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Albert Owen:
I am grateful to the hon. Gentleman for reeling off the names of all the supermarkets that have moved to Cornwall. We experienced the same situation in north-west Wales during the 1980s, when there were very few supermarkets in the area. That has now changed. Because people are feeling a little wealthier and able to spend more, they are attracting more retailers, including
Waitrose in my constituency. I welcome that, and Waitrose welcomes the idea of an ombudsman. It is not true that all supermarkets oppose the idea. Many are in favour of it, and see it as the way forward.
Mr. Chope: Some supermarkets may see it as the way forward, but it is possible that they have not looked at the Bill very carefully. I think the Bill constitutes a grave distraction from the real issues affecting consumers and, indeed, suppliers.
One of the biggest problems for a supplier based in Cornwall is the cost of taking his goods to market. That is largely due to the cost of transport and the high taxes charged on diesel, which discriminate against suppliers from the more remote parts of the country. What will the Bill do about it? Nothing whatsoever.
What about the common agricultural policy, which is probably the greatest burden that consumers of grocery products in this country have to bear? I am glad to see that the hon. Member for Stroud agrees with me about that. The common agricultural policy probably adds about £1,000 a year to the average family's grocery bill. That is the big issue we should be trying to address, but the Bill avoids it. What about the costs of regulation imposed by Government on supermarkets, other retailers and suppliers? What about the VAT that is imposed on an increasingly wide range of supermarket products, including, I understand, Pringles? What about all the extra regulations that are constantly being introduced, and which discriminate against the small supplier?
The House should be addressing those major issues, rather than going along with the superficially attractive idea of creating an ombudsman whom the Bill would allow to impose unlimited fines and costs on grocery suppliers and supermarkets, and to reach determinations based on anonymous complaints against which there could be no appeal other than on a point of law. The Bill pushes arbitrariness far beyond what is reasonable. Those who are campaigning against it are well advised, and I am glad that they have support from Members of Parliament. There may not be many Members in the Chamber today, but I know that my hon. Friend the Member for Shipley (Philip Davies) and I are not alone in our concern about the Bill.
Mr. Drew: Will the hon. Gentleman tell us-for the benefit of Hansard, if for no other purpose-who is opposing the Bill?
Mr. Chope:
In anticipation of the intervention from the hon. Member for Stroud, I have it made clear that I oppose the Bill. My hon. Friend the Member for Shipley opposes it as well. I cannot speak for others, but it is a pretty good rule of thumb when we are legislating in this place that if there is a consensus between the Front Benches, it will be very bad for the country. That may not be apparent initially, but it usually becomes apparent later. The ghastly Dangerous Dogs Act 1991, for instance, was passed on the basis of consensus. So, in the end, was the ghastly high hedges legislation, which some of us opposed. It was passed with no debate whatsoever, as part of the Anti-social Behaviour Act 2003, and I
receive a lot of complaints from people who say that it raised expectations but has not delivered the goods. There are many other examples.
Albert Owen: The hon. Gentleman has identified two Members who oppose the Bill. Would he care to list those outside the House who oppose it, apart from Sir Terry Leahy, whom he mentioned earlier? It is a fact that the National Farmers Union, the Women's Institute and various other bodies that are represented in all our constituencies have thought about the issue. They are consumers, and they have concluded that the current system is unfair. Does the hon. Gentleman simply ignore what they say and what the Competition Commission says?
Mr. Chope: I shall not respond to the hon. Gentleman's challenge and list everyone who opposes the Bill, but my hon. Friend the Member for Shipley referred to one distinguished individual who has already spoken out against it. I hold no brief for the British Retail Consortium, but it seems to represent a lot of retailers: in other words, a lot of shopkeepers up and down the country. If the British Retail Consortium is against the Bill, as I understand it to be, I am sure that its members are against it. If they are not, they will soon be resigning from the consortium in accordance with the principles of the marketplace.
I can say with some confidence that if consumers realised that the Bill would push up the prices they pay in the supermarkets, they would be opposing it in large numbers. They would be lobbying and petitioning against it. I am sure that if they realised that, under the Bill they would have no right to bring cases to the ombudsman or to make representations about the consequences of the restrictions on competition that the Bill would impose, they would be eager to speak out on the subject.
We are sent to this place by our electors to exercise our judgment on the issues before us. Despite the comments of the Bill's promoter and others who say they support it, the evidence I have seen when one looks beneath the surface is that the Bill will just lead to a lot more bureaucracy and expense and will interfere in one of our most successful industries-our retail industry. That highly competitive industry delivers much lower grocery prices to consumers in the United Kingdom than are found in almost any other part of Europe. Those prices would be even lower if we could address the ghastliness of the common agricultural policy. I shall not go further down that route, Mr. Deputy Speaker, but may I just say that it is important that those of us who think this Bill wrong should have the courage of our convictions and oppose it on Second Reading? [Interruption.]
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. It may come as a surprise to hon. Members that the hon. Member for Christchurch (Mr. Chope) was as concise as he was, but attention and vigilance is wise at all times. I call Nia Griffith.
11 am
Nia Griffith (Llanelli) (Lab): Thank you, Mr. Deputy Speaker-you take the very words out of my mouth.
I begin by congratulating my hon. Friend the Member for Ynys Môn (Albert Owen) on coming so high in the ballot and on choosing this extremely important issue
out of the many different topics available. Introducing this Bill is crucial, and we have waited a long time for it. We have seen the report from the Competition Commission and we have been told that this Bill is a helpful way forward, yet there has not been an opportunity to get it enacted-it is high time that we did.
We can often get lost in nostalgia, thinking back to the time when every village had a little row of shops, but we must remember that that was the time before the motor car-or the time when many people, mostly women, had no access to motor cars-so every bit of shopping had to be carried home. Shopping was therefore done on a daily basis. Of course we have moved on from that and all of us like to enjoy the full range of consumer outlets available to us. We love going into the specialised shop where somebody who has a real love of their product and their trade can spend hours telling us all about it, but we also love going into a big supermarket and getting everything done very quickly.
We are very lucky in Llanelli because we still have an indoor market, which has many of the traditional stalls where people can do a good morning's shopping and come home with all sorts of valuable products, many of which are locally produced. Obviously, we all want to ensure that there is fairness, be it in respect of the local corner shop, which we value because we can easily pop in at any time-day or night-the supermarket, the indoor market in Llanelli or the specialist producer. Even the British Retail Consortium refers to the code of practice. If it is so keen on the code, it is difficult to see why it opposes the idea of a "referee", as my hon. Friend the Member for Ynys Môn has termed the ombudsman. It is right that we should have proper rules and regulations and a proper code.
Philip Davies: The hon. Lady goes on about that, but the code that she mentions is overseen by the Office of Fair Trading, so why do we need an ombudsman?
Nia Griffith: The Competition Commission has taken evidence and made a recommendation, so it has clearly gone into this issue far more thoroughly than perhaps the hon. Gentleman or I can possibly do in the short space of time available to us. It is clear that huge distortion has resulted from the fact that there are one or two large players in this market, and we therefore need to strengthen the tools that we have to deal with them. That is why we want a grocery market ombudsman.
Dairy farmers in my constituency face considerable difficulty. Again, we can recall what happened in the past. I remember accompanying my grandmother when she went to cook and clean on a local farm, and at that stage milking was still done by hand, with the milk put in churns. We have moved on-of course we have, because everybody needs to upgrade. High standards need to be met on hygiene and efficiency, and huge investment by farmers is required to meet them. All that needs to be financed and we know how difficult it is for some of the young people in our constituencies to remain in farming. We know how difficult it is to raise the capital to make those necessary investments and to bring everything up to the required standards.
Mark Williams:
I very much agree with what the hon. Lady is saying. Does she agree that morale has sunk to an all-time low in the dairy sector and that one of the
most attractive qualities of the Bill is the extent to which it will send a powerful message about the ability of primary producers to innovate and to invest, because it will take away some of their concerns and the risks to which they have been subjected by the behaviour of some retailers?
Nia Griffith: I agree with the hon. Gentleman. It is crucial that we should stop portraying farmers as simply whingeing; what they want is a fair deal. They want their concerns to be taken seriously and they want a fair price. The price of milk has not kept pace with inflation at all-the price has been ridiculous-and those farmers need our protection so that they obtain a fair price. They are not asking for special treatment; they are asking for fair treatment. I recall the time, some 30 years ago, when the whole fair trade movement was very new. A street theatre would show a banana being chopped into pieces to illustrate how much the producer got, how much the middle people got and how much the consumer actually paid. We have come an extremely long way since then-we have come so far that people can buy an enormous range of Fairtrade products, and supermarkets are becoming proud of the fact that they are stocking them. They boast that they do.
We need to value our home producers in the same way. This week, as part of Fairtrade fortnight, we are celebrating the progress that we have made on fair trade in respect of products that come from developing countries, but we must ensure that we do the same for our local producers. We need to ensure that they are also valued for what they produce. I have never quite understood the logic of selling lettuces at two for the price of one. People end up being tempted to buy two lettuces for the price of one, only for them to go home and find that they have already got a few lettuces in the bottom of the fridge. It is extremely difficult to get through a large quantity of lettuce in a short time, no matter how good the quality, and the product does not keep for ever and ever.
Philip Davies: The hon. Lady seems to be giving the impression that supermarkets impose things such as "buy one get one free" offers on suppliers, who do not want to pursue them. In the real world, it is suppliers who always insist that supermarkets make these offers because the suppliers see that as a way of marketing their products. "Buy one get one free" offers are the result not of supermarkets imposing them on suppliers, but of suppliers coming to supermarkets because they want to do them.
Nia Griffith:
We will have to beg to disagree on some of these points. The supermarkets have enormous power and there is enormous potential for distortion of the market. One decision made by one very large player can have a huge knock-on effect on everybody else in the market. We are considering fairness here; we are not considering special treatment. We are not being soppy, romantic and overly nostalgic and we are not assuming that nothing should ever change. We accept that there has to be change and that the modern world requires enormous changes to be made by our farmers and producers. We therefore require a fair and level playing field, whereby everything that is thought to be in any way unfair or anomalous can be examined by an independent ombudsman, who can then take up the
issues and examine whether there is a way of making things fairer and whether anybody is being badly done by. It is important to make it clear that we are not against the supermarket and we are not against the consumer.
We all understand that modern life is such that people benefit enormously from having a range of shops to which they can go. We know that people sometimes want to do everything under one roof in a hurry and they want the enormous variety that can be put on display by the supermarkets. We also know that at other times people want the shop that is just down the road from them because it is convenient and easy to reach. What is important is that any one player or any one institution is not so large and dominating that other people do not receive any form of fair play.
As I say, we are not looking back and we are not trying to recreate some sort of ideal from the past, which of course was never quite such a golden era as we always seem to imagine. We are living in the modern world and are trying to get a fair deal so that the consumer can know that when they go to buy products, the people who have produced them receive a reasonable price. The consumer demands that nowadays. The consumer demands Fairtrade products, demands to know whether companies that import clothing from third world countries are using child labour and wants to know whether the staff in the local supermarket are allowed to join a trade union. Consumers are very ethical and discerning.
Mark Williams: The hon. Lady will agree, I am sure, with the point that has been made repeatedly this morning-the annual report that the ombudsman will be required to provide to give a bill of health on the performance of the supermarkets in these matters will give the consumer exactly the kind of information that is needed. Far from this being a supermarket-bashing debate, it is about empowering consumers to make decisions on the behaviour of the supermarkets. That should surely be welcomed.
Nia Griffith: Indeed. The interest in ethical investment and in wanting to spend one's money in businesses that one feels are ethical is growing daily. People want to make ethical investments, whether by investing in certain companies or shopping in certain places. Consumers are asking questions. They are asking whether people are treated fairly-whether staff are treated properly in the local supermarket or whether the producer gets a fair price. If the ombudsman can give a bill of health to a supermarket, it will be proud of that fact. It will probably want to badge it in some way and to talk it up in their local community. It is important that we get full consensus behind the idea, as it is through the support of the law-abiding majority that we make laws in this country, and that applies in this case. The supermarkets that are doing the right thing, that care about the price that they pay their producers and that look after their staff and consumers are not worried by the idea of a referee.
The idea that a referee could be damaging in any way seems completely absurd. Clearly, the idea is that those who play fair are dealt with fairly. The only difficulty would arise if there was exploitation or if totally
unreasonable pressure was applied. As the hon. Member for Brecon and Radnorshire (Mr. Williams) said, it is not just a matter of price. It might also be a matter of terms and conditions. We know that, with the difficulties of the economic downturn over the past year and a half, ready income is important to the small supplier. We know that being paid promptly can make a huge difference between being in business or going out of business. It is not simply a matter of price-terms and conditions come into it, too, and so might such things as exclusivity clauses and ways in which the producer can be hemmed in or forced into a position in a manner that, frankly, we would term bullying in many other spheres of life. The producer cannot wriggle out or choose who they supply. We are busy talking about choice from the point of view of the consumer, but the producer also needs freedom to act so that they can get what they feel is the best price for their product and are not hemmed into a particular way of production and supply for a particular chain.
To sum up, we need to live in the modern world-we should not be nostalgic for times gone past-in which we, as consumers, are ethical and demand good standards, and choice. We want to have the specialist, the corner shop, the market and the supermarket, but we also recognise that the difficulties facing the farming industry at the moment mean that we could lose the ability to produce our own products such as milk. I hear people saying that we could be importing our milk from abroad before long. If someone goes out of business, they cannot simply press a button and start all over again. We all know how long it takes to restock and to build up a herd and a viable dairy farm. It is worrying to hear that some of our dairy farmers think, yet again, that they might have to pull out of the industry. They would be added to the many hundreds who have already done so. We are talking about food security and about a basic product, such as milk, having to be brought in from abroad.
It might come as a surprise to my hon. Friends to hear that we now produce more of our own food than we did back in the 1950s, when we had a large empire and were dependent on imports. However, it is important that we should look to the future and consider how we nurture and protect producers in all sectors. We know that people have to be responsive. Corus, in my constituency, which produces tins for many well-known brands, has to be extremely responsive and it has kept going through the economic downturn because of its immense flexibility. It is prepared to switch in a fortnight the style and quantity of tin that it provides for certain big producers because of changes in consumer patterns. If consumers suddenly want more baked beans, more tinned fruit or whatever, the Corus packaging plant in my constituency can change the type of tin that is required very quickly. We need such flexibility from the producer, but we do not want a situation in which producers cannot survive. That is the importance of this Bill. Without a grocery ombudsman, we might well see the end of many of our dairy farms. That is one of the main reasons why I support the Bill promoted by my hon. Friend the Member for Ynys Môn.
11.17 am
John Penrose (Weston-super-Mare) (Con):
I start by congratulating the hon. Member for Ynys Môn (Albert Owen) on having come so high in the ballot-although
I am never sure why we congratulate each other on what is essentially a matter of chance-and on laying out this Bill in an extremely logical and careful way. He put the case very strongly and is also benefitting from widespread consensus across most of the House-certainly in the three major parties. He explained that and some of the factors that have led to the building of that consensus over many years. I congratulate him on that, too. He handled many interventions with a great deal of courtesy and logic and therefore managed to deal with an awful lot of the points that were likely to come up later in the course of his remarks.
The hon. Gentleman covered two issues that are worthy of extra detail. The first was the question of large suppliers versus small ones and the second was that of whether the proposed ombudsman should be in or out of the Office of Fair Trading. I propose to come back to them in a moment if I can.
I am not sure whether it is necessary for me to make this point, Mr. Deputy Speaker, but I shall make it anyway on the precautionary principle. My wife used to work for a couple of large supermarkets-
John Penrose: The hon. Gentleman says that his wife did, too. I am not sure whether it is necessary to declare such non-interests, if I can put it that way, but I shall apply the precautionary principle just so that it is on the record.
The hon. Member for Ynys Môn was followed by the hon. Member for St. Ives (Andrew George). As someone with the name of Penrose-a solid Cornish name-I sympathise with the fact that he cannot be too close to Cornwall on St. Piran's day, which is very important in that part of the world. He is a leading light in the Grocery Market Action Group and I suspect that today is therefore an important day for him and everybody else in that organisation. It represents something of a victory on which they obviously deserve to be congratulated.
It is worth pausing to mark the important distinction that the hon. Member for St. Ives made between fair dealing and price setting. It is vital that everyone acknowledges that the Bill is proposing a mechanism to force and drive home fair dealing, and that it is not about price setting. If the Bill were to trip over the line between fair dealing and price setting, I think that none of us would support it. My party would certainly have great difficulty in doing so.
Andrew George indicated assent.
John Penrose: That is an important principle to establish. To be fair, when I gently asked the hon. Member for St. Ives to distinguish between the ombudsman system that would be set up by the Bill and his party's proposals for a food market regulator, he was kind enough to draw a distinction and to say that this Bill would involve an entirely smaller operation.
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