The Conservative Party’s decision to champion a supermarket ombudsman will increase pressure on the government to reveal its hand before the general election but campaigners say the Tory model does not go far enough.
Shadow environment secretary Nick Herbert this week confirmed his party’s commitment to creating the watchdog to “curb abuses of power by the major food retailers”. But he said the ombudsman should form a dedicated unit within the OFT rather than a standalone body with a mandate to proactively investigate perceived abuses of power.
“Some aspects of the way supermarkets treat their suppliers can harm consumers as well as producers,” claimed Herbert. “We have a new code of practice which outlaws unacceptable practices such as retrospective discounting, but this isn’t worth the paper it is written on without effective enforcement.”
But supporters of an ombudsman suggested the Tory proposal may not have the desired effect. They said leaving the ombudsman role with the OFT would not represent a significant change to the current situation whereby suppliers must lodge a complaint with the OFT something they have been reluctant to do in the past.
“Creating the ombudsman office within the OFT is not ideal. A totally independent office would be preferable,” said one leading competition lawyer.
Lib Dem MP Andrew George, a campaigner for the introduction of an ombudsman, gave Herbert’s proposal a cautious welcome but claimed it didn’t go far enough. “It is at least a movement in the right direction,” he said.
The move will put further pressure on the government to reveal its thinking over the ombudsman. The Competition Commission recommended it should establish the body and a statement was due in November, but this was delayed as the Department for Business, Innovation and Skills carried out further consultation with retailers. A decision is expected this month.
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