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Momentum growing for extension of Grocery Adjudicator's powers

A review of the powers of the supermarket Adjudicator is due to get underway soon as farm leaders and politicians step up the campaign to grant it more powers to address ongoing abuses of power in the supply chain.
Farm leaders want to see the GCA's remit extended beyond the top 10 retailers
Farm leaders want to see the GCA's remit extended beyond the top 10 retailers

The Government has confirmed it is giving serious consideration to extending the powers of the Groceries Code Adjudicator, as industry pressure to give the watchdog more teeth grows.

 

A review of the Adjudicator Christine Tacon’s powers is due to begin shortly against a backdrop of calls from industry bodies and politicians for change.

 

The GCA came into force in June 2013 with a remit to enforce the Grocery Supply Code of Practice (GSCOP) covering just the 10 biggest UK retailers with a turnover in excess of £1 billion.

 

Mrs Tacon has completed one successful investigation, finding Tesco guilty of delaying millions of pounds worth of payments to suppliers, although she was unable to fine the retailer as the breaches occurred before she was granted the power to do so.

 

While the watchdog has been credited with improving supermarket practice in some areas and bringing about some positive, industry organisations are adamant it could do much more to address the current imbalance of power within the supply chain.

 

This includes broadening its powers to cover much more of the supply chain.

Open to change

A source close to the Business Secretary Sajid Javid has been quoted as saying he is ‘open’ to altering the GCA’s remit.

 

The source told the Independent: “He has had a meeting with a few colleagues and said he will go with the evidence either way.”

 

A Department for Business spokesperson said: “A review into the Grocery Code Adjudicator is due shortly and we will look at how this can help the farming industry.”

 

In a letter delivered to David Cameron last week at the end of the London march, Farmers For Action leader David Handley called on the Prime Minister to ‘give more powers’ to the GCA to investigate the dysfunctional supply chain’.

 

Speaking ahead of the London march, TFA chief executive George Dunn said: “The Groceries Code Adjudicator has lifted the lid of malpractice within one major retailer and it now needs the powers and resources to go deeper and wider within the supply chain.”

 

The TFA is calling for the GCA to have:

 

  • Additional powers to investigate malpractice within the groceries supply chain including OFSTED style powers to engage with retailers
  • A remit to look at the whole of the supply chain where required - not just direct contracts –
  • The responsibility to report on the balance of returns within the supply chain.

 

NFU president Meurig Raymond said the GCA’s presence has already resulted in ‘better behaviour’ among supermarkets and ‘brought a discipline to drawing up contracts that wasn’t there before’.

 

“But there is no doubt abuses of the code are still taking place and we want to see the GCA give more powers and more resources to tackle this,” he said.

Voluntary codes

The NFU is calling for the Adjudicator’s role should be extended to encompass the two voluntary industry codes covering milk and beef, which cover relations between farmers and suppliers, including terms of contracts and, with beef, specifications, charges and deductions.

 

“We believe there has been some abuse in these relationships. That needs to be encompassed into the GCA,” Mr Raymond said.

 

The NFU is also calling the turnover threshold determining which retailers are covered by the code to be reduced to bring more retailers ‘under the GCA umbrella’.

 

In a further extension of powers it would like to see ‘some of the big operators in the food service sector’ brought into the fold.

 

Ben Reynolds, deputy co-ordinator at food and farming charity Sustain, said: “We applaud the work of the adjudicator to date, but would welcome an extension to its remit to better protect smaller farmers and producers from unfair trading practices.

 

“We would also like to see the strengthening of the adjudicator’s investigative powers, and power to fine companies breaching the code.”

 

Tim Farron, the Liberal Democrat leader and Cumbrian MP, said he was asking Business and Defra Ministers to extend the Adjudicator’s to include farmers ‘as soon as possible’.

 

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