Supermarket Code of Practice to be agreed behind closed doors8 May 2001
The new supermarket Code of Practice, meant to protect small suppliers and the public from the damaging practices of big retailers, is to have no consumer or public input.
FOE, with an alliance of public interest and farming organisations including the National Federation of Women's Institutes and the Women's Food and Farming Union, has written to Trade and Industry Minister Stephen Byers demanding the Code of Practice be opened to public scrutiny.
Despite the far-reaching implications of the way in which supermarkets deal with their suppliers, there has been no consultation with consumer or public interest organisations, nor will there be. Some groups representing small farmers were also excluded from the consultation, despite the fact that the Code is meant specifically to protect them.
The Competition Commission found that the majority of the practices engaged in by the major supermarkets in dealing with their suppliers were "against the public interest". It concluded that these practices resulted in "reduced investment, product development and innovation" and "lower quality and less choice for consumers". The Competition Commission also highlighted the likely loss of smaller retailers as a result of the buying power of the big five supermarkets. It recommended that a Code of Practice be drawn up to protect suppliers and set out a template. FOE saw a draft in March - it had been watered down substantially.
Friends of the Earth is concerned that a weakened Code of Practice will simply give legitimacy to existing practices identified by the Competition Commission - such as late payment, threats of de-listing if suppliers don't lower their prices, demanding contributions from suppliers to supermarket promotions, and threats to suppliers if they continue to supply other outlets in competition with the supermarket at lower prices. The real extent of such behaviour is likely to be even more widespread than that reported by the Competition Commission - one supplier said that it would be "commercial suicide for any supplier to give a true and honest account of all aspects of relationships with retailers".
Friends of the Earth Food Campaigner Sandra Bell said: "Consumers will lose out if more small suppliers, including farmers, and small shops go out of business. And there are wider environmental implications as our food chain becomes more and more concentrated in the hands of big business. Food will travel further and our countryside change its character if more and more small farmers go to the wall. If the Government continues this hole in the corner deal with supermarkets, they will be failing farmers, consumers, and the countryside."
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