Scottish Government

5 Costs

5.1 Sheep Identification

5.1.1 - number of animals:

• There are around 7.1 million sheep in Scotland.
• This includes approx 3.7 million lambs, of which approx 70% (2.6 million) are intended for slaughter before the age of 12 months
• Of the 2.6 million slaughter lambs 50% of the animals are estimated to go direct to slaughter and 50% are slaughtered after being on at least two holdings.
• The remaining 30% of the lamb crop (1.1 million) are retained beyond the 12 months, mainly as breeding animals.
• Of the 1.1 million breeding animals approximately 50% (550,000) will be kept on the holding of birth, with the other half moving to a different location.

5.1.2 Costs of means of identification will vary between different manufactures and the type of device used. This RIA therefore assumes that the average cost purchasing two means of identification is £1 per animal (based on one conventional eartag (approx £0.15), and one electronic tag (approx £0.85p)).

5.1.3 Previous studies have shown that it takes around 92.4 seconds to apply a conventional and EID tag to a single animal. This falls broadly in line with results from the Scottish Electronic research pilot which indicates that it can take two people one minute to indentify an animal. This RIA therefore assumes that it take on average one person 100 seconds to identify an animal with the two means of identification (36 animals per hour). Similarly previous studies have shown it takes on average 33 seconds to apply a single tag (109 animals per hour).

5.1.4 Labour costs associated across the livestock sector are averaged at £7.97 per person per hour (figures from Scottish Government Economists on costing of Land Management Options 2009).

Option one - Do nothing.

5.2.1 The costs associated to this option can be linked to those produced in the RIA for Scotland on the implementation of double tagging for ovine and caprine animals under Council Regulation ( EC) 21/2004 that was produced in December 2007. Since that document was produced several factors have changed that slightly alter figure given at this point - i) the ration of animals slaughtered under 12 months of age or not has changed for 60:40 to 70:30. The labour costs have also slightly decreased and the costs of eartags have reduced.

5.2.2 Under this option 70% of all newborn lambs would require a single batch tag with the remaining 30% requiring two eartags. The cost of purchasing identification therefore estimated to cost £720,000 (2.6 million lambs X £0.15 + 1.1 million lambs X £0.30).

5.2.3 Using a labour rate of £7.97, the labour cost associated with identifying all new born lambs under this option is estimated to be £278,510 (70% of all lambs/ 109 (number of animals single tagged per hour) X £7.97 + 30% of all lambs/55 (number of animals double tagged in per hour) X £7.97).

5.2.4 Replacement tags are estimated to be 5% of the flock. It is assumed that the vast majority of keepers would not replace a lost identifier with an identical identifier and would instead replace with new identifiers. On this basis costs for replacement tags for animals born after 01 January 2010 is estimated to be £36,000 (5% of 2.6 million X £0.15 + 5% of 1.1 million X £0.30).

5.2.5 The total cost for identifying animals under this option is there estimated to be £1,105,510

Option two - Full EID implementation

5.3.1 Under this option 2 all newborn lambs would have to be identified with two means of identification, one which must be electronic. The cost of purchasing the means of identification is therefore estimated to be £3,700,000 (3.7 million lambs x £1).

5.3.2 Using the labour rate of £7.97 per hour, the labour costs associated with identifying the 3.7 million lambs is therefore estimated to be £819,139 (3.7 million lambs / 36 (animals identified per hour) x £7.97).

5.3.3 Replacement tags are estimated to be 5% of the flock. It is assumed that the vast majority of keepers would not replace a lost identifier with an identical identifier and would instead replace with new identifiers. On this basis costs for replacement tags for animals born after 01 January 2010 is therefore estimated to be £185,000 (5% of 3.7 million lambs x £1.00).

5.3.4 The total cost of identifying animals under option two is therefore estimated to be £4,704,139

5.3.5 The total additional cost of identifying animals as a result of option two is therefore estimated to be £ 3,598,629

Option 3 - Restricted slaughter derogation

5.4.1 Under this option all lambs not sent direct to slaughter would have to be identified with two means of identification, one of which must be electronic. Animals that are sent direct to slaughter would only require a single plastic eartag. Therefore the costs of purchasing means of identification under this option is estimated to be £2,599,250 (direct to slaughter 35% of 3,700,000 x £0.15 = £194,250 + not direct to slaughter 65% of 3,700,000 x £1= £2,405,000).

5.4.2 Using the labour rate of £7.97 per hour, the labour costs associated with identifying the 3.7 million lambs under this option is estimated to be £627,129 (direct to slaughter 35% of 3,700,000 / 109 (animals identified per hour) X £7.97 = £94,689 + not direct to slaughter 65% of 3,700,000 / 36 (animals identified per hour) x £7.97 = £532,440).

5.4.3 Replacement tags are estimated to be 5% of the flock. It is assumed that the vast majority of keepers would not replace a lost identifier with an identical identifier and would instead replace with new identifiers. On this basis costs for replacement tags for animals born after 01 January 2010 under this option is estimated to be £129,962 (5% of 35% of all lambs (direct to slaughter) x £0.15 = £9,712 + 5% of 65% of all lambs (not direct to slaughter) x £1 = £120,250).

5.4.4 The total cost of identifying animals under option three is therefore estimated to be £ 3,261,652

5.4.5 The total additional cost of identifying animals as a result of option three is therefore estimated to be £2,156,142

Option 4 - Full slaughter derogation

5.5.1 Under this option all lambs intended for slaughter within 12 months of age only require a single plastic tag. All other animals would have to be identified with two means of identification, one which must be electronic. Therefore the costs of purchasing means of identification under this option is estimated to be £1,498,500 (intended for slaughter 70% of all lambs x £0.15 = £388,500 + not intended for slaughter 30% of all lambs x £1 = £1,110,000).

5.5.2 Using the labour rate of £7.97 per hour, the labour costs associated with identifying the 3.7 million lambs under this option is estimated to be £435,121 (intended for slaughter 70% of all lambs / 109 (animals identified per hour) x £7.97 = £189,379) + not intended for slaughter 30% of all lambs / 36 (animals identified per hour) x £7.97 = £245,742).

5.5.3 Replacement tags are estimated to be 5% of the flock. It is assumed that the vast majority of keepers would not replace a lost identifier with an identical identifier and would instead replace with new identifiers. On this basis costs for replacement tags for animals born after 01 January 2010 under this option is estimated to be £74,925 (5% of 70% of all lambs intended for slaughter x £0.15 = £19,425 + 5% of 30% of all lambs not intended for slaughter) x £1 = £74,925).

5.5.4 The total cost of identifying animals under option four is therefore estimated to be £ 2,008,546

5.5.5 The total additional cost of identifying animals as a result of option four is therefore estimated to be £ 903,036

Option 5 - Electronic slaughter tag derogation

5.6.1 Under this option all lambs intended for slaughter within 12 months of age could be identified by a single electronic tag. All other animals would have to be identified with two means of identification, one which must be electronic. Therefore the costs of purchasing means of identification under this option is estimated to be £3,311,500 (intended for slaughter 70% of all lambs x £0.85 = £2,201,500 + not intended for slaughter 30% of all lambs x £1 = £1,110,000).

5.6.2 Using the labour rate of £7.97 per hour, the labour costs associated with identifying the 3.7 million lambs under this option is estimated to be £435,121 (intended for slaughter 70% of all lambs / 109 (animals identified per hour) x £7.97 = £189,379) + not intended for slaughter 30% of all lambs / 36 (animals identified per hour) x £7.97 = £245,742).

5.6.3 Replacement tags are estimated to be 5% of the flock. It is assumed that the vast majority of keepers would not replace a lost identifier with an identical identifier and would instead replace with new identifiers. On this basis costs for replacement tags for animals born after 01 January 2010 under this option is estimated to be £165,575 (5% of 70% of all lambs intended for slaughter x £0.85 = £110,075 + 5% of 30% of all lambs not intended for slaughter) x £1 = £74,925).

5.6.4 The total cost of identifying animals under option five is therefore estimated to be £3,922,196

5.6.5 The total additional cost of identifying animals as a result of this option is therefore estimated to be £2,816.686

Table one - summary costs for identification

5.7 Movement Documents and Critical Control Points

5.7.1 Information from the Scottish Animal Movement System ( SAMS - the current competent authority database) shows that there are approximately 320,000 batch movements covering over 7,500,000 animals. This equates to 23.5 animals per batch.

5.7.2 In line with 5.1.1 (percentage split of the national flock) this RIA assumes that of the 320,000 batch movements, 51% will be animals from the new lamb crop, and 49% from the older population.

5.7.3 Information for the Scottish Animal Movement System ( SAMS) and those from EPIC which were used to underpin the Scudamore review of FMD 2007 suggest that 30% of all moves are moves from farm to farm, 40% are moves from farms to markets (and then on a farm or abattoir) and 30% of moves are from farm to abattoir.

5.7.4 Labour costs associated across the livestock sector are averaged at £7.97 per person per hour (figures from Scottish Government Economists on costing of Land Management Options 2009).

5.7.5 Results from the Scottish Government electronic research pilot shows that it takes on average around 6 seconds per animal for on farm hand held EID reading, whilst faxed panel readers takes around 3 seconds. Manual reading and recording by comparison takes around 2 minutes per sheep.

5.7.6 Results from the Scottish Government electronic research pilot shows that it takes around 5 minutes to upload data captured by a hand held device, regardless of the number of animals. Timing is automatic by fixed panel readers. Manual recording onto paper documents (and holding registers) takes around 2 minutes per animal.

5.7.7 EID reading and recording equipment will vary in specification and cost but figures of £600 for hand help equipment and £10,000 for fixed panels at markets and £5,000 at abattoirs are indicative of the equipment available and therefore used for the purpose of this RIA. This RIA uses the figure of 20 markets in Scotland and 30 abattoirs.

5.7.8 There are approx 15,000 sheep holdings and keepers in Scotland (Scottish Government data). Of these approximately 50% have flock sizes of less than 100 animals (Scottish Government Economic Report on Scottish Agriculture 2009 edition). Results from the Scottish Government Electronic research pilot suggests that EID reading equipment would not be required for flocks of less than 100 animals.

Option 1 - Allow the use of CCP's

5.8.1 Installation of fixed panel readers at CCP's is estimated to cost £350,000 (20 markets X £10,000 + 30 abattoirs X £5,000).

5.8.2 All 320,000 batch movements require an accompanying movement document. Approximately 70% of batches (224,000) go through markets and abattoirs - possible critical control points. Reading and recording of animals at CCP's would be automatic and therefore there would be negligible costs in doing so (on the assumption that animals do not require to be re-read). Therefore a nil cost is used for this RIA.

5.8.3 96,000 batch moves may not go through a CCP's (i.e. farm to farm moves) Using the same proportionate figure as paragraph 5.8.2 (70-30% split) this could equate to 4,500 holdings (30% of all keepers). In line with point 5.7.8 it can be assumed that 50% of these holdings (2250) will require EID reading equipment at some point and therefore the cost of for reading equipment on farm is estimated to be would be £1,350,000 (2250 holdings x £600).

5.8.4 On assumption that all animals will require to be individually identified (i.e. no slaughter derogation) then labour costs for reading and recording the 96,000 batch movements by use of hand held equipment is estimated to be £346,535 based on 50% of the batches being recorded by EID equipment and 50% manual (48,000 batches x 23.5 animals / 600 x £7.97) + 48000 / 12 batches per hour x £7.97 = £46,863 + 48,000 batches X 23.5 animals / 30 x £7.97 = £299.672).

5.8.4 Therefore the total additional costs associated with the reading and recording movement documents with the use CCP's is estimated to be £2,046,535

Option 2 - do not use CCP's

5.9.1 It is assumed that high throughput premises (i.e. markets and abattoirs) will require EID reading equipment to fulfil their regulatory requirements, regardless if CCP's are used or not. Therefore equipment costs for markets and abattoirs are estimated to be £350,000 in line with point 5.8.1.

5.9.2 On the basis that 50% of all holdings will require EID reading equipment at some point the costs for reading equipment on farm is estimated to be £4,500,000 (7500 holdings X £600 reading equipment).

5.9.3 On the assumption that all animals will require to be individually identified (i.e. no slaughter derogation) then labour costs for reading and recording 160,000 batch movements (50% of the total batch movements) by use of hand held equipment is estimated to be £156,211 (160,000 batches x 23.5 animals) / 600 x £7.97) + (160,000 /12 batches per hour) x £7.97).

5.9.4 Following on from point 5.9.3 it can be assumed that 50% of all batch movements will require to be manually recorded. The labour costs associated with manually reading and recording is therefore estimated to be £998,906 (160,000 batches x 23.5 animals) / 30 x £7.97)

Therefore the total additional costs associated reading and recording movement documents with no use of CCP's is estimated to be £6,005,117

Table 2 - Summary of costs associated with the use and non use of CCP's

5.10 Holding Registers

5.10.1 As mentioned in the main consultation there is no change to the recording requirements for animals born before 31 December 2010. For those that are born after this date then the following information is required; individual identity of animal; the year of birth and date the animal was identified, the month and year of death; and the breed and genotype (if known). If any animal is identified under the slaughter derogation at the batch level then information would be recorded at a batch level.

5.10.2 It is assumed that births will be entered in runs of consecutive numbers and therefore there will be minimal time and effort required to record this information (i.e. entry need only say 50 animals (numbers 1-50) born in 2010, identified on 01 March 2010. Therefore no cost is associated to this activity.

5.10.3 Animals that die on farm prior to being identified (i.e. any animal still on the holding of birth that has not been identified within 9 months) will not require their death details to be recorded.

5.10.4 On farm deaths for identified animals is approximately 5% of the flock (2-3% found on lowland farms and 5-7% of upland farms - therefore 5% is average. From Scottish Electronic Research Pilot information) In line with point 5.7.6 it takes 2 mins per animals to manually read and record an animal. The costs therefore associated with completing the holding register with death details is £49,148 (2% of all lambs / 30 animals per hour x £7.97).

5.10.5 The requirement to record individual animal's movements onto a holding register will be in line with the requirement of the movement documents as outlined in sections 5.7 to 5.9. However, as the information in movement documents can be used for the purpose of the holding registers then no extra costs will be associated to populate the holding register.

5.10.6 Therefore the costs associated with the extra requirements of the holding register will be £49,148.

5.11 Central Database

5.11.1 There are no new provisions for a central database to hold individual animal information under the Regulations, however, benefits could be realised if one exists. Costs below are therefore kept in general terms, with more detailed work being required if an individual database is deemed appropriate.

5.11.2 If a central database is required it will incur both start up costs and running costs. In the absence of working examples elsewhere to draw upon, the magnitude of such costs is difficult to gauge. However assessments in Spain and the Netherlands suggest running costs in the order of £0.1 per sheep and £0.8 per ewe which equates to around £0.7m to £2.5 in Scotland, with £1.6m as an average.

5.11.3 Within this estimate, the treatment of incomplete data could be an important cost component - reconciliation. If an error rate of 2.5% was witnessed on an individual animal identity this would equate to 92,500 reconciliations. If these reconciliations could be achieved automatically then the costs would be minimal. However if, as with reconciliations associated with the British Cattle Movement Service ( BCMS), labour input was required then costs would increase. Using the approximate figure of £5 per reconciliation as witnessed by the BCMS then costs would be £462,500

5.11.4 The total initial costs therefore associated with an individual database would cost in the region of £2,062,500 (discussions on funding of any such database would be required before any commitment).

5.11.5 The Scottish Government believes that should the full intended slaughter derogation be introduced as the only system then it would not make sense to have a centralised individual database given that 70% of the animals would not be individually indentified. A centralised database, however, could be utilised for any of the other options.

5.12 Analysis of the Impacts of the EID regulation on Farm businesses using farm accounts survey ( FAS) data

5.12.1 The additional costs associated with the different options for the implementation of the European EID regulation in Scotland are calculated above and this analysis takes these figures and applies them at a farm business level (on a cost per animal basis). This allows for the relative impacts on different farm types to be examined, using FAS data to estimate the expected changes to farm business costs and therefore net profitability. The analysis allows for indicative profitability and farm business cost figures to be estimated by farm type.

5.12.2 The analysis considers each of the four options for implementation in turn (it assumes that the impact of option one - do nothing is zero). It also looks at the marginal effect of the decisions around critical control points, by examining all four options under the assumption that critical control points are approved as part of the EID implementation, and then examining the most and least costly options (full EID implementation and implementation with the full slaughter derogation) under the assumption that critical control points ( CCP's) would not be used.

5.12.3 The final element of the analysis is that the FAS dataset allows the examination of the increased costs due to EID on the top 25% of the most profitable farms, as well as the bottom 25%, which can show how more and less profitable businesses would be affected. However, some caution should be taken here, as the sample size of the farm accounts survey means that for certain farm types any results split by profitability quartile would be based on restricted sample sizes which limits the extent to which the results can be applied to the whole of Scottish agriculture. To this end all that can be said is that it is likely that the most profitable farms would face smaller costs than the least profitable farms, which in general are less able to control their input costs.

5.12.4 The following results tables show firstly, the average cost increase, secondly, the cost increase as a percentage of the total farm business costs, and finally the cost increase as a percentage of the total profits. Unless it is stated otherwise, the results are calculated for each option, assuming that critical control points are allowed. It should be noted that the cost shown is an average cost, and so there is likely to be some variation in the actual costs that are faced by producers.

Table 3 - Average cost increase per farm for policy options (with CCPs)

5.12.5 In terms of the absolute increase in average costs per farm, the farm types that are most affected by this regulation are LFA specialist sheep and LFA cattle and sheep farms. The exact increase in costs is determined by the option. As has been shown previously, full EID implementation (option 2) is the most costly option for industry, and the types of farm that will be affected the most are those which keep sheep, and have low profitability. Under this option LFA cattle & sheep farmers would see an increase in their business costs of about £867 on average, whilst the average LFA specialist sheep would see an increase of around £714. Lowground Cattle and sheep farmers would only see an increase of £315 on average and the increase in costs across all farm types would be £326 on average under this option.

5.12.6 The option which would have the smallest effect on industry is the full slaughter derogation (option 4); this would meant that an average LFA cattle & sheep farm would experience a £441 increase in costs, whilst the average LFA specialist sheep producer would see an increase of around £364 on average. The average farm under all farm types would experience an increase of £166 under this option.

5.12.7 The estimates of additional costs incurred as a result of the regulation are more useful when set in the context of the business costs prior to the regulation. Table 4 shows the costs as a percentage of total farm business costs for 2008.

Table 4 - Additional costs as a percentage of total farm business costs

5.12.8 Once again, table 4 shows that the largest impact on producers would be under full implementation, and the smallest impact would be under the full slaughter derogation, however the results also show that LFA specialist sheep would be the worst hit (as a proportion of their total farm business costs) under any option, with the average producer facing between a 1.75% and 0.89% increase in its total farm business costs. LFA cattle and sheep would be the next worst hit, whilst LFA beef and lowground cattle and sheep farms would both be affected more than the average over all farm types.

5.12.9 As the results above show, some farms will be hit proportionally more than others, and this would lead to relatively small increases in costs causing significant percentage increases in farm business costs. The following results table shows how these increased costs affect overall net profit.

Table 5 - Additional costs as a percentage of farm net profit

5.12.10 The above table shows the size of the average additional costs relative to the net profit of the average business. It shows that under full EID implementation the additional costs to an average LFA sheep farm would be equal to 3.96% of net profit, and 3.17% of the average net profit for LFA cattle and sheep farms. LFA specialist beef and lowground cattle and sheep both see increases in their farm business costs equivalent to over 1% of their net profit, and the average farm over all farm types would see an increase equal to 0.76% of its net profits.

5.12.11 These increases would fall depending on the different options, and under the cheapest, where a full slaughter derogation is imposed (option 4) then the LFA specialist sheep farm would see an increase in costs equal to just over 2% of net profit, with LFA Cattle and sheep seeing an increase of 1.61% of net profits. On average across all farm types, farms would see an increase in costs equivalent to 0.39% of net profit.

5.12.12 These results show that under every option, farms that are LFA specialist sheep have the largest increase in costs as a proportion of their total farm business costs and net profits, but LFA cattle and sheep farms are likely to see the largest absolute increase in costs.

5.12.13 The previous results were estimated under the assumption that critical control points would be adopted, the following now considers the changes that would occur if critical control points were not adopted as part of the policy.

5.12.14 The non-adoption of critical control points would increase the costs of the implementation of the EID regulation quite considerably. By comparing the figures of the impacts on farm business costs both with and without critical control points, the marginal effect that this decision has on farm businesses can be shown. Table 4 below shows the average cost increase under option 2 and option 4, the other options will have costs somewhere in between these two extremes.

Table 6 - Average increase in farm business costs by farm type

5.12.15 Table 6 shows that without critical control points under option 2 the average LFA cattle and sheep producer would see an extra £926 added to his costs, and the average LFA specialist sheep farm would be £763 worse off relative to option 2 where CCPs were implemented as part of the regulation. Under option 4 this increase is slightly lower, but still high; LFA Cattle and sheep farms would face an extra £728 on average on top of the costs of option 4 without CCPs, and the average LFA specialist sheep farm would also see £600 in additional costs because of the non adoption of CCPs under this option. Table 5 shows these costs in the context of total farm business costs by farm type.

Table 7 - Average increase in farm business costs by farm type

5.12.16 Table 7 illustrates the increase in costs as a result of the non adoption of CCPs, as a proportion of total farm business costs the cost under these options is much higher than under the same options where CCPs are implemented. Under option 2 LFA sheep farmers see an average additional cost from the regulation of 3.61% of total farm business costs, compared with 1.75% in the case where CCPs were to be allowed. Under option 4 without CCPs the average cost increase for LFA sheep farmers would be equal to 2.76% of total farm business costs, but with CCPs it would be only 0.89%.

Table 8 - Cost transferred as a percentage of net profit

5.12.17 Table 8 shows these costs as a percentage of net profit, and the figures are striking in their size comparative to those where CCPs are implemented. The average LFA specialist sheep farm would face a cost equal to 8.18% of its net profit under option 2 with no CCPs, and the average LFA cattle and sheep farm would see costs equal to 6.55% of net profit also. This compared to a respective 3.96% and 3.17% of net profit under option with CCPs allowed.

5.12.18 Under option 4 the costs are still large as a proportion of the farm's net profits. The average LFA specialist sheep farm would face a cost equal to 6.24% of net profit, and LFA cattle and sheep farms would see a cost on average just under 5% of net profits. This can be compared to the scenario where CCPs are implemented, LFA sheep would see costs in that case of only 2.01% on average, and LFA cattle and sheep only 1.61% on average.

5.12.19 It is clear that the critical control points account for the majority of the costs under these two options, comparing them to the same EID implementation option shows that by adopting critical control points the impact on farm business costs is more than halved, although even with CCPs the impact is still significant.

5.12.20 The impact on the profitability of farms has been shown to be variable depending on the option for implementation that is used. The negative effect on profitability that this regulation entails might mean that some farms may see reduced profitability. The following table shows the increase in the percentage of farms with negative net profits as a result of the implementation of this policy.

Table 9 - Increase in farms with negative net profitability

5.12.21 The above table shows that although there will be some increase in farms operating with negative net profits as a result of the regulation, especially if Critical control points are not adopted, any increase is likely to be small.

5.13 Goats

5.13.1 There are around 661 holdings with goats and kids in Scotland which keep 4,182 animals (Scottish Government Economic Report on Scottish Agriculture 2009). As there are less than 160000 goats in the UK there is no need to compulsory EID the new herd, but there is the requirement to individually record the animals in holding registers and movement documents.

5.13.2 It is estimated that approximately 1900 kids are born each year and a similar number of deaths to maintain a stable population. Of the kids it is estimated that almost all male kids (98%) and 60% of females will be slaughtered in the first year i.e. approximately 1500 kids, leaving about 400 for breeding purposes.

5.13.3 This RIA uses the same figure for identifying goats and sheep with conventional tags as £0.15 per tag (£0.30 for two).

5.13.4 This RIA assumes that it takes a similar time to identify a goat and a sheep and therefore uses the figure of 33 seconds to apply a single tag (109 animals per hour) and 66 seconds to apply two conventional tags (54 animals per hour).

5.13.5 This RIA assumes that it takes a similar time to manually read and record an individual goat and sheep and therefore uses the figure of 2 minutes per animals (30 animals per hour).

5.13.6 On the basic assumption that there are 3 animals per holding, this RIA assumes that individual animal identities would always be recorded on movement documents and holding registers.

Option 1

Identification

5.14.1 Under this option the identification costs are estimated to be will be £345 ((1500 x £0.15 = £225) + (400 x £0.30 = £120) = £345.

5.14.2 Using a replacement rate of 5%, and on the basis that a non identical means of identification would be fitted, costs are estimated to be £17 (5% of 1500 x £0.15 + 5% of 400 x £0.30)

5.14.3 Labour rates associated with identification is estimated to be £169 (1500 /109 x £7.97) + 400 / 54 x £7.97).

5.14.3 Therefore the total cost for identifying goats under this option is estimated to be £724

5.14.4 There are no additional costs associated with identifying animals under this option from the current rules.

Individual Recording

5.14.4 400 animals will require to be recorded on an individual level, but it is assumed all 1900 would be. Therefore the costs associated with individual recording of all goats be manual means is estimated to be an additional £504 (1900 individual animals at 30 per hour x £7.97 labour = £504).

5.14.5 Therefore the total cost of option one is estimated to be £ 1228.

5.14.6 The total additional costs associated with identifying animals under this option are estimated to be £504.

Option 2

5.15.1 This option would see all goats double identified (no slaughter derogation) and individually recorded.

Identification

5.15.2 Under this option the identification costs is estimated to be will be £570 (1900 x £0.30). This is an additional £225.

5.15.3 Using a replacement rate of 5%, and on the basis that non identical means of identification would be used replacement costs are estimated to be £29 (5% of 1900 x £0.30). This is an additional £12.

5.15.4. Labour rates associated with identification would be £280 (1900 / 54 x £7.97). This is an additional £111.

5.15.5 Therefore the total cost for identifying goats under this option is £879.

Individual Recording

5.15.6 1900 animals will be recorded on an individual level and therefore the costs associated with individual recording of all goats by manual means would be £ 504 (1900 individual animals at 30 per hour x £7.97 labour = £504).

5.15.7 Therefore the total cost of option two would be £1383.

5.15.8 The total additional costs associated to this option is therefore estimated to be £852