A new micro-abattoir in southern New South Wales is set to benefit local producers ‘from paddock to plate’ and improve animal welfare, but some fear it could become a failed venture at the expense taxpayers.
- Farmers in southern New South Wales want a micro-abattoir to save their animals traveling hundreds of miles for processing
- The local council took ownership of the facility, securing over $2 million in government funding
- A ratepayer group has raised concerns that council may not have followed proper procedures
The Murray River Council is constructing the $2.2 million cooperative-run treatment facility in Barham, which is fully funded by the state and federal governments.
This decision responds to a call from farmers, who have struggled to get their animals processed in the region due to the closure of slaughterhouses in recent years.
But some fear the micro-abattoir is owned and operated by a council that is already under investigation by the Office of Local Government (OLG) over its dealings with another private company.
In 2018, the Murray River Council spent $1.2 million on land and loaned Murray River Energy $880,000 for an ethanol plant project that never came to fruition.
What is a micro-abattoir?
The micro-abattoir project was started by a small group of farmers who planned to own and run the facility as a local cooperative, the Murray Plains Meat Cooperative.
“It’s the best solution we can find,” said Lauren Mathers, president of the cooperative and producer of free-range pork.
“Not just for ethical reasons, but also for profitability on the farm and just to have this service locally.”
At the moment, the products from his farm have to travel more than 200 kilometers to be killed in Benalla.
Murray River Council new projects manager John Harvie said the 13m by 25m micro abattoir would be capable of handling around 25 small animals a day, or five to seven cattle.
It will have the capacity to process pigs, sheep, goats, cattle and poultry, supplied by 29 cooperative producers in the region.
“Initially, this will create five jobs, rising to about 15 once the facility has achieved accreditation,” Mr Harvie said.
The Murray Plains Meat Cooperative initially applied for government funding for the project, with the help of the council.
However, Mr Harvie said the council had been told by the NSW Regional Department that funding would be difficult to secure due to the co-op’s lack of business and financial history.
He said the ministry advised the council that it should become the project manager and owner of the micro-abattoir.
The development process raises questions
Council had previously rejected ownership of a micro-abattoir, but in a confidential meeting councilors voted to overturn that decision.
At a subsequent council meeting, a councilor said his concerns about the ownership of the micro-abattoir have been alleviated after a discussion with the owner of Canowindra’s micro-abattoir, Tablelands Premier Meats.
Tablelands Premier Meats then won the tender to build the Barham micro-slaughterhouse, but Mr Harvie said the company had not advised the council on the project before his appointment.
“I have to say when the council got involved there were very few … micro abattoirs operating anywhere in Australia,” Mr Harvie said.
The land purchased for the micro-abattoir was also sold by a member of the cooperative’s board of directors who was also an advisor at the time.
Mr Harvie said the adviser was not involved in any discussion of the micro-abattoir.
Ian Wall, a member of the Riverina Ratepayers Group, said the group were concerned the board had not followed proper procedures and that his track record gave him little confidence in handling the project properly.
Requests for public access to government information revealed there was no direct evidence that the NSW Regional Department had suggested the council owned the facility.
However, Mr Harvie said that advice was given verbally during a conference call.
As part of the GIPA application, the council released evidence of a conference call between state government departments, the council and the co-op, as well as a letter, dated after the telephone call, in which the Murray River council proposed the council ownership option.
The NSW Regional Department did not comment when asked if it was advising council ownership, but said ‘the project had undergone a rigorous multi-stage assessment process’ before the granting of any funding.
Should municipalities own slaughterhouses?
It was once common for councils to own slaughterhouses, and many still own local sales yards.
However, over the years many council-run slaughterhouses have failed, including one Mr Harvie was previously involved in, Mudgee Regional Slaughterhouse.
It was the last local government-owned and operated slaughterhouse in the country before it went into receivership in 2003, with debts exceeding $10 million.
Mr Harvie said a micro-slaughterhouse was a very different business model, with significantly reduced overhead and secure supply from co-op members, ensuring the facility was not subject to market fluctuations.
Ms. Mathers said she would like to see her business model and board involvement replicated in other regions.
“With that comes food security, jobs, animal welfare and meat quality,” she said.
“It takes away all that reliance on big business and slaughterhouses that are now mostly internationally owned…you’re really empowering local economies.”
Who benefits from a board-owned co-op?
Critics of the council argue that local government should not take over private industry companies.
Members of the micro-slaughterhouse cooperative are not listed on the stock exchange and, with the board planning to transfer ownership to the Murray Plains Meat Cooperative after five years, Mr Wall said greater transparency was needed.
However, Mr Harvie said the co-op has been very open, inviting members of the community to attend their annual general meeting.
He said the profits from the micro-slaughterhouse would go back to the cooperative for running costs and were not divided among the members unless they became “extremely successful”.
The councilors agreed that no ratepayer funding would be earmarked for the project and that the only income the council would derive would be annual rental fees.