10 July 1998

£35bn BSE bill

COSTS incurred by the BSE crisis could reach £3.5bn by the year 2000, according to a National Audit Office report.

The NAO calculates that about £2.5bn has been spent since March 1996 when the crisis began, and a further £1bn will have to be spent over the next two years which will make the crisis the most costly ever peacetime disaster.

The report BSE: The Cost of a Crisis says that while less money is now being spent on compensating farmers for the 2.6m cattle slaughtered in the first 18 months of the scheme – storage of meat and bonemeal is likely to see costs continue to rise.

By September 1997 stocks of meat and bonemeal amounted to 257,000t and are thought to be rising at 65,000t a year, says the report .

The NAO estimates that some meat and bonemeal may remain in storage for five years because of problems in extending the UKs incineration capacity.

*Farm minister Jack Cunningham has revealed that government has devised an action plan to dispose of meat and bonemeal mountains.

Speaking at the Royal Show, Dr Cunningham said the previous government had not developed a plan to deal with the mountains of stored meat and bonemeal leaving the Labour government with a huge problem.

"We now have a plan of action and will be announcing the details of contracts to incinerate the meat and bonemeal very shortly," he said.