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8.21 pm
Mr. William Cash (Stone) (Con): I rise simply to say that I am concerned, because of what the Minister has said and the chicanery that I see at work, to know whether there has been an attempt to manoeuvre procedures in order to prevent us from considering the Bill properly in the normal fashion. Will it simply be left to the wash-up so that it goes through without any consideration? I believe the Bill has merit, but the way it is being taken through has none.
8.21 pm
Albert Owen (Ynys Môn) (Lab): I am pleased to follow, and agree with, the hon. Member for Stone (Mr. Cash): as the Member in charge of the Bill, I believe that it is has a lot of merit. We had an honest and open debate about it, in which the hon. Member for Christchurch (Mr. Chope) took part and tried to muster support against it but failed miserably. The only supporter that he had is in Germany today; he was unable even to get him into this country to oppose the Bill.
I support the money resolution. We need to move forward, and I believe that we are building a strong consensus. The hon. Member for Christchurch can name only the British Retail Consortium to support his point, and only senior members of that. Many of its individual members support the Bill. I believe that the supermarkets will come on board and the Bill will be the way forward, but it does have some start-up costs.
Mr. Chope: Does the hon. Gentleman expect the Bill to get on to the statute book during this Parliament, and if so, by what means?
Albert Owen: I am certainly working through the procedures, and that is why we are here tonight. The Government have agreed to give the Bill time, and I will try to get it into Committee on the 30th of this month if the resolution is passed. I hope we can move forward as quickly as possible.
The principle of the Bill is sound. As my hon. Friend the Member for Stroud (Mr. Drew) said, there are some start-up costs to get the scheme going. I describe the Bill and the grocery market as a game of rugby. We need to have a referee, and that referee needs help and support. The money resolution will provide that.
Lembit Öpik (Montgomeryshire) (LD): Does the hon. Gentleman agree that the inevitable inference from what the Conservatives who oppose the Bill say is that economic difficulties should be unloaded on to small grocery stores? In other words, those Members' solution to the recession is to carry on subjugating the people who will be least able to afford to continue running their businesses.
Mr. Deputy Speaker: Order. I am sure the hon. Gentleman realises that this is not the time to open up that kind of debate.
Albert Owen: I am grateful, Mr. Deputy Speaker. We have had a wide debate on the Bill, and I have to correct the hon. Gentleman-it is not the Conservative party that is against the Bill; it is in favour of it. One or two of its members, only one of whom is in the country at the moment, oppose it.
Chris Ruane (Vale of Clwyd) (Lab): I thank my hon. Friend for giving way and for moving the Bill forward. In the fine tradition of naming these watchdogs, such as Ofcom and Ofgas, may I proffer a name for the new watchdog body for the supermarkets of Oftrolley?
Mr. Deputy Speaker: Order. The House might just think about that for a moment.
Albert Owen: I am sure we will all consider that, but I want the House to think seriously about the money resolution and support it.
8.24 pm
Kevin Brennan: I understand the opposition of the hon. Member for Christchurch (Mr. Chope) to any public expenditure on a lot of matters that are brought before the House, but there is a wide consensus behind the Bill across the country-outside the House as well as inside. A lot of evidence was taken and presented to the Government before we decided to support the Bill and the creation of a grocery ombudsman. The debate on the ways and means motion may answer some of the questions that have been raised during this debate.
Grocery Market Ombudsman Bill (Ways and Means)
8.25 pm
The Minister for Further Education, Skills, Apprenticeships and Consumer Affairs (Kevin Brennan): I beg to move,
That, for the purposes of any Act resulting from the Grocery Market Ombudsman Bill, it is expedient to authorise-
(1) arrangements to raise money from retailers to cover costs associated with the Grocery Market Ombudsman, and
(2) the payment of sums into the Consolidated Fund.
As we have just heard, the Bill introduced by my hon. Friend the Member for Ynys Môn (Albert Owen) received its Second Reading on 5 March. It provides for the creation of a grocery market ombudsman and sets out a number of rules against which the ombudsman would monitor and enforce compliance with the code. It will enable the ombudsman to raise money from retailers to cover costs associated with the grocery market ombudsman, and it will provide for payment of sums into the Consolidated Fund. Accordingly, a Ways and Means motion is required in order that the Bill can be debated in Committee. I commend the motion to the House.
8.26 pm
John Penrose (Weston-super-Mare) (Con): I rise merely to reiterate my earlier point that the Conservative party is in favour of the principle behind the Bill. We have one or two very small quibbles to be dealt with in Committee, but that is all. We are entirely behind the principle, so we will not oppose the motion.
8.26 pm
Mr. David Drew (Stroud) (Lab/Co-op): Again, I will not delay the House for long. The motion is at the kernel of the argument about this whole issue. The supermarkets that oppose the Bill, which of course not all do, made it abundantly clear that they thought it was an expensive luxury. The reality is that the figure that has always been quoted is some £5 million, which everybody who is fair-minded would say is a drop in the ocean compared with supermarkets' profits, let alone their turnover. It is absolutely right and proper that we take the Ways and Means motion through.
Dan Rogerson (North Cornwall) (LD): I pay tribute to the work that the hon. Gentleman, the hon. Member for Ynys Môn (Albert Owen) and my hon. Friend the Member for St. Ives (Andrew George) have done on this issue. Does the hon. Gentleman agree that what we are discussing now is the answer to those who raised questions in the previous debate? The provisions in the Bill will pull in money to put in place the regulation that we want to see.
Mr. Drew: Yes, of course, and that is the whole point of bringing forward the motion.
Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) (PC): In fact, the £5 million to which the hon. Member for North Cornwall (Dan Rogerson) referred is a minuscule proportion of the rates advantage that large shops have over small retailers. It is a drop in the ocean; there is no argument about that.
Mr. Drew: That is why I think this motion should be agreed to-unanimously, I hope. This is important legislation, and the motion is about the House doing what it does best. We are bringing fairness and justice to the trade. Those of us who have studied that trade for some time know that the unfairnesses are legion and that they have grown over time. As the hon. Member for Ynys Môn (Albert Owen) said in the debate on the previous motion, we need to bring some fairness back into the grocery trade overall, and this is the legislation to do that.
8.28 pm
Andrew George (St. Ives) (LD): I support the Minister and his opposite number on the Conservative Benches, the hon. Member for Weston-super-Mare (John Penrose). I support the motion and look forward to debating the Bill in Committee on 30 March. The motion relates to clauses 11 and 12 of the Bill, which are central to it. When the Competition Commission produced a report on the issue two years ago, it clearly identified that supermarkets were passing unexpected costs on to their suppliers, which has an impact on the ability of the supply chain to innovate and a considerable knock-on effect for consumers.
As I said, the motion is central to the Bill, which the hon. Member for Ynys Môn (Albert Owen) introduced. I hope that we can make important progress next week, and that the Minister will find ways to hasten the Bill's passage to ensure that it is enacted before we go for a general election.
Lembit Öpik (Montgomeryshire) (LD): Does my hon. Friend agree that this is a most important Bill for rural constituencies? My constituents who are involved in agriculture are absolutely desperate for a fairer deal when they supply the large supermarkets, and this Bill can enable that. For that, the Ways and Means arrangements in the motion are vital.
Andrew George: My hon. Friend is of course absolutely right to say that the motion is fundamental. I hope that the Minister has heard the wide support for the Bill, of which I know he is aware, and that he will enable the Bill to be enacted before the general election.
8.31 pm
Albert Owen (Ynys Môn) (Lab): I rise briefly to echo the points made by my hon. Friend the Member for Stroud (Mr. Drew). This motion is the crux of the Bill. It dispels the myth that the Bill will be costly, a notion that many have propagated, particularly when they have been lobbied hard by the larger supermarkets. It is not going to be costly; it will be financed on a formula that withstood scrutiny and which the Competition Commission itself recommended. It is about fair trading and fairness to the suppliers, and it will give better choice to the consumer.
Mr. David Heath (Somerton and Frome) (LD): The Bill will be very costly to the supermarkets if the ombudsman does its job properly and gives a fair deal to our primary producers, particularly those in the dairy industry in constituencies such as mine, and quite rightly too, because that will be fair.
Albert Owen: As I said in the previous debate, we are dealing with a money resolution and a Ways and Means motion, but the issue is fairness, so the hon. Gentleman is right. However, I believe that the supermarkets, which have adopted the new code, will be fair, that that will benefit our suppliers, and that consumers will benefit as a result.
The Bill is about fair dealing. Some of the supermarkets are already adhering to that, and I think they will all come on board. Tonight I support my hon. Friend the Minister, who is taking the matter forward and who supports the principle. We have great consensus across the House and have united the Front Benchers. I hope the motion is passed tonight and that we can get on with talking about the details in the Bill. As I said, there is much consensus and good will, so let us move that forward.
8.32 pm
Mr. Christopher Chope (Christchurch) (Con): Again, I find myself almost in a minority of one, but that will not inhibit me in saying what I am going to say, because I know that what I say is echoed by Sainsbury's and Tesco and a whole lot of major supermarkets. Why are they major supermarkets? Because they have the confidence of their customers and they deliver good quality at keen prices. The supermarket market is very active, with firms coming and going depending on how they perform. Our successful supermarkets are the ones that operate in favour of the consumer, on behalf of whom I speak unapologetically. Other hon. Members have spoken on behalf of the producers.
Dan Rogerson: I want to clarify something. The hon. Gentleman said in the previous debate that he thought the Bill had merit, but he now seems to be saying that the whole premise is incorrect. I am intrigued.
Mr. Chope: I never said that I thought the Bill had merits; one of my hon. Friends did. If the hon. Gentleman looked at the report of my speech on Second Reading, he would see that I do not find any merit in the Bill.
I am sure that the problem should and could be addressed by the Office of Fair Trading and the Competition Commission. I do not think that the Bill is the solution.
In particular, what I do not like about the aspect of the Bill that we are discussing is the fact that the measure will be financed by a levy on the supermarkets. That levy will be of unlimited extent, as the Minister for Regional Economic Development and Co-ordination said when she referred to the issue on Second Reading. She also said:
"We are determined not to place any unnecessary costs on business, particularly in a period of economic difficulty. That is one of the reasons why we are consulting on the scope, scale and responsibilities of the new ombudsman. We want to make sure that we get this right."-[ Official Report, 5 March 2010; Vol. 506, c. 1164.]
The Government have got the cart before the horse: they should have consulted and thought through the issue before the legislation was brought forward. It should have been sorted out before the Ways and Means motion was brought before us. Under the Bill, if it ever becomes law, there will be no limit to the amount of money that could be spent by the ombudsman, and therefore to the costs that could be imposed on supermarkets and their customers.
Albert Owen: The hon. Gentleman is slightly misrepresenting the formula, which says, from memory, that each of the 11 large supermarkets will contribute 0.005 per cent. of its turnover under the scheme. Those that will pay the most are those that are referred to the ombudsman the most. All those supermarkets accept the code of practice, so they have nothing to fear unless they breach contracts or cases are taken up by the ombudsman. The hon. Gentleman is, I feel, misleading the consumer when he says he thinks that there will be additional costs placed on them, or on the goods. The good supermarkets will take that on board, and we will see fair trading.
Mr. Chope: I am grateful to the hon. Gentleman for that intervention. If there are additional costs, I do not see how they will not have to be borne by somebody. If they are not borne by the supermarkets, they will have to be passed on to their customers. The hon. Gentleman refers to the reimbursement formula; I will not trouble the House by reading out the best part of 40 lines in clause 12 that set out the formula in great detail. It is clear from those provisions in his Bill that the reimbursement formula is at large. That is why the Minister said what she did when summing up the debate on Second Reading. There is still great uncertainty about the exact basis on which the money will be raised and recovered by the ombudsman.
Nobody can dispute that any person appointed ombudsman is likely to want to increase their empire, rather than do themselves out of a job. That is the nature of Parkinson's law.
Chris Ruane (Vale of Clwyd) (Lab): Cecil?
Mr. Chope: Lord Parkinson of Carnforth would be flattered to be thought the author of Parkinson's law, but those of us of a certain age remember its real author. Nothing has changed since that law was discovered: the instinct for the public sector, in particular, to grow like Topsy, and to use every power that it is given to grow its own empire, is apparent. Indeed, the latest figures that I have seen show that while private sector employment has fallen by about 500,000 over the past year, there has been an increase in public sector employment. Obviously, there are some people in the House who would like the public sector to grow even larger, and obviously-
Mr. Deputy Speaker (Sir Michael Lord): Order. Will the hon. Gentleman please come back to the motion before the House?
Mr. Chope: Absolutely, Mr. Deputy Speaker. If the public sector grows any larger, it will be even more of a burden on the people who are paying, and the point of the motion that we are discussing is that, ultimately, the people who will pay are the consumers.
As the supermarkets have said, the Bill is misconceived, because it is helping the suppliers and attacking the consumer interests. Some of those suppliers are much larger international conglomerates than the supermarkets themselves. I think it is very sad that the House is not prepared to leave the retail grocery industry alone and let it get on with it, because it is one of the most successful and vibrant parts of our economy. There are
many people living elsewhere in Europe, and further afield, who envy us the quality and value that we get from our supermarkets.
I fear that the Bill will enable an interfering ombudsman, rather like a self-financing regulatory authority, to expand an empire and to impose arbitrary penalties and the substantial and expanding costs of his office on the supermarkets. Inevitably, the supermarkets either will be made less competitive or will have to pass on those costs to their customers. In my submission, it is a matter of basic economics, and I hope that the House will therefore reject this Ways and Means motion. If there is a silver lining, it is that if the Bill goes to Committee, we will at least be able to see, when my hon. Friend the Member for Weston-super-Mare (John Penrose) tables his amendments, exactly how much he would like to constrain the Bill, so that it can deliver a leaner and meaner solution.
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