Government stalls under pressure for ombudsman

The government insists that it needs more time to decide whether to legislate for a supermarket ombudsman, despite growing pressure from industry bodies and MPs.

In August the Competition Commission referred its recommendation for the creation of an ombudsman to ministers, with the aim of protecting suppliers from unfair supermarket practices. The government had 90 days to respond to the Commission’s referral and an announcement was due from the business secretary Lord Mandelson early this month.
Since then, however, the competition minister, Kevin Brennan MP, who has to decide whether the government should legislate on this, has announced that he is now going to embark on another round of meetings with interested parties over the next few weeks before coming to a conclusion.
The chairman of the grocery market action group, Andrew George MP, who met with the minister last week, said that the government risks undermining the authority of its primary competition authority if it refuses to accept the Competition Commission’s key recommendation. He added: “Frankly, it would be astonishing if the government believed it could reverse the conclusion of a two-year inquiry on the basis of a few meetings over a matter of weeks.”
Terry Jones, head of government affairs at The National Farmers’ Union, said: “This issue has reached a crucial phase. On the one hand, large powerful businesses are telling the government that this will push up the price of food, on the other, suppliers from the developing and developed world are clear that the abuse of market power threatens farmers’ ability to invest and innovate and, consequently, the great choice and availability that consumers enjoy. The key difference between the two is that suppliers have provided the evidence to support their claims.”