A 4.2% increase in the levy paid by producers and abattoirs in Wales is set to ensure the red meat sector in Wales faces a sustainable future. The levy is used by Hybu Cig Cymru – Meat Promotion Wales (HCC) to fund activities to assist with the development of the Welsh red meat industry (sheep, cattle and pigs), notably work that would not be done under normal market conditions.
The Welsh Red Meat Levy rates were increased in April 2023 and following a conversation with industry, a mechanism was introduced to link future levy increases to the Consumer Prices Index including owner occupiers' housing costs (CPIH).
“The mechanism did not include an automatic annual increase but allowed the HCC Board to make any increase recommendations to the Minister based on the previous calendar year’s CPIH.
“Prior to 2023 the Welsh Red Meat Levy rates had been static for 12 years (since 2011) and increases before that were in 2001 (10 years previous) and in 1996. Levy rate increases in the past were one-off increases agreed by the industry to reflect inflationary changes over the preceding years. In 2011 the rates were increased by 24 percent,” explained Gareth Jones, HCC’s Head of Finance and Corporate Governance.
Before 2023, HCC also augmented levy income with additional grant income, and since April 2021 the Red Meat Levy Redistribution Scheme has been operational, with Wales now benefiting from a redistribution of levy.
Mr. Jones added: “The decision to link levy rates to annual inflation in 2023, using a tracker, ensured that levy income was maintained in real terms and would remain at a level where spending power is not compromised.”
Laura Pickup, HCC’s Head of Strategic Marketing and Connections, added: “Given the breadth and depth of the challenges facing the Welsh red meat industry, it is essential that the Welsh red meat industry has a sufficiently funded red meat body to undertake development, promotion and marketing of Welsh red meat, both at home and abroad.
Through such a levy increase we will maintain the momentum already achieved and it aligns to the delivery expectations of our levy payers, and to the agreed objectives of the HCC Business Plan 2022-2026.”
