Groceries Code Adjudicator

In 2008 the Competition Commission determined that the buyer power of UK grocery retailers can be contrary to consumer interests – through the transfer excessive risks and unexpected costs to their grocery suppliers, which can in turn lessen suppliers’ incentives to invest in more sustainable production processes.

To help address these concerns, the government is committed to establishing a Groceries Code Adjudicator (GCA), which will monitor and enforce the ‘Groceries Supply Code of Conduct’ – thereby ensuring that large grocery retailers do not treat their suppliers unfairly.

The need for an effective GCA is supported in the Food Ethics Council’s Food and Fairness Inquiry, which found that retailers’ demands for flexibility contributed to the increasing casualisation and insecurity of food sector employment. Our work also shows that an effective GCA will help to promote sustainable food system, by ensureing that any increased costs are shared along all stages of the supply chain.

There are, however, a number of concerns about the likely effectiveness of the GCA as proposed in the draft bill.

Priorities

The following priorities could address these concerns:

• In order to protect the anonymity of suppliers, it would be prudent to allow the GCA to instigate investigation on the basis of credible evidence provided by third parties, including trade associations.
• The power to impose proportionate financial penalties should be available to the GCA.
• The GCA must promote environmental sustainability, by helping to ‘nudge’ retailers to support more sustainable food production.