Supermarket Ombudsman Statement
The Fairtrade Foundation welcomes the announcement by UK Consumer Minister Kevin Brennan that the government has accepted the Competition Commission's recommendation to create a body to enforce the enhanced Groceries Supply Code of Practice (GSCOP), to protect the interests of consumers, suppliers and farmers.
This landmark decision reflects one of the core principles of Fairtrade, recognising the need to address the imbalance of power in the supply chain. The UK groceries sector is highly concentrated; after its lengthy enquiry the Competition Commission concluded that retailers can exercise their enormous buying power to “transfer excessive risk and costs to suppliers” and that these practices “could damage investment and innovation in the supply chain to the ultimate detriment of consumers”.
Establishing an independent ombudsman to ensure compliance with the revised GSCOP will be a significant step in helping the weakest in the supply chain, often small-scale farmers both in the UK and developing countries, sustain their businesses in a very competitive market. This is not just in the interests of farmers, but also of consumers, as it will help to ensure diversity, choice and quality.
Mike Gidney, Deputy Director of the Fairtrade Foundation said: “The success of Fairtrade has demonstrated that increasing numbers of consumers want to know that their products have been produced ethically and sustainably. But we need to ensure fairness all along the supply chain. The establishment of a strong, independent groceries ombudsman will be great news for small producers in developing countries as well as in the UK, as it will help to level the playing field between suppliers and the supermarkets. We hope this will lead to more retailers playing fairly in the way they deal with producers, by providing long-term contracts and fair terms of trade”.