Pundit’s Mailbag — Food Safety Audits
And Government Oversight
Jim Prevor’s Perishable Pundit, January 22, 2007
We received a letter from a third-party auditor warning of a problem with the way the proposed California Leafy Green Handler Marketing Agreement and Marketing Order are structured:
The Pundit was intrigued by this idea and asked a question:
Are you suggesting that the portion of the fee that is collected by the MA or MO should be a kind of voucher to be used with any certified or approved auditing body?
Our correspondent answered quickly:
Our correspondent makes several key points:
A government monopoly loses incentives to keep costs down and service up.
In all likelihood this new audit will just be a base audit — with most major buyers demanding special audits. A private company is likely to be far better able to do the base audit and then add on to it — the Costco audit, the Wal-Mart audit, the Tesco audit, the Aldi audit, the Darden audit, the McDonald’s audit, etc. Dealing with all these auditors is a big expense and substantial inconvenience for suppliers. A system that can reduce this expense and inconvenience is much to be preferred.
He adds a twist to these very valid arguments by saying that we could still keep the auditing mandatory and paid for through an assessment but give people a voucher to use with any “certified” auditor.
The Pundit adds another point: Food safety people who know what they are doing are tough to find and expensive. A government monopoly is likely to wind up understaffed and with unqualified people. As we learned in the Hunts Point scandal, government employees are also not immune to corruption.
Obviously as an auditor, our letter-writer has his own interests at stake when the government is talking about going into the business — but the points our correspondent make are reasonable. We shouldn’t set up a massive new government bureaucracy without more careful consideration of the point and of other possibilities.