Friday Volume 506 5 March 2010 No. 51 HOUSE OF COMMONS OFFICIAL REPORT PARLIAMENTARY DEBATES (HANSARD) Friday 5 March 2010 £5·00 © Parliamentary Copyright House of Commons 2010 This publication may be reproduced under the terms of the Parliamentary Click-Use Licence, available online through the Office of Public Sector Information website at www.opsi.gov.uk/click-use/ Enquiries to the Office of Public Sector Information, Kew, Richmond, Surrey TW9 4DU; e-mail: [email protected] 1117 5 MARCH 2010 Grocery Market Ombudsman Bill 1118 David Cairns (Inverclyde) (Lab): I congratulate my House of Commons hon. Friend on bringing forward his Bill. Will it address the non-grocery products that supermarkets sell? I am Friday 5 March 2010 thinking, for example, of petrol, whereby the local pricing policy of large grocery retailers leads to a great The House met at half-past Nine o’clock distortion. In Inverclyde, which has some prosperous areas but also a lot of deprivation, the petrol prices that grocery retailers set are higher than those in many much PRAYERS more prosperous areas of Scotland. I am grateful to a The Chairman of Ways and Means took the Chair as constituent of mine, John MacNeil, who has driven all Deputy Speaker (Standing Order No. 3). around Scotland pricing petrol. Will my hon. Friend’s Bill address the supermarkets’ local pricing policy on Mr. Andrew Dismore (Hendon) (Lab): I beg to move, that product? That the House sit in private. Question put forthwith (Standing Order No. 163). Albert Owen: My hon. Friend makes an important Question negatived. point, and, indeed, I attended a debate about petrol prices in Westminster Hall. It is a big issue, and there Grocery Market Ombudsman Bill are market failings in that area, too. In order to move forward, we need the Office of Fair Trading to undertake Second Reading an inquiry into petrol pricing. The OFT and the 9.35 am Competition Commission could recommend to the Government a policy on those imbalances, which my Albert Owen (Ynys Môn) (Lab): I beg to move, That hon. Friend has described. They are evident in all our the Bill be now read a Second time. constituencies, and I represent a periphery area, where I am delighted to move the Second Reading of this we face exactly the same problems. Not only are some Bill, the principle of which has gathered support from of the large retailers and supermarkets varying their those in all parts of the House since it was introduced in petrol prices; they are having a huge impact on independent December. It is appropriate that I put on the record my suppliers, many of which have had to close down. sincere thanks to the Grocery Market Action Group, which consists of a powerful alliance of organisations, John Penrose (Weston-super-Mare) (Con): I apologise including the Association of Convenience Stores, the for butting in on the hon. Gentleman so early in his Rural Shops Alliance, the Independent Fruit Growers speech, but I want to back up the point that he was Association, the British Brands Group, the National making in response to that last intervention. Does he Farmers Union, ActionAid UK, Traidcraft and Banana agree that it would be inappropriate to use an ombudsman Link. Many of those organisations have lobbied Members to stick up for the oil companies, many of which are to attend today’s debate, and they are very supportive of larger than the supermarkets concerned? There might Members’ support for the Bill. be an issue of the kind that has just been discussed, but The action group is ably chaired by the hon. Member an ombudsman would be the wrong way to deal with it. for St. Ives (Andrew George), and I pay tribute to him for his long-standing campaign to address the imbalance Albert Owen: I agree. We are talking about not only in the grocery market. The group has played a constructive the retailers of petrol but the distributors and oil companies. role since it was set up in 2006, when the Competition Although we need a fresh independent inquiry into the Commission began its latest inquiry into the retail pricing mechanism, I do not think that this Bill—or, sector. I thank also the Farmers Union of Wales and, indeed, an ombudsman—is the way forward for that. particularly, my local Ynys Môn branch, which has lobbied me for a long time—since I was first elected in Mr. Christopher Chope (Christchurch) (Con): Does 2001, in fact. It has argued in a forthright and coherent the hon. Gentleman accept that there have been many manner for a grocery code of practice and an ombudsman inquiries that have always come down in favour of to implement the code effectively, and I have led a saying that an active market is operating and that there number of union delegations to meet Ministers in the are additional costs in rural areas that have to be borne House, including the Minister with responsibility for by somebody? However, how is petrol retailing associated food, farming and the environment, my hon. Friend the with groceries? As I understand it, those are what this Member for Poplar and Canning Town (Jim Fitzpatrick), Bill is about. who was very receptive to the idea of an ombudsman. I also acknowledge the farmers unions’ dairy industry Albert Owen: I do not think that the hon. Gentleman campaigns to secure a fair price for producers, given was listening to what I said. What he has mentioned is what they consider to be market failings. I agree with not in the Bill. An important point was raised about the them and hope that in some way the Bill will address variations in petrol prices across the United Kingdom, that imbalance, too. and he says that many inquiries have favoured the I want to make it clear that I am not anti-supermarket, retailers and the oil companies on the issue. Indeed, in nor indeed are the terms of the Bill. In fact, I am the past there have been many inquiries in respect of the pro-supermarket. I am also pro-small shops, pro-small issues raised by my Bill today. However, the most recent convenience shops, pro-local suppliers and, above all, one came to the conclusion that there were market pro-consumer. The supermarkets are the major retailers, failings. That is why there is a new code and why we and they are important contributors to the local economies need a new ombudsman. We need an up-to-date inquiry of all our constituencies and, indeed, the country’s by the Office of Fair Trading into petrol prices in the wealth. future. 1119 Grocery Market Ombudsman Bill5 MARCH 2010 Grocery Market Ombudsman Bill 1120 Mr. Andrew Dismore (Hendon) (Lab): Perhaps I can Albert Owen: I agree, and I thank the hon. Gentleman raise a different point and get my hon. Friend off the for all the support that he has given me and for his work petrol issue. I am here to support his Bill, but one of with the National Farmers Union and the Grocery the issues in relation to supermarkets is suppliers from Market Action Group to establish the code and make the developing world. Bearing in mind that we are in sure that we have the inquiry. I will develop my argument Fairtrade fortnight, does my hon. Friend consider that and deal with the issue in greater detail. his Bill does anything to support developing-world suppliers, which often get a raw deal from supermarkets? Mr. Roger Williams (Brecon and Radnorshire) (LD): I am sure that the hon. Gentleman will agree with me Albert Owen: Yes, indirectly. This is about choice. We on a point that he might develop later. The issue is not are all lobbying and campaigning for greater choice and all about prices; it is about terms of trade as well. I greater brands, and Fairtrade is an important source of recently discovered a supermarket that tried to increase those. The Bill will help. Many of the organisations that its credit terms to 90 days. That is an impossible situation lobbied hard for it welcome that, because they believe for a small supplier, so the matter is about more than that it will do something to help them in future. price—it is about terms of trade as well. Philip Davies (Shipley) (Con): Earlier, the hon. Gentleman said that he was pro-consumer and that he saw an Albert Owen: It is, and that comes under the umbrella imbalance between the power of the supermarkets and of fairness. As my hon. Friend the Member for Hendon that of the suppliers. Presumably, therefore, he wants (Mr. Dismore) said, the issue is about fair trade, including the appointment of the ombudsman to result in higher Fairtrade suppliers. The whole ambit is covered by what payments from supermarkets to suppliers. That would the code will produce, but the Bill is specifically about inevitably lead to higher prices for customers. Given the ombudsman. that he is so in favour of consumers, will he tell us by Before I took those interventions, I was praising the how much he expects prices to go up and the kind of supermarkets for their importance in the local and rise that he thinks would be acceptable? national economy. In the United Kingdom, the food retail sector represents about £110.4 billion. The Albert Owen: I thank the hon. Gentleman for that supermarkets are at the end of the supply chain; at the intervention. What is involved is not what I say as I other end are the producers, farmers and suppliers.