Groceries Code Adjudicator

Tim Farron Excerpts

Tuesday 25th February 2025 Westminster Hall

[Tim Farron (Westmorland and Lonsdale) (LD)]

It is an honour to serve under your guidance this afternoon, Mr Twigg. I pay tribute to my hon. Friend the Member for Brecon, Radnor and Cwm Tawe (David Chadwick) for bringing this important issue to this place and for making an excellent speech.

There have been great speeches from all the speakers so far, with a number of interesting and useful interventions. The five hon. Members who have spoken all made good points that I want to endorse. My hon. Friend the Member for Brecon, Radnor and Cwm Tawe spoke about imbalance in the market with large numbers of producers—1,500 farmers in my constituency alone and thousands across the country—and 12 retailers making up 95% of the sector. That is an incredible imbalance of power. Others have also referred to the greater depth to the industry in the supply chain than the Groceries Code Adjudicator is allowed to give credit for. My hon. Friend talked of the impact on farmers of potential delisting, the impact of late payments, having to pay for waste, and all the things that many have to struggle with.

The hon. Member for Salford (Rebecca Long Bailey) made a great speech, emphasising the power those retailers have in the market and its irrational nature, which leads to farmers and producers of all kinds going out of business just because the large, powerful entities who own our supermarkets can make that happen in order to maximise their own profits.

My hon. Friend the Member for St Ives (Andrew George) absolutely deserves credit. I first heard the phrase “supermarket ombudsman” from his lips before I entered this place. When he was doing the job I am now doing—being the Liberal Democrats DEFRA spokesperson —he fought hard for that ombudsman, and that is the reason why, in the coalition agreement, what became the Groceries Code Adjudicator came to pass. It was introduced by Liberal Democrat Ministers including my right hon. Friend the Member for Kingston and Surbiton (Ed Davey), Vince Cable and Jo Swinson, who were involved in the Department.

The hon. Member for Lichfield (Dave Robertson) rightly talked about processors. They are significant and are often untouched by the arm of the Groceries Code Adjudicator. The right hon. Member for Hayes and Harlington (John McDonnell) talked about the role of ownership in the sector and the unfairness that affects the workforce in the retail sector, as well as the producers who supply to it. There is an important point for us to remember here. Those who are at the wrong end of the abuse of power in the food supply chain are processors in broadly rural communities and workers in broadly urban communities; they have a lot more in common than we are sometimes allowed to think.

The Groceries Code Adjudicator is one of the things that came from the coalition of which the Liberal Democrats can be rightly proud. It was motivated in no small part by the simple reality that many producers—many farmers—were being paid less than the cost of production for their produce. Most notably in my constituency in Westmorland, but elsewhere in the country, that means those working in the dairy sector, but there are many others besides.

As with all things in the coalition, there were compromises. Even the good things we got were often watered down and were not what they might have been had we had what will one day obviously happen, that is, a majority Liberal Democrat Government. There are three particular areas of weakness with the Groceries Code Adjudicator, which we passionately believe should be addressed in the interests of our farmers, producers and consumers alike.

First, the reach of the adjudicator is too small, particularly its ability to investigate across the range of people involved in the sector. As has been mentioned, the adjudicator can investigate direct supply arrangements between farmers and retailers, but cannot get involved in the enormous majority of the food chain—that is, in the processing sector, and the middle people within the market. The Groceries Code Adjudicator should be given that ability. That is obvious.

The second point is about protecting farmers and other producers from the reprisals that they fear they will get if they refer something to the adjudicator. Members of Parliament, the National Farmers Union—local branches in Kendal and Appleby, and the NFU across the whole country—the Tenant Farmers Association and other advocates should be allowed to make referrals to the Groceries Code Adjudicator so that farmers do not feel that they have to do so themselves while fearing the reprisals, which they clearly do. We strongly support that idea.

Finally, there is the issue of resource, which has been mentioned by other people. The team is seven-strong, including the adjudicator themselves four days a week. That is not right. However wonderful those people are, they can be run rings around by the enormously powerful supermarkets.

The unfettered free market is indifferent to Britain’s food security, and we need to be not indifferent. We need to decide that it is of ultimate importance and that we therefore need to referee the market powerfully to protect our food security. Over the last 20 years, we have seen 30,000 farm holdings cease to be—a 22.7% reduction in the number of farms in the United Kingdom. That is undermining our ability to feed ourselves. Now, only 55% of Britain’s food is produced by farmers in the United Kingdom. If we are serious about food security, we are going to have to put that right.

The Liberal Democrats are challenging the Government over the family farm tax—we would scrap it—which is suppressing production and creating unfairness in the market. There is a 76% reduction in the basic payment this year, undermining small family farmers in particular, in Westmorland and beyond. DEFRA officials told the Environment, Food and Rural Affairs Committee the other week that they expect 92% to 93% of farms to survive the environmental land management transition—so, 7% to 8% will not survive that transition. The land use framework, which I welcome in principle, will in practice potentially take productive farm land out of usage. All of that leads us towards a situation where the UK is less food secure.

The overdue Groceries Code Adjudicator reforms are not just vital to ensuring British farmers are treated fairly, which they must be; they are about underpinning the vitality of food security in this country, which is essentially national security. A country that cannot feed itself is not safe.