Groceries Code Adjudicator Bill [Lords]

Peter Luff Excerpts

Monday 19th November 2012 Commons Chamber

[Jo Swinson]

I am still responding to the earlier question, but if the hon. Gentleman will have a little patience I will come to his intervention shortly.

On the other point raised by the hon. Member for West Bromwich West (Mr Bailey), there will obviously be a regular review of the adjudicator. That is appropriate in ensuring that it functions as it should and that any necessary changes can be made, but we will not prevent the adjudicator from properly considering information before the initial review is produced. I want to make a little progress and then I will take an intervention from my hon. Friend the Member for Sherwood (Mr Spencer).

The adjudicator will be funded by a levy from the 10 largest retailers and will have the power to investigate breaches and to impose sanctions against supermarkets found to have breached the code. Some Members have previously criticised the Bill as being anti-business. What is anti-business about ensuring that the grocery market works as well as it can, without being distorted by anti-competitive and unfair practices?

[Peter Luff (Mid Worcestershire) (Con)]

On that point—

[Jo Swinson]

I will make a little progress, and then I will give way.

The direct or indirect suppliers who are among the potential beneficiaries of the Bill include fresh food intermediaries and food and drink manufacturers. That is why the Bill is supported by major business groups, including the Food and Drink Federation, the British Brands Group, the Association of Convenience Stores and the National Farmers Union. A fair market is one in which suppliers and supermarkets are free to innovate, expand and offer the widest possible choice to the consumer without fear of being disadvantaged by unfair dealings elsewhere.

[Jo Swinson]

Clause 18 provides that there is a duty on the adjudicator to protect confidentiality. That goes beyond not allowing publication of the name of the individual or supplier making the complaint. As my hon. Friend rightly says, there are circumstances where an investigation could, in effect, give away who had made the complaint. In that circumstance it would be possible for the adjudicator to undertake a slightly wider investigation in terms of geographic scope or the types of vegetable being investigated, so that it would not be possible to identify which individual or supplier had come forward and made a complaint.

[Peter Luff]

This welcome legislation, like that which introduced the Gangmasters Licensing Authority some years ago, proves that effective and targeted regulation can help consumers and all those who work in supplying the food industry, but I am sure the Cabinet Office will have thought about deregulatory measures as well, as a quid pro quo for this regulatory measure. In that spirit, will the Minister tell us what progress is being made on the abolition of the Agricultural Wages Board, which would also help consumers and those who supply the industry?

[Jo Swinson]

Consultation is taking place on that measure. My hon. Friend the Minister of State who is summing up the debate as the Minister with responsibility for farming will, I am sure, be able to enlighten the House further on that point.

What will the adjudicator do? The adjudicator’s role is to investigate large retailers and hold them to account if they have broken the groceries code. He or she will also be able to act as an arbitrator to resolve private disputes between suppliers and large supermarkets, as the groceries supply order envisages. Aside from these main roles, the adjudicator will have a number of other functions. These are to publish guidance on when and how investigations will proceed and how enforcement powers will be used, to advise large retailers and suppliers on the groceries code, to recommend changes to the groceries code to the Office of Fair Trading, to arbitrate individual disputes between large retailers and the direct suppliers, as mentioned, or to appoint another person to do so, and to report annually on his or her work, which will be laid before Parliament.

--- Later in debate ---

[Jo Swinson]

The hon. Gentleman raises serious issues, not least that of legality and human trafficking. If there is evidence of law-breaking, it should be taken to the appropriate authorities so that it can be followed up. I appreciate his concern, but the adjudicator’s role and the groceries code have been developed in response to the Competition Commission report of 2008. Notwithstanding the serious issues that he raises, the way to proceed is to focus tightly on the report, which provides the clear basis for addressing the problem and consumer detriment that we are trying to solve. Although I have explained to the House that the code is not a panacea that will solve every possible problem, it does mean that we can continue with a strong degree of consensus and cross-party support.

[Peter Luff]

I reassure the hon. Lady that the Gangmasters Licensing Authority is doing a first-rate job at addressing the concerns of the hon. Member for Linlithgow and East Falkirk (Michael Connarty). If he has evidence of such abuse, he should take it to the authority urgently and it will be addressed effectively and well. That is a tribute to the previous Government’s action on this important question.

[Jo Swinson]

I thank my hon. Friend for his contribution. He makes his point forcefully.

I believe that the threat to supermarkets of recommendations and requirements to publish details will be enough to drive cultural change. Hon. Members should note that imposing a financial penalty would confer a full merits right of appeal, which would potentially be costly and time-intensive for all parties. It is important that the adjudicator is able to focus on investigations, rather than being distracted by appeals. I am sure that all constituency Members recognise that where there are appeals procedures, such as in planning, they tend to be used. We do not want the groceries code adjudicator to be tied up in appeal after appeal, but want them to be able to get on with their investigations. That is why we think that it is helpful to proceed with the range of sanctions in the Bill.