Sunday, February 7, 2010

Is a Fee-Based Food Safety Regulatory System a Good Idea?

An editorial by Dan Flynn at Food Safety News argues that a fee-based food regulatory system, along the lines of the $500 per facility fee included in H.R. 2749 (the House food safety bill whose pending Senate counterpart, S. 510, does not include this fee), is a pragmatic solution to the problem of maintaining a working food safety system even as domestic discretionary spending comes under the axe over the next few years. I tend to agree. The editorial raises one point on which I'd love to see some hard economic data.

Flynn says: "A [regulatory] structure that works would pay a lot of dividends.  Firm, fair, predictable inspections would mean safer food with fewer recalls."

Is there data out there that would let us put a dollar amount on these dividends? Would a functioning food regulatory system, through fewer recalls and greater consumer confidence, prevent enough lost revenue to the industry to make up for the cost of a fee-based system? Fees are a hard sell to an industry that would rather make tax-payers pick up the tab, but I'd wager that any of the major peanut producers would have happily paid a relatively small fee if it could have saved them the massive losses associated with the Peanut Corporation of America debacle.

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