Tax breaks would help Scottish meat industry

By Eddie Barnes
Published on 08/07/2012 02:05

MINISTERS should give tax breaks to supermarkets that support the UK meat industry as part of a bid to save processing plants, such as Hall’s in Broxburn, from closure, according to academics.

A study into the major problems facing Britain’s pig industry recommends retailers should be offered incentives such as lower corporation tax rates if they set up a steady chain of supply from producers and farmers based in this country.

The report reveals that Britain is becoming more and more reliant on cheap, imported pork, with home grown products making up just 50 per cent of the market, compared to 80 per cent in the late 1990s.

The paper, by the Centre for Research on Socioeconomic Change at Manchester University, says the government should now provide incentives to encourage the leading stores to support, or even take over, producers like Hall’s, in order to boost the UK industry.

“The government has leverage in fiscal measures. Using targeted tax cuts to incentivise supermarkets to integrate with processors is what we recommend,” said report author, Dr Andrew Bowman.

The report also suggests that, with incentives, one of the big stores could be tempted to buy the Hall’s factory.

Fellow author Sukhdev Johal added: “Every household spends an average of £100 on their weekly shop. Pig meat consumption is rising and if one of the supermarkets bought Hall’s it could make a huge profit as the returns are very high. Perhaps it’s possible for the Scottish government to provide incentives to make this happen?”

The call comes amid frantic efforts to stem the worst of the proposed job cuts at Hall’s, announced last week. Parent company Vion UK said that it could no longer sustain losses of £79,000 a day. The jobs of 1,700 workers are threatened.

A ministerial task force has now been set up ahead of a 90-day consultation 
period as the Scottish Government attempts to find 
a way of keeping the plant open.

However, analysts are warning that the ageing 
nature of the processing plant makes it deeply unproductive and believe there will be few private sector firms willing to take it on in its present form, without major government support.