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Swine fever loan to be repaid next month

by 5m Editor
18 November 2003, at 12:00am

UK - The 20p Pig Industry Development Scheme levy - otherwise known as the 'top-up levy' - has now raised sufficient funds to repay the 33.8m owed to Defra, and repayment will probably be made at the end of next month.

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But the Pig Industry Development Scheme itself will be retained, even though the levy has been set to zero. This will ensure a fund-raising mechanism is in place should further pig disease issues arise.

For the sake of administrative tidiness, it is proposed to amalgamate the Pig Disease Eradication Fund (which was set up in the 1980s to eradicate Aujeszky's Disease) with the Pig Industry Development Scheme.

Since Aujeszky's was eradicated, the Pig Disease Eradication Fund's role has been to ensure the continuance of national surveillance for Aujeszky's, which is carried out by Defra, with the cost being partially offset by the residual capital of 3605,000 in the fund.

Merging the Pig Disease Eradication Fund with the Pig Industry Development Scheme will not effect this work.

The Pig Industry Development Scheme was born in March 2001 to enable the industry to make an immediate top-up payment to producers who sold pigs into the government's welfare disposal scheme during the East Anglia classical swine fever outbreak of 2000.

The industry considered the payments offered by government at the time were inadequate to alleviate the welfare of pigs and producers and help in the control of the disease.

So the Pig Industry Development Scheme borrowed money from Defra (then Maff) to allow it to make early top-up payments. It is this loan which is now about to be repaid.

To comply with state aid rules, the loan from Defra was subject to interest at two percent of the average annual balance in a repayment account held in an MLC deposit account on behalf of the scheme's board.

The board has managed the money collected from the 20p levy to ensure the maximum amount of interest has been earned. This has enabled the board to reduce the levy to zero earlier than would otherwise have been the case.

The legal role of the Pig Industry Development Scheme is to 'make provision for such facilities or services, and the giving of such financial assistance, as the MLC.

Source: National Pig Association - 18th November 2003

5m Editor