Groceries Code Adjudicator
Debate between John McDonnell and Andrew George(2 months ago)
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Andrew George (St Ives) (LD)
It is a pleasure to serve under your chairmanship, Mr Twigg. I congratulate my hon. Friend the Member for Brecon, Radnor and Cwm Tawe (David Chadwick) on an excellent and eloquent speech, which covered all the issues. I also thank the hon. Member for Salford (Rebecca Long Bailey) for contributing very tellingly.
My background in this subject is that, from 2002, I chaired what was known as the Grocery Market Action Group, which had among its members the National Farmers Union, the Country Land and Business Association, ActionAid, Traidcraft, Friends of the Earth and others. It was amazing to have such a disparate group of organisations in the same room, actually working together and agreeing 100% about the injustices and dysfunctionality of the way in which the grocery supply chain was operating.
We presented a range of evidence to the Competition Commission. That ultimately provoked an investigation in 2008, which resulted in the commission proposing the establishment of a groceries code to drive fair trade through the supply chain. The Groceries Code Adjudicator was created to enforce the code and ensure that it was applied by those supermarkets. In those days, only five had a turnover in excess of £1 billion, which was the recommendation of the Competition Commission at that stage.
Having done that, and having worked for over a decade to get the legislation through, I obviously have some skin in the game, which I probably need to declare. I am not trying to claim the credit myself, because it was a cross-party effort.
Andrew George
Well, I suppose I should—no, I will not. One stands on the shoulders of giants, and Colin Breed did a tremendous amount of work from 1997 to 2001. He produced an excellent report called “Checking out the Supermarkets”, which laid a lot of the groundwork for the Grocery Market Action Group. Albert Owen, David Drew and other Labour Members were also very supportive and active throughout those years. There was not always cross-party agreement, or even agreement within my own party, that we should intervene in the market in the way that was proposed. We had to win that argument, and ultimately we did.
At the end of the day, the justification for why the Groceries Code Adjudicator, or any kind of market intervention of that nature, was needed, was that, fundamentally, we had a dysfunctional supply chain operating largely to the benefit of the supermarkets. Not all of our agricultural sector was benefiting from European subsidies or any other public subsidies in those days, but it had become dependent on subsidies because the market was so dysfunctional that public money was needed to prop up the whole system. If we have a functioning market, one can enable the agricultural sector to free itself from dependence on public subsidy. That was largely what was behind what we were trying to do in those days.
When the Groceries Code Adjudicator was established and the code was created, the intention then was only that it would create a framework in which future Governments would review its progress and then build on the framework by introducing or reducing regulations. Certainly the framework was to provide the skeleton on which further developments could happen; of course one cannot anticipate all circumstances.
I want to follow up on the points made by the hon. Member for Salford and my hon. Friend the Member for Brecon, Radnor and Cwm Tawe. There are a number of improvements that I hope the Government will look at very closely. For example, the code should be applied throughout the supply chain, not just to the direct supplier to the supermarket. It was never the intention of the Grocery Market Action Group that the adjudicator should look only at the final transaction between the ultimate supplier to the supermarket and the supermarket itself, because the impact of that contract could be fed right down through the supply chain.
The second point concerned third-country suppliers. The reason why Traidcraft, the Fairtrade Foundation and so on were involved is because they were rightly hoping that third countries could be involved. Then, as my hon. Friend the Member for Brecon, Radnor and Cwm Tawe said, the adjudicator could launch its own investigation on the basis of market intelligence. Finally, it could work alongside the Gangmasters and Labour Abuse Authority, for example, to use its intelligence to take matters forward. Fundamentally, we have a framework that can be developed and improved. It certainly should not depend on seconded staff. We do not get commitment to the cause if we depend entirely on seconded staff, as my hon. Friend the Member for Brecon, Radnor and Cwm Tawe said. I hope the Minister will look carefully at this. Thank you very much, Mr Twigg, for allowing me to speak.