Supermarket Adjudicator report right to ask for safeguards

The Parliamentary Committee scrutinising the planned supermarket / supplier adjudicator has accepted a number of the points made by the British Retail Consortium (BRC) aimed at minimising the costs it will inevitably impose on retailers.

The Adjudicator will oversee the Groceries Supply Code of Practice which has been in place since February 2010.

Reacting to the report of the Commons Business, Innovation and Skills Committee on the Groceries Code Adjudicator Bill, published today (Thursday) the BRC said, while it was disappointing that the Committee has not rejected allowing anonymous and third-party complaints, it is right to recognise the need for strict and robust guidance.

The Committee also welcomes, "the substantial investment made by large retailers to ensure compliance with the Code," and acknowledges that, "supermarkets continue to provide a highly competitive offering and hence substantial benefits to customers."

The BRC said the Committee is also right to call for a high evidential threshold to be reached before the Adjudicator launches an investigation and to say the Adjudicator should only investigate in response to a complaint, not pro-actively.

British Retail Consortium Food Director Andrew Opie said: "We have always said it’s in supermarkets’ own interests to have good long-term relationships with their suppliers and an adjudicator is not necessary. But, if the Government is set on introducing one, it must keep the regulatory burden and related costs down, to avoid higher shop prices for customers.

"I’m pleased the BIS Committee has recognised supermarkets’ investment in complying with the supplier code and the good job they do for customers. It has responded to our comments to it with a number of recommendations which can help minimise the burden the Adjudicator will place on retailers.

"The Committee is right to call for a high level of evidence before the Adjudicator launches an investigation and to say it should only respond to complaints, not go on fishing trips.

"It should have rejected anonymous and third-party complaints but the recognition of our concerns about the, ’potentially huge costs to retailers of having to respond to anonymised complaints,’ and the need for strict guidance is welcome.

"We’re also pleased the Committee agrees with our concerns about previous assessments of the impact of an adjudicator. The draft Bill said the Adjudicator would cost only £800,000 a year to run, to be paid for by the ten biggest food retailers. We look forward to a more realistic assessment and to working with Government to make sure safeguards are built into the final Bill and there’s an early performance review once it is up and running."