Food Industry Competitiveness

Like the hon. Member for South-East Cambridgeshire (Mr. Paice), I am pleased that the Government have provided time to debate this important issue. I welcome the Government's belated statement on 13 January. I should also declare an interest as someone who has chaired an organisation called Grocery Market Action Group for the past four years. It has cross-party support and representatives from the National Farmers Union, the National Farmers Union of Scotland, Friends of the Earth, ActionAid, Traidcraft, the British Brands Group, the Association of Convenience Stores, the British Independent Fruit Growers Association and several other organisations with an interest in a competitive and effective food industry in the UK and in fair trade with suppliers in developing countries. It is important to note that those organisations and others, who have watched how this sector has developed over the past 11 years of various inquiries by the Office of Fair Trading and the Competition Commission, and the original voluntary supermarket code of practice, are not criticising the supermarkets and their behaviour as being in some way criminal. Indeed, their activities have been entirely rational. It would be surprising if anyone in the position of the Sainsburys, Tescos and Asdas of this world did not take the fullest possible advantage of their impact on market—the OFT has described them as able to dictate market conditions. They are in a very powerful position and their behaviour is entirely rational. The issue that the competition authorities have considered over the years is whether those firms' use of power in the marketplace has turned from effective and clever into an abuse. The important work of the Competition Commission in an excellent report published in April 2008—and the length of time since then is one reason why people are getting frustrated—demonstrated that we are talking about a level of abuse. The Minister himself in his opening remarks referred to the transfer of excessive risk and unexpected costs, and that has been clearly demonstrated by the thorough inquiry by the Competition Commission. The inquiry stated that it has""an adverse effect on investment and innovation in the supply chain and ultimately on consumers."" The last important point was left out of the Minister's comments. It is important that we have a market working in the interests of consumers.