Who's profiting from this loss?

The release of figures showing that 37 farmers have applied for compensation of more than £1m for animals slaughtered in the cull has carried with it the innuendo that some of them have been doing rather well out of what is supposed to be a rural tragedy.

Tapping into stereotypes of wealthy farmers, the implication is that some have been inflating the value of their animals so they can make a profit on their loss. The Government, of course, denies it is doing any such thing, but farmers have been left aggrieved by headlines on the amount some of them stand to gain.

And coming on top of claims over the exaggerated cost of cleaning farms affected by the disease, it could create an impression that the escalating cost of the epidemic is not the Government's fault.

Mr Dugdale, who lost 271 cows, one bull and two calves when the disease was found on his farm, at Crathorne near Yarm, is convinced farmers are being made to carry the can for the Government's own inability to eradicate foot-and-mouth.

"I have absolutely no doubt that it is a smokescreen, because the Government's incompetence has been absolutely unbelievable throughout the whole thing," he says. "I don't trust a word they say and when they get themselves into a real hole, they will do anything that they think is going to deflect the flak from them to somebody else.

"But it doesn't matter how much you spin, the virus has no interest in that, it still carries on."

His started work on his herd of Friesian and Holstein cows in 1971, and has spent the last 30 years improving and adjusting bloodlines to get the most out of them and fall in with consumer fashions.

"It takes a great deal of time. From the time you decided to do something it takes three years to actually have that animal come into your dairy herd," he says. "It is a year before it is born and then two years before it calves down and becomes productive.

"For every decision, it is three years before you see the results. I started in 1971 and two thirds of my dairy cows were knocked out in the space of five hours.

"You maybe think something is a wonderful idea, so you try it and wait eight or ten years, and then you think maybe you have gone a little bit too far so you need to fine tune.

"It is a lifetime's work and it is constant evolution. After 30 years, unless you have made a complete hash of it, you ought to be getting somewhere, but you always have to respond to changing circumstances and maybe you require something slightly different."

While he is reluctant to discuss compensation, he says it is in the middle range of figures quoted. An average figure of £1,000 a head would put it at about a quarter of a million pounds. But this is money which has to go back into the business, in some form or another.

He does have the advantage over many other farmers of having split his herd into two, with 130 cows surviving the epidemic so far and providing a base to use for the future.

"The compensation you get is either going to help you go out and buy some more stock, or you have got to try and set something else up, because otherwise you have got no income at all.

"We haven't finally decided what we're going to do. I lost two thirds of my dairy cows at one location, but I have still got another location and I'm very fortunate that I haven't lost everything. I can't believe what it would be like to lose everything.

"I have got a nucleus of animals and it is my intention to develop again from there. However, I'm not just going to go back to where we were before, we have to take this as an opportunity to try and improve what we're doing."

Suggestions that the Government has been trying to deflect criticism over the handling of the epidemic have been roundly rejected. A spokeswoman for the Department for the Environment, Food and Rural Affairs (Defra) says information about the £1m-plus claims was released in response to a specific request.

But she said they were unwilling to give a figure for average pay-outs, despite confirming that £930,400,000 has been paid so far, covering 8,589 cases, an average of £108,000 per case.

"We don't believe farmers have been profiteering, we're not trying to brief against farmers, we're all in this together," she says. "Farmers have received what they are legally entitled to."

But she said the Government was reviewing the amount paid out in compensation, which has already seen the scrapping of the standard valuation tariff, which acted as a guide to valuers.

Despite Defra's protestations, the National Farmers' Union (NFU) said there were fears that someone was trying to deflect criticism over the way the epidemic has been handled onto those who had lost the most.

"It is an insidious way of undermining confidence in the farming community," according to NFU North-East spokesman Rob Simpson. "Farmers are going to be reacting with dismay to this, as they did to the claims two weeks ago about the disinfecting costs."

And he says the figure of 37 farms in line for compensation of £1m or more represents only a small part of the total, and is not out of line with other areas of the economy. "Out of 8,000 farms, if 37 are worth more than £1m that is just 0.5 per cent," he says. "It is a traumatic period for farmers and the farming community certainly has nothing to hide.

"The valuations are carried out by independent valuers employed by the Government and if something was wrong with the system it should have been tackled at the outset.

"Most people in the farming community can see the sort of criticism the Government has come under because of the prolonged outbreak, and some of them may think that the Government is trying to deflect criticism.

"There are bad apples in any industry, and if one or two people have put in extra claims then that is bound to happen. In the vast majority of cases we know that everything has been done properly."

Read more about the foot-and-mouth crisis here.