The supply debate hit the House of Commons as an MP urged Gordon Brown to act now to defend the interests of thousands of farmers and grocers who supply the larger supermarkets.
Andrew George, MP for the West Cornwall and Isles of Scilly Constituency of St. Ives, called upon the Prime Minister to act swiftly to implement the recommendations of the Competition Commission following their inquiry into the UK Grocery Sector
The Liberal Democrat MP questioned Brown during Prime Minister’s Questions calling on him to act decisively on the issue and protect suppliers in the context of a recession which could be further strain on the relationship.
George said: “The Competition Commission reported last year that the large supermarkets and I quote, ‘transfer an excessive risk and unexpected cost… to their suppliers’, damaging consumer interest and to the detriment of farmers and growers both here and in the developing world.
“Does the Prime Minister agree that the Competition Commission’s proposed remedies to tackle this particular problem, should be implemented now without any further delay?”
The Prime Minister replied: “[George] is absolutely right to highlight this problem. First of all, we are asking supermarkets to change their practice and introduce early payment to their suppliers.
“Secondly, in relation to developing countries, we have been in talks with supermarkets like Asda about how they can source their produce from these countries at a fair price. We will continue to push for this as quickly as possible”.
Mr George has a long-standing interest in this issue as he chairs the All-Party Cross-Cutting Group of supplier organisations, NGOs and academics, a group which has been submitting evidence to the Competition Commission on unfair dealing by supermarkets with their suppliers.
It has collectively called for the government to do more to protect the rights of supermarket suppliers. Specifically, the Cross-Cutting Group wishes to see the implementation of the Competition Commission’s recommendation for the introduction of a Grocery Market Ombudsman to regulate the relationship between supermarkets and their suppliers.
Commenting on the Prime Minister’s response, Mr George said: “The tone of the Prime Minister’s response was encouraging. But every day the Government fails to commit itself to implementing the recommendations, more farmers and grocers are being pushed closer to insolvency.
“The supermarkets continue to prosper and profit during the recession. They will plead that they’re offering more discounts. But who pays for this? It is not the supermarkets. Suppliers are given little choice, whether they can afford it or not.
“It’s time to act. The government must be decisive. Delay will only deepen the recession for thousands of smaller businesses which now depend on an early return to fair dealing.”
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