Food ombudsman plan welcomed

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IT’S taken more than a decade, but a bill to set up a supermarket ombudsman was finally announced in the Queen’s Speech last week, writes Sally Gillespie.

Farming leaders are urging MPs not to “bow to retail bluster at the last hurdle” and to set up a referee with teeth to oversee the Groceries Code.

Local politicians welcomed the announcement of the Groceries Code Adjudicator Bill.

South of Scotland Lib-Dem MSP, farmer Jim Hume, who is his party’s rural development spokesperson, described the bill as “crucial” adding: “The food and drink supply chain has very rarely favoured the primary producer and I welcome this bill as a way to finally iron out those inequalities.”

The bill is aimed at ensuring large retailers treat suppliers fairly – and are held to account if they break the code – and at stopping supermarkets passing on risk and costs to suppliers. Farmers will be able to raise complaints confidentially with the adjudicator.

Ettrick, Roxburgh and Berwickshire MSP John Lamont said: “Ever since the code of practice between food producers and major supermarkets was established, there have been concerns from farmers who felt they were being bullied.

“Supermarkets often use market dominance to unfairly put pressure on suppliers, which was forcing our farmers to take unnecessary risks and to cut costs. They need to be protected and this new adjudicator will be able to do just that.”

The Groceries Code was introduced two years ago to help balance the power of supermarkets over farmers but producers were afraid to complain.

Veteran campaigner on the issue, Borders MP Michael Moore, said: “Over the years, supermarkets have held our local farmers over a barrel and it’s time for this injustice to be tackled. The adjudicator will protect suppliers and farmers from the predatory practices we have seen in the retail marke. This is great news for farmers and suppliers in the Borders and a victory for common sense and fairness.”

But the British Retail Consortium (BRC) is concerned about the cost to supermarkets footing the bill for the ombudsman and says farmers are already adequately protected.

BRC’s food director, Andrew Opie, said: “It’s in retailers’ interests to have excellent relationships with their suppliers. The UK has the most regulated supply chain in the world. The proposed adjudicator is in danger of adding to the cost and bureaucracy of running a grocery business without adding to the strong protection which already exists for suppliers.”

Initial estimates of running costs are £1million a year but he continued: “The truth is no-one knows what the cost might be. Retailers are being asked to write a blank cheque.”

He said: “The adjudicator should only be able to pursue specific complaints from suppliers which have direct relationships with the retailers, and which are related to the Groceries Code. Allowing third party complaints would open retailers up to malicious campaigns and fishing expeditions, at a great cost to all parts of the grocery supply chain.”

But NFU Scotland’s vice-president, Allan Bowie urged: “If we are going to put an adjudicator in place, let’s make sure, once and for all, that he or she can effectively arbitrate disputes, investigate anonymous complaints on the basis of any credible evidence and impose heavy fines where the code has been breached.

“We must also not be hoodwinked by retailers’ complaints about the cost of the adjudicator, nor their threat that the cost will be passed on to consumers. Compared to retailer profit, the operating costs of such a department would be minimal and they can afford it easily; moreover, retailers with an excellent relationship with their suppliers – and they do exist – would have nothing to hide.”