Pressure group slams OFT "failure"

The Breaking the Armlock Alliance has condemned yesterday's Office of Fair Trading ruling on the supermarket code of conduct as "a failure to regulate". The Alliance, which includes environment, consumer and farmer organisations, has consistently called for the supermarket code of practice to be strengthened and an independent ombudsman set up to monitor and enforce the code's use.

Without this, the Alliance believes, “the big four supermarkets will continue to abuse their market share by making unfair demands on small suppliers, cross-subsidising and unfairly competing against smaller players”.

John Taylor, director of local and regional economies at the new economics foundation, said: "Our biggest supermarkets will not act as their own 'check and balance,' we must have regulators with teeth to protect an open market place in which the small suppliers, farmers and stores who contribute so much to communities and economies across the UK can survive."

Friends of the Earth senior food campaigner Vicki Hird said: "This decision by the Office of Fair Trading beggars belief. How many UK farmers need to go out of business before the OFT recognises that the Supermarket Code of Practice protects no-one but the supermarkets themselves? What we need is an independent watchdog and a moratorium on further takeovers by the big four supermarkets - what we've got is a supermarket-friendly report, which leaves farmers and independent shops hanging out to dry"

The Alliance believes an independent watchdog is needed, which will allow suppliers to bring forward complaints in confidence. Under the current system suppliers are unlikely to report abuses as complaints must go through the retailer, putting their livelihoods at risk.

The Alliance also believes regulation is the only approach that will to stop supermarket abuse of power. Evidence shows that even the most robust voluntary initiatives with supermarkets do not work. Farmer, development, environmental and consumer organisations across the UK and globally are now calling on their governments to introduce regulation to protect suppliers, consumers and independent retailers from increasing supermarket power.