Farmers say new supermarket code must have teeth

Publication of the Competition Commission‘s report into the functioning of the grocery trade has generated a mixed response from the whole food chain.

In particular, its demand for a strengthened Groceries Supply Code of Practice and its recommendation for an independent ombudsman to enforce this code, have elicited the most comment.

The following is a taster of what the industry thinks:

“A strengthened mandatory code of practice backed by a proactive ombudsman is exactly what is required to help develop a framework of improved transparency and fairness in the food supply chain.” NFU president Peter Kendall.

“The Competition Commission’s proposals on the new code and an ombudsman could cost the industry hundreds of millions (of pounds), leading to higher prices for customers which will hit families hard at a time when they are already feeling the pinch.” ASDA chief executive Andy Bond.

“The Competition Commissions recommendations should be used to promote and encourage best practice and bring some long overdue confidence back into the food supply chain. Retailers should have nothing to fear.” Ulster Farmers’ Union president Graham Furey.

“Accountability and transparency are important, but any revised code and ombudsman should not disrupt the business of working with customers by imposing a bureaucratic burden or by creating a confrontational mentality.” Dairy UK director general Jim Begg.

“The TFA welcomes the fact that the Competition Commission is to allow suppliers and primary producers to make confidential complaints which will then be investigated by the groceries ombudsman who will apply a new and enhanced code of practice.” TFA chief executive George Dunn.

“Today’s decision must spell the end of abuses such as the demands for lump-sum payments or enforced promotional costs. However, ultimately we need a complete cultural change in the supermarkets’ attitude to the rest of the supply chain.” NFU Scotland chief executive James Withers.

“We are not sure that the main recommendations will improve the life of the British consumer. We welcome the broadening of the supplier code, but we share the concerns of panel member Professor Bruce Lyons that an ombudsman would be counter-productive and would reduce the benefits of competition.” Tesco chief executive Terry Leahy.

“In the past, the supermarket code of practice proved far too weak and relied on farmers making complaints which then led to them being blacklisted by supermarkets. The new ombudsman must be proactive and ensure that in future there is fairness throughout the food industry.” LibDem rural affairs spokesman Roger Williams.