Lib Dems call for supermarket ombudsman

Retailers’ unscrupulous behaviour towards farmers and suppliers is rational and understandable, according to the politician leading the call for a supermarket ombudsman.

Liberal Democrat MP Andrew George, who chairs the cross-party grocery market action group and calls himself quasi DEFRA minister, said the retailers’ approach to dealing with farmers was to be expected given the competitive world in which they operated.

Speaking at a British Retail Consortium fringe event at the Liberal Democrat party conference in Birmingham on Sunday (18 September), Mr George said retailers were often hard on suppliers. But he acknowledged that they had to push them as hard as they could to remain viable.

“I don’t think the behaviour of the supermarkets is due to the fact that they are the product of the loins of the devil,” he told delegates. 

“If they don’t push suppliers but their competitors do, they would lose market share. I understand that their behaviour is rational in that context.”

But Mr George criticised retailers for transferring excessive risks and unexpected costs on to suppliers. While the government did not want to over-regulate the retail sector, it was vital a supermarket ombudsman was introduced to address the impact retailers had on the viability of many farmer suppliers, he said. 

“Retailers can engage and discriminate as they choose, but the grocery code adjudicator will ensure that relationships are regulated.

“We want the adjudicator to uphold the grocery supply code of practice. Farmers have been going out of business at a rapid rate, but supermarkets were posting record profits.

“What we want the adjudicator to do is not simply wait for a complaint from the supplier. That won’t work because there is a climate of fear which means suppliers dare not complain. It needs to be a market-intelligent, pro-active enquiry, otherwise it won’t work.”

Friends of the Earth food chain campaigner Helen Rimmer agreed the ombudsman needed to be given necessary powers if it was to make an impact on suppliers’ lives.

“We want retailers to commit to paying farmers a fair price which is not below their cost of production,” she told delegates.

“The ombudsman also needs “teeth” to protect suppliers. It should enforce the code and should be backed by the power to charge significant financial penalties.”

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