Groceries Supply Code of Practice

I beg to move,

That this House has considered e-petition 643216, relating to the Groceries Supply Code of Practice.

It is always a pleasure to serve under your chairpersonship, Mrs Murray. The petition asks the Government

“to amend the Grocery Supply Code of Practice (GSCP) to require retailers, without exception, to…Buy what they agreed to buy…Pay what they agreed to pay…Pay on time”.

The petition also states:

“Almost half (49%) of a panel of 100 UK fruit and veg farmers fear they will have to give up their farm within the next 12 months, and many raised concerns about the behaviour of supermarkets, with 69% agreeing that tougher regulations are required to redress the imbalance of power between farmers, processors and the supermarkets.

The current GSCP contains provisions that are meant to protect suppliers, but allows supply agreements to be varied in certain circumstances.”

The petitioners

“believe a stronger, clearer code of practice is needed to make sure that all supermarkets stick to fair practices when dealing with farmers.”

There are complex perspectives on the code and the issues raised in the petition that need to be unpacked, but it is worth beginning with an overview of the salient facts and how the situation came into being. The groceries supply code of practice was introduced in 2009, following an investigation by the Competition Commission, in a bid to strengthen the food supply chain and improve relationships between growers and retailers. The Groceries Code Adjudicator, or GCA, was established by the Groceries Code Adjudicator Act 2013, and is responsible for enforcing the code.

Despite its success and the best intentions, the code has faced criticism from farmers and academics. The main issues are that the code does not cover the relationships between farmers and any processor or intermediary, that the code does not cover of pricing, that there is an imbalance of power and risk, that the GCA is under-resourced, and that the GCA is both adjudicator and arbitrator. I want to unpick each issue in turn, but let us first recognise the integral role that farmers play in our society: they are the stewards of our land, custodians of our food security and backbone of our economy. However, the code’s structure often leaves farmers vulnerable to unfair trading practices, and places them at a significant disadvantage in negotiations with powerful retailers.

I congratulate my hon. Friend on her introductory remarks and welcome the debate. The last few years have been very difficult for farmers, with inflation in the wider economy increasing their input costs substantially: we need only to look at fertiliser for one example. The reality is that they are very exposed in the supply chain, so we need to look at how we can strengthen support for our primary producers.