NFU sounds note of caution over Tesco's record-breaking profit announcement

Tesco, which reported a record-breaking £3.13bn pre-tax profit this week, has drawn a coolly congratulatory response from the National Farmers' Union (NFU).

The union said Tesco's results were a "great British success story", but warned the Government to take its responsibility to consumers seriously.

NFU president Peter Kendall said: "Undoubtedly, this is a Great British success story and in many cases British farmers have shared in that success. But my worry is that as the UK's flagship retailer weighs in with another record-breaking set of results, the Government may be blinded by Tesco as one of the few bright lights in the economy and forget its competition responsibilities."

Tesco's results revealed a 10% rise in profits on last year. Sales topped £1bn a week for the first time with group sales ringing up nearly £60bn. These profits were the highest on record for a UK retailer, said chief executive Terry Leahy, insisting the start to the current year saw like-for-like sales up 3.4%.

But the NFU's Peter Kendall said: "To a Tesco supplier, ‘savings in the supply chain' often means they will be subject to even more unreasonable demands including lump-sum payments to contribute to that impressive bottom line.

"Following the conclusion of the Competition Commission investigation last year, it is clear that unreasonable behaviour impacts on the consumer. In the consumer's best interests, the Government must implement the commission's remedies, including a grocery market ombudsman, if it is unable to secure undertakings from retailers such as Tesco.


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