We are urgently developing research requirements with other European laboratories to make sure we understand and the disease (Schmallenberg) better.Competition Commission submits final ombudsman proposal
THE Competition Commission (CC) has put forward a formal recommendation to Government to introduce a supermarket ombudsman after some of the UK’s leading supermarkets failed to sign up to the proposals.
The recommendation has been put to the Department for Business Innovation and Skills (DBIS) and Ministers will now review the proposals before making a decision on whether to set up the ombudsman through primary legislation.
The CC has also published the new Grocery Supply Code of Practice (GSCOP) which will have to be included in all retailers’ contracts with suppliers and will prohibit practices such as retrospective adjustments to supply agreements.
Retailers will now have six months to comply with the new Code, but CC chairman Peter Freeman said there was still an urgent need for an ombudsman to oversee supermarkets’ dealings with their suppliers.
He said: “Our inquiry clearly revealed problems that require action and which, if left unchecked, would damage the consumer. We continue to believe that everyone’s interests - and that includes retailers - would be served by tackling a problem that has clouded the industry for many years now.
“The current economic difficulties if anything reinforce rather than reduce the need for action. Whilst some retailers have recognised this, regrettably the majority have not.
“We made every effort to persuade retailers of our case as it would be the quickest way to establish the ombudsman.
“It is clearly desirable that the ombudsman be established as soon as is practicable. The new Code of Practice will work much better as a result and suppliers and retailers will have greater confidence that its terms will be observed.”
The ombudsman proposal was initially set out in May last year following a two year investigation into the grocery market but after failing to get support from the ‘big four’ supermarkets the CC has been unable to set it up voluntarily.
Instead, Mr Freeman has now written to Minister of State at DBIS Kevin Brennan calling on the Government to take action.
The timetable for progress is likely to be tight, and supply industry organisations will now focus their lobbying on Ministers at DBIS to push for the plans to be included in the Queen’s speech in September.
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The CC's full recommendation to DBIS
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Readers' comments (4)
Deryck Fell | 4 August 2009 2:38 pm
The powers that be still fail to recognise the damage that Supermarkets are doing to the UK economy, not just the grocery industry but everything supermarkets sell they can actually sell goods at very little profit because of the delayed payments that they make to their suppliers up to 3 months but they are paid straight away this meens at any one time they have Millions of pounds of other peoples money in their banks even this is not enough they use their extreme buying power to squeze the suppliers to the limit and beyond destroying the infrastructure of society especially in the countryside
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Bob Forrest | 4 August 2009 2:55 pm
Didn't Hilary Benn try and do something about that at the start of the recession, he met supermarkets and told them to pay suppliers early.
I don't know anyone who saw early payment.
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Anonymous | 4 August 2009 3:03 pm
M&MC dropped the name and became CC I thought that was so that the supermarkets could keep their monopoly and strengthen it further, which is what has happened so far. I always thought that CC aided the supermarkets. I cannot believe that they can pull them back into line now, but I live in hope.
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Richard Micklethwait | 5 August 2009 1:16 pm
The common theme running through this problem and the banking crisis is that capitalism will destroy itself unless properly regulated. This Government has no idea on how capitalism works and so no idea how to regulate it quickly and effectively, which is to the long term benefit of a capitalist economy.
If they did they would not be Socialists.
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