The Scottish Government has appealed to farmers to step forward with any evidence relevant to the Groceries Code Adjudicator probe into Tesco’s practices.
Reacting to news that the supermarket giant faces an official investigation into its practices, including delays to supplier payments, Rural Affairs Secretary Richard Lochhead said: “Suppliers in Scotland who have evidence that is relevant will now be able to bring that forward.
“I would encourage them to do so.”
Mr Lochhead said consumers and the general public need an assurance that everyone, from prime producers at one end of the supply chain to retailers at the other end, is getting a “fair share of every pound spent on groceries”.
The investigation into Tesco is the first to be launched by GCA watchdog Christine Tacon.
“I have always argued for a robust role for the GCA, and welcome this evidence that she is taking a keen interest in relations between suppliers and retailers,” said Mr Lochhead.
According to NFU Scotland the investigation serves as a “sharp reminder” to all parts of the food chain that the code has genuine standing.
NFUS food chain relationships manager John Armour said: “Primary producers will be appreciative that this investigation is being undertaken, and the signals that it sends out.
“That said, Ms Tacon remains limited to examining the relationship between our biggest retailers and those who have direct dealings with them.”
Although he conceded the adjudicator cannot pro-actively investigate issues, Mr Armour said: “We also note Ms Tacon’s request for any party who feels that they have been subject to breaches of the code when supplying retailers to come forward so that their claims can be assessed.
“That could spark a culture change that ensures that all, and not just some, processor/retailer relationships abide by the code’s guidelines.”
While Business Secretary Vince Cable declared the announcement of the GCA probe was a historic day that “shows we have created a regulator that has real teeth”, shadow farming minister Huw Irranca-Davies said the Government had “dragged its heels for months” in terms of the real bite of the issue.
Indeed, critics argue Ms Tacon’s presence is not enough to get supermarkets such as Tesco to change the way it operates because the GCA has no powers to fine any grocer guilty of breaking its code.
Instead Ms Tacon can currently only ‘name and shame’ any company found guilty of wrongdoing.
Mr Irranca-Davies said: “Whilst it’s welcome to see the first evidence of the Groceries Code Adjudicator carrying out an investigation to protect suppliers, this Government has dragged its heels for months on giving the regulator the power to impose fines.”
Ms Tacon has been lobbying for change. She wants a remit to grant the GCA the power to impose a fine on supermarkets of up to 1% of their UK revenues should they be caught breaking the code of practice.
This change is currently passing through Parliament, but it is considered unlikely any ‘fining power’ will be granted prior to the end of next month at the very earliest.
Even then, Ms Tacon will not be able to retrospectively fine grocers and, as a result, the current investigation regarding Tesco is unlikely to result in a fine.
Mr Irranca-Davies added: “There are also concerns that we still have no clarity on whether the Prime Minister’s promise to review the remit and powers of the GCA will lead to anything being done before the election.”
The investigation is expected to take place over the next six to nine months, and the GCA has called for evidence to be submitted by April 3.