Professor Chris Elliott’s long-awaited final report into the integrity and authenticity of UK food supply chain, published today, makes a number of recommendations about how to ensure consumers can be fully confident about the quality of their food.
The Government said it had accepted all of them, including the establishment of a Food Crime Unit. The announcement has been broadly welcomed although analysts have warned the new approach to food crime could add new unwanted costs to the food chain.
While Prof Elliott stresses that the UK has one of the safest food systems in the world, his report highlights the lack of resources currently dedicated to tackling the growing problem of organised international food crime, highlight by the 2013 horsemeat scandal. He says there are ‘strong indications food crime is still happening in the UK.
His headline recommendation is the creation of a ‘robust, effective Food Crime Unit to protect our food industry and consumers from criminal activity’.
The unit, which it is estimated will cost £2-4 million a year to run, will sit within the Food Standards Agency, which would become the lead UK agency for food crime investigation. One of the unit’s key roles would be to support better links with food crime agencies across the EU and beyond.
In its response, the Government said the FSA has initiated setting up the Unit and it will be operational by the end of 2014.
It said it agreed with the principle of a Food Crime Unit to ‘give a focus to enforcement efforts against fraud and criminality in the food chain’ and has committed to delivering the first stage of the process. Progress will be reviewed after two years.
During the first phase the Unit will focus on building the intelligence and evidence picture of the risks and the nature of food fraud and food crime in the UK.
FSA has already started to recruit and second the relevant expertise. The Unit will be supported by a range of partners including law enforcement agencies, the National Fraud Investigation Bureau and the National Trading Standards Board.
Its work will be overseen by a Board made up of government Departments and relevant criminal enforcement agencies Prof Elliott said:
“I believe the creation of the national food crime prevention framework will ensure measures are put in place to further help protect consumers from any food fraud incidents in the future.”
It is unclear how much of the cost of setting up and running the new unit will be met by the industry.
In the preface to his report he said the unit was urgently needed to protect our food industry and consumers from criminal activity and would repay the investment in it by protecting ‘the majority of businesses who work hard to provide safe and authentic food for UK consumers’.
Prof Elliott said: “The UK has one of the safest food supply systems in the world, and all those involved should be commended for what has been achieved.
“I am pleased that the Government and the food industry have already taken some major steps forward in response to the interim report’s recommendations aimed at restoring consumer confidence and protecting hardworking honest businesses from food crime.”
He acknowledged concerns about the potential for extra costs on the food sector but insisted he had been keen to avoid this. “I have been clear that I see no need for additional regulatory burdens. I believe that the systems I am proposing will help lift some existing burdens, especially from small businesses,” he said in the report preface.
The horsemeat scandal was sparked in January 2013 when a Tesco burger was discovered to contain 29 per cent horse DNA.
After an initial focus on Tesco and ABP, the company that supplied the burger, the scandal rapidly escalated as horsemeat contamination was found across a range of products supplied by a number of well known companies across many countries.
It quickly became linked to co-ordinated criminal activity, sparking a global police investigation, which has so far delivered little in the way of prosecutions.
Professor Elliott, director of the Global Institute for Food Security at Queen’s University Belfast was asked by the Secretaries of State for Defra and the Department of Health to lead a review into the integrity and assurance of food supply networks, following last year’s horsemeat incident.
He published an interim report in December 2013.
Drivers of food crime
Consumers have become accustomed to variety and access at low cost, and at marginal profit to suppliers. These factors have increased opportunities for food crime. As the food industry places more reliance on global ingredients, there is a growing awareness of the importance and complexity of assurance in food supply networks.”
The UK food industry is very competitive and there is a constant drive to reduce costs and maximise profits. Consumers are reliant on the leadership, good intentions and good practices of those who supply food and regulate it.”
The level of food crime
Estimates of the extent of criminality and serious organised crime in food provision vary widely and the full extent of the problem in the UK is unknown.
There are strong indications that food crime is happening within the UK and the review has been presented with information about threats made by criminals to regulators inspecting food businesses, and by honest businesses trying to compete with cheats.
Prevention of food crime needs to become an industry wide culture. Businesses must recruit the right staff that have pride in their company and its products. Staff can play a key role in providing early feedback about problems, through staff suggestions and whistleblowing.
Procurement policies in some food businesses, particularly some of the larger retailers, are a matter of concern. The culture of adversarial procurement has not changed and in some cases the review has learned that it has got worse. The review cautions against procurement of goods for less than the recognised reasonable price, based on market knowledge.
The growing number of audits commissioned by retailers is not achieving the intended purpose. The auditing regime has, in some cases, become an industry in itself, because it requires food businesses to pay for their audit. As a result, there is a danger that an audit regime can be used for raising revenue, placing unnecessary costs on food businesses, particularly SMEs.
Clarity around Government responsibilities and leadership is essential. Engagement with non-governmental stakeholders has confirmed that many believe the machinery of government change in 2010 which led to the transfer of authenticity testing and policy over compositional labelling has led to confusion around responsibilities within Defra and the FSA and this played a role in the horse meat incident.
Defra Secretary Elizabeth Truss said: “We’re taking action to make sure that families can have absolute confidence in the food that they buy.
“When a shopper picks something up from a supermarket shelf it should be exactly what it says on the label, and we’ll crack down on food fraudsters trying to con British consumers.
“The action we’re taking gives more power to consumers - meaning they’ve got better labelling on food, better education about where their food comes from, and better, locally-sourced food in schools and hospitals.”
Defra outlined some of the action taken by the Government in response to the horsemeat scandal, including:
NFU President Meurig Raymond said: “We are pleased that the Government is taking the horsemeat issue seriously in a bid to ensure that consumers can have 100 per cent confidence that the meat they buy is exactly what it is supposed to be – and when they want to Back British Farming, they can.
“This scandal has underlined the importance of a short, traceable supply chain. British farmers are rightly proud of their products and NFU research shows that British people would like to buy more food produced in this country.
“It is right that action is being taken to ensure that meat labelled as British is British and has all the high standards associated with British farming.
“Although we approve of plans to set up a new system of authenticity, we await with interest on details as to how that will be implemented. We would not want added costs passed on to our farmers, who have not been implicated in any way during this scandal.
“In the meantime, we would urge consumers to look out for the Red Tractor logo to be absolutely sure of where their food comes from and of the standards it has been produced to.”
NFU Scotland President Nigel Miller said: “The whole horsemeat debacle not only confirmed the huge importance that consumers place on provenance and accurate labelling but the extent to which food is now traded across thousands of miles, passing through several hands and opening up the scope for fraud to take place.
“While a Food Crime Unit within FSA is an appropriate response, it must be supported by an appropriate level of funding and resource if it is to deliver. Intelligence and information sharing will be key and, given the European angle to the horsemeat scandal, similar commitments to tackling food crime must be taken in other European member states and further afield if we are to effectively tackle food fraud on all fronts.”
Anne McIntosh, chair of Environment Food and Rural Affairs Committee, said: “Many of Professor Elliott’s conclusions echo those made by the Environment Food and Rural Affairs Committee in its two reports on Contamination of Beef Products and Food Contamination.
“In particular, both the Committee and Professor Elliott raised concerns about the reduced capacity for testing in the UK and stressed the need for more Public Analysts to undertake such testing. The Government must set out how it intends to deliver this.
“We also welcome the creation of a Food Crime Unit which should help to deter criminals from seeking to defraud consumers. The food and drink sector plays a crucial role in all of our lives and its integrity is of the utmost importance.
“Professor Elliott has kindly agreed to give oral evidence to the Committee this autumn when we will examine his report and the Government’s response to it.”
Duncan Swift, Partner and food advisor at accountancy firm Moore Stephens, said: “Whilst we don’t know the precise extent of food fraud, our experience provides evidence that it is a huge problem in the UK and Professor Elliot’s recommendations are welcome because they will help to drive up standards and cut the risk of it occurring.
“The problem is that the traceability and assurance procedures and anti-fraud resources necessary to reassure the public carry a substantial extra cost and are seen by many in government as additional red tape.
The government will not want these costs to hit consumers so they will have to be absorbed by the food supply chain. And, with the supermarkets holding the whip hand in their relationship with suppliers, it’s the farmers and food suppliers and processors who are likely to be footing the bill.
“Food suppliers are already struggling with wafer thin profit margins, so any extra costs could trigger a wave of insolvencies. That would ultimately be bad news for consumers because it would reduce choice on the supermarket shelves and could even lead to higher prices because of less competition.
Countryside Alliance Executive chairman Barney White-Spunner said: “Consumer confidence alongside protection and support for our food producers is paramount.
“This report is good in that it seeks to ensure that consumers can make choices with confidence and protection to ensure the horsemeat scandal cannot happen again.
“The Countryside Alliance has long called for clear country of origin labelling on food containing meat to protect consumers but also to promote our hard working farmers.”
Warren Anderson, Vice President, Supply Chain, McDonald’s UK said: “We’re proud that our supply chain has been highlighted by the Elliott Review as a best-in-practice example of a short supply chain that values long-term relationships.”
Dr Judith Bryans, chief executive of Dairy UK, said: “Dairy UK welcomes Professor Elliott’s recommendations and strongly supports measures to prevent fraud in the food industry.
“As a precautionary measure, Dairy UK has been working on a series of measures and schemes that meet and exceed the expectations outlined in Professors Elliott’s recommendations.
“The dairy industry is also looking at additional opportunities to enhance collaboration with government agencies such as the FSA or the VMD.”