MPs and members of the farming industry have called for more power to be vested in the supermarket ombudsperson. MPs have demanded the watchdog, who will be responsible for enforcing the grocery industry Code of Practice which came into force last year, be given the power to fine food giants for unfair treatment of suppliers.

Current plans for the creation of a grocery adjudicator would give the ombudsperson limited powers, such as ordering stores to publish the results of investigations. However, in a report on the Draft Groceries Adjudicator Bill published today by the Commons Business Committee, MPs said the watchdog should be allowed to issue financial penalties from the get go. The NFU said it hopes the government accepts the committee’s recommendations.

The Code of Practice was introduced last year in response to complaints from producers that supermarkets wielded an unfair weight over their suppliers, and used this to impose inequitable terms on them. The code aims to limit the powers of the largest retailers in that it bans supermarkets with an annual turnover of £1bn or more from food from passing on unfair costs to its suppliers and from changing contract terms without notice.

Furthermore, echoing earlier calls from the NFU, the committee said the adjudicator should be allowed to investigate complaints from trade associations as well as individual suppliers. IT said that in order to counteract the effects of the ‘climate of fear’ described earlier this year by the NFU, taking complaints from trade associations would help provide a ‘cloak of anonymity’ for producers who might otherwise not come forward to report unfair practices.

The NFU welcomed the findings, saying the MPs had recognised and accommodated the union’s recommendations in its report. Commenting on the report, the NFU’s head of government affairs Nick von Westenholz said, "It’s good news that the committee has recognised the need for a groceries code adjudicator to be established speedily to monitor and enforce the Groceries Supply Code of Practice.

"In particular, we are extremely pleased to see that the BIS committee agrees with us that the adjudicator’s powers should be extended to include information from trade associations, such as the NFU, when deciding whether to launch an investigation into breaches of the code. The committee has also recommended that the power to fine retailers for breaches of the code should be available to the adjudicator from the outset, something we have also argued for strongly."