AHDB levy proposals suggest rate increases

AHDB levy proposals suggest rate increases

Proposals for increasing the Agriculture and Horticulture Development Board’s (AHDB’s) levy rates from the start of the 2024/25 financial year have been published by the sector councils representing beef, lamb and pork.

AHDB chairman Nicholas Saphir.

Levy payers are being given the opportunity to ask questions about the proposals over the coming weeks, including during AHDB’s ‘Funding Your Future’ livestream event on 9th November 2023.

AHDB said that the purpose of increasing rates is to meet the request from levy payers to deliver more key services, including marketing and exports for the beef and lamb, dairy and pork sectors and more independent research for cereals and oilseeds. This comes at a time when AHDB’s spending power has been greatly reduced by rising costs, which have been particularly affected by the increase in inflation.

Sector councils will make a final recommendation to the AHDB board, which will put the proposals to Government Ministers and devolved administrations later this year.

Proposed levy rates for the UK meat industry are as follows:

Beef and lamb (levy rate last set in 2011)

Cattle (excluding calves)    
Producer – £4.05 to £5.06/head of cattle
Slaughterer/exporter – £1.35 to £1.69/head

Producer – £0.08 to £0.10/head of cattle 
Slaughterer/exporter – £0.08 to £0.10/head

Producer – £0.60 to £0.75/head of sheep
Slaughterer/exporter – £0.20 to £0.25/head of sheep

Pork (levy rate last set in 1996)

Pig producer – £0.85 to £1.02
Pig processor – £0.20 to £0.24

Levy payers can find out more about the details of the proposals by visiting www.ahdb.org.uk.

Sector Councils will be available to answer relevant questions via face-to-face meetings, email (info@ahdb.org.uk), social media and the Funding Your Future livestream event throughout the autumn. Further details of Funding Your Future, along a full schedule of activity, will be announced in October

Focusing on ‘doing more’

Commenting on the timing of the proposals, AHDB chair Nicholas Saphir said: “The message from levy payers through ‘Shape the Future’ was clear, that key services provided by AHDB, such as independent research, the Strategic Farm networks, activity to identify new export markets as well as domestic marketing, are seen as vital to levy payers.

“This is an unprecedented time for our industry, with inflation alone eroding the value of the levy by around 40%. There is never a perfect time for such proposals, however it must be noted that it has been at least 12 years since a levy rate was last increased.

“The Sector Councils are right to explore the option of increasing the current rates but by taking a proportionate approach that takes into account the impact of the current economic climate on farmers, producers and processors. Therefore, I do recommend that you fully support the proposed increases.”

AHDB beef and lamb sector council chair, Colin Bateman, said: “Levy payers who took part in last year’s ‘Shape the Future’ vote asked us to do more and that is what our focus is on.

“We are seeking access to grow export markets, investigating increasing the frequency of our marketing campaigns to maintain the momentum on shifting consumers’ attitudes to red meat and doubling our spend on education work championing Beef and Lamb.

“If a levy increase is supported, we can continue to address the issues that levy payers raise, and focus on bringing more value to those priority areas.”

AHDB Pork Sector Council chair, Mike Sheldon, said: “A levy increase of 21p per pig will allow AHDB to keep delivering the vital support this sector needs, whether through promoting the high integrity of British pork, pursuing export sales to underpin prices in the UK or by pushing back on mistruths around nutrition and production by balancing out the debate.

“The Pork levy rate is the same today as it was over 20 years ago, and its spending power has dramatically reduced since then. We need to act together to face huge challenges and optimise the future of the sector.”

Members expect to see a ‘good return’ on their investment

The Association of Independent Meat Suppliers (AIMS) expressed its concerns about the increases in levy rates and the value that the levy delivers to its members’ businesses. Tony Goodger, membership communications lead at AIMS, said: “For our part we have concerns that staff at AHDB have for too long seen the restriction on ‘lobbying’ as a means of not fully engaging with officials on issues that are of concern to levy payers.

“We see lobbying as a political act whereas constructive conversations for the benefit of the industry is, we believe, not lobbying.”

Goodger went on to say that AIMS, to date, had seen “no evidence from AHDB promoting the full digitisation of export process and the need for the looming veterinary attestations issue to be addressed.”

He added: “Furthermore we’d also like AHDB to express the opinions of their levy payers through responses to Government consultations.

“If we are to lend our support to any levy increase it will be on the proviso that AHDB regularly report back to levy payers and their representative trade associations, such as AIMS, on how they have been addressing industry issues with officials.”

Goodger concluded that AIMS is not opposed to the levy, but “as with any spend in any business [its] members expect to see a good return on the money they pay.”

Chair of Quality Meat Scotland (QMS) Kate Rowell said: “As the world gears up to compete for high value UK retail market access, levy bodies must also gear up to be able to deliver on behalf of businesses within their supply chains. QMS has not requested a levy increase since 2010, and we want to remain fit for the future of Scotland’s iconic Scotch brands, promotional work and market development.

“With this in mind, as we announced at the Royal Highland Show, we plan to hold industry workshops throughout Scotland during November and December, to discuss the delivery of our five-year strategy and, as agreed by the QMS board, a proposed levy increase to fund this vital work.”

Rowell said: “To continue to deliver good value for money and integral support to Scotland’s red meat supply chain, as well as to ensure that rising costs are managed, QMS will propose a new mechanism for setting the levy from Spring 2024, adding a small inflationary rise each year to ensure our financial model remains sustainable. This mechanism will be reviewed at the end of the five years, to ensure it remains fit for purpose.”

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