A new Groceries Code Adjudicator (GCA) has been unveiled to protect suppliers from mistreatment by supermarkets.
However, the fact that the adjudicator will not be in place until 2012 and will initially only have naming and shaming powers at its disposal has caused widespread disappointment.
The government this week published its response to the consultation to establish a body to monitor and enforce the Groceries Supply Code of Practice (GSCOP). The department for business, innovation and skills (BiS) will work on legislation to set up the GCA, which will be housed within the Office of Fair Trading, by 2012.
The GCA will have the power to receive complaints about the way supermarkets interact with primary suppliers from anyone in the supply chain in the UK or overseas, and deal with them anonymously. This includes growers who may not supply the large supermarkets directly. Significantly, trade associations and non-governmental organisations will not be able to lodge complaints directly.
Consumer minister Edward Davey said: “We want to make sure that large retailers can’t abuse their power by transferring excessive risks or unexpected costs onto their suppliers. These sorts of pressures are bad for producers and bad for consumers - they can lead to lower quality goods, less choice and less innovation.”
The British Retail Consortium has already slammed the GCA as an “unnecessary quango” which will heap additional costs onto consumers.
The NFU said it had issues with some of what was included in the document, but said the GCA was a “crucial step towards fairness in the food chain”. “I am firmly convinced an adjudicator will benefit the whole supply chain... however, once in place I believe we will see fewer instances of flagrant bully-boy tactics used by the supermarkets,” said president Peter Kendall.
The Fresh Produce Consortium has welcomed the remit of the GCA to cover overseas suppliers but has some other major concerns. Vice-president Adrian Barlow said: “I do not think that loss of reputation is a sufficient penalty. Those that are minded to transgress will not be inhibited by loss of reputation.”
The government said it intended to provide powers within the legislation to introduce regulations to impose penalties - but only at a later date and if evidence shows that reputation alone is insufficient.
Larger fresh produce suppliers had a different view. One importer and category manager told freshinfo: “We have a good relationship with our supermarket customers and I don’t think there is anything in this that we would want to use ourselves.”
And John Smith of Greyfriars objected to the interference of the CGA in a commercial relationship. “It is never right to interpose a quasi-civil-service into commercial activity. The problem is the GCA will only act when it’s too late and there has been a fall out between a supermarket and a supplier and that supplier has been de-listed.”
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