Growers welcome positive decision to set up ombudsman but bemoan further delay

News of the Government establishing an ombudsman to govern the Groceries Supply Code of Practice (GSCOP) has been welcomed by growers who have wanted this to happen for years.

British Independent Fruit Growers Association (BIFGA) chairman John Breach broke the news to growers last Wednesday, when consumer minister Kevin Brennan announced the decision.

"I was able to announce it at our technical day and there was a round of applause," said Breach. "It's 15 years almost to the day since BIFGA started this campaign. We are pleased to finally see it happen."

Brennan accepted the Competition Commission's recommendation for a body to enforce the GSCOP, which comes into force next month, and announced that consultation on the body and its powers will be launched in the coming weeks.

"The revised GSCOP is a great improvement on the current regime," said Brennan. "However, the power that large grocery retailers remain able to wield over their suppliers can still create pressures on small producers, especially in these difficult economic times, which ultimately may impact on consumers.

"It is not a question of whether a body is needed but exactly how that body will operate. The next step is to consult formally on its nature and role to ensure that all interested parties can make their views heard and that informed decisions are made."

Environment secretary Hilary Benn added: "The new ombudsman will help strike the right balance between farmers and food producers getting a fair deal and supermarkets enabling consumers to get the high-quality British food that they want at an affordable price."

But Breach said he was disappointed to hear that there is going to be "yet another consultation" after two lengthy investigations into the grocery supply chain. "The whole thing has been consulted on before. I do not see the need. They should just get on with it and get the ombudsman set up as soon as possible," he said.

"It's got to be a proactive regulator. He or she will need to create a climate for growers to want to invest £20,000 a hectare in new orchards. They need to know they are not just suddenly going to get a new buyer who has a different policy to the previous buyer. We have got to have some stability."

Another long-time ombudsman campaigner, Grocery Market Action Group chairman Andrew George MP, said: "This is welcome, as far as it goes. However, the Government ought to implement the commission's recommendation without delay. The commission referred this matter to the business secretary five months ago."

Last year, the commission concluded that large grocery retailers were passing on excessive risks and unexpected costs to their suppliers. It pressed retailers to set up an ombudsman themselves, but they rejected the idea.

British Retail Consortium director general Stephen Robertson has since rubbished the ombudsman plan, arguing that such a body would result in more negotiating power being given to the multinational food business from which supermarkets source many of their products. He also argued that it would cost customers millions of pounds in higher prices.

"It's disappointing that the Government has decided to pursue this despite the lack of evidence that it is needed," Robertson complained. "There is already a supplier code overseen by the Office of Fair Trading (OFT) and offering the right to independent arbitration. It has long been compulsory for the big four supermarkets and is being extended to more retailers next month.

"OFT chief executive John Fingleton has said supermarkets are pro-consumer - bringing lower prices, innovation and new services - and an ombudsman is not necessary."

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