Supermarket ombudsman: industry reactions

Farming leaders have called on the government to act in full on the Competition Commission’s (CC) recommendation for a supermarket ombudsman.

The NFU said that the new Groceries Supply Code of Practice (GSCOP), published by the CC yesterday (4 August), will only work if it has the backing of an ombudsman.

NFU president Peter Kendall pointed out that the CC’s formal recommendation to the Department of Business Innovation and Skills (BIS) followed many failed attempts to get the major retailers to introduce voluntary measures. He said there was “no logical reason” for the government no to act in full on the Commission’s recommendations and urged action “sooner rather than later”.

“The new code will only work if proactively and robustly enforced, so that the climate of fear that suppliers endure can be eliminated. This can only be achieved through the implementation of an ombudsman,” Kendall said.

Meanwhile, the British Retail Consortium (BRC) rejected the idea that suppliers need protection from supermarkets, pointing out that most supermarket suppliers are "multinational food businesses", which can stand up for themselves.

Andrew Opie, BRC food director, said that consumers would be the ultimate losers from the establishment of an ombudsman, which he dismissed as an unnecessary expense.

“This should be about customers. The last thing needed at any time, let alone in a recession, is a multi-million pound bureaucracy – unnecessarily piling on costs and pushing up shop prices," he said.

Opie insisted there was no evidence to support claims that retailers are unfairly “putting the squeeze on their suppliers” and called on Lord Mandelson to reject the CC's recommendation.