Grocery code predicted to have no effect

James Aufenast

The new retailer Code of Practice will have little effect against the overwhelming power of the supermarkets, according to Norman Bagley, head of the Association of Independent Meat Suppliers.

"It's laughable to say that the supermarkets won't squeeze the last bit of money out of the supply chain," said Bagley. "They will just find a different way to do it and call it something else rather than 'promotional funding'. It's all good PR, but in the current competitive environment nothing will change.

"The farming community sees this code as a step forward, but do you really think the processors will raise the prices they pay to farmers to take into account their better terms with large retailers?" he added.

However, Terry Jones of the National Farmers' Union insisted: "If the processors and abattoirs aren't being squeezed as much, then in turn, that will affect the way they treat the farmers who supply them. Ultimately, it will have an effect on the whole supply chain. Consumers, too, will benefit from the increase in innovation among all concerned."

The government has confirmed that an ombudsman will be set up to police the new Code of Practice, and has launched a 12-week consultation on 5 February to decide the ombudsman's remit.

Government minister Kevin Brennan said: "It's important to hear people's views on exactly how the body should operate, its nature and exact role. A new body will help to ensure free and fair competition and that the grocery supply market continues to work in the long-term best interest of consumers."

Meanwhile, Waitrose managing director Mark Price has called for fairer prices to be paid to supermarket suppliers. "We know that our customers are going to demand even more and better local and regional food and we need a diverse supply base to provide that colour and choice," he said.

"To ensure diversity, you need good returns. Farmers need to make a living wage and that won't simply come as a cause-and-effect result of increasing global demand for soft commodities."

l For an in-depth analysis of the new Code of Practice and its ramifications for the meat industry, turn to page 8.

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