Food safety – an introduction Lecture 35 Economics of Food Markets Alan Matthews

Lecture objectives Why is food safety a growing issue? What is the contribution of economists to the debate on food safety policy? The notion of risk EU food safety institutions

Reading Kinsey overview

Dimensions of food safety Three dimensions of food safety (Kinsey) –Safety from food poisoning –Safety from poor diets –Safety from bioterrorism

The scope of food safety regulation The wide range of food safety regulation –Protection of the consumer against adulteration of food and drink one of the earliest examples of social legislation –Sanitary conditions in food preparation, packaging and handling; pesticide and hormone residues; packaging materials, food additives; labelling requirements; weights and measures legislation

The growing demand for food safety Risks of food-borne diseases have increased Economic growth increases consumer demand for quality attributes generally and food safety in particular Because of changing consumption habits, the consumer now more dependent on public authorities for food safety Economic studies in US suggest high costs to food-borne illnesses

Key questions Do the benefits of growing food regulation outweigh their cost? Could we deliver a particular level of food safety more efficiently? Food safety regulations differ from country to country, making food law a non-tariff barrier to trade. When is this legitimate consumer protection, and when industry protectionism?

Risk analysis The three legs of risk analysis –Risk assessment –Risk management –Risk communication To which we can also add –Control and enforcement Now embodied in WTO rules. Implication is that regulatory decisions based on risk analysis should be consistent across different aspects of food safety

Issues arising from risk analysis Techniques of risk assessment Determination of the acceptable risk standard Consumer perceptions of risk often different to expert assessments Consumers may lack confidence in the public authorities conducting the risk management What to do when scientific understanding is incomplete – the precautionary principle

The EU approach to food safety regulation Totally overhauled following the BSE debacle in 1996, became the key priority for the Santer Commission Green Paper on Food Law published in 1997 as basis for discussion 2000 White Paper on Food Safety Implementation overseen by DG SANCO under Commissioner David Byrne

The EU approach to food safety regulation Risk assessment now undertaken by the European Food Safety Authority -> scientific advice Risk management based on clear legislation proposed by Commission and implemented by Council. Massive overhaul of EU food law Risk control – substantial strengthening of the EU framework for enforcement of food safety regulations overseen by the Food and Veterinary Office of the Commission Risk communication – responsibility of the EFSA