'M. Bovis' outbreak could cost $95m, says MPI

The Ministry for Primary Industries estimates the Mycoplasma bovis outbreak could cost about $95 million for tracking and tracing the spread of the disease and paying compensation to farmers, Parliament's primary production select committee heard.

MPI director of readiness and response Geoff Gwyn told politicians the ministry had budgeted $35 million of operating expenditure for the response until the end of the financial year, which had funded 95,000 serum tests, and believed its claims liability would be $60million. To date, the disease had been confirmed at 26 properties which formed part of 43 properties under a restricted place notice, he said. A further 55 properties had been placed under a notice of direction, and on top of that more than 670 farms were under some form of surveillance.

Mr Gwyn said the ministry had investigated ways to fast-track compensation payments, including interim distributions and accepting multiple claims to help ease farmer cashflow, and had received 51 claims and paid about $2.6 million on 10 of those either in part or in full. Property owners could lodge claims for any verifiable losses caused by MPI enforcing its powers.

``We are mindful of the impact cashflow has on business,'' he said.

``It's a process we've streamlined as fast as possible. The reality is we still have situations where farmers are feeling as though they're not being compensated but in reality they're not putting in a claim at this point.''

M. bovis was first confirmed in July on two farms in South Canterbury, marking New Zealand's first official outbreak of a disease present in many other countries. While the disease presents no food safety risk, it can cause a range of symptoms in cattle that do not respond to treatment - pneumonia, arthritis, mastitis and late-term abortions.

MPI director-general Martyn Dunne told politicians the ministry was still optimistic it could eradicate the disease, but that a final decision would be made this month.

``Our aim is to eradicate. We're not going to say we're going to long-term management now. Our aspirations are to remove this if we can from the New Zealand herd,'' he said.

MPI has gone back to the Government for funding the response and Mr Dunne said he was ``confident'' it would be considered in the forthcoming budget requests.

Mr Dunne said the ministry was negotiating with industry on its financial contribution to the outbreak, and he would prefer the issue of cost recovery was handled through a Government industry agreement rather than outside that process.

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