Supermarket watchdog to get greater powers against bully-boy retailers

West Country farming leaders and MPs have hailed a Government U-turn that will give a new supermarket watchdog the power to fine bully-boy retailers.

Ministers initially proposed that the groceries adjudicator should be able to “name and shame” stores which breach the Groceries Code, with Business Secretary Vince Cable reserving the right to introduce fines at a later date if the system did not work.

But farmers and other suppliers pressed for the adjudicator to have access to financial penalties as soon as the post is established next year. In response, Competition Minister Jo Swinson agreed yesterday to change legislation to give the watchdog more teeth.

Complaints from the region’s farmers have included supermarkets demanding one-off payments from suppliers to guarantee future business and forcing them to sell produce on two-for-one discounts.

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National Farmers’ Union head of government affairs Nick von Westenholz said: “We know from our members that they continue to suffer from unfair treatment by some retailers – so the news that we are now in sight of having an adjudicator up and running, and with the right powers to do their job, hasn’t come a moment too soon.”

Liberal Democrat MP Andrew George, chairman of the Grocery Market Action Group, which has been pressing for legislation for the past seven years, said: “The Government has listened to those who have campaigned on behalf of farmers, growers and other suppliers.”

The Cornish MP added: “This will give the watchdog the teeth necessary to protect suppliers from unfair dealing.”

Former strawberry farmer George Eustice, the Conservative MP who represents Camborne and Redruth, said yesterday: “I have always argued that to be a success the adjudicator needed to have the power to fine from the start so this news is very welcome.”

Bristol West MP Stephen Williams said: “It is very good news that the Groceries Code Adjudicator will be able to fine transgressors at the outset. Too often, the farmer or small supplier is squashed under the might of the major supermarkets that dominate our daily shopping.”

The maximum fine will be set on the basis of a recommendation drawn up by the first adjudicator within six months of the legislation reaching the statute book.

The Groceries Code was introduced in 2010 following a Competition Commission report into suppliers’ concerns that the big supermarkets were using their dominant market position to impose unfair conditions, such as varying supply agreements retrospectively, paying late and passing on the costs of marketing. It applies only to the ten biggest supermarkets, which each have a grocery turnover of £1 billion or more.