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Agriculture Committee Calls For Establishment Of Statutory Code Of Practice For Grocery Sector

Published on Oct 23 2013 12:41 PM in Retail

Agriculture Committee Calls For Establishment Of Statutory Code Of Practice For Grocery Sector

The Oireachtas Joint Committee on Agriculture, Food and the Marine has called for the creation of a statutory Code of Practice for the grocery industry, to be underpinned by the establishment of an independent supermarket ombudsman.

In addition, the report calls for legislation to be introduced to force multiples and large processors operating in Ireland to publish their profit and turnover here.

It also calls for tighter labelling regulations to be implemented, which in the case of private label products will require a prominent display detailing the processor code and country of origin of the product.

The Committee announced its intentions in a report, ‘Increasing equity and transparency in producer-processor-retailer relationships’, which was published this morning. Seven meetings were undertaken by the Committee earlier this year, ahead of the report's publication.

Commenting, Committee chairman Andrew Doyle TD said “The Committee is concerned that the large multiples and wholesalers appear to be exerting undue pressure on pricing on producers. We believe that rules based regulation is necessary as opposed to principles based regulation, so a statutory code of conduct should be implemented as soon as possible. The Committee believes that a clear, simplified and robust code can safeguard the family farm structure and primary producers, while contributing to a more transparent retail sector."

Other recommendations include greater freedom to negotiate for producer groups, the introduction of minimum pricing on alcohol products, and the banning of the below-cost selling of staple products such as milk.

"The Committee hopes the recommendations in this report will be fully considered by the Departments of Agriculture, Food and the Marine and of Jobs, Enterprise and Innovation as a matter of urgency," Doyle added.

Responding to today's announcement, Retail Ireland said that the proposal to implement a statutory grocery code of practice is 'misguided' and would lead to higher prices for consumers if implemented.

"A statutory code of practice will make it more difficult for retailers to negotiate the best price for consumers," said Stephen Lynam, Retail Ireland director. "The report also calls for price controls on staple goods, which would also push up prices. These measures would not benefit farmers, as retailers usually buy from suppliers, wholesalers and manufacturers. Those are the groups who stand to benefit.

"Irish retailers are committed to fair play, which is why many have already signalled their intent to sign up to the Supply Chain Initiative at EU level. This initiative is a much better way of ensuring a fair deal for consumers, retailers, suppliers and farmers."

RGDATA, meanwhile, welcomed the report's recommendations, saying that the proposal will help lift the 'veil of secrecy' around the dealings of large multiples. “RGDATA is delighted that the recommendations made in our submission and our presentation have been adopted by this cross party Committee," said says Tara Buckley, Director General, RGDATA.

"In particular we welcome the recommendation that the large Multiple retailers like Tesco, Aldi & Lidl should reveal their profits in Ireland. We urge the Committee to ensure that all of the recommendations are implemented. This will be in the best interests of consumers, competition, local shops and fairness and transparency in the grocery sector."

© 2013 - Checkout Magazine by Stephen Wynne-Jones

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