Groceries Code Adjudicator Bill [HL]

Baroness Harris of Richmond Excerpts

Thursday 28th June 2012 Grand Committee

[The Deputy Chairman of Committees]

I remind your Lordships that if this amendment is agreed to, I cannot call Amendment 46 because of pre-emption.

[Baroness Byford]

I shall speak to Amendment 46, which is in my name and that of the noble Lords, Lord Borrie, Lord Knight and Lord Grantchester. Here we come to the crux of the Bill. I am sure that the Minister has gathered that there is great support for the Bill. A couple of colleagues do not feel that way, but the majority of us want the Bill to succeed. I tabled the amendment because I felt that if the adjudicator has to go back to the Secretary of State, that will delay things. Briefings from the Food and Drink Federation, the NFU, the Federation of Small Businesses and the CLA all support the adjudicator being able to impose fines.

To cite the CLA’s brief, it believes that it should be the sole responsibility and a significant power of the adjudicator to impose financial penalties on large retailers where it is clear that there has been a serious breach of the groceries code and where the other two enforcement actions—making recommendations and requiring information to be published by a large retailer—are inadequate in relation to the nature and size of the breach. Indeed, it may very well be the case that a supplier will not be able to continue unless there is financial redress for the damages caused by the infringement. It believes that the Bill must make it clear that the adjudicator retains the power to impose financial penalties and that awards to those suppliers affected by the breach of the code by large retailers must come from the proposed consolidation fund.

My noble friend has just explained, but I reinforce my concern about delay if the Bill remains as drafted. One of the problems of suppliers is getting paid for things that they have supplied. I go back to the earlier comment of my noble friend Lord Howard of Rising when he said that it is up to the person who supplies to go away. The arrangement that I heard of this morning was done retrospectively. The contract had been agreed, the whole supply had been sold, so they could not say, “No, you cannot have it”, because they had already had it but were changing the ground and asking for a reduction in the agreed payment. They could not take the goods back, because they had been sold.

I am happy to support the lead amendment in the group, but if the Bill is to succeed, it must give the adjudicator the chance to impose financial penalties. Clause 9(1) clearly states, “The Adjudicator may”—it does not say that it must—

“enforce through imposing financial penalties”,

but only if it goes back to the Secretary of State. Is what is proposed the norm or have we taken a new step? Why is there that reluctance to allow the adjudicator to impose fines?

To go back to our earlier debate on appeals, if some form of appeals system is strengthened and if the amendment we debated earlier would assist, the requirement for it to go back to the Secretary of State would be even less needed than under the Bill as it stands.