Groceries Code Adjudicator Bill [HL]
Debate between Lord Bishop of Wakefield and Lord Borrie
The Lord Bishop of Wakefield
My Lords, I support the amendment. My commitment to the issues lying behind the legislation goes back a very long way. In terms of suppliers and retailers, it is rooted in the issues of the locality in which I have lived for the past nine or 10 years. This instinct has been reinforced by my experience more widely. Wherever possible, I have been trying to urge us to move forward on this and it is greatly encouraging to see that something is happening at last. At the root of this is the issue of the fairness of the market. Going back many years, when there were lots of debates about how effectively employers and employees were represented in the labour market, the key issues were its fairness and whether the balance of power was too strong in one direction or the other. That is the problem with which we are dealing. Anything that we can do to ensure that the legislation as finally enacted gives the adjudicator proper teeth so that abuses can be addressed. Some of the abuses that have come to my knowledge have been quite hair-raising. I hope that we support this amendment and that we make sure, if it appears that what is required is being ignored, that we allow the adjudicator the possibility of taking other forms of enforcement.
Lord Borrie
It is very useful to have the views of the right reverend Prelate the Bishop of Wakefield. He has attached his name to one or two amendments later, so we look forward to further contributions from him. I agree with my noble friend’s wish to ensure that if recommendations made by the adjudicator are not carried forward, he or she can come back to the Bill to see what other action can be taken, including the possibility of financial penalties.
Addressing a question to the Minister rather than to my noble friend, who proposed the amendment, Clause 6 states,
“the Adjudicator may take one or more of the following enforcement measures … recommendations … information to be published … impose financial penalties”.
I wonder whether the Bill already enables the adjudicator to go from one to the other if the first proposal—recommendations—is not accepted, or is it the Minister’s view that he can do only one of those things and not come back and open up lines of discussion as to whether one of the other measures can be taken later?
The Lord Bishop of Wakefield
My Lords, once again I support the general tenor of the amendments. Some of the same issues that were raised by the noble Lord, Lord Browne of Ladyton, in the previous debate are here. It seems to be about complexity, and the ability to take action swiftly is crucial. The Minister talked about fairness to retailers but it seems to me that part of the issue is getting fairness into the system. There is a clear unfairness to suppliers and it is once again about trying to change the culture and address the question of balance within the market.
I shall give two examples. The first concerns an individual retailer who insisted that a particular supplier of dairy products must, if he wanted to continue to be a supplier across the board of this very large retailer, pay a premium of £150,000. Without that premium the products would no longer be retailed in a very large number of stores within the chain. The supplier refused for two reasons. First, he felt that there was a lack of morality in the demand and secondly, he could not afford to do it. Happily he was switched on enough to be in touch with people who immediately complained that they could no longer get the products. In our marvellous electronic world, he was able to send them down the road to another local retailer. That is one example with one retailer.
The other example, which we all know about only too well, has been a continuing debate in the past 10 years on the issue of milk suppliers and getting a fair price for milk. Here it involves not just one retailer but a series of retailers acting together in their own best interests. I can understand their best interests. Perhaps if I were one of them I might want to push the same line. But in the end, it has the effect of driving suppliers into an impossible position.
First, we need swift action because it soon becomes clear that whatever legislation we produce is effectively weak as it gets pushed back all the time. Secondly, I take the debate about naming and shaming, and costs, but I only have to refer noble Lords to yesterday’s news about Barclays Bank. Whether the management of that bank will survive in their present roles, I have no idea, but it will not do them very much good to find that they have to pay £290 million in fines. I am not suggesting that we are talking about that level of fine here, but unless there are serious mandatory controls, we shall enact legislation that in principle is thoroughly positive and good, but which in practice does not get the market more evenly balanced.
Lord Borrie
My Lords, I am very happy to follow the right reverend Prelate as I agree entirely with everything that he said. He gave useful examples. I attached my name to the amendment tabled by the noble Baroness, Lady Byford, because I was convinced—I think I said something like this at Second Reading—that this provision should be in the Bill rather than there being just a possibility of a statutory instrument being laid at some later stage, with all the delays and question marks that that would involve. It should be in the Bill that there is a possibility of a financial penalty.
The noble Baroness, Lady Randerson, used a word with which I entirely agree, saying that the Government’s approach by not putting the power in the Bill is cumbersome. It is a cumbersome way of going about things. I am so glad that the noble Viscount, Lord Eccles, is here. If I may refer to some of the things he said earlier this afternoon, if this power goes into the Bill, I do not envisage the adjudicator taking a great deal of time thinking about penalties, the amount, and all the rest of it. I use a word most often used in criminal law, which I hope will appeal to my noble friend—deterrence. The possibility of a financial penalty —whether anywhere near that imposed by the Financial Services Authority on the bank yesterday—has a deterrent effect that is extremely important. The adjudicator will not be judged on the amounts of fines that he imposes to prove that he is a good or a useful man in his post—he will be judged as much by the effect of his powers upon the industry.