Groceries Code Adjudicator

I congratulate the hon. Member for South Staffordshire (Gavin Williamson) on securing the debate and reminding us of this very important issue. It is now more than a year since my hon. Friend the Member for Ynys Môn (Albert Owen) led the Second Reading debate for his private Member's Bill—the Grocery Market Ombudsman Bill. In that debate, he made it clear that the concept of a grocery ombudsman or adjudicator is not about being pro or anti any particular interest group. It is about fairness to all those involved, whether they be farmers, small producers, local suppliers, suppliers from developing countries, small shops, convenience stores, supermarkets or, most importantly, consumers. I pay tribute to the work that my hon. Friend and the hon. Member for St Ives (Andrew George), who chaired the grocery market action group, did in harnessing the support of organisations such as the Rural Shops Alliance, the Association of Convenience Stores, the National Farmers Union, the Farmers Union of Wales, the British Independent Fruit Growers Association, the British Brands Group, Traidcraft, ActionAid UK and Banana Link and in pushing the agenda forward from the early days of the Competition Commission inquiry in 2006 through to the establishment of the new groceries supply code of practice, which came into force on 4 February 2010. They gathered cross-party support, which led to the inclusion of the concept of an adjudicator in each of the three big parties' 2010 general election manifestos. In the Labour party manifesto, we said that we would ensure"““fairness for food producers through EU reform and a Supermarkets Ombudsman””" and that"““to protect farmers and food suppliers from unfair and uncompetitive practices by major retailers””," we would"““create a Supermarket Ombudsman.””" The Conservative party said in its manifesto:"““To ensure the grocery supply code of practice is applied fairly, we will introduce an independent supermarket ombudsman.””" The Liberal Democrats promised in their manifesto to create"““a legal Supermarket Code and a powerful independent regulator of Britain's food market.””" It is remarkable that three parties should have had such similar wording on a topic. Then the coalition was formed and the coalition agreement committed it to introducing,"““as a first step, an Ombudsman in the Office of Fair Trading who can proactively enforce the Grocery Supply Code of Practice and curb abuses of power, which undermine our farmers and act against the long-term interest of consumers””—" strong words indeed. The reason why hon. Members are here today and why the Minister was asked a question on this topic just last Thursday is that hon. Members are wondering what has happened to that commitment. They are wondering whether the commitment in the coalition agreement to introduce an ombudsman has gone the same way as the commitment to create a post bank and whether it could become yet another broken promise. It was encouraging, therefore, to hear the Minister confirm on Thursday that he expects to publish a groceries code adjudicator Bill ““soon after Easter””. We look forward to that. Perhaps the Minister will today give us a more precise indication of what exactly ““soon”” means and what is likely to be in the Bill. Will he give us more detail of exactly how he envisages the role and work of the groceries code adjudicator and how proactive the adjudicator will be in enforcing the code? As hon. Members will know, the new groceries supply code, which came into force on 4 February 2010, applies to all companies that are active in the sector and have an annual retail groceries turnover of £1 billion or more. As a number of hon. Members have reminded us, suppliers are reluctant to make complaints for fear that they will be identified and that retailers will subsequently stop trading with them. So the new groceries code introduced independent binding arbitration and made it clear that retailers could stop trading with suppliers only for genuine commercial reasons, not because the supplier had complained that the retailer had not respected the conditions of the original trade deal. Can the Minister confirm that, in keeping with the Government response to the 2010 consultation, the proposed Bill will give the groceries code adjudicator the power to receive anonymous complaints? The new code also placed the burden of proof on the retailer to demonstrate that the supplier had voluntarily complied with the requests made. It introduced a fair-dealing provision, requiring retailers to act in good faith in both formal and informal agreements. However, proper enforcement of the code is essential in ensuring its effectiveness, which is why an adjudicator is so important. Will the Minister tell us how his Bill compares with the private Member's Bill promoted by my hon. Friend the Member for Ynys Môn, in which he mentioned investigating and adjudicating on alleged breaches of the code, and powers to gather information, enforce penalties and award costs? Will the Minister confirm that, as expressed in the Government response to the 2010 consultation, the Government do intend to provide in primary legislation the powers to introduce financial penalties? I welcome the wording of the coalition agreement, which speaks of an ombudsman who can ““proactively enforce”” the code. Can the Minister confirm the proactive nature of the adjudicator's role as he envisages it? Does he envisage the adjudicator's having the necessary powers and resources to instigate proactive investigations when he feels that those are likely to be justified? What sort of investigative powers will the adjudicator have? Will the adjudicator's powers to request information be backed up by a power to create offences for failure to comply with requests for information? We have the new groceries supply code of practice, a commitment from hon. Members on both sides of the House and plenty of material on which to build—the Competition Commission evidence, my hon. Friend's private Member's Bill and the 2010 consultation. There is general support among the public. The role of the adjudicator is to ensure fairness. That is to the benefit of all. The very existence of an adjudicator with real powers will be an incentive to good practice and fairness and will focus minds on the groceries supply code. It is important to have powers that can be used, although it is often more desirable to sort out difficulties without having to resort to the full force of those powers. Whatever we call the office—a supermarket ombudsman, as some would say, or a groceries code adjudicator, as the Government now prefer to say—its existence will be good for the consumer and good for all those players in the sector, be they supermarkets, small retailers or suppliers, who want to play by the rules. We look forward to hearing from the Minister about the progress that he has made to date on the proposed groceries code adjudicator Bill and, in particular, what the time scale is for introducing it. Without further ado, I thank all hon. Members who have brought this very important topic to the Minister's attention and I ask him to deal with the issues that we are interested in hearing about.