Sainsbury and Asda Merger

Debate between Lord Hanson of Flint and Andrew Griffiths

Monday 30th April 2018 Commons Chamber

[Andrew Griffiths]

My hon. Friend makes an important point—I have dairy farmers in my constituency—and this is one of the issues that I have raised with Christine Tacon, the Groceries Code Adjudicator. My hon. Friend will know that in the last few weeks, in conjunction with the Department for Environment, Food and Rural Affairs, the Groceries Code Adjudicator and the Department for Business, Energy and Industrial Strategy, we have brought forward new proposals on dairy contracts to help exactly the kind of small suppliers that she talks about. In conversations with Sainsbury’s and Asda, both of them talk about the very real relationships that they have with their suppliers—with their dairy farmers. I hope that we can get some assurances to protect those relationships.

[David Hanson (Delyn) (Lab)]

Just to be clear, suppliers will not be squeezed, head offices will stay open and stores such as those in Flint, where there is an Asda next door to a Sainsbury’s, will both be open in two years’ time. Has the Minister sought those assurances from the companies today?

[Andrew Griffiths]

Let me reiterate to the right hon. Gentleman that the matter of stores in the same town will be considered as part of the phase 2 investigation by the CMA panel. It will consider the impact of the merger on individual towns. If it believes that it is anti-competitive, that it will lead to a worse deal for the consumer if the two supermarkets—one being Asda, one being Sainsbury’s—stay open, and if it has concerns, it will force the sale to a competitor.

As my hon. Friend the Member for South West Bedfordshire (Andrew Selous) said, where there is a wider marketplace with a huge number of supermarkets, the CMA’s view may well be that there is no impact on competition in the town as a result of the merger. However, it is clear that this will be judged on a case-by-case basis, to protect the individual consumers in the right hon. Gentleman’s constituency and mine.

department for Environment, Food and Rural Affairs

Debate between Lord Hanson of Flint and Andrew Griffiths

Tuesday 17th July 2012 Commons Chamber

[Mr David Hanson (Delyn) (Lab)]

I support the hon. Member for Montgomeryshire (Glyn Davies) in his request to the Minister today. The hon. Gentleman represents mid Wales and I represent north Wales, and a number of my constituents from the National Farmers Union and from the Farmers Union of Wales have echoed very much the concerns that he has raised. They simply cannot plan their businesses on the basis of a 2p cut in the price of milk already, with the potential for further cuts before 1 August. As he has mentioned, dairies such as Robert Wiseman Dairies are squeezing the dairy farmers of north Wales hard on the price of milk. A number of farmers in my constituency have raised the concern that they have potentially lost, because of the cut to their businesses, between £40,000 and £60,000 per business. No business could take a mid-year hit of that proportion with so little notice without it potentially having an impact on their viability. Farmers in my constituency came to London last week to raise the issue and are seeking the solution proposed by the hon. Member for Montgomeryshire.

[Andrew Griffiths]

I thank the right hon. Gentleman for giving way and agree with much of his speech. Does he share my concern that the contracts that dairy farmers have to put up with mean that they have to live with cuts of 2p, then another 2p, then further erosion, but if they want to get out of them they have to give six months’ notice? Does he not agree that that is unacceptable?

[Mr Hanson]

I am grateful to the hon. Gentleman for raising that issue and the key is to have a code of conduct for the contracts. I know that the Minister had discussions last week about a potential voluntary code and look forward to his updating the House today on his progress. If a definitive decision has not yet been made, I would welcome hearing from the Minister what plans he has to ensure that during the period between now and when the House returns in September he will be able to update Members who have an interest in the dairy industry, as well as Members in general, on this matter. I share the wish of the hon. Member for Montgomeryshire to see a voluntary code at first, but I know that my colleagues on the Labour Front Bench would certainly support regulation through a statutory version of that code if the voluntary form was not successful.