By Max Clarke
An independent body acting as ‘adjudicator’ between the suppliers and retailers in order to safeguard consumers and suppliers from overpriced retailers was unveiled today.
“Preventing unfair practices and increasing certainty for suppliers will safeguard consumer interests, as large retailers won’t be able to take advantage of their position of power, as set out in the Code,” explained Consumer Minister Edward Davey on publication of the Groceries Code Adjudicator Bill.
And while increased transparency between government and consumers, as well as between suppliers and retailer was the intention of the bill, the move has been criticised by consumer groups.
"The supermarket adjudicator will just add costs to retailers and push up shop prices for customers,” commented Food Director at the British Retailers Consortium, Andrew Opie.
"Food prices are already under considerable pressure from rising global commodity costs and climbing fuel and utility prices. Retailers are doing their best to cushion customers from the full impact of these increases. The extra costs of dealing with a new administrative body will make it even harder to keep price rises away from shop shelves.
"The Bill says the adjudicator will cost only £800,000 a year to run, to be paid for by the ten biggest food retailers. If the Government really believes a public body can be run that cheaply it should cap the charges imposed on them at that level and commit to funding any extra costs itself.
"It's in supermarkets' own interests to have good long-term relationships with their suppliers as part of securing their supply chains. The Groceries Supply Code of Practice has been in existence for more than a year. So far as we can discover, it has not resulted in even one dispute between stores and suppliers going to independent arbitration. This begs the question — what will a grocery code adjudicator do all day?
"The UK has the most regulated grocery sector in the world. If the Government is set on this ill-judged course it must at the very least keep the regulatory burden and related costs to an absolute minimum, for the good of shoppers across the country."