Groceries Code Adjudicator Bill [Lords]

Simon Hart Excerpts

Monday 19th November 2012 Commons Chamber

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

This is an eagerly awaited moment, and it is a very welcome one for Members from all parties. I suppose I should declare an interest, as some of my relations will benefit from this proposal. Certainly, many of friends will benefit, and most importantly, so will many of my constituents. The shadow Minister was perhaps a little unkind when he criticised the Government for a lack of progress, because progress has been pretty swift and there is a momentum behind the process, as has been recognised and is respected by all those who will, in due course, be on the receiving end of its impact, be that negative or positive.

I want to take a few moments to make two points. First, on the plus side, there has been some discussion of the confidentiality element, whose importance I do not think should be understated. It has concerned many people across different parts of the supply chain, but particularly in farming, where there is some nervousness, not necessarily about the content of the contract, but about its length, as was touched on in the most important contribution made by my hon. Friend the Member for Camborne and Redruth (George Eustice).

Confidentiality is very important, particularly in agriculture, where there is a large debate about long-term investment. There is real concern, particularly in the dairy industry, about entering into investment arrangements that will take, in some cases, 20, 30 or 40 years to reap the necessary rewards. Any degree of confidentiality that can be guaranteed for those producers will in turn secure a better contractual relationship with the retailers and enable them to invest properly in agriculture, which we constantly refer to in this House.

Secondly, I want to touch on the argument that has been made, albeit fairly weakly so far, about whether the proposal constitutes yet more regulation that our agricultural industry will have to put up with. Regulation is frequently misquoted in this House, particularly regulation relating to farming. No farmer I know is opposed to regulation; what farmers are opposed to is unnecessary regulation, poor regulation or regulation that fails to achieve its original objectives. I suggest that the proposal is a form of regulation that does exactly what it says on the tin. It is desired by the agricultural community and so provided that it migrates into law broadly in the manner currently proposed, it should give great reassurance. Therefore, I do not think that we should dwell too long alongside those who dismiss it simply as some kind of intrusive regulation, because it is not. It will make the business of farming and making a living in the countryside all the more secure.

Reference has also been made to the contrast between naming and shaming as a means of deterrent and fining. I must say that I think I am in step with everyone other than the Government when it comes to the view that naming and shaming alone will not be sufficient. If it was, why have I received only one piece of correspondence from any of the 10 supermarkets that might be affected? Waitrose is the only company that has bothered to write to me at all about today’s debate. I do not detect that those in the higher echelons of the so-called big 10 are quaking in their boots. The idea that naming and shaming a supermarket on some website or trade magazine will deter purchasers from going into their stores is, frankly, an exaggeration. If the proposal could provide the adjudicator, rather than just the Secretary of State, with a power to fine more urgently, that would undoubtedly chime with the evidence and submissions that have been provided to us all from countless individuals and organisations.

I hope that the Government will not fall into the trap —I am sure they will not, because this is a good proposal —of believing that they have a monopoly of wisdom on this particular point. I cannot believe that all the trade organisations, individuals, farming businesses and other observers of the process who have written to us are wrong and the Government right. Perhaps I am missing the point. If there is a clever reason why we should not go down this route, will the Minister who responds to the debate explain it in their winding-up speech? It seems to have bypassed not only me, but everybody else with an interest in the issue.

I also hope that we will be careful in managing expectations, particularly those of the agricultural industry. The original idea was for a supermarket ombudsman and it looked like they would have all sorts of powers that the adjudicator will not have. Some thought that that would be a means by which price could be manipulated or guaranteed, so I hope that we can continue to make it clear that this is not a mechanism, nor should it be, that will guarantee a particular price for a product. The measure has been announced in various manifestos and, over time, that red herring has been allowed to stick.

I hope that the Minister will refer to smaller suppliers who might suffer at the hands of retailers that do not fall under the top 10, or big 10, category. Plenty of the producers who are watching our progress with great interest do not supply the big 10, but they might supply the next big 10, so they hope that the measures may rub off in that regard.

Finally—I said that my contribution would be brief—I hope that further attention will be given to the funding model. Rather than continuing with the current model, which is a one-size-fits-all, across-the-board flat fee, a model that more accurately reflects the scale of offences that might be committed by the retailers might be a fairer way of securing the confidence of not only the producer, but the customer. As we all know, the brand is probably the most vital part of the big 10 retailers’ business, but the bottom line is also important, so the question is: what comes first—the brand or the bottom line? This debate has been helpful, particularly, as I have said, the contribution of my hon. Friend the Member for Camborne and Redruth, which I hope the big 10 retailers will take a long, hard and close look at when Hansard is published tomorrow.

In summation, this is a great moment. It proves that some of the things that we write in our manifestos resonate with the wider public. The issue addressed by the Bill certainly does. It was mentioned in the run-up to the last election and I am delighted that we have got on with it as quickly as we have. Its basis seems to attract widespread support throughout the House and, more importantly, among retailers throughout the UK, particularly in Wales, where this activity is being scrutinised. I hope that we will be able to deliver a result that will please the constituents of that country.