5 January 2001

Assurance court cases a waste of farm cash

FARMERS money will be spent "needlessly" if assurance scheme organisers become embroiled in legal action to prove they are not anti-competitive, it is claimed.

Jonathan Tipples, chairman of the Assured Combinable Crops Scheme, issued this warning after the Federation of Small Businesses lodged a complaint with the Office of Fair Trading.

Discrimination

The FSB claims that farmers are forced to join schemes if they wish to sell their products to large retailers, thus discriminating against those who do not join.

But Mr Tipples points out that this accusation against his scheme was rejected last year by the EU Commission and says further action will only bleed members subscriptions.

"Thousands of pounds of members money was spent on the EC case and it would be very disappointing if we had to get involved in costly procedures again," he said.

Mr Tipples dismissed federation claims that red tape surrounding assurance would cost farmers £3000, saying independent research put the figure at a tenth of this.

He said he was "perplexed" by the renewed action for since the EC case a number of competing assurance schemes had sprung up, further weakening any argument of anti-competitiveness.

Widespread concern

But to back its argument the FSB draws attention to a Better Regulation Task Force report which found "widespread concern" about the benefits of the schemes to farmers and consumers.

The FSB is calling for all the schemes to be suspended and for the development of a single scheme protecting consumers and "creating equal trading terms" for suppliers.

Mr Tipples said the case was factually incorrect and did not believe it would stand up to scrutiny. But he admitted that the cumulative effect of complaints could damage assurance schemes.

"Mud sticks, and I dont welcome this," he said.