Our plan to get supermarket watchdog fighting for farmers
© Rex Features The supermarket watchdog is not working. Suppliers are still dealing with unfair buying practices and the majority of farmers, being indirect suppliers, have no chance of redress for malpractice. The groceries code adjudicator (GCA) is expected to be reviewed next year, but the call for an overhaul is already growing.
What, then, needs to change? To tackle this question, Farmers Weekly has gathered a team of food chain experts – each working on issues relating to power in the supply chain. Together, they have identified critical weaknesses in the adjudicator’s role and the groceries code. Importantly, they have put forward key changes to ensure a fairer deal for farmers.
See also: Opinion: Make weak retailer watchdog the farmer’s champion
Our expert panel |
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| Chris Mallon | Tom Lander | John Armour |
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Director, National Beef Association |
Food chain adviser, NFU |
Food policy manager, NFUS |
| Sian Edmunds | Duncan Swift |
Andrew George |
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Solicitor and litigation adviser for food, farming and land and contentious trust team, Burges Salmon |
Chartered accountant, licensed insolvency practitioner, head of food advisory, Moore Stephens |
MP, chairman of Grocery Market Action Group. Former Lib Dem shadow Defra minister |
Does the groceries code adjudicator (GCA) have the tools to tackle unfair practice in the supply chain?
Top priorities to ensure fairness for farmers
Our panel argues:
Upgrade the adjudicator to ombudsman or strengthen it with these changes:
- Extend the groceries supply code of practice (Gscop) and adjudicator’s remit to include indirect suppliers, including farmers and growers
- Better resource the GCA to the level originally recommended
- Give the GCA Powers to proactively look for evidence of code breaches
Other ideas and suggestions from the panel:
- Collaboration between the GCA and Competition Commission to look at fair pricing
- Extend Gscop and the GCA to cover the food supply chain beyond retail and into procurement and the food service industry
- A “fairtrade” certification role for the GCA in addition to its adjudicator role, so good buying practices could be rewarded and consumers could be sure a retailer treated its suppliers fairly
- A change in Gscop to take account of the different ways of doing business in different commodity sectors
Tom Lander: For part of the supply chain, yes. The weak point is that it does not cover indirect suppliers and so leaves primary producers at liberty to unfair trading practices of intermediary suppliers.
Duncan Swift: No. The GCA role was designed to fail because it required suppliers to come forward with evidence, which for most is an uncrossable threshold. The GCA role was treated from outset by the government as part-time, non-urgent and a shadow of the competition commission’s recommendation for an ombudsman.
John Armour: No. The fact that the adjudicator can’t proactively investigate malpractice leaves a massive gap in its powers.
Sian Edmunds: It is a good starting point but not the whole answer – its powers are limited to the very largest groceries retailers and it relies on “whistleblowing”, despite fear among suppliers.
Andrew George: Of course the GCA needs more powers: 1. To investigate the impact of supermarket purchasing practice on indirect suppliers. 2. To make enforceable “directions”, not just recommendations. 3. To fine back to when the code was first introduced in 2008.
Chris Mallon: No – it does not have the necessary remit to investigate the imbalances we see. Primary producers need their confidence in the supply chain to be rebuilt and to do that we need an ombudsman that can investigate and challenge all of the supply chain.
What needs to change so farmers are protected?
Chris Mallon: The GCA needs additional legislation allowing it to investigate malpractice at the start of the supply chain.
Tom Lander: A review of what rules are appropriate for all commodities, so the groceries code (Gscop) can work throughout the whole supply chain. Should Gscop also apply to public bodies or the food services industry?
John Armour: Increased resources to proactively investigate malpractice.
Duncan Swift: Upgrade the GCA to have ombudsman-equivalent powers and resource it at the level recommended by the Competition Commission in 2008 (£4m as opposed to its current budget of £800,000).
Sian Edmunds: I agree with Duncan regarding an upgrade to ombudsman, plus appropriate funding.
Andrew George: Tackle this weakness: indirect suppliers can provide tip-offs that retailer X has breached the Gscop but the result of a GCA investigation likely wouldn’t trickle back to benefit them. This heightens the risk of collusion between the retailer and direct supplier/ processor.
What kind of body should tackle abuse?
Duncan Swift: An ombudsman with full powers to monitor, investigate, arbitrate, guide and report. An ombudsman could sample 20-30 supermarket-supplier relationships at a time without needing a supplier complaint – so no risk to whistleblowers.
Andrew George: The world is watching what is happening in the UK. Scrapping what we have is illogical – we need to build on the foundations.
Tom Lander: The GCA is the correct body. However, it is an office of three people. If its remit was extended it would need much larger resources and many questions need to be answered, such as, how will it be financed? What rules apply? Are the rules appropriate for all parts of the supply chain? Will it cover just UK farmers?
Sian Edmunds: An ombudsman or GCA with much wider powers of investigation, better funding and a wider remit to consider all methods of supply and not just the top retailers.
John Armour: A GCA with a larger budget, team, wider access and a focus on monitoring patterns of behaviour to inform evidence gathering.
Chris Mallon: The GCA with an extended remit to cover the primary producer/processor relationship.