16 August 2018 | Online since 2003

30 January 2018

New Environment Agency charges could devastate industry, say producers

Robert Gooch, BFREPA CEO

Leaders of the United Kingdom's free range egg producers have warned that new Environment Agency charges could devastate the industry.

The Environment Agency is intending to introduce a new charging regime in April this year. It says it wants to simplify fees and recover costs in full, but Robert Gooch, chief executive of the British Free Range Egg Producers Association (BFREPA), has described proposed increases as "exorbitant."

Robert has written to the Environment Agency in response to a consultation launched on the proposed changes. In its consultation document, the agency said it had "reviewed the way we regulate and the charges we set, to help us make it as easy as possible for businesses to do the right thing. We plan to ensure our charges are more closely linked to the cost of regulation."

It said in the document, "We are committed to making sure our charges are fair and transparent, and reflect the full cost of providing our chargeable services. Most of our charges have been fixed for at least six years or more and some don’t fully reflect the costs of providing the service."

The Environment Agency said that the changes would "significantly simplify the way customers work out their charges. Our current system is complicated and done in a different way for different regimes; the new one will be the same basis for everyone," it said. They would "make sure people pay

for the regulatory service they receive and this is what will cause the most change in costs for our charge payers." The agency said the changes would reduce reliance on taxpayer funds currently needed to support regulatory work.

"We plan to ensure our charges are more closely linked to the cost of regulation," it said.

But Robert Gooch warned in his response to the consultation document that "the proposed increase in charges is exorbitant." He said, "Quoted rates of £100/hr are excessive and more cost-effective solutions can be found in the market. The time required in the calculations to complete tasks is opaque in the consultation and it is not clear that the agency has made any progress in making efficiencies in its work practices so as to keep costs down."

Robert said the BFREPA represented 500 free range and organic egg producers who together accounted for 75 per cent of the free range and organic eggs produced in the United Kingdom. But he said the typical producer was just a small family business. Many of them just exceeded the permitting threshold, he said.

"In the next few years, it would have been expected that most producers would have grown in scale to exceed 40,000 hens, but the level of charges proposed will deter this growth. It will lead to a dichotomy in the free range egg sector with the majority of farms limited to 40,000 hens on the one hand
and a small minority of intensive farms with in excess of 100,000 hens," said Robert.

He said, "In addition to impacting the growth of the free range sector as a whole through the new charges, all the country’s organic housing and over half of the housing systems used in free range production – known as flat decks or non-cage single tiers – would be non-compliant with the agency’s interpretation of the EU’s Best Available Techniques Emission levels. This means that any new shed registered after 21 February that takes a farm’s bird numbers to over 40,000 would make all the flat deck sheds on that farm non BAT compliant for an environmental permit.

"We can only assume that this is an unintended consequence of the BAT-AELs and that the EA will look at its emission factors for single tier non-cage systems and reduce it so that it is equivalent (or less than) the European BAT-AEL."

Robert said that the combination of the higher charges and the new ammonia emission factors for single tier systems would "devastate the free range egg and organic egg sectors."

The proposals have also been criticised by Duncan Priestner, chairman of the NFU poultry board. He has urged the Environment Agency to reconsider.

“Farm businesses are incredibly innovative and are often early adopters of new technology – this sharp increase in costs levelled on businesses by the Environment Agency could seriously curtail these advancements.

“Many businesses are currently suffering from a lack of certainty regarding the future environment we will work in after Brexit and many are already making cost changes to improve their efficiency and competitiveness on farm.

“These proposed changes could see many pig and poultry businesses take a step back from innovating to ensure they can deal with inflated administrative costs.

‘’In return for additional cost we are receiving nothing extra in return. This money would be far better spent invested in the business for the benefit of the environment. The proposed fee increases are inequitable and unjustified – a view that we will be conveying strongly to the Environment Agency.”

The NFU has also outlined its concerns to Farming Minister George Eustice.


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