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Supermarket Regulator

That has been a powerful theme of my hon. Friend’s remarks. Notwithstanding what I have said about that and about the difficulty of considering complaints in a transparent way and the consequent need to know more about the complaint and the complainant, I know that my hon. Friend the Under-Secretary will reflect on what my hon. Friend the Member for Leicester, East has said. The Office of Fair Trading is committed to checking the supermarkets regularly for compliance and, most importantly, checking how suppliers who raise code issues are treated by the supermarkets afterwards. By monitoring in that way, the OFT can ensure that they are not be subject to any discrimination or sanctions. We are aware of the concerns of some sectors of the supermarket supply chain. The Government agree that supermarkets should deal fairly with suppliers, and we want to see good working relations between them. My ministerial colleagues and I remain keen to encourage dialogue between supermarkets and suppliers to ensure fair and effective resolutions to disputes. Suppliers are encouraged to approach the OFT at any time to discuss any concerns that they may have in confidence. We may need to publicise that possibility more. The OFT will investigate any complaints that it receives and take appropriate action where necessary. The OFT has not yet received any substantiated claims of breaches. It cannot be expected to take action based on unsubstantiated claims, as such action would seriously undermine the credibility of the code. I appreciate that another matter of concern to my hon. Friend are the moves by some of the supermarket chains, in particular Tesco and Sainsbury, into the convenience store sector. According to figures from the Institute for Grocery Distribution, published in May this year, Tesco and Sainsbury currently have a small share—11 per cent.—of convenience retailing. We can debate how small or large a share that is. The merger control regime takes into account whether there is a substantial lessening of competition in any merger situation, in which case the OFT has the power to refer the case to the Competition Commission for further analysis. That was not found to be the situation regarding the Tesco-Adminstore or Sainsbury’s-Bells acquisitions. There has been some consolidation in the convenience store sector, but a number of successful independent groups have managed to take on and compete with the multiples. Institute for Grocery Distribution figures predict that symbol groups such as Spar, Costcutter and Londis will increase sales from £8.7 billion in 2006 to £11.6 billion in 2010 and that the number of convenience stores will increase from 12,693 to 13,865. Following an appeal by the Association of Convenience Stores to the competition appeals tribunal—my hon. Friend the Member for Leicester, East mentioned the tribunal—the OFT is reviewing afresh its decision not to refer the grocery market to the Competition Commission. The CAT has asked for that to be done as quickly as possible, and in the circumstances the OFT should be left to complete its work unimpeded. My Department has received a large amount of correspondence in relation to the so-called ““Tescopoly”” campaign instigated by Friends of the Earth. I do not want to do any more than note the points made in that campaign, because of the work that the OFT is now undertaking on the grocery market. I expect the OFT to come up with a view on the state of competition in that market and on whether the market is working well for consumers in the context of its new decision whether to make a market investigation reference.