Fees for seed testing, seed certification and associated seed functions: consultation

Part II - Background to Services Provided by Scottish Government

1. Introduction

Crop Certification Schemes exist to protect farmers buying the seed, to ensure that the product they receive meets certain quality standards. The current UK Cereal Scheme incorporates several quality control mechanisms, including official testing to ensure that the seed meets prescribed standards for germination, freedom from weeds, and varietal identity and purity and crop inspections.

The Scottish Government has five Scottish Statutory instruments which legislate for the marketing of Seed Crops.

• The Beet Seed (Scotland) (No 2) Regulations 2010
• The Cereal Seed (Scotland) Regulations 2005
• The Fodder Plant Seed (Scotland) Regulations 2005
• The Oil & Fibre Plant Seed (Scotland) Regulations 2004
• The Vegetable Seed Regulations 1993

These regulations are part of an EU-wide framework, which ensures that seeds meet the same quality standards wherever they are sold in the European Union.

2. Seed Certification

Science and Advice for Scottish Agriculture ( SASA) are a division of the Agriculture and Rural Economy Directorate, within Scottish Government, and act on behalf of Scottish Ministers as the Certifying Authority for Scotland. Responsible for the certification of beet, cereal, fodder, oil & fibre and vegetable seed, they are situated at Roddinglaw, just to the west of Edinburgh.

Staff at SASA undertake the crop inspection for certified seed, and provide various training courses and examinations, which allow the industry to demonstrate their knowledge and expertise. If successful, an individual from the industry can obtain a licence to undertake crop inspections and / or seed sampling. Officials from the Certifying Authority, Agricultural Delivery ( RPID) team and the Official Seed Testing Station ( OSTS) for Scotland, are responsible for the official supervision of all licensed persons, crop checking and check sampling for at least 5% of all crops and seed lots.

Seed certification at SASA has undertaken a number of cost saving measures over the last five years, including the amalgamation of the cereals and non-cereal sections, and the introduction of on-line applications.

Cereals

The majority of seed certified in Scotland is cereal seed. Table 1 below provides the species and the numbers that have been certified by the Certifying Authority over the last five years.

Table 1

Number of Applications

	2012/13	2013/14	2014/15	2015/16	2016/17
Spring Barley	1233	1089	989	934	1067
Spring Oats	131	92	122	138	143
Spring Triticale	1	0	0	0	0
Spring Wheat	48	33	36	37	31
Winter Barley	268	233	255	232	264
Winter Oats	43	44	36	42	57
Winter Triticale	2	1	1	1	1
Winter Wheat	449	468	454	518	521
Total	2175	1960	1893	1902	2084

Non-cereals

The volume of non-cereal seed grown and/or certified in Scotland is small (see Table 2 for details) This consists mainly of field peas and field beans, occasional oilseed crops and Scots Timothy. Crop inspections are generally carried out by officials from the Certification Authority. Due to the low number of non-cereal crops certified, the fees charged are based on those calculated for cereals.

Table 2

Total area of Non cereal crops certified in Scotland over the last 4 years.

Area of Seed Crops Grown in Scotland

The total area of seed crops grown in Scotland has fluctuated over recent years (which is reflected in Table 3)

Table 3.

Total area of Cereals grown in Scotland over last 5 years.

Costs

Last season (2016/17) seed certification operated a small surplus ~3%. This was due in part to higher crop inspection income than budgeted for resulting from an increase in official inspection fees, because of a higher number of plot failures than anticipated. The need for official inspections has not been required in the current seed certification season 2017/18, so no surplus is anticipated.

With inflation beginning to creep up, it would be prudent to apply an across the board inflationary rise for most costs. January's CPI figure has been calculated at 3%, and this will be added to all seed certification costs, including training courses and exams, but will exclude any online seed lot and crop entries where we propose to pass cost savings on to our online users. ( Annex A & B)

The alternative would be no price increase, but this is likely to leave the Scottish taxpayer having to subsidise the industry using these services.

MySEEDS

The Certifying Authority ( CA) are encouraged by the level of uptake of MySEEDS by the seed industry, ( Table 4) and having seen early efficiencies last year, were able to propose that the fees for on line applications should remain unchanged. All other services increased by the then CPI of 1.8%. It was acknowledged that the differential between online and paper applications was small, however, this year we are able to propose that fees for online applications are reduced by 5%. This increases the differential in order to both pass on savings being realised, and hopefully encourage businesses that have not yet used the online facilities available through MySEEDS to consider it. ( Annex A)

Table 4

MySEEDS

Crop Applications

applied for:	Paper forms	MySEEDS	Total
1/7/2015 - 30/6/2016	590	386	976
1/7/2016 - 30/6/2017	294	744	1038

Seed Lot Applications

applied for:	Paper forms	MySEEDS	Total
1/7/2015 - 30/6/2016	1210	745	1955
1/7/2016 - 30/6/2017	443	1677	2120

Number of MySEEDS registered companies: 30

Possible Costs Savings to be made by Using MySEEDS

A business growing 200 Ha of a cereal seed crop and certifying 1500 tonnes the annual saving through use of MySEEDS could be £246.50.

Signing up to use MySEEDS is straight forward and support can be provided by the Certifying Authority staff if required. Please e-mail any requests to cereals.myseeds@sasa.gsi.gov.uk; if you would like to find out more about using MySEEDS.

3. Seed Testing

The Official Seed Testing Station ( OSTS) for Scotland charge for four distinct areas-

• supervision of licensed seed testing stations;
• checking of certification samples tested at an Licensed Seed Testing Stations ( LSTS);
• testing of seed for statutory purposes and;
• training and examination of Seed Analysts and Laboratory Managers

Supervision of a Licenced Seed Testing Station

There are four Licensed Seed Testing Stations ( LSTS) in Scotland that are supervised by the OSTS. Article 2 B of the Marketing Directives ^[2] allows the seed certifying authority to grant a licence that permits a seed testing laboratory to undertake the statutory testing of species for which they demonstrate competency.

To maintain a seed testing licence, the laboratories performance is monitored by the OSTS. The Marketing Directives require that at least 5% of all samples tested for certification purposes are check tested. As well as checking the samples, the OSTS is responsible for ensuring that -

• the analyst-in-charge has passed all necessary official examinations and maintains the necessary skills and competencies for the technical management of the LSTS;
• all analysts have passed official examinations and maintain their technical competency;
• the laboratory and the equipment meets and is maintained to a satisfactory level for the purpose of seed testing and;
• the methods used for statutory testing of certified seed are in accordance with those prescribed by the International Seed Testing Association ( ISTA)

The OSTS fulfils these requirements by visiting each LSTS twice per year to audit the laboratory against the requirements of the Licence and to collect check samples. The check samples are tested at the OSTS and results compared to those of the original certification sample tested by the LSTS. Where discrepancies arise, the LSTS and OSTS will retest the samples. All results are reported back to the laboratory as part of the audit report. The OSTS provides support to correct testing discrepancies and non-conformances identified during the audit. Support is also provided by annual proficiency testing and LSTS workshops.

Proposal to increase the current Licence of a Seed Testing Station

The current Licence fee charged to undertake this work is £1,650 per annum. The licence fee is based on staff time plus the cost of travel and subsistence. The cost of providing this service for period 1 July 2016 to 30 June 2017 was £7019 compared to income £6600, 94% cost recovery. ( Annex B) Scottish Government propose to increase the fee for a Licensed Seed Testing Station by 3.0% (Increase is in line with CPI as of 16 January 2018), which will take effect as of the 1 July 2018.

Through put

Legislation requires the OSTS to check test at least 5% of all statutory samples tested at the licenced seed testing stations. These samples are drawn at random on a bi-annual basis by the OSTS.

For every statutory seed sample that an LSTS tests, they are required to pay a 'through put' fee to the OSTS. The fee covers the cost of testing the check samples including retests. The current throughput fee is £7.63. ( Annex B)

Proposal for the Through Put fee to remain status quo

Last season harvest was a good one with very few problems for seed testing and therefore the proposal is to leave the through put fee at £7.63. Another reason for not increasing this fee is that the OSTS is proposing to introduce a new method of charging from 2019/20.

It is anticipated that it may bring about some savings to the LSTSs. More details of this proposal will be available in the Spring 2018.

Seed Testing Fees

Seed testing costs are heavily influenced by harvest conditions and quality of seed. The cost recovery for years 2012/13 to 2016/17 are provided below. Figures show the reduced recovery due to additional staff time required for testing and assessing each sample due to the poor harvest and quality of seed in 2012 compared to the good harvest and high quality in 2016. Even with increases to fees in 2012 (20%), 2014 (5%), and 2016 (1.7%) there is considerable variability in cost recovery between years. The average cost recovery over the four years presented is 87%.

National % Cost recovery figures since 2012-13 to 2016-17

2012-2013	2013/12	2014-15	2015-16	2016-17	Average
79	No figure	88	85	97	87

Proposal to increase seed testing fees

Given the difficulties of the 2017 harvest and the resultant quality of seed it is predicted that cost recovery for review of 2017/18 year will likely fall between 85% and 90%, even when taking in to account the 1.8% increase from 1 July 2017.

The Seed analysts at SASA are extremely skilled and trained to a high standard. For a Seed Analyst to become fully qualified it takes a minimum of 5 years. They are required to pass examinations covering six UK Proficiency in Seed Testing Divisions across a range of species. A recent re-grading of seed Analyst, highlighted the fact that staff in the seed testing laboratory were graded incorrectly, this re-grading increased the analyst rate by 17%. SASA and the OSTS are aware of the impact that an increase in this size can have and are managing to reduce the impact of cost of regarding through improvements to the processes.

Taking into account the cost recovery of seed testing for the last five years and the re-banding of seed analysts, it is proposed that seed testing fees are increased by 8% to ensure full cost recovery in 2018/19 year.

Please see ( Annex C) for full details of seed testing fees.

Scottish Government's Policy on Fees & Charges

The fees for seed testing, seed certification and associated seed functions are reviewed annually, to ensure that if any changes are required, they are implemented as far as possible that year and not allowed to accumulate over a number of years, resulting in large increases.

A recent review performed by the Scottish Government policy team highlighted that the fees for seed testing are not making full cost recovery.

Scottish Government's standard approach to setting charges for public services is full cost recovery, in doing so it avoids unnecessary public expenditure. Charging also provides an incentive to use goods and services economically, efficiently and effectively.