Official Report: Minutes of Evidence

The Chairperson (Mr Butler): I welcome the following departmental officials to the meeting: Dr Samantha Stewart, head of food security, beef, sheep and pig policy; and Mr Kieran Coghlan, deputy principal, food security, beef, sheep and pig policy. Thank you very much for attending today. Please brief the Committee.

Dr Samantha Stewart (Department of Agriculture, Environment and Rural Affairs): Good afternoon, Chair and members. I am grateful for the opportunity to brief you on the statutory rule (SR) introducing mandatory sheep carcass classification and price reporting in Northern Ireland. By way of background, in both Great Britain and Northern Ireland, it is mandatory to classify beef and pig carcasses by shape, fat and content quality and for market prices to be reported to the Department. Arrangements in Northern Ireland relating to classification of and price reporting for sheep carcasses is currently voluntary. Following UK-wide consultation on the remit of the Groceries Code Adjudicator, a recommendation was made to investigate introducing mandatory sheep carcass classification across the UK in order to improve fairness and transparency.

A full public consultation was run from 8 November 2021 to 16 January 2022 to seek views on introducing a mandatory system. There were three responses from organisations: two were in favour of introducing a mandatory system, while the other was opposed. A further targeted consultation ran from 5 February 2024 to 5 April 2024 to clarify a few areas not covered in the previous consultation, including authorisation of automated classification. That further consultation had three responses from organisations: two were in favour of the proposals, while the other was opposed. The Department provided the Committee with a written briefing on the outcome of the second consultation at its meeting on 20 February 2025.

While consideration was given to the possibility of retaining the existing voluntary system, that was discounted as it would not provide the consistency and transparency to all sectors of the industry that a mandatory system would provide. It would not provide the Department with the necessary enforcement powers to ensure high standards, it would leave the sheep sector out of step with the beef and pig sectors, and Northern Ireland would differ from the rest of the UK. Minister Muir decided to introduce a mandatory option via legislation, using domestic powers provided in the Agriculture Act 2020, and that is subject to draft affirmative resolution.

I will hand over to Kieran to outline the details of the SR.

Mr Kieran Coghlan (Department of Agriculture, Environment and Rural Affairs): Thanks. The main requirements in the SR are that it will apply only to sheep aged less than 12 months, and that only abattoirs slaughtering at least 1,000 sheep per week as a rolling annual average, or those that slaughter fewer than that number but choose to classify sheep carcasses, will be required to follow the requirements. It is estimated that over 90% of the sheep aged less than 12 months slaughtered in Northern Ireland will be captured by setting the figure at 1,000. That will also avoid adding additional regulatory and administrative burdens on smaller abattoirs.

Classification may be done by visual means by a person who is licensed by the Department to do so or by automated means that have been authorised by the Department. Provisions relating to automated classification methods come into force later than the rest of the regulations. That delay is necessary to collect the robust data sample needed to calibrate automated methods to NI flock and to assess and authorise those. There are currently no automated methods in use in Northern Ireland. Carcasses must be presented for classification to the prescribed standard. Nothing else prior to classification may be removed from the carcass except for veterinary reasons. While the GB Administrations are allowing an alternative presentation, that alternative presentation has never been used in Northern Ireland nor was the idea of introducing it here suggested at consultation.

Classification of carcasses will be based on shape, with conformation classes designated by the letters S, E, U, R, O or P, where S is the best and P is the worst; and on fatness, with classes designated on a 1-to-5 assessment. The meat industry is familiar with that carcass classification system through the mandatory scheme for beef carcasses, and the abattoirs that already classify sheep voluntarily use the system. The carcass must be weighed soon after slaughter to calculate the warm weight. The cold weight is then calculated by subtracting 2% from that warm weight. That aligns with the process in the beef and pig sectors. It differs from the current practice of subtracting a flat half a kilogram from the warm weight. That may require some software changes for processors. However, it provides for a more accurate cold weight, and it is consistent with the rest of the UK.

Regulated slaughterhouses must label and keep records that detail the weight classification result and category of each sheep. Records must also document the ear-tag number, which allows the producer to clearly identify the animal; the classification result; and the price paid. Details of each individual classification must be provided to the animal supplier and the Livestock and Meat Commission (LMC). For sheep purchased individually on a dead-weight basis, the price must also be reported to the supplier and the LMC, which will allow for market transparency and analysis.

The Department will have powers to audit and enforce the regulations. Slaughterhouses will receive unannounced visits from DAERA inspectors on a risk-based frequency. The inspections will look for potential breaches of the regulations in respect of carcass dressing, classification and weighing, mainly, but also of licences, record-keeping, labelling and reporting. It will be considered a breach to not fully comply with the inspections. Any breach can result in the Department issuing a warning letter or enforcement notice. Failure to adhere to those could lead to DAERA seeking prosecution at a Magistrates' Court. The Department will have the right to amend, alter or revoke licences in cases of poor compliance. The SR allows for appeals against those enforcement proceedings.

Dr Stewart: We consider the changes to be minimal, as much of what the SR requires is already done voluntarily. There has been communication and engagement with stakeholders regarding the changes that will be introduced. Processors' main concern will be the requirement to comply with severing the tail between the sixth and seventh caudal vertebrae. Whilst the Department's position on that is to bring the industry into line with standards in the EU and GB, it is understood that it is a change from the current practice, where the tail is completely removed. While we expect a certain bedding-in process for the new requirements, we do not expect there to be significant enforcement proceedings, similar to the current situation for the beef and pig schemes.

England, Scotland and Wales have already enacted similar legislation, albeit with different throughput thresholds to reflect their local industry scales. In the South, classification reporting remains voluntary, but they follow EU standards equivalent to those set out in the statutory rule.

Subject to the Committee's views and Assembly approval, it is tentatively proposed that the rule will come into force on 30 March 2026, when the slaughterhouses must notify the Department and obtain their licences within 28 days. From 27 April 2026, mandatory classification and reporting will apply to all relevant sheep carcasses. As I mentioned, there is a delay period for the authorisation of automated methods until 24 May 2027.

The introduction of mandatory sheep carcass classification price reporting will ensure greater transparency and fairness across the supply chain; provide robust enforcement mechanisms; and ensure parity with the rest of the UK. I appreciate that there was a lot of detail in the briefing, so I am happy to take any questions that the Committee might have.

The Chairperson (Mr Butler): Thank you so much. I will start. This is a bit of a busman's holiday for me, because I used to be a butcher, so I know what it is like to deal with sheep and lamb carcasses. When the carcasses came into the shop, they did not have a tail. The Northern Ireland Meat Exporters Association (NIMEA) raised a query, stating that the requirements for severing the tail mean that that:

You have alluded to the fact that it will require a slightly different methodology to be employed. NIMEA suggested that it will create:

Do you have a different perspective on that?

Dr Stewart: We engaged with processors after the Minister made his decision to implement the legislation, and that theme was raised with us consistently. We understand that it is a change in the practice, but the key point is that there are standard processes in place across the UK and Ireland. Every carcass is treated in the same way up to a point on the scale, and that is when the weighing and classification are done. After that, the carcass can be further butchered to customer specifications, and the tail can come off at that point. As I said, England and Wales are slightly ahead of us with the legislation. I made enquiries with GB colleagues about how the legislation is bedding down. They said that they had similar pushback on compliance with that specification but that, once they made it clear and said, "This is what's in the legislation; you can do whatever after that", there had been compliance.

Hygiene requirements are the other concern. We sought the advice of our veterinary colleagues. There is no veterinary requirement for full removal of the tail, but the legislation allows for trimming of the tail if there is visible contamination, which is in line with veterinary requirements.

The Chairperson (Mr Butler): OK. I find it intriguing that this is optional for those that slaughter fewer than 1,000 sheep or lambs per week. Does that have any implications? The Department claims that the mandatory classification will:

Will it be the reverse for those that slaughter fewer than 1,000? Are you suggesting that they will not see the same price transparency and fairness if they do not comply and apply the same standard?

Dr Stewart: The balance for the throughput was reached based on the regulatory burden for small abattoirs. That is where the threshold came from. That is not to suggest that there are problems with not having it be mandatory; it is just that we now have the powers to correct issues, if there are any.

Mr Coghlan: On the question of price transparency, as I said, 90%-plus of sheep will be captured, but those are the ones that are above the throughput threshold. Smaller producers will still see that 90% of data and be able to compare the price that they get from smaller abattoirs. There will still be transparency, therefore, but they will not need to contribute their data to the prices that are published.

The Chairperson (Mr Butler): The Department's submission states that its assessment is that the implications, whether regulatory or financial, are minimal and that most of the costs will be borne by the Department. Is that still the case?

Dr Stewart: Yes. Abattoirs, in the main, do it currently. The big change, in the short term, is that they will have to spend some time getting their licences. We anticipate trying to do that in one day in order to minimise people's time spent out of the abattoir. There will also be software changes to the scales to apply the change from a reduction of half a kilo to a reduction of 2%.

The Chairperson (Mr Butler): This is my final question. The SL1 states:

What is the purpose of the automated machine? What does it do, and where are we with regard to the process here mirroring what is happening on the mainland?

Dr Stewart: There are no such machines for sheep in Northern Ireland that I am aware of. Whether to bring one in would be a commercial decision for the abattoir. We understand that there are a number of such machines for beef and that they are pretty highly regarded when it comes to the independence between processor and farmer for the gradings. The throughput of beef is much higher than that of sheep, however, so it is a commercial decision for abattoirs whether they purchase one of those.

We are still working through guidance on how authorisation of automation might work. I anticipate its being similar to what was done for the beef machines in 2010 and 2011.

Mr Coghlan: The requirements for automation are contained in schedule 2 to the SR, but we are still working on some of the practical aspects of how it will work.

The Chairperson (Mr Butler): OK. Thank you.

Mr McAleer: The starting point for me is what is in the best interests of farmers; that is my first interest. We know, from looking at the food supply chain, that farmers are the primary producers, but there is imbalance in the supply chain that has not been addressed by the Groceries Code Adjudicator. We export around half a million sheep from the North to the South every year. There is going to be a mandatory system in the North and a voluntary system in the South. Will that place farmers here at any sort of disadvantage?

Dr Stewart: The requirements in the SR replicate what is in the EU legislation — they include the same standards on presentation. By contrast, it is voluntary in the South, where it is the Department of Agriculture, Food and the Marine that does the checks, but the standards are the same. We would have higher standards for checking the same compliance of the abattoirs, but it will be the same presentation of the carcass, so there will be no difference in the carcass presentation. The grading system is the same as well, so the grades will be the same in the North and the South.

Mr McAleer: Explain what exactly is meant by voluntary and mandatory. Is the onus on the processors? Where is the onus placed when something becomes mandatory?

Mr Coghlan: There are EU regulations that basically say, "You do not have to bring in mandatory carcass classification and price reporting, but, if you do, this is the standard". The Republic of Ireland works towards that standard. It is a voluntary system there, so they have no enforcement powers, but, as Samantha said, it is basically the same standard.

Dr Stewart: In the South, if they come across issues with presentation — say, the length of the tail — they can ask the processor to bring it more into line with the standard, but there is no obligation on the processor to comply.

Mr McAleer: If this creates a more transparent and favourable regime for sheep farmers here, might farmers in the South want to process their sheep in the North?

Dr Stewart: It will take a while for the practice to bed in, but, from what we have seen, it was fairly smooth in England. We would not anticipate what you suggest. We have the same standards, North and South; it is just that the Department here has the power to correct.

Mr McAleer: Is there potential for this to slow down the production line?

Dr Stewart: A requirement of the legislation is that the ear tag will be provided. The Ulster Farmers' Union asked for that, for reasons of transparency in respect of genetics and breeding, so that farmers could correctly match the sheep that they are paid for and the price that they get. The reading of the ear-tag number happens on the line, but it does not happen 100% of the time. Rather than making it mandatory to stop the line to record the number manually —. We worked with the processors to understand their requirements. If they have the number, they must provide it. Our understanding is that it should not slow down the line.

Mr Coghlan: There can be an issue with the ear-tag number, but we understand that it is not a common issue. Sheep typically go through in batches of 10, and the majority will be read by the scanner. There might be one sheep on which the tag has been damaged, but, even then, because they are in a batch of 10, farmers should be able to work out, "OK, that is the odd one out: it must be that ear-tag number", so that is not an issue. There might be the odd time when two in the same batch are broken, but we have a bit of discretion there. We do not need to enforce if they are doing their best to read the tags, but the scanner plays up and they cannot match them. As we have that discretion, I do not think that it will affect the line.

Mr McAleer: Thank you.

Ms Finnegan: Farmers are in favour of the regulations, and the meat processors are against them. Does that mean that farmers will get a better or fairer price if the regulations are implemented?

Dr Stewart: All carcasses will be treated to the same standard. What was happening, more so in England than here, was excessive trimming of carcasses before they were weighed. Those trimmings were sold for other uses, so farmers were not getting paid for them. Now, we have standardised the process so that everybody knows what they are getting paid for. They are all getting paid for the same —.

Ms Finnegan: OK. For clarity: farmers are not being asked to pay for implementing the regulations.

Dr Stewart: No.

Ms Finnegan: OK, perfect. Thank you.

The Chairperson (Mr Butler): There are no further questions. Thank you so much for your time; we appreciate it.