The British Independent Fruit Growers’ Association (BIFGA) has called upon the Competition Commission to install a “permanent, proactive regulator” to oversee the dealings of all multiple retailers.
In a letter to the Commission, in relation to its grocery market investigation, BIFGA chairman John Breach agreed with the recently published interim findings of the inquiry; that by transferring excessive cost onto suppliers, the big four are stifling investment and innovation in the supply chain. He said: “The fact that the Office of Fair Trading and the Competition Commission between them have been carrying out inquiries virtually continuously since July 31, 1998 surely shows that there is a need for a permanent regulator.”
Breach added that such an appointment, allied with the operation of a more suitable code of practice that brings all multiples with more than 20 outlets under one banner rather than concentrating on the big four, should “ensure a fair deal for consumers, suppliers and retailers alike”.
He urged the Commission not to allow the supermarkets the opportunity to water down the code of practice. “They, in effect, have once again been “found guilty” of certain practices, and therefore should have no say in the form of the code that the CC decides upon,” said Breach.
The CC has intimated it prefers the installation of an ombudsman or adjudicator, to settle disputes, but Breach believes this would have little or no effect. It would not, he said, “be sufficiently re-assuring to give suppliers the confidence they need to innovate and invest for the longer term.
“A proactive regulator would (perhaps at random) visit suppliers (including primary producers) to verify that they were being treated fairly…produce an annual report, with other specific reports as and when required.” He added that the reports could act as “warning shots” to misbehaving retailers, which are unlikely to be complained about by suppliers “fearful” of delisting.
“A new proactive regulator, who would report directly to the relevant minister or ministers, would be best placed to monitor compliance with [the code of practice] and deal with other relevant matters. [It] would ensure best practice; evolving remedies; and continuing improvements in customer choice of goods and services,” Breach said.
“We strongly urge the CC to take this opportunity to recommend the appointment of a permanent, proactive regulator, armed with the necessary powers. Hopefully, this would give our members the confidence to go ahead and plant new orchards and, perhaps, to make other investments such as in new cold storage and packing facilities, thereby helping to ensure that English apples and pears will be available to consumers in increasing volumes in the future.”
