Groceries Supply Code of Practice

Debate between Ben Lake and David Jones

Monday 22nd January 2024 Westminster Hall

[Ben Lake (Ceredigion) (PC)]

It is a pleasure to serve under your chairmanship, Mrs Murray. I thank the hon. Member for Neath (Christina Rees) for securing this important debate and the petitioners for bringing it to the attention of the House. It is also a pleasure to follow my friend, the hon. Member for Totnes (Anthony Mangnall). I was struck by the constructive point he made about how, in the spirit of cross-party consensus and co-operation, we can address many of the concerns in rapid order. It is in that vein that I make my own remarks this afternoon.

The strengthening and broadening of the scope of the groceries supply code of practice is necessary; as has been rehearsed already by those far more eloquent than I, it is also very timely. It is important to emphasise at the outset that our farmers, including those in Ceredigion, find themselves in a situation of severe uncertainty. We have already heard quite a bit about the impact of inflation; I do not need to rehearse the statistics, other than to say that the spikes in input and production costs have been severe.

Although inflation in terms of many of those input costs has come down, they are not reducing—there has not been deflation. Many of our farmers are still struggling with heightened input costs. This is also a time when unfair and quite extraordinary trading practices have been exercised by too many of the large grocery industry businesses. As the hon. Member for North Shropshire (Helen Morgan) mentioned, there has been a pincer effect on many of our farmers, who find themselves vulnerable. It is timely that we should be debating some of these changes this afternoon.

Farmers across the United Kingdom, and specifically in my own constituency of Ceredigion, value certainty. The businesses are built on long-term models, due to the investments required in agriculture and the growing and production cycles. So, yes, as we have heard, farmers are particularly vulnerable to inflation spikes but also to the extraordinary and unfair trading practices that arise from the severe power imbalance that many Members have described in detail this afternoon.

The fact is that the buying power of the groceries sector affords it a significant ability to apply short-term pressures on suppliers and producers, without much understanding of the long-term consequences. We have seen that power dynamic play out to disastrous effect over the past 18 to 24 months, particularly in the horticultural and poultry sectors. Other sectors also complain of severe practices being aggressively applied by some of the larger companies. It is quite appalling to hear about people being told at the very last moment that they are no required to produce as much, and the hon. Member for Neath mentioned lettuces. Others are finding that their contracts or verbal agreements are being changed with little notice. Indeed, some growers find out the price they will be paid for their produce only when they come to harvest. For an industry that is so dependent on certainty and long-term planning, these practices are simply disastrous, so it is right that we debate ways to address them and to restore some balance of power across the supply chain.

The right hon. Member for, I believe, Vale of Clwyd—

[Mr David Jones]

Clwyd West.