Cattle Compensation (England) Order 2006

My Lords, my only worry—I am sure this is a mere verbal worry—is that it appears in paragraph 6.1 that you get old-fashioned compensation only if it has already been calculated before 1 February, whereas the clear intention expressed in the ministry’s own memorandum is that you will get old-fashioned compensation if you were identified as a reactor by 1 February. I would be grateful if the noble Lord would assure us that what is said in the Explanatory Memorandum is what will happen and that any animal which proved positive prior to 1 February will get old-fashioned compensation. My real point is that the level of compensation fixed for dairy cows—I restrict myself only to dairy cows—is fundamentally bound to be inadequate. It is not a situation here—as the Explanatory Memorandum deals with in relation to young animals—of over-compensation in some cases and under-compensation in others—a swings and roundabouts situation. For dairy cows it will be adequate compensation in a few cases and inevitable under-compensation in all others; in other words, it will be all swings and no roundabouts. To explain the point I am making I am afraid I must ask the House to consider the life cycle of a dairy cow and to compare that with the types of cows which will go to market and, thus, which set the market price, which is the measure of compensation. Let us start at the time of a cow’s life when it has just recently calved. It will have before it a minimum of 300 days, and probably more, in which it will yield milk, which is the farmer’s main source of revenue. Thus at that period it is of maximum value to the farmer as a source of future income. After some weeks the cow will be served with a view to putting it again into calf. When that is achieved, it will still have a substantial period of yielding milk ahead of it, but it will have two added potential benefits to the farmer. First, it will produce a calf, which, if it is a heifer calf, will be of value to him and probably go into his herd in due course as a replacement. Secondly, it will have the potential to milk the next time round and remain the efficient milk producer that it is. There will, of course, come a time when the cow is dried off and ceases yielding milk, either because it is shortly to calve or because its daily yield has dropped below an economic level, it is not in calf and therefore it is to be sold. But the number of those dry cows in a herd will on average be only a small percentage of the total number—let us say 15 per cent. In contrast, except in the rare case where a farmer is giving up and having a complete dispersal sale, the only cows that will be sent to market are those which are dry. They may be sold as cows which will be calved shortly or they may be going to the food chain, but, except in rare circumstances, a farmer does not sell off a cow which is currently yielding milk and producing income. Thus, the animals which are sold in the market, and which are to be used to set the average market price, will represent only a small part, and the least valuable part, of the farmer’s herd. By way of contrast, the cows condemned to be slaughtered will be spread across the whole range of the herd. TB strikes indiscriminately and some of those found to be reactors will recently have calved, some of them will recently have got into calf. Only a few of the cows which are condemned to be slaughtered will be of the kind which go to market as dry cows to be sold. So the whole value of his herd, and the value of the cross-section of it that is being slaughtered, will be set on a scale dictated by the sale prices of the small section of his herd that is the least valuable part. There is another way of looking at the same point. A high proportion of the animals taken from a herd will be earning income as milk producers. There will be a considerable gap of time before they can be replaced, and even when they are replaced they will be replaced presumably as cows in calf, and there will be a further delay until they start producing milk. Thus, whenever a cow in milk is slaughtered, it will deprive the farmer for an appreciable time of that milk income. The compensation takes no account of that inevitable milk loss. The fundamental system of the level of compensation is set so that it is inherently too low. It could well mean the compulsory destruction of cows for compensation, which is structurally inadequate, rather than merely periodically being inadequate by means of swings and roundabouts. It is probably contrary to the Human Rights Act, which requires proper compensation. In any case, it is grossly unfair to the struggling farmer of these days. If the Minister does not feel able to withdraw the order to think the point through more carefully, I hope that at the very least he will undertake that it will be reviewed and revised when his new advisory group is established.