The financial impact of mad cow disease to public budgets in Czech Republic from 2001–2019

Richard Pospisil
Department of Applied Economics, Faculty of Arts, Palacký University in Olomouc, Křížkovského 12, 771 80 Olomouc, Czech Republic

Abstract

Pospisil, R. (2022). The financial impact of mad cow disease to public budgets in Czech Republic from 2001-2019. Bulg. J. Agric. Sci., 28 (2), 196–204

Population health and food safety is one of the main priorities of the agro-industrial complex and the economic policies of governments. This is also reflected in the health safety of the meat in the event of infectious diseases. Food safety policy is linked to public spending by the state, which also takes responsibility for the health of the population. This paper deals with the analysis of the economic impacts of the Mad cow disease (bovine spongiform encephalopathy - BSE) occurrence in Czech Republic, namely the financial compensations to the farmers whose herds had been affected and the costs of animal killing and carcass disposal in the rendering plant. The data were obtained from the Ministry of Agriculture of Czech Republic, the State Veterinary Administration and the Czech Statistical Office. Original scientific research reflects the period from the first occurrence of the disease to the end of 2019. Between February, 2001 and the end of 2019, a total of 1 977 881 cows were examined and 30 cases of the BSE were detected. Consequently, 4243 cows in cohorts were killed and their carcasses were safely disposed of. The total of the compensations in this period reached EUR 8 013 000. Of these, 80.6% (EUR 6 458 000) were compensations for the value of the killed animals, 12.7% (EUR 1 020 000) for the related costs, i.e., killing, safe disposal of carcasses and the examination for the BSE, and 6.7% (EUR 535 000) for the losses due to non-materialised production. The costs associated with the payment of compensations are therefore significantly lower than if the real effects of the disease on the health of the population were affected. The fact that in the last 10 years the disease has not occurred in the Czech Republic corresponds to the improving situation in EU countries, so the Czech Republic has been recognised as BSE negligible risk country.

Keywords: financial compensation; mad cow disease; bovine spongiform encephalopathy; BSE; cattle; infectious diseases; World Organization for Animal Health

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