knowledge, made some good points about the inconsistency in how some meat production is treated at EU and UK level. I strongly agree with her call for definitive action after a series of reports into food fraud and food crime, and an end to the hiatus and vacuum in the FSA chairmanship. That is critical, because if the Elliott report says nothing else about the FSA, it screams out for leadership not only within the Government and internationally, but at the heart of the matter, which includes the FSA. That leadership is needed to drive the issue forward, not least when the full report is produced. Someone—not just the Minister, but the head of the FSA—must take a steer and say how strongly the recommendations will be pushed through.
The hon. Member for Strangford (Jim Shannon) brought a different perspective to the issue, and I thank him for talking about the need for consistent application of what eventually comes out of the Elliott review regardless of national borders. That relates to the big issue of long supply chains. We cannot suddenly make them disappear. There will be long global supply chains—that is the reality we now live with, even with the approach that Tesco and Asda are taking of shortening supply chains and so on. We therefore need commensurate transnational measures to deal with supply chains and to ensure that we can give consumers confidence on not only provenance but safety. A year ago, the issue was primarily provenance; the next one may be food safety. We must ensure that good crime analysis is comprehensively pushed out transnationally. We can do a lot about that.
All hon. Members who spoke referred, in various ways, to squaring the circle of cost, and having safe, affordable, nutritious food, while also having fair reward for producers. Those matters are not unconnected. They hang together coherently, or they should. The hon. Member for South Thanet referred to her consistent theme about the need for education and awareness so that people can do a lot with good food affordably. She is right, but that must be balanced against the reality of, for example, a single parent rushing between a couple of jobs and dealing with child duties. They will look for convenience foods, so our frozen, convenience meat products must be safe, nutritious and affordable—not simply cheap, but affordable. I know that she accepts that, and getting it right is important.
The Elliott review is important, and if we look at the scale of the industry, we see why it is critical to get the matter right. It involves not just consumer confidence but jobs and industry. According to the most recent figures from the Library, the food and drinks industry is worth £188 billion. The food and drink manufacturing industry is the single largest manufacturing sector in the UK, with a turnover of £92 billion and gross value added of £24 billion, accounting for 18% of the total manufacturing sector by turnover. It employs just over 400,000 workers, which is 16% of the overall manufacturing work force in the UK.
The latest figures that I have—I admit that they go back to 2012, so I suspect that they are slightly bigger now—suggest that just in the sectors responsible for the processing, production and preservation of meat, poultry, fish, crustaceans and molluscs, as referred to by the hon. Member for Strangford, there were nearly 3,500 enterprises of various size and scale, with more than £32 billion spent, employing more than 176,000 people. We therefore need to get things right—post-horsemeat and post-Elliott review and its final recommendations—not only for consumer confidence but because if we do not, that is what is at risk. Our deserved reputation for good, safe, well provenanced food was shaken last year. We need to get it right back in kilter for the domestic market, consumers, the industry itself and our export potential.
We know that there has been an impact on consumer confidence over the past year, because although frozen meat and poultry sales grew, those of frozen and processed meat products plummeted by as much as 40% for some sellers immediately after what happened, and there has been a slow recovery since. According to Euromonitor, consumer confidence in frozen and processed meat food is still low. As hon. Members have mentioned, the situation has been a boon for butchers, farm shops and the like, but it has also caused re-engineering towards shorter supply chains by organisations such as Asda and Tesco. I recall, as everybody will, Tesco’s “We get it” advert last year, which came, not coincidentally, at the same time as the National Farmers Union conference saying, “We get it. We will change the way we operate”. However, it was not simply Tesco—that was the biggest organisation to be confronted with the problem, but others have also started re-engineering. There is work to be done, and I keep a close eye on that, but they are starting to change how they operate.
Kerry McCarthy
I am somewhat baffled about how there can be such long supply chains in the manufacture of food products and yet the price is still so low. It seems common sense that the more travel is involved, and the more countries and the more different elements, the more the price will be bumped up. I suspect that I am putting my hon. Friend on the spot, but I very much welcome the fact that supply chains are being shortened, so that we know where our food is coming from.
Huw Irranca-Davies
My hon. Friend makes a very good point, but I think we have to accept that in international food transactions, some food products do not have a UK market. There are some products created in the UK that UK consumers do not consume. For example, if we look at some of the products that are consumed in other nations from the slaughter of chickens, there is currently no UK market for them. They are exported. Conversely and curiously, many of our farmers are finding at the moment that the premium prices for Welsh lamb, pork and so on are not primarily in the UK, so the market is operating in a way that is turning some of the product flows on their heads. Although I welcome a drive towards shorter, more clearly identifiable food supply chains, there will always be an element of longer supply chains, and that is why we need to deal with the issue in both ways.
Kerry McCarthy
I want to clarify that I am not really talking about us exporting our products or importing products, but at the time of the horsemeat scandal, when we were looking, for example, at what was in lasagne, about 11 different countries seemed to be involved. Meat might have started out in Ireland, but then it went to Spain, Romania and so on. Surely lasagne can just be made in one or two countries, rather than having to be sent on a tour of Europe before it gets to us.
Huw Irranca-Davies
My hon. Friend makes a very good point—I am sorry, I did not realise that she was referring to that specific example. She is right; in fact, in some examples, as many as 20 transaction points were in the food cycle, which is astonishing. Meat was hurtling across Europe for different parts of its processing. I suspect that it went beyond Europe as well, because there was an important, interesting sideshow going on. The US had banned the slaughter of horses for meat production, but most people had accepted that all they had done was exported that to South America—and where was it going from there?
My hon. Friend is absolutely right. One welcome move from some supermarkets and retailers is that the big ones are now following the established practice among others, such as Waitrose, Morrisons and the Co-op, of not only identifying local and UK sourcing—within England, Wales, Scotland, Northern Ireland and, I have to say, Ireland as well—but being much more specific for consumers. They are saying, “We can tell you where the product comes from and how close it is to market”. That is a welcome innovation.
I turn to the evidence of growth in food fraud and food crime. As hon. Members have mentioned, when the FSA set up the food fraud database in 2007, it received less than 50 reports of food fraud, but by last year it had received more than 1,500. According to the National Audit Office, local authorities reported 1,380 cases of food fraud in 2012, which was up by two thirds since 2010.
Professor Elliott wisely makes the distinction between food fraud and food crime. There have always been elements of food fraud going on; some noticeable ones are currently pending prosecution in different parts of the UK. However, food crime goes beyond the
“few random acts by ‘rogues’”—
they have always been out there operating, unfortunately, and they need to be stamped down on—into what Professor Elliott calls
“an organised activity perpetrated by groups who knowingly set out to deceive and or injure those purchasing a food product.”
It is on a grand scale and it is worrying.
Laura Sandys
The hon. Gentleman is making a very important point. It is absolutely crucial, when looking at international organised crime, which is part of the system, that we in the UK are not seen as the easy touch, and that the message goes out from Government to ensure that we are not seen as an easy-entry proposition for those sorts of crime organisations.
Huw Irranca-Davies
The hon. Lady makes an absolutely valid point, and we should be leading on the matter. We have to do it alongside European colleagues and others, but we should be leading on it.
We understandably focused very much post-horsemeat on meat products, their provenance and so on, but Operation Opson II, the joint Interpol-Europol initiative two years ago, dealt with the seizure of potentially harmful products such as soup cubes, olive oil—a massive area of potential food crime—caviar, coffee and many other products. We need to be wise to the fact that the issue in the UK, post-horsemeat, is coloured by that, but it is a much wider issue, and whenever those involved can see the opportunity for criminality, they will try and get in there.
I turn back to the issue of horsemeat for a moment, because there are some particularly instructive points for how we can respond to Elliott and what comes out in his report. When the horsemeat crisis broke, it is undoubtedly true—I have to say this, and I have said it consistently—that there was a delay in Whitehall among Ministers. It is not just me saying that; others have, too. At the time, the Environment, Food and Rural Affairs Committee said that
“the current contamination crisis has caught the FSA and Government flat-footed and unable to respond effectively within structures designed primarily to respond to threats to human health.”
Lord Rooker, speaking only last month at a major food symposium, said:
“There was confusion in the first three or four days about who was responsible for what…There was a hiatus in the first few days. But the slowest place it went in the food industry was Whitehall. The Department of Health, DEFRA…and Number 10 blamed the FSA for the problem in the first three weeks. It’s always the issue—blame the regulator—”
in his words—
“as happened in the flooding crisis with the Environment Agency. But it is not a very good way to operate.”
Labour’s and others’ call for another look at the powers of the FSA is supported by the former chairman of the FSA, Lord Rooker, and the same concerns have been raised in the Elliott report, in Professor Pat Troop’s inquiry for the FSA, in the Environment, Food and Rural Affairs Committee report and by the National Audit Office. I say to the Minister that there is a real strength of voice saying, “Look at the governance of the food industry again, and at how it has been fragmented.” The lack of clarity about that is not the reason why we are where we are, but it is certainly a contributory factor, as is the lack of clarity between Whitehall and what is happening locally on the ground. Labour therefore welcomes the report. It must be a wake-up call for the Government—for all Governments, whoever is in government.
Twelve months after the horsemeat scandal, we see in the papers today that no prosecutions have been brought, as hon. Members have commented today. They are right—no major prosecutions have been brought, but a couple of what might be deemed peripheral cases are under way. However, it seems to me—I may be wrong—that those cases involve the small guys and fringe operators. They do need to be brought to book, but I am not seeing any follow-through at the moment. Perhaps the Minister will tell me of something more major, with serious criminality behind it.
The hon. Member for South Thanet made a point about the penalties that are available. It is interesting that currently, under the various food regulations, there are penalties such as fines of up to £20,000 under the General Food Regulations 2004, which seems a lot, and imprisonment of up to two years. If we are talking about real, serious-scale criminality, is a £20,000 fine enough? Most well organised, transnational, serious criminals—the ones that were targeted by the Serious Organised Crime Agency, as it was previously known—would laugh at that penalty. One question that comes out of the Elliott review, the horsemeat scandal and any prosecutions that might be pending is whether we need to look again at penalties in a much more serious way. Should more severe penalties be available not only in the UK, but across the EU? Is there scope, for example, for confiscation of assets and so on?
Of course, all that work goes alongside European initiatives. The European Union food fraud unit is doing good work, and it will be interesting to see whether the Minister refers to that. The need for centralisation of the horse passports system has been identified, and the Government have been considering for some time what they should do in that respect. They have always been scathing about the old equine database and have said that they see the need for a centralised database. We accept that, but is it coming forward and how does it tie in with the European approach to horse passports? There is also the option of extending country-of-origin labelling to processed meat. The second round of DNA testing of meat products will take place this spring. I hope that the Minister will respond on some of those matters in his summing-up speech.
European Commissioner Borg said in an interview last week:
“We want to ensure that the actions that we have taken have borne fruit, otherwise we will have to introduce even stricter measures”.
Does the Minister think that we are on course now? Are we responding effectively? If not, what will those stricter measures be, and what impact will they have on both burdens on the industry and consumer prices? It is in our interest to get this right and to go forward without disproportionate burdens. I welcome the EU food integrity initiative and the lead role of the UK’s Food and Environment Research Agency—one quango that, quite rightly, was not burned in the bonfire.
I want to ask the Minister about the UK’s current position not only on food safety and food provenance, but on “wholesome” food. I suspect that many hon. Members here today are not aware of what is currently going on in the European Union, but there is a debate about the definition of wholesome food and the need to ensure that we have wholesome food in the supply chain. We understand that UK Ministers are supporting a drive to weaken the framework whereby meat and food inspections for abscesses, tumours and so on—the “unwholesome” parts of a carcase—mean that they are prevented from entering the food chain. The carcases are split open and inspected, and any contaminated meat is cut out. That is under European regulation 882. Why would the Government, after the horsemeat scandal and while we are considering the Elliott report, even consider ending the requirement for official controls that ensure that food of animal origin is free of diseased, or “unwholesome” in Euro-speak, animal material?
On the interim Elliott review proposals and the questions that arise from them, I entirely agree that Elliott puts consumers first. He asks for a zero-tolerance approach. I agree about that, and I suspect that we will need to look at the range of sanctions that we have available. Should we include seizure of assets, longer sentences and suspension or exclusion from the food manufacturing sector, for example?
On intelligence gathering, Elliott talks about the need to involve stakeholders, including industry, but says that there should also be cross-border intelligence gathering. We agree. On laboratory services, as hon. Members have mentioned, Elliott raises major questions about the reductions in UK laboratory and testing capacity. On audit, we agree with Elliott’s recommendations, as we do on Government support and on leadership. We have been playing catch-up during the past year. We now need to get ahead of the game on leadership, politically as well as within food governance. On crisis management, Elliott says that when a serious incident occurs, the necessary mechanisms must be in place so that regulators and industry can deal with it, and I agree.
We need to champion the consumer and the industry and get this right. The Elliott report takes us on significantly, and I hope that the Minister will say today that he is extremely positive about the recommendations and will tell us when we are likely to see some implementation to take them forward.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (George Eustice)
As always in these debates, I have many questions to answer and not a great deal of time, but I will do my best. I begin by congratulating my hon. Friend the Member for South Thanet (Laura Sandys) on securing the debate, which has provided us with an excellent opportunity to explore the interim report on the integrity and assurance of food supply networks and for me to update colleagues on activities since the discovery of horsemeat fraud in 2013.
As my hon. Friend pointed out, the horsemeat fraud incident last year inflicted considerable damage on our food industry and undermined confidence in our food. It was damaging to the retailers and processors involved, and that should drive home to all of them the reality that they have more to lose than anyone by cutting corners or allowing the integrity of our food supply chain to be compromised.
Food fraud is completely unacceptable. It is a crime. The competitive pressures of the marketplace, to which my hon. Friend referred, are no excuse for misleading consumers and committing fraud, so lessons must be learned by all involved. The Government take the threat of food fraud very seriously and want to ensure that lessons are learned. That is why we asked Professor Elliott to look into what could be done to protect the food chain and to restore consumer confidence following the horsemeat fraud scandal.
As all hon. Members here know, Professor Elliott published his interim report in December 2013. We should note that, in it, he makes it clear that UK consumers have access to some of the safest food in the world, so it is not all bad. However, there is no room for complacency. Professor Elliott sets out what he has identified as the key features of a national food crime prevention strategy. The interim report includes no fewer than 48 recommendations, which Professor Elliott has been discussing with the industry and the Government as part of the consultation process for the preparation of his final report. The Government have also been discussing the interim report with interested parties. My hon. Friend specifically asked whether we were discussing the issue with retailers and with industry, and I can confirm that we are. Whenever I have meetings with retailers, it is one of the issues on our agenda.
There are 48 recommendations, but we can break down Professor Elliott’s report into three key themes. First, he identifies a package of measures in relation to testing and enforcement. Secondly, a big part of his report is dedicated to responsibilities in the supply chain, both on retailers and on processors. Finally, there are issues relating to the co-ordination of Government efforts, the links between Government agencies and co-ordination between Government agencies and local authorities. Professor Elliott raises important issues relating to all three areas, and we will consider carefully the supporting analysis in his final report before making a formal response.
However, there is much that we are already implementing, and I want to spend a little time highlighting what has already been done. First, the Government have increased their funding to support local authorities’ co-ordinated programme of food sampling from £1.6 million to £2.2 million in 2013-14. The Food Standards Agency and DEFRA are helping to target local authority resources through greater central co-ordination of intelligence, by providing additional support for complex investigations, by making available some of the funding for additional training and through prioritised sampling to target delivery at areas of agreed national importance.
Secondly, an intelligence hub has been established in the FSA to improve its capability to identify and prevent threats to food safety and integrity, based on the approach to intelligence used by the police. City of London police is heavily involved in that. That intelligence hub approach, which brings together local authorities, the police, the FSA and other interested parties, is a key step towards improving co-ordination, the need for which was highlighted in Professor Elliott’s interim report and which many hon. Members have referred to today. My hon. Friend the Member for South Thanet also talked about the importance of information sharing, particularly with industry. We are working with industry to tackle some of the commercial sensitivities that can act as a barrier to information sharing. The FSA is doing some work to improve its access to industry information.
Thirdly, as my hon. Friend the Member for Thirsk and Malton (Miss McIntosh) pointed out, the food fraud experienced last year was a problem at a European level, so we need action at a European level to tackle it. Despite famously being quite Eurosceptic, I am happy to tell the hon. Member for Ogmore (Huw Irranca-Davies) that we recognise the problem to be a European one, and that we need action at a European level. The new European food crime unit, which is being developed by the European Commission, will be an important part of that intelligence network. The FSA is working with the European Commission and with other member states to get the unit up and running as soon as possible.
Several hon. Members have talked about the importance of enforcement, and particularly pursuing convictions for the offences committed last year. My hon. Friend the Member for Thirsk and Malton asked why more had not been done. Action has been taken to try to secure convictions for the offences committed last year. Those investigations are taking a little longer than many people would hope, because they are quite complex and cross many national boundaries. A number of police authorities across Europe are involved: Dutch, Polish, Danish, Italian, French and our own. Because the crimes were committed on a pan-European level across borders, it is taking time to deliver those convictions.
Miss McIntosh
Is it not the case that the horse has bolted, to coin a phrase, and that those who have perpetrated the crimes will be long gone?
George Eustice
I do not accept that. Investigations are continuing at a number of sites across the UK. City of London police is co-ordinating the police forces for all the investigations. Five arrests have been made, and the announcement a couple of weeks ago by the Crown Prosecution Service of two cases being taken to court demonstrates that action is being taken to protect consumers from mislabelling and to tackle food businesses’ failure to ensure the traceability of the products that they supply.
The hon. Member for Ogmore talked about the penalties for committing food fraud crimes. The penalty for food offences can range from giving advice or a formal notice for very trivial breaches, such as if a mistake has been made on labelling, to criminal prosecutions for the most serious offences such as fraud. We should bear in mind that when it comes to fraud, it is possible to implement a prison sentence of 10 years. I think that there are sufficient penalties in our criminal law to tackle the most serious cases.
Several hon. Members have talked about the role of the industry, which is one of the key themes picked up by Professor Elliott. As I said at the outset, the food industry has the most to lose from a decline in confidence in the supply chain, and it has a responsibility to take a leading role. As of today, the industry has submitted more than 45,000 tests of beef products for horsemeat since the horsemeat scandal broke, and no new positives have been reported since the height of the incident. Retailers and processors have taken a thorough approach to testing. The tests are being carried out through the supply chain, not only by retailers but by processors, looking at the ingredients going into products in local convenience stores as well as large national retailers.
Food businesses and trade associations representing the whole food chain are also working with the FSA and Professor Elliott to consider how to make better use of audit and controls. Professor Elliott is keen to develop ways of achieving a more streamlined and effective auditing process.
Laura Sandys
I welcome the Minister’s full response. Is the Department for Environment, Food and Rural Affairs working, in its strategy section, on early warning systems when commodity prices are going up but food prices are going up only a little bit, totally disproportionately? That must be an important signal that gives Government the sense that something is not quite right.
George Eustice
I was going to come on to that point, but I will deal with it now because my hon. Friend has raised it. She highlighted passionately in her speech the fact that there has not been as much of an increase in retail food prices as there has been in commodity prices. That can be normal, because commodity prices tend to cover a small number of products, whereas there is a broader range of products in food stores. There has been a 12% rise in food prices in real terms between 2007 and 2012, with the biggest spike in 2008.
In many debates on food banks and the like—I notice that the right hon. Member for Birkenhead (Mr Field) is not here—I am told repeatedly that the price of food in the shops is going up. My hon. Friend the Member for South Thanet highlighted the frozen cottage pie that cost £1 and did not go up in price again, but food prices at the retail end have gone up by 12%, and the fact that certain individual products have stayed the same price may come down to pricing strategies and promotion, so we cannot read too much into such examples. I recognise her point, however. The FSA has reviewed its emerging risks programme, and it is working with DEFRA to identify and assess the economic drivers of food fraud so that those influencing factors are better understood and acted on.
Jim Shannon
In my contribution, I asked how DEFRA would work with Scotland, Northern Ireland and Wales to ensure that there was a co-ordinated plan. Will the Minister comment on that?
George Eustice
Again, that is something that I was going to come on to. Food enforcement is a devolved responsibility. The Elliott review was commissioned by the UK Government, but it is being followed with close interest by the devolved Administrations and we are discussing it with them.
Some hon. Members have suggested that the supply chain is too long and too complex. I should perhaps declare an interest, in that my family run a farm shop and butchery, the slogan of which is “Food yards, not food miles.” I have a clear interest in such issues. It is a valid point that small businesses and small retailers may often have far less complex supply chains, and we can learn from that. The horsemeat fraud incident demonstrated the higher vulnerability of some of the more complex supply chains, and many retailers are learning the lessons from that. One could argue that there has been an over-reliance on the paperwork involved in all the systems for traceability and following products from processor to retailer. The onus is on larger retailers to take much greater interest in where their food comes from.
I want to pick up on a few of the other points that were made. I completely agree with my hon. Friend the Member for South Thanet that we should not be seen as a soft touch. It is worth remembering that the EU-wide testing programme discovered less than 1% of products in the UK that were affected by the horsemeat scandal, compared with an average of 4% to 5% in other European countries. Although we are not complacent, we had a more robust system than did many other countries. She also highlighted the fact that there are 111 inspectors in Holland, but I point out that Holland has a slightly different approach. In our local authorities in this country, we have more than 2,700 inspectors; it is simply that they are not in a dedicated unit but sit within trading standards.
The hon. Member for Bristol East (Kerry McCarthy) mentioned adverse reports from local authorities that have done their own inspections. It is encouraging that local authorities are stepping up to the mark and carrying out such inspections. As I pointed out, there are two reasons why the figures can look misleadingly high. First, local authorities tended to investigate where there had been complaints, so we would expect them to have found more problems. Secondly, many of the problems that they found were mislabelling, foreign-language labelling or things not being in the right place. Only a small number were food adulteration.
I am afraid that I have run out of time. We welcome this debate, which has been a great opportunity to explore the issues highlighted by Professor Elliott, and we look forward to his final report.