Brexit: taking back control
By Richard North - August 30, 2020
The work on The Great Deception revision/update continues – and it doesn’t get easier. I’ve now reached 2013 and, if 2012 was a complex year, this is shaping up to be even more so. It was the year Cameron gave his famous Bloomberg speech, promising us an in/out referendum, which set the nation on the path to Brexit.
When he gave his speech, on Wednesday 23 January at the London headquarters of the Bloomberg group, it was interesting to note that he complained about “excessive regulation”. This, he argued, “is not some external plague that’s been visited on our businesses”. People, he said, “resent the interference in our national life by what they see as unnecessary rules and regulation”.
Already in train, though, was another of those occasional crises which stemmed in part from such “interference”, the nature of which should have had special relevance. The previous year, Cameron had launched the “balance of competence” review, an audit of what the EU did and how it affected the UK, intended to guide the prime minister when he came to demand from the EU the repatriation of some powers.
Yet, by the time the crisis was over, few people were any the wiser as to the reasons why it had happened – including politicians, regulators and many so-called experts.
In the nature of things, when dealing with criminal enterprise, no-one can be sure when exactly the sequence leading to the “great horsemeat scandal” actually started. The adulteration of (mainly) processed beef products with cheaper horsemeat may have been, and most probably had been going on for some time. albeit on a relatively small scale.
On 15 January 2013, however, the Food Safety Authority of Ireland announced that its testing programme had detected equine DNA in 37 percent of products examined, mainly frozen beef burgers. One sample, was approximately 29 percent horse meat. Products were being supplied to Tesco and other supermarkets by Silvercrest Foods in Ireland and Dalepak, in Hambleton in Yorkshire, all subsidiaries of the Irish-based ABP Food Group.
The story remained relatively low-key until early February, by which time there had been multiple reports of adulteration involving man household brands, escalating the issue into a full-blown food scare – even though (despite attempts to show otherwise) there were no health implications.
What characterised this “scare” in the early stages was the inability of the media to recognise or understand that food safety regulation – stemming from Commission President Romano Prodi’s intervention in 1999 – was an exclusive EU competence, coupled with a profound ignorance of how the actual regulatory system worked.
Comprehension was not assisted by the intervention of Mary Creagh, for the Labour opposition, blaming the government and retailers for “rolling back regulation that protects our food”, and demanding to know why the problem had not been detected by British food authorities.
Creagh was to return to the “deregulation” charge at the Labour Party conference in September, telling delegates what she had “learned” from the horsemeat scandal. “David Cameron’s drive to deregulate the food industry”, she asserted, “coupled with his cost of living crisis created the perfect conditions for the horsemeat scandal”.
Warming to her theme, she declared: “Deregulation, fewer trading standards officers and the end of food sampling meant it was open season. Horse meat was dripped into our food for 2 or 3 years by criminals who knew their chances of getting caught here were small. Deregulation gave us horse meat in our burgers”. Thus, she proclaimed: “I think it’s time we had a bit more regulation of our food”.
Back in February, some of the horsemeat had been traced to abattoirs in Romania. But there, it had been correctly labelled before being sent to a Cyprus-registered company, Draap Trading Ltd, a company run from the Antwerp area of Belgium, and owned by an offshore vehicle based in the British Virgin Islands, with a Dutch director.
The meat was then delivered to the French company Spanghero. In turn, it had supplied other French companies, and a firm called Comigel with a processing factory in Luxembourg. Some minor players were also picked up.
Those responsible for selling adulterated meat to the APB group were never found. Through DNA testing, the source was tracked to Poland.
A partial explanation as to why the trail was so hard to follow was provided later, describing how a batch of beef adulterated with horsemeat had “criss-crossed international frontiers and passed through the border areas of Northern Ireland and the Republic made notorious in a previous era by paramilitaries and smugglers”.
In 2017, however, 66 people were arrested in a co-ordinated operation organised by Europol, in which eight EU Member States were involved. Two years later, a Paris court found four men guilty of falsely labelling horsemeat as beef. Other prosecutions were also mounted elsewhere.
Throughout the whole affair, though, there seemed to be a remarkable lack of curiosity as to why the system had become so vulnerable to fraud.
The European Commission, just as it had with the volcanic ash debacle, denied responsibility. The appropriately-named Commissioner Tonio Borg, in charge of food safety, dumped the blame on “food business operators”, then declaring that the Member States were responsible for enforcement of EU rules.
In comments to the media, he warned: “Let no one use this incident in order to undermine one of the greatest achievements of the European Union, the free movement of goods, including meat products throughout the European Union”.
The Irish Times was not buying it. “The impression was of an institution more concerned with protecting the single market than getting to the bottom of what now appears to be widespread fraud in the European food chain”, it wrote.
As the ultimate responsibility lay with the food industry, however, one might have expected an inquiry as to why major firms, many of them highly reputable such as Findus, Nestlé and Tesco, had been so easily caught out, risking massive reputational damage, costly product recalls and prosecution.
After all, as a Romanian meat trade spokesman had told the French media when his country’s abattoirs had been implicated, it should have been obvious to the firms that it was horsemeat. “It looks different and it smells different. If you are in the trade, you have to know the difference”.
The clue came in a French newspaper report, retailing the defence offered by the French company Comigel, explaining why it had not detected horsemeat in beef supplied by Spanghero. The meat had been delivered frozen, company president Erick Lehagre said, making it impossible “to detect deception” by its colour or its smell. And it bore “the French health stamp affixed by Spanghero”.
The reference to the frozen state is crucial and more than adequate evidence exists that the bulk (if not all) of the horsemeat supplied came in frozen blocks. In that state, it would be impossible to tell the difference between beef and horsemeat.
In normal practice, these blocks were added to bulk chilled meats during processing of products such as burgers and pie fillings, in order to keep the mixes cool. As they fed frozen blocks into the machines, operators would have next to no chance of detecting horsemeat substitution.
Nevertheless, the fraud could have been picked up by subjecting pre-production, samples to a simple “boiling test”, to bring up the characteristic smell. However, such direct testing had been dropped in favour of paper audits using a system known as Hazard Analysis and Critical Control Points (HACCP), written into EU law. Thus, it had become entirely normal to base controls on paper records, as did Comigel in its reference to “the French health stamp affixed by Spanghero”.
As Owen Paterson, Secretary of State for the Environment, put it in a Commons debate, “the system is very much paper-based and too much is taken on trust”. Under the regime as it then stood, the likes of Comigel were entitled to rely on the policing of health stamps by national officials who, in turn, had their systems evaluated by the Commission’s own inspectors from its Food and Veterinary Office (FVO).
However, there had been a double-whammy. Firstly, the Single Market, with its abolition of border controls, had not only freed up trade but also created massive opportunities for cross-border crime. Then, the replacement of conventional food controls by a document-based system had created a perfect storm.
There was no “deregulation” and nor was the food regulation “excessive”, in the sense that Cameron meant. Simply, it was the wrong tool for a job that had not been properly anticipated. But few politicians or their advisors understood the lesson they had been given. In many cases, they did not even appreciate that there was a lesson to learn, calling – as did Mary Creagh – for more regulation.
Creagh, however, was not alone. In a stern editorial, the Observer intoned that, “If the horsemeat scandal tells us anything it is that we need more government regulation, not less”. It’s all well and good, it said, “to tell the supermarkets that they have ‘ultimate responsibility’. But if they will not voluntarily police themselves with genuine rigour, then the state will have to do the job for them”.
Tellingly, the paper offered this diagnosis without knowing the background to the scandal, much less recognising that food law was an EU competence. But as much to the point, the EU had made a fundamental error in taking the HACCP system, which was devised as a food safety management tool, and turning it into an enforcement tool – for which purpose it was entirely unsuited.
If ever there was a case for the review of the balance of competences, therefore, this was it. But when the relevant report was published in July, there was no mention of it, even though the horsemeat incident had reduced confidence in the EU.
Thus, when it came to Cameron demanding a return of powers, he didn’t even know where to start. So complex was the regulatory relationship between the UK and the EU that our own politicians could not even begin to unravel it.
And there, possibly, lies a lesson for our present day politicians. They talk so glibly about taking back control, but in terms of detail they don’t have the first idea of where to start.