Official report into botulism scare slams Fonterra's food safety culture; says attempt to save NZ$150,000 caused crisis; says MPI crisis response incoherent, confused

Official report into botulism scare slams Fonterra's food safety culture; says attempt to save NZ$150,000 caused crisis; says MPI crisis response incoherent, confused
Front page of official report into Botulism scare

By Lynn Grieveson

An official report into Fonterra's botulism scare has slammed the Cooperative's poor food safety culture, saying an attempt to save NZ$150,000 contributed to the episode. The report also criticised the Minstry of Primary Industry's (MPI) response as incoherent and confused.

The Government responded by saying reforms of MPI had already been started, while Labour called for Food Safety regulation to be pulled out of the MPI 'Super Ministry'.

The report of an independent inquiry headed by Queen's counsel Miriam Dean said that, between the breaking of a torch at Fonterra's Hautapu plant in February 2012 and the final notification by Fonterra in August 2013 of Clostridium Botulinum in whey powder processed at the plant, "numerous people made decisions that, one by one, added their small contribution to the building momentum of events."

"Sometimes, those events seemed to take on a life of their own, but they were entirely avoidable – if a strong food safety culture had thrived in the workplace," the report said. 

By its decision to rework, rather than downgrade, the potentially contaminated whey powder concentrate after the lens fragments from the broken torch fell into it, Fonterra hoped to recover about NZ$150,000.

"The cost to the company and the reputational damage for New Zealand magnified this figure many times over," said the report, which was released on Tuesday.

'Sad indictment'

Labour's Primary Industries spokesman Damien O'Connor described the report as "a sad indictment", adding that "the culture, right from the farm through to the marketplace has to improve."

Food Safety Minister Jo Goodhew and Primary Industries Minister Nathan Guy released a statement saying the report showed MPI "took the correct decisions in putting consumer interests and public health first, both in New Zealand and overseas, by adopting a precautionary approach” (even though the so-called " botulism scare" turned out to be a false alarm).

However, the Dean report found that the ministry "had no single, coherent (or reviewed or rehearsed) crisis plan for a food incident that it could implement straight away after receiving notification of Clostridium. botulinum" and "should have had better-documented decision-making processes, used more rigorous science-based risk assessment, and co-ordinated better with the industry to avoid unnecessary confusion among consumers and others."

As well as describing the length of time it took to trace the affected product as a "seriously deficient effort", the report slammed Fonterra for a workplace culture that "exhibited an entrenched 'silo' mentality that robbed the company of some of the cohesion so vital in an organisation of its size."

"Communication, both within and between parts of the organisation, was often unclear – symbolised most starkly by a manager’s unwitting authorisation of Clostridium botulinum testing. And there was also a lack of adequate escalation procedures to deal with possible food safety problems," the report said.

"A food safety programme and a food safety culture are entirely different. One is concerned with documentation and processes, the other with employee behaviour and a top -to-bottom commitment to putting food safety first."

'Fonterra was not ready'

"The ill-prepared inevitably pay a heavy price in a crisis. Fonterra was not ready for a crisis of this magnitude. It lacked an updated, well rehearsed crisis plan to implement, as well as a crisis management team that could spring into action," the report said.

"The ministry also lacked a single, coherent food incident plan to implement straight away."

Goodhew said MPI was already working on a better response model and plans for regular exercises and simulations.

“MPI has already better aligned its structure, provided greater clarity on food safety responsibilities and accountabilities to key players, and put in place new governance processes," she said.

“A Food Safety Law Reform Bill is being developed for introduction in 2015, and a Food Safety and Assurance Advisory Council is meeting quarterly. Working groups with industry representation are underway focusing on traceability and capability in the dairy sector. A Food Safety Science Centre is being established, and MPI has increased its presence in key overseas markets, including China,” Goodhew said.

Guy said MPI would receive NZ$7.9 million over four years "to strengthen its core food safety regulatory and operational capability."

'Break up MPI'

However, Labour called for a completely independent food safety authority, with O'Connor saying that was "the only way that we can ensure the very highest levels of food safety and an independence that reassures our customers in the international marketplace."

"The super-ministry that was formed by the National government is nothing more than a super muck-up, and their responsibilities for food safety have clearly been compromised," O'Connor said.

"John Key's been out there selling our safe food around the world, Nathan Guy hasn't had a ministry that's either capable or resourced well enough to ensure that safe food gets to the customers," he said.

“MPI should never have been allowed to take over the old food safety authority. The roles are completely different. MPI works with the industry whereas an independent food safety agency should critique the industry’s standards. The Government must take food safety out of MPI and make it an independent agency that is unafraid to challenge the big fish in primary industries."

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

13 Comments

Comment Filter

Highlight new comments in the last hr(s).

The food scare rubbish AGAIN?

Fonterra tested the product, it was decided that it wasn't botulism - it was then proved it wasn't botulism and could not have been botulism.

As for "running a business for profit (vs food safety)"  the custoemr gets as much food safety as they are paying for.   same as any business.

Just a bunch of report writers, giving themselves free passes and proving they have no idea what is involved in supply of real goods.

Now we're going to have even more bullshit regulations and complainace costs, more expensive gear that we're supposed to put on farm.... and what's to bet even less revenue to do it from.   Why bullshit regs?  Because it's not on farm that caused a problem...but that's where you can sell a bunch of stuff to.

Cowboy your right in that we the shareholder/suppliers will pay for this off our bottom line. Reading the report I gotta say that it was one hell of a f......up and really shows how high risk the food game is.  
It also shows how difficult it is to run a huge operation like Fontera efficiently and explains to me why we arent seeing the economies of scale reflected in our payout/dividend that we were all lead to believe we would get, looks like small like Tatua is the way to go!!!!!!.

I used to work security - bodyguard stuff.   _That's_ high risk (actually high Threat).

And it's very clear there, the customer gets what the customer pays for.

He's want to only pay for Jo Bloggs standing man with a dog.  That's what the customer gets.
If it results in their death then that's just the way it is.

Government and customer can't keep letting Fonterra sell off product at the lowest price to get sales volume - then turn around and say "you must have the worlds best standards".
It just isn't physically possible.

The Farmers have been telling government and Fonterra/Dairy Co-ops this my whole life, and I iterate that every time there is an inspection - Today at 10am there is going to be a physcial inspection of my creek fencing.  Fencing paid from my own pocket, that adds nothing to the product value, that is on my (leased) land, and yet I'm expect to attend and supply my staff -for-free-,  and there is absolutely no cost recovery at Fonterra's end of the process.

And Fonterra say they're huge - but they have the lowest profit margins of the dairy giants, and the lowest payout against cost of production.  Yet they claim to be biggest !  and they claim to be best !!   Yet they pay the worst??  And now getting held to task to "profit first" ...well it's not showing up here that's for sure...so show me the money!    Where is this "economy of scale"   where is our farmers profit so we can invest a sensible portion into system improvement?

Wairarapa Farmer Stephen Hammand has been charged by Wellington Regional Council for cleaning a drain with his digger. Apparently he faces two years jail or 300,000 dollar fine. The Hammonds are a very highly  regarded Wairarapa farming family. I personally think this is digusting. WRC 's tatics are to sue first and ask questions later.They should change their name to Wellington Regional Gestapo.

..that's what they do.

that's the way it has always been done.

What do you think is going to happen when all the fenced off, weed invested drains are going to need cleaning??

exactly.its called maintainance,and good practice to ensure field tiles/novaflow pipes work .
silted/weed infested drains slow water progress and result in more flooding/water logged soils.
somehow waterways of all descriptions have become "tapu" and no one can touch them for fear of being labelled enviromental detroyers.
rumour has it that in CHCH prior to the quakes many urban waterways were not allowed to be "maintained",which contibuted to some of the flooding issues they have faced since.

That exact lack of cleaning is what caused flooding through Fielding in the 2003/2004 floods.

What also happens is the weed and silt breaks free in clumps and catches with the logs/sticks/trash that catches against colverts, trees and bridges, then the culverts and trees come loose from scouring and extra pressure, creating access issues AND more damage as it goes downstream.
- -
So we've got council owned drains that we aren't permitted to be cleaned (without paying our overlords)

More refrigeration that isn't needed to keep up with the Joneses in other countries.

Science experts and lawmakers who think that a "culture of food safety" can be created for free.

MPI who think that, even though NZ farmers get paid least in the world (vs local costs and count subsidies and similar options),  and Fonterra's product is sold at open auction, for only as much as the buyer feels like they -must- at a minimum pay...and call this "NZ qualtiy premium"

- -
Chinese and other foreign operators who are _increasing_ margin spending and increasing loan books with cheap loans and aggressive NZ spending.

While NZ citizens are facing overly high interest rates when they compete, and RBNZ says they won't drop the interest rates because it might create inflation 
 

I think what you are looking at is mud. I think the problem arose as they mistook what WRC classified as a stream as a farm drain. Which begs the question how can silt of the stream be removed so the farmer can unblock tile drains? Or does he have to let his land revert to swamp, and the farms and town upstream of him? These people aren't cowboy operators. The Hammonds are generally regarded as the best Dairy farmers in the area, And likewise the contractors who did the job.

Answering my own question . The incident breached the Freshwater plan and Resource management act Section 13(1) prohibits work on stream beds unless it is carried out under a rule in the Plan or under resource consent.
So i take it from this the work could have been done legally with a resource consent. So if you don't pay the WRC for a resource consent they will take you to court or fine you alot more. I still think my Gestapo comment is fair, these people have too much power. Roll on Supercity yippee we can't wait!

resource consent?

It's standard maintainance activity for drains and small streams.  Otherwise they silt up and cause flooding and disease.

don't need consent for routine required maintenance activities.

the old maxum
"sometimes it is easier to ask for forgiveness than permission.."
obviously doesnt apply here.!

What annoys me is that they do a write up on the guy and make him look like a criminal, when he is one of the top dairy farmers in the area. I think it's bully boy tactics by WRC. They are difficult to talk to they won't commit to anything, we have had to get consultants in the past and get things in writing.