An incentive scheme, costing $941.7 million, has been proposed offering ex-gratia payment to pig farmers who choose to surrender their licences voluntarily and cease pig farming activities permanently in Hong Kong, the Health, Welfare & Food Bureau says.

The bureau said today the main purpose of the scheme was to reduce the number of pig farms in Hong Kong thereby reducing associated public health and environmental pollution problems. 

At present, there are 265 pig farms in Hong Kong rearing about 330,000 pigs, which supply about 20% of the local fresh pork market. Most of these farms are located in the northern New Territories.

The ex-gratia payment calculation will broadly follow the current formulae for calculating ex-gratia allowances for pig farms affected by land resumption and clearance for public work projects, as approved by LegCo's Finance Committee.

There are two major components in the formulation of the payment - for farm operation and for farm buildings, such as pig sheds and agricultural stores.

A minimum amount payable to pig farmers taking into account the number of pigs raised by individual farms will be set at $450,000, so as to encourage smaller pig farms to close down and surrender their licences, while the highest is $25.45 million.

As the 'Wet-Muck-Out' facilities is a capital-intensive environmental protection facility in many pig farms, the administration has also decided to include them as the farmers' capital investment after deducting the capital grant.

The scheme also provides an $18,000 one-off grant for each affected local pig farm worker and live pig transport worker to ease their immediate financial needs.

A loan of $50,000 will be provided to each transporter who has been transporting live pigs from local pig farms to slaughterhouses to upgrade/convert their vehicles for other business opportunities.

Sector's support

The bureau said pig farming activities generated considerable public health and environmental pollution problems that were difficult to overcome and there was a need to consider whether the sustainable development of livestock farming can ever be realistically achieved.

With the rapid urbanisation of Hong Kong and heightened community concern about public health and environmental issues, the bureau considers it appropriate that the number of pig farms should be gradually reduced.

During past discussions with pig farmers, it appeared that many were prepared to surrender their licences for a reasonable package, the bureau said, adding that over 190 written submissions, representing nearly half of all pig farms, have urged the early launch of the scheme.

On concerns about pork supply, the bureau said that although the number of live pigs produced by local farms would shrink, the number of live pigs imported from the Mainland would increase to fill the gap, depending on market demand. 

The bureau has also proposed to introduce legislation to stop the issue of new pig farm licences, and will freeze the rearing capacity of those pig farms that choose not to join the scheme.