Elliott Review and Food Crime

Laura Sandys Excerpts

Wednesday 2nd April 2014 Westminster Hall

[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.

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[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.

[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?

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[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.

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[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.

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[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.